Slide 1: Results Presentation 1H2021
Results Presentation 1H2021 27 July 2021
Slide 2: Table of contents
Table of contents 1. Key Highlights 2. Other materials I. Business performance II. Financial results ANNEX 1
Slide 3: Key Highlights of First Half 2021
Key Highlights of First Half 2021 Health and Safety: Fight against Strategy: Strategic Plan 8.69 AFI2 COVID-19: 2022-26 in 2H2021 0.19 ASI3 Strong measures maintained Shareholders: Labour: Remuneration Agreement for 5 Program for 2022 IV. Outlook I. Workforce years period linked update management to
Slide 4: I. Workforce management
I. Workforce management ▪ Health & Safety model continuously optimized with the objective to minimize accidents in the business activity. ▪ Strong measures in place for the prevention and ORP1 main figures 1H2021 protection of employees in the fight against COVID-19. 2019 2020 1H2021 ✓ Accident Freq
Slide 5: II. Business performance (I/II)
II. Business performance (I/II) ▪ Reinforced organization in both execution and Main figures 1H2021 commercial teams. ▪ Improved lean manufacturing model to increase efficiency and productivity. ✓ Maint. activity Spain: >65%2 ▪ Recovery of maintenance in all markets as mobility ✓ Maint. activity Int
Slide 6: II. Business performance (II/II)
II. Business performance (II/II) ▪ Strengthened backlog to reach 238 €m, increased Main figures 1H2021 to 462 €m including awards yet to be signed. o Manufacturing and maintenance of 13 VHS locomotives for Spain. ✓ Order intake: 238 €m (462 €m o Maintenance services for VHS trains in Spain. includin
Slide 7: III. Financial results – P&L
III. Financial results – P&L Main figures 1H2021 ▪ Revenues increased driven by manufacturing activity and supported by recovery of maintenance services. ▪ Cost-cutting measures with the objective of reducing ✓ Revenues reached historical highs by 15% the overhead expenses in the period 2021-22. ✓ O
Slide 8: III. Financial results – Balance Sheet (I/II)
III. Financial results – Balance Sheet (I/II) Main figures 1H2021 ▪ Stabilized Working Capital in 1H2021. ▪ Working Capital management to maximize cash generation through optimization of receivables, ✓ Working Capital: 173 €m payables and inventory turnover. 31% over revenues ▪ Action plan under imp
Slide 9: III. Financial results – Balance Sheet (II/II)
III. Financial results – Balance Sheet (II/II) Main figures 1H2021 ▪ Financial debt renegotiated to: ✓ Net Debt1: 68 €m (1.4x Adj. EBITDA) o Extend maturity (from 3.12 to 3.74 years in - Avg. debt cost: 1.0% 1H2021). - Avg. debt maturity: 3.7 years o Reduce average cost (from 1.61% to 1.04% - Debt m
Slide 10: IV - Outlook update
IV - Outlook update Profitability ✓ Adjusted EBITDA in FY2021: 11-12% ✓ Working Capital in 2021: Contained cash Capital structure consumption supported by WC Action Plan. ✓ Net Debt in 2021: 1.2 – 1.5x Adjusted EBITDA New ✓ Capex in 2021: c. 25 €m Business ✓ Backlog execution in 2021-2022: 35-37% pe
Slide 11: Table of contents
Table of contents 1. Key Highlights 2. Other materials I. Business performance II. Financial results ANNEX 10
Slide 12: Commercial activity
Commercial activity Order intake 2019-1H2021 (€m) ▪ During 1H 2021, order intake amounted to 238 €m, including mainly maintenance scope for 15 additional LTM2 Book- to-bill ratio 2.8x 0.8x 0.8x Spain VHS trains currently under manufacturing, and 1,134 impact of price update in Saudi maintenance cont
Slide 13: Backlog breakdown
Backlog breakdown Backlog 1H2021 (€m) (2) Manufacturing LTM times3 6.5x 5.6x 6.0x Revenues 0.8 €bn (26%) (1) 224 3,355 3,184 3,131 Maintenance 3.1 €bn 2.2 €bn (69%) Pending to be signed in 1H 2021 Remodelling 0.1 €bn (4%) 2020 1H2021 jul-2021 ▪ Talgo’s backlog is the result of a selective commercial
Slide 14: Manufacturing projects – High Speed
Manufacturing projects – High Speed Backlog 1H2021 (€m) Renfe Avril VHS (Spain)(2) ▪ Project scope – 900 €bn1: Manufacturing o Manufacture of 30 VHS “Avril” trains. 0.8 €bn (26%) o Maintenance for a period of 30 years. ▪ Project execution: o In last manufacturing phases and already 3.1 €bn under tes
Slide 15: Manufacturing projects – Long distance / Passenger coaches
Manufacturing projects – Long distance / Passenger coaches Backlog 1H2021 (€m) DB Talgo 230 km/h (Germany) ▪ Project scope – 550 €m (2.3 €bn)1: Manufacturing o Framework contract for the manufacture of up to 0.8 €bn (26%) 100 Talgo 230 trains. o Initial order for the manufacture of 23 trains. o Main
Slide 16: Light maintenance projects
Light maintenance projects Backlog 1H2021 (€m) Fleet maintained in # of units(1) 3,586 2,812 2,452 3.1 €bn Maintenance + 360 units 2.2 €bn (69%) + 2.3% CAGR 2015 1H2021 2023E ▪ Maintenance activity remained strongly impacted during the first months of 2021. ▪ However, services started to progressive
Slide 17: Overhaul / heavy maintenance projects
Overhaul / heavy maintenance projects Backlog 1H2021 (€m) Conversion of night trains into VHS (España) ▪ Project scope – 107 €m: Overhaul o Conversion of Talgo S7 compositions(1). 0.1 €bn (4%) o The initial project includes 156 coaches (13 compositions) with an option for additional 72 coaches (6 co
Slide 18: Table of contents
Table of contents 1. Key Highlights 2. Other materials I. Business performance II. Financial results ANNEX 17
Slide 19: Profit & loss – Revenues
Profit & loss – Revenues Cumulative revenues - YoY (€m) Quarterly revenues (€m) COVID Recovery +35% Stability Impact 293.3 147.7 147.1 146.2 216.6 126.2 122.7 112.8 103.8 1H2020 1H2021 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 ▪ Revenues increased mainly driven by the following: o Manufacturing activity le
Slide 20: Profit & loss – EBITDA and Net Profit
Profit & loss – EBITDA and Net Profit Adjusted EBITDA(1) (€m) and margin (%) Adjusted Net Profit (€m) 12 11.0 35 30.5 10 30 8 25 6 14.7 4 20 10.4% 2 (5.3) 15 10 6.8% 0 -2 5 -4 0 -6 1H2020 1H2021 -8 Adjusted EBITDA Adj. EBITDA margin 1H2020 1H2021 ▪ Adjusted EBITDA(1) amounted to 30.5 €m in 1H2021 dr
Slide 21: Balance Sheet – Working Capital
Balance Sheet – Working Capital ▪ The Working Capital increased to reach 172.7 €m in 1H2021 as expected, driven by the industrial cycle of the manufacturing projects underway. ▪ Working Capital remained at 31% over LTM Revenues as a result of the implementation of a Working Capital Improvement Actio
Slide 22: Balance Sheet – Net Financial Debt
Balance Sheet – Net Financial Debt Net Financial Debt (€m)(1) LT bank debt – Repayment schedule (€m) NFD / LTM Adjusted 1.4x 1.4x 109 EBTIDA 88 67.8 48.1 52 20 11 FY2020 1H2021 2H2021 2022 2023 2024 >2025 Financial debt breakdown (€m) ▪ Increased average debt maturity from 3.12 to €m 1H2021 3.74 yea
Slide 23: Cash Flow – Free Cash Flow
Cash Flow – Free Cash Flow ▪ EBITDA increase in the period was offset by Working Capital requirements due to the increased industrial activity, resulting on a negative Free Cash Flow of -9.2 €m in 1H2021. ▪ Capex for the period amounted to 11.9 €m, in line with forecast at the beginning of the year
Slide 24: Table of contents
Table of contents 1. Key Highlights 2. Other materials I. Business performance II. Financial results ANNEX 23
Slide 25: Annex 1. P&L
Annex 1. P&L Profit & Loss Account (€m) 1H21 1H20 % Change Total net turnover 293.3 216.6 35.4% Other income 7.5 4.5 68.3% Procurement costs (180.2) (124.3) 45.0% Employee welfare expenses (70.2) (59.0) 18.9% Other operating expenses (22.1) (25.9) (14.8%) EBITDA 28.3 11.8 139.6% % Ebitda margin 9.7%
Slide 26: Annex 2. Balance sheet
Annex 2. Balance sheet Balance Sheet (€m) June 2021 June 2020 Dec 2020 FIXED ASSETS 258.0 248.0 257.0 Tangible + intangible assets 118.1 105.2 115.2 Goodwill 112.4 112.4 112.4 Other long term assets 27.5 30.4 29.3 CURRENT ASSETS 686.2 617.7 645.9 Inventories 150.7 157.3 145.3 Non- current assets hel
Slide 27: Annex 2. Balance sheet (2)
Annex 2. Balance sheet (2) Financial debt (€m) June 2021 June 2020 Dec 2020 Long term financial liabilities 259.3 217.6 238.4 Short term financial liabilities 21.3 49.0 41.1 Financial leasings 5.4 1.5 6.9 Cash & cash equivalents (218.2) (291.1) (238.3) Net financial debt 67.8 (23.1) 48.1 Adjusted EB
Slide 28: Annex 3. Cash flow statement
Annex 3. Cash flow statement Cash flow statement (€m) 1H21 1H20 % Change 2020 Net income 10.2 (5.7) (278.0%) (17.4) Corporate income tax 5.0 3.7 37.7% 5.1 Depreciation & Amortization 9.1 8.1 12.3% 16.7 Financial income/Financial expenses 4.7 3.1 54.1% 6.2 Other result adjustments 0.4 0.1 341.1% 14.2
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