Traton Se · XETR:8TRA
Traton — 9M 2020 Earnings Presentation
35 slides from Traton's earnings presentation, Nov 10, 2020
Slide 1: Press Conference Call – Interim Statement 9M 2020
PRESS CONFERENCE CALL – INTERIM STATEMENT 9M 2020 MATTHIAS GRÜNDLER, CEO CHRISTIAN SCHULZ, CFO MUNICH - NOVEMBER 10, 2020
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 TRATON GROUP in a
Slide 3: Your Presenters Today
PRESS CONFERENCE CALL INTERIM STATEMENT 9M 2020 – YOUR PRESENTERS TODAY Matthias Gründler Christian Schulz Julia Kroeber-Riel Chief Executive Officer Chief Financial Officer Head of Group Communications & Governmental Relations 3
Slide 4: Agenda
AGENDA 1. Challenging Environment 2020 2. Core KPIs 9M 2020 3. Going forward 4. Q&A 4
Slide 5: Overall Challenging Environment in 2020
OVERALL CHALLENGING ENVIRONMENT IN 2020 GLOBAL ECONOMY recovering from severe impact of COVID-19 POLITICAL ENVIRONMENT challenging and changing PEOPLE PLANET PERFORMANCE BUSINESS CLIMATE CHALLENGING COMPANY ENVIRONMENT downturn in transportation industry uncertainty in face of halted second wave of
Slide 6: Global Growth for 2020 Projected to Collapse; Recovery Expected 2021
DEEP DIVE GLOBAL ECONOMY GLOBAL GROWTH FOR 20201 IS PROJECTED TO COLLAPSE RECOVERY OF ECONOMIC ACTIVITIES EXPECTED IN 2021 WORLD ADVANCED ECONOMIES EMERGING MARKET & GDP forecast GDP forecast DEVELOPING ECONOMIES GDP forecast 6.4% 6.0% 5.2% 3.9% 3.3% 2021 2021 2021 1.6% 01/20 04/20 06/20 10/20 10/20
Slide 7: Good Political Measures for a Restart Are Discussed
DEEP DIVE POLITICAL ENVIRONMENT GOOD POLITICAL MEASURES FOR A RESTART ARE DISCUSSED – NOW IT IS TIME TO PUT THEM INTO PRACTICE EUROPEAN GREEN DEAL. CV industry needs political framework conditions NOW EUROPE HAS TO FOLLOW SUIT. EU recovery fund („Next Generation EU“) needs MARKET RAMP-UP ALTERNATIVE
Slide 8: Business Climate in the Transport Sector Still Challenging
DEEP DIVE BUSINESS CLIMATE BUSINESS CLIMATE IN THE TRANSPORT SECTOR STILL CHALLENGING… ROAD FREIGHT TRANSPORT & LOGISTICS 60 60 Business climate in both sectors 40 40 continues to be negative in Germany 20 20 13.9 Expectations 0 improved significantly 0 2017 2018 2019 2020 recently, in road 2017 201
Slide 9: …But Improved in Q3 2020
DEEP DIVE COMPANY ENVIRONMENT …BUT IMPROVED IN Q3 2020 Vehicle utilization in most regions especially in the long-haulage truck business with positive development. Market recovery evident, even faster than expected. Strong incoming orders in Q3 2020. TRATON GROUP UNIT SALES & INCOMING ORDERS (`000 u
Slide 10: Agenda
AGENDA 1. Challenging Environment 2020 2. Core KPIs 9M 2020 3. Going forward 4. Q&A 10
Slide 11: Snapshot TRATON – Product Highlights 2020
DEEP DIVE COMPANY ENVIRONMENT SNAPSHOT TRATON - PRODUCT HIGHLIGHTS 2020 Despite the challenging environment we continued to set product highlights October September September September VWCO to deliver first 100 Scania introduces Scania introduces New VWCO heavy-duty e-trucks to Ambev in 2021 new V8
Slide 12: Snapshot TRATON Group Core KPIs 9M 2020
DEEP DIVE COMPANY ENVIRONMENT SNAPSHOT TRATON GROUP CORE KPIS 9M 2020 9M 2020 9M 2019 Change Trucks and buses (units) Incoming orders 145,933 169,708 -14% Book to bill1 (ratio in units) 1.14 0.95 +0.19 bp Unit sales 127,660 179,091 -29% of which trucks2 115,820 163,316 -29% of which buses 11,840 15,
Slide 13: Deep Dive Core KPIs 9M 2020
DEEP DIVE COMPANY ENVIRONMENT DEEP DIVE CORE KPIS 9M 2020 9M 2020 9M 2019 Change Industrial Business (€ million) Sales revenue 15,419 19,491 -21% Operating profit -140 1,377 -1,517 Operating RoS (in %) -0.9 7.1 -8.0 pp Capital expenditures1 602 569 6% Primary R&D costs 796 982 -19% Net cash flow -14
Slide 14: Scania Vehicles & Services – Core KPIs 9M 2020
DEEP DIVE COMPANY ENVIRONMENT SCANIA VEHICLES & SERVICES – CORE KPIS 9M 2020 9M 2020 9M 2019 Change Trucks and buses (units) Incoming orders 60,207 66,581 -10% Unit sales 47,735 74,720 -36% of which trucks 43,443 68,996 -37% of which buses 4,292 5,724 -25% Financial key performance indicators (€ mil
Slide 15: MAN Truck & Bus – Core KPIs 9M 2020
DEEP DIVE COMPANY ENVIRONMENT MAN TRUCK & BUS – CORE KPIS 9M 2020 9M 2020 9M 2019 Change Trucks and buses (units) Incoming orders 59,745 75,712 -21% Unit sales 53,543 76,510 -30% of which trucks1 50,166 71,647 -30% of which buses 3,377 4,863 -31% Financial key performance indicators (€ million) Sale
Slide 16: Volkswagen Caminhões e Ônibus – Core KPIs 9M 2020
DEEP DIVE COMPANY ENVIRONMENT VOLKSWAGEN CAMINHÕES E ÔNIBUS – CORE KPIS 9M 2020 9M 2020 9M 2019 Change Trucks and buses (units) Incoming orders 26,287 30,453 -14% Unit sales 26,772 31,551 -15% of which trucks 22,561 26,177 -14% of which buses 4,211 5,374 -22% Financial key performance indicators (€
Slide 17: Truck Market Forecasts (>6t, k units)
DEEP DIVE COMPANY ENVIRONMENT TRUCK MARKET FORECASTS (˃ 6T, K UNITS) EU27+31 372 375 SOUTH AMERICA 126 143 2020e2: -30% – -35% Expected by market researchers 2009 2011 2013 2015 2017 2019 2009 2011 2013 2015 2017 2019 2020e2: GERMANY BRAZIL 84 87 -10% – -20% Expected by market researchers 96 72 2009
Slide 18: Outlook 2020: Market Weakness Leads to Sharp Decline in Unit Sales
DEEP DIVE COMPANY ENVIRONMENT OUTLOOK 2020: MARKET WEAKNESS LEADS TO SHARP DECLINE IN UNIT SALES FY 2018 FY 2019 2020 Outlook Unit sales 233.0 k 242.2 k Sharp decline (Units; Growth in %) +14% +4% Group sales revenue €25.9 bn €26.9 bn Substantial decline (in €bn; Growth in %) +6% +4% Group return on
Slide 19: Agenda
AGENDA 1. Challenging Environment 2020 2. Core KPIs 9M 2020 3. Going forward 4. Q&A 19
Slide 20: We Set Focus Areas on Our Way to a Global Champion
WE SET FOCUS AREAS ON OUR WAY TO A GLOBAL CHAMPION TRATON HOLDING STABILIZING OPERATING BUSINESS GLOBAL EXPANSION FOCUS AREAS CUSTOMER-FOCUSED INNOVATIONS BRAND PERFORMANCE 20
Slide 21: Focus on Securing Liquidity in Uncertain Times
STABILIZING OPERATING BUSINESS FOCUS ON SECURING LIQUIDITY IN UNCERTAIN TIMES PRODUCTION CAPACITY COST & EXPENSE MANAGEMENT SECURING LIQUIDITY LIQUIDITY RESERVE €7.7 BILLION 21
Slide 22: Brands Have Filled Product Pipelines with Technology for the Future
CUSTOMER-FOCUSED INNOVATIONS OUR BRANDS HAVE FILLED THEIR PRODUCT PIPELINES WITH TECHNOLOGY FOR THE FUTURE BUDGET SHIFT TO E-MOBILITY MAN E-TGM SCANIA E-TRUCKS VWCO E-TRUCK NETWORK SCANIA ELECTRIC CITY BUSES MAN ELECTRIC CITY BUSES 22
Slide 23: Product Development Funds Will Be Shifted to E-Mobility
CUSTOMER-FOCUSED INNOVATIONS PRODUCT DEVELOPMENT FUNDS WILL BE SHIFTED TO E-MOBILITY 36% Percentage of Product Development for e-mobility will be doubled until 2025 18% All brands are reducing budgets for conventional drives and PD shift to e-mobility PD 2025 2020 TRATON invests €1 billion 32% until
Slide 24: Brands Strengthen Performance to Safeguard Targeted RoS of 9%
BRAND PERFORMANCE BRANDS STRENGTHEN PERFORMANCE TO SAFEGUARD TARGETED RoS OF 9% OVER THE CYCLE TARGETED RoS 9% REALIGNMENT MAN SCANIA PROGRAM IMPROVING EARNINGS QUALITY 24
Slide 25: TRATON's Global Footprint Is Growing
GLOBAL EXPANSION TRATON’S GLOBAL FOOTPRINT IS GROWING ACQUISITION NAVISTAR ADDRESSING PROFIT POOLS E-MOBILITY JOINT VENTURE HINO TUSIMPLE PARTNERSHIP 25
Slide 26: Navistar International at a Glance
GLOBAL EXPANSION NAVISTAR INTERNATIONAL AT A GLANCE in US market Revenue EBIT1 for Trucks USD~11.25 bn USD~689 mn History since 1831 Dealers > 1,200 Employees~13,300 Source: Company information, figures for FY 2019 as of October 31, 2019. 1 Adjusted EBIT: Calculated as adjusted EBITDA –depreciation
Slide 27: Transaction Overview
GLOBAL EXPANSION TRANSACTION OVERVIEW • No 4 in US market for trucks; long history since 1831 NAVISTAR AT A GLANCE • Revenue of USD11.25 bn and adjusted EBIT of USD689 mn in fiscal year 20191 • More than 1,200 dealers • Access more than 75% of global truck market profit pools ACQUISITION RATIONALE •
Slide 28: Good Reasons for Navistar Acquisition
GLOBAL EXPANSION GOOD REASONS FOR NAVISTAR ACQUISITION Highly complementary geographic footprint with no product portfolio cannibalization Additional scale for TRATON technology (e.g., powertrain, electrification, autonomous) Proven by long-standing strategic partnership North America at the forefro
Slide 29: Access More Than 75% of Global Truck Market Profit Pools
GLOBAL EXPANSION ACCESS MORE THAN 75% OF GLOBAL TRUCK MARKET PROFIT POOLS1 ACCESS TO ATTRACTIVE NORTH AMERICAN MARKET Europe/ NAFTA Russia ~35% ~35% CREATING A GLOBAL CHAMPION LEADER IN PROFITABILITY | GLOBAL PRESENCE | INNOVATION Asia/MEA Export ~25% business Latin CUSTOMER BRAND COOPERATION GLOBAL
Slide 30: Status and Next Steps
GLOBAL EXPANSION STATUS AND NEXT STEPS Signing and announcement of merger agreement on November 7, 2020 Navistar shareholder approval expected in Q1 2021 (50% + required) Regulatory approvals expected in H1 2021 Closing expected mid 2021 De-listing of Navistar shortly after closing 30
Slide 31: TRATON and Hino Start E-Mobility Joint Venture
GLOBAL EXPANSION TRATON AND HINO START E-MOBILITY JOINT VENTURE TRATON and Hino have signed a joint venture agreement to plan and provide e-mobility products This follows the procurement joint venture established in 2019 Development includes: • electric vehicles including battery electric vehicles (
Slide 32: Partnership with TuSimple in Autonomous Trucking
GLOBAL EXPANSION PARTNERSHIP WITH TU SIMPLE IN AUTONOMOUS TRUCKING TRATON and TuSimple entered into a global partnership to develop autonomous trucks Scania test vehicles will soon be on the road with TuSimple technology in Sweden The first test vehicles underway are aiming for Level 4 (high automat
Slide 33: Agenda
AGENDA 1. Challenging Environment 2020 2. Core KPIs 9M 2020 3. Going forward 4. Q&A 33
Slide 34: Contacts Group Communications
CONTACTS GROUP COMMUNICATIONS Julia Kroeber-Riel Sacha Klingner Matthias Karpstein Head of Group Communications & Head of Corporate Communications Business Media Relations Governmental Relations julia.kroeber-riel@traton.com sacha.klingner@traton.com matthias.karpstein@traton.com TRATON SE Dachauer
Slide 35: Press Conference Call – Interim Statement 9M 2020
PRESS CONFERENCE CALL – INTERIM STATEMENT 9M 2020 MATTHIAS GRÜNDLER, CEO CHRISTIAN SCHULZ, CFO MUNICH - NOVEMBER 10, 2020