Traton Se · XETR:8TRA
Traton — FY2020 Earnings Presentation
50 slides from Traton's earnings presentation, Mar 22, 2021
Slide 1: Investor Relations Conference Call for Fiscal Year 2020
Munich - March 22, 2021 INVESTOR RELATIONS CONFERENCE CALL FOR FISCAL YEAR 2020 MATTHIAS GRÜNDLER, CEO CHRISTIAN SCHULZ, CFO ISIN: DE000TRAT0N7 WKN: TRAT0N Bloomberg Ticker: 8TRA GY/8TRA SS http://ir.traton.com
Slide 2: Disclaimer
DISCLAIMER This presentation has been prepared for information purposes only. It does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities of Volkswagen AG, TRATON SE, or any company of the TRATON GROUP
Slide 3: Agenda
AGENDA 01. 2020 at Glance 02. Outlook 2021 03. Back up a. TRATON GROUP Highlights b. Segment Industrial Business c. Segment Financial Services d. Appendix March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 3
Slide 4: 2020 – A Year of Two Faces
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP 2020 – A YEAR OF TWO FACES Extremely challenging first half with a dramatic drop in demand with negative consequences for sales units and production volumes due to COVID-19 pandemic, especially in the second quarter Strong recovery in the second half,
Slide 5: Despite the challenges, 2020 was a year with many successes for TRATON
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP DESPITE THE CHALLENGES, 2020 WAS A YEAR WITH MANY SUCCESSES FOR TRATON • Incoming orders: -5% to 216,251 units • Unit sales: -21% to 190,180 units FY • Sales revenue: -16% to €22,580 mn 2020 • Adjusted operating result: €135 mn, adjusted RoS 0.6% • Net
Slide 6: Second half of 2020 with strong recovery…
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP SECOND HALF OF 2020 WITH STRONG RECOVERY… Noticeable market recovery, though business activities SALES REVENUE (€ bn) still significantly impacted by the COVID-19 pandemic 12.5 10.1 Incoming orders: +47% vs. H1 2020 H1 18 H2 18 H1 19 H2 19 H1 20 H2 20
Slide 7: …in almost all areas
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP …IN ALMOST ALL AREAS H2 2020 H1 2020 +/- H2 2020 H1 2020 +/- H2 2020 H1 2020 +/- Trucks and buses (units) Incoming orders 58,667 34,273 71% 46,729 38,192 22% 23,630 15,175 56% Unit sales 41,648 30,437 37% 50,011 31,662 58% 21,087 15,887 33% 11 of which
Slide 8: Agenda
AGENDA 01. 2020 at Glance 02. Outlook 2021 03. Back up a. TRATON GROUP Highlights b. Segment Industrial Business c. Segment Financial Services d. Appendix March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 8
Slide 9: Business climate is brightening, but still fragile
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP BUSINESS CLIMATE IS BRIGHTENING, BUT STILL FRAGILE Growth in 2021 expected, but fragile environment Truck registrations (> 16t) in Europe improving2 Global growth1 collapsed in 2020. Recovery expected in 2021, but less buoyant in EU than initially expe
Slide 10: Yet the positive trend continued in the fourth quarter of 2020
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP YET THE POSITIVE TREND CONTINUED IN THE FOURTH QUARTER OF 2020 INCOMING ORDERS & UNIT SALES (k units) INCOMING ORDERS & UNIT SALES (YoY change, %) 80 30 70 20 60 10 0 50 -10 40 -20 30 -30 20 -40 10 -50 0 -60 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
Slide 11: Positive truck market outlook, depending heavily on COVID-19 development
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP POSITIVE TRUCK MARKET OUTLOOK, DEPENDING HEAVILY ON COVID-19 DEVELOPMENT TRUCK MARKET EXPECTATIONS (˃ 6t, k units) 376 Market 400 341 expectations2 EU27+31 300 300 2021e 200 273 +10% – 100 +25% 0 2009 2011 2013 2015 2017 2019 2021e Market 300 expectati
Slide 12: TRATON Outlook 2021 – Recovery after strong decline
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP TRATON OUTLOOK 2021 – RECOVERY AFTER STRONG DECLINE FY 2019 FY 2020 FY 2021 Outlook1 242.2 k 190.2 k Sharp Unit sales +4% -21% increase €26.9 bn €22.6 bn Substantial Group sales revenue +4% -16% increase Operating return on sales 7.0% 0.4% 5.0 – 6.0% &
Slide 13: 2021 remains challenging, but recovery expected
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP 2021 REMAINS CHALLENGING, BUT RECOVERY EXPECTED GLOBAL ECONOMY clearly recovering, but still challenging year due to BUSINESS CLIMATE uncertainties and severe impacts from COVID-19 pandemic truck markets in core regions recovering, but not yet reaching
Slide 14: MAN T&B measures to improve earnings
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP MAN T&B MEASURES TO IMPROVE EARNINGS Overview by item (€ mn) Key Issues Paper to realign MAN T&B agreed • Strong focus on future technologies. 1,700 • Repositioning of the production and development 550 network. • Reduction of ~3,500 jobs across all ar
Slide 15: Navistar next steps – closing of planned acquisition & subsequent integration
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP NAVISTAR NEXT STEPS – CLOSING OF PLANNED AQUISITION & SUBSEQUENT INTEGRATION Signing and announcement of binding merger agreement on November 7, 2020 On March 2, 2021 Navistar shareholders approved TRATON’s proposal to acquire Navistar Regulatory appro
Slide 16: Our brands focus on e-mobility leadership
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP OUR BRANDS FOCUS ON E-MOBILITY LEADERSHIP SINCE 2020 BY 2025 BY 2030 Common modular electric powertrain Electrified vehicles will account for around Electrified vehicles will account for 50% toolkit, used in the first series produced 10% of Scania’s to
Slide 17: TRATON increases R&D investment in e-mobility to €1.6 billion
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP TRATON INCREASES R&D INVESTMENT IN E-MOBILITY TO €1.6 BILLION TRATON invests All brands are shifting budgets from €1.6 billion in R&D for conventional drives to e-mobility e-mobility from 2021 to 2025 Share of product development1 for e-mobility will b
Slide 18: Agenda
AGENDA 01. 2020 at Glance 02. Outlook 2021 03. Back up a. TRATON GROUP Highlights b. Segment Industrial Business c. Segment Financial Services d. Appendix March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 18
Slide 19: Group – Segment Highlights Q4/FY 2020
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP GROUP – SEGMENT HIGHLIGHTS Q4/FY 2020 Industrial Business (IB) Financial Services (FS) Q4 2020 YoY FY 2020 YoY Q4 2020 YoY FY 2020 YoY 2 Incoming orders (units) 70,318 +22% 216,251 -5% Net portfolio (€ bn) 9.5 -4% Unit sales (units) 62,520 -1% 190,180
Slide 20: Group – Sales Revenue and Return on Sales
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP GROUP – SALES REVENUE AND RETURN ON SALES SALES REVENUE (€ mn) Return on sales (%) Growth YoY (%) -3% -11% -26% -21% -16% 7,128 7,075 6,839 6,413 6,286 5,679 5,667 22,580 4,394 15,740 7.6 8.2 6.5 5.7 2.8 2.91 2.01 10,073 5,679 -8.7 2.8 -2.2 -0.41 0.41
Slide 21: Group – Unit Sales Development
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP GROUP – UNIT SALES DEVELOPMENT Unit Sales (units) Growth YoY (%) -1% 66,173 -20% -37% -29% -21% 63,128 62,520 57,163 6,014 55,755 5,721 4,334 Buses 4,210 5,551 49,922 45,990 190,180 4,591 4,030 16,174 31,748 127,660 1 60,159 57,407 3,219 58,186 11,840
Slide 22: Group – Unit Sales Growth in Core Markets
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP GROUP – UNIT SALES GROWTH IN CORE MARKETS Truck unit sales in core markets1; 2020 (units) Growth FY (YoY) Market growth (YoY)3 Q1 20,783 2 H1 33,617 -32% -28% 9M 53,339 FY 81,719 Q1 6,117 H1 9,617 -26% -26% 9M 16,007 FY 24,825 Q1 10,865 H1 18,079 -13%
Slide 23: Agenda
AGENDA 01. 2020 at Glance 02. Outlook 2021 03. Back up a. TRATON GROUP Highlights b. Segment Industrial Business c. Segment Financial Services d. Appendix March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 23
Slide 24: Industrial Business – Incoming Orders
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP INDUSTRIAL BUSINESS – INCOMING ORDERS INCOMING ORDERS (units) Book-to-bill1 (ratio in units) Growth YoY (%) 1.13 0.85 0.88 0.91 1.18 1.05 1.17 1.12 -16% -27% -14% -5% +22% 216,251 70,318 64,357 56,134 57,532 54,161 58,502 145,933 49,217 33,270 87,431 5
Slide 25: Industrial Business – Unit Sales
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP INDUSTRIAL BUSINESS – UNIT SALES UNIT SALES (units) Growth YoY (%) -1% -20% -37% -29% -21% 66,173 63,128 62,520 57,163 55,755 49,922 190,180 45,990 31,748 127,660 77,738 45,990 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 20 H1 20 9M 20 FY 20 • T
Slide 26: Industrial Business – Sales Revenue and Return on Sales
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP INDUSTRIAL BUSINESS – SALES REVENUE AND RETURN ON SALES SALES REVENUE (€ mn) Return on sales (%) Growth YoY (%) -3% -12% -26% -21% -16% 7,015 6,953 6,736 6,305 6,171 22,156 5,564 5,565 4,290 15,419 7.3 7.9 6.0 5.2 2.4 2.21 1.71 9,854 5,564 -9.3 2.4 -2.
Slide 27: Industrial Business – Regional Truck Unit Sales Development
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP INDUSTRIAL BUSINESS – REGIONAL TRUCK UNIT SALES DEVELOPMENT1 EU27+32 (units) Germany (units) South America (units) Brazil (units) 34,482 31,948 0% 28,360 28,380 25,855 20,783 19,722 +12% 13,750 +3% 12,834 +16% 11,532 12,859 12,543 12,670 10,865 11,345
Slide 28: Industrial Business – Sales Revenue by Brand and Return on Sales
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP INDUSTRIAL BUSINESS – SALES REVENUE BY BRAND AND RETURN ON SALES SALES REVENUE Q4 2020 (€ mn) SALES REVENUE FY 2020 (€ mn) Growth rate (%) Return on sales (%) Growth rate (%) Return on sales (%) 9.6%1 -4.5% -3.0% 1.7%1 6.5%1 -5.7% -1.2% -0.1%1 1,235 22
Slide 29: Industrial Business – Leverage Ratios
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP INDUSTRIAL BUSINESS – LEVERAGE RATIOS GEARING RATIO1 (in %) NET DEBT/ADJUSTED EBITDA2 (x) Net liquidity as of December 31, 2020 amounted to €27 mn, mainly due to the net cash outflow of €-1.4 bn resulting primarily from the end of the domination and pr
Slide 30: Industrial Business – Net Liquidity
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP INDUSTRIAL BUSINESS – NET LIQUIDITY NET LIQUIDITY/NET FINANCIAL DEBT BRIDGE (€ mn) 158 Incl. €-1,404 mn profit (1,327) transfer and €-501 mn dividend payment 1,846 Net Liquidity 1,500 (2,149) 27 Net liquidity Gross Change in Investing activities Other
Slide 31: Industrial Business – Financial Resilience
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP INDUSTRIAL BUSINESS – FINANCIAL RESILIENCE SOUND BALANCE SHEET POSITION SOUND LIQUIDITY POSITION (Industrial Business; as of December 31, 2020) (Industrial Business; as of December 31, 2020) • Equity ratio: solidly at 36% • Strict cash and cost managem
Slide 32: Scania Vehicles & Services – Key Figures per Quarter
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP SCANIA VEHICLES & SERVICES – KEY FIGURES PER QUARTER Incoming orders (k units) Unit sales (k units) Book-to-bill1 (ratio in units) +48% -2% +45 bp 32.7 27.9 1.50 26.7 25.9 23.6 23.2 24.7 24.4 1.34 22.1 22.2 20.7 1.13 1.14 1.11 17.8 18.2 17.3 13.6 0.90
Slide 33: MAN Truck & Bus – Key Figures per Quarter
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP MAN TRUCK & BUS – KEY FIGURES PER QUARTER Incoming orders (k units) Unit sales (k units) Book-to-bill1 (ratio in units) -1% +1% +2 bp 29.9 29.1 28.4 28.1 1.33 25.2 1.20 25.0 24.9 24.1 25.0 1.04 20.8 21.6 22.5 21.9 0.93 0.99 18.2 0.86 0.88 0.89 14.1 13.
Slide 34: Volkswagen Caminhões e Ônibus – Key Figures per Quarter
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP VOLKSWAGEN CAMINHÕES E ÔNIBUS – KEY FIGURES PER QUARTER Incoming orders (k units) Unit sales (k units) Book-to-bill1 (ratio in units) +20 bp 1.23 +18% 0.99 0.99 1.03 0.97 1.02 -1% 0.91 0.94 11.1 10.7 11.1 12.5 10.5 11.2 10.9 8.9 10.4 9.5 9.8 10.3 9.9 1
Slide 35: Agenda
AGENDA 01. 2020 at Glance 02. Outlook 2021 03. Back up a. TRATON GROUP Highlights b. Segment Industrial Business c. Segment Financial Services d. Appendix March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 35
Slide 36: Financial Services – Sales Revenue and Return on Sales
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP FINANCIAL SERVICES – SALES REVENUE AND RETURN ON SALES SALES REVENUE (€ mn) Return on sales (%) Growth YoY (%) +6% -2% -4% -3% -3% 216 215 215 216 208 203 197 200 820 612 17.6 18.7 413 17.1 16.2 16.2 12.0 12.2 9.5 216 12.0 10.8 13.4 13.1 Q1 19 Q2 19 Q3
Slide 37: Financial Services – Net Portfolio and Penetration Rate
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP FINANCIAL SERVICES – NET PORTFOLIO AND PENETRATION RATE NET PORTFOLIO1 (€ bn) PENETRATION RATE2 (%) COMMENTARY Growth YoY (%) Growth YoY (pp) • By the end of December 2020 -0.4 -0.1 -0.3 -0.9 -0.9 -0.1 -0.2 -1.5 +14% +17% +18% +14% +3% -2% -5% -4% pp p
Slide 38: Agenda
AGENDA 01. 2020 at Glance 02. Outlook 2021 03. Back up a. TRATON GROUP Highlights b. Segment Industrial Business c. Segment Financial Services d. Appendix March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 38
Slide 39: Group – Overview by Quarter
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP GROUP – OVERVIEW BY QUARTER March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 39
Slide 40: Group – Condensed Income Statement
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP GROUP – CONDENSED INCOME STATEMENT March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 40
Slide 41: Group – Condensed Statement of Cash Flow
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP GROUP – CONDENSED STATEMENT OF CASH FLOW March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 41
Slide 42: Group – Net Liquidity
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP GROUP – NET LIQUIDITY March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 42
Slide 43: Group – Condensed Balance Sheet
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP GROUP – CONDENSED BALANCE SHEET March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 43
Slide 44: Group – Adjustments
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP GROUP – ADJUSTMENTS Adjustments (€ million) 2016 2017 2018 2019 2020 OPERATING RESULT 727 1,512 1,513 1,884 81 Expense for antitrust proceedings (Scania) 403 Release of restructuring provisions at MAN T&B -50 Expenses in relation to India market exit a
Slide 45: Group – Summary of Expected Development
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP GROUP – SUMMARY OF EXPECTED DEVELOPMENT March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 45
Slide 46: Industrial Business & Financial Business – At a Glance
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP INDUSTRIAL BUSINESS & FINANCIAL BUSINESS – AT A GLANCE March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 46
Slide 47: TRATON Share
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP TRATON SHARE SHARE DATA ISIN (International Securities Identification Number) DE000TRAT0N7 WKN (German Security Identification number) TRAT0N Common code 196390065 Frankfurt Stock Exchange (Frankfurter Wertpapierbörse) Stock exchange & Nasdaq Stockholm
Slide 48: Contacts Investor Relations
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP CONTACTS INVESTOR RELATIONS Rolf Woller Philipp Lotz Head of Treasury & Investor Relations Analysts and Investors, Rating, Debt Capital Markets +49 89 360 98 335 +49 89 360 98 283 rolf.woller@traton.com philipp.lotz@traton.com Margit Hartmann Thomas Pa
Slide 49: Financial Calendar (Expected Dates)
01. 2020 AT GLANCE 02. OUTLOOK 2021 03. BACK UP FINANCIAL CALENDAR (EXPECTED DATES1) Event/Publication of March 22, 2021 Annual Media Conference for fiscal year 2020 May 10, 2021 3M 2021 Interim Statement July 30, 2021 2021 Half-Year Financial Report October 29, 2021 9M 2021 Interim Statement TRATON
Slide 50: www.traton.com
WWW.TRATON.COM March 22, 2021 / Investor Relations / Conference Call for fiscal year 2020 50