Slide 1: Analysts' conference
Analysts’ conference March 30, 2020
Slide 2: Coronavirus pandemic holding the world on tenterhooks
Opening remarks Coronavirus pandemic holding the world on tenterhooks Unprecedented situation in Europe, global spread of outbreak without equals Strict rules of conduct for the people to contain the pandemic – initiated and enforced by governments around the world Chancellor Merkel: “Since the Worl
Slide 3: Main global auto regions affected by coronavirus pandemic
Opening remarks Main global auto regions affected by coronavirus pandemic Total number of confirmed coronavirus cases by country Total number of confirmed coronavirus cases per 1 million people 123,776 1,566 1,529 92,472 81,439 73,235 57,685 689 576 37,575 374 252 17,089 187 9,583 3,904 1,693 57 18
Slide 4: Highlights FY 2019
Group Highlights FY 2019 Top line growth of 1.6% to EUR 1,727 million, organically up by 0.5% EBIT pre PPA at EUR 63.2 million, EBIT margin pre PPA at 3.7 %; cost-cutting measures and real estate sale with positive impact on earnings Operating free cash flow remarkably improved to EUR 175.8 million,
Slide 5: Markets and Strategy
Markets and Strategy
Slide 6: Megatrends trigger technological transformation process
Markets Megatrends trigger technological transformation process Urbanization Safety systems Scarcity of resources Autonomous driving Global megatrends Globalization transform the Efficient propulsion automotive industry Technological progress Connectivity Climate change Shared mobility Analysts’ Con
Slide 7: Autos overall a growing market – driven by new drive systems
Markets Autos overall a growing market – driven by new drive systems Global light vehicle production per drivetrain – in million units CAGR +1.2% Driven by mobility trends (e.g. taxi services and ridesharing) Driven by costs and preferences Driven by regulation 108 100 Battery/ CAGR 94 17 +22% 89 88
Slide 8: Emission regulations are the key short-term driver
Markets Emission regulations are the key short-term driver CO2 limits – in g/km South Korea 2020 97g CO2/km average fleet emissions EU 2021 USA 2025 95g CO2/km average fleet emissions China 2025 Japan 2030 91g CO2/km average 94g CO2/km average 32% reduction of average fleet fleet emissions fleet emi
Slide 9: Roadmap for continuing transformation
Group strategy Roadmap for continuing transformation Present Future Managing the Stable market • High dependency on ICE technology growth in the with strong • Established customers classical business position Developing new • Mainly established customers products within • Contributing the strengths
Slide 10: Stable combustion engine market for the next decade
Managing the classical business Stable combustion engine market for the next decade Global LV production by drive systems – in million units CAGR -0.1% 92 Key remarks 87 87 91 4 85 86 5 9 • Pure combustion engine cars are 14 18 47 Hybrid expected to decrease remarkably • Hybrid cars will strongly in
Slide 11: Product example #1: Cylinder-head gaskets
Managing the classical business Product example #1: Cylinder-head gaskets • Most classical product of ElringKlinger • Strong market position - almost every second car drives with a cylinder-head gasket by ElringKlinger • Reliable sealing through unique technology with beads for macro sealing, elasto
Slide 12: Classical business units with components for new technologies
Transforming the classical business Classical business units with components for new technologies ICE EV Cylinder-head gasket Bipolar plate Injection Embossing molding End cover Forming Core Service cover Coating competencies Laser Stamping welding Exhaust tract shielding Material Tooling Battery sh
Slide 13: Product example #2: Disc carrier
Transforming the classical business Product example #2: Disc carrier • Developed by Specialty Gaskets business unit • Withstanding very high mechanical loads and speeds • Enabling weight savings of up to 50% compared to standard market solutions • In series production for a full-electric vehicle of
Slide 14: Strong market potential of EV cars particularly in Asia
Unlocking the potential of new drive systems Strong market potential of EV cars particularly in Asia Global EV production by region – in million units Americas Europe Asia/Pacific CAGR +21.0% CAGR +26.8% 8.9 CAGR +13.2% 4.6 1.6 0.4 0.3 1.1 2019 2030 2019 2030 2019 2030 Source: IHS (02/2020), ElringK
Slide 15: ElringKlinger with expertise for components, modules and systems
Unlocking the potential in new drive systems ElringKlinger with expertise for components, modules and systems Battery Fuel cell EDU Components Modules Systems Customers‘ needs Analysts’ Conference | March 30, 2020 15
Slide 16: Broad range of applications for fuel cells
Unlocking the potential of new drive systems Broad range of applications for fuel cells Mass market acceptability of fuel cells 2020 2025 2030 2035 2040 2045 2050 Taxis and limousine services City buses Medium and large cars Trams/railways Coaches Trucks Freight ships and airplanes Small cars Ambiti
Slide 17: Product example #3: fuel cell stack
Unlocking the potential of new drive systems Product example #3: fuel cell stack • ElringKlinger with strong expertise over almost two decades • Ready for series production • Electrical output of 2 to 150 kW possible based on sophisticated metallic bipolar plates • Optional integration of peripheric
Slide 18: ElringKlinger's sales structure of products will change
Group strategy ElringKlinger’s sales structure of products will change Sales split (actual and ambition) – in % of total sales Actual 2019 Ambition 2030 Non-automotive Non-automotive products products Aftermarket 5% Aftermarket ~10% 10% Functional components Structural ~10% lightweight 8% and e-mobi
Slide 19: Nominated e-mobility volumes create a healthy basis for future sales
Group strategy Nominated e-mobility volumes create a healthy basis for future sales Nominated volumes* – in EUR million 1,000 ~10% • Strong growth particularly in the fuel cell and battery business ~50% • Acceleration especially after ~10% ramp-up years 2019 and 2020 • Includes systems as well as ~7
Slide 20: Higher degree of vertical integration results in more content per car
Group strategy Higher degree of vertical integration results in more content per car Content per car – in EUR Present Future 40 - 60 EUR Content per car 100 - 10,000 EUR (100-150 EUR incl. cross-car beam) Analysts’ Conference | March 30, 2020 20
Slide 21: Financials
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Slide 22: Organic growth in a challenging market environment
FY 2019: Order intake and sales Organic growth in a challenging market environment Order intake – in EUR million Sales – in EUR million +0.1% +1.6% 1,735 1,737 1,727 -6 +9 +25 1,699 2018 2019 2018 FX M&A Organic 2019 -2.4% -2.8% 391 382 432 0 +5 -17 420 Q4 2018 Q4 2019 Q4 2018 FX M&A Organic Q4 2019
Slide 23: Strong demand in North America triggers sales increase
FY 2019: Sales Strong demand in North America triggers sales increase Growth LV production vs. sales ElringKlinger (FX adjusted) – in % Sales by region – in EUR million resp. % Europe North America Asia 25.1% -4.0% -5.8% -1.4% Market EK FY 2019 -8.2% -3.8% Market EK Market EK FY 2019 FY 2019 4% 18%
Slide 24: OE segment expands in strategic fields of the future
FY 2019: Sales OE segment expands in strategic fields of the future Sales by segment – in EUR million Share of total sales – in % Services Engineered 9 (10) Plastics <1% (<1%) 118 (118) 7% (7%) Industrial Parks Aftermarket 4 (4) 173 (159) <1% (<1%) 10% (9%) Lightweighting/Elastomer : 29% (27%)
Slide 25: Global production network supplies broad customer base
FY 2019: Sales Global production network supplies broad customer base Sales by customer group – in % of total sales American 11% OEMs Other 20% (18%) 31% (30%) 6% 3% EUR 10% 1,727million German OEMs 6% 21% (22%) 5% Aftermarket 10% (9%) French OEMs Tier 1 4% (5%) 14% (16%) Analysts’ Conference | Marc
Slide 26: Product mix effects and raw material prices impacted earnings
FY 2019: Earnings Product mix effects and raw material prices impacted earnings EBITDA – in EUR million EBIT pre PPA – in EUR million -7.9% -37.0% 197 181 100 -17 +4 -13 -5 63 -8 +5 -3 2018 2019 2018 Divest- Sales Product Raw North Cost Others 2019 ments growth mix mats America*savings +51.9% 57 +>1
Slide 27: Aftermarket and Engineered Plastics with strong margins
FY 2019: Segments Aftermarket and Engineered Plastics with strong margins Sales – in EUR million EBIT margin – in % of segmental sales Original Equipment (OE) Aftermarket 365.0 360.7 361.3 353.0 348.5 44.7 45.2 36.6 40.9 41.7 18.9% 0.6% 0.6% 11.5% Q4 2018 Q1 Q2 Q3 Q4 2019 Q4 2018 Q1 Q2 Q3 Q4 2019 En
Slide 28: Net income affected by taxes and currency effects
FY 2019: Earnings Net income affected by taxes and currency effects Net income (attributable to shareholders)– in EUR Earnings per share (EPS) – in EUR -90.6% -91.3% 43.8 0.69 4.1 0.06 2018 2019 2018 2019 +>100% +>100% 7.5 0.12 -1.2 -0.02 Q4 2018 Q4 2019 Q4 2018 Q4 2019 • High tax rate was attributa
Slide 29: Comprehensive efficiency program implemented in 2019
FY 2019: Balance sheet Comprehensive efficiency program implemented in 2019 Earnings Net working capital Capex Measures with short and mid-term Measures: impact: • Extending payment terms for • Group-wide cost reduction program trade payables Disciplined approach • Optimizing op. performance in • Re
Slide 30: Initiated optimization measures show effects
FY 2019: Balance sheet Initiated optimization measures show effects Net working capital– in EUR million -25.4% 606 568 9 6 499 478 10 9 423 11 Current contract assets 415 401 393 387 356 Inventories 306 332 277 266 233 Trade receivables -136 -140 -157 Trade payables -168 -166 -10 -9 Current contract
Slide 31: Free cash flow significantly improved
FY 2019: Cash flow statement Free cash flow significantly improved Capex – in EUR million Capex ratio – in % of total sales Operating free cash flow – in EUR million +>100% -43.6% 175.8 163.5 92.2 9.6% 5.3% -86.2 2018 2019 2018 2019 41.9 98.6 Real estate 21.6 sale 28.8 25.4 30.8 20.7 65.7 17.4 2.6 9
Slide 32: Improved maturity structure through syndicated loan
FY 2019: Net financial debt and maturity structure Improved maturity structure through syndicated loan Net financial debt – in EUR million Net financial debt/EBITDA Maturity structure of financial debt (excl. IFRS 16) – in EUR mn 3.7 3.3 -17.7% 796 498 724 700 681 595 47 IFRS 16 472 Non-current 535
Slide 33: Outlook
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Slide 34: China was the starting point, rest of the world follows
Coronavirus crisis impacts auto industry China was the starting point , rest of the world follows Number of confirmed coronavirus cases 35,000 Europe 30,000 25,000 20,000 15,000 China 10,000 USA 5,000 0 1 5 10 15 20 25 30 1 5 10 15 20 25 1 5 10 15 20 25 30 January February March • In China, the outb
Slide 35: Production halted by most OEMs in Europe and North America
Coronavirus crisis impacts auto industry Production halted by most OEMs in Europe and North America Production locations of global top 15 OEMs ( ) ElringKlinger production sites ( ) UK Germany China France Turkey Spain Italy USA Japan India Mexico South Africa Brazil Status: March 26, 2020 Analysts’
Slide 36: Production estimates significantly revised each month
Coronavirus crisis impacts auto industry Production estimates significantly revised each month Forecasts global auto production 2020 – in % Forecasts auto production China 2020 – in % 2.6 9.9 2.4 2.2 0.6 8.5 8.5 4.1 3.7 0.3 0.6 3.7 2.1 1.6 0.1 -0.4 -0.7 -2.1 -2.2 -2.7 -2.8 -2.8 -6.0 -2.9 -12.6 -10.8
Slide 37: Market forecast for FY 2020 uncertain due to coronavirus crisis
Outlook 2020: Markets Market forecast for FY 2020 uncertain due to coronavirus crisis Light vehicle production growth – in % vs. 2019 +1 to -1 % -4 to -6% -9 to -7 % North America Europe China • Trade agreement with • Corona virus pandemic • Sharp Q1 decline due to China not finally closed leads to
Slide 38: Economic effects cannot be determined reliably and accurately
Outlook 2020: Group Economic effects cannot be determined reliably and accurately When will the Will there be a How quickly X X Will a next global lockdown in strong recovery in will supply chains wave of pandemic Europe and North global auto stabilize after re-start follow America be ended markets
Slide 39: Appendix
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Slide 40: Structural overview ElringKlinger Group
ElringKlinger Structural overview ElringKlinger Group Sales EUR 1,727 million EBIT (pre PPA) EUR 63.2 million Employees 10,393 EBIT margin (pre PPA) 3.7 % Original Equipment Aftermarket 82% Sales: EUR 1,423 million 10% Sales: EUR 173 million of Group sales of Group sales Employees: 9,176 Employees:
Slide 41: Product portfolio
Group Product portfolio Cylinder-head Gaskets E-Mobility Battery module Specialty Gaskets PEM fuel cell Electric drive unit (EDU) Shielding Technology Lightweighting/ Thermal shielding Elastomer Technology Acoustic shielding Door module carrier Cockpit cross-car beam Plastic modules
Slide 42: Consolidated income statement
Group – FY 2019 Consolidated income statement 2019 2018 Sales revenue 1,727 1,699 Cost of sales -1,402 -1,329 Gross profit 325 370 Gross margin in % 18.8 21.8 Selling expenses -133 -147 General and administrative expenses -85 -84 Research and development costs -64 -76 Other operating income 34 46 Ot
Slide 43: Consolidated statement of financial position
Group – FY 2019 Consolidated statement of financial position As of Dec As of Dec As of Dec As of Dec Assets 31, 2019 31, 2018 Liabilities and equity 31, 2019 31, 2018 Intangible assets 208 190 Share capital 63 63 Property, plant, and equipment 1,044 998 Capital reserves 118 118 Investment property 3
Slide 44: Consolidated statement of cash flows
Group – FY 2019 Consolidated statement of cash flows 2019 2018 2019 2018 Earnings before taxes (EBT) 42 81 Proceeds from disposals of PPE, intangible Depreciation/amortization (less write- assets and investment property 10 1 ups) of non-current assets 120 100 Proceeds from disposals of financial ass
Slide 45: Key figures
Group – Last 5 years Key figures 2019 2018 2017 2016 2015 Order intake 1,737 1,735 1,732 1,694 1,615 Order backlog 1,030 1,020 1,001 933 796 Sales 1,727 1,699 1,664 1,557 1,507 EBITDA 181 197 238 231 223 (Adjusted) EBIT pre PPA 63 100 142 140 140 (Adjusted) EBIT margin pre PPA in % 3.7 5.9 8.5 9.0 9
Slide 46: Segmental figures
Group – Last 5 years Segmental figures 2019 2018 2017 2016 2015 Group Sales 1,727 1,699 1,664.0 1,557.4 1,507.3 EBIT (reported) 61.2 96.2 137.3 135.6 135.2 EBIT margin in % 3.5 5.7 8.3 8.7 9.0 Original Equipment Sales 1,423.4 1,407.7 1,382.4 1,294.3 1,255.8 EBIT (reported) 5.1 50.7 86.3 88.9 91.2 EB
Slide 47: Key figures – last quarters
Group – Last 5 quarters Key figures Q4 2019 Q3 2019 Q2 2019 Q1 2019 Q4 2018 Order intake 382 438 420 498 391 Order backlog 1,030 1069 1,063 1,077 1,020 Sales 420 432 434 441 432 EBITDA 57 50 39 35 38 EBIT pre PPA 24.8 20.8 10.7 6.9 11.8 EBIT margin pre PPA (in %) 5.9 4.8 2.5 1.6 2.7 EBIT (reported)
Slide 48: Segmental figures – last quarters
Group – Last 5 quarters Segmental figures Q4 2019 Q3 2019 Q2 2019 Q1 2019 Q4 2018 Group Sales 420 432 434 441 432 EBIT (reported) 24.2 20.3 10.2 6.4 10.6 EBIT margin (in %) 5.8 4.7 2.3 1.5 2.5 Original Equipment Sales 349 353 361 361 365 EBIT (reported) 2.0 6.4 2.0 -5.3 2.2 EBIT margin (in %) 0.6 1.
Slide 49: Strategic areas
Group strategy ElringKlinger provides a transformed portfolio Present Future Functional Disk Brake carrier Components Cylinder-head Gaskets Metal- hat elastomer Strategic areas gaskets Engine Specialty Gaskets Tank Dampening shielding Underbody shielding pan Shielding Technology protection Front-end
Slide 50: ElringKlinger represented in all important auto regions
Group ElringKlinger represented in all important auto regions Production locations of global top 15 OEMs ( ) ElringKlinger production sites ( ) Germany UK China Eastern France Europe/ Spain Turkey Korea Italy Japan USA/Canada India Southeast Asia Mexico Capex (in PPE)/ratio – in EUR million/in % Sou
Slide 51: Focused R&D activities
Group Focused R&D activities R&D – in EUR million R&D ratio – in % of total sales 5.0% 4.7% 4.8% 4.6% 5.1% 4.7% 87 81 • Integration of tools implies a 75 technological lead position in the 71 67 development of ideas 64 • Main focus: lightweight components, e-mobility 76 64 • 611 R&D employees at sit
Slide 52: Senior management
Group Senior management Theo Becker, CTO Reiner Drews, COO (since1994) (since 2018) Central units Dr. Stefan Wolf, CEO Central units Purchasing (since 2005) Production Mgmt. Tooling Technology Quality & Environmental Real Estate & Facility Mgmt. Central units Mgmt. Legal & Compliance Thomas Jessulat
Slide 53: More than 140 years of experience and solid shareholder structure
Group More than140 years of experience and solid shareholder structure History of ElringKlinger in very brief Shareholder structure as at December 31, 2019 1879 Paul Lechler establishes a merchandising business in Stuttgart for technical products and gaskets. 1885 Richard Klinger Institutional Priva
Slide 54: IR calendar and contact
IR calendar and contact Date Event May 7, 2020 Q1 2020 July 7, 2020 Annual General Meeting August 11, 2020 Q2 2020 November 10, 2020 Q3 2020 From left to right: Heiderose Mall, Christoph Staib, Kathrin Graf, Sabrina Haufler, Dr. Jens Winter ElringKlinger AG Investor contacts Strategic Communications
Slide 55: Disclaimer
Disclaimer Forward-looking statements and predictions This presentation contains statements about the future. These statements are based on current expectations, market evaluations and predictions by the Management Board, and on information that is currently available to them. The statements about t