Schaeffler Ag · XETR:SHA0
Schaeffler — 9M 2015 Earnings Presentation
33 slides from Schaeffler's earnings presentation, Nov 19, 2015
Slide 1: Results 9M 2015 Schaeffler AG Conference Call
Results 9M 2015 Schaeffler AG Conference Call November 19, 2015 Herzogenaurach
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements. The words "anticipate", "assume", "believe", "estimate", "expect", "intend", "may", "plan", "project“, "should" and similar expressions are used to identify forward-looking statements. Forward-looking statements are statements that ar
Slide 3: Agenda
Agenda 1 Overview 2 Operational Highlights 3 Financial Results 4 Outlook 3 November 19, 2015 SchaefflerAG Results 9M 2015 Presentation
Slide 4: Schaeffler Group – On track to achieve 2015 targets
1 Overview Schaeffler Group – On track to achieve 2015 targets Group Results – Sales growth 9M 2015 +10.6%1); 1 EBIT margin 9M 2015 12.5% 2 Automotive Division – Continued outperformance of market growth 3 Industrial Division – Program CORE successfully started 4 Free Cash Flow – Strong FCF generati
Slide 5: Group 9M 2015 Results – Continued profitable growth
2 Operational Highlights 1 Group 9M 2015 Results – Continued profitable growth Sales and EBIT margin Key aspects 9M +10.6% 9,024 9,982 9M 2015 group sales increased to EUR 9,982 mn driven by the strong development in Automotive; FX adjusted growth of 4.2% 9M 2015 EBIT margin back to 12.5% with Q3 EB
Slide 6: Automotive Division – Continued market outperformance
2 Operational Highlights 2 Automotive Division – Continued market outperformance Automotive sales and EBIT margin Key aspects Automotive 9M +12.6% 7,511 9M 2015 Automotive sales up 12.6% (+6.5% FX adjusted); 6,670 continued outperformance of global production (+1.2%); EBIT margin in Q3 at 14.4% Main
Slide 7: Automotive Division – Quality, Technology and Innovation
2 Operational Highlights 2 Automotive Division – Quality, Technology and Innovation High-voltage P2 hybrid module Nissan Quality Award International Grand Prix Award received (OEM New Technologies category) 4 The new P2 hybrid module from Schaeffler is 4 Schaeffler produced its five millionth clutch
Slide 8: Industrial Division – Challenging environment
2 Operational Highlights 3 Industrial Division – Challenging environment Industrial sales and EBIT margin Key aspects Industrial 9M +5.0% 2,471 9M 2015 Industrial Sales up +5.0% (-2.2% FX adjusted) despite 2,354 challenging market conditions; EBIT margin stable at 10% Strong organic growth in Wind P
Slide 9: Industrial Division – Program CORE successfully started
2 Operational Highlights 3 Industrial Division – Program CORE successfully started Overview of Program CORE Key achievements CORE in 2015 Key elements Actions 4 New organization structure with strong regional u Strengthen high-volume market sales focus agreed; new management team in place Optimized
Slide 10: Free Cash Flow – Strong Free Cash Flow generation
2 Operational Highlights 4 Free Cash Flow – Strong Free Cash Flow generation 2014 9M 14 9M 15 Free cash flow development EBITDA 2,172 1,703 1,765 in EUR mn 238 264 Interest paid (520) (388) (430) 135 Interest received 8 4 41 Income taxes paid (277) (197) (247) -19 -12 -60 Working capital change1) (1
Slide 11: Schaeffler IPO - Leverage ratio at 2.3x on a pro forma basis
2 Operational Highlights 5 Schaeffler IPO - Leverage ratio at 2.3x on a pro forma basis Corporate structure post IPO Key elements 4 Target structure implemented; Proceeds used for strategic deleveraging Family Shareholders1) 100% 4 Further repayment of loan note and indebtedness expected in Q4 2015
Slide 12: Overview key financials 9M 2015
3 Financial Results Overview key financials 9M 2015 9M 15 Q3 15 in EUR mn 9M 14 9M 15 Q3 14 Q3 15 vs. 9M 14 vs. Q3 14 Sales 9,024 9,982 +10.6% 3,034 3,250 +7.1% EBITDA 1,703 1,765 3.6% 590 604 +2.4% EBITDA margin 18.9 17.7 -1.2%-pts. 19.4% 18.6% -0.8%-pts. EBIT 1,230 1,251 +1.7% 429 433 +0.9% EBIT m
Slide 13: Sales 9M 2015 up 10.6%
3 Financial Results Sales 9M 2015 up 10.6% Sales 9M 2015 sales by region in EUR mn Y-o-y growth (w/o FX effects) +10.6%1) Asia/Pacific vs 9M 2014 +12.1% (2.4%) 3,345 3,387 10% 3,250 Greater China 3,014 3,034 3,100 2,976 +26.3% (+5.8%) 14% 54% 22% Americas Europe 9,024 9,982 +21.2% (+9.8%) +3.4% (+2.
Slide 14: Automotive division again strongly outperforms market
3 Financial Results Automotive division again strongly outperforms market Sales and market development Automotive Key aspects Europe Americas Greater China Asia/Pacific +15% 4 Engine Systems: +6% +7%1) - Ramp-up of new Thermal Management Module; Strong +5% +4%1) +1% demand for valve train components
Slide 15: Industrial division with mixed development across sectors
3 Financial Results Industrial division with mixed development across sectors Sales by Industrial sector 9M 15 vs 9M 14 (FX-adjusted) Key aspects Heavy 4 Industrial OEM business with mixed development across Industries sectors Power Transmission Production Machinery - Positive development in Renewab
Slide 16: EBIT margin 9M 2015 12.5%
3 Financial Results EBIT margin 9M 2015 12.5% EBIT Key aspects in EUR mn 9M 15 EBIT margin down by 1.1%-points from 13.6% mainly due to: +1.7% vs 9M 2014 4 Reduced gross profit margin (-1.0%-pts) in Industrial business 434 433 418 429 4 Increase in R&D and selling expenses on group level 383 384 (es
Slide 17: Financial Result 9M 2015 EUR 462 mn
3 Financial Results Financial Result 9M 2015 EUR 462 mn Financial result1) Reconciliation Financial Result in EUR mn in EUR mn -53 375 -194 462 EUR -135 mn vs 9M 2014 215 9M Non-cash One-off 9M 2015 valuation effects 176 2015 excl. one-offs and effects loans / refinancing valuation effects 161 as re
Slide 18: Net income 9M 2015 EUR 521 mn
3 Financial Results Net income 9M 2015 EUR 521 mn Net income1) Reconciliation of net income in EUR mn in EUR mn 67 521 135 7 439 21 229 220 215 212 167 142 9M 2014 Δ EBIT Δ Financial Δ Taxes Δ Minorities 9M 2015 Result 439 521 Key aspects 654 4 Improved financial result leads to higher net income -1
Slide 19: Free cash flow 9M 2015 EUR 192 mn
3 Financial Results Free cash flow 9M 2015 EUR 192 mn Free cash flow 9M 2015 ∆ FCF YTD 2015 vs. YTD 2014 in EUR mn in EUR mn 360 192 155 1,765 273 62 -87 -243 -5 -50 743 FCF EBITDA Δ Net Capex Interest Taxes Other FCF 9M 2014 Working payments 9M 2015 Capital 216 Key aspects 1731) 4 Free Cash Flow im
Slide 20: Working Capital improved – Capex on track
3 Financial Results Working Capital improved – Capex on track Working capital Capex1) in EUR mn in EUR mn 357 3,022 2,944 2,900 2,880 2,696 2,778 2,548 244 257 242 202 155 143 857 743 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015 2014 2015 In % of sales In % of sales 5.2 4.7 6.7 11.5 7.3 7.6 7
Slide 21: Leverage ratio as of September 30, 2015 2.7x
3 Financial Results Leverage ratio as of September 30, 2015 2.7x Net financial debt Change in net financial debt in EUR mn in EUR mn 219 41 210 5,950 5,778 6,190 6,245 -88 5,755 5,768 5,778 5,950 5,529 -210 2.7 2.8 2.8 2.7 2.6 2.6 2.7 Q4 2014 FX effect Δ Cash Repayment Bond Other 9M 2015 Position Te
Slide 22: Guidance 2015
4 Outlook Guidance 2015 Sales Profitability Sales growth 4-5%1) EBIT margin 12-13%2) Capex 6-8% of sales Free cash flow Sustainably positive 1) At constant currency 2) Does not include one-off items Quality Innovation Quality policy Further improve R&D expenses 5% of sales Maintain leading position
Slide 23: Financial calendar 2015/2016
4 Outlook Financial calendar 2015/2016 Nov. 19, 2015 Results 9M 2015 Nov. 20, 2015 Analyst Day, Herzogenaurach Société Générale Premium Review, Paris Dec. 2/3, 2015 Goldman Sachs Global Automotive Conference, London Jan. 12/13, Deutsche Bank Global Auto Industry Conference, Detroit 2016 Commerzbank
Slide 24: IR contact
IR contact Investor Relations phone: + 49 9132 82 4440 Christoph Beumelburg +49 (0)9132 82 5414 fax: + 49 9132 82 4444 Niels Fehre +49 (0)9132 82 85805 Email:ir@schaeffler.com Susanne Sievers +49 (0)9132 82 4408 Web: www.schaeffler.com/ir 24 November 19, 2015 SchaefflerAG Results 9M 2015 Presentatio
Slide 25: Sales per division
Backup Sales per division Sales Automotive division Sales Industrial division in EUR mn in EUR mn 2,510 2,554 2,447 2,227 2,231 2,316 2,212 835 833 803 803 787 784 764 8,986 7,511 3,138 2,471 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015 2014 2015 Growth rate y-o-y Growth rate y-o-y +11.3% +6.
Slide 26: EBIT per division
Backup EBIT per division EBIT Automotive division EBIT Industrial division in EUR mn in EUR mn 342 352 326 319 301 305 292 110 92 92 82 79 81 285 252 1,238 999 1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015 2014 2015 EBIT margin in % EBIT margin in % 14.7 13.5 14.3 12.6 13.6 11.9 14.4 12.0 10
Slide 27: Overview on current corporate and financing structure
Backup Overview on current corporate and financing structure Corporate structure (as of November 12, 2015) Pro forma financing structure Post prepayments from IPO proceeds in October 2015 TopCo Nominal INA-Holding Schaeffler Debt instrument Interest Maturity Rating GmbH & Co. KG (mn) 100% HoldCo Loa
Slide 28: Overview permitted upstream payments
Backup Overview permitted upstream payments Permitted upstream payments after IPO Comment Chart simplified for illustration u On October 9, 2015 Schaeffler requested the guarantees by INA Holding purposes Schaeffler Verwaltung Zwei GmbH and Schaeffler TopCo Schaeffler GmbH & Co. KG Beteiligungsholdi
Slide 29: Profit & Loss statement 2012 – 9M 2015
Backup Profit & Loss statement 2012 – 9M 2015 in EUR mn 2012 2013 2014 9M 14 9M 15 Sales 11,125 11,205 12,124 9,024 9,982 Cost of Sales (7,836) (8,029) (8,654) (6,460) (7,153) Gross Profit 3,289 3,176 3,470 2,564 2,829 R&D (593) (611) (626) (473) (534) Selling expenses (759) (761) (827) (596) (687)
Slide 30: Cash flow statement 2012 – 9M 2015
Backup Cash flow statement 2012 – 9M 2015 in EUR mn 2012 2013 2014 9M 14 9M 15 EBIT 1,469 1,008 1,523 1,230 1,251 Interest paid (581) (605) (520) (388) (430) Interest received 9 8 8 4 41 Income taxes paid (229) (378) (277) (197) (247) Dividends received 1 1 1 0 0 Depreciation, amortization and impai
Slide 31: Cash flow statement 2012 – 9M 2015 (continued)
Backup Cash flow statement 2012 – 9M 2015 (continued) in EUR mn 2012 2013 2014 9M 14 9M 15 Free cash flow 301 473 48 (87) 192 Dividends paid to shareholders and non-controlling interests (1) (1) (1) (1) (251) Receipts from loans 395 27 727 610 208 Repayments of loans (449) (649) (429) (192) (209) Ch
Slide 32: Balance sheet 2012 – 9M 2015
Backup Balance sheet 2012 – 9M 2015 in EUR mn Assets 2012 2013 2014 9M 14 9M 15 Intangible assets 554 538 555 532 559 Property, plant and equipment 3,515 3,369 3,748 3,511 3,961 Investments in equity-accounted 3 3 4 3 3 Other investments 14 14 14 14 14 Other financial assets 78 202 1,9601) 113 2,293
Slide 33: Balance sheet 2012 – 9M 2015 (continued)
Backup Balance sheet 2012 – 9M 2015 (continued) in EUR mn Shareholders’ equity and liabilities 2012 2013 2014 9M 14 9M 15 Share capital 500 500 600 500 600 Capital reserves 0 0 1,600 0 1,600 Other reserves (2,796) (2,031) (1,276) (1,592) (1,005) Accumulated other comprehensive income (loss) (362) (4