Trelleborg Ab Class B · OMXSTO:TREL_B

Trelleborg Ab Class B — Q2 2013 Earnings Presentation

41 slides from Trelleborg Ab Class B's earnings presentation, Jul 23, 2013

  1. Slide 1: April – June 2013

    April – June 2013 Peter Nilsson, President & CEO Ulf Berghult, CFO

  2. Slide 2: Highlights, Business areas, TrelleborgVibracoustic, Financials

    Highlights Business areas TrelleborgVibracoustic Financials Summary & Q3 2013 outlook Q&A 2 2013-07-23

  3. Slide 3: Q2 2013 highlights

    Continuous improvements Q2 2013 highlights  Mixed sales development - flat on Group level due to currency. Organic sales grew by 2%  Organic sales in Western Europe grew 1% while Asia Pacific was up 12%. China increased by 9%, while North America fell by 10%  Good cost control and improved effici

  4. Slide 4: Organic growth initiatives and acquisitions

    Organic growth initiatives and acquisitions Recap of Q2 2013 events  One bolt-on acquisition; buoyancy and insulation solutions used primarily in deep-sea environments and ROVs  Successful participation in both Hannover Fair and Offshore Technology Conference in Houston – new innovations launched

  5. Slide 5: Underlying EBIT and margin improve again

    Underlying EBIT and margin improve again Group financial highlights1 Net sales SEK M Q2 2013 Q2 2012 Change, %  Organic sales up 2% Net sales 5 628 5 612 0.3  Mixed segments and markets Organic 2 -2 development Structural 4 1 Exchange rate -6 2 Earnings Operating profit excl. items affecting compa

  6. Slide 6: Highlights, Business areas, TrelleborgVibracoustic, Financials

    Highlights Business areas TrelleborgVibracoustic Financials Summary & Q3 2013 outlook Q&A 6 2013-07-23

  7. Slide 7: Still challenging market conditions

    Still challenging market conditions Trelleborg Coated Systems1  Organic sales: -6% SEK M1,2 Q2 2013 Q2 2012 Change, %  Weaker in Europe while more Net sales 477 464 2.8 stable in Americas Organic, % -6 -6  Sales and EBIT hit by the weak Structural, % 14 - Japanese Yen Exchange rate, % -5 4  Prof

  8. Slide 8: Profitability continues to improve

    Profitability continues to improve Trelleborg Industrial Solutions1  Organic sales: +2% SEK M1,2 Q2 2013 Q2 2012 Change, %  Most end-user segments and Net sales 1 140 1 162 -1.9 geographies on par with last year Organic, % 2 -8  Strong earnings and margin Structural, % 0 2 development Exchange ra

  9. Slide 9: Good performance and healthy demand

    Good performance and healthy demand Trelleborg Offshore & Construction1  Organic sales: +9% SEK M1,2 Q2 2013 Q2 2012 Change, %  Activity remains high in most Net sales 978 929 5.3 market segments Organic, % 9 5  Strong earnings and margin Structural, % 3 - development Exchange rate, % -7 6  Bett

  10. Slide 10: Solid quarter despite currency headwind

    Solid quarter despite currency headwind Trelleborg Sealing Solutions1  Organic sales: -1% SEK M1,2 Q2 2013 Q2 2012 Change, %  Most segments on par with last Net sales 1 833 1 944 -5.7 year Organic, % -1 -1  Europe more stable, sales in N.A. Structural, % 0 0 hurt by inventory adjustments Exchange

  11. Slide 11: Strong performance in mixed market conditions

    Strong performance in mixed market conditions Trelleborg Wheel Systems1  Organic sales: -1% SEK M1,2 Q2 2013 Q2 2012 Change, %  Agriculture tires in line with last Net sales 1 111 1 052 5.6 year Organic, % -1 4  Weaker demand for industrial tires, Structural, % 13 - especially in Europe Exchange

  12. Slide 12: Highlights, Business areas, TrelleborgVibracoustic, Financials

    Highlights Business areas TrelleborgVibracoustic Financials Summary & Q3 2013 outlook Q&A 12 2013-07-23

  13. Slide 13: Creating shareholder value

    Creating shareholder value Global leader in automotive antivibration solutions  Revenue and cost synergies  Sustainable growth above market development  Unrivalled global footprint - awards on back of global platform development  EBIT-margin that exceeds industry average  First operational year

  14. Slide 14: Good growth and stronger results

    Good growth and stronger results TrelleborgVibracoustic  Organic sales: +7%, well ahead of EUR M1,2 Q2 2013 Proforma3 Q2 2012 Change, % global light vehicle production Net sales 445 411 8.3  Good sales development in North Organic, % 7 America, China and Brazil Structural, % 1  Earnings and margi

  15. Slide 15: Associated income bridge

    Associated income bridge TrelleborgVibracoustic  Associated income of 97 MSEK SEK M Q2 2013 Q2 20122 Change, % (after financial net of -24 MSEK and Operating profit excl items 263 - - affecting comparability -11 MSEK of non-recurring costs) Acquisition related costs -13 - -  Associated income of 1

  16. Slide 16: Highlights, Business areas, TrelleborgVibracoustic, Financials

    Highlights Business areas TrelleborgVibracoustic Financials Summary & Q3 2013 outlook Q&A 16 2013-07-23

  17. Slide 17: Solid quarter despite currency headwind

    Solid quarter despite currency headwind Sales development 0% 5 612 5 628 Organic 2% Structural change 4% Apr-Jun Currency -6% Total 0% 2012 2013 -3% 11 335 11 022 Organic -2% Jan-Jun Structural change 4% Currency -5% Total -3% 2012 2013 17 2013-07-23

  18. Slide 18: Organic growth target: ≥ 5% average

    Organic growth target: ≥ 5% average Organic sales development % 20% 18 19 18 15 15% 12 10% 8 6 5% 5% 2 2 0 0% -1 -2 -2 -5% -5 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 10 10 10 10 11 11 11 11 12 12 12 12 13 13 18 2013-07-23

  19. Slide 19: Sales better than underlying markets

    Sales better than underlying markets Sales per business area Apr-Jun Jan-Jun SEK M 2013 2012 Change % Organic % 2013 2012 Change % Organic % 477 464 3 -6 Trelleborg Coated Systems 940 933 1 -6 1 140 1 162 -2 2 Trelleborg Industrial Solutions 2 234 2 364 -6 -2 978 929 5 9 Trelleborg Offshore & Constr

  20. Slide 20: Slight sales growth

    Slight sales growth Sales development, R12M SEK M SEK M 6 000 22 000 20 000 5 000 18 000 16 000 4 000 14 000 12 000 3 000 10 000 2 000 8 000 6 000 1 000 4 000 2 000 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 10 10 10 10 11 11 11 11 12 12 12 12 13 13 Quarter (LHS) R12M (RHS) 20 2013-07-23

  21. Slide 21: Parts of Europe show recovery

    Parts of Europe show recovery Organic sales by geographic markets Western Europe Share Apr-Jun Jan-Jun 56% 1% -2% Other Europe North America Share Apr-Jun Jan-Jun Share Apr-Jun Jan-Jun 5% 37% 25% 20% -10% -11% Asia & Other markets Share Apr-Jun Jan-Jun 16% 12% 4% South & Other America Share Apr-Jun

  22. Slide 22: All-time-high operating margin

    All-time-high operating margin 1 Operating profit development Operating profits Operating margins +3% 0,3 702 723 12,5% 12,8% Apr-Jun Actual 12 Actual 13 Actual 12 Actual 13 0% 0,2 1 368 1 362 12,1% 12,3% Jan-Jun Actual 12 Actual 13 Actual 12 Actual 13 22 2013-07-23 1) Excluding items affecting comp

  23. Slide 23: Trelleborg Industrial Solutions keeps improving

    Trelleborg Industrial Solutions keeps improving 1 Group operating profit per business area Apr-Jun Jan-Jun SEK M 2013 2012 Change 2013 2012 Change 52 53 -2% Trelleborg Coated Systems 112 110 2% 110 76 45% Trelleborg Industrial Solutions 206 165 25% 81 67 21% Trelleborg Offshore & Construction 128 11

  24. Slide 24: Overall EBIT-margin target of 12%

    Overall EBIT-margin target of 12% 1 EBIT and margin, R12M MSEK % 2 500 14,0% 12,0% 2 000 10,0% 1 500 8,0% 1 000 6,0% 4,0% 500 2,0% 0 0,0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 10 10 10 10 11 11 11 11 12 12 12 12 13 13 ROS % R12M EBIT 24 2013-07-23 1) Excluding items affecting comparability & Tre

  25. Slide 25: Total Group - including discontinued business

    Total Group - including discontinued business Profit & Loss statement Apr-Jun Jan-Jun SEK M 2013 2012 Change 2013 2012 Change 723 702 3% Operating profit, Continuing operations 1 362 1 368 0% 12,8% 12,5% 0,3pp Operating margin 12,3% 12,1% 0,2pp -49 -32 Restructuring costs -86 -51 -155 203 One-off it

  26. Slide 26: Operating profit bridge

    Operating profit bridge Year-on-year comparison Operating Associated Operating profit, profit, = Items income from Operating profit, Discontinued Continuing Restructuring One-off affecting Trelleborg- Continuing operations incl. Operating profit, operations costs items comparability Vibracoustic ope

  27. Slide 27: TrelleborgVibracoustic

    TrelleborgVibracoustic Impact on Trelleborg’s accounts Apr-Jun Jan-Jun SEK M 2013 2013 Operating profit excl. items affecting comparability 263 501 Acquistion related costs -13 -18 Amortization on intangible assets -9 -19 Restructuring costs 0 -7 Operating profit 241 457 Financial net -47 -43 Profit

  28. Slide 28: Underlying EPS increased by 8 percent

    Underlying EPS increased by 8 percent Earnings per share – second quarter % -58% 3,5 3,35 -46% 3,0 2,60 +8% 2,5 2,10 1,95 2,0 1,5 1,40 1,40 1,0 0,5 0,0 Group, Total Continuing operations Continuing operations excl items affecting comparability 2012 2013 28 2013-07-23

  29. Slide 29: Solid working capital management

    Solid working capital management 1 Operating cash flow -10% 590 7 34 100 531 Apr-Jun Actual 12 EBITDA Net capex Working capital Actual 13 +2% 522 23 47 14 532 Jan-Jun Actual 12 EBITDA Net capex Working capital Actual 13 29 2013-07-23 1) Excluding items affecting comparability & TrelleborgVibracousti

  30. Slide 30: Solid cash conversion

    Solid cash conversion 1 Operating cash flow, R12M MSEK % 3 500 168 180 118 3 000 96 100 97 2 500 91 90 100 80 78 2 000 70 72 73 80 69 65 1 500 60 1 000 40 500 20 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 10 10 10 10 11 11 11 11 12 12 12 12 13 13 Cash conversion % Operating cash flow 30 2013-07-2

  31. Slide 31: Solid capital structure

    Solid capital structure 1 Net debt development -4% -5 360 -6 409 -6 425 -6 691 -6 440 -8 369 -12 706 2008 2009 2010 2011 2012 Q2 12 Q2 13 31 2013-07-23 1) Total Group

  32. Slide 32: Solid capital structure

    Solid capital structure 1 Net debt / EBITDA and net gearing development % X 6,9 140 7 124 120 6 100 5 4,3 80 4 68 -4% +29% 60 53 3 48 48 46 2,2 38 2,1 40 2 1,8 1,7 1,4 20 1 0 0 2008 2009 2010 2011 2012 Q2 Q2 2008 2009 2010 2011 2012 Q2 Q2 12 13 12 13 Net gearing Net debt / EBITDA 32 2013-07-23 1) To

  33. Slide 33: Ratio for continuing operations still improving

    Ratio for continuing operations still improving Net debt / EBITDA X +29% 0% -14% 2,5 2,2 2,2 2,2 2,2 2,0 1,9 1,7 1,5 1,0 0,5 0,0 Group, Total Continuing operations Continuing operations excl items affecting comparability 2012 2013 33 2013-07-23

  34. Slide 34: Long-term ROE target of 15%

    Long-term ROE target of 15% Return On Equity, R12M % 18 -27% 16 15,0% -16% +6% 15,0% 14 13,0% 13,2% 12,5% 12 11,0% 10,9% 10 8 6 4 2 0 Group, Total Continuing operations Continuing operations excl items affecting comparability Act 2012 R12 jun 13 34 2013-07-23

  35. Slide 35: Highlights, Business areas, TrelleborgVibracoustic, Financials

    Highlights Business areas TrelleborgVibracoustic Financials Summary & Q3 2013 outlook Q&A 35 2013-07-23

  36. Slide 36: Q2 2013 highlights

    Continuous improvements Q2 2013 highlights  Mixed sales development - flat on Group level due to currency. Organic sales grew by 2%  Organic sales in Western Europe grew 1% while Asia Pacific was up 12%. China increased by 9%, while North America fell by 10%  Good cost control and improved effici

  37. Slide 37: Continued focus on growth and excellence

    Continued focus on growth and excellence 2013 priorities  Manage uncertain market conditions  Continued focus on profitable growth, selected segments and geographies  Manage margin development through operational excellence  Continued portfolio management to improve leading positions  Trellebor

  38. Slide 38: Outlook Q3 2013

    Outlook Q3 2013  Demand in the third quarter is expected to be in line with the second quarter of 2013, adjusted for seasonal variations 38 2013-07-23

  39. Slide 39: Highlights, Business areas, TrelleborgVibracoustic, Financials

    Highlights Business areas TrelleborgVibracoustic Financials Summary & Q3 2013 outlook Q&A 39 2013-07-23

  40. Slide 40: 40 2013-07-23

    40 2013-07-23

  41. Slide 41: Forward-looking statements

    Forward-looking statements This presentation contains forward-looking statements that are based on the current expectations of the management of Trelleborg. Although management believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that

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