Volvo AB Class A · OMXSTO:VOLV_A
Volvo AB Class A — AB Volvo — Q3 2002 Earnings Presentation
18 slides from Volvo AB Class A's earnings presentation, Oct 24, 2002
Slide 1: Third Quarter 2002 Conference Call
Volvo Group 0 Third Quarter 2002 Conference Call October 24, 2002 AB Volvo Tele_confQ3-2002, October 24, 2002
Slide 2: Highlights
Volvo Group Highlights 1 Third Quarter In Focus Going Forward l Business Environment Short Term - Low demand in N. America, - Delivery peak of pre-EPA’02 trucks l Finalize production transfer - Continued downward trend in Europe to New River Valley l Increased Truck earnings l Production changeover
Slide 3: Sales by Market Area
Volvo Group Sales by Market Area 2 Third Quarter 2002 Third Quarter First Nine Months SEK M Split 2002 2001 Change 2002 2001 Change Western Europe 49% 20,292 20,124 1% 67,059 67,445 -1% Eastern Europe 4% 1,791 1,328 35% 5,055 3,954 28% North America 32% 13,177 13,381 -2% 39,406 42,176 -7% South Amer
Slide 4: Sales by Business Area
Volvo Group Sales by Business Area 3 Third Quarter 2002 Third Quarter First Nine Months SEK M Split 2002 2001 Change 2002 2001 Change Trucks 69% 28,507 25,611 11% 87,619 83,988 4% Buses 7% 2,876 4,001 -28% 10,183 12,631 -19% Construction Equipm. 12% 5,061 5,388 -6% 15,725 16,143 -3% Volvo Penta 4% 1
Slide 5: Operating Income by Business Area
Volvo Group Operating Income by Business Area 4 Third Quarter 2002 Third Quarter First Nine Months SEK M 2002 2001 Change 2002 2001 Change Trucks 673 (340) n.a. 682 449 1) 52% Buses (84) (185) n.a. (127) (293) n.a. Construction Equipm. 120 266 -55% 453 755 -40% Volvo Penta 117 141 n.a. 488 530 n.a.
Slide 6: Cash Flow Development
Volvo Group Cash Flow Development 5 Third Quarter 2002 4 Operating cash flow* 3 2 1 b SEK 0 -1 (0.8) -2 -3 -4 00 00 00 00 01 01 01 01 02 02 02 20 20 20 20 20 20 20 20 20 20 20 1- 2- 3- 4- 1- 2- 3- 4- 1- 2- 3- Q Q Q Q Q Q Q Q Q Q Q * Cash-flow after net investments excluding: Investments in shares, a
Slide 7: Consolidated Results
Volvo Group Consolidated Results 6 Third Quarter 2002 Third Quarter First Nine Months SEK M 2002 2001 Change 2002 2001 Change Net Sales 41,524 41,134 1% 131,203 131,982 -1% Gross income 7,434 7,101 5% 23,348 22,826 2% R&D expenses (1,335) (1,279) (4,213) (4,030) Selling expenses (3,612) (3,444) (11,
Slide 8: Reconciliation of Profit and Loss statement
Volvo Group Reconciliation of Profit and Loss statement 7 Third Quarter 2002 Third Quarter Reported Adjustments Normalized SEK M 2002 2001 2002 2001 2002 2001 Change Sales 41,524 41,134 41,524 41,134 1% 1) 2) Operating income 817 (1,618) 302 1,878 1,119 260 330% Financial net (233) (262) (233) (262)
Slide 9: Trucks
Volvo Group Trucks 8 Third Quarter Third Quarter First Nine Months SEK M 2002 2001 Change 2002 Change Volume (units) 37,515 31,142 20% 114,618 1% Sales 28,507 25,611 11% 87,619 4% Operating income 673 (340) n.a. 682 52% 1) Operating margin % 2.4% -1.3% 3.7 0.8% 0.3 Highlights In Focus l Increased de
Slide 10: Total Market Heavy Trucks: W. Europe Registration Forecast
Volvo Group 9 Total Market Heavy Trucks W. Europe Registration Forecast Units Thousands 300 246 Forecast 250 237 236 215 200 208 (10)% 150 100 98 99 '00 '01 '02 '03 AB Volvo Tele_confQ3-2002, October 24, 2002
Slide 11: Total Market Heavy Trucks: North America Retail Sales Forecast
Volvo Group 10 Total Market Heavy Trucks North America Retail Sales Forecast Units Thousands 309 300 257 250 255 Forecast 200 170 172 150 1% 100 98 99 '00 '01 '02 '03 AB Volvo Tele_confQ3-2002, October 24, 2002
Slide 12: Business Environment
Volvo Group 11 Business Environment North America 30,000 25,000 Industry built 20,000 15,000 10,000 Net order intake 5,000 0 j f m a m j j a s o n d j f m a m j j a s 2001 2002 Source: ACT Publications AB Volvo Tele_confQ3-2002, October 24, 2002
Slide 13: Buses
Volvo Group Volvo Buses 12 Third Quarter Third Quarter First Nine Months SEK M 2002 2001 Change 2002 Change Volume (units) 1,894 2,318 -18% 6,307 -12% Sales 2,876 4,001 -28% 10,183 -19% Operating income (84) (185) n.a. (127) n.a. Operating margin % -2.9% -4.6% 1.7 -1.2% 1.1 Highlights In Focus l Sig
Slide 14: Construction Equipment
Volvo Group Volvo Construction Equipment 13 Third Quarter Third Quarter First Nine Months SEK M 2002 2001 Change 2002 Change Sales 5,061 5,388 -6% 15,725 -3% Operating income 120 266 -55% 453 -40% Operating margin % 2.4% 4.9% (2.5) 2.9% (1.8) Highlights In Focus l Mixed market development l Producti
Slide 15: Penta
Volvo Group Volvo Penta 14 Third Quarter Third Quarter First Nine Months SEK M 2002 2001 Change 2002 Change Sales 1,735 1,774 -2% 5,946 8% Operating income 117 141 na 1) 488 na 1) Operating margin % 6.7% 7.9% na 1) 8.2% na 1) Highlights In Focus l Gained market shares in declining markets l Key cust
Slide 16: Aero
Volvo Group Volvo Aero 15 Third Quarter Third Quarter First Nine Months SEK M 2002 2001 Change 2002 Change Sales 1,961 2,994 -35% 6,784 -22% Operating income (72) 118 n.a. 46 -92% Operating margin % -3.7% 3.9% (7.6) 0.7% (5.8) Highlights In Focus l Still no recovery in air traffic. Overcapacity lead
Slide 17: Financial Services
Volvo Group Volvo Financial Services 16 Third Quarter Third Quarter First Nine Months SEK M 2002 2001 Change 2002 Change Operating income 126 69 83% 361 47% ROE % 1) 3.8% (1.4) Assets, MSEK 68,702 72,614 -5.4% 68,702 -5.4% Equity ratio 10.9% 11.0% (0.1) 10.9% (0.1) Highlights In Focus l Continued gr
Slide 18: Summary
Volvo Group 17 Volvo Group Summary l Business Environment - Low demand in N. America, - Delivery peak of pre-EPA’02 trucks - Continued downward trend in Europe l Increased Truck earnings l Strengthened positions in Asia l Focus on - Production transfer to New River Valley - Manage US demand pattern