Slide 1: Results 9M 2016 Schaeffler AG
Results 9M 2016 Schaeffler AG Conference Call November 9, 2016 Herzogenaurach
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements. The words "anticipate", "assume", "believe", "estimate", "expect", "intend", "may", "plan", "project“, "should" and similar expressions are used to identify forward-looking statements. Forward-looking statements are statements that ar
Slide 3: Agenda
Agenda 1 Overview 2 Operational Highlights 3 Financial Results 4 Outlook 3 November 9, 2016 Schaeffler AG 9M 2016 Results
Slide 4: Strong Group 9M 2016 Results
1 Overview Strong Group 9M 2016 Results Sales and EBIT margin Key aspects 9M in EUR mn +2.7%1) Group sales +2.7% (FX-adjusted) – 9M EBIT margin at 12.8% 9,958 9,977 (9M'15: 12.6%2)) Automotive sales +5.3% (FX-adjusted) – 9M EBIT margin at 14.3% (9M'15: 13.5%2)) 9M 2015 9M 2016 EBIT margin2) 12.6% 12
Slide 5: Sales growth 9M 2016 2.7% (FX-adjusted)
2 Operational Highlights Sales growth 9M 2016 2.7% (FX-adjusted) Sales Sales by region 9M 2016 in EUR mn y-o-y growth (w/o FX effects) Asia/Pacific +2.7%1) +2.9% (+4.4%) vs 9M 2015 Greater China 10.3% 3,339 3,382 3,343 3,369 +5.5% (+10.5%) 3,237 3,221 3,265 14.3% 54.2% 21.2% Americas Europe -5.0% (-
Slide 6: Automotive Division – Sales +5.3% (FX-adjusted)
2 Operational Highlights Automotive Division – Sales +5.3% (FX-adjusted) Automotive sales and EBIT margin Key aspects Automotive 9M in EUR mn +5.3%1) 7,511 7,703 Growth in all regions and business divisions 9M 2015 9M 2016 EBIT margin2) 13.5% 14.3% Strong earnings quality maintained – EBIT margin at
Slide 7: Automotive – Business divisions with different growth dynamics
2 Operational Highlights Automotive – Business divisions with different growth dynamics Automotive sales by division 9M Key aspects in EUR mn 9M 2015 +4.7%1) 9M 2016 Engine Systems: +2.4%1) 3,150 3,217 Strong volume increase for electro-mechanical phasing 1,946 1,960 +10.3%1) systems +6.2%1) 1,098
Slide 8: Automotive – Strong growth in Greater China
2 Operational Highlights Automotive – Strong growth in Greater China Automotive sales and market development 9M Key aspects Europe Americas Greater China Asia/Pacific +22% 1.9%-pts outperformance of global light vehicle production +11% +7% in 9M +4% +3% 0% +1% Strong development in Greater China:
Slide 9: Automotive – Strong growth in Automotive Aftermarket
2 Operational Highlights Automotive – Strong growth in Automotive Aftermarket Key aspects Automotive Aftermarket sales by region (YTD) y-o-y growth (w/o FX effects) Top 3 market leader in all three main product groups Continuous profitable growth (+10% FX-adjusted in 9M 2016) driven by Asia/Paci
Slide 10: Industrial Division – Sales -5.3% (FX-adjusted)
2 Operational Highlights Industrial Division – Sales -5.3% (FX-adjusted) Industrial sales and EBIT margin Key aspects Industrial 9M in EUR mn -5.3%1) 2,447 2,274 Market environment still challenging – Industrial sectors and distribution with mixed development 9M 2015 9M 2016 EBIT margin2) 10.0% 7.6%
Slide 11: Industrial – Mixed development across sectors
2 Operational Highlights Industrial – Mixed development across sectors Industrial sales by sector cluster 9M1) Key aspects Two-Wheelers Wind Positive development of Two-Wheelers, Wind and Aerospace in 9M Aerospace Industrial Automation Low commodity prices and in particular the current oil price
Slide 12: Industrial – Challenging market environment in all regions
2 Operational Highlights Industrial – Challenging market environment in all regions Industrial sales by region 9M Key aspects in EUR mn 9M 2015 9M 2016 Europe: Strong sales increase in Wind, Aerospace and Two-Wheelers; -0.9%1) sales decline in other sectors 1,382 1,352 -6.4%1) Americas: Positive
Slide 13: Industrial – New contracts signed in strategic sectors
2 Operational Highlights Industrial – New contracts signed in strategic sectors WindEnergy in Hamburg Business Highlights Successful participation at Long-term contracts signed with major wind industry players leading expo for wind energy in Hamburg in September Supply of large-size cylindrical a
Slide 14: Strong Free Cash Flow generation
2 Operational Highlights Strong Free Cash Flow generation Free Cash Flow Key aspects 9M 2015 9M 2016 Q3 2015 Q3 2016 Free Cash Flow increased by EUR 287 mn to EUR 479 mn in 9M 2016 EBITDA 1,765 1,817 604 600 Net interest paid dropped by EUR 302 mn in 9M 2016 Net interest paid -389 -87 -50 -53
Slide 15: Key figures 9M 2016
3 Financial Results Key figures 9M 2016 9M '16 Q3 '16 in EUR mn 9M '15 9M '16 vs. 9M '15 Q3 '15 Q3 '16 vs. Q3 '15 +0.2% +0.9% Sales 9,958 9,977 3,237 3,265 +2.7%1) +2.3%1) 1,2582) +1.4% EBIT 1,276 433 417 -3.7% 1,251 +2.0% 12.6%2) +0.2%-pts. EBIT margin 12.8% 13.4% 12.8% -0.6%-pts. 12.6% +0.2%-pts.
Slide 16: Net income 9M 2016 EUR 672 mn
3 Financial Results 1 Net income 9M 2016 EUR 672 mn Net income1) Financial result2) 253 EUR -142 mn in EUR mn 241 in EUR mn 212 vs 9M 2015 167 178 176 167 161 142 125 85 88 70 65 521 462 591 672 547 320 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2015 2016 2015 2016 2) For presentation purposes negati
Slide 17: Working Capital ratio stable – Capex ratio 8.3%
3 Financial Results 2 Working Capital ratio stable – Capex ratio 8.3% Working capital1) Capex2) in EUR mn in EUR mn 2,820 2,796 2,802 318 2,738 2,666 2,740 282 268 2,430 257 243 244 242 743 1,025 829 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2015 2016 2015 2016 In % of sales In % of sales (LTM) 7.3
Slide 18: Leverage ratio dropped to 1.2x
3 Financial Results 3 Leverage ratio dropped to 1.2x Net financial debt and leverage ratio Change in net financial debt in EUR mn in EUR mn 5,688 +20 +981 5,441 6,190 6,245 5,950 -1,248 4,889 4,909 4,874 2,876 -2,565 2.7 2.7 2.6 2.1 2,876 2.1 2.0 Gross debt Repay- New FX effect Gross debt Cash Net d
Slide 19: Guidance confirmed – On track to achieve 2016 targets
4 Outlook Guidance confirmed – On track to achieve 2016 targets Guidance 2016 Sales growth 3-5% FX-adjusted EBIT margin 12-13% of sales before one-off effects 2016 Guidance confirmed Free Cash Flow ~ EUR 600 mn Market assumptions Automotive: Global Light Vehicle production growth of around 2.5%
Slide 20: Financial calendar 2016/2017
4 Outlook Financial calendar 2016/2017 Nov 9, 2016 Results 9M 2016 Nov 22, 2016 HSBC High Yield Conference, London Dec 8-9, 2016 Goldman Sachs Annual Global Automotive Conference, London Jan 10, 2017 Deutsche Bank Global Auto Industry Conference, Detroit Jan 11, 2017 Commerzbank German Investment Se
Slide 21: IR Contact
IR Contact Investor Relations Financial Calendar FY 2016 results: March 8, 2017 Phone: + 49 9132 82 4440 Q1 2017 results: May 11, 2017 Email: ir@schaeffler.com Web: www.schaeffler.com/ir 21 November 9, 2016 Schaeffler AG 9M 2016 Results
Slide 22: Corporate and Financing Structure
Backup Overview Corporate and Financing Structure Corporate Structure (simplified) Financing Structure as of October 14, 2016 as of October 14, 2016 INA-Holding Schaeffler IHO Verwaltungs GmbH (HoldCo) GmbH & Co. KG Nominal Nominal Debt instrument Interest Maturity Rating (USD mn) (EUR mn) Term loan
Slide 23: Working Capital
Backup Working Capital Working Capital (as previously reported) Working Capital (as reported from H1'16 onwards) in EUR mn in EUR mn 3,016 3,068 3,022 2,944 2,956 2,802 2,880 2,820 2,796 2,662 2,738 2,740 2,666 2,430 2,266 2,250 2,282 2,215 2,215 2,250 2,119 2,023 2,266 2,282 2,215 2,215 2,119 2,023
Slide 24: Earnings per share
Backup Earnings per share Earnings per common non-voting share (as reported) Earnings per common non-voting share (ProForma1)) in EUR in EUR 0.53 0.42 0.38 0.37 0.38 0.37 0.36 0.36 0.28 0.27 0.24 0.27 0.11 0.11 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2015 2016 2015 2016 YTD YTD Sept. 1.31 1.02 Sep