Autoliv, Inc. · NYSE:ALV
Autoliv — Non-Deal Roadshow (February 2014)
32 slides from Autoliv's roadshow presentation, Feb 3, 2014
Slide 1: Post Q4'13 Results Non-Deal Roadshow
Post Q4’13 Results Non-Deal Roadshow Boston & NYC Jan Carlson – President & CEO February 3-4, 2014 Driven for Life. © Autoliv Inc., All Rights Reserved
Slide 2: Safe Harbor Statement
Safe Harbor Statement * This presentation contains statements that are not historical facts but rather forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include those that address activities, events or developments
Slide 3: Q4 Highlights
Q4 Highlights - Record sales drive solid financial performance Sales and EBIT* better than expected • Organic* sales growth ~ 15%, ~ 6 pp better • Double digit EBIT* margin 10%, ~ 1 pp better EPS* $1.70 • YoY improvement driven by higher operating profit Capital Structure • Operating cash flow* ~ $0
Slide 4: Q4 Financial Overview
Q4 Financial Overview - Solid financial performance (US$ Mil’s unless specified) 2013 2012 Sales $2,352 $2,052 Gross Profit $455 19.3% $395 19.3% EBIT * $236 10.0% $193 9.4% EPS * (assuming dilution) $1.70 $1.58 RoCE * 27% 23% RoE * 16% 16% Operating Cash flow* $299 $241 Dividend ** $0.50 $0.50 GLVP
Slide 5: Q4 2013 - EBIT Bridge vs. Guidance and Prior Year
Q4 2013 - EBIT* Bridge vs. Guidance and Prior Year Q4 vs. Guidance 100 bps better Q4 vs. Prior Year 60 bps better 10.0% 10.0% 9.0% 9.4% MUS$ MUS$ EBIT Margin* 10% (*) Non US GAAP Earnings Before Interest and Taxes excludes costs for capacity alignments, antitrust investigations and valuation allowan
Slide 6: Strong Performing Models in China
Strong Performing Models in China - Q4’13 Honda CR-V Chevrolet Cruze GreatWall Haval H6 Nissan Teana VW Lavida/Bora Ford Kuga Nissan Qashqai Wuling HongGuang Nissan Sylphy Estimated 2013 market share in China is ~ 37% for airbags and seatbelts combined ALV Q4’13 Financial Earnings Report - 6 © Autol
Slide 7: Enhancing Market Position
Enhancing Market Position - Units delivered exceed LVP in most product areas Autoliv Quantities Delivered Q4’13 Q4 vs. PY (Millions unless specified) Seatbelts 36.8 4% • Pretensioners (of which) 14.9 11% • Active Seatbelts (of which) 0.7 70% Frontal airbags 11.7 20% • Knee airbags (of which) 1.2 59%
Slide 8: FY 2013 Recap
FY 2013 Recap - Organic sales offset by currencies and margin challenges Growth • Record sales on organic* sales growth of 7% mostly driven by China ~26% and Active Safety ~ 57% • Solid financial performance and cash flow generation Capital structure • Share repurchase re-initiated, announced record
Slide 9: FY13 Financial Overview
FY13 Financial Overview - Solid financial performance (US$ Mil’s unless specified) FY13 FY12 Sales $8,803 $8,267 Gross Profit $1,705 19.4% $1,646 19.9% EBIT * $808 9.2% $803 9.7% EPS * (assuming dilution) $5.82 $5.82 RoCE * 23% 24% RoE * 14% 15% Operating Cash flow* $838 $689 DPS ** $2.00 $1.89 GLVP
Slide 10: Cash Flow
Cash Flow - Investments for growth in CapEx and shareholder returns (US $ Mil’s unless specified) Q4 Q4 FY FY FY FY FY 2013 2012 2013 2012 2011 2010 2009 Net Income 101 140 490 486 627 596 13 Depreciation & Amortization 75 69 286 273 268 282 314 Other, net 5 (4) 43 10 38 57 (41) Change in operating
Slide 11: Capacity Alignment Program
Capacity Alignment Program (US$ Mil’s unless otherwise FY12 Q1’13 Q2’13 Q3’13 Q4’13 FY13 specified) Cost (gross) $79 $3 $3 $1 $33 $40 Cash outlay - $5 $4 $5 $6 $20 Savings ** - ~ $3 ~ $3 ~ $3 ~ $3 ~ $12 Balance Sheet * $75 $70 $70 $68 $94 $94 Estimate cost and cash outlay in the range of $20 to $40M
Slide 12: Share Repurchase Program
Share Repurchase Program* - Re-initiated in October 2013 35.9 million shares average cost $45.09 148 remaining authorization ~ 11.6 million shares 173 380 221 1,621 378 144 30 43 103 2000 2001 2002 2003 2004 2005 2006 2007 2008 2013 TOTAL Cost / share $22.68 0 $19.57 $20.97 $41.97 $44.86 $55.69 $57.
Slide 13: Dividend Trend
Dividend Trend - Per share and cash payments* 0.6 60 Dividend per share 0.4 40 $ US Millions $ per share 0.2 20 Dividend Payments 0 0 1997 ‘98 ‘99 2000 ‘01 ‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 2010 ‘11 ‘12 ‘13 ‘14 Annualized dividend $2.08 per share (*) Estimated dividend payment for Q1 2014 based on sha
Slide 14: Enhancing Market Position
Enhancing Market Position - Units delivered exceed LVP in most product areas Autoliv Quantities Delivered FY’13 FY vs. PY (Millions unless specified) Seatbelts 143.2 3% • Pretensioners (of which) 56.1 2% • Active Seatbelts (of which) 2.1 35% Frontal airbags 43.5 16% • Knee airbags (of which) 4.4 74%
Slide 15: Leading thru Innovation
Leading thru Innovation - Another strong year of new product introductions INNOVATIONS 2013 Improving automotive safety for both vehicle occupants and vulnerable road users ALV Q4’13 Financial Earnings Report - 15 © Autoliv Inc., All Rights Reserved
Slide 16: Market Conditions
Market Conditions - Early look at 2014 light vehicle production Asia • Strong growth to continue in China setting new records • Japan is expected to decline for the full year after a strong Q1 • RoA combined is expected to have moderate growth Americas • Steady US SAAR, inventories remain stable • G
Slide 17: Key Model Launches
Key Model Launches - FY2014 Ford F-Series Great Wall Haval H8 Chrysler 200C VW Passat Hyundai Sonata Haima Auto M3 Fiat Freemont KIA Sorento Geely Emgrand EC7 Acura TLX China will continue to show strong growth in 2014 ALV Q4’13 Financial Earnings Report - 17 © Autoliv Inc., All Rights Reserved
Slide 18: Looking Ahead - Q1 2014
Looking Ahead - Q1 2014 Sales • YoY organic* sales increase ~ 7% mainly due to China, Active Safety and Japan • Sequential organic* sales decline ~ 3% seasonal effect of China and Korea EBIT* Margin ~ 8% • YoY RD&E net and ramping-up capacity for growth and vertical integration more than offset the
Slide 19: Looking Ahead - FY 2014 indication
Looking Ahead - FY 2014 indication Sales • YoY organic* sales increase ~ 5% mainly related to Active Safety, China and the Americas EBIT* Margin ~ 9% • YoY RD&E net and ramping-up capacity for growth and vertical integration offset the benefit from organic* sales, decreasing margin challenges and co
Slide 20: Financial Outlook
Financial Outlook Q1 2014 FY2014 Sales Organic* ~ 7% ~ 5% Acquisitions / (Divestitures) - - Fx** (0.4%) 0.1% Consolidated Sales ~ 6.5% ~ 5% EBIT Margin * ~ 8% ~ 9% Expect another year of solid financial performance in 2014 (*) Non US GAAP measure, Earnings Before Interest and Taxes excludes costs fo
Slide 21: Autoliv - Thank you!
Thank you! Autoliv - Safety Systems Active Autoliv Safety Every year, Autoliv’s products save over 30,000 lives Passive The Worldwide Leader in Automotive Safety Systems Safety ALV Q4’13 Financial Earnings Report - 21 © Autoliv Inc., All Rights Reserved
Slide 22: Our Key Strategies
Our Key Strategies Focus on savings lives and safety around the automobile Lead thru innovation and technology Leverage global footprint and talented-skilled people Zero defects and customer focus “One Stop Shop” for automotive safety system solutions ALV Q4’13 Financial Earnings Report - 22 © Autol
Slide 23: Long-Term Targets
Long-Term Targets - Creating long-term shareholder value Organic sales growth at least in line with our market • and faster than our market including acquisitions Operating margin range 8-9% over the business cycles • US GAAP excluding costs related to the antitrust investigations EPS growth faster
Slide 24: Operational Priorities
Operational Priorities - Strong sales growth brings related margin challenges Europe • Operating inefficiencies related to; • underutilized capacity • steering wheel growth • capacity alignments Brazil • Ramp-up for growth and supply chain issues Investments for growth • Improving R,D&E leverage whi
Slide 25: Autoliv in Summary
Autoliv in Summary Solid performance in 2013 150 000 120 000 2014 will be a transition year to address 90 000 our margin challenges 60 000 30 000 Executing on our key strategies towards 0 2012 long-term targets We envision 150,000 lives saved by our products annually Positioning our company to capit
Slide 26: Prevention – Protection
“Prevention – Protection” - Safety in all aspects POINT OF NO RETURN (One third of a second) Prevention Protection ALV Q4’13 Financial Earnings Report - 26 © Autoliv Inc., All Rights Reserved
Slide 27: The Road Towards Saving More Lives
The Road Towards Saving More Lives The main questions remaining are when and how? ALV Q4’13 Financial Earnings Report - 27 © Autoliv Inc., All Rights Reserved
Slide 28: Light Vehicle Production - 4th Quarter
Light Vehicle Production - 4th Quarter 2013 2012 2013 vs. 2012 ALV YoY Vehicles in millions @ Jan 16 @ Oct 16 Org. Growth Americas 5.1 4.9 3% 2% ~ 7% - North America 4.0 3.8 6% 6% - South America 1.1 1.1 (8%) (11%) Europe 4.8 4.7 3% 0% ~ 11% - WEU 3.1 3.0 6% 3% - EEU 1.7 1.7 (1%) (4%) Japan 2.3 2.0
Slide 29: Light Vehicle Production - FY
Light Vehicle Production - FY 2013 vs. 2012 ALV YoY Vehicles in millions @ Jan 16 @ Oct 16 Org. Growth 2013 2012 Americas 20.7 19.7 5% 5% ~ 3% - North America 16.2 15.4 5% 5% - South America 4.5 4.3 6% 5% Europe 19.3 19.3 0% (1%) ~ 5% - WEU 12.6 12.6 0% (1%) - EEU 6.7 6.7 1% 0% Japan 8.9 9.2 (4%) (4
Slide 30: Light Vehicle Production - 1st Quarter
Light Vehicle Production - 1st Quarter 2014 2013 2014 vs. 2013 ALV YoY Vehicles in millions @ Jan 16 Org. Growth Americas 5.3 5.0 5% - North America 4.3 4.0 6% - South America 1.0 1.0 (1%) Europe 5.0 4.8 4% - WEU 3.3 3.2 5% - EEU 1.7 1.6 2% Japan 2.5 2.2 14% China 5.4 4.8 8% RoA 3.1 3.3 (7%) Other *
Slide 31: Light Vehicle Production - FY
Light Vehicle Production - FY 2014 vs. 2013 ALV YoY Vehicles in millions @ Jan 16 Org. Growth 2014 2013 Americas 21.4 20.7 4% - North America 16.8 16.2 4% - South America 4.6 4.5 2% Europe 19.5 19.3 1% - WEU 12.7 12.6 1% - EEU 6.8 6.7 1% Japan 8.2 8.9 (8%) China 21.6 19.6 10% RoA 12.9 12.6 3% Other
Slide 32: Rating and Regulations
Rating and Regulations - US NCAP migration to Active Safety and Adaptive IIHS Ratings: • New IIHS Small Overlap test – Integrated into Top Safety Pick “Plus” for 2013. • FCW and/or AEB – “Availability” of FCW required for Top Safety Pick “Plus” for 2014. NHTSA - USNCAP: • Back-over Safety – ESC reco