Schindler Holding Ltd. · SIX:SCHN
Schindler — Schindler Hldg Ag Akt — FY2022 Earnings Presentation
38 slides from Schindler's earnings presentation, Feb 22, 2023
Slide 1: Annual results 2022 presentation
Annual results 2022 presentation February 22, 2023 © Schindler 2023 I © Schindler 2023 I We Elevate I February 22, 2023 I
Slide 2: I © Schindler 2023 I We Elevate I February 22, 2023 I Investor Relations
2 I © Schindler 2023 I We Elevate I February 22, 2023 I Investor Relations
Slide 3: Key messages
Key messages Markets Order intake Revenue and profit Declining New Installations, Growth in Service and recovery growth in Service and Modernization, reduction in in the second half Modernization New Installations of the year New strategic Progress on resolving Supply chain framework for legacy issu
Slide 4: Agenda
Agenda 1. Highlights Silvio Napoli 2. Market update Silvio Napoli 3. Strategic framework Silvio Napoli 4. Financial results 2022 Carla De Geyseleer 5. Outlook 2023 Carla De Geyseleer 6. Q&A Silvio Napoli/Carla De Geyseleer 4 I © Schindler 2023 I We Elevate I February 22, 2023 I Investor Relations
Slide 5: Highlights 2022
Highlights 2022 Finland, Germany, the “Green service” Recovery of operating results Netherlands, Spain and contracts launched EBIT adj. in CHF million Sweden –99.5% CO2-emission vs. classic offering 600 9.0% 8.5% 9.2% 10.2% 12.0% 10.0% in “2022 best Swiss employers” 2. Handelszeitung ranking 400 309
Slide 6: Progressing on challenges
Progressing on challenges Resolving legacy issues, adjusting to fast-evolving market conditions Challenges Progress #1: Dealing with foreign exchange burden #2: Regaining competitive New Installations margins #3: Resolving supply chain disruptions #4: Streamlining product portfolio complexity Januar
Slide 7: Regaining competitive New Installations margins
Regaining competitive New Installations margins Strong progress on pricing drives improvement in order intake margins Realized price increases New Installations (YTD) New Installations order intake – year-on-year margin development Δ percentage Americas ++++ points EMEA ++++ China flat Low single-di
Slide 8: Legacy backlog weighs on profitability
Legacy backlog weighs on profitability Impact phasing out over the next three years >40% of dilutive backlog digested in 2022 100% 0% 2022 2023 2024 2025+ 8 I © Schindler 2023 I We Elevate I February 22, 2023 I Investor Relations
Slide 9: Agenda
Agenda 1. Highlights Silvio Napoli 2. Market update Silvio Napoli 3. Strategic framework Silvio Napoli 4. Financial results 2022 Carla De Geyseleer 5. Outlook 2023 Carla De Geyseleer 6. Q&A Silvio Napoli/Carla De Geyseleer 9 I © Schindler 2023 I We Elevate I February 22, 2023 I Investor Relations
Slide 10: Market environment
Market environment Resilient business model to overcome persistent challenges Rising capital cost China market Stabilizing recovery Record inflation energy crisis Labor constraints Raw material costs stabilizing Geopolitical Sustained pricing re-alignment momentum Supply chain risks 10 I © Schindler
Slide 11: China: >60% of global market, easing downturn
China: >60% of global market, easing downturn No recovery before second half of 2023 Floor space sold showing early signs of recovery1) Housing inventory improving in tier 1 cities2) Latest developments Months of 120% consumption ▪ Government’s 16-point “rescue plan” 100% 30 ▪ Easing of the ‟three-r
Slide 12: China: E&E transition to Service and Modernization
China: E&E transition to Service and Modernization China E&E installed base at ~50% of global market China Modernization to reach 50% of global market by 2030 million units thousand units 16 600 14 500 12 400 10 8 300 6 200 4 100 2 0 0 2018 2019 2020 2021 2022 2030E 2018 2019 2020 2021 2022 2030E Up
Slide 13: Agenda
Agenda 1. Highlights Silvio Napoli 2. Market update Silvio Napoli 3. Strategic framework Silvio Napoli 4. Financial results 2022 Carla De Geyseleer 5. Outlook 2023 Carla De Geyseleer 6. Q&A Silvio Napoli/Carla De Geyseleer 13 I © Schindler 2023 I We Elevate I February 22, 2023 I Investor Relations
Slide 14: Eight themes shape E&E industry competitiveness
Eight themes shape E&E industry competitiveness 1 Fiercer competition with disciplined execution 2 3 4 New Installations declining – cost Existing Installations and MOD growing: Service price pressure from and efficiency more vital than ever digital and sustainability as differentiators low-cost Ind
Slide 15: Our response: strategic framework for disciplined execution
Our response: strategic framework for disciplined execution Our purpose Enhancing the quality of life in urban environments by providing the best mobility solutions across buildings Our ambition Our choices Our targets ▪ Be the preferred E&E customer choice ▪ Service: Drive density ▪ Best-in-class c
Slide 16: Schindler's net-zero commitment
Schindler’s net-zero commitment Our commitment Our execution Public commitment to reduce absolute CO2 emissions vs. 2020 Generate “green revenue” in our markets –50% –42% Reduce building & process Improve energy efficiency By 2030 emissions of our products Scope 1/2 Scope 3 By 2040 –90% Scope 1/2/3
Slide 17: Shanghai five-star Green Factory 2022 Award for Jiading Campus
Shanghai five-star Solar power generating system Green Factory 2022 Award covering up to 80% of annual for Jiading Campus electricity consumption 17 I © Schindler 2023 I We Elevate I February 22, 2023 I Investor Relations
Slide 18: Re-launch of simplified modular elevator platform
Re-launch of simplified modular elevator platform State-of-the-art Standardization Full connectivity combination of Faster installation, with high cyber- physical and digital shorter lead times security level technologies User experience Net zero ready Innovative digital driven functionality Materia
Slide 19: Agenda
Agenda 1. Highlights Silvio Napoli 2. Market update Silvio Napoli 3. Strategic framework Silvio Napoli 4. Financial results 2022 Carla De Geyseleer 5. Outlook 2023 Carla De Geyseleer 6. Q&A Silvio Napoli/Carla De Geyseleer 19 I © Schindler 2023 I We Elevate I February 22, 2023 I Investor Relations
Slide 20: Results in a nutshell
Results in a nutshell Revenue and profit recovery in 2nd half 2022, improving order intake margins Fourth quarter 2022 Full year 2022 Order intake slowing Recovery of revenue 7’000.00 6’800.00 6’600.00 6’400.00 +4% 6’200.00 6’000.00 service portfolio growth 5’800.00 Order intake Order intake5’600.00
Slide 21: Fourth quarter 2022 key figures
Fourth quarter 2022 key figures Progressive improvement in revenue, margin recovery confirmed In CHF million Q4 2022 Q4 2021 r% r% in LC Order intake 2 994 3 128 –4.3 –2.7 Revenue 3 036 2 954 2.8 4.7 Operating profit (EBIT) 249 253 –1.6 1.2 in % 8.2 8.6 Operating profit (EBIT), adjusted 309 1) 306 2
Slide 22: Full year 2022 key figures
Full year 2022 key figures Growth, profitability, and cash flow impacted by external and internal challenges In CHF million FY 2022 FY 2021 r% r% in LC Order intake 11 961 12 166 –1.7 –0.2 Revenue 11 346 11 236 1.0 2.5 Operating profit (EBIT) 904 1 166 –22.5 –20.6 in % 8.0 10.4 Operating profit (EBI
Slide 23: Order intake
Order intake Lower order intake in line with market decline, at improved profitability Fourth quarter January to December in CHF million in CHF million –0.2% –1.7% 3 128 –2.7% 2 994 –4.3% Q4 2021 Q4 2022 Growth in local currencies (LC) Growth in reported currency 23 I © Schindler 2023 I We Elevate I
Slide 24: Order intake: shift from volume to value and margin
Order intake: shift from volume to value and margin Full year growth in Modernization and Service mitigating decline in New Installations Order intake growth Q4 2022 vs. Q4 2021 Order intake growth 12M 2022 vs. 12M 2021 APAC APAC China w/o China Americas EMEA Global China w/o China Americas EMEA Glo
Slide 25: Revenue
Revenue Continued recovery in Q4 across all regions and product lines Quarterly development January to December in CHF million in CHF million +2.5% +1.0% +0.6% +1.9% –4.6% +7.9% +4.7% +0.9% +1.2% –5.6% +5.6% +2.8% 3 036 2 965 EMEA ++ 2 954 Americas ++ China ––– Rest AP ++ 2 713 2 632 Q4 21 Q1 22 Q2
Slide 26: EBIT adjusted and EBIT
EBIT adjusted and EBIT Measures implemented drive margin recovery, Q4 impacted by one-offs Quarterly development January to December in CHF million in CHF million EBIT adjusted EBIT 600 12.00% 600 12.00% 10.4% 10.2% 9.2% 9.0% 8.5% 10.00% 8.5% 8.2% 10.00% 8.6% 8.0% 7.1% 400 8.00% 400 8.00% 306 309 27
Slide 27: Operating cash flow
Operating cash flow Impact from lower operating profit and increased net working capital Fourth quarter January to December in CHF million in CHF million + Growth in Maintenance & Repairs – Cost inflation – China lockdowns – Supply chain disruptions + Lower income tax payments – Inventory + Other no
Slide 28: Dividend
Dividend Proposal to the Annual General Meeting of CHF 4.00 5.00 4.00 3.00 Dividend proposal 2.00 Ordinary dividend 1.00 0.00 2018 2019 2020 2021 2022 45.5 49.8 59.5 52.0 70.5 Pay-out ratio (%) Dividend yield, closing price registered share 1.9 1.7 1.6 1.8 2.1 on the day of Board decision (%) 28 I ©
Slide 29: Sustainability goals 2018 – 2022: Five of six targets met
Sustainability goals 2018 – 2022: Five of six targets met 25% CO2 vehicle fleet emission reduction target missed by 0.3pp Enhance safety –46% Reduce the number of employee incidents and injuries by Goal: –20% improving our Total Case Rate (TCR) by 20% compared to 2017 Attract diverse talent 26% Incr
Slide 30: Agenda
Agenda 1. Highlights Silvio Napoli 2. Market update Silvio Napoli 3. Strategic framework Silvio Napoli 4. Financial results 2022 Carla De Geyseleer 5. Outlook 2023 Carla De Geyseleer 6. Q&A Silvio Napoli/Carla De Geyseleer 30 I © Schindler 2023 I We Elevate I February 22, 2023 I Investor Relations
Slide 31: Market outlook 2023 (units)
Market outlook 2023 (units) New Installations decline mainly driven by China Service and Modernization growing across all regions 2022 Outlook 2023 APAC Global China w/o China Americas EMEA Global New Installations ––– ––– ++ Flat + –– Liquidity India: U.S. Europe: Contracting constraints expanding
Slide 32: Outlook for 2023
Outlook for 2023 Business environment Key actions ▪ Global economy to slow down further amid Disciplined execution of strategic priorities focusing on: signs of resilience and China recovery ▪ Pricing ▪ Persisting cost inflation and labor scarcity ▪ Efficiency and cost reduction drive ▪ Construction
Slide 33: Q&A
Q&A February 22, 2023 © Schindler 2023 I © Schindler 2023 I We Elevate I February 22, 2023 I
Slide 34: Additional charts
Additional charts 34 I © Schindler 2023 I We Elevate I February 22, 2023 I Investor Relations
Slide 35: Quarterly overview
Quarterly overview Key figures In CHF million 2022 2021 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Order intake 2 994 2 740 3 063 3 164 3 128 2 995 3 106 2 937 Revenue 3 036 2 965 2 713 2 632 2 954 2 807 2 873 2 602 Operating profit (EBIT) 249 252 192 211 253 306 319 288 in % 8.2 8.5 7.1 8.0 8.6 10.9 11.1 11.1 Operati
Slide 36: Balance sheet
Balance sheet In CHF million 31.12.2022 31.12.2021 in % in % Cash and cash equivalents 2 153 18.2 2 841 23.7 Other current assets 5 956 50.5 5 436 45.4 Total current assets 8 109 68.7 8 277 69.1 Non-current assets 3 699 31.3 3 697 30.9 Total assets 11 808 100.0 11 974 100.0 Current liabilities 6 252
Slide 37: Top Speed program: continuous progress of key deliverables
Top Speed 23 program Continuous progress of key deliverables – program to be closed in 2023 Core initiatives Status Progress vs. target EBIT impact (from year) New Installations growth in Re-focus on profitable New Installations completed selected strategic markets growth 2022 Portfolio growth/inves
Slide 38: Financial calendar 2023
Financial calendar 2023 2023 2024 Full year results analyst and media conference February Ordinary General Meeting Schindler Holding Ltd. March 28 March 19 Publication of key figures as of March 31 April 20 April Publication of Interim Report as of June 30 July 21 July Publication of key figures as