Mtu Aero Engines Ag · XETR:MTX
Mtu Aero Engines — Q3 2014 Earnings Presentation
24 slides from Mtu Aero Engines's earnings presentation, Oct 23, 2014
Slide 1: Q3 2014 Results - MTU Aero Engines
Q3 2014 Results - MTU Aero Engines Conference Call with Investors and Analysts 23 October 2014
Slide 2: Agenda
Agenda • Business Highlights • Guidance • Financial Highlights - Group Key Figures • Commercial and Military OEM • Commercial MRO • Appendix 23 October 2014 Investor Relations 2
Slide 3: Business Highlights
Business Highlights • IATA passenger traffic up 5.8% ytd. in August 2014 • First flight of A320neo with PW1100G-JM engines • Q3 14 MRO revenues on record level • Strong FCF generation • 2014 Guidance updated 3 23 October 2014 Investor Relations 3
Slide 4: Agenda
Agenda • Business Highlights • Guidance • Financial Highlights - Group Key Figures • Commercial and Military OEM • Commercial MRO • Appendix 23 October 2014 Investor Relations 4
Slide 5: Update on Guidance 2014
Update on Guidance 2014 in m€ FY 2013 adjusted Guidance 2014 Guidance 2014 for MTU Zhuhai July Update October Revenues 3,574.1 ~ 3,650 ~ 3,750 EBIT adj. 373.1 ~ 375 ~ 380 10.4% Net income adj. 235.7 ~ 245 ~ 250 • Series revenues expected to increase in the low teens • Spare parts revenues expected t
Slide 6: Agenda
Agenda • Business Highlights • Guidance • Financial Highlights - Group Key Figures • Commercial and Military OEM • Commercial MRO • Appendix 23 October 2014 Investor Relations 6
Slide 7: Financial Highlights
Financial Highlights Revenues (m€) EBIT adj. / EBIT adj. Margin (m€ / %) 3000 2.660 +6% 2.812 400 10.1% 9.6% 10% 2500 300 268 +1% 271 2000 8% 1500 200 5% 1000 100 3% 500 0 0 0% 9M 2013 9M 2014 9M 2013 9M 2014 Net Income adj. / EPS adj. (m€ / €) * / ** Free Cash Flow (m€) 250 3.50 100 3.33 84 +25% 20
Slide 8: Agenda
Agenda • Business Highlights • Guidance • Financial Highlights – Group Key Figures • Commercial and Military OEM • Commercial MRO • Appendix 23 October 2014 Investor Relations 8
Slide 9: Commercial OEM Business
Commercial OEM Business • Successful first flight of A320neo with PW1100G-JM engines on Sept. 25 • Bombardier Cseries resumed flight testing in Sept. • PurePower engines have completed 11,000 hours of testing • Over 6,000 GTF engines on order or optioned • PW800 will power new Gulfstream business je
Slide 10: OEM Segment
OEM Segment Order book 31/12/2013 31/09/2014 Change Order book in m€ 5,403.6 6,592.8 22% Commercial business in m US$ 6,185.8 7,389.1 19% Military business in m€ 918.2 720.5 -22% (in m€) 9M 2013 9M 2014 Change Revenues 1,770.9 1,915.6 8% Commercial business 1,402.9 1,563.9 11% Military business 368.
Slide 11: OEM Segment
OEM Segment (in m€) 9M 2013 9M 2014 Change Revenues 1,770.9 1,915.6 8% Gross profit 269.7 272.9 1% Gross profit margin 15.2% 14.2% R&D according to IFRS 66.3 54.7 -17% EBIT adj. 185.8 189.4 2% EBIT adj. margin 10.5% 9.9% • Gross Profit margin impacted by business mix effects • R&D down by € 12 m • E
Slide 12: Agenda
Agenda • Business Highlights • Guidance • Financial Highlights - Group Key Figures • Commercial and Military OEM • Commercial MRO • Appendix 23 October 2014 Investor Relations 12
Slide 13: Commercial MRO Business
Commercial MRO Business (in mUS$) 31/12/2013 30/09/2014 Change Contract volume 5,476.4 5,228.2 -5% (in m€) 9M 2013 9M 2014 Change Revenues 911.8 920.8 1% Gross profit 113.8 110.2 -3% Gross profit margin 12.5% 12.0% EBIT adj. 80.5 79.9 -1% EBIT adj. margin 8.8% 8.7% • Contract volume at US$ 5.2 bn •
Slide 14: Agenda
Agenda • Business Highlights • Guidance • Key Financial Highlights - Group Key Figures • Commercial and Military OEM • Commercial MRO • Appendix 23 October 2014 Investor Relations 14
Slide 15: US$ Exchange Rate / Hedge Portfolio
Appendix US$ Exchange Rate / Hedge Portfolio Hedge book as of October 23, 2014 (% of net exposure) (mUS$) 947 (=94%) 720 (=68%) 480 (=43%) 210 (=17%) 2014 2015 2016 2017 1.32 1.30 1.32 1.31 Average hedge rate (US$/EUR) 23 October 2014 Investor Relations 15
Slide 16: Profit & Loss Highlights – New Underlying tax rate of 30%
Appendix Profit & Loss Highlights – New Underlying tax rate of 30% Q3 2013 Q3 2014 Change 9M 2013 9M 2014 Change Revenues 884.7 995.8 13% 2,659.6 2,811.6 6% EBIT adj. 98.1 100.2 2% 267.8 270.9 1% Thereof „at equity“ results 4.4 5.6 12.6 13.2 Interest result -2.7 -1.2 -8.0 -5.9 Interest for pension p
Slide 17: Profit & Loss
Appendix Profit & Loss (in m€) Q3 2013 Q3 2014 Change 9M 2013 9M 2014 Change Revenues 884.7 995.8 13% 2,659.6 2,811.6 6% Total Cost of Sales -750.2 -858.9 -2,271.9 -2,424.6 Gross Profit 134.5 136.9 2% 387.7 387.0 0% Gross Profit Margin 15.2% 13.7% 14.6% 13.8% R&D company funded -22.6 -19.6 -69.1 -58
Slide 18: Segment Revenues and EBIT adj.
Appendix Segment Revenues and EBIT adj. (in m€) Q3 2013 Q3 2014 Change 9M 2013 9M 2014 Change Revenues Group 884.7 995.8 13% 2,659.6 2,811.6 6% OEM Commercial 449.3 531.0 18% 1,402.9 1,563.9 11% OEM Military 144.8 126.2 -13% 368.0 351.7 -4% MRO 298.4 347.9 17% 911.8 920.8 1% Consolidation -7.8 -9.3
Slide 19: Research & Development
Appendix Research & Development (in m€) Q3 2013 Q3 2014 Change 9M 2013 9M 2014 Change Company expensed R&D 38.3 38.2 0% 107.1 98.2 -8% OEM 37.0 37.0 103.6 94.9 MRO 1.3 1.2 3.5 3.3 Capitalization of R&D -15.7 -18.6 -38.0 -40.2 OEM -15.4 -18.6 -37.3 -40.2 MRO -0.3 0.0 -0.7 0.0 R&D according to IFRS 22
Slide 20: Cash Flow
Appendix Cash Flow (in m€) 9M 2013 9M 2014 Change Net Income IFRS 125.2 132.9 6% Depreciation and amortization 120.1 110.8 Change in provisions * -73.1 6.1 Change in Working Capital -39.1 -81.8 Taxes 14.7 -22.3 Interest, derivatives, others -8.6 37.7 Cash Flow from operating activities 139.2 183.4 3
Slide 21: Working Capital
Appendix Working Capital (in m€) 31/12/2013 30/09/2014 Change Change in % Gross Inventories 745.2 744.9 -0.3 Prepayments -547.8 -493.9 53.9 Receivables 784.9 853.0 68.1 Payables -826.5 -866.4 -39.9 Working Capital 155.8 237.6 81.8 53% 23 October 2014 Investor Relations 21
Slide 22: PPA Depreciation / Amortization (in m€)
Appendix PPA Depreciation / Amortization (in m€) (in m€) Q3 2013 Q3 2014 9M 2013 9M 2014 Total depreciation / amortization MTU total 41.1 38.0 120.1 114.3 OEM 33.3 30.2 96.6 91.7 MRO 7.8 7.8 23.5 22.6 PPA depreciation /amortization MTU total 8.9 6.2 26.8 18.7 OEM 8.0 5.6 24.2 16.8 MRO 0.9 0.6 2.6 1.
Slide 23: Net debt of € 476.6 m
Appendix Net debt of € 476.6 m Dec. 31, 2013 Sept 30, 2014 (m€) Financial assets 750 733 Cash and cash 650 99 Equivalents / 27 Other financial assets 600 Net debt Net debt 271 284 € 477 m 450 € 355 m 295 300 Financial liabilities 256 Euro Bond & Private Placement 135 108 V2500 / IAE Flight-Hour- 352
Slide 24: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements Certain of the statements contained herein may be statements of future expectations and other forward-looking statements that are based on management’s current views and assumptions and involve known and unknown risks and uncertainties that could