Knorr-bremse Ag · XETR:KBX
Knorr-bremse — Q3 2023 Earnings Presentation
36 slides from Knorr-bremse's earnings presentation, Oct 31, 2023
Slide 1: Financial Results Q3/23
FINANCIAL RESULTS Q3/23 MARC LLISTOSELLA I CEO FRANK WEBER I CFO DR. NICOLAS LANGE I HEAD OF RVS OCTOBER 31, 2023
Slide 2: Key take-aways for today
Key take-aways for today Demand: rail solid and truck robust High order book secures solid capacity utilization ahead Successful start of the BOOST program Cashflow: first successes with the Collect project CVS: price increases support profitability Fix or sale: comprehensive program started D
Slide 3: New Head of RVS and Member of the Executive Board – Dr. Nicolas Lange
New Head of RVS and Member of the Executive Board – Dr. Nicolas Lange 2023-present: Knorr-Bremse | Head of RVS Member of the Executive Board Worldwide responsibility for the RVS division 2000-2023: Knorr-Bremse 2017-2023 Member and Chairman (since 2019) of the European Management Board, RVS
Slide 4: Solid demand in rail and truck markets continues
Solid demand in rail and truck markets continues CURRENT SITUATION OUTLOOK EU/NA: solid growth EU: full recovery of ridership to pre-Covid-19 CN: good momentum of ridership supporting level expected High order books at OEMs continue EU: good demand should continue Pricing of new OE contr
Slide 5: Q3/23: Strong top and bottom line
Q3/23: Strong top and bottom line OPERATIVE REVENUES OF EBIT MARGIN ORDER INTAKE € 1.94bn 11.5% FREE CASHFLOW € 1.98bn (+8% yoy) (PY: 11.3%) € 230m (+5% yoy) (PY: € 38m) ORDER BOOK € 932m 14.4% € 7.19bn 168% CASH (+5% yoy) CONVERSION € 1,007m 10.6% RATE 5
Slide 6: Improved EBIT and NWC efficiency led to enhanced profitability on invested capital
Improved EBIT and NWC efficiency led to enhanced profitability on invested capital CapEx [€m] NWC1 [€m] ROCE (annualized) [%] % of sales Scope of days 4.8% 81.4 17.5% 4.3% 72.9 16.1% 85 83 1,568 1,582 Q3/22 Q3/23 30.09.22 30.09.23 30.09.22 30.09.23 1) Short term notes payables and liabilities are in
Slide 7: FCF strongly improved and CCR delivered
FCF strongly improved and CCR delivered Free Cashflow1 [€m] Cash Conversion Rate [%] 230 168% 65 38 25% Q3/22 Q3/23 -229 Q3/22 Q3/23 9M/22 9M/23 1) FCF before M&A 7
Slide 8: RVS: Record order book and Book-to-bill >1, nine quarters in a row
RVS: Record order book and Book-to-bill >1, nine quarters in a row Order intake [€m] Order book [€m] 1.03 Book-to-bill 1.09 OI stronger in all regions Strong Order book provides EU: OE higher yoy due +6.7% good visibility +16.1% to Regional/ Commuter, 5,168 Order book at record level, 22 Metro,
Slide 9: RVS: Sound revenue growth and margin only slightly lower
RVS: Sound revenue growth and margin only slightly lower Revenue [€m] Op. EBIT [€m]/ Margin1 Revenue higher yoy in 15.6% 14.4% Op. EBIT almost stable +9.1% Q3/23 yoy Revenue growth Price increases and 22 supported by volume & cost measures only 109 932 prices +1.0% partly compensated 14 higher i
Slide 10: CVS: Global truck demand still solid and on a good level
CVS: Global truck demand still solid and on a good level Order intake [€m] Order book [€m] 1.07 Book-to-bill 0.95 -0.5% -4.1% OI normalizes as expected 2,035 2,024 Order book remains on high 1,003 23 after record levels level 962 EU: OI up. Shifts of High demand in EU and NA, -6 -59 orders conti
Slide 11: CVS: Strong revenues fueled by pricing successes lead to very strong margin increases
CVS: Strong revenues fueled by pricing successes lead to very strong margin increases Revenue [€m] Op. EBIT [€m]/ Margin1 9.2% 10.6% +7.4% 26 102 Revenues drivers: solid Profitability improved as 1,007 TPR and price increases +23.3% promised -58 938 EU: TPR stable, better New price agreements 9
Slide 12: Guidance FY23 confirmed
Guidance FY23 confirmed Revenue [€m] Op. EBIT Margin Free Cashflow [€m] Assumptions 7,500-7,800 10.5-12.0% 350-550 Current exchange rates 7,150 11.1% Essentially stable geopolitical and macroeconomic conditions No new lockdowns due to Covid Inflationary cost increases 219 will be compensat
Slide 13: BOOST – Value creation
BOOST – Value creation CURRENT SITUATION 2026 TARGETS Margin improvement is key priority € 8-9bn Highly resilient business with growth potential in AM REVENUES Long-term above market growth fueled by mega trends > 14% OP. EBIT MARGIN Improvement of cash conversion rate Solid balance sheet 80-90% CAS
Slide 14: Q&A / Backup
Q&A / Backup
Slide 15: Financial calendar: Upcoming events and FY24 release dates
Financial calendar: Upcoming events and FY24 release dates DATE EVENT October 31, 2023 Q3/23 financial results November 7, 2023 Societe Generale European ESG Conference, Paris November 14, 2023 UBS European Conference, London November 29, 2023 Global Mobilitiy Conference, Paris November 30, 2023 Soc
Slide 16: Q3/23 – Group: Order intake and Order book
Q3/23 – Group: Order intake and Order book Order intake [€m] Order book1 [€m] 1.05 Book-to-bill 1.02 +4.6% 7,191 +5.4% 6,878 169 45 1,980 1,879 -114 +9.0% RVS 4,844 5,168 RVS 877 1,019 DSB € 22m (Q3/22) Cojali CVS 1,003 € 23m (Q4/22) 962 CVS 2,035 2,024 Q3/22 Organic M&A FX Q3/23 30.09.22 30.09.23 1
Slide 17: Q3/23 – Group: Revenue development
Q3/23 – Group: Revenue development Revenue [€m] Revenue [€m] By business By region +8.2% 47 1,939 211 1,939 -10.9% SA 1,792 37 1,792 42 -112 Asia/ 471 1.2% +11.8% Pacific 465 932 RVS 855 NA 461 -4.6% 483 DSB € 22m (Q3/22) Cojali € 26m (Q4/22) 1,007 970 CVS 938 EU 20.9% 802 Q3/22 Organic M&A FX Q3/23
Slide 18: Q3/23 – Group: Profitability and EPS
Q3/23 – Group: Profitability and EPS op. EBIT [€m]/Margin2 EPS1 [€] 11.3% 11.5% -12.1% 0.90 0.79 +10.1% 8 28 224 203 -16 +14.0% DSB € -2m (Q3/22) Cojali € 9m (Q4/22) Q3/22 Organic M&A FX Q3/23 Q3/22 Q3/23 1) After minorities 2) M&A: Before PPA 18
Slide 19: Q3/23 Group: Bridge – reported EBIT to operating EBIT
Q3/23 Group: Bridge – reported EBIT to operating EBIT op. EBIT [€m]/Margin1 11.5% 11.5% 223 224 1 14.4% 14.4% 134 134 RVS 10.5% 10.6% 106 107 CVS CVS: +€ 1m Q3/23 rep. One Japan Q3/23 op. 1) M&A: before PPA RVS CVS 19
Slide 20: Q3/23 – Group: op. EBIT growth vs. prior year
Q3/23 – Group: op. EBIT growth vs. prior year op. EBIT [€m]/Margin1 11.3% 11.5% +10.1% 8 28 224 Reported: 223 203 -16 (11.5%) Reported: 200 +14.0% (11.2%) DSB € -2m (Q3/22) Cojali € 9m (Q4/22) Q3/22 Organic M&A FX Q3/23 1) M&A: before PPA RVS CVS 20
Slide 21: Group 9M/23 – Order intake and order book
Group 9M/23 – Order intake and order book Order intake [€m] Order book1 [€m] 1.14 Book-to-bill 1.06 +4.6% 7,191 +5.1% 6,878 321 146 6,216 5,917 -168 +5.4% RVS 4,844 5,168 RVS 3,005 3,044 DSB € 64m (Q3/22) Cojali CVS 2,913 € 82m (Q4/22) 3,174 CVS 2,035 2,024 9M/22 Organic M&A FX 9M/23 30.09.22 30.09.
Slide 22: Group 9M/23 – Revenue
Group 9M/23 – Revenue Revenue [€m] Revenue [€m] By business By region +12.7% 145 5,856 677 5,856 SA -4.4% 109 5,198 5,198 -164 Asia/ 114 1,374 6.3% +13.0% Pacific 1,292 2,746 RVS 2,453 NA 1,483 12.2% 1,322 DSB € 64m (Q3/22) Cojali CVS € 81m (Q4/22) 3,112 EU 17.0% 2,891 2,747 2,471 9M/22 Organic M&A
Slide 23: Group 9M/23 – Profitability
Group 9M/23 – Profitability op. EBITDA [€m]/Margin1 op. EBIT [€m]/Margin1 15.2% 15.2% 10.9% 10.9% +12.1% +12.5% 79 37 888 792 23 639 -21 568 64 + 10.0% 493 -16 RVS 472 RVS 387 373 + 11.3% DSB € -2m (Q3/22) Cojali DSB € 39m (Q4/22) € -6m (Q3/22) CVS 421 CVS 300 345 237 Cojali € 29m (Q4/22) 9M/22 Orga
Slide 24: Group 9M/23: Bridge – reported EBIT to operating EBIT
Group 9M/23: Bridge – reported EBIT to operating EBIT op. EBIT [€m]/Margin1 10.6% 10.9% 622 4 2 14 1 639 -4 14.0% 14.1% 385 387 RVS: -€ 12m RVS: +€ 14m 9.2% 9.6% 285 300 CVS: +€ 8m CVS: +€ 4m CVS: +€ 2m CVS: +€ 1m 9M/23 rep. Exit Russia Sale Restructuring Technical One Japan 9M/23 op. Foundry Sheppa
Slide 25: Group 9M/23: op. EBIT growth vs. prior year
Group 9M/23: op. EBIT growth vs. prior year op. EBIT [€m]/Margin1 10.9% 10.9% +12.5% 64 23 639 568 -16 Reported: Reported: 543 +11.3% 622 (10.4%) (10.6%) DSB 387 373 € -6m (Q3/22) Cojali € 29m (Q4/22) 300 237 9M/22 Organic M&A FX 9M/23 1) M&A: before PPA RVS CVS 25
Slide 26: Group 9M/23 – FCF, CapEx, NWC and ROCE
Group 9M/23 – FCF, CapEx, NWC and ROCE OCF & FCF [€m] CapEx [€m] NWC1 [€m] ROCE (annualized) [%] % of sales Scope of days 4.4% 81.4 17.5% 3.8% 72.9 16.1% 275 65 226 222 1,568 1,582 -31 -229 9M/22 9M/23 9M/22 9M/23 30.09.22 30.09.23 30.09.22 30.09.23 OCF FCF 1) Short term notes payables and liabiliti
Slide 27: RVS 9M/23 – Order intake and order book
RVS 9M/23 – Order intake and order book Order intake [€m] Order book1 [€m] 1.23 Book-to-bill 1.11 +6.7% 5,168 +1.3% 4,844 68 64 3,044 3,005 +5.4% -94 DSB € 64m (Q3/22) 9M/22 Organic M&A FX 9M/23 30.09.22 30.09.23 27
Slide 28: RVS 9M/23 – Revenue and profitability
RVS 9M/23 – Revenue and profitability Revenue [€m] op. EBITDA [€m]/Margin1 op. EBIT [€m]/Margin1 +11.9% 19.2% 18.0% 15.2% 14.1% 318 64 2,746 -89 +4.6% 2,453 38 493 +3.8% 472 -2 -14 32 387 +13.0% 373 +8.0% -6 -12 + 8.7% DSB € 64m (Q3/22) DSB DSB € -2m (Q3/22) € -6m (Q3/22) 9M/22 Organic M&A FX 9M/23
Slide 29: CVS 9M/23 – Order intake and order book
CVS 9M/23 – Order intake and order book Order intake [€m] Order book1 [€m] 1.06 Book-to-bill 1.02 -0.5% 2,035 2,024 +8.9% 252 82 3,174 2,913 -74 +8.7% Cojali € 82m (Q4/22) 9M/22 Organic M&A FX 9M/23 30.09.22 30.09.23 29
Slide 30: CVS 9M/23 – Revenue and profitability
CVS 9M/23 – Revenue and profitability Revenue [€m] op. EBITDA [€m]/Margin1 op. EBIT [€m]/Margin1 +13.3% 13.5% 9.6% 12.5% 8.6% 359 81 3,112 2,747 -75 +22.3% 39 421 +26.4% +13.1% 44 345 -7 29 300 Cojali 38 € 81m (Q4/22) 237 -4 +12.8% +15.9% Cojali € 39m (Q4/22) Cojali € 29m (Q4/22) 9M/22 Organic M&A F
Slide 31: Group: Income statement
Group: Income statement 2022 2023 2022 2023 in €m Q3/22 Q4/22 FY22 Q1/23 Q2/23 Q3/23 9M/22 9M/23 Revenues 1.792,0 1.951,7 7.149,7 1.907,6 2.009,9 1.938,8 5.198,0 5.856,2 Change in inventory of unfinished/finished products 43,6 -76,0 30,0 5,4 12,0 9,1 105,9 26,5 Own work capitalized 28,1 28,1 105,0 2
Slide 32: Group: Cashflow statement
Group: Cashflow statement 2022 2023 2022 2023 EUR million Q3/22 Q4/22 FY22 Q1/23 Q2/23 Q3/23 9M/22 9M/23 Net cash flows from/used in operating activities 121,6 572,9 541,6 -137,0 105,3 306,8 -31,3 275,1 Net cash flows from/used in investing activities -69,5 -274,3 -505,0 -110,7 -69,1 -88,3 -230,7 -2
Slide 33: Group: Balance sheet/ assets
Group: Balance sheet/ assets 2022 2023 in €m 30.09.2022 31.12.2022 31.03.2023 30.06.2023 30.09.2023 Assets Intangible assets and goodwill 1.068,5 1.340,2 1.337,7 1.331,9 1.343,8 Property, plant and equipment 1.850,5 1.814,5 1.820,0 1.798,0 1.804,3 Investments accounted for using the equity method 84
Slide 34: Group: Balance sheet/ liabilities
Group: Balance sheet/ liabilities 2022 2023 in €m 30.09.2022 31.12.2022 31.03.2023 30.06.2023 30.09.2023 Equity Subscribed capital 161,2 161,2 161,2 161,2 161,2 Capital reserves 13,9 13,9 13,9 13,9 13,9 Retained earnings 10,3 10,3 10,3 10,3 4,8 Other components of equity -49,7 -123,9 -138,1 -167,8 -
Slide 35: Investor relations contact
Investor relations contact Andreas Sophia Stephanie Spitzauer Kursawe Jaschiniok +49 89 3547 182310 +49 89 3547 187311 +49 89 3547 183466 +49 175 5281320 +49 151 62330709 +49 171 8451732 Andreas.Spitzauer@knorr-bremse.com Sophia.Kursawe@knorr-bremse.com Stephanie.Jaschiniok@knorr-bremse.com 35
Slide 36: 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