Nokian Renkaat Oyj · OMXHEX:TYRES
Nokian Renkaat Oyj — Nokian Tyres — Q1 2020 Earnings Presentation
20 slides from Nokian Renkaat Oyj's earnings presentation, May 5, 2020
Slide 1: Russia, COVID-19 and Mild Winter Impacting First Quarter
RUSSIA, COVID-19 AND MILD WINTER IMPACTING FIRST QUARTER – STRONG BALANCE SHEET SUPPORTING IN DIFFICULT TIMES MAY 5, 2020 HILLE KORHONEN PRESIDENT AND CEO
Slide 2: Immediate Measures Taken to Minimize the Impacts of COVID-19
IMMEDIATE MEASURES TAKEN TO MINIMIZE THE IMPACTS OF COVID-19 • Top priority to ensure the health and safety of our employees HEALTH AND SAFETY • Preventive measures taken at an early stage: travel and visitor restrictions, remote working, health guidelines • Working capital management: production ca
Slide 3: Q1: Lower Volumes in Passenger Car Tyres Impacting Net Sales and Operating Profit
Q1: LOWER VOLUMES IN PASSENGER CAR TYRES IMPACTING NET SALES AND OPERATING PROFIT • Net sales EUR 279.8 million (340.3), -16.5% with comparable currencies • Decline due to measures taken to reduce high carry-over stocks in the Russian distribution channel, slowing economic activity caused by COVID-1
Slide 4: Car Tire Sell-in Declined in 1–3/2020 in All Markets
CAR TIRE SELL-IN DECLINED IN 1–3/2020 IN ALL MARKETS The Nordic countries Russia Europe (excl. the Nordic countries) North America New car sales -10% New car sales +2%* New car sales -27% New car sales -13% Car tire sell-in -13% Car tire sell-in -30% Car tire sell-in -19% Car tire sell-in -10% Heavy
Slide 5: Key Figures 1–3/2020
KEY FIGURES 1–3/2020 1–3/ 1–3 Change CC* EUR million 2019 2020 /2019 % Change % Net sales 279.8 340.3 -17.8% -16.5% 1,585.4 Segments operating profit 16.3 56.7 337.2 Segments operating profit % 5.8% 16.7% 21.3% Segments EPS, EUR** 0.09 1.44 3.06 Segments ROCE, %*** 14.4% 18.6% Equity ratio, % 69.4%
Slide 6: Nokian Tyres Overall SG&A Cost Level in Line or Below Peers
NOKIAN TYRES OVERALL SG&A COST LEVEL IN LINE OR BELOW PEERS SG&A incl. R&D share of sales (%) Peer SG&A-% incl. R&D-% median 20% Company Company Company Company Company Company Company Company Company Company Company Company Nokian Company Company A B C D E F G H I J K L Tyres M N Note: Last availab
Slide 7: 1–3/2020: Passenger Car Tyres
1–3/2020: PASSENGER CAR TYRES Headwinds from Russia, COVID-19, and mild winter 1–3 1–3 Change CC* 2019 /20 /19 % Change % Net sales, M€ 190.5 253.0 -24.7% -23.4% 1,123.8 Segment operating profit, M€ 25.8 66.0 308.5 Segment operating profit, % 9.7% 25.0% 27.4% * Comparable currencies • Net sales decl
Slide 8: 1–3/2020: Passenger Car Tyres Bridge
1–3/2020: PASSENGER CAR TYRES BRIDGE Negative impact of EUR 27 million from sales volume on SOP NET SALES, M€ -23,4% 253 -57 -2 194 -3 190 -22,7% -0,7% -1,3% 1-3/2019 Sales volume Price/Mix Net Sales Currency 1-3/2020 excl FX SEGMENT OPERATING PROFIT, M€ effect 66 -27 Unabsorbed SC cost due to lower
Slide 9: Passenger Car Tyres Net Sales - Quarterly Changes
PASSENGER CAR TYRES NET SALES - QUARTERLY CHANGES YoY Change % Sales volumes Price/Mix Currency 1,7% 2,1% 1,9% 2,1% 0,5% 1,5% -0,8% -0,8% -0,7% -1,3% -1,8% -0,9% -5,0% -6,5% -22,7% Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 2019 2020 2019 2020 2019 2020 9
Slide 10: 1–3/2020: Heavy Tyres
1–3/2020: HEAVY TYRES Sales growth continued 1–3 1–3 Change CC* 2019 /20 /19 % Change % Net sales, M€ 51.2 48.3 6.0% 6.4% 202.7 Segment operating profit, M€ 8.2 9.0 35.7 Segment operating profit, % 16.1% 18.7% 17.6% * Comparable currencies • Demand was good in core product groups • Net sales +6.4% w
Slide 11: 1–3/2020: Vianor
1–3/2020: VIANOR Mild winter season affected net sales 1–3 1–3 Change CC* 2019 /20 /19 % Change % Net sales, M€ 54.4 57.0 -4.4% -1.7% 336.5 Segment operating profit, -12.4 -12.0 7.7** M€ Segment operating profit, -22.8% -21.0% 2.3% % Number of own service 186 187 189 centers at period end * Comparab
Slide 12: We Continue to Build a Competitive Product Portfolio – Latest Products
WE CONTINUE TO BUILD A COMPETITIVE PRODUCT PORTFOLIO– LATEST PRODUCTS Passenger Car Tyres Heavy Tyres NOKIAN HAKKAPELIITTA NOKIAN SNOWPROOF P NOKIAN POWERPROOF SUV NOKIAN TRACTOR KING TRUCK E2 New UHP tire for Central European New generation SUV summer tire New Nokian Hakkapeliitta truck Nokian Trac
Slide 13: Focus on Immediate Actions and Long-Term Competitiveness
FOCUS ON IMMEDIATE ACTIONS AND LONG-TERM COMPETITIVENESS Strict cost control and efficient cash flow management Short-term capacity utilization adjusted to the current operating environment Continuous monitoring of the market situation Employee health a top priority Our solid foundation, including
Slide 14: Peace of Mind in All Conditions
PEACE OF MIND IN ALL CONDITIONS
Slide 15: Appendix
“ASkian’® TYRES
Slide 16: Group Operating Profit per Quarter 2016–Q1/2020
APPENDIX GROUP OPERATING PROFIT PER QUARTER 2016–Q1/2020 1–3/2020 CUMULATIVE OPERATING PROFIT PER REVIEW PERIOD 400 350 • Net sales 279.8 M€ 300 (340.3 M€), -17.8% 250 200 M€ 150 • Operating profit 9.0 M€ 100 (53.9 M€) 50 0 1–3 1–6 1–9 1–12 GROUP OPERATING PROFIT PER QUARTER 150 100 M€ 50 0 Q1 Q2 Q3
Slide 17: Material Cost Development
APPENDIX MATERIAL COST DEVELOPMENT Decreased in Q1/2020 MATERIAL COST DEVELOPMENT INDEX 2010–E2020 140 131 131 MATERIAL COSTS 130 (€/KG) 120 114 • Decreased by 9.2% in Q1/2020 110 100 vs. Q1/2019 100 96 92 92 96 90 86 • Decreased by 6.3% in 83 79 80 Q1/2020 vs. Q4/2019 70 2010 2011 2012 2013 2014 20
Slide 18: Net Debt and Debt Maturities
APPENDIX NET DEBT AND DEBT MATURITIES Net Debt Debt Maturities Q1/2020 Q1/2019 Q1/2020 500 500 250 250 400 110 400 200 200 300 300 75 134 150 150 EUR million EUR million 10 200 133 200 23 20 100 175 100 30 100 206 100 134 123 50 104 50 0 0 76 25 25 18 14 0 1 1 1 4 0 -100 -100 Debt Cash Net Debt Cash
Slide 19: Network Development Progressed
APPENDIX NETWORK DEVELOPMENT PROGRESSED NAD Vianor, NAD, N-Tyre; +14 stores in 1–3/2020 N-TYRE VIANOR VIANOR – 1,165 SERVICE CENTERS ICELAND IN 19 COUNTRIES 4 186 own stores and 979 partners USA 10 260 Own -3, partner -2 vs. year-end 2019 NORWAY SWEDEN FINLAND 135 101 107 • Largest tire chain in the
Slide 20: It's a Beautiful Journey – Disclaimer
IT’S A BEAUTIFUL JOURNEY Disclaimer Statements in this presentation, which are not historical facts, such as expectations, anticipations, beliefs and estimates, are forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Such statements in