Deutz Ag · XETR:DEZ
Deutz — Investor Presentation (August 2012)
24 slides from Deutz's investor presentation, August 2012
Slide 1: DEUTZ AG Investor Presentation – powering success
DEUTZ AG Investor Presentation – powering success August 2012
Slide 2: Agenda
Agenda DEUTZ at a glance Strategy & investment rationale Financials Outlook
Slide 3: DEUTZ – at a glance
DEUTZ – at a glance Innovations since over 145 years Global player in non-captive market Independent manufacturer of diesel engines, Engineering and manufacturing company product range from 25 to 520 kW with strong expertise as system integrator Founded in 1864 and since then synonymous for Producti
Slide 4: DEUTZ Group
DEUTZ Group DEUTZ Group DEUTZ Compact Engines DEUTZ Customised Solutions Liquid-cooled engines of up to 8 litre cubic capacity Air-cooled engines for on-road, off-road and marine for on- and off-road applications applications Large number of modular approaches to design Liquid-cooled engines of over
Slide 5: Product portfolio: ready for the next emissions level
Product portfolio: ready for the next emissions level Engines for Tier 4 emissions standards Focus on mobile machinery and agricultural segment Award winning new engine Mobile Agricultural Stationary Automotive (TC)D 2.9 Very compact engine minimizes Machinery Machinery Equipment installation effort
Slide 6: DEUTZ market share by application
DEUTZ market share by application Typical Markets will benefit from DEUTZ DEUTZ Segment macro trends Main Competitor Application Market Share Market Pos. Construction Equipment, Mobile Ground Support Cummins, Kubota, Machinery Equipment, Material 21% 1 Perkins, Yanmar Handling Equipment, Mining Equi
Slide 7: Revenue split
Revenue split Revenue split by application, 2011(1) Revenue split by region, 2011(2) (2010) (2010) Mobile Other 5% Machinery 35% Africa/Middle East 6% Europe (excl. Germany) 56% €76.0 million €529.4 million €87.8 million (€73.0 million) €860.6 million (€50.3 million) (€369.6 million) (€682.1 million
Slide 8: Agenda
Agenda DEUTZ at a glance Strategy & investment rationale Financials Outlook
Slide 9: Milestones – Profitable growth strategy implemented
Milestones DEUTZ Investment Attractions MOVE (cost cutting program) MOVE Fast (top line program) Tier 4 engines development JV DEUTZ Engine (Shandong) Extension Volvo cooperation 2008 2012 Profitable growth strategy implemented 9
Slide 10: Cost reduction & margin increase
Cost reduction & margin increase DEUTZ Investment Attractions (cont’d) Permanent cost reduction of €85 284 million realized (MOVE) 252 234 231 Breakeven volume reduced significantly 168 118 Complete restructuring of 91.2 business processes towards 84.2 smart SMEs 53.2 42.2 21.7 Top line project will
Slide 11: Multiple growth opportunities – leading to economies of scale
Multiple growth opportunities – leading to economies of scale DEUTZ Investment Attractions (cont’d) New emission standards require more complex engines with more inherent value New production facilities in China will lead to significant growth in Asia in upcoming years Outsourcing opportunities as a
Slide 12: Continued focus on the service business
Continued focus on the service business DEUTZ Investment Attractions (cont’d) Installed base of about 1.6 million engines 242 212 216 204 Service growth supported by 180 175 MOVE FAST project More active management of service network with improved training and tools Increased complexity of new emiss
Slide 13: Growth activities in China
Growth activities in China DEUTZ Investment Attractions (cont’d) DEUTZ Engine Chinese JV with Weifang Weichai DEUTZ (Dalian) (Shandong) Co., Ltd. AB Volvo DEUTZ Diesel Engine Co., Ltd.(2) (in foundation)(1) (MoU-status)(1) Engine Co., Ltd.(2) Province Shandong To be discussed Liaoning Shandong Shand
Slide 14: Extended long-term cooperation with Volvo
Extended long-term cooperation with Volvo DEUTZ Investment Attractions (cont’d) Breakdown of shareholders 6.7% 25.0% 26.7% Current Future 8.4% 66.6% 66.6% Volvo SAME DEUTZ-FAHR Free float Volvo announced to purchase more than 22 million DEUTZ shares from SAME DEUTZ-FAHR subject to antitrust clearanc
Slide 15: Sound financial position & funding
Sound financial position & funding DEUTZ Investment Attractions (cont’d) € million 1,099.0 1,110.3 1,041.7 35.9% 41.3% 42.1% 453.5 467.9 374.3 204 48 2010 2011 H1 2012 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 (residual term) Ne
Slide 16: Agenda
Agenda DEUTZ at a glance Strategy & investment rationale Financials Outlook
Slide 17: Key developments H1 2012
Key developments H1 2012 Positive Negative Signing of founding documents for Chinese Renewed economic downturn – JV DEUTZ Engine Shandong European sovereign debt crisis and current market weakness in China Exploring the extension of our long-term cooperation with Volvo Lower profit contribution of J
Slide 18: Sales figures
Sales figures Order Intake Unit Sales Revenue € million Units € million -12.1% -12.4% -6.0% 797.1 107,198 701.0 12,247 93,853 724.1 159.4 681.0 9,242 159.5 152.2 146.2 94,951 637.7 84,611 564.6 548.8 534.8 H1 2011 H1 2012 H1 2011 H1 2012 H1 2011 H1 2012 Revenue decreased less than unit sales due to
Slide 19: Revenue development
Revenue development € million 405.5 388.1 399.4 368.7 336.0 336.9 344.1 298.1 285.9 236.4 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Very strong revenue growth in 2011 Uncertainty of customers about European growth prospects had an impact on revenues in Q2 2012 2011 revenue record l
Slide 20: EBIT
EBIT 44.3 € million 23.4 21.6 11.3 10.3 27.4 21.2 15.2 12.2 -1.0 0.1 -0.3 -4.9 -0.9 -0.9 -4.0 H1 2011 H1 2012 Q1 2012 Q2 2012 EBIT margin 6.1% 3.2% 3.1% 3.3% EBIT decreased by €22.7 million in H1 2012 mainly due to lower production volumes and lower profit contribution of Joint Ventures Replacement
Slide 21: Agenda
Agenda DEUTZ at a glance Strategy & investment rationale Financials Outlook
Slide 22: Financial outlook
Financial outlook Outlook for 2012 Revenue €1.3 billion – €1.4 billion EBIT margin 3.0 % - 4.0 % Research and Development (R&D) Decline by about 25 % vs. 2011 Capex (excl. R&D) Approx. €60 million Free cash flow Positive territory Working capital ratio Below 13 % Equity ratio Above 40 % New outlook
Slide 23: Financial calendar and Contact
Financial calendar Contact 8 Nov 2012 Q3 results Christian Krupp Senior VP Finance and Investor Relations 19 Mar 2013 FY 2012 results Ottostrasse 1 30 Apr 2013 AGM 51149 Cologne (Porz-Eil), Germany Tel.: +49 (0) 221 822 5400 Fax: +49 (0) 221 822 15 5400 Email: krupp.c@deutz.com www.deutz.com 23
Slide 24: 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.