Nokian Renkaat Oyj · OMXHEX:TYRES
Nokian Renkaat Oyj — Nokian Tyres — Q1 2022 Earnings Presentation
21 slides from Nokian Renkaat Oyj's earnings presentation, Apr 27, 2022
Slide 1: War in Ukraine Overshadowed Q1, Tire Demand Good
WAR IN UKRAINE OVERSHADOWED Q1, OPERATING ENVIRONMENT HIGHLY UNCERTAIN, TIRE DEMAND GOOD INTERIM REPORT JANUARY–MARCH 2022 APRIL 27, 2022 JUKKA MOISIO – CEO TEEMU KANGAS-KÄRKI – CFO
Slide 2: Net Sales and Segments Operating Profit Improved
NET SALES AND SEGMENTS OPERATING PROFIT IMPROVED • Net sales EUR 416.5 million (341.8), +21.8% with comparable currencies • Year began with good demand in all markets • In late February, the war in Ukraine started to impact on the operating environment • Segments operating profit EUR 66.5 million (5
Slide 3: Strong Balance Sheet Supporting in Difficult Times
STRONG BALANCE SHEET SUPPORTING IN DIFFICULT TIMES 1–3/ 1–3/ CC* EUR million 2022 2021 Change Change 2021 Net sales 416.5 341.8 21.9% 21.8% 1,714.1 Segments operating profit 66.5 50.3 324.8 Segments operating profit % 16.0% 14.7% 19.0% Segments EPS, EUR 0.38 0.29 1.84 Segments ROCE, %** 16.2% 10.6%
Slide 4: Q1: Passenger Car Tyres
Q1: PASSENGER CAR TYRES Tire demand continued on a high level 1–3/ 1–3/ CC* 2022 2021 Change Change 2021 Net sales, M€ 314.9 245.9 28.1% 28.4% 1,199.2 Segment operating profit, M€ 74.2 52.8 298.7 Segment operating profit, % 23.6% 21.5% 24.9% * Comparable currencies • Net sales increased in all main
Slide 5: Passenger Car Tyres Net Sales - Quarterly Changes
PASSENGER CAR TYRES NET SALES - QUARTERLY CHANGES YoY Change % Sales Volumes Price / Mix Currency 5
Slide 6: Q1: Passenger Car Tyres Bridge
Q1: PASSENGER CAR TYRES BRIDGE Price/Mix impacted segment operating profit positively by EUR 47 million NET SALES, M€ 350 +28% 47 316 -1 315 300 22 250 246 9,1% 19,3% -0,3% 0 1-3/2021 Sales Volume Price/Mix Net Sales excl Currency 1-3/2022 FX effect SEGMENT OPERATING PROFIT, M€ 6
Slide 7: Q1: Heavy Tyres
Q1: HEAVY TYRES All-time high first quarter segment operating profit 1–3/ 1–3/ CC* 2022 2021 Change Change 2021 Net sales, M€ 66.4 57.1 16.4% 14.7% 254.0 Segment operating profit, M€ 12.8 12.6 40.3 Segment operating profit, % 19.2% 22.0% 15.9% * Comparable currencies • Net sales grew driven by stron
Slide 8: Q1: Vianor
Q1: VIANOR Slow start for the year in a seasonally low quarter 1–3/ 1–3/ CC* 2022 2021 Change Change 2021 Net sales, M€ 57.1 58.1 -1.8% -1.8% 342.9 Segment operating profit, M€ -12.1 -9.8 4.1 Segment operating profit, % -21.3% -16.9% 1.2% Number of own service 174 173 175 centers at period end * Com
Slide 9: Operating Environment Severely Impacted by the War in Ukraine
OPERATING ENVIRONMENT SEVERELY IMPACTED BY THE WAR IN UKRAINE, SEVERAL MEASURES TAKEN • Top priority to ensure the health and safety of our Ukrainian colleagues, and to support all Nokian Tyres employees HEALTH AND SAFETY • Constant communication about the situation in the organization • Donation to
Slide 10: Preparations for New Supply Capability Started
PREPARATIONS FOR NEW SUPPLY CAPABILITY STARTED • All options are being evaluated (own/JV production/ contract manufacturing) • We have started to expedite plans to invest in new production capacity in Europe • The new dividend proposal cuts the total dividend payable to shareholders by EUR 106 milli
Slide 11: Priorities for the Coming Quarters
PRIORITIES FOR THE COMING QUARTERS • Adapting to the fast-changing and highly uncertain operating environment • Complying with applicable sanctions regime • Protecting the safety of our team • Maintaining control of our factory in Russia • Protecting cash flow • Board evaluating long-term strategic
Slide 12: Assumptions for 2022
ASSUMPTIONS FOR 2022 • War in Ukraine and resulting sanctions severely impacting our operating environment and causing significant uncertainty • Restrictions in manufacturing in Russia estimated to have an adverse impact on our supply capacity, impacting sales especially in Russia and Central Europe
Slide 13: Guidance for 2022
GUIDANCE FOR 2022 The war in Ukraine and resulting sanctions cause significant uncertainty to Nokian Tyres’ operating environment. Nokian Tyres’ net sales and segments operating profit in 2022 are expected to decrease significantly compared to 2021. 13
Slide 14: Thank You!
THANK YOU!
Slide 15: Appendix
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Slide 16: Car and Tire Markets in Q1/2022
APPENDIX CAR AND TIRE MARKETS IN Q1/2022 The Nordic countries Russia Europe (excl. the Nordic countries) North America New car sales -19% New car sales -28% New car sales -10% New car sales -15% Car tire sell-in 0% Car tire sell-in 0% Car tire sell-in 7% Car tire sell-in 3% Heavy tire segments* Heav
Slide 17: Group Segments Operating Profit per Quarter 2018–Q1/2022
APPENDIX GROUP SEGMENTS OPERATING PROFIT PER QUARTER 2018–Q1/2022* 1–3/2022 CUMULATIVE SEGMENTS OPERATING PROFIT PER REVIEW PERIOD 400 • Net sales 416.5 M€ 350 (341.8), 21.9% 300 250 200 • Segments operating profit 150 66.5 M€ (50.3) 100 50 0 -50 1-3 1-6 1-9 1-12 SEGMENTS OPERATING PROFIT PER QUARTE
Slide 18: Material Cost Development
APPENDIX MATERIAL COST DEVELOPMENT Increased in Q1/2022 MATERIAL COST DEVELOPMENT INDEX 2010–E2022 140 131 131 129 MATERIAL COSTS (€/KG) 130 120 • Increased by 14.2% in Q1/2022 114 112 110 vs. 2021 100 98 100 96 96 • Increased by 31.8% in Q1/2022 92 92 90 83 84 vs. Q1/2021 80 79 • Increased by 1.3%
Slide 19: Net Debt and Debt Maturities
NET DEBT AND DEBT MATURITIES Net Debt Debt Maturities Q1/2022 Q1/2021 Q1/2022 500 500 350 350 450 450 300 300 400 400 149 250 250 350 350 150 EUR million 300 300 200 200 EUR million 250 250 158 150 150 200 163 200 27 150 150 150 100 100 20 100 100 122 50 50 128 129 30 50 50 36 20 21 30 0 1 1 1 14 1
Slide 20: Network Development
APPENDIX NETWORK DEVELOPMENT NAD Vianor, NAD, N-Tyre; -142 stores in Q1/2022 N-TYRE VIANOR VIANOR – 1,046 SERVICE CENTERS IN 14 COUNTRIES ICELAND 4 174 own stores and 872 partners USA CANADA Own -1, partner unchangeable vs. year-end 2021 464 25 • Largest tire chain in the Nordic countries: NORWAY 13
Slide 21: Disclaimer
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 involve risks and uncertain