Nokian Renkaat Oyj · OMXHEX:TYRES
Nokian Renkaat Oyj — Nokian Tyres — Q2 2020 Earnings Presentation
18 slides from Nokian Renkaat Oyj's earnings presentation, Aug 4, 2020
Slide 1: COVID-19 and Russia impacting second quarter – strong balance sheet supporting in difficult times
COVID-19 AND RUSSIA IMPACTING SECOND QUARTER – STRONG BALANCE SHEET SUPPORTING IN DIFFICULT TIMES AUGUST 4, 2020 JUKKA MOISIO PRESIDENT AND CEO
Slide 2: Q2 hit by COVID-19 related economic slowdown
Q2 HIT BY COVID-19 RELATED ECONOMIC SLOWDOWN • Net sales EUR 270.7 million (415.7), -31.9% with comparable currencies • Decline due to COVID-19 and measures taken to reduce high carry-over stocks in the Russian distribution channel • Segments operating profit EUR 24.4 million (98.8) • Negatively imp
Slide 3: Key figures
KEY FIGURES Cash flow turned positive in Q2, balance sheet strong EUR million 4–6 4–6 Change CC* 1–6 1–6 Change CC* 2019 /20 /19 % Change /20 /19 % Change % % Net sales 270.7 415.7 -34.9% -31.9% 550.5 756.1 -27.2% -25.0% 1,585.4 Segments operating profit 24.4 98.8 40.8 155.5 337.2 Segments operating
Slide 4: New car sales and car tire sell-in dropped heavily in 1–6/2020
NEW CAR SALES AND CAR TIRE SELL-IN DROPPED HEAVILY IN 1–6/2020 The Nordic countries Russia Europe (excl. the Nordic countries) North America New car sales -25% New car sales -23% New car sales -40% New car sales -25% Car tire sell-in -11% Car tire sell-in -33% Car tire sell-in -19% Car tire sell-in
Slide 5: Q2: Passenger car tyres
Q2: PASSENGER CAR TYRES Production adjusted to weakening demand 4–6 4–6 Change CC* 1–6 1–6 Change CC* 2019 /20 /19 % Change /20 /19 % Change % % Net sales, M€ 163.9 296.8 -44.8% -42.0% 354.4 549.8 -35.5% -33.4% 1,123.8 Segment operating 13.6 84.7 39.5 150.7 308.5 profit, M€ Segment operating 8.3% 28
Slide 6: Q2: Passenger car tyres bridge
Q2: PASSENGER CAR TYRES BRIDGE Negative impact of 59 M€ from volume on segment operating profit NET SALES, M€ 350 -44,8% 297 -124 300 250 200 -1 172 -8 164 150 -41,7% -0,3% -2,8% 0 Q2/2019 Sales Volume Price/Mix Net Sales excl Currency Q2/2020 FX effect SEGMENT OPERATING PROFIT, M€ 100 Unabsorbed SC
Slide 7: Q2: Heavy tyres
Q2: HEAVY TYRES Weaker OE demand impacted net sales 4–6 4–6 Change CC* 1–6 1–6 Change CC* 2019 /20 /19 % Change /20 /19 % Change % % Net sales, M€ 40.5 47.8 -15.3% -13.1% 91.6 96.1 -4.6% -3.3% 202.7 Segment operating 2.6 8.3 10.8 17.3 35.7 profit, M€ Segment operating 6.4% 17.4% 11.8% 18.0% 17.6% pr
Slide 8: Q2: Vianor
Q2: VIANOR Excellent performance in difficult circumstances 4–6 4–6 Change CC* 1–6 1–6 Change CC* 2019 /20 /19 % Change /20 /19 % Change % % Net sales, M€ 80.8 89.8 -9.9% -5.4% 135.3 146.7 -7.8% -3.9% 336.5 Segment operating 9.6 9.4 -2.8 -2.6 7.7** profit, M€ Segment operating 11.8% 10.4% -2.1% -1.8
Slide 9: Our priorities are clear
OUR PRIORITIES ARE CLEAR • Providing customers with world-class products and services • Keeping costs in strict control • Protecting cash flow by cutting back investments, managing working capital, and delaying activities → With a valued brand, strong expertise and enhanced production capacity, we a
Slide 10: Peace of mind in all conditions
PEACE OF MIND IN ALL CONDITIONS
Slide 11: Appendix
APPENDIX 11
Slide 12: Group operating profit per quarter 2016–H1/2020
APPENDIX GROUP OPERATING PROFIT PER QUARTER 2016–H1/2020 1–6/2020 CUMULATIVE OPERATING PROFIT PER REVIEW PERIOD 380 330 • Net sales 550.5 M€ 280 (756.1), -27.2% 230 M€ 180 130 • Operating profit -13.7 M€ 80 (148.0) 30 -20 1–3 1–6 1–9 1–12 4–6/2020 GROUP OPERATING PROFIT PER QUARTER 150 • Net sales 2
Slide 13: H1: Passenger car tyres bridge
APPENDIX H1: PASSENGER CAR TYRES BRIDGE Negative impact of 87 M€ from volume on segment operating profit NET SALES, M€ 600 -35,5% 550 -181 550 500 450 400 -3 366 -12 354 350 -33,0% -0,5% -2,1% 0 1-6/2019 Sales Volume Price/Mix Net Sales excl Currency 1-6/2020 FX effect SEGMENT OPERATING PROFIT, M€ 1
Slide 14: Passenger car tyres net sales - quarterly changes
APPENDIX PASSENGER CAR TYRES NET SALES - QUARTERLY CHANGES YoY Change % Sales Volumes Price/Mix Currency 1,5% 1,7% 2,1% 1,9% 2,1% 0,5% -0,9% -5,0% -6,5% -0,8% -0,8% -0,7% -0,3% -1,8% -1,3% -2,8% -22,7% -41,7% Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1 Q2 2019 2020 2019 2020 2019 2020 14
Slide 15: Material cost development
APPENDIX MATERIAL COST DEVELOPMENT Decreased in H1/2020 MATERIAL COST DEVELOPMENT INDEX 2010–E2020 140 131 131 MATERIAL COSTS 130 (€/KG) 120 114 • Decreased by 4.3% in Q2/2020 110 100 vs. Q2/2019 100 96 92 92 96 90 85 • Increased by 2.8% in Q2/2020 83 79 80 vs. Q1/2020 70 2010 2011 2012 2013 2014 20
Slide 16: Net debt and debt maturities
APPENDIX NET DEBT AND DEBT MATURITIES Net Debt Debt Maturities Q2/2020 Q2/2019 Q2/2020 700 700 400 400 350 350 600 107 600 300 125 300 500 500 250 250 EUR million EUR million 400 269 400 25 14 200 200 59 300 126 300 150 150 11 200 200 210 200 100 100 100 282 151 124 100 100 50 50 135 18 14 26 0 0 1
Slide 17: Network development progressed
APPENDIX NETWORK DEVELOPMENT PROGRESSED NAD Vianor, NAD, N-Tyre; +25 stores in 1–6/2020 N-TYRE VIANOR VIANOR – 1,152 SERVICE CENTERS ICELAND IN 18 COUNTRIES 4 186 own stores and 966 partners USA 10 260 Own -3, partner -15 vs. year-end 2019 NORWAY SWEDEN FINLAND 133 99 107 • Largest tire chain in the
Slide 18: 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