Rieter Holding Ag · SIX:RIEN
Rieter — H1 2010 Earnings Presentation
34 slides from Rieter's earnings presentation, August 2010
Slide 1: 2010 Half Year Results
2010 Half Year Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Erwin Stoller, Executive Chairman . Leinhäuser, Urs . . .Chief.Financial . .Officer . . . . . . . . . . . . . . . . . .
Slide 2: Agenda
Agenda • Introduction and Summary of HY1 2010 Erwin Stoller • Financial Results HY1 2010 Urs Leinhäuser • Outlook Erwin Stoller Half year results August 2010 2
Slide 3: HY1: Back to positive operating result
HY1: Back to positive operating result “Rieter was able to successfully exploit the improved market environment in the first half of 2010 to generate organic growth and to achieve a positive operating result. With this, Rieter has reached an important milestone earlier than anticipated.” Erwin Stoll
Slide 4: Highlights HY1 2010
Highlights HY1 2010 • Striking market recovery: Strong growth of orders received and sales • Rieter successfully exploited the improved market environment in both divisions • Order intake increased by 92%, in Textile Systems even by 290% • Sales of Textile Systems increased by 30%, of Automotive Sys
Slide 5: Financial Results HY1 2010
Financial Results HY1 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Leinhäuser, Urs . . Chief . .Financial . Officer . . . . . . . . . . . . . . . . . .
Slide 6: HY1: Orders by division
HY1: Orders by division 775.3 CHF million 2000 92% • Orders received rose by 92% to 1‘615.3 million CHF 1615.3 1500 • Orders particularly boomed at Textile Systems 876.7 1‘095.1 • Order intake accelerated 1000 in HY1 2010 compared to 840.0 774.0 HY2 2009 500 650.3 • Market recovery became 738.6 more
Slide 7: HY1: Sales by division
HY1: Sales by division 301.5 CHF million 1600 34% • Sales rose by 34%, in local currencies by 35% 1‘201.3 • Increase attributable to an 1200 1‘056.5 improved business situation 899.8 in both divisions 800 876.7 • Both divisions were able to 774.0 take full advantage of the 650.3 recovery of their ma
Slide 8: HY1: Sales development by region
HY1: Sales development by region CHF million 600 19% • Sales growth in all 548 regions thanks to strong 500 461 global presence 62% 57% • Strongest growth in Asia 400 and North America 300 264 288 9% 200 183 163 93 101 100 0 HY1 2009 Europe + Asia North Latin HY2 2010 Africa America America Half yea
Slide 9: HY1: Operating result (EBIT)
HY1: Operating result (EBIT) 151.1 CHF million 75 • Operating result (EBIT) amounted to 14.6 million 50 CHF and improved by 14.6 25 151.1 million CHF -136.5 -50.1 18.5 0 • Not only on group but also -15.4 2.0 -25 -58.2 -27.1 on division level Rieter returned to profit at the -50 operating level -75
Slide 10: HY1: Net result
HY1: Net result +130.2 CHF million 60 • Net result was -15.3 million CHF (-145.5 million CHF in 30 HY1 2009) and increased -145.5 -72.0 -15.3 by 130 million CHF 0 • Financial result amounted -30 to -17.3 million CHF and -60 income taxes to -12.6 x% million CHF in HY1 -90 CO • Net result before taxes
Slide 11: HY1: Balance sheet
HY1: Balance sheet • Sound financial basis CHF million 30.06.10 31.12.09 30.06.09 • Further reduction of non- Total assets 1‘938.6 1‘814.1 1‘838.8 current assets because of Non-current assets 833.3 886.5 895.9 low capex in HY1 Net working capital 69.3 19.6 67.3 • Net liquidity reduced to Net liquidi
Slide 12: HY1: Net working capital
HY1: Net working capital • Volume related increase CHF million 30.06.10 31.12.09 30.06.09 of NWC compared to end of 2009 mainly due to Inventories 308.8 266.0 287.3 inventories and trade receivables Trade receivables 360.7 331.5 300.4 • Increase of advance Other receivables 92.4 99.4 100.1 payments
Slide 13: HY1: Capital expenditure
HY1: Capital expenditure 17% CHF million 40 38.9 • Capex increased from a very low level by 17% main- ly due to capacity expansion 30 of Automotive in Asia 26.7 22.8 • Depreciation and amorti- 35.4 20 zation is 65.2 million CHF 22.8 and 38.5 million CHF higher 20.8 than capex in HY1 10 • Capex will
Slide 14: HY1: Free cash flow
HY1: Free cash flow CHF million HY1 2010 HY1 2009 • Back to positive cash flow in HY1 Net result -15.3 -145.5 • Cash flow increased by Cash flow 44.0 -84.3 128 million CHF vs Net cash flow 45.2 -92.3 2009 +/- Change in net working capital -45.0 78.8 • Cash flow mainly used +/- Capital expenditure, n
Slide 15: HY1: Net liquidity
HY1: Net liquidity CHF million 15 Net liquidity Free Dividends Other Net liquidity cash flow minorities 10 5 10.4 0 -20.8 -5 -10 -18.0 -6.8 -15 -20 -0.8 31.12.2009 30.06.2010 Half year results August 2010 15
Slide 16: HY1: Employees
HY1: Employees 14‘816 15'000 13’256 13‘751 +1'335 -271 • Reduction of 271 permanent 13'500 2'325 jobs in HY1 639 990 12'000 • Reduction by restructuring/ divestiture of 715 partially 10'500 offset by planned capacity 9'000 expansions in Asia in both divisions 7'500 12'617 12'761 • Also Automotive Sy
Slide 17: HY1: Restructuring: Progress of program (status 30.6.10)
HY1: Restructuring: Progress of program (status 30.6.10) 69 69 • Adjustment of plant capacities in North America and Western Europe 22 38 • Sale of non-core activities (IDEA, Perfojet) In Implementation • Majority of projects will be finished in 2010 and bring full savings impact in the course of 20
Slide 18: HY1: Restructuring: Personnel reductions
HY1: Restructuring: Personnel reductions Full time equivalent (FTE) reductions including temporary staff 5 000 4'500 • In two stages a total cut of some 3750 jobs was 4'000 1'500 3'750 1'130 announced 3'500 • 82% of these reductions took place in 2008, 2009 3'000 and HY1 2010 1'230 3075 2'500 2'250
Slide 19: Textile Systems HY1 2010
Textile Systems HY1 2010 Leading systems supplier in the spinning process Half year results August 2010 19
Slide 20: Textile Systems HY1: Orders received
Textile Systems HY1: Orders received CHF million 1'084 • Orders received increased 1'000 904 by 290% 800 739 • Broad upswing with high 710 +290% demand from a number of 618 619 600 countries, but strongest Ø 559 from Turkey, India and 429 417 400 China 321 • Also great demand from 190 200 122 other
Slide 21: Textile Systems HY1: Sales
Textile Systems HY1: Sales +75.1 CHF million 400 +30% • Sales increased by 30% or 75 million CHF 300 • Sales still lagged behind strong order intake as volume of orders received 200 exceeded deliveries • Book-to-bill-ratio in HY1 2.28 100 • Largest sales in India, 249.5 282.5 324.6 China and Turkey
Slide 22: Textile Systems HY1: Operating result (EBIT)
Textile Systems HY1: Operating result (EBIT) + 60.2 CHF million • Marginally positive operating 60 result of 2.0 million CHF which is an improvement of 40 60.2 million CHF • Main drivers are higher 20 sales of 75.1 million CHF -58.2 -15.4 2.0 and the restructuring and 0 cost-cutting programs -20 -40
Slide 23: Automotive Systems HY1 2010
Automotive Systems HY1 2010 Leading supplier of integrated acoustics systems Half year results August 2010 23
Slide 24: Automotive Systems HY1: Sales
Automotive Systems HY1: Sales +226.4 CHF million 1'000 35% • Sales increased by 35% or 226.4 million CHF 800 • Organic growth in all regions thanks to a broad global 600 customer and product portfolio 650.3 774.0 876.7 400 • Strongest sales increase in North and South America 200 and in Asia • Sales
Slide 25: Automotive Systems HY1: Operating result (EBIT)
Automotive Systems HY1: Operating result (EBIT) CHF million +96.5 30 • Operating result rose to 18.5 18.5 million CHF and im- 15 -27.1 proved by 96.5 million CHF -78.0 0 • Improvement due to higher -15 volumes of +226.4 million CHF and effects of the -30 restructuring and cost -45 adjustment program
Slide 26: Outlook 2010
Outlook 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Stoller, Erwin . . Executive . . Chairman . . . . . . . . . . . . . . . . . . .
Slide 27: Measures for the way forward
Measures for the way forward Three directions of impact • Lower break-even point • Accelerate product innovation • Take advantage of opportunities in growth markets Half year results August 2010 27
Slide 28: Strategic steps: Lower breakeven point
Strategic steps forward: The 3 directions of impact 1) Lower breakeven point • By further lowering the break-even point we want to increase our flexibility in the extreme cyclical markets of today • It is our strategic goal to achieve a positive operating result at the level of some 2 billion CHF •
Slide 29: Strategic steps: Accelerate product innovation
Strategic steps forward: The 3 directions of impact 2) Accelerate product innovation Goal: Maintain strong position in both divisions as systems supplier and expand our position in Textile Systems in the mid segment and in Automotive Systems in the small car segment Focus Textile Systems • 4 new pro
Slide 30: Strategic steps: Growth opportunities in China and India
Strategic steps forward: The 3 directions of impact 3) Take advantage of growth opportunities in China and India Turnover in Asia HY1 2010 vs. HY1 2009 • Overproportional growth in Asia: +62% to 264 Mio. CHF • 22% of sales in Asia (Textile: 65%; Automotive: 6%); share growing per year end Locations
Slide 31: Outlook (1)
Outlook (1) Assessment of markets • Rieter as leading supplier to the textile machinery and automotive markets has been participating successfully in the global recovery of the two markets since mid-2009 • Demand developed especially dynamically in the first half of 2010 • Positive consumer sentimen
Slide 32: Outlook (2)
Outlook (2) • Overall, Rieter foresees an improvement in capacity utilization in the second six months driven by demand and due to the ongoing restructuring programs • Rieter expects both divisions to post another positive operating result (EBIT) in the second half and operating margins at group lev
Slide 33: Rieter Group: Values and principles
Rieter Group: Values and principles Half year results August 2010 33
Slide 34: Disclaimer
Disclaimer Rieter is making great efforts to include accurate and up-to-date information in this document, however we make no representations or warranties, expressed or implied, as to the accuracy or completeness of the information provided in this document and we disclaim any liability whatsoever