Slide 1: Earnings Call Presentation 3 Quarter 2020
Earnings Call Presentation 3 Quarter 2020 October 23, 2020 Autoliv
Slide 2: Forward-looking statements
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 that Autoliv, Inc. or it
Slide 3: Third quarter highlights
▪ Focusing on health and safety ▪ Sales growth despite global light vehicle production (LVP) down 4% − Stronger than expected LVP recovery − Execution on strong order book − Economic uncertainty, risk for further lockdowns and the threat of unemployment temper the outlook for fourth quarter LVP ▪ Ad
Slide 4: Consolidated Sales, Adjusted Operating Income, Operating Cash Flow
Consolidated Sales Adjusted Operating Income* Operating Cash Flow US$ (Millions) US$ (Millions) US$ (Millions) 0.5% 23M 157M 10.1% Adj. $352 9.0% Adj. Op. Margin* $2,028 $2,037 Op. Margin* $206 $183 $195 Q3´19 Q3´20 Q3´19 Q3´20 Q3´19 Q3´20 (*) Non-US GAAP measures exclude costs for capacity alignmen
Slide 5: Sales Bridge and Regional Organic Growth vs. LVP
Sales Bridge Regional Organic Growth** vs. LVP* US$ (Millions) 0.5% 0.4% Org. growth** EUROPE JAPAN AMERICAS CHINA REST OF ASIA (*) Light Vehicle Production (LVP) according to IHS @ October 2020 (**) Non-US GAAP measure
Slide 6: Vehicle launches featuring Autoliv products
Hyundai Tucson Cadillac Escalade Nissan Rogue/X-Trail Mercedes S-Class Ford F-150 VW ID.3 Ford Bronco Citroen C4 Ford Mustang Mach-E
Slide 7: Q3 2020 key financials
(US $ Millions unless specified) Q3’20 Q3’19 Sales $2,037 $2,028 Gross Profit $400 19.6% $379 18.7% Adj. Operating Income1 $206 10.1% $183 9.0% EPS (assuming dilution) $1.12 $0.98 Adj. RoCE1,2 22% 19% Adj. RoE1,2 25% 23% Operating cash flow $352 $195 Dividend paid per share - $0.62 Global LVP3 (annu
Slide 8: Adjusted operating margin bridge
110 bps Operations 110 bps 10.1% + Pos 9.0% 40 bps -60 bps 20 bps • Productivity improvement in material and personnel cost • Structural efficiency programs • Discretionary spending • Governmental support - Neg • Inefficiencies related to COVID-19 • Direct costs related to COVID-19 (*) Non-US GAAP m
Slide 9: Earnings per Share and Adjusted Earnings per Share
Earnings per Share Adjusted Earnings per Share* US$ US$ $0.14 $0.18 The main items impacting EPS were: ▪ +17 cents from higher adj. operating income $1.48 $1.30 ▪ +6 cents from tax $1.12 $0.98 ▪ -4 cents from higher capacity alignments ▪ -5 cents from higher financial items Q3'19 Q3'20 Q3'19 Q3'20 (
Slide 10: Cash flow, Capex and D&A
Capex and D&A (US$ Millions unless specified) Q3’20 Q3’19 LTM 2019 Net Income $99 $86 $155 $463 Depreciation & Amortization 93 84 359 351 EC antitrust payment - - - -203 Other, net 23 9 -70 -17 Change in operating WC 138 16 248 47 Operating cash flow 352 195 692 641 Cash Conversion2 Operating cash f
Slide 11: Net Debt / EBITDA
Net Debt and EBITDA per the Policy Net Debt/ EBITDA* x $2,000 3.0 $1,500 2.5 2.4x $1,000 2.0 $500 1.5 Q1´19 Q2´19 Q3´19 Q4´19 Q1´20 Q2´20 Q3´20 0.5-1.5x Net Debt EBITDA Long-Term Target: 1.0x 1.0 Long-Term Range 0.5 ▪ Our Net Debt* decreased by $265M from Q2’20 0.0 ▪ EBITDA LTM increased by $29M fro
Slide 12: Debt Maturities end of Q3 2020
Debt Maturities end of Q3´20* % of ~$3 billion total debt ~30% in the next 3 years • Significant liquidity cushion with $2.0 billion in cash and 2020 unutilized credit facilities at September 30 5% 2021 • As of October of 2nd the Revolving Credit Facility is fully 11% repaid and available if needed
Slide 13: Structural efficiency program
▪ Substantially completed by second quarter 2021 ▪ Cost in Q3´20 was ~30 million ▪ All functions are subject to the program ▪ First plant closure decision in Europe • 200+ employees affected in Germany ▪ Mainly impacting Europe and Americas ▪ Evaluating further footprint optimization 2020 FY2021 Exp
Slide 14: Assumption for the fourth quarter: light vehicle production
IHS: 2020 Light Vehicle Production* Q4´20 FY´20 Region YoY Million Y-o-Y Chg. Units Chg. China -4.7% 21.3 -8.7% Assumption for the fourth quarter: 7.6 Japan 1.1% -16.4% The expectations on LVP in North America has continued to improve and Q4 is now expected to Rest of Asia -8.6% 9.1 -25.8% show only
Slide 15: Tailwinds and headwinds
Tailwinds Headwinds ▪ Executing from strong order book ▪ Lower and unpredictable LVP ▪ Structural Efficiency Programs ▪ Lower inflator replacement sales ▪ Discretionary spending ▪ D&A increase ▪ Raw materials ▪ Operational headwinds from COVID-19 ▪ Strategic initiatives ▪ Investment for factory of t
Slide 16: Full year indication
Full year indication Sales, net Around -14.5% Exchange rates3 FY’20 Organic sales decline1 Around -13% EUR / US$ 1.1349 Org. sales outperformance vs. LVP Around 6 pp US$ / JPY 107.06 FX Around -1.5% US$ / KRW 1188 US$ / MXN 21.58 Adjusted Operating margin1 Around 6% US$ / CNY 6.94 Tax rate2 Around 4
Slide 17: Summary and priorities
▪ Health and Safety remain top priority ▪ Challenging situation requires agility and making tough decisions ▪ Assessing the new run rate of LVP and continuously adjusting ▪ Executing on our long-term strategies ▪ Continued flawless execution in a challenging situation
Slide 18: Each year, Autoliv's products save over 30,000 lives
Each year, Autoliv’s products save over 30,000 lives autoliv.com
Slide 19: Autoliv Quantities Delivered Q3 2020 vs. PY
Autoliv Quantities Delivered Q3´20 vs. PY** (Millions unless specified) Seatbelts 33.9 (1)% ▪ Pretensioners (of which) 20.4 8% ▪ Active Seatbelts (of which) 1.5 1% Frontal Airbags 13.2 (2)% ▪ Knee Airbags (of which) 1.4 12% Side Airbags 23.8 3% ▪ Chest (Thorax) 13.1 4% ▪ Head (Curtain) 10.6 1% Steer
Slide 20: Definition of Symbols
Definition of Symbols 4 = Driver and/or Passenger airbags ah = Pedestrian Airbag A = Seatbelts @ « Steering Wheel A » Side airbags NA = Front Center Airbag Of # Head/Inflatable Curtain airbags A. = Belt-bag e = Knee airbag [F] * Pyrotechnical Safety Switch Autoliv