Slide 1: Interim Report First Quarter 2023
INTERIM REPORT FIRST QUARTER 2023
Slide 2: Summary Q1
SUMMARY Q1 18% Revenue growth at CONTINUED ROBUST PERFORMANCE WITH 18% REVENUE GROWTH fixed exchange rates • Good momentum and solid execution with strong revenue growth and record order intake level • Total order intake growth was 13%, and at fixed exchange rates 6%, of which organic 2% • Total rev
Slide 3: Staying Ahead Through Innovation
STAYING AHEAD THROUGH INNOVATION Y-AXIS TURNING • Possibility to machine several features with one tool • Significantly reduced tool change time • The cutting forces are directed into the tool holder, which provides high process stability • A constant, fixed entering angle drastically improves chip
Slide 4: YoY Market Development
YOY MARKET DEVELOPMENT Mining Engineering Automotive Energy Infrastructure Aerospace Percent of 48% 22% 7% 2% 11% 3% revenue 2022 Percent of Q1 Y/Y* revenue 2022 order intake EUROPE 27% +21% NORTH AMERICA 25% +2% ASIA 19% -6% AFRICA AND MIDDLE EAST 12% +11% AUSTRALIA 12% -16% SOUTH AMERICA 7% +24% (
Slide 5: Order Intake and Revenues
ORDER INTAKE AND REVENUES MSEK 35,000 130,000 ORDER INTAKE 120,000 30,000 REPORTED (SEK M) 110,000 25,000 100,000 90,000 34,363 20,000 80,000 15,000 70,000 60,000 10,000 REVENUES 5,000 REPORTED (SEK M) 10,000 0 Q1 Q2 2019* Q3 Q4 Q1 Q2 2020* Q3 Q4 Q1 Q2 2021* Q3 Q4 Q1 Q2 2022* Q3 Q4 Q1 2023 0 30,968
Slide 6: Growth in Order Intake and Revenues
GROWTH IN ORDER INTAKE AND REVENUES ORDER INTAKE REVENUES MSEK MSEK 50% 130,000 50% 120,000 40% 120,000 40% 110,000 30% 110,000 30% 100,000 20% 100,000 20% 90,000 90,000 10% 10% 80,000 80,000 0% 0% -10% -10% -20% -20% -30% -30% -40% -40% Q1 Q2 Q3 Q4* Q1 Q2 Q3 Q4* Q1 Q2 Q3 Q4* Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3
Slide 7: Adjusted EBITA Development
Adj. EBITA margin: ADJUSTED EBITA DEVELOPMENT 19.8% MSEK 7,000 +21% 24% • Adj. EBITA SEK 6,119 M (5,043) 6,000 • Margin 19.8% (20.2) 20% 5,000 16% • Negative currency effect of 100 basis 4,000 points from revaluation on unhedged 12% balance sheet items 3,000 8% • Leverage: 2,000 • Price mitigated co
Slide 8: Mining and Rock Solutions
51%SHARE OF REVENUES 2022 MINING AND ROCK ORDER INTAKE AND REVENUES MSEK SOLUTIONS 20,000 150% ORDER INTAKE 16,000 100% • All-time high order intake level achieved. Particularly strong growth in 12,000 Load and Haul, Parts and Services and Digital Mining Technologies 8,000 50% • Total order intake g
Slide 9: Rock Processing Solutions
8% SHARE OF REVENUES 2022 ROCK PROCESSING ORDER INTAKE AND REVENUES MSEK SOLUTIONS 4,000 150% 3,000 ORDER INTAKE 100% • 25% growth contribution from acquisitions and positive aftermarket 2,000 development 50% 1,000 • Total order intake grew by 22% and at fixed exchange rates 15% of which organic gro
Slide 10: Manufacturing and Machining Solutions
41% SHARE OF REVENUES 2022 MANUFACTURING AND ORDER INTAKE AND REVENUES MSEK MACHINING SOLUTIONS 16,000 150% 12,000 ORDER INTAKE 100% • Positive development in all customer segments driven by solid 8,000 demand in Europe. Double-digit growth in aerospace and energy 50% 4,000 • Total order intake grow
Slide 11: Cecilia Felton, CFO
CECILIA FELTON CFO 11
Slide 12: Financial Summary
FINANCIAL SUMMARY MSEK Q1 2022* Q1 2023 GROWTH OI REV. ORGANIC 2% 13% ORDER INTAKE 30,474 34,363 STRUCTURE 4% 4% REVENUES 24,921 30,968 ORG + STR 6% 18% ADJUSTED EBITA 5,043 6,119 CURRENCY 7% 6% ADJUSTED EBITA MARGIN 20.2% 19.8% TOTAL 13% 24% NET FINANCIAL ITEMS -299 -529 TAX RATE EXCLUDING IAC 23.2
Slide 13: Bridge Analysis
GROUP LEVERAGE: BRIDGE ANALYSIS Q1 Q1 MSEK 2022 ORGANIC CURRENCY* STRUCTURE 2023 REVENUES 24,921 3,184 1,832 1,031 30,968 ADJUSTED EBITA 5,043 234 660 182 6,119 ADJUSTED EBITA MARGIN 20.2% 7% 19.8% ACCRETION/DILUTION -1.5% 1.1% -0.1% * Currency effect net of structure component 13 SANDVIK: Interim r
Slide 14: Net Financials
NET FINANCIALS SEK Q1 2022 Q1 2023 Interest net increase due to increased borrowed INTEREST NET -74 -361 volumes and higher interest rates PENSION -42 -23 BANK CHARGES -20 -20 OTHER FINANCIAL INCOME AND COST -14 -3 LEASES IFRS16 -35 -49 FX AND OTHER ASSET CLASSES -113 -74 TOTAL -299 -529 * Best esti
Slide 15: Tax Rate
TAX RATE Q1 2022 Q1 2023 • Tax rate excl. IAC – adjusted for M&A costs REPORTED 23.4% 24.6% EXCLUDING IAC 23.2% 24.5% • Normalized tax rate – excl. transfer price adjustment related to a prior year NORMALIZED 23.2% 23.6% For continuing operations IN LINE WITH 23-25% GUIDANCE FOR 2023 * Best estimate
Slide 16: Net Working Capital
NET WORKING CAPITAL NET WORKING CAPITAL PER BA, % OF REVENUES MSEK 40,000 40% 40% 35,000 35% 35% 30,000 30% 30% 25,000 20,000 25% 25% 15,000 20% 20% 10,000 15% 5,000 0 0% 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2019 2020 2021 2022 2023
Slide 17: Free Operating Cash Flow
FREE OPERATING CASH FLOW MSEK 7,000 140% 6,000 120% MSEK Q1 2022 Q1 2023 EBITDA * 5,847 6,890 5,000 100% NON-CASH ITEMS -269 15 4,000 80% NWC CHANGE -3,034 -2,079 3,000 60% CAPEX ** -251 -1,116 2,000 40% FOCF *** 2,292 3,710 1,000 20% 0 0% * Adjusted for cash items related to certain acquisition cos
Slide 18: Net Debt
NET DEBT GROUP TOTAL MSEK RATIO 1.5 50,000 • Financial net debt / R12 EBITDA 1.30 40,000 1.2 0.9 30,000 • Financial net debt SEK 36.2 billion 0.6 20,000 0.3 10,000 • Net debt SEK 43.4 billion 0.0 0 -0.3 -10,000 -0.6 -20,000 -0.9 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2019 2020 2021 2022
Slide 19: Outcome Versus Guidance
OUTCOME VERSUS GUIDANCE Outcome Guidance Quarterly Underlying currency yoy effect (MSEK) 660 600 Capex (BSEK) 1.2 4.5 Annually Interest net (BSEK) -0.4 -1.7 Normalized tax rate (%) 23.6% 23-25% 19 SANDVIK: Interim report on the first quarter 2023 Comments and numbers refer to continuing operations u
Slide 20: Guidance Q2 and FY 2023
GUIDANCE Q2 AND FY 2023 CAPEX (CASH) Estimated to approx. SEK 4.5 B for 2023. CURRENCY Given currency rates at end of March 2023 the effect on operating profit from transaction and EFFECTS translation would be SEK +200 M for Q2 2023 INTEREST NET Underlying interest net is estimated to approximately
Slide 21: Conclusion
CONCLUSION EIGHT CONSECUTIVE QUARTERS WITH DOUBLE-DIGIT REVENUE GROWTH • Continued momentum, favorable demand and solid price execution • Strong contribution from acquisitions • Strong backlogs in the long-cycle business and robust development in the short-cycle business EXECUTING ON OUR SHIFT TO GR
Slide 22: Q&A
O&A (a) > Z Ss a
Slide 23: Back-up Slides
BACK-UP SLIDES SANDVIK P|
Slide 24: Bridge Analysis by Business Area
Q1 Q1 MSEK 2022 ORGANIC CURRENCY STRUCTURE 2023 MINING AND ROCK SOLUTIONS REVENUES 12,029 2,238 895 205 15,366 ADJUSTED EBITA 2,413 296 320 45 3,075 ADJUSTED EBITA MARGIN 20.1% 20.0% ROCK PROCESSING SOLUTIONS REVENUES 2,016 334 144 446 2,939 ADJUSTED EBITA 320 -14 69 51 426 ADJUSTED EBITA MARGIN 15.
Slide 25: Loan and Duration Profile
LOAN AND DURATION PROFILE AMOUNT DURATION LONG TERM Bonds MTN 30,176 4.6 years 84% Bank Loans 8,033 2.9 years SHORT TERM Commercial Paper 5,383 0.1 years 16% Bonds MTN Bank Loans 1,791 66 0.6 years 0.5 years TOTAL 45,449 3.6 years Committed Credit facilities SEK 16,750 M 25 SANDVIK: Interim report o
Slide 26: Loan Maturity Profile
LOAN MATURITY PROFILE AVERAGE MSEK INTEREST RATE: ~3.3% 12,000 10,000 8,000 6,000 4,000 2,000 - 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 26 SANDVIK: Interim report on the first quarter 2023 Comments and numbers refer to continuing operations unless otherwise stated.
Slide 27: Disclaimer Statement
DISCLAIMER STATEMENT “Some statements herein are forward-looking and the actual outcome could be materially different. In addition to the factors explicitly commented upon, the actual outcome could be materially affected by other factors for example, the effect of economic conditions, exchange-rate