Nemak SAB de CV · BMV:NEMAK/A

Nemak SAB de CV — Investor Presentation (March 2019)

29 slides from Nemak SAB de CV's investor presentation, March 2019

  1. Slide 1: Investor Presentation

    Investor Presentation March 2019 Innovative Lightweighting

  2. Slide 2: Forward-looking statement

    Forward-looking statement This presentation contains forward-looking information based on numerous variables and assumptions that are inherently uncertain. They involve judgments with respect to, among other things, future economic, competitive and financial market conditions and future business dec

  3. Slide 3: Nemak Overview

    Nemak Overview ©Nemak | Internal

  4. Slide 4: Nemak Today

    Nemak Today Leading provider of innovative lightweighting solutions 2018 Revenues 2018 EBITDA1 US $4.7 Billion US $734 Million Diversified product portfolio Sole supplier in ~90% of sales Strong customer base Presence in ~650 vehicle platforms 1 in 4 new vehicles sold has a Nemak component (1) = EBI

  5. Slide 5: Broad portfolio of automotive lightweighting solutions

    Broad portfolio of automotive lightweighting solutions Cylinder Heads Engine Blocks Longitudinal Members Transmission Cases E-Motor Housings Battery Housings ©Nemak | Internal 5

  6. Slide 6: State-of-the-art facilities in major automotive markets

    State-of-the-art facilities in major automotive markets Slovakia Russia 38 Manufacturing facilities 16 Countries Spain ~23K Employees ©Nemak | Internal 6

  7. Slide 7: Solid and long-standing customer relationships

    Solid and long-standing customer relationships 40 years 25 years 20 years 15 years 10 years 35 years 25 years 20 years 15 years 10 years 35 years 20 years 20 years 15 years 10 years 2 years ©Nemak | Internal 7

  8. Slide 8: Strong competitive position

    Strong competitive position Product Customer portfolio Others Cylinder heads 5% 3% 3% 3% 29% Engine blocks 5% 6% Transmissions 12% components 21% Structural & EV 13% components ©Nemak | Internal 8

  9. Slide 9: Financial Overview

    Financial Overview ©Nemak | Internal

  10. Slide 10: Recent Developments & Results

    Recent Developments & Results ©Nemak | Internal 10

  11. Slide 11: 2018 Highlights

    2018 Highlights Solid financial performance Mixed industry developments • EBITDA 5% above guidance • Positive North America performance • Net Debt to EBITDA at 1.7x • Europe volumes affected by diesel & WLTP1 Structural & EV components Others business • USMCA discussion concluded • Strong order inta

  12. Slide 12: 2018 Financial highlights

    2018 Financial highlights Revenue by Region Δ vs. Δ vs. RoW Actual 9% Guidance 2017 Sales (US$ B) 4.7 4.5% 5.0% Volume (M Units) 50.0 (0.2)% 0.2% North America Europe 56% EBITDA (US$ M) 734 4.9% 2.7% 35% EBITDA / Pc (US$) 14.7 0.7 0.4 CAPEX (US$ M) 403 17 (30) ©Nemak | Internal 12

  13. Slide 13: Long-term debt

    Long-term debt Currency Distribution Amortization Schedule Others (US$ M, Dec ‘18) 5% Average Life 5.31 years 656 EUR, USD, 581 51% 44% 572 500 Rate Distribution Variable 123 18% 44 26 32 18 84 81 19 20 21 22 23 24 25 Bank Debt Long Term Bonds Fixed 82% ©Nemak | Internal 13

  14. Slide 14: Financial performance

    Financial performance Net Debt (US$ M) Capex (US$ M) 541 1,315 1,261 1,271 1,252 460 1,210 445 433 403 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Net Debt to EBITDA Dividends (Times) (US$ M) 169 171 1.9 1.8 1.7 1.6 1.6 92 80 60 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 ©Nemak | Intern

  15. Slide 15: 2019 Guidance

    2019 Guidance ©Nemak | Internal 15

  16. Slide 16: 2019 Guidance considerations

    2019 Guidance considerations Challenges Opportunities • North American auto industry • Ramp-up of structural & EV • European emissions testing & diesel components business growth reduction • Strong pipeline of SC/EV prospects (~US$1.8 B) • Ford performance in China • Growth in South America • Cost &

  17. Slide 17: 2019 Guidance

    2019 Guidance 2019 % vs. 2018 Volume (M Eq. Units) 46.0 -8% Sales (US$ B) 4.4 -6% EBITDA (US$ M) 620 -16% CAPEX (US$ M) 320 -83M Net Debt (US$ M) 1,240 -1% ©Nemak | Internal 17

  18. Slide 18: 2025 Strategy Update

    2025 Strategy Update ©Nemak | Internal

  19. Slide 19: Industry trends

    Industry trends Emission regulations • Stricter emissions control Propulsion • Faster adoption in electrification • Longer product life cycle in internal combustion engines Vehicle structures • Mix of lighter materials in vehicle structure ©Nemak | Internal 19

  20. Slide 20: Environmental regulations

    Environmental regulations Fuel Economy Regulations Miles per gallon(1) 70 65 Targets: • Efficiency and emission regulations in major 60  EU 2025: 67.6  US 2025: 38.0(2) automotive markets 55  China 2020: 47.7  Stricter MPG and CO2 targets for ’20 – ‘25 50 45 40 • Main driver for combustion engin

  21. Slide 21: Propulsion evolution

    Propulsion evolution Global Vehicle Production • Global production of 20 M hybrids & battery electrics (M Units) by 2025 101 105 96 3 8 Battery electrics 1 • Technological innovation supports combustion 3 7 12 Hybrids engine usage  Engine enhancements  Hybrids (combustion engine & e-motor) 92 91 C

  22. Slide 22: Business segments

    Business segments Combustion Engine Structural & EV Components • Operational efficiencies • Greater margins & value added • Maximize cash flow • New competencies • Capacity utilization  Assembly  Volume consolidation  Design engineering ©Nemak | Internal 22

  23. Slide 23: Market potential of ~US$11 B by 2025

    Market potential of ~US$11 B by 2025 • Focus on battery housings, e-motor housings & structural components Market 2025 (1) Products Solutions (US$B) Structural Components 3.5 Aluminum Casting Hybrids 1.3 Battery Aluminum Casting & Electrics Assemblies 6.0 (1) Considers North America, Europe, and Chi

  24. Slide 24: Solid development in new business avenues

    Solid development in new business avenues • Awarded business to-date for ~US$600 M in structural & EV components  Quotation pipeline amounts to ~US$1.8 B Successful product launches State-of-the-art solutions Assembly and secondary ops. ©Nemak | Internal 24

  25. Slide 25: Awarded SC/EV business for high-performance applications…

    Awarded SC/EV business for high-performance applications… Mercedes-Benz BMW iNext BMW i8 GLE Hybrid Jaguar I-Pace AMG SL232 BMW i4 ©Nemak | Internal 27

  26. Slide 26: …Awarded SC/EV business for high-performance applications

    …Awarded SC/EV business for high-performance applications Volvo Polestar Porsche Taycan Mercedes-Benz EQS BMW X5 Jeep Wrangler BMW i3 Hybrid ©Nemak | Internal 26

  27. Slide 27: Increasing Nemak content per vehicle

    Increasing Nemak content per vehicle Combustion Engine Hybrid Battery Electric US$450 – 500 US$480 – 580 US$550 – 700 Heads, Blocks & Trans Heads & Blocks E-Motor Housings Structural Components Structural Components Structural Components Battery Housings Battery Housings Hybrid Trans Other EV Compon

  28. Slide 28: Key takeaways

    Key takeaways Positioned to capitalize on secular industry trends Profitable combustion engine business drives cash flow generation Electrification & lightweighting represent a major growth opportunity New business backlog of ~US$1.6 B in terms of annual revenues Pursuing sales prospects in SC/EV wo

  29. Slide 29: Nemak Innovative Lightweighting

    6 Nemak Innovative Lightweighting

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