Deutz Ag · XETR:DEZ
Deutz — Q1 2019 Earnings Presentation
30 slides from Deutz's earnings presentation, May 7, 2019
Slide 1: DEUTZ Q1 2019 Results
DEUTZ Q1 2019 Results 7 May 2019
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements that are subject to various risks and uncertainties. Future results could differ materially from those described in these forward-looking statements due to certain factors, e.g. changes in business, economic and competitive conditions,
Slide 3: Agenda: Strategy & operational highlights
Agenda Strategy & operational highlights Dr Frank Hiller | CEO 3
Slide 4: Highlights
Highlights Successful start to the year ▪ Ongoing strong demand – order intake (€514.5 million) sequentially above Q4 2018 ▪ Revenue increased by +9.2% yoy – supported by growth in all regions and applications ▪ Operating profit grew significantly by 15.7% to €25.1 million ▪ EBIT margin improved by
Slide 5: Fast execution of E-DEUTZ strategy gaining momentum
gaining momentum ▪ Increasing number of customer projects ▪ Live presentation of different prototype machines at trade fair bauma in April ▪ KOBELCO mini excavator with all-electric drive paves way for emission-free operation – market launch in 2021 Fast execution of E-DEUTZ strategy 5
Slide 6: Sales figures
Sales figures New orders Unit sales Revenue € million Units € million -10.5% -1.5% +9.2% 574.9 514.5 48,458 47,735 452.8 414.5 Q1 2018 Q1 2019 Q1 2018 Q1 2019 Q1 2018 Q1 2019 ▪ New orders below Q1 2018, which had been positively influenced by exceptional items, but 27.4 % above Q4 2018 ▪ Book-to-bil
Slide 7: Revenue by region
Revenue by region1) Q1 2019 (Q1 2018) Africa/Middle East 3% Europe (excl. Germany) 40% €11.6 million €181.6 million +27.5% yoy +1.3% yoy Asia-Pacific 17% €452.8 million (€414.5 million) €78.7 million +18.3% yoy Americas 22% Germany 18% €101.2 million €79.7 million +23.4% yoy +2.7% yoy Growth in all
Slide 8: Revenue by application
Revenue by application1) Q1 2019 (Q1 2018) Other 6% Construction Equipment 30% €26.5 million €137.6 million +23.8% yoy +6.1% yoy Stationary Equipment 8% €452.8 million Material Handling 20% €35.2 million (€414.5 million) €90.4 million +1.4% yoy +8.7% yoy Agricultural Machinery 16% Service 20% €73.3
Slide 9: Agenda: Key financials in more detail
Agenda Key financials in more detail Dr Andreas Strecker | CFO 9
Slide 10: Operating profit & net income
Operating profit & net income Q1 2018 Q1 2019 € million € million 44.9 19.8 40.9 19.2 25.1 0.6 3.6 21.7 0.6 2.9 20.9 18.2 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 9.8% and EBIT improved by 15.7% ma
Slide 11: EBIT
EBIT EBIT & EBIT margin ▪ Further improvement of profitability in DEUTZ Compact € million Engines (DCE) segment despite reassignment of an engine series. Improvement of profitability attributable to higher business volume of new engine series and FX-effects 25.1 | 5.5% 21.7 | 5.2% ▪ Substantial EBIT
Slide 12: DEUTZ Compact Engines
DEUTZ Compact Engines € million Q1 2019 Q1 2018 ∆ yoy € million Q1 2019 Q4 2018 ∆ qoq in % in % New orders 409.3 492.9 -17.0 New orders 409.3 326.0 25.6 Unit sales (units) 38,970 44,563 -12.6 Unit sales (units) 38,970 54,225 -28.1 Revenue 356.2 352.0 1.2 Revenue 356.2 398.8 -10.7 EBIT 18.5 17.0 8.8
Slide 13: DEUTZ Customised Solutions
DEUTZ Customised Solutions € million Q1 2019 Q1 2018 ∆ yoy € million Q1 2019 Q4 2018 ∆ qoq in % in % New orders 96.9 76.7 26.3 New orders 96.9 70.7 37.1 Unit sales (units) 7,094 1,762 302.6 Unit sales (units) 7,094 2,766 156.5 Revenue 91.2 57.7 58.1 Revenue 91.2 79.4 14.9 EBIT 12.8 7.7 66.2 EBIT 12.
Slide 14: R&D spending & capital expenditure
R&D spending & capital expenditure R&D expenditure Capital expenditure (excl. R&D) € million € million 5.2% 4.5% 23.6 18.7 18.8 13.7 Q1 2018 Q1 2019 Q1 2018 Q1 2019 Net R&D expenditure ratio1) ▪ Increase of R&D spending and Capex due to execution of E-DEUTZ strategy and expansion of product range ▪
Slide 15: Working capital & cash flow from operating activities
Working capital & cash flow from operating activities Working capital Cash flow from operating activities € million € million 17.6% 16.9% 320.1 260.0 10.1 -2.8 31 Mar 2018 31 Mar 2019 Q1 2018 Q1 2019 Working capital ratio ▪ Working capital increase attributable to higher business volume and inventor
Slide 16: Free cash flow & net financial position
Free cash flow & net financial position Free cash flow1) Net financial position € million € million 88.9 14.5 21.3 -6.6 2018 Q1 2019 (LTM) 31 Mar 2018 31 Mar 2019 ▪ Lower net financial position due to implementation of IFRS 16 and higher investments 16 1) Free cash flow: cash flow from operating and
Slide 17: Equity ratio & funding
Equity ratio & funding Equity ratio Funding € million € million 1,322.4 1,249.3 49.6% 48.5% 619.1 640.9 160 20 13 31 Dec 2018 31 Mar 2019 up to 1 year 1 to 5 years Total assets Equity Equity ratio Repayment schedule Duration of credit line ▪ Healthy balance sheet – Equity ratio amounts to 48.5% ▪ Me
Slide 18: Agenda: Outlook
Agenda Outlook Dr Frank Hiller | CEO 18
Slide 19: Financial outlook 2019
Financial outlook 2019 € million FY 2018 FY 2019 guidance Revenue 1,778.8 > 1,800 EBIT margin (before exceptional items) 4.6% ≥ 5.0% R&D expenditure1) 85.0 85–90 Capex (excl. R&D)1) 59.1 85–952) ▪ Supportive market environment and ongoing strong demand ▪ Expected positive exceptional items in FY 201
Slide 20: Annex
Annex
Slide 21: 2019 forecast for key end-customer markets
2019 forecast for key end-customer markets Unit sales (equipment) Europe North China America Construction Equipment 0% to +5% 0% to +5% 0% to +5% Material Handling 0% to +5% 0% to +5% +5% to +10% Agricultural Machinery 0% to +5% 0% to +5% -5% to -10% Supportive market environment 21 Source: DEUTZ ma
Slide 22: Summary of key financials
Summary of key financials € million Q1 2019 Q1 2018 ∆ yoy in % EBITDA 44.9 40.9 9.8 EBITDA margin (%) 9.9 9.9 -- EBIT 25.1 21.7 15.7 EBIT margin (%) 5.5 5.2 +30 bps Equity ratio (%) 48.5 49.0 -50 bps Free cash flow1) -30.2 -9.1 231.9 Net financial position 21.3 88.9 -76.0 Working capital 320.1 260.0
Slide 23: Overview of segments
Overview of segments New orders Q1 2019 Q1 2018 ∆ yoy Revenue Q1 2019 Q1 2018 ∆ yoy € million in % € million in % DEUTZ Compact Engines 409.3 492.9 -17.0 DEUTZ Compact Engines 356.2 352.0 1.2 DEUTZ Customised Solutions 96.9 76.7 26.3 DEUTZ Customised Solutions 91.2 57.7 58.1 Other 9.2 5.3 73.6 Other
Slide 24: Income statement
Income statement € million Q1 2019 Q1 2018 ∆ yoy in % Revenue 452.8 414.5 9.2 Cost of sales -365.3 -335.5 8.9 Research & development costs -22.7 -22.9 -0.9 Selling expenses -25.9 -23.3 11.2 General & administrative expenses -12.7 -11.1 14.4 Other operating income & expenses (net) -1.5 -0.4 275.0 Equ
Slide 25: Balance sheet: assets
Balance sheet: assets € million 31 Mar 2019 31 Dec 2018 ∆ yoy in % Non-current assets (before deferred tax assets) 552.3 506.2 9.1 Deferred tax assets 78.2 75.9 3.0 Inventories 377.7 333.5 13.3 Trade receivables 174.4 157.3 10.9 Other receivables & assets 44.3 43.2 2.5 Cash & cash equivalents 95.1 1
Slide 26: Balance sheet: equity & liabilities
Balance sheet: equity & liabilities € million 31 Mar 2018 31 Dec 2018 ∆ yoy in % Equity 640.9 619.1 3.5 Provisions for pensions & other post-retirement benefits 154.7 152.8 1.2 Deferred tax liabilities 0.5 0.5 0.0 Other provisions 37.6 36.2 3.9 Financial liabilities 42.6 19.3 120.7 Other liabilities
Slide 27: Cash flow statement (condensed)
Cash flow statement (condensed) € million Q1 2019 Q1 2018 EBIT 25.1 21.7 Cash flow from operating activities (total) -2.8 10.1 Capital expenditure on intangible assets, property, plant and equipment and investments -26.9 -18.6 Proceeds from the sale of non-current assets 0.0 0.0 Cash flow from inves
Slide 28: Financial calendar & contact
Financial calendar & contact Financial calendar H1 2019 results 1 August 2019 Q1-Q3 2019 results 7 November 2019 FY 2019 results 12 March 2020 AGM 2020 14 May 2020 Contact Leslie Isabelle Iltgen SVP Communications & Investor Relations +49 (0) 221 822 3600 leslie.iltgen@deutz.com 28
Slide 29: Questions & answers
Questions & answers
Slide 30: Thank you for your attention!
Thank you for your attention!