Deutz Ag · XETR:DEZ
Deutz — Investor Presentation (May 2015)
33 slides from Deutz's investor presentation, May 2015
Slide 1: Investor presentation May 2015
Investor presentation May 2015
Slide 2: Agenda
Agenda DEUTZ strategy & positioning Financials Outlook 2
Slide 3: DEUTZ at a glance
DEUTZ at a glance More than 150 years DEUTZ – a tradition of achievement Independent manufacturer of diesel engines with product range from 25 to 520 kw Engineering and manufacturing company with strong expertise as system integrator Profile Worldwide sales channels and service network Strong brand
Slide 4: Corporate structure
Corporate structure DEUTZ Group Revenue 2014 €1,530.2 million DEUTZ Compact Engines DEUTZ Customised Solutions Revenue 2014 €1,279.9 million Revenue 2014 €250.3 million Liquid-cooled engines of up to 8 Air-cooled engines for on-road, off- litres cubic capacity for on- and off- road and marine applic
Slide 5: Site optimisation
Site optimisation Cologne-Porz 2016 Cologne-Porz Cologne-Deutz Ulm 2015/17 Ulm Übersee (Chiemsee) Annual cost savings > €10 million (considerable effects already in 2016; full effects from 2017 onwards) Restructuring costs for site optimisation (€17.1 million) digested in FY 2014 result Capex overco
Slide 6: Consolidation of activities in China
Consolidation of activities in China JV DEUTZ Dalian Consolidation of our Chinese activities and focus on € million Revenue (1) our successful JV DEUTZ Dalian, which has sufficient capacities DEUTZ Dalian (at-equity consolidated) increased its 359.8 revenue by 12.8% yoy and outperformed the 319.1 Ch
Slide 7: Emission standards drive DEUTZ revenue growth
Emission standards drive DEUTZ revenue growth Average sales price per engine (indexed; FY 2011 = 100) Tier 4 systems require exhaust 117 116 aftertreatment devices 100 104 Growing share of new emission engines drives revenue growth Effect was diluted by strong demand for smaller engine series in 201
Slide 8: DEUTZ engines for Tier 4 emission standard
DEUTZ engines for Tier 4 emission standard Competitive product features: compact size, low fuel consumption, smart exhaust after-treatment Successful combination of platform strategy with DEUTZ application expertise Full range offering with focus on engines for Mobile Machinery and Agricultural Mach
Slide 9: Stage V ready
Stage V ready 240 – 520 kW 160 – 291 kW 130 – 206 kW 85 – 115 kW 56 – 100 kW 37 – 56 kW TCD 2.9 to 7.8 litre engines with DPF already meet the next EU emission standard announced for 2019 DEUTZ technology platform offers our customers long-term planning certainty as they do not have to invest in ada
Slide 10: DEUTZ customer base
DEUTZ customer base Long standing customer relationships (not exhaustive) DEUTZ has a lot of long standing relationships with key customers Customer base extended and diversified with new emission engines New customers attracted by the compact design and smart New clients (not exhaustive) exhaust af
Slide 11: Successful business development
Successful business development Examples of new applications New customers gained in all regions, in particular with new engines 2.9 and 3.6 Greater share of wallet at existing clients New business related to different applications, e.g. tractors, fork lifts, telehandler, dumpers, rollers, wheel loa
Slide 12: Key applications
Key applications Typical Markets benefit from application macro trends Construction Material handling Mobile Machinery Ground support Mining equipment Tractors Agricultural Machinery Agricultural equipment Gensets Stationary Equipment Pumps Compressors Trucks Automotive Buses Rail vehicles Wide appl
Slide 13: Revenue split by application
Revenue split by application FY 2014 (FY 2013) Other 2% Mobile Machinery 47% €36.9 million €715.3 million Automotive 5% (€30.1 million) (€481.6 million) €82.0 million (€188.5 million) Stationary Equipment 12% €1,530.2 million €179.2 million (€1,453.2 million) (€173.7 million) Agricultural Machinery
Slide 14: Revenue split by region
Revenue split by region FY 2014 (FY 2013) Africa/Middle East 5% Europe (excl. Germany) 49% €84.7 million €744.7 million (€70.4 million) (€824.6 million) Asia-Pacific 7% €107.4 million (€107.2 million) €1,530.2 million (€1,453.2 million) Americas 17% €256.6 million (€190.6 million) Germany 22% €336.8
Slide 15: Service business
Service business € million 250.3 253.7 259.3 241.6 Strong resilience of profitable 215.8 service business through different economic cycles 175.0 Higher complexity of new emission engines provides opportunity to increase penetration of service business Active management of service network with train
Slide 16: Agenda
Agenda DEUTZ strategy & positioning Financials Outlook 16
Slide 17: Key figures
Key figures Q1 2015 Year-on-year € million Order intake 321.0 -22.5% Revenue 318.1 -7.2% EBITDA 33.9 +33.5% EBIT 10.1 +€8.2 million Net financial position 15.5 +€51.0 million Significant operating profit increase despite lower revenue 17
Slide 18: Sales figures
Sales figures Order intake Unit sales Revenue € million Units € million -22.5% -17.0% -7.2% 414.2 44,457 2,801 69.6 36,907 342.7 321.0 3,312 318.1 55.9 72.1 67.1 41,656 344.6 33,595 248.9 286.8 251.0 Q1 2014 Q1 2015 Q1 2014 Q1 2015 Q1 2014 Q1 2015 Decline of sales figures mainly caused by previous y
Slide 19: Revenue development
Revenue development € million 410.1 410.7 424.5 372.2 381.0 342.7 352.3 318.1 289.9 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Current business impacted by the emission change on 1 October 2014 in Europe 19
Slide 20: Revenue split
Revenue split Revenue split by application, Q1 2015 Revenue split by region, Q1 2015 (Q1 2014) (Q1 2014) Other 1% Mobile Machinery 42% Africa / Middle East 5% Europe (excl. Germany) 46% €3.5 million €134.6 million €19.3 million €145.3 million (€4.3 million) (€153.0 million) (€16.1 million) (€171.5 m
Slide 21: EBIT
EBIT(1) € million 10.1 1.9 11.0 7.1 4.0 -4.9 -4.9 -0.3 Q1 2014 Q1 2015 EBIT margin 0.6% 3.2% EBIT notably up by €8.2 million - both operating segments contributed to the profit improvement Substantial FX effects. Compensation of negative scale effects by higher service revenues as well as lower prod
Slide 22: Operating profit & net income
Operating profit & net income Q1 2014 Q1 2015 € million 33.9 23.8 25.4 23.5 10.1 1.1 1.3 7.7 1.9 1.7 0.8 -0.6 EBITDA D&A EBIT Net Income Net EBITDA D&A EBIT Net Income Net interest taxes income interest taxes income expense expense EBITDA increased by €8.5 million (+33.5% year-on-year) Net interest
Slide 23: R&D spending & capital expenditure
R&D spending & capital expenditure R&D Capital expenditure (excl. R&D) € million Gross expenditure 19.1 4.7 Reimbursements 13.7 2.8 8.2 8.5 Net expenditure 0.3 0.1 14.4 10.9 7.9 8.4 Net R&D Q1 2014 Q1 2015 Q1 2014 Q1 2015 expenditure ratio(1) 4.2% 3.4% After all engines designed for the latest emiss
Slide 24: Working capital & operating cash flow
Working capital & operating cash flow Working capital Operating cash flow € million 245.4 202.2 12.4 9.4 Working Q1 2014 Q1 2015 Q1 2014 Q1 2015 capital ratio (31 March) 13.4% 16.3% Working capital increased at the end of Q1 2015 Operating cash flow increased by €3.0 million Inventories raised by FX
Slide 25: Free cash flow generation & net financial position
Free cash flow generation & net financial position Free cash flow Net financial position € million 15.5 52.0 54.1 -35.5 2014 Q1 2015 (LTM) Q1 2014 Q1 2015 Free cash flow of last twelve months improved Net financial position improved by €51.0 million compared to the last quarter Free cash flow used t
Slide 26: Equity ratio & funding
Equity ratio & funding € million 1,149.2 1,195.6 44.5% 44.0% 511.0 526.5 208 15 15 8 2014 Q1 2015 up to up to up to up to 1 year 2 years 5 years 10 years Total assets Equity xx.x% Equity ratio Repayment schedule Duration of credit lines Sound balance sheet; equity ratio >40% Medium- to long-term fin
Slide 27: Segments: DEUTZ Compact Engines
Segments: DEUTZ Compact Engines Q1 Q1 Change € million 2015 2014 in % New orders 248.9 344.6 -27.8 Unit sales 33,595 41,656 -19.4 Revenue 251.0 268.8 -12.5 EBIT 4.0 -4.9 >100 Mixed growth dynamics: Revenue increased in Stationary Equipment (+34.8%) and Service (+7.7%). Revenue declined in Agricultur
Slide 28: Segments: DEUTZ Customised Solutions
Segments: DEUTZ Customised Solutions Q1 Q1 Change € million 2015 2014 in % New orders 72.1 69.6 3.6 Unit sales 3,312 2,801 18.2 Revenue 67.1 55.9 20.0 EBIT 11.0 7.1 54.9 All applications with strong growth momentum, e.g. Automotive (+26.4%), Stationary Equipment (+22.1%) and Mobile Machinery (+12.7%
Slide 29: Summary: key development
Summary: key development Demand impacted by prior year’s pre-buys Operating profit increase in both segments “Stage V ready”-campaign Focus of Chinese activities on DEUTZ Dalian Sound balance sheet 29
Slide 30: Agenda
Agenda DEUTZ strategy & positioning Financials Outlook 30
Slide 31: Financial outlook
Financial outlook FY 2014 reported Guidance FY 2015 € million Revenue 1,530.2 approx. -10 % EBIT margin (before one-offs) 2.1 % approx. 3 % Net R&D expenditure(1) 53.1 significant decline Capex (excl. R&D)(1) 40.3 ~ 50 (1) Net of reimbursements Group revenue expected to decline in FY 2015; slight re
Slide 32: Financial calendar & contact details
Financial calendar & contact details Interim report 1st half 2015 6 August 2015 Interim report 1st to 3rd quarter 2015 5 November 2015 Contact details Christian Krupp Tel:+49 (0) 221 822 5400 Ottostrasse 1 Fax:+49 (0) 221 822 15 5400 51149 Cologne (Porz-Eil) Email: krupp.c@deutz.com Germany www.deut
Slide 33: Disclaimer
Disclaimer Unless stated otherwise, all the figures given in this presentation refer to continuing operations. The details given in this document are based on the information available at the time it was prepared. This presents the risk that actual figures may differ from forward-looking statements.