Volvo Ab Class A · OMXSTO:VOLV_A
Volvo Ab Class A — Q2 2020 Earnings Presentation
24 slides from Volvo Ab Class A's earnings presentation, Jul 17, 2020
Slide 1: Second Quarter 2020
SECOND QUARTER 2020 Martin Lundstedt, President and CEO
Slide 2: Volvo Group COVID-19 crisis response
Volvo Group COVID-19 crisis response ILLUSTRATIVE Health and safety Volume Supply disrupted Demand disrupted ? Initial Stop Re-start Gradual return ”New normal” shock Q1 Today Volvo Group Second quarter 2020 2 2020-07-17
Slide 3: Focused activities in Q2
Volvo Group FOCUSED ACTIVITIES IN Q2 Colleagues – health and safety first Customers – support • Secure customer uptime • Contract modifications in Financial Services • Successful re-start of supply chain and production Cash – protect the Group • Collect receivables and pay suppliers • Reduce new and
Slide 4: Second quarter highlights
NET SALES Volvo Group SEK bn 12 months SEK 369 bn 120.7 SECOND QUARTER HIGHLIGHTS 103.6 73.2 Net sales o Vehicles: -46% o Services: -15% Good volume flexibility in production Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 R&D cash, Selling & Admin: -30% ADJUSTED OPERATING INCOME (margin)* 12 months 8.3% Adjuste
Slide 5: Volume development in the second quarter
Volvo Group VOLUME DEVELOPMENT IN THE SECOND QUARTER TRUCK DELIVERIES MACHINE DELIVERIES k units HD/MD k units HD/MD 12 months 166,876 units 12 months 86,112 units -58% +8% 59.6 54.8 29.1 26.9 24.1 25.0 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Volvo Group Second quarter 2020 5 2020-07-1
Slide 6: Service sales development
Volvo Group SERVICE SALES DEVELOPMENT SERVICE SALES, Industrial Operations SEK bn 12 months SEK 82.4 bn -15% -14% excl. FX 21.3 19.7 18.1 TRUCKS CONSTRUCTION BUSES VOLVO PENTA EQUIPMENT Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Excl. FX: Volvo Group Second quarter 2020 6 2020-07-17
Slide 7: Trucks
Trucks
Slide 8: Managing the COVID-19 impact - forecast visibility low
Trucks MANAGING THE COVID-19 IMPACT - FORECAST VISIBILITY LOW Utilization of Volvo trucks in Europe Trucks global net order intake Average km driven per week (index) (Monthly) -5% -20% -5% -90% Easter weekend Volvo Group Second quarter 2020 8 2020-07-17
Slide 9: HD/MD: quarterly orders -47% and deliveries -58%
Trucks HD/MD: QUARTERLY ORDERS -47% AND DELIVERIES -58% NORTH AMERICA EUROPE Orders Deliveries Orders Deliveries Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Orders -44% Orders -52% Deliveries -79% Deliveries -55% SOUTH AMERICA AFRICA AND OCEANIA ASIA Orders Deliveries Orders Deliveries Ord
Slide 10: Market shares
Trucks MARKET SHARES Volvo Group Second quarter 2020 10 2020-07-17
Slide 11: Construction Equipment
Construction Equipment
Slide 12: Construction Equipment quarterly orders and deliveries
Construction Equipment QUARTERLY ORDERS 11% AND DELIVERIES 8% NORTH AMERICA EUROPE Orders Deliveries Orders Deliveries Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Orders -85% Orders -51% Deliveries -48% Deliveries -45% SOUTH AMERICA AFRICA AND OCEANIA ASIA Orders Deliveries Orders Deliveri
Slide 13: Buses and Volvo Penta orders and deliveries
Volvo Buses and Volvo Penta ORDERS AND DELIVERIES Volvo Buses Orders decreased by 55% with coach and tourist segments severely hit by COVID-19 Deliveries decreased by 68% Volvo Penta Orders decreased by 34% Deliveries decreased by 34% Volvo Group Second quarter 2020 13 2020-07-17
Slide 14: Financial Services
Financial Services Supporting customers with increased levels of modifications Increased provisions due to elevated risk Penetration continues to improve Volvo Group Second quarter 2020 14 2020-07-17
Slide 15: Second Quarter 2020 - Jan Ytterberg, CFO
SECOND QUARTER 2020 Jan Ytterberg, CFO
Slide 16: Net sales per market
Volvo Group NET SALES PER MARKET Volvo Group Second quarter 2020 16 2020-07-17
Slide 17: Adjusted operating income contributors
Volvo Group ADJUSTED OPERATING INCOME CONTRIBUTORS Volvo Group Second quarter 2020 17 2020-07-17
Slide 18: Cash flow and financial position
Volvo Group – Industrial Operations CASH FLOW AND FINANCIAL POSITION Volvo Group Second quarter 2020 18 2020-07-17
Slide 19: Trucks net sales and adjusted operating income
Trucks NET SALES AND ADJUSTED OPERATING INCOME NET SALES 12 months SEK 231.2 bn ADJUSTED OPERATING INCOME* ADJUSTED OPERATING INCOME SEK bn SEK bn (margin)* 12 months 8.0% -46% SEK bn Currency SEK +0.4 bn (excl. FX -45%) 9.5 75.9 9.5 + Selling and Admin (12.6%) 65.2 + Cash R&D + Volume flexibility 7
Slide 20: Construction Equipment net sales and adjusted operating income
Construction Equipment NET SALES AND ADJUSTED OPERATING INCOME NET SALES ADJUSTED OPERATING INCOME* ADJUSTED OPERATING INCOME SEK bn 12 months SEK 80.7 bn SEK bn (margin)* SEK bn 12 months 12.3% -15% Currency SEK -0.1 bn 4.2 4.2 (excl. FX -14%) 3.7 (15.5%) + Selling and Admin 26.8 (15.1%) 3.1 + Cash
Slide 21: Buses and Volvo Penta adjusted operating income
Volvo Buses and Volvo Penta ADJUSTED OPERATING INCOME VOLVO BUSES ADJUSTED OPERATING INCOME VOLVO PENTA ADJUSTED OPERATING INCOME (margin)* (margin)* SEK M SEK M 12 months -0.1% 12 months 11.9% Currency SEK -23 M Currency SEK +10 M 403 709 618 260 (4.5%) (19.9%) (16.8%) (3.8%) -532 345 (-16.6%) (13.
Slide 22: Financial Services credit portfolio and profitability
Financial Services CREDIT PORTFOLIO AND PROFITABILITY NEW RETAIL FINANCING ADJUSTED OPERATING INCOME* CREDIT PORTFOLIO & ADJ. ROE* SEK bn SEK M SEK bn 12 months SEK 78.9 bn 12 months SEK 2,141 M Adj. ROE 12 months 11.1% Currency SEK -18 M 142 165 20.9 163 19.4 686 17.3 582 57 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
Slide 23: Focus going forward
Volvo Group FOCUS GOING FORWARD Safety first Carefully monitor COVID-19 impact on economies, demand and supply Balance the re-start of selected activities with the recovery in demand Convert short term cost reductions into structural cost savings Accelerate transformation into new technolo
Slide 24: Q&A - Volvo Group Capital Markets Day
Q&A Volvo Group Capital Markets Day November 5,14:00-16:30 CET Virtual event