Rheinmetall Ag · XETR:RHM
Rheinmetall — Investor Presentation (March 2021)
84 slides from Rheinmetall's investor presentation, March 2021
Slide 1: Rheinmetall Group Corporate Presentation March 2021
Rheinmetall Group Corporate Presentation March 2021
Slide 2: Mobility and security form the DNA of the business model
Rheinmetall Group Mobility and security form the DNA of the business model RHEINMETALL GROUP INTEGRATED TECHNOLOGY GROUP FOR SECURITY AND MOBILITY Automotive Our heart beats for your engine Defence Force protection is our mission Tier 1 supplier System house for land based operations Business Mo
Slide 3: Highlights
Rheinmetall Group Highlights Group performance indicator Strategy roadmap Grow sales ~8% op. Organic International around 8% margin RHEINMETALL growth expansion Targeted 2-4% Cash on sales 30-35% payout ratio GROUP Leading by innovations Targeted acquisitions AUTOMOTIVE Our heart beats for your engi
Slide 4: Financial overview - Growth in all relevant KPI
Rheinmetall Group Financial overview - Growth in all relevant KPI Sales, operating result and operating margin Operating FCF and operating FCF to Sales In €m In €m / in % 4,7% 5,0% 6.500 6.255 12 400 5 6.148 314 3,7% 5.896 5.875 10 300 276 4 2-4% 6.000 5.602 8 217 3 OFCF 200 161 5.500 5.183 8,0% 8,1
Slide 5: Rheinmetall Automotive Products per division
Rheinmetall Automotive Products per division MECHATRONICS HARDPARTS AFTERMARKET PUMP TECHNOLOGY SMALL BORE PISTONS HARDPARTS AUTOMOTOVE EMISSION SYSTEMS BEARINGS MECHATRONICS SOLENOID VALVES LARGE BORE PISTONS COMMERCIAL DIESEL SYSTEMS CASTINGS ACTUATORS Corporate Presentation March 2021 5
Slide 6: Rheinmetall Defence Products per division
Rheinmetall Defence Products per division WEAPON AND ELECTRONIC VEHICLE AMMUNITION SOLUTIONS SYSTEMS HX-FAMILY MID & LARGE CALIBER AMMO INTEGRATED ELECTRONIC SYSTEMS TACTICAL VEHICLES MID & LARGE CALIBER WEAPONS AIR DEFENCE & RADAR SYSTEMS LOGISTIC VEHICLES TECHNICAL PUBLICATIONS Medium wheeled Medi
Slide 7: One Rheinmetall
One Rheinmetall Realization of growth in changing market conditions Positioning as integrated technology group for Mobility and Security Realization of growth potentials in changing market environments ONE Leveraging strengths by bundling and channeling our expertise and RHEINMETALL competenci
Slide 8: Strategy Update
STRATEGY UPDATE Taking Rheinmetall to the next level Corporate Presentation March 2021 8
Slide 9: Management sets clear strategic objectives
Strategy update Management sets clear strategic objectives 1 Reduce Automotive exposure 2 Minimum profitability level requirement 3 Continuous portfolio management Corporate Presentation March 2021 9
Slide 10: Transformation process initiated
Strategy update Transformation process initiated Realignment Integration of of existing business Automotive holding • Disposal process of the piston business • Right-size the structure to support the business • Regrouping of business activities • Eliminate redundant functions on • Focused approach w
Slide 11: The new corporate structure
Strategy update The new corporate structure 2020 2021 Rheinmetall Group Rheinmetall Rheinmetall Group Group Holding Holding Automotive Weapon and Electronic Vehicle Sensors and Materials Defence Pistons Holding Ammunition Solutions Systems Actuators and Trade Non-core business Weapon & Ammunition Me
Slide 12: Strong measures to improve the Automotive situation
Strategy update Strong measures to improve the Automotive situation Pistons decided non-core Realignment of the core business Superb engineering and business production capabilities form our innovation culture Find a better owner for Right-sizing the organization Leveraging of technologies the pisto
Slide 13: Sensors and Actuators: Focus on profitable growth
Strategy update Sensors and Actuators: Focus on profitable growth IHS Sensors and Historic performance (2015-2019) LV production* Actuators In million units Sales In € billion • Sales growth of 1.3% CAGR vs. flat global LV volumes growth* +5.4% CAGR +10% CAGR • 9.3% average operating margin 95 ~2.0
Slide 14: Sensors and Actuators: Three pillars of growth
Strategy update Sensors and Actuators: Three pillars of growth Innovative solutions for Growth in alternative Diversify into clean mobility powertrains (AP) new applications Tighter Regulation of fuel fumes Electrified Mobility Sustainability and Performance Electronic Vapor Pump (EVAP) Thermal Mana
Slide 15: Sensors and Actuators: China JV clearly outperform market
Strategy update Sensors and Actuators: China JV clearly outperfom market IHS LV production* China JV (100% pro forma sales ) In million units; CAGR 2020-25 In € million; CAGR 2020-25 BEV Strong profitable growth of at equity Hybrid consolidated sales ICE +4.7% 29.4 ~400 • Introduction of fuel fume r
Slide 16: Materials and Trade: Well positioned to capture opportunities
Strategy update Materials and Trade: Well positioned to capture opportunities Aftermarket Bearings Castings (Joint Ventures) Solid profitability Shift to non-ICE applications Technology leadership 5% CAGR 7% CAGR 7% CAGR ~440 ~300 ~1,100 ~340 ~800 ~200 2020e 2025p 2020e 2025p 2020e 2025p Flexible
Slide 17: Defence budgets demonstrate robustness despite Covid
Strategy update 2021 Defence budgets demonstrate robustness despite Covid 2022 2023 Germany Australia UK* Hungary USA Stable Growing Growing Growing Stable Threat scenario • Russia and China defence Tender • Large vehicle programmes with persists spending increased at 10% ongoing temporary delays, b
Slide 18: Competitive vehicles portfolio offers huge potential
Strategy update Competitive vehicles portfolio offers huge potential Infantry Main Wheeled Trucks fighting vehicles battle tanks vehicles • Puma • Leopard • 4x4 HU JV • HX-Family • Lynx • Challenger • 6x6 New Fox • Future trucks • MGCS • 8x8 Boxer ~€15 ̶ 40 bn ~€5 bn ~€5 ̶ 6 bn ~€7 ̶ 8 bn 10 years‘
Slide 19: Hungary is a catalyst for our Lynx pipeline
Strategy update Hungary is a catalyst for our Lynx pipeline Australia Eastern Europe USA US Army Bradley replacement ~4000 vehicles ~ € 40 bn Slovakia and Tender: 2021-2023 Slovenia Czech Land 400 Phase III Start of Tender: Potential start of ~450 vehicles production: 2028 2024/25 Hungary ~200 veh
Slide 20: Vehicle Systems main driver for mid-term growth
Strategy update Vehicle Systems main driver for mid-term growth 2020e Sales 2025 Targeted Sales ~€ 5.5 bn 27 % ~€ 3.7 bn Weapon & Ammunition 30 % 22 % Electronic Solutions 23 % Vehicle Systems 51 % 47 % % share based on unconsolidated Corporate sales distribution Presentation March 2021 20
Slide 21: Stronger focus on Defence with ICE exposure below 20%
Strategy update Stronger focus on Defence with ICE exposure below 20% 2020e Sales 2025 Targeted Sales ~30% ICE exposure ~37% Non ICE ~9% ~15-20% ~€5.9 bn ~€8.5 bn ~10-15% ~28 Non ICE ICE % and new applications ~63% ~70% Defence exposure Defence exposure ICE = Internal Combustion Engine Corporate Pre
Slide 22: Commitment to our technological leadership
Strategy update Commitment to our technological leadership ONE Rheinmetall Passion for technology Re-organization to Leverage our core Focus on growth better fit our needs technological strengths business areas • Divest non-core business • Further integrate technologies • Continue our successful Def
Slide 23: Upgrading our financial targets for 2025
Strategy update Upgrading our financial targets for 2025 Attractive growth profile Higher profitability Focus on free cash flow Sales target Margin target Cash to sales target* ~ € 8.5 bn ≥ 10% ~ 3-5% Passion for Performance Corporate *OFCF to Presentation March 2021 sales ratio 23
Slide 24: Automotive
AUTOMOTIVE A changing world 24
Slide 25: Automotive: Leading technology and market positions
Automotive Leading technology and market positions Key Figures 2020 Sales by division* Sales by region Sales Total Management View Sales: €2.2bn Aftermarket Hardparts Asia 5% RoW China JV-Sales 15% in €bn 31% 18% 0.9 Op. result: €33m USMCA 17% Europe w/o 2.2 Op. margin: 1.5% 54% 18% Consolidated Mec
Slide 26: Automotive: Leading technology and market positions
Automotive Leading technology and market positions Sales driver Segment Structure Key Competitor Differentiator Hardparts Hardparts Strong brand Megatrend mobility Pistons Mahle, Nemak, GGB, Growing demand for Castings Tenneco (Federal Global footprint Bearings Mogul), Dong Yang Stro
Slide 27: Product portfolio by division and engine type
Automotive overview Product portfolio by division and engine type VACUUM PUMPS EXHAUST CONTROL FUEL TANK ISOLATION THERMAL MANAGEMENT HRB eCATHODE VALVE MECHATRONICS VALVE VALVE GEN. 3 ELECTRICAL COOLANT GASOLINE EGR HIGH-VOLTAGE E-MOTOR COOLING EGR MODULE SC AIR SYSTEM eWastegate PUMP COOLANT PUMP
Slide 28: Rising global fleet and regulatory restrictions support growth
Drivers for growth Rising global fleet and regulatory restrictions are supporting our growth LV production forecast* Further regulatory pressure*** Automotive sales distribution [mUnits] +7% by engine type** +29% 102 CO2 NOx -17% 95 in g/km in mg/km 89 Core Diesel 13% 20% 4% 2% -24% -56% Other
Slide 29: Automotive Market trends
Automotive Market trends The growth drivers remain strong NT E 3+ Efficiency (CO2 Reduction) Emission (Reduction) Electrification Outside powertrain The innovation pipeline is packed! Corporate Presentation March 2021 29
Slide 30: CO2 reduction with Automotive products
Efficiency CO2 - reduction with Automotive products – gasoline engine vehicle 130 g 95 g CO2/km CO2/km 2015 2021 -1 g -3 g -3 g -7 g -2 g -2 g CO2/km CO2/km CO2/km CO2/km CO2/km CO2/km Variable Tribology Electr. control Variable Electr. Lightweight oil pump system valve and variable valve train EGR
Slide 31: Electrification
Electrification Rheinmetall Automotive products Corporate Presentation March 2021 31
Slide 32: Micro Mobility
Micro Mobility Starting with competitive product into a booming market High growth market Unique selling proposition European market with 10% CAGR between 2018 and Smooth phasing of engine support 2030 Excellent freewheeling High market concentration with Bosch representing Low weight and
Slide 33: Diversification: Increasing portfolio for non-LV applications
Diversification Increasing portfolio for non-LV applications Trucks Large bore pistons Bearings & Aftermarket continuous casting Diverse portfolio for E.g. ship and locomotive truck applications pistons Sanitary application Global supply of spare parts Corporate Presentation March 2021 33
Slide 34: Trucks: Diverse portfolio for truck applications
Trucks Diverse portfolio for truck applications Permaglide bearings for truck compressors and truck hydraulics Main coolant pumps Aluminum pistons Auxiliary coolant pumps Steel pistons Electrical oil pumps Piston rings Cooperation with Riken Bushings for injection pumps Main-bearings Sales Connectin
Slide 35: Automotive China: China growth story
Automotive China China growth story Highlights Sales China in €m CAGR +13% Partner of local big players SAIC and HASCO (50/50 1,149 1,051 WFOEs 972 1,003 joint ventures) 871 934 681 Biggest casting capacities in China – technology leader 528 401 JVs (100%) Regulation (China 6) – provides sub
Slide 36: Defence
DEFENCE Managing the “super cycle” 36
Slide 37: Defence: Leading supplier with increasing international presence
Defence Leading supplier with an increasing international presence Key Figures 2020 Sales by division* Sales by region Order backlog by region Row Row Sales: €3.7bn Weapon and Asia / ME Asia / ME Germany 1% Ammunition 16% 5% North America 18% Vehicle 30% North America 4% 2% 13% Op. result: €414m Sys
Slide 38: Defence: Leading technology and market position
Defence Leading technology and market position Sales driver Structure of Corporate Segments Key Competitor Differentiator Increasing demand Vehicle Systems Vehicle Systems Reputation as trustful and for security Tactical Vehicles General Dynamics, reliable company Logistic Vehicles BAE, KNDS
Slide 39: Defence: Managing the super cycle
Defence Managing the super cycle Demand for next generation 1990 Upscaling of systems forces and Downscaling Inflection modernization Return to treaty of forces and point and territorial armament NATO Out of area defence missions 2% target 2014 Annexation committment Crimea Corporate Presentation Ma
Slide 40: Our home markets
Defence super cycle Successful internationalization provides diverse sources of growth Our home markets Germany Australia United Eastern Kingdom Europe Largest customer Established „home JV with BAE serves Modernization to Budget increase: market“ „home market“ NATO standards Commitment to
Slide 41: Defence tender overview
Defence tender overview High demand could lead to promising super cycle UK Eastern Europe MIV Boxer Lithuania: Boxer Challenger Poland: Leopard II Hungary: Leopard, Howitzer, France Lynx, Trucks IFV(wheeled) MGCS Czech Rep: IFV (tracked) Germany Slovakia: IFV USA Trucks Bulgaria: IFV (wheeled) Ammun
Slide 42: German defence: NATO commitment key driver
German defence NATO commitment key driver for German demand Lead role in Very High Readiness Joint Task Force ( VJTF) Bundeswehr ‘19 ‘23 ‘27 ‘31 ’32+ 2016 White paper 04/2018 VJTF´23 1x Division 3x Division 3x Division Concept VJTF´19 (1 Brigade) (3x Brigade) (8x Brigade) (10x Brigade) Bundeswehr 09
Slide 43: German defence budget
German defence budget Investment expenses and Rheinmetall-share - budgets become sizeable in €m 9253 8908 8263 Drivers for budget increase: More personnel, return to ~200.000 soldiers 6063 5894 More equipment (100% equipment 5327 5323 level) 4890 More finance, investive share increased by 14%
Slide 44: German Defence: Additional structural demand
German Defence Additional structural demand of German armed forces Vehicles Fox Boxer Trucks Puma Leopard 2 (>500 vehicles) (~150 vehicles) (>10.000 vehicles) (~250 vehicles) (>200 vehicles) Programs and ammunition NNBS TLVS/Next Gen. Patriot DLBO TEN Ammunition Military Camps (Short range air defen
Slide 45: Australia: Successful establishment of a new home market
Australia Successful establishment of a new “home market” 2020 MilVehCoE Military Vehicle 2018 Center of Excellence Land 17: 155mm Munition Framework Contract: 2017 EUR 60m p.a. Supashock 2018-2023 49% Rheinmetall „Brain-Trust“ 2022/2023 T 2017 LYNX 2018 Land 400 Phase 3 JV Rheinmetall NIOA
Slide 46: United Kingdom - Joint Venture with BAE
United Kingdom - Joint Venture with BAE Creating a new “home market” and strengthening our position LEGACY BUSINESS EXPANSION OF PRODUCT PORTFOLIO BAE UK business Future Armoured engineering vehicles and Boxer Mechanized Infantry Vehicle (MIV) bridge-laying tanks - 500 vehicles @ € 1.4bn + A
Slide 47: System house for land based operations
System house for land based operations Integrating components to systems VJTF System-of-Systems System house Systems Armored Infantryman Puma Gladius Platforms Key Components Lance turret Protection Ammunition Laser opto-sensoric Corporate Presentation March 2021 47
Slide 48: Financials
FINANCIALS Corporate Presentation March 2021 48
Slide 49: FY 2020 Highlights: Group
FY 2020 Highlights: Group Solid financial performance under difficult circumstances €217 m operating free cash flow €2.00 dividend proposal to the AGM Record order backlog of €13.4 bn Corona crisis well managed Transformation process initiated Corporate Presentation March 2021 49
Slide 50: FY 2020 Highlights: Automotive
FY 2020 Highlights: Automotive Crisis well managed in €m Order Intake* Booked business** Sales -21.3% -25.1% -21.4% 2,705 2,130 3,627 2,717 2,736 2,151 2019 2020 2019 2020 2019 2020 Operating Result Operating Margin Operating Free Cash Flow -82.2% -520bp -75.3% 184 6.7% 73 33 1.5% 18 2019 2020 2019
Slide 51: FY 2020 Highlights: Defence
FY 2020 Highlights: Defence Very successful 2020 laid base for a bright future in €m Order intake Order backlog Sales +23.2% +24.5% +5.7% 5,186 6,387 10,399 12,942 3,522 3,723 2019 2020 2019 2020 2019 2020 Operating Result Operating Margin Operating Free Cash Flow +20.6% +130bp -34.6% 343 414 9.8% 1
Slide 52: FY 2020 Group: EPS and dividend
FY 2020 Group: EPS and dividend Progressive dividend proposal underpins management confidence Earnings and dividend per share in € -24% Payout -108% 34,2% ratio in % 8 35 30,9% 29,6% 7 -17% 30 Progressive dividend proposal despite EPS 6 25 reduction due to operational decline in 5 Automotive and
Slide 53: FY 2020 Group: Highlights
FY 2020 Group: Highlights Strong Defence performance mitigated Covid-impact in Automotive Sales Operating result in €m in €m Margin in % -15.6% -6.1% 505 -344 -87 50 -82 426 1 2 -337 6,255 -5.5% -1.4% +0.8% 8.1% -16.3% +0.2% +0.4% 7.3% 5,875 89 FY Operational FX M&A FY FY Operational FX M&A FY S
Slide 54: FY 2020 Group: Operating free cash flow
FY 2020 Group: Operating free cash flow Q4 performance raised cash to sales ratio above targeted corridor Operating free cash flow bridge in €m 5.0 %* 3.7%* -97 Special items of €337m in EAT in combination -27 with lower Automotive operational performance 51 314 -353 -150 104 D&A included impa
Slide 55: FY 2020 Group: Group key financials
FY 2020 Group: Group key financials Balance sheet provides for high flexibility Equity and Equity ratio Equity ratio Gross debt and maturity profile in €m and % Total equity in €m 3,000 40 Ʃ 1,023 32.1 30.6 28.2 2,000 Leasing & Other 260 2021 2022 2023 2024 2025 2026ff. 20 Bank loans 110 1,000 2
Slide 56: FY 2020 Group: Capex
FY 2020 Group: Capex Capex on guided lower level Automotive Defence in €m and in (% of sales) in €m and in (% of sales) (5.2%) (4.4%) (4.7%) (5.4%) -34% +21% 143 201 11 17 166 65 95 54 10 9 38 23 115 76 99 (2.2%) 89 2019 2020 2019 2020 IFRS 16 (non-cash) Capitalized development costs Capital exp
Slide 57: FY 2020 Group: R&D
FY 2020 Group: R&D Innovation remains essential for both businesses Automotive Defence in €m and in (% of sales) in €m and in (% of sales) (7.7%) (8.9%) (4.1%) (4.8%) 210 29 192 21 17 9 180 145 53 47 38 163 162 23 (6.0%) (7.5%) 89 75 (2.1%) (2.4%) 2019 2020 2019 2020 Customer-financed R&D Capita
Slide 58: Q4 2020 Automotive: Highlights
Q4 2020 Automotive: Highlights Strong finish with further margin recovery and improved cash generation Quarterly sales and margin development Comments on quarterly performance In €m and % 7.2 Operational sales growth of 1.7% in line with regionally 6.2 5.1 1.7 adjusted IHS growth* of 1.8% -15.3
Slide 59: Q4 2020 Automotive: Sustained cost discipline and recovering volumes
Q4 2020 Automotive: Highlights Sustained cost discipline and recovering volumes supported Q4 Monthly sales growth vs. IHS LV-production growth Automotive in % Y-o-Y IHS LV Production growth (ex China) Q1 Q2 Q3 Q4 20 1 -3 -3 -4 2 0 -8 -4 -6 -6 -15 -16 -8 -4 -6 -26 -33 -18 -18 -29 -36 -20 -68 -61 -7
Slide 60: Q4 2020 Automotive: Divisional highlights
Q4 2020 Automotive: Divisional highlights Sales held back by FX, but strong margin recovery Sales Automotive Operating result Automotive in €m in €m Mechatronics Margin Margin • Cost reductions and recovering Q4 2019 Q4 2020 -2% +13% volumes remained supportive 637 623 6.2% 7.2% 45 Hardparts • W
Slide 61: Q4 2020 Automotive: China performance
Q4 2020 Automotive: China performance Business materially lagged the Chinese recovery Sales* Comments on the quarter in €m -5.9% Sales declined 6% due to lost volumes which could 330 -14 -5 311 not be compensated in a growing Chinese market 288 (6.2%; IHS Markit March 2021) 272 Negative FX-e
Slide 62: Q4 2020 Automotive: Endmarkets
Q4 2020 Automotive: Endmarkets Non-LV business had a stabilizing effect on FX-burdened Q4 sales Sales split LV/ Non-LV Sales split Non-LV in €m / in % in €m / in % Delta absolute in % -2.4% Diesel +9 +6.4% 638 Gazoline -29 -11.7% 623 +1.3% Other LV +2 +5.8% 140 149 215 218 LV Business -18 -4.2%
Slide 63: Q4 2020 Automotive: Innovation
Q4 2020 Automotive: Innovation Hydrogen recirculation blower Enhancing efficiency and improve cold start behavior by recycling non-used hydrogen in fuel cells First order on award winning innovation Cooperation with Daimler to boost technical advances in fuel cell-powered heavy commercial vehicles f
Slide 64: Q4 2020 Defence: Highlights
Q4 2020 Defence: Highlights Expansion of operating margin and strong order intake Quarterly sales and margin development Comments on quarterly performance In €m and % 1,273 Hungarian orders propelled order intake by 48% 1,324 Q4 sales declined FX adjusted by -2.6% in line with expectations 15.8
Slide 65: Q4 2020 Defence: Divisional highlights
Q4 2020 Defence: Divisional highlights Weapon and Ammunition with excellent performance in Q4 Sales Defence Operating result Defence in €m in €m Margin Margin Q4 2019 Q4 2020 Weapon and Ammunition -4% +3% • Best Q4 ever driven by national 1,324 217 and international demand 1,273 15.8% 17.0% 210
Slide 66: Q4 2020 Defence: Order overview
Q4 2020 Defence: Order overview Hungarian Lynx order in Q4 lifted backlog to new record high Order intake by division Order backlog profile in €m in €bn Weapon and Ammunition +48% Electronic Solutions Additional „Shadow backlog“ of ~€3.6bn including truck and 4,427 Vehicle Systems ammunition fra
Slide 67: FY 2020 Defence: Regional overview
FY 2020 Defence: Regional overview Strong European focus, but more diversified Order intake by region Order backlog by region Sales by region in % and totals in €bn in % and totals in €bn in % and totals in €bn +23% +24% +6% 6.4 12.9 3.7 2% 1% 3.5 5% 8% 13% 7% 5.2 1% 3% 10.4 2% 16% 3% 3% 17% 8
Slide 68: FY 2020 Defence: Service business
FY 2020 Defence: Service business Increasing platform sales support service business growth Service sales 1X SALES OF PLATFORM in €m +10% 536 487 2X LIFECYCLE SPENDINGS Rheinmetall creates 2019 2020 additional business opportunities over the Service business increased y-o-y by 10% entire life cy
Slide 69: Outlook 2021
OUTLOOK 2021 Corporate Presentation March 2021 69
Slide 70: Outlook: Favorable business environment for 2021
Outlook Favorable business environment for 2021 +6% • Global economies return to growth mode Global GDP Growth1 +13% • LV production volume recovery Global LV volumes2 +6% • Growing defence budgets in our Home markets Home markets budget growth3 1 OECD, March interim Economic Outlook Forecasts March
Slide 71: Outlook: Structural cost savings initiated
Outlook Structural cost savings initiated Structural cost-savings overcompensate temporary effects from short-time allowance in €m ~40 ~30 Total of €40m restructuring provisions already booked in Q3 2020 ~20 Total 2020 short term allowance accounted for just above €30m First effect from rest
Slide 72: Outlook: Major programs start contributing from 2022
Outlook Major programs start contributing from 2022 onwards 1. Lot Puma (Ger) Challenger (UK) MIV (UK) Lynx (HU) Ammunition (HU) Puma S1 upgrade (Ger) L400 Ph2 (AU) 2019 2020 2021 2022 2023 2024 2025 Under contract Order potential Corporate Presentation March 2021 72
Slide 73: Outlook: Group guidance 2021
Outlook Group guidance 2021 Operational Sales Growth Operating Margin 7-9 % 8-9 % (2020: €5.875 m) (2020: 7.3%) Group guidance includes sales and operating results of the non-core Piston business unit for the full year. This scenario is based on the assumption that potential production losses result
Slide 74: Rheinmetall Guidance 2021 by division
Outlook Rheinmetall Guidance 2021 by division in the new reporting structure 2020 Outlook 2021e 1,2 Proforma Weapon and Sales €1,196m Notably improved sales Ammunition Margin 15.5% Slightly above previous year level Electronic Solutions Sales €935m Slightly improved sales Margin 9.8% On previous yea
Slide 75: Select key data: Outlook 2021
Select key data: Outlook 2021 Rheinmetall Group 2020 2021 Holding cost (new) -€21m (-€43m) €50m-€60m Tax rate Adjusted 26% Comparable level Interest result -€33m ~-€40m Capex (excl. IFRS 16) 5.4% (3.7%) around 6% D&A (excl. impairment) 9.5% (4.6%) 4% - 5% R&D (self-funded) 6.3% (5.1%) Comparable lev
Slide 76: Appendix
Appendix Corporate Presentation March 2021 76
Slide 77: Sustainability: Path to CO2 neutrality already started
Sustainability Path to CO2 neutrality already started 2023 Report according to 2040 Carbon Disclosure CO² neutral Project Standards 2020 - 2040 2021 Milestone plan Reporting CO2 neutrality 2020 analogous to 3 years Report according to UN Global increments Global Reporting Compact Initiative 2022 201
Slide 78: FY 2020 Group: ESG
FY 2020 Group: ESG ESG forms part of our corporate strategy Environment Social Governance 2035: CO² neutral* Responsible corporate Strict compliance citizen organization • Over next 2 years reduction of • Employee health & safety • Robust governance with strict water consumption use by 10% • Transpa
Slide 79: Our capital allocation policy is geared towards further growth
Our capital allocation policy is geared towards further growth Funding of growth (organic and M&A) 9.4% Dividend to shareholders (Payout ratio 30-35%) Q3 ‘19 level Improvement of pension funding via CTA (target 50-60%) level Corporate Presentation March 2021 79
Slide 80: Group 2016 – 2020: Key figures (as reported)
Group 2016 – 2020: Key figures (as reported) in €m 2016 2017 2018 2019 2020 Balance Sheet Total assets 6.150 6.101 6.759 7.415 7.267 Shareholder's equity 1.781 1.870 2.173 2.272 2.053 Equity ratio (in %) 29,0 30,7 32,1 30,6 28,2 Pension liabilities 1.186 1.080 972 1.169 1.177 Net financial debt 19 2
Slide 81: Segments 2016 – 2020: Key figures
Segments 2016 – 2020: Key figures Automotive Defence 2016 2017 2018 2019 2020 in €m 2016 2017 2018 2019 2020 2.670 2.922 2.888 2.705 2.130 Order intake 3.050 2.963 5.565 5.186 6.387 458 520 478 447 426 Order backlog (Dec. 31) 6.656 6.416 8.577 10.399 12.942 2.656 2.861 2.930 2.736 2.151 Sales 2.946
Slide 82: Continuing ROCE improvement
Continuing ROCE improvement ROCE in % 25 22,2 20,2 19,6 20 19,0 18,8 18,7 16,7 17,1 15,9 15,4 15 13,4 13,1 12,3 11,8 10,7 10,6 9,8 10 10% 6,1 Group 4,7 3,9 5 2,7 0,3 0 -4,6 -25 -23,1 2013 2014 2015 2016 2017 2018 2019 2020 Group Defence Automotive Corporate Presentation March 2021 82
Slide 83: Next events and IR contacts
Next events and IR contacts Next Events IR Contacts M.M. Warburg, Roadshow Germany 26 March 2021 Dirk Winkels Goldman Sachs, European Small and Mid Cap Conference All investor 07 May 2021 Head of Investor Relations meetings will be Tel: +49-211 473-4749 UBS, Pan European Small and Mid Cap Confer
Slide 84: Disclaimer
Disclaimer This presentation contains “forward-looking statements” within the meaning of the US Private Securities Litigation Reform Act of 1995 with respect to Rheinmetall’s financial condition, results of operations and businesses and certain of Rheinmetall’s plans and objectives. These forward-lo