Knorr-bremse Ag · XETR:KBX
Knorr-bremse — Q1 2021 Earnings Presentation
28 slides from Knorr-bremse's earnings presentation, May 14, 2021
Slide 1: Financial Results Q1/21
Quarterly Statement January 1 to March 31, 2021 FINANCIAL RESULTS Q1/21 DR. JAN MICHAEL MROSIK I CEO FRANK MARKUS WEBER I CFO MAY 14, 2021
Slide 2: Highlights in Q1/21
Highlights in Q1/21 Continuing solid financials as expected → Revenues up 6%yoy organically and EBIT margin at 14.9% (+110bps) in Q1/21 Strong performance on top and bottom line in CVS → Revenues +22%yoy organically and EBIT margin significantly improved (13.1%) RVS fully in line with expectations →
Slide 3: Shareholding of KB's anchor investor stable and secured
Shareholding of KB’s anchor investor stable and secured Continuity and Stability Anchor investor Thiele family Supervisory and Executive Board of KB ▪ Strong commitment of Thiele family in KB shareholding ▪ Prof. Dr. Mangold prolongs his mandate as Chairman of the Supervisory Board by two years ▪ Ju
Slide 4: Further recovery of markets strongly depends on COVID-19 and supply status
Further recovery of markets strongly depends on COVID-19 and supply status Current market situation Market expectations towards YE21 Continuously no cancellations General market fundamentals intact (e.g. decarbonization efforts) and increasing government subsidies for rail No major supply issues in
Slide 5: Expected development of RVS in FY21
Expected development of RVS in FY21 Q1/21 Q2-Q4/21e • Q1/21 strongly impacted by: 1) seasonality of tenders in • Underlying demand in rail mirrored by strong OI of FY21, 2) strong development in Q4/20 3) low rail traffic RVS’s customer base will be supportive leading to tense financial situation for
Slide 6: Expected development of CVS in FY21
Expected development of CVS in FY21 Q1/21 Q2-Q4/21e • EU/NA: • Development will highly depend on supply shortage and COVID-19 - Strong demand – no supply issue so far • EU/NA: - Transportation industry expands capacity REGIONS - Ongoing recovery demand expected towards YE21 • CN: Record TPR and stro
Slide 7: Operating highlights: strong execution of RVS and CVS
Operating highlights: strong execution of RVS and CVS eCUBATOR started to Expansion of truck 10y contract for braking Major order of 254 Metro bundle expertise in electric capacities within China to and air treatment systems rail cars for Atlanta mobility meet high demand (€ 1bn) signed with big met
Slide 8: Financial highlights Q1/21: superb KPIs improved in all dimensions
Financial highlights Q1/21: superb KPIs improved in all dimensions based on signs of recovery REVENUES OF € 1.69bn 14.9% EBIT MARGIN (ROS) (+3.9% yoy) (PY: 13.8%) € 805m € 886m 18.0% 13.1% € -23m FREE CASHFLOW (PY: € -61m) -13% Cash Conversion Rate ORDER INTAKE € 1.80bn ORDER BOOK € 5.08bn (+13.3% y
Slide 9: Order intake rises third quarter in a row leading to record-high order book
Order intake rises third quarter in a row leading to once again record-high order book Order intake Order book €m €m 0.98 Book-to-bill 1.06 +9.3% +13.3% 5,084 4,652 248 27 1,799 1,588 -65 15.6% R.H. Sheppard € +27m (Q1/21) Q1/20 Organic M&A FX Q1/21 31.03.20 31.03.21 Book-to-bill 9
Slide 10: Revenue increase mirrors ongoing recovery and strong order book
Revenue increase mirrors ongoing recovery and strong order book provides high visibility for revenue development in FY21 Revenue €€m m By type By region +3.9% 96 28 1.6% 1,692 SA 1,627 1,692 1,627 25 -61 24 9.2% Asia/ 477 521 Pacific RVS 5.9% RVS 892 805 -1.7% NA 353 347 CVS R.H. Sheppard CVS € +28m
Slide 11: Strong profitability increase by 110bps shows good conversion of revenues into profit
Strong profitability increase by 110bps shows good conversion of revenues into profit EBIT/ ROS EBITDA/ E. Margin €m EBIT margin (ROS) increased by 110bps in Q1/21yoy 18.9% 17.8% ▪ Operating leverage and benefits from cost measures supported margin increase 14.9% 13.8% ▪ Revenue share of AM decrease
Slide 12: Focused spending and stringent NWC management in place to ensure ROCE
Focused spending and stringent NWC management in place to ensure ROCE CapEx1 NWC ROCE (annualized) €m % of sales €m Scope of days % 58,5 57,2 28.2% 5.0% 26.7% 1.076 3.7% 1.059 81 62 Q1/20 Q1/21 31.03.20 31.03.21 31.03.20 31.03.21 ▪ Effects of mgt. program for adaption ▪ Higher stock levels to secure
Slide 13: FCF significantly improved despite headwinds from FY20 year-end effects
FCF significantly improved, despite headwinds from strong FY20 year-end effects and usual weak seasonality in Q1 Free Cashflow1 Cash Conversion Rate €m ▪ Free Cashflow increased by ~€ 38m yoy ▪ Improvement of CCR by ~30%p ▪ Business development and stringent measures taken to secure strong improveme
Slide 14: RVS: OI facing lumpiness of tenders and award timing in 2021
RVS: OI facing lumpiness of tenders and award timing in 2021, while strong order book secures high visibility until YE21 Order intake Order book €m Order book increased by 2.1 %yoy +2.1% 0.98 Book-to-bill 0.89 ▪ Order book well supported by resilient and stable rail 3.555 3.630 industry despite COVI
Slide 15: RVS: improved profitability despite revenue decrease, strong resilience
RVS: improved profitability despite revenue decrease, strong resilience Revenue EBIT / EBITDA €m 17.5% 18.0% Revenue development as expected in Q1/21 ▪ AM: Lower rail traffic/ maintenance burdened -7.3% the development in Q1/21 yoy 157 ▪ EU: OE lower yoy mainly impacted by Kiepe; 0 145 -9.7% RS over
Slide 16: CVS: extremely strong OI and order book reflect high demand
CVS: extremely strong OI and order book reflect high demand in market Order intake Order book €m +31.9% Significant organic order growth in comparison to beginning of COVID-19 crisis at end of Q1/20 0.97 Book-to-bill 1.22 1.468 ▪ EU/ NA: Market recovery qoq continued in Q1/21 and lead to solid growt
Slide 17: CVS: all-time high quarterly revenues with significantly improved profitability
CVS: all-time high quarterly revenues with significantly improved profitability Revenue EBIT / EBITDA €m 13.1% Increased market demand combined with latest 10.4% acquisitions lead to record sales ▪ EU & NA: Improvement in all channels, supply +51.0% crisis well managed so far, but expected in +20.5%
Slide 18: Continuous improvements in ESG are KB's priority
Continuous improvements in ESG are KB’s priority ESG goals within mgt bonus system (2022) Recent developments in ESG at KB INTERNAL • Further driving decarbonization via climate strategy1 Environment • Lower vehicle emissions – eCubator founded as think tank ➢ KB contribution to for future product e
Slide 19: Group Guidance 2021 confirmed
Group Guidance 2021 confirmed Revenue EBITDA margin EBIT margin (ROS) Assumptions €m ▪ Stable economic environment in 6,500-6,900 important markets 6.157 17.5-19.0% 18,0% ▪ FX rates based on March 20211 13.0-14.5% 13,2% ▪ No further setbacks occur as a result of COVID-19 ▪ We assume it will be possi
Slide 20: Key Take Aways
Key Take Aways Very solid Q1/21 KPIs overall in turbulent times Impact of COVID-19 and supply shortages will continue Corporate Governance and ESG overall further strengthened Fully on track to fulfill guidance FY21 20
Slide 21: Q&A / Backup
Q&A / Backup 21
Slide 22: Financial calendar: upcoming events
Financial calendar: upcoming events Date Event May 18, 2021 Berenberg U.S. Conference May 20, 2021 Annual General Meeting May 26, 2021 Post Q1/21 Roadshow May 27, 2021 UBS U.S. Conference, Best of Europe June 8-9, 2021 UBS Global Industrials and Transportation Conference June 10, 2021 JPM CEO Confer
Slide 23: Q1/21: income statement
Q1/21: income statement INCOME STATEMENT 2020 2021 EUR million Q1/20 Q2/20 Q3/20 Q4/20 FY/20 Q1/21 Revenues 1,627.5 1,428.3 1,533.5 1,567.4 6,156.7 1,691.5 Change in inventory of unfinished/finished products -0.8 15.1 -6.7 -18.9 -11.3 30.0 Own work capitalized 18.8 18.5 19.6 19.2 76.1 19.2 Total ope
Slide 24: Q1/21: cashflow
Q1/21: cashflow CASHFLOW STATEMENT (shortened) 2020 2021 EUR million Q1/20 Q2/20 Q3/20 Q4/20 FY/20 Q1/21 Net cash flows from/used in operating activities 3.5 115.1 250.8 666.6 1,036.0 27.6 Net cash flows from/used in investing activities -57.8 -195.5 -69.2 -253.9 -576.4 -78.8 Net cash flows from/use
Slide 25: Q1/21: balance sheet / assets
Q1/21: balance sheet / assets BALANCE SHEET 2019 2020 2021 EUR thousand 31.03.2019 30.06.2019 30.09.2019 31.12.2019 31.03.2020 30.06.2020 30.09.2020 31.12.2020 31.03.2021 Assets Intangible assets and goodwill 840.0 813.9 838.4 842.2 858.8 896.2 888.5 887.8 899.2 Property, plant and equipment 1,430.5
Slide 26: Q1/21: balance sheet / liabilities
Q1/21: balance sheet / liabilities BALANCE SHEET 2019 2020 2021 EUR thousand 31.03.2019 30.06.2019 30.09.2019 31.12.2019 31.03.2020 30.06.2020 30.09.2020 31.12.2020 31.03.2021 Equity Subscribed capital 161.2 161.2 161.2 161.2 161.2 161.2 161.2 161.2 161.2 Capital reserves 13.9 13.9 13.9 13.9 13.9 13
Slide 27: Investor relations contact
Investor relations contact Andreas Sophia Spitzauer Kursawe +49 89 3547 182310 +49 89 3547 187311 +49 175 5281320 +49 151 62330709 Andreas.Spitzauer@knorr-bremse.com Sophia.Kursawe@knorr-bremse.com 27
Slide 28: Disclaimer
Disclaimer IMPORTANT NOTICE This presentation has been prepared for information and background purposes only. It does not constitute or form part of, and should not be construed as, an offer of, a solicitation of an offer to buy, or an invitation to subscribe for, underwrite or otherwise acquire, an