Deutz Ag · XETR:DEZ
Deutz — Q3 2016 Earnings Presentation
32 slides from Deutz's earnings presentation, Nov 8, 2016
Slide 1: Q1-Q3 2016 results
Q1-Q3 2016 results 8 November 2016 Dr Helmut Leube, CEO Dr Margarete Haase, CFO
Slide 2: Agenda
Agenda Review Q1-Q3 2016 Outlook Annex Q1-Q3 2016 results 8 November 2016 2
Slide 3: Key figures
Key figures Q1-Q3 2016 yoy Q3 2016 yoy € million New orders 935.3 +0.3% 258.1 -1.6% Revenue 945.5 +0.7% 301.1 +12.1% EBITDA 87.9 +2.7% 21.0 +38.2% EBIT 19.7 +€9.1 million -1.0 +€8.7 million Net income 18.8 +€11.5 million -1.2 +€8.2 million Free cash flow -28.0 -€18.5 million -10.8 +€24.9 million Q1-
Slide 4: Highlights
Highlights ■ Q1-Q3 2016 result in-line with expectations • Operating profit improvement due to of efficiency gains and better product mix • Site optimisation measures on track ■ Positive new business development • DEUTZ opens first Power Center in the United States to strengthen distribution • Sany
Slide 5: Sales figures
Sales figures New orders Unit sales Revenue € million Units € million +0.3% -6.3% +0.7% 932.9 935.3 107,236 938.8 945.5 100,439 9,640 7,129 208.9 191.6 208.7 195.8 97,596 93,310 724.0 743.7 730.1 749.7 Q1-Q3 2015 Q1-Q3 2016 Q1-Q3 2015 Q1-Q3 2016 Q1-Q3 2015 Q1-Q3 2016 New orders and revenue at previo
Slide 6: Revenue by quarter
Revenue by quarter € million 424.5 352.3 352.1 344.2 318.1 308.6 300.2 301.1 268.6 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Advance production of engines ahead of changes to European emissions standards for engines < 130 kW in October 2014 with significant influence on revenue Q3 revenu
Slide 7: Revenue split by region
Revenue split by region Q1-Q3 2016 (Q1-Q3 2015) Africa/Middle East 5 % Europe (excl. Germany) 47 % €47.2 million €442.0 million (€68.5 million) (€438.2 million) Asia-Pacific 11 % €109.3 million (€91.3 million) €945.5 million (€938.8 million) Americas 19 % Germany 18 % €180.9 million €166.1 million (
Slide 8: Revenue split by application
Revenue split by application Q1-Q3 2016 (Q1-Q3 2015) Other 3 % Mobile Machinery 42 % €27.1 million €399.8 million (€15.7 million) (€400.9 million) Automotive 6 % €60.9 million (€64.6 million) Stationary Equipment 12 % €945.5 million (€938.8 million) €112.9 million (€135.7 million) Agricultural Machi
Slide 9: Operating profit & net income
Operating profit & net income Q1-Q3 2015 Q1-Q3 2016 € million 85.6 75.0 87.9 68.2 9.1% 9.3% 19.7 2.8 +1.9 18.8 10.6 3.1 0.2 7.3 EBITDA D&A Net Income Net EBIT EBITDA D&A EBIT Net Tax Net interest taxes income interest income income expense expense EBITDA margin improved slightly despite lower unit s
Slide 10: EBIT
EBIT € million +1.6 -3.5 19.7 +11.0 10.6 Q1-Q3 2015 Q1-Q3 2016 EBIT margin 1.1% 2.1% EBIT improvement at DEUTZ Compact Engines on the back of lower production costs and better product mix Operating profit at DEUTZ Customised Solutions ahead of previous year’s level despite decrease in unit sales Res
Slide 11: Segment: DEUTZ Compact Engines
Segment: DEUTZ Compact Engines Q1-Q3 Q1-Q3 Change Q3 Q3 Change € million 2016 2015 in % € million 2016 2015 in % New orders 743.7 724.0 2.7 New orders 199.2 194.0 2.7 Unit sales 93,310 97,596 -4.4 Unit sales 28,503 26,243 8.6 Revenue 749.7 730.1 2.7 Revenue 237.2 201.8 17.5 EBIT -5.9 -16.9 65.1 EBIT
Slide 12: Segment: DEUTZ Customised Solutions
Segment: DEUTZ Customised Solutions Q1-Q3 Q1-Q3 Change Q3 Q3 Change € million 2016 2015 in % € million 2016 2015 in % New orders 191.6 208.9 -8.3 New orders 58.9 68.2 -13.6 Unit sales 7,129 9,640 -26.0 Unit sales 2,230 2,873 -22.4 Revenue 195.8 208.7 -6.2 Revenue 63.9 66.8 -4.3 EBIT 27.6 26.0 6.2 EB
Slide 13: R&D & capital expenditure
R&D & capital expenditure R&D expenditure Capital expenditure (excl. R&D) € million 41.6 40.4 36.3 38.5 0.4 Gross expenditure 2.0 6.5 Reimbursements Net expenditure 36.5 41.2 29.8 Net R&D Q1-Q3 2015 Q1-Q3 2016 Q1-Q3 2015 Q1-Q3 2016 expenditure ratio(1) 3.2% 3.9% R&D expenditure remains at moderate l
Slide 14: Working capital & operating cash flow
Working capital & operating cash flow Working capital Operating cash flow € million 231.1 239.4 43.6 22.3 Working Q1-Q3 2015 Q1-Q3 2016 Q1-Q3 2015 Q1-Q3 2016 capital ratio (30 Sep) 17.9% 19.1% Working capital increased by €8.3 million Operating cash flow decline mainly attributable to higher working
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 16.5 2.1 -3.1 2015 Q3 2016 (LTM) Q1-Q3 2015 Q1-Q3 2016 Last twelve months free cash flow below FY 2015 Net financial position slightly positive level as a result of lower operating cash flow (1
Slide 16: Equity ratio & funding
Equity ratio & funding € million 1,088.1 1,063.8 45.5% 46.2% 495.6 491.5 160 16 16 31 1 2015 Q1-Q3 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 Healthy balance sheet; equity ratio increased to 46.2% Me
Slide 17: Summary
Summary Closer cooperation with Liebherr planned New customer business attracted Site optimisation measures on track Margin improvement due to lower production costs Significant increase in net income Balance sheet remained strong Q1-Q3 2016 results 8 November 2016 17
Slide 18: Agenda
Agenda Review Q1-Q3 2016 Outlook Annex Q1-Q3 2016 results 8 November 2016 18
Slide 19: Market assessment
Market assessment 2016 Unit sales (equipment)(1) Construction equipment Europe 0% to +5% (previous: -5% to +5%) Construction equipment North America -5% to 0% -15% to -10% Construction equipment China (previous: -20% to -10%) Agricultural Machinery Europe -5% to 0% +5% to +10% Automotive China(2) (p
Slide 20: Financial outlook
Financial outlook FY 2015 FY 2016 € million reported guidance Revenue 1,247.4 stagnant or slight increase EBIT margin 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-Q3 2016 results 8 November 2016 20
Slide 21: Agenda
Agenda Review Q1-Q3 2016 Outlook Annex Q1-Q3 2016 results 8 November 2016 21
Slide 22: Summary of key financials (I)
Summary of key financials (I) € million Q1-Q3 2016 Q1-Q3 2015 Change (%) Revenue 945.5 938.8 0.7 EBITDA 87.9 85.6 2.7 EBIT 19.7 10.6 85.8 EBIT margin (%) 2.1 1.1 -- Net income 18.8 7.3 >100 Basic earnings per share (€) 0.16 0.07 >100 Number of employees (30 September) 3,695 3,755 -1.6 Q1-Q3 2016 res
Slide 23: Summary of key financials (II)
Summary of key financials (II) € million Q1-Q3 2016 Q1-Q3 2015 Change (%) Total assets 1,063.8 1,087.2 -2.2 Equity 491.5 500.9 -1.9 Equity ratio (%) 46.2 46.1 -- Cash flow from operating activities 22.3 43.6 -48.9 Free cash flow(1) -28.0 -9.5 <-100 Net financial position 2.1 -3.1 -- Working capital
Slide 24: Income statement
Income statement € million Q1-Q3 2016 Q1-Q3 2015 Change (%) Revenue 945.5 938.8 0.7 Cost of sales -775.6 -792.4 -2.1 Research and development costs -58.8 -53.4 10.1 Selling expenses -51.9 -52.1 -0.4 General and administrative expenses -26.2 -26.8 -2.2 Other operating income 10.6 19.1 -44.5 Other ope
Slide 25: Balance sheet: assets
Balance sheet: assets 30 Sep 31 Dec Change € million 2016 2015 (%) Non-current assets (before deferred tax assets) 490.0 520.5 -5.9 Deferred tax assets 84.6 69.1 22.4 Inventories 278.4 251.9 10.5 Trade receivables 112.9 101.2 11.6 Other receivables and assets 30.7 32.5 -5.5 Cash and cash equivalents
Slide 26: Balance sheet: equity and liabilities
Balance sheet: equity and liabilities 30 Sep 31 Dec Change € million 2016 2015 (%) Equity 491.5 495.6 -0.8 Provisions for pensions and other post-retirement benefits 182.2 172.3 5.7 Deferred tax liabilities 0.6 0.0 >100 Other provisions 43.8 46.7 -6.2 Financial liabilities 47.0 58.6 -19.8 Other liab
Slide 27: Cash flow statement (condensed)
Cash flow statement (condensed) € million Q1-Q3 2016 Q1-Q3 2015 EBIT 19.7 10.6 Cash flow from operating activities (total) 22.3 43.6 Capital expenditure on intangible assets, property, plant and equipment and investments -47.6 -50.9 Proceeds from the sale of non-current assets 0.1 0.9 Cash flow from
Slide 28: Overview of segments, Q1-Q3 2016
Overview of segments, Q1-Q3 2016 Q1-Q3 Q1-Q3 Change Q1-Q3 Q1-Q3 Change New orders (€ million) 2016 2015 (%) Unit sales 2016 2015 (%) DEUTZ Compact Engines 743.7 724.0 2.7 DEUTZ Compact Engines 93,310 97,596 -4.4 DEUTZ Customised Solutions 191.6 208.9 -8.3 DEUTZ Customised Solutions 7,129 9,640 -26.0
Slide 29: Overview of segments, Q3 2016
Overview of segments, Q3 2016 Q3 Q3 Change Q3 Q3 Change New orders (€ million) 2016 2015 (%) Unit sales 2016 2015 (%) DEUTZ Compact Engines 199.2 194.0 2.7 DEUTZ Compact Engines 28,503 26,243 8.6 DEUTZ Customised Solutions 58.9 68.2 -13.6 DEUTZ Customised Solutions 2,230 2,873 -22.4 Total for operat
Slide 30: Employees
Employees 30 Sep 30 Sep Change 2016 2015 (%) Cologne 2,212 2,298 -3.7 Ulm 414 405 2.2 Other German operations 219 234 -6.4 Germany 2,845 2,937 -3.1 Foreign operations 850 818 3.9 DEUTZ Group 3,695 3,755 -1.6 Q1-Q3 2016 results 8 November 2016 30
Slide 31: Financial calendar & contact details
Financial calendar & contact details Annual report FY 2016 16 March 2017 Annual general meeting 4 May 2017 Q1 2017 result 9 May 2017 H1 2017 result 3 August 2017 Q1-Q3 2017 result 7 November 2017 Contact details Christian Krupp Tel:+49 (0) 221 822 5400 SVP Finance, Public and Investor Relations Fax:
Slide 32: 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.