Slide 1: Second Quarter 2020 Earnings Conference
Second Quarter 2020 Earnings Conference 16 July, 2020
Slide 2: Today's presenters
Today’s presenters JOHAN OSKAR MENCKEL HELLSTRÖM CEO CFO Since: 2012 Since: 2011 Gränges since: 2004 2
Slide 3: Second quarter 2020: Strong cash generation and difficult market conditions
Second quarter 2020 Strong cash generation and difficult market conditions ○ Very difficult market conditions in all regions due to the COVID-19 pandemic ○ Continued focus on mitigating actions ○ Reduced sales volume and operating profit – Sales volume declined by 24% – Adjusted operating profit SEK
Slide 4: Light vehicle production decreased by 47% while HVAC production decreased by 19%
Light vehicle production decreased by 47% while HVAC production decreased by 19% in the second quarter End market production growth (YoY) End market Automotive HVAC Region Global Asia Europe Americas Americas Q2 2020 -47% -25% -65% -73% -19% Q3 2020 -12% -15% -10% -6% - Full year 2020 -23% -20% -26%
Slide 5: Significant reduction of end-market demand partly offset by customer inventory build-up and higher market share
Significant reduction of end-market demand partly offset by customer inventory build-up and higher market share Gränges sales volume (ktonnes) Asia Europe Americas Gränges Group -28% -47% -16% -24% 55.8 92.8 21.0 16.1 47.1 70.8 15.1 46.6 8.6 46.6 43.4 43.4 46.2 9.2 27.3 3.7 2019 2020 2019 2020 2019
Slide 6: Continued focus on measures to mitigate the impact of the COVID-19 pandemic
Continued focus on measures to mitigate the impact of of the COVID-19 pandemic ○ Ensure health and safety of employees Continuity ○ Secure ability to operate production facilities ○ Secure supply of critical material ○ Control working capital Cash ○ Reduce capex ○ Ensure good liquidity and committed
Slide 7: Status of current operations and expansion initiatives
Status of current operations and expansion initiatives Finspång Konin Huntingdon Salisbury Shanghai Newport Americas Europe Asia ○ Huntingdon and Newport ○ Finspång reduced to 40+ ○ Shanghai operating as operating as normal per cent capacity normal ○ Salisbury temporary closed ○ Finspång site logist
Slide 8: Significant reduction in sales volume negatively impacted the operating profit in the second quarter
Significant reduction in sales volume negatively impacted the operating profit in the second quarter Sales volume and adjusted operating profit Adjusted operating profit per tonne 500 1,250 4 Adjusted operating profit per tonne (kSEK) 1005 Adjusted operating profit (SEK million) 400 933 1,000 3 Sale
Slide 9: Financial overview – second quarter 2020
Financial overview – second quarter 2020 SEK million Q2 Rolling 12 months 2020 2019 Change Jun 2020 Dec 2019 Change Sales volume (ktonnes) 70.8 92.9 -23.8% 324.3 347.3 -6.6% Net sales 2,221 3,188 -30.3% 10,964 11,978 -8.5% Adjusted operating profit1 42 257 -83.7% 586 866 -32.3% Adjusted operating ma
Slide 10: The net debt was reduced to SEK 3.2 billion on 30 June
The net debt was reduced to SEK 3.2 billion on 30 June Change in net debt -2,000 2.8 Adjusted cash flow before financing 2.9 SEK 238 million -2,500 SEK million -3,000 -7 -3,247 108 -45 -40 114 -3,500 -3,559 182 -4,000 Net debt Adjusted Change in Other Maintenance Expansion FX & Net debt 31 Mar EBITD
Slide 11: Outlook - third quarter 2020
Outlook - third quarter 2020 ○ The uncertainty around the COVID-19 pandemic makes reliable forecasting very difficult ○ IHS estimates a gradual recovery of the global light vehicle production in the third quarter ○ Currently a lower year over year decline and fairly similar sales volume is expected
Slide 12: Summary - second quarter 2020
Summary - second quarter 2020 ○ Very difficult market conditions in all regions due to the COVID-19 pandemic ○ Continued focus on mitigating actions ○ Reduced sales volume and operating profit ○ Continued strong cash generation 12
Slide 13: Q&A
Q&A Johan Menckel, CEO Oskar Hellström, CFO
Slide 14: Slide 14