Volkswagen Ag · XETR:VOW
Volkswagen — H1 2022 Earnings Presentation
35 slides from Volkswagen's earnings presentation, Jul 28, 2022
Slide 1: Leading the Transformation
Leading the Transformation Investor, Analyst and Media Call H1 2022 July 28, 2022
Slide 2: Investor, Analyst and Media Call H1 2022 speakers
Investor, Analyst and Media Call H1 2022 Arno Antlitz Rolf Woller Nicole Mommsen Chief Financial Head of Head of Officer Group Treasury Group Communications Volkswagen AG and Volkswagen AG Investor Relations Volkswagen AG 2
Slide 3: Disclaimer
Disclaimer The following presentations as well as remarks/comments and explanations in this context contain forward-looking statements on the business development of the Volkswagen Group. These statements are based on assumptions relating to the development of the economic, political and legal envir
Slide 4: Key Highlights H1 2022
Key Highlights H1 2022 ID. Buzz A6 Avant e-tron Taycan GTS Enyaq iV Coupé Sport Turismo ID.5 Pro • Continued robustness demonstrated despite ongoing semiconductor shortage, the Ukraine war and Covid-19 impacts Revenues almost stable (adj. for first time consolidation of Navistar totaling € 4.7bn)
Slide 5: Deliveries in 2022 improving towards end of Q2
Deliveries in 2022 improving towards end of Q2 Deliveries Volkswagen Group Key Takeaways [‘000 units / per month] 2022 • Semiconductor shortage, Covid-19 and Ukraine-Russia 2021 conflict impacts H1 deliveries 1,100 • BEV share is slightly increasing 1,000 • Demand for well-equipped cars continues 90
Slide 6: BEV sales expected to significantly rise in H2
BEV sales expected to significantly rise in H2 Quarterly development Outlook BEV Share [%]; BEV Deliveries [‘000 units] 8.3% 7-8% 6.0% 6.2% 5.2% 5.1% 4.4% 2.5% 60 99 111 118 122 160 453 Q1 Q2 Q3 Q4 2021 2022e 2021 2022 ID.Buzz: Vehicle is a near-production concept car Porsche Taycan GTS Sport Turism
Slide 7: Global Roll out of BEV production as of H1 2022
Global Roll out of BEV production as of H1 2022 Ramp up of re-tooled MEB plants Emden, Hanover and Chattanooga will support scale USA Europe China Emden Hanover Brussels Zwickau Chattanooga Mlada Boleslav Anting Zuffenhausen Foshan VW ID.4 (NAR) VW ID.3 VW ID.4 AU Q4 e-tron VW ID.3 VW ID.4 X/CROZZ V
Slide 8: PowerCo established to bundle Group-wide battery activities
PowerCo established to bundle Group-wide battery activities and set up cell factories (Groundbreaking July 2022) 3D Visualization Key Takeaways • Salzgitter cell Factory to be blueprint and starting point for global battery offensive • Targeted start of production of Salzgitter plant in 2025 • Stand
Slide 9: Solid figures despite lower sales are testimony to our robust business model
Solid figures despite lower sales are testimony to our robust business model January to June 2019 vs. 2021 vs. 2022 Vehicle Sales Sales Revenue Operating Result and Margin 1 [m vehicles] [€ bn] [€ bn] Margin [%] +6% 8.0% 8.8% 10.0% 129.7 132.3 125.2 13.2 11.4 10.0 -25% 5,339 4,660 4,006 H1 H1 H1 H1
Slide 10: Automotive Net Cash in H1 impacted by Changes in Working Capital (1/2)
Automotive Net Cash in H1 impacted by Changes in Working Capital in preparation for higher sales in H2; Automotive Net Liquidity remains solid (1/2) January to June 2019 vs. 2021 vs. 2022 Reported Net Cash Flow 1 'Clean' Net Cash Flow 1, 2 Net Liquidity 1 [€ bn] [€ bn] [€ bn] 35.0 28.2 15.9 12.3 10.
Slide 11: Automotive Net Liquidity remains solid (2/2)
Automotive Net Liquidity remains solid (2/2) [€ bn] Reported Net Cash flow (€ 2.3bn) Clean Net Cash flow (€ 5.8bn) 0.5 -0.9 -2.6 5.3 1.1 28.2 -3.8 26.7 1.9 thereof thereof dividends € -4.7bn increase from Financial in inventories Services Division € 2.0bn 31.12.2021 Operating Dividend of Diesel M&A
Slide 12: Solid Margins in Passenger Cars and Financial Services Division
Solid Margins in Passenger Cars and Financial Services Division January to June 2019 vs. 2021 vs. 2022 Automotive Division Financial Services Division Passenger Cars 1, 2 Commercial Vehicles 3 Financial Services Operating Result [€ bn] Operating Result [€ bn] Operating Result [€ bn] Margin [%] Margi
Slide 13: Operating Result Passenger Cars – EBIT Bridge
Operating Result Passenger Cars (before special items) – EBIT Bridge January to June 2021 vs. 2022 Operating result [€ bn] [€ bn] incl. Margin [%] 9.3% 10.4% -0.5 9.3 3.1 -1.5 9.3 8.5 -0.3 8.5 Volume -2.7 Mix +2.5 Price +3.3 Jan - June Jan - June Jan - June Volume / Exchange Product Fixed Jan - June
Slide 14: Volume Brand Group Performance
Volume Brand Group Performance January to June 2021 vs. 2022 Key Takeaways Volume Brand Group 1 • VW brand margin improved from 3.4% (Q1) to 7.3% in Q2, 5.6% in H1 Vehicle Sales [‘000 units] Sales Revenue [€ m] • Skoda in Q2 at 6.6% margin on par with Q1 2022; decent performance in light of Russian
Slide 15: Premium Brand Group Performance
Premium Brand Group Performance January to June 2021 vs. 2022 Key Takeaways Premium Brand Group 1, 2 • Premium brands well under way; Lamborghini and Bentley performed strong Vehicle Sales [‘000 units] Sales Revenue [€ m] • Underlying operating profit of the Audi brand continued to be solid, taking
Slide 16: Sports & Luxury Brand Group Performance
Sports & Luxury Brand Group Performance January to June 2021 vs. 2022 Key Takeaways Sports & Luxury Brand Group 1 • Porsche’s operating margin close to 20% mainly due to positive price/mix and FX effects Vehicle Sales [‘000 units] Sales Revenue [€ m] • Average price per vehicle improved to € 110,000
Slide 17: Software – CARIAD
Software – CARIAD January to June 2021 vs. 2022 Key Takeaways CARIAD • Sales revenue improved by 46% driven by license revenues with brand groups; E3 (esp. 1.1/MEB) Contracted Licenses [‘000 units] Sales Revenue [€ m] • Operating result burdened by higher development costs and personnel costs 10,466
Slide 18: Commercial Vehicles – TRATON Operations
Commercial Vehicles – TRATON Operations January to June 2021 vs. 2022 Key Takeaways TRATON Operations • Unit sales up 9%, supported by Navistar consolidation (-21% excl. Navistar) Vehicle Sales [‘000 units] Sales Revenue [€ m] • Significant impact on operating results from supply shortages and produ
Slide 19: Financial Services Division Performance
Financial Services Division Performance January to June 2021 vs. 2022 Key Takeaways Volkswagen Financial Services • Stable number of contracts and solid growth in earning assets despite supply constraints Contracts in [‘000 units] Credit Loss Ratio [in %] • Credit loss ratio remains at historically
Slide 20: China Joint Ventures Proportionate Operating Result
China Joint Ventures Proportionate Operating Result 2020, 2021 and H1 2022 Key Takeaways [€ m] • Proportionate operating result on-par FY 3,602 with prior year despite Q2 being heavily Q2 impacted by COVID related production Q1 disruptions 3,026 • Especially SVW negatively impacted in Q2 2022 as Sha
Slide 21: Volkswagen Group Outlook for 2022: Core KPIs confirmed
Volkswagen Group Outlook for 2022: Core KPIs confirmed 1 Actual Outlook 2020 2021 2022 1 Deliveries to customers 5% to 10% up on the previous year m vehicles 9.3 8.9 Sales revenue 222.9 250.2 8% to 13% higher than the prior-year figure € bn Operating return on sales 2 In the range of 7.0% to 8.5% %
Slide 22: Proof Points of our Strategy
Proof Points of our Strategy CFO Perspective Strategic CFO Targets CFO Focus Areas Focus on product transformation towards electric Focused financial steering of the transformation Digitalization: Advancing in software/services (allocation of resources to future topics) Group-wide cost & efficiency
Slide 23: Financing the Transformation: Overhead Cost Program ahead of Schedule
Financing the Transformation: Overhead Cost Program ahead of Schedule; so far allowing for compensation of Fix Cost increase despite inflation headwinds1 Group-wide Overhead Cost Program (w/o R&D, CAPEX), Deliveries to customers Plant program [in m units] (Productivity & Overhead) 11 5% - 10% Passen
Slide 24: Increase in R&D especially for Software compensated by CAPEX Discipline
Increase in R&D especially for Software compensated by CAPEX Discipline R&D / Capex – Absolute and Ratio (Automotive Division) Reducing complexity / [%, €] CAPEX R&D variances ∑ 13.3% ∑ 12.7% ∑ ~13% 1 (€ 28.3 bn) ∑ 12.2% (€ 26.1 bn) (€ 13.4 bn) Focus on synergies ~6.6% ~5.1% ~3.7% (€4.1 bn) ~5% (€ 1
Slide 25: Steering Matrix
Steering Matrix We shift the Focus towards Brand Groups and Value Drivers SCHEMATIC Strong brands Volume Premium Sports Trucks Proof points as of H1 2022: + • BEV sales significantly up Value drivers vs prior year • Ford cooperation BEV Hardware extended; MoU signed with Mahindra Software • Cariad:
Slide 26: Leading the Transformation with Integrity and Based on our Values
Overall Ambition Leading the Transformation with Integrity and Based on our Values Strong brands Financial strength BEV Integrity Software AI / mobility services 26
Slide 27: Backup
Backup 27
Slide 28: H1 Raw Materials Hedge Valuation Impact largely reversed in Q2 2022
H1 Raw Materials Hedge Valuation Impact largely reversed in Q2 2022 Raw Materials Price Development Aluminium Copper Nickel Cobalt indexed to December 31, 2021 Q1 other operating result from Q2 other operating result from Fair values of derivatives outside hedge accounting Fair values of derivatives
Slide 29: Analysis by Brand and Business Field Q1 2022
Volkswagen Group – Analysis by Brand and Business Field January to March 2022 (Q1) VEHICLE SALES (`000) SALES REVENUE (€ m) OPERATING RESULT (€ m) OPERATING MARGIN (%) Q1 2022 Q1 2021 Q1 2022 Q1 2021 Q1 2022 Q1 2021 Q1 2022 Q1 2021 Volume brand group 918 1,197 24,361 27,354 877 1,366 3.6 5.0 Volkswa
Slide 30: Analysis by Brand and Business Field Q2 2022
Volkswagen Group – Analysis by Brand and Business Field April to June 2022 (Q2) VEHICLE SALES (`000) SALES REVENUE (€ m) OPERATING RESULT (€ m) OPERATING MARGIN (%) Q2 2022 Q2 2021 Q2 2022 Q2 2021 Q2 2022 Q2 2021 Q2 2022 Q2 2021 Volume brand group 1,038 1,191 28,649 27,992 1,769 1,508 6.2 5.4 Volksw
Slide 31: Analysis by Brand and Business Field H1 2022
Volkswagen Group – Analysis by Brand and Business Field January to June 2022 (H1) VEHICLE SALES (`000) SALES REVENUE (€ m) OPERATING RESULT (€ m) OPERATING MARGIN (%) H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 Volume brand group 1,956 2,388 53,010 55,346 2,646 2,874 5.0 5.2 Volk
Slide 32: Automotive Division – Net Cash Flow
Automotive Division – Net Cash Flow 1 January to June 2022 [€ bn] 5.8 2.6 0.9 2.3 Reported net cash flow Diesel outflow Aquisition and disposal Clean net cash flow of equity investments 1 Including allocation of consolidation adjustments between Automotive and Financial Services divisions 32
Slide 33: Continued resilient Operating Performance
Continued resilient Operating Performance Development of Sales, Operating Result and Margin Underlying Operating Result 1, 2 [€ bn] Q1 2022 Q2 2022 H1 2022 Reported operating profit 1 13.2 0.9 Fair value derivatives 12.3 outside hedge accounting Underlying operating profit 1 8.5 3.2 7.1 5.3 4.7 -2.4
Slide 34: Financial Strength of Automotive Division
Financial Strength of Automotive Division Resilience further enhanced Balance Sheet Automotive Division [€ bn] 31 Dec 2019 31 Dec 2021 30 June 2022 286.7 271.9 Equity and equity ratio 246.8 Provisions for pensions 126.0 109.0 Other liabilities 92.8 44% 40% 38% 40.8 27.2 40.6 Goodwill 1 [€ bn] 23.2 2
Slide 35: What is in our Guidance?
What is in our Guidance? Elements already included in GUIDANCE for What is not covered by our GUIDANCE 2022 for the operating profit • A resurgence of the COVID-19-Pandemic situation • Favorable Price and Mix continue to support operating results • The guidance presented is also subject to the furth