Slide 1: ALV – Q4-2020 Earnings Call and Webcast
1 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 2: Forward-looking statements
This presentation contains statements that are not historical facts but rather forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include those that address activities, events or developments that Autoliv, Inc. or it
Slide 3: Record sales, profits and cash flow
▪ Record sales − Sales developed stronger than expected − Record sales, for the passive safety business, in all regions as we executed on our strong order book − Economic uncertainty, risk for further lockdowns, and the threat of increasing unemployment temper the outlook for 2021 ▪ Record profits −
Slide 4: Consolidated Sales, Adjusted Operating Income, Operating Cash Flow
Consolidated Sales Adjusted Operating Income* Operating Cash Flow US$ (Millions) US$ (Millions) US$ (Millions) 15% 69M 157M 12.4% Adj. $469 $2,517 Op. Margin* 11.1% Adj. Op. Margin* $311 $2,191 $312 $242 Q4´19 Q4´20 Q4´19 Q4´20 Q4´19 Q4´20 (*) Non-US GAAP measures exclude costs for capacity alignmen
Slide 5: Regional Organic Growth vs. LVP
Regional Organic Growth* vs. LVP** EUROPE JAPAN AMERICAS CHINA REST OF ASIA (*) Non-US GAAP measure (**) Light Vehicle Production (LVP) according to IHS Markit @ January 2021 5 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 6: "First Love" vehicle launches
Isuzu MU-X Toyota Sienna Subaru Levorg Dacia Sandero Haval “First Love” VW ID.4 Arcfox Alpha-T VW Taos Toyota Yaris Cross 6 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 7: Order Intake Lifetime Sales and Share
Order Intake Lifetime Sales* and Share ▪ Win-rate higher than today’s market share level ~50% ▪ Substantially lower sourcing activities than in ~50% ~50% >50% previous years ~50% Lifetime Sales (MUSD) ~45% ▪ Wins with all leading OEMs including pure EV makers ~37% ▪ Sourcing of several business awar
Slide 8: Q4'20 vs Q4'19 financial summary
(US $ Millions unless specified) Q4’20 Q4’19 Sales $2,517 $2,191 Gross Profit $502 19.9% $427 19.5% Adj. Operating Income1 $311 12.4% $242 11.1% EPS (assuming dilution) $2.15 $1.78 Adj. RoCE1,2 33% 26% Adj. RoE1,2 33% 31% Operating cash flow $469 $312 Dividend paid per share - $0.62 Global LVP3 (ann
Slide 9: Operating margin bridge
130 bps 180 bps Operations 70 bps 12.4% 50 bps + Pos 50 bps 220 bps** 11.1% • Higher sales • Productivity improvement in material and personnel cost • Structural efficiency programs - Neg • Inefficiencies related to COVID-19 • Direct costs related to COVID-19 (*) Non-US GAAP measures exclude costs f
Slide 10: Capex and D&A, cash flow
Capex and D&A (US$ Millions unless specified) Q4’20 Q4’19 2020 2019 Net Income $189 $156 $188 $463 Depreciation & Amortization 103 91 371 351 EC antitrust payment - - - -203 Other, net 64 (19) 13 -17 Change in operating WC 113 85 276 47 Operating cash flow 469 312 849 641 Cash Conversion2 Operating
Slide 11: Net Debt / EBITDA
Net Debt/ EBITDA* Net Debt and EBITDA per the Policy x $2,000 3.0 2.5 $1,500 1.8x 2.0 $1,000 1.5 0.5-1.5x $500 Long-Term Target: 1.0x Q1´19 Q2´19 Q3´19 Q4´19 Q1´20 Q2´20 Q3´20 Q3´21 1.0 Long-Term Range Net Debt EBITDA 0.5 ▪ Our Net Debt* decreased by $350M from Q3’20 0.0 ▪ EBITDA LTM increased by $7
Slide 12: Full year 2020 financial summary
(US $ Millions unless specified) 2020 2019 Sales $7,447 $8,548 Gross Profit $1,247 16.7% $1,584 18.5% Adj. Operating Income1 $482 6.5% $774 9.1% EPS (assuming dilution) $2.14 $5.29 Adj. RoCE1,2 13% 21% Adj. RoE1,2 13% 25% Operating cash flow1 $849 $844 Dividend paid per share $0.62 $2.48 Global LVP3
Slide 13: Light vehicle production assumptions for FY21
IHS Markit: Light Vehicle Production* Q1´21 FY´21 Region YoY Million Y-o-Y Chg. Units Chg. Assumption for the FY21: China 67.9% 23.6 6.7% Japan -0.3% 8.2 7.6% Rest of Asia -0.1% 11.0 15.6% North American LV sales are forecast to bounce back in 2021 with a ~10% increase to ~18.5 North America 7.9% 15
Slide 14: ALV – Q4-2020 Earnings Call and Webcast
14 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 15: ALV – Q4-2020 Earnings Call and Webcast
15 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 16: Full year 2021 indication
Full year indication Sales, net Around 25% Exchange rates3 FY’21 Organic sales increase1 Around 20% EUR / US$ 1.213 Org. sales outperformance vs. LVP Mid-single digits US$ / JPY 103.7 FX Around 5% US$ / KRW 1099 US$ / MXN 19.80 Adjusted Operating margin1 Around 10% US$ / CNY 6.47 Tax rate2 Around 30
Slide 17: Visible Short-term and Long-Term Growth vs. LVP
Profitability Visible Short-term Cash Flow Strong Balance Improvement and and Long-Term Generation Focus for Sheet and Prudent Over-the-Cycle Growth vs. LVP Shareholder Returns Leverage Policy Resilience 17 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 18: Our Priorities
Our Priorities ✓ Saving more lives ✓ Health & Safety – Zero Accidents ✓ Increase resource efficiency and reduce carbon footprint ✓ Prevent corruption and anti-competitive behavior ✓ Manage the sustainability risks in our supply chain 18 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 19: Non-GAAP footnotes and targets
≥ (1) Non-US GAAP measure excludes costs related to Antitrust matters. The forward looking non-U.S. GAAP financial measures herein are provided on a non-U.S. GAAP basis. Autoliv has not provided a U.S. GAAP reconciliation of these measures because items that impact these measures, such as costs rela
Slide 20: Implementing Strategic Initiatives
Implementing Strategic Initiatives Stabilization of market fundamentals 3 Executing on strong order book 2 1 20 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 21: Order Intake and medium term organic growth
Order Intake Sales: Medium term organic growth ~50% ~50% ~50% >50% ~50% Lifetime Sales (MUSD) ~45% $8.5 Bn ~37% 2014 2015 2016 2017 2018 2019 2020 2019 Medium Term 21 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 22: IHS Markit's LVP Assumption
2 IHS Markit’s LVP Assumption IHS Markit Nov 2019 100 95 ~7 M units 90 85 80 Current IHS Markit Forecast* 75 70 65 60 2017 2018 2019 2020 2021 2022 2023 2024 * Light Vehicle Production (LVP) according to IHS Markit @ January 2021 22 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 23: Restructuring program and savings
2 ▪ Substantially completed by second quarter 2021 ▪ Cost in Q4´20 was ~$5 million ▪ Announced plant closure plans 2020 FY2021 Expected for program • ~200 employees affected in Germany FY Q4 • ~150 employees affected in Sweden Cost ~$65M - - ~$65M ▪ Evaluating further footprint optimization Cash out
Slide 24: Automation implementation examples
3 Example of implementations: • Textile Assembly Automation • Initiator molding • Steering wheel Foaming • Quality Inspection • Textile Material handling • AIV for component deliveries ….. more in the pipeline supported by end-to-end activities to achieve set targets 24 January 26, 2021 ALV – Q4-202
Slide 25: Cost reduction, supply risk management, days payable
3 Year-on-Year cost reduction Supply Risk Management ▪ Expanded supplier monitoring on Direct Material in the full Supply Chain 2020 Y-o-Y Savings: ▪ Digitalized real-time data intelligence & early warning detection through visual monitoring 11% ▪ Used financial monitoring software to predict suppli
Slide 26: RD&E effectiveness
3 Reduction of RD&E in relation RD&E to sales to Effectiveness historical level ▪ Engineering 4.0 Strategy: simplification, automation, and smart connection of systems, > 50 projects in the data, processes & tools pipeline ▪ Strong pace in the execution of improvement projects ▪ Specific developed C
Slide 27: Summary priorities
▪ Health and Safety continue to be top priority ▪ Executing our Strategic initiatives ▪ Deliver on our strong order book ▪ Manage Light Vehicle Market Volatility ▪ Defend our Medium-term Market Share Position ▪ Saving More Lives 27 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 28: ALV – Q4-2020 Earnings Call and Webcast
28 January 26, 2021 ALV – Q4-2020 Earnings Call and Webcast
Slide 29: Autoliv
Le “Autoliv —
Slide 30: Autoliv Quantities Delivered Q4'20 vs. PY
Autoliv Quantities Delivered Q4´20 vs. PY** (%) (Millions unless specified) Seatbelts 40.5 6% ▪ Pretensioners (of which) 24.5 12% ▪ Active Seatbelts (of which) 1.7 16% Frontal Airbags 16.5 9% ▪ Knee Airbags (of which) 1.8 21% Side Airbags 28.5 14% ▪ Chest (Thorax) 15.7 12% ▪ Head (Curtain) 12.7 15%
Slide 31: Autoliv Quantities Delivered FY'20 vs. PY
Autoliv Quantities Delivered FY´20 vs. PY** (%) (Millions unless specified) Seatbelts 125.5 -14% ▪ Pretensioners (of which) 74.8 -6% ▪ Active Seatbelts (of which) 5.4 -5% Frontal Airbags 48.6 -15.0% ▪ Knee Airbags (of which) 5.1 -6% Side Airbags 86.7 -12% ▪ Chest (Thorax) 47.8 -11% ▪ Head (Curtain)
Slide 32: ALV – Q4-2020 Earnings Call and Webcast
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