Deutz Ag · XETR:DEZ
Deutz — Q1 2016 Earnings Presentation
31 slides from Deutz's earnings presentation, May 3, 2016
Slide 1: Q1 2016 results
Q1 2016 results 3 May 2016 Dr Helmut Leube, CEO Dr Margarete Haase, CFO
Slide 2: Agenda
Agenda Review Q1 2016 Outlook Annex Q1 2016 results 3 May 2016 2
Slide 3: Key figures
Key figures Q1 2016 yoy qoq € million New orders 327.3 2.0% 11.7% Revenue 300.2 -5.6% -2.7% EBITDA 31.3 -7.7% +17.7% EBIT 7.3 -€2.8 million +€13.0 million Net income 8.7 +€1.0 million +€12.5 million Q1 2016 results 3 May 2016 3
Slide 4: Highlights
Highlights ■ DEUTZ presented extended product portfolio at fair trade ”bauma 2016” • Positive customer feedback on new 2.2 litre diesel, gas engines and TCD 5.0 engine project • TCD 5.0 is scheduled to go into production in 2019 to gain market share in the 100 to 150 kW output range ■ Engine portfol
Slide 5: Sales figures
Sales figures New orders Unit sales Revenue € million Units € million 2.0% -13.0% -5.6% 321.0 327.3 36,907 318.1 3,312 32,112 300.2 72.1 67.9 2,342 67.1 64.7 33,595 29,770 248.9 259.4 251.0 235.5 Q1 2015 Q1 2016 Q1 2015 Q1 2016 Q1 2015 Q1 2016 Revenue decreased to a lesser extent than unit sales due
Slide 6: Revenue by quarter
Revenue by quarter € million 410.7 424.5 342.7 352.3 352.1 318.1 308.6 300.2 268.6 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Advance production of engines ahead of changes to European emissions standards for engines < 130 kW in October 2014 with significant influence on revenue We antici
Slide 7: Revenue split by region
Revenue split by region Q1 2016 (Q1 2015) Africa/Middle East 5 % Europe (excl. Germany) 47 % €14.3 million €142.2 million (€19.3 million) (€145.3 million) Asia-Pacific 11 % €33.3 million (€29.7 million) €300.2 million (€318.1 million) Americas 21 % Germany 16 % €63.4 million €47.0 million (€81.9 mil
Slide 8: Revenue split by application
Revenue split by application Q1 2016 (Q1 2015) Other 3 % Mobile Machinery 41 % €8.7 million €121.6 million Automotive 6 % (€3.5 million) (€134.6 million) €19.2 million (€21.2 million) Stationary Equipment 12 % €300.2 million (€318.1 million) €36.8 million (€47.7 million) Agricultural Machinery 14 %
Slide 9: Operating profit & net income
Operating profit & net income Q1 2015 Q1 2016 € million 33.9 23.8 31.3 24.0 10.7% 10.1 1.1 1.3 10.4% +2.3 8.7 7.7 7.3 0.9 EBITDA D&A EBIT Net Income Net EBITDA D&A EBIT Net Income Net interest taxes income interest taxes income expense expense Operating profit benefitted from licence proceeds by €5.
Slide 10: EBIT
EBIT € million 10.1 7.3 -6.3 +4.3 -0.8 Q1 2015 Q1 2016 EBIT margin 3.2% 2.4% EBIT decline at DEUTZ Compact Engines mainly attributable to lower capacity utilisation and FX Licence proceeds at DEUTZ Customised Solutions largely compensated lower business volume Prior year result at segment Other was
Slide 11: Segment: DEUTZ Compact Engines
Segment: DEUTZ Compact Engines Q1 Q1 Change Q1 Q4 Change € million 2016 2015 in % € million 2016 2015 in % New orders 259.4 245.9 4.2 New orders 259.4 234.4 10.7 Unit sales 29,770 33,595 -11.4 Unit sales 29,770 27,618 7.8 Revenue 235.5 251.0 -6.2 Revenue 235.5 237.1 -0.7 EBIT -2.3 4.0 -- EBIT -2.3 -
Slide 12: Segment: DEUTZ Customised Solutions
Segment: DEUTZ Customised Solutions Q1 Q1 Change Q1 Q4 Change € million 2016 2015 in % € million 2016 2015 in % New orders 67.9 72.1 -5.8 New orders 67.9 58.6 15.9 Unit sales 2,342 3,312 -29.3 Unit sales 2,342 2,927 -20.0 Revenue 64.7 67.1 -3.6 Revenue 64.7 71.5 -9.5 EBIT 10.2 11.0 -7.3 EBIT 10.2 5.
Slide 13: R&D & capital expenditure
R&D & capital expenditure R&D Capital expenditure (excl. R&D) € million 13.7 16.0 Gross expenditure 2.8 10.8 Reimbursements 0.7 8.5 Net expenditure 0.1 10.9 10.1 8.4 Net R&D Q1 2015 Q1 2016 Q1 2015 Q1 2016 expenditure ratio(1) 3.4% 3.4% R&D remain at moderate level Capital expenditure increase large
Slide 14: Working capital & operating cash flow
Working capital & operating cash flow Working capital Operating cash flow € million 245.4 229.4 12.4 -8.0 Working Q1 2015 Q1 2016 Q1 2015 Q1 2016 capital ratio (31 March) 16.3% 18.7% Increase of working capital ratio related to Operating cash flow decline mainly due to lower revenue decline in the s
Slide 15: Free cash flow generation & net financial position
Free cash flow generation & net financial position Free cash flow(1) Net financial position € million 35.0 15.5 9.7 7.2 2015 Q1 2016 (LTM) Q1 2015 Q1 2016 Free cash flow of last twelve months decreased Net financial position remains positive by €27.8 million (1) Free cash flow: cash flow from operat
Slide 16: Equity ratio & funding
Equity ratio & funding € million 1,088.1 1,099.6 45.5% 45.1% 495.6 495.4 160 15 16 39 1 2015 Q1 2016 up to up to up to up to 1 year 2 years 5 years 10 years Total assets Equity xx.x% Equity ratio Repayment schedule Duration of credit lines Equity ratio remained strong Medium- to long-term financing
Slide 17: Summary
Summary Q1 business development in line with expectations Operating profit increased quarter over quarter Continuous focus on improvement of flexibility Positive customer feedback on extended product portfolio DEUTZ TCD 2.2 – 16.0 litre engines “Stage V ready” Strong balance sheet and financial posi
Slide 18: Agenda
Agenda Review Q1 2016 Outlook Annex Q1 2016 results 3 May 2016 18
Slide 19: Market assessment
Market assessment 2016 Unit sales (equipment)(1) Construction equipment Europe -5% to +5% Construction equipment North America -5% to +5% Construction equipment China -20% to -10% Agricultural Machinery Europe -5% to 0% Automotive China -5% to +5% Recovery of key application markets not yet visible
Slide 20: Financial outlook
Financial outlook FY 2015 FY 2016 € million reported guidance Revenue 1,247.4 stagnant or slight increase EBIT margin (before one-off items) 0.4% moderate increase R&D expenditure(1) 40.8 slightly above 50 Capex (excl. R&D)(1) 56.2 approx. 55 (1) Net of reimbursements Q1 2016 results 3 May 2016 20
Slide 21: Agenda
Agenda Review Q1 2016 Outlook Annex Q1 2016 results 3 May 2016 21
Slide 22: Summary of key financials (I)
Summary of key financials (I) € million Q1 2016 Q1 2015 Change (%) Revenue 300.2 318.1 -5.6 EBITDA (before one-off items) 31.3 33.9 -7.7 EBIT (before one-off items) 7.3 10.1 -27.7 EBIT margin (%) 2.4 3.2 -- Net income 8.7 7.7 13.0 Basic earnings per share (€) 0.08 0.07 14.3 Number of employees (31 M
Slide 23: Summary of key financials (II)
Summary of key financials (II) € million Q1 2016 Q1 2015 Change (%) Total assets 1,099.6 1,195.6 -8.0 Equity 495.4 526.5 -5.9 Equity ratio (%) 45.1 44.0 -- Cash flow from operating activities -8.0 12.4 -- Free cash flow(1) -28.9 -1.1 -- Net financial position 9.7 15.5 -- Working capital 229.4 245.4
Slide 24: Income statement
Income statement € million Q1 2016 Q1 2015 Change (%) Revenue 300.2 318.1 -5.6 Cost of sales -241.5 -264.1 -8.6 Research and development costs -19.2 -18.5 3.8 Selling expenses -17.3 -17.4 -0.6 General and administrative expenses -8.8 -8.6 2.3 Other operating income 3.6 12.6 -71.4 Other operating exp
Slide 25: Balance sheet: assets
Balance sheet: assets 31 March 31 Dec Change € million 2016 2015 (%) Non-current assets (before deferred tax assets) 510.0 520.5 -2.0 Deferred tax assets 77.0 69.1 11.4 Inventories 273.9 251.9 8.7 Trade receivables 123.1 101.2 21.6 Other receivables and assets 35.5 32.5 9.2 Cash and cash equivalents
Slide 26: Balance sheet: equity and liabilities
Balance sheet: equity and liabilities 31 March 31 Dec Change € million 2016 2015 (%) Equity 495.4 495.6 -0.0 Provisions for pensions and other post-retirement benefits 179.3 172.3 -4.2 Other provisions 46.9 46.7 -19.7 Financial liabilities 54.8 58.6 -25.2 Other liabilities 3.0 3.2 -23.1 Non-current
Slide 27: Cash flow statement (condensed)
Cash flow statement (condensed) € million Q1 2016 Q1 2015 EBIT 7.3 10.1 Cash flow from operating activities (total) -8.0 12.4 Capital expenditure on intangible assets, property, plant and equipment and investments -19.9 -13.0 Proceeds from the sale of non-current assets 0.0 0.6 Cash flow from invest
Slide 28: Overview of segments, Q1 2016
Overview of segments, Q1 2016 Q1 Q1 Change Q1 Q1 Change New orders (€ million) 2016 2015 (%) Unit sales 2016 2015 (%) DEUTZ Compact Engines 259.4 248.9 4.2 DEUTZ Compact Engines 29,770 33,595 -11.4 DEUTZ Customised Solutions 67.9 72.1 -5.8 DEUTZ Customised Solutions 2,342 3,312 -29.3 Total for opera
Slide 29: Employees
Employees 31 March 31 March Change 2016 2015 (%) Cologne 2,237 2,393 -6.5 Ulm 408 375 8.8 Other German operations 222 278 -20.1 Germany 2,867 3,046 -5.9 Foreign operations 832 804 3.5 DEUTZ Group 3,699 3,850 -3.9 Q1 2016 results 3 May 2016 29
Slide 30: Financial calendar & contact details
Financial calendar & contact details Interim report 1st half 2016 4 August 2016 Interim management statement 1st to 3rd quarter 2016 8 November 2016 Contact details Christian Krupp Tel:+49 (0) 221 822 5400 SVP Finance, Public and Investor Relations Fax:+49 (0) 221 822 15 5400 Ottostrasse 1 Email: kr
Slide 31: Disclaimer
Disclaimer Unless stated otherwise, all the figures given in this presentation refer to continuing operations. The details given in this document are based on the information available at the time it was prepared. This presents the risk that actual figures may differ from forward-looking statements.