Deutz Ag · XETR:DEZ
Deutz — Q1 2015 Earnings Presentation
32 slides from Deutz's earnings presentation, May 5, 2015
Slide 1: Q1 2015 results
Q1 2015 results 5 May 2015 Dr Helmut Leube, CEO Dr Margarete Haase, CFO
Slide 2: Agenda
Agenda Review Q1 2015 Outlook Annex Q1 2015 results 5 May 2015 2
Slide 3: Key figures
Key figures Q1 2015 Year-on-year € million Order intake 321.0 -22.5% Revenue 318.1 -7.2% EBITDA 33.9 +33.5% EBIT 10.1 +€8.2 million Net financial position 15.5 +€51.0 million Significant operating profit increase despite lower revenue Q1 2015 results 5 May 2015 3
Slide 4: Highlights
Highlights Group sales figures declined in line with our financial outlook Significant operating profit increase: Positive FX effects and compensation of negative scale effects by productivity enhancements Site optimisation measures in Germany well on track Consolidation of Chinese operations; focus
Slide 5: Stage V ready
Stage V ready 240 – 520 kW 160 – 291 kW 130 – 206 kW 85 – 115 kW 56 – 100 kW 37 – 56 kW TCD 2.9 to 7.8 litre engines with DPF already meet the next EU emission standard announced for 2019 DEUTZ technology platform offers our customers long-term planning certainty. They do not have to invest in adapt
Slide 6: Sales figures
Sales figures Order intake Unit sales Revenue € million Units € million -22.5% -17.0% -7.2% 414.2 44,457 2,801 69.6 36,907 342.7 321.0 3,312 318.1 55.9 72.1 67.1 41,656 344.6 33,595 248.9 286.8 251.0 Q1 2014 Q1 2015 Q1 2014 Q1 2015 Q1 2014 Q1 2015 Decline of sales figures mainly caused by previous y
Slide 7: Revenue development
Revenue development € million 410.1 410.7 424.5 372.2 381.0 342.7 352.3 318.1 289.9 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Current business impacted by the emission change on 1 October 2014 in Europe Q1 2015 results 5 May 2015 7
Slide 8: Service business
Service business Service revenue € million 11.3% 70.8 63.6 Q1 2014 Q1 2015 Strong resilience of profitable service business through different economic cycles Campaign “DEUTZ SERVICE Life Time Support” started Intensified focus on profitable service business Q1 2015 results 5 May 2015 8
Slide 9: Revenue split by region
Revenue split by region Q1 2015 (Q1 2014) Africa/Middle East 6 % Europe (excl. Germany) 46 % €19.3 million €145.3 million (€16.1 million) (€171.5 million) Asia-Pacific 9 % €29.7 million (€24.6 million) €318.1 million (€342.7 million) Americas 26 % Germany 13 % €81.9 million €41.9 million (€59.3 mill
Slide 10: Revenue split by application
Revenue split by application Q1 2015 (Q1 2014) Other 1 % Mobile Machinery 42 % €3.5 million €134.6 million Automotive 7 % (€4.3 million) (€153.0 million) €21.2 million (€20.8 million) Agricultural Machinery 13 % €318.1 million €40.3 million (€342.7 million) (€64.8 million) Stationary Equipment 15 %
Slide 11: EBIT
EBIT(1) € million 10.1 1.9 11.0 7.1 4.0 -4.9 -4.9 -0.3 Q1 2014 Q1 2015 EBIT margin 0.6% 3.2% EBIT notably up by €8.2 million - both operating segments contributed to the profit improvement Substantial FX effects. Compensation of negative scale effects by higher service revenues as well as lower prod
Slide 12: Operating profit & net income
Operating profit & net income Q1 2014 Q1 2015 € million 33.9 23.8 25.4 23.5 10.1 1.1 1.3 7.7 1.9 1.7 0.8 -0.6 EBITDA D&A EBIT Net Income Net EBITDA D&A EBIT Net Income Net interest taxes income interest taxes income expense expense EBITDA increased by €8.5 million (+33.5% year-on-year) Net interest
Slide 13: R&D & capital expenditure
R&D & capital expenditure R&D Capital expenditure (excl. R&D) € million Gross expenditure 19.1 4.7 Reimbursements 13.7 2.8 8.2 8.5 Net expenditure 0.3 0.1 14.4 10.9 7.9 8.4 Net R&D Q1 2014 Q1 2015 Q1 2014 Q1 2015 expenditure ratio(1) 4.2% 3.4% After all engines designed for the latest emission Capit
Slide 14: Working capital & operating cash flow
Working capital & operating cash flow Working capital Operating cash flow € million 245.4 202.2 12.4 9.4 Working Q1 2014 Q1 2015 Q1 2014 Q1 2015 capital ratio (31 March) 13.4% 16.3% Working capital increased at the end of Q1 2015 Operating cash flow increased by €3.0 million Inventories raised by FX
Slide 15: Free cash flow generation & net financial position
Free cash flow generation & net financial position Free cash flow Net financial position € million 15.5 52.0 54.1 -35.5 2014 Q1 2015 (LTM) Q1 2014 Q1 2015 Free cash flow of last twelve months improved Net financial position improved by €51.0 million compared to the last quarter Free cash flow used t
Slide 16: Equity ratio & funding
Equity ratio & funding € million 1,149.2 1,195.6 44.5% 44.0% 511.0 526.5 208 15 15 8 2014 Q1 2015 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 Sound balance sheet; equity ratio >40% Medium- to long-term fin
Slide 17: Segments: DEUTZ Compact Engines
Segments: DEUTZ Compact Engines Q1 Q1 Change € million 2015 2014 in % New orders 248.9 344.6 -27.8 Unit sales 33,595 41,656 -19.4 Revenue 251.0 268.8 -12.5 EBIT 4.0 -4.9 >100 Mixed growth dynamics: Revenue increased in Stationary Equipment (+34.8%) and Service (+7.7%). Revenue declined in Agricultur
Slide 18: Segments: DEUTZ Customised Solutions
Segments: DEUTZ Customised Solutions Q1 Q1 Change € million 2015 2014 in % New orders 72.1 69.6 3.6 Unit sales 3,312 2,801 18.2 Revenue 67.1 55.9 20.0 EBIT 11.0 7.1 54.9 All applications with strong growth momentum, e.g. Automotive (+26.4%), Stationary Equipment (+22.1%) and Mobile Machinery (+12.7%
Slide 19: Summary
Summary Demand impacted by prior year’s pre-buys Operating profit increase in both segments “Stage V ready”-campaign Focus of Chinese activities on DEUTZ Dalian Sound balance sheet Q1 2015 results 5 May 2015 19
Slide 20: Agenda
Agenda Review Q1 2015 Outlook Annex Q1 2015 results 5 May 2015 20
Slide 21: Financial outlook
Financial outlook FY 2014 reported Guidance FY 2015 € million Revenue 1,530.2 approx. -10 % EBIT margin (before one-offs) 2.1 % approx. 3 % Net R&D expenditure(1) 53.1 significant decline Capex (excl. R&D)(1) 40.3 ~ 50 (1) Net of reimbursements Group revenue expected to decline in FY 2015; slight re
Slide 22: Agenda
Agenda Review Q1 2015 Outlook Annex Q1 2015 results 5 May 2015 22
Slide 23: Summary of key financials (I)
Summary of key financials (I) € million Q1 2015 Q1 2014 Change (%) Revenue 318.1 342.7 -7.2 EBITDA 33.9 25.4 33.5 EBIT 10.1 1.9 >100 EBIT margin (%) 3.2 0.6 -- Net income 7.7 -0.6 >100 Basic earnings per share (€) 0.07 0.00 -- Number of employees (31 March) 3,850 4,042 -4.8 Q1 2015 results 5 May 201
Slide 24: Summary of key financials (II)
Summary of key financials (II) € million Q1 2015 Q1 2014 Change (%) Total assets 1,195.6 1,154.2 3.6 Equity 526.5 497.3 5.9 Equity ratio (%) 44.0 43.1 -- Cash flow from operating activities 12.4 9.4 31.9 Free cash flow -1.1 -3.2 -65.6 Net financial position 15.5 -35.5 >100 Working capital 245.4 202.
Slide 25: Income statement
Income statement € million Q1 2015 Q1 2014 Change (%) Revenue 318.1 342.7 -7.2 Cost of goods sold -264.1 -300.1 -12.0 Research and development costs -18.5 -16.3 13.5 Selling expenses -17.4 -16.6 4.8 Administrative expenses -8.6 -8.4 2.4 Other operating income 12.6 3.2 >100 Other operating expenses -
Slide 26: Balance sheet: assets
Balance sheet: assets 31 March 31 Dec Change € million 2015 2014 (%) Non-current assets (excluding deferred tax assets) 556.1 563.6 -1.3 Deferred tax assets 70.0 62.2 12.5 Inventories 277.6 245.2 13.2 Trade receivables 146.2 122.0 19.8 Other receivables and assets 45.3 54.1 -16.3 Cash and cash equiv
Slide 27: Balance sheet: equity and liabilities
Balance sheet: equity and liabilities 31 March 31 Dec Change € million 2015 2014 (%) Equity 526.5 511.0 3.0 Provisions for pensions and other post-retirement benefits 197.1 187.1 5.3 Other provisions 57.2 58.4 -2.1 Financial liabilities 69.6 73.3 -5.0 Other liabilities 3.8 3.9 -2.6 Non-current liabi
Slide 28: Cash flow statement (condensed)
Cash flow statement (condensed) € million Q1 2015 Q1 2014 EBIT 10.1 1.9 Cash flow from operating activities (total) 12.4 9.4 Capital expenditure on intangible assets, property, plant and equipment and investments -13.0 -16.2 Proceeds from the sale of non-current assets 0.6 5.1 Cash flow from investi
Slide 29: Overview of segments, Q1 2015
Overview of segments, Q1 2015 Q1 Q1 Change Q1 Q1 Change New orders (€ million) 2015 2014 (%) Unit sales 2015 2014 (%) DEUTZ Compact Engines 248.9 344.6 -27.8 DEUTZ Compact Engines 33,595 41,656 -19.4 DEUTZ Customised Solutions 72.1 69.6 3.6 DEUTZ Customised Solutions 3,312 2,801 18.2 Total for opera
Slide 30: Employees
Employees 31 March 31 March Change 2015 2014 (%) Cologne 2,393 2,426 -1.4 Ulm 375 393 -4.6 Other German operations 278 281 -1.1 Germany 3,046 3,100 -1.7 Foreign operations 804 942 -14.6 DEUTZ Group 3,850 4,042 -4.8 Q1 2015 results 5 May 2015 30
Slide 31: Financial calendar & contact details
Financial calendar & contact details Interim report 1st half 2015 6 August 2015 Interim report 1st to 3rd quarter 2015 5 November 2015 Contact details Christian Krupp Tel:+49 (0) 221 822 5400 Ottostrasse 1 Fax:+49 (0) 221 822 15 5400 51149 Cologne (Porz-Eil) Email: krupp.c@deutz.com Germany www.deut
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.