Autoliv, Inc. · NYSE:ALV

Autoliv — Q4 2009 Earnings Presentation

22 slides from Autoliv's earnings presentation, Jan 29, 2010

  1. Slide 1: Teleconference: 4th Quarter Financial Earnings

    Teleconference 4th Quarter Financial Earnings January 29, 2010 Copyright Autoliv Inc., All Rights Reserved

  2. Slide 2: Safe Harbor Statement

    Safe Harbor Statement * This report contains statements that are not historical facts but rather forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (PSLRA). All such statements are based upon our current expectations and various assumptions, and app

  3. Slide 3: Staying Ahead of the Curve with our Strategy Execution

    Staying Ahead of the Curve - with our Strategy Execution ƒ Growth ¾ Market Share gains 9 Acquisition of Delphi OPS 9 Outperformed LVP globally and the TRIAD 9 Strong platform mix ¾ Innovations in “Small Car” and “Active” Safety ¾ Expansion in Asia ƒ Financial Leadership ¾ Superior cash flow ¾ Margin

  4. Slide 4: Q4'09 Overview

    Q4’09 Overview - organic sales and margin improvement continues ƒ Organic sales up 26% ƒ Gross profit margin 20.4% ƒ EBIT margin* 10.8% exceeds guidance ƒ Free cash flow* exceeds $200M ƒ EPS* $1.39 (*) Free Cash flow (After CapEx, net), Non-US GAAP, Including restructuring 2009 & 2008 EBIT Margin 6.

  5. Slide 5: Cash Flow

    Cash Flow (US $ Millions) 2009 2008 2009 2008 2007 2006 Q4 Q4 FY FY FY FY Net Income 64 (38) 13 172 296 423 Depreciation & Amortization 87 90 314 347 321 303 Other non-cash items (46) 39 (42) 21 (5) (9) Change in operating WC 145 96 207 73 169 (157) Cash from operations 250 187 492 613 781 560 CapEx

  6. Slide 6: Financial Position

    Financial Position - Net Debt to Capitalization 21% 40 30 20 Internal Debt Policy LTM Policy Expected Compliance 10 Leverage Ratio 1.6 < 3 times 9 Interest Coverage 1.5 > 2.75 times Q1’10 0 % 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 $533 million net debt reduction during 2009` ALV Q4 2

  7. Slide 7: Light Vehicle Production - 4th Quarter Actual

    Light Vehicle Production - 4th Quarter Actual Units in millions 2009 2008 Chg NAFTA 2.7 2.7 1% - Domestic (*) 1.5 1.6 (6%) - New Domestic 1.2 1.1 13% ~ 7% Europe 4.5 4.0 10% - WEU 3.2 2.8 13% - EEU 1.3 1.2 3% Japan 2.3 2.4 (3%) Total Triad 9.5 9.1 4% Rest of World 7.2 5.0 45% Total Global 16.7 14.1

  8. Slide 8: Autoliv Production - Current Quarter

    Autoliv Production - Current Quarter Units in Millions Q4’09 Q4 Chg. vs.’08 Seatbelts 27.1 24% - Pretensioners (where of) 10.7 21% Frontal airbags (excl. knee) 6.1 34% Side Airbags - Chest (Thorax) 5.7 26% - Head (Curtain) 6.7 37% Steering Wheels 2.3 19% Electronic Control Units 2.4 44% - LVP* TRIAD

  9. Slide 9: Gross Margin

    Gross Margin 25.0 19.7 20.5 20.4 19.6 19.5 20.0 15.0 11.9 Q4 ‘09 vs. ‘08 10.0 ƒ Sales effect 340 bps ƒ Commodity 180 bps ƒ Labor savings 180 bps ƒ Other (net) 150 bps 5.0 Gross margin effect 850 bps 0.0 % 2004 2005 2006 2007 2008 2009 YoY improvement better than organic sales increase effect ALV Q4

  10. Slide 10: Operating Margin

    Operating Margin - strong margin recovery on 26% organic sales increase 12.0 10.8 8.6 9.3 8.5 9.2 8.0 6.6 4.0 1.1 0.0 2004 2005 2006 ** 2007 2008* 2009* -2.3 Q4 ‘09 vs. ‘08 -4.0 ƒ Gross profit 850 bps % ƒ Sales effect 310 bps ƒ RDE & SGA savings 90 bps -8.0 ƒ Engineering Income (120 bps) ƒ Other (ne

  11. Slide 11: Action Program & Other Restructuring Activities

    Action Program & Other Restructuring Activities - Summary 2008 2009 (US$ Mil’s unless otherwise specified) Plan Actual Q4 FY Cost $75 $74 $71 $133 Cash outlay $18 $26 $85 Savings $120 ~ $29 ~ $53 ~ $243 whereof margin improving ~ $41 ~ $134 Total associates affected, net 3,000 ~ 5,900 ~(300) ~ 6,900

  12. Slide 12: Associate change by Category

    Associate change* by Category - Q2’08 thru Q4’09 chg. chg. 0 vs. Q2’08 vs. Q3’09` -2,000 Indirect (2,874) (223) Direct (4,039) + 509 -4,000 -6,000 -8,000 0 -2,000 LCC (1,921) + 525 -4,000 HCC (4,992) (239) -6,000 2,000 0 -2,000 Temporaries + 167 + 1,267 -4,000 Employees (7,080) (981) -6,000 -8,000 Q

  13. Slide 13: Commodity Price Trends

    Commodity Price Trends Steel Index (MEPS) 300 250 200 Index 150 Aluminum (LME) 100 50 0 Jan-2004 Jan-2005 Jan-2006 Jan-2007 Jan-2008 Jan-2009 Commodity (US$ Mil’s) Q1 Q2 Q3 Q4 FY09 Magnessium (LME) Steel 7 3 (17) (20) (27) Zinc (2) (1) (1) 0 (4) Aluminum (2) (2) (5) (3) (12) Magnesium 0 (2) (4) (4)

  14. Slide 14: FY'09 Overview - Strong recovery throughout 2009

    FY’09 Overview - Strong recovery throughout 2009 FY (US $ Mil’s unless specified) Q1 Q2 Q3 Q4 Global LVP Chg - 35% - 24% - 5% + 18% Sales Chg (organic) - 40% - 28% - 12% + 26% EBIT Margin** - 7.8% 1.7% 5.6% 10.8% Free Cash Flow* - $43 $95 $102 $209 (*) Free Cash flow (After CapEx, net) (**) Non-US G

  15. Slide 15: FY'09 Overview - Action program mitigated margin effect

    FY’09 Overview - Action program mitigated margin effect of lower volumes ƒ Sales decline $1.4B ƒ Gross margin decline only 80 bps ƒ Stronger Cash Flow FY (US $ Mil’s unless specified) 2009 2008 Sales $5,121 $6,473 Gross Margin 16.6% 17.4% EBIT** $202 $387 EPS** $1.26 $3.04 Free Cash Flow* $362 $334

  16. Slide 16: Recent Expansion in Asia

    Recent Expansion in Asia ƒ Acquisition of remaining shares in Japanese JV ƒ $10 million investment in Japan ¾Expand technical and sales center ¾Consolidate manufacturing ƒ Acquistion of Delphi OPS business in Asia* (*) Transaction expected to close Q1 2010 ALV Q4 2009 Earnings Teleconference - 16 Co

  17. Slide 17: Acquisitions - Delphi Occupant Protection Systems (OPS)

    Acquisitions - Delphi Occupant Protection Systems (OPS) ƒ 2010 Annualized Sales ~ $400M (EU, North America, Asia) Customers Other - Asia Products Daimler 3% Other 7% GM 15% Ford 25% 3% Seatbelts 18% Hyundai Kia Airbags 62% Steering 55% Wheels 12% ƒ Production ¾ Asian airbag and seatbelt business in

  18. Slide 18: Light Vehicle Production - Full Year

    Light Vehicle Production - Full Year Units in Mil’s 2007 2008 2009 2010 Chg. vs.. ’09 NAFTA 15.1 12.6 8.6 10.8 27% - Domestic* 9.5 7.6 4.8 6.0 26% - New Domestic 5.6 5.0 3.8 4.8 27% ~ 10% Europe 22.1 20.9 16.5 16.2 (1%) - WEU 16.1 14.6 11.8 11.5 (3%) - EEU 6.0 6.3 4.7 4.7 4% Japan 10.8 10.7 7.5 8.6

  19. Slide 19: Light Vehicle Production - Global 2008-2010 by quarter

    Light Vehicle Production - Global 2008 – 2010 by quarter Millions EU & NAFTA ROW & Japan 18.0 12.0 ` 6.0 0.0 Q1 Q3 Q1 Q3 Q1 Q3 2008 2009 2010 Source: CSM @ January 18, 2010 ALV Q4 2009 Earnings Teleconference - 19 Copyright Autoliv Inc., All Rights Reserved

  20. Slide 20: Light Vehicle Production - 1st Quarter Outlook

    Light Vehicle Production - 1st Quarter Outlook Units in millions 2010 2009 Chg NAFTA 2.8 1.7 62% - Domestic* 1.6 1.0 57% - New Domestic 1.2 0.7 69% ~ 39% Europe 4.2 3.4 23% - WEU 3.0 2.5 22% - EEU 1.2 0.9 25% Japan 2.3 1.5 51% Total Triad 9.3 6.6 39% Rest of World 6.3 5.0 28% Total Global 15.6 11.6

  21. Slide 21: Financial Outlook

    Financial Outlook* Sales Q1 2010 FY2010 Organic > 50% 10 - 15% Reporting cut-off ~ 8% N /A Acquisitions ~ 3% 2 - 3% Fx ~ 8% ~ 3% Consolidated > 70% 15 - 20% EBIT Margin ~ 8.5% 8 - 9% (*) Excludes pending Delphi Asia acquisition, FX based on Year End December 2009 rates, CSM Forecast @ January 18, 20

  22. Slide 22: Thank you!

    Thank you! Autoliv Every year, Autoliv’s products save over 20,000 lives The Worldwide leader in Automotive Safety Systems Driven for life ALV Q4 2009 Earnings Teleconference - 22 Copyright Autoliv Inc., All Rights Reserved

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