Deutz Ag · XETR:DEZ
Deutz — H1 2015 Earnings Presentation
32 slides from Deutz's earnings presentation, Aug 6, 2015
Slide 1: H1 2015 results
H1 2015 results 6 August 2015 Dr Helmut Leube, CEO Dr Margarete Haase, CFO
Slide 2: Agenda
Agenda Review H1 2015 Outlook Annex H1 2015 results 6 August 2015 2
Slide 3: Key figures
Key figures H1 2015 yoy Q2 2015 qoq € million Order intake 670.7 -10.2% 349.7 +8.9% Revenue 670.2 -11.0% 352.1 +10.7% EBITDA (before one-offs) 70.4 +4.3% 36.5 +7.7% EBIT (before one-offs) 20.3 +1.0% 10.2 +1.0% Net income 16.7 > 100% 9.0 +16.9% Free cash flow 26.2 +€17.3 million 27.3 +€28.4 million P
Slide 4: End markets remain challenging
End markets remain challenging Unit sales assumptions FY 2015 Construction equipment Europe sideways North America sideways China more than -30% Agricultural Machinery Europe -5% to -10% Automotive China more than -10% Pre-buys in 2014 will lead to lower demand of European customers in the current y
Slide 5: Highlights
Highlights Revenue decrease in H1 in line with financial outlook Negative scale effects in H1 fully compensated New service marketing approach takes effect Implementation of site optimisation measures in Germany on schedule Focus of our Chinese production activities on JV DEUTZ Dalian Agreement to s
Slide 6: Sales figures
Sales figures Order intake Unit sales Revenue € million Units € million -10.2% -21.2% -11.0% 746.8 99,079 753.4 670.7 6,144 118.8 670.2 134.7 78,120 140.7 141.9 6,767 92,935 634.6 612.1 530.0 71,353 528.3 H1 2014 H1 2015 H1 2014 H1 2015 H1 2014 H1 2015 Sales figures decline due to previous year’s pr
Slide 7: Revenue development
Revenue development € million 410.1 410.7 424.5 372.2 381.0 342.7 352.3 352.1 318.1 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Current business impacted by emission level change on 1 October 2014 in Europe Sequential revenue increase in Q2 but 3 weeks plant holidays in Cologne in Q3 H1 20
Slide 8: Revenue split by region
Revenue split by region H1 2015 (H1 2014) Africa/Middle East 6 % Europe (excl. Germany) 47 % €43.1 million €314.5 million (€33.8 million) (€368.8 million) Asia-Pacific 10 % €65.1 million (€51.3 million) €670.2 million (€753.4 million) Americas 25 % Germany 12 % €164.4 million €83.1 million (€125.9 m
Slide 9: Revenue split by application
Revenue split by application H1 2015 (H1 2014) Other 1 % Mobile Machinery 44 % €9.8 million €291.4 million Automotive 7 % (€8.4 million) (€352.2 million) €46.6 million (€43.6 million) Agricultural Machinery 12 % €670.2 million €82.0 million (€753.4 million) (€140.9 million) Stationary Equipment 15 %
Slide 10: EBIT (before one-offs)
EBIT (before one-offs) € million 20.1 20.3 14.3 17.3 10.1 10.2 11.0 6.3 0.2 5.6 6.5 2.5 1.4 4.0 -3.5 -4.9 H1 2014 H1 2015 Q1 2015 Q2 2015 EBIT margin 2.7% 3.0% 3.2% 2.9% EBIT in H1 on the previous year’s level; margin in-line with full year outlook EBIT improved at both operating segments in H1 Segm
Slide 11: Operating profit & net income
Operating profit & net income H1 2014 H1 2015 € million 67.5 70.4 50.1 47.4 20.1 13.9 20.3 0.0 20.3 2.1 1.5 16.7 6.2 3.3 0.2 2.7 EBITDA D&A EBIT Restruc- EBIT Interest Income Net EBITDA D&A EBIT Restruc- EBIT Interest Income Net before before turing after expenses taxes income before before turing a
Slide 12: R&D & capital expenditure
R&D & capital expenditure R&D Capital expenditure (excl. R&D) € million Gross expenditure 36.2 10.5 Reimbursements 23.3 25.5 0.2 Net expenditure 3.5 19.9 0.9 25.7 25.3 19.8 19.0 Net R&D H1 2014 H1 2015 H1 2014 H1 2015 expenditure ratio(1) 3.4% 3.0% R&D scaled back significantly after all engines Cap
Slide 13: Working capital & operating cash flow
Working capital & operating cash flow Working capital Operating cash flow € million 216.4 204.0 53.9 40.9 Working H1 2014 H1 2015 H1 2014 H1 2015 capital ratio (30 June) 13.2% 15.0% Working capital increase (+6.1%) related to Significant increase of operating cash flow temporarily higher inventories
Slide 14: Free cash flow generation & net financial position
Free cash flow generation & net financial position Free cash flow(1) Net financial position € million 33.2 69.3 52.0 -31.8 2014 H1 2015 (LTM) H1 2014 H1 2015 Strong free cash flow performance continued Marked improvement of net financial position Free cash flow in H1 2015 amounted to €26.2 (+€65.0 m
Slide 15: Equity ratio & funding
Equity ratio & funding € million 1,149.2 1,179.8 44.5% 45.4% 511.0 535.1 208 15 15 5 2014 H1 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 increased to 45.4% Medium- to
Slide 16: Segments: DEUTZ Compact Engines
Segments: DEUTZ Compact Engines H1 H1 Change Q2 Q1 Change € million 2015 2014 in % € million 2015 2015 in % New orders 530.0 612.1 -13.4 New orders 281.1 248.9 12.9 Unit sales 71,353 92,935 -23.2 Unit sales 37,758 33,595 12.4 Revenue 528.3 634.6 -16.8 Revenue 277.3 251.0 10.5 EBIT (before one-offs)
Slide 17: Segments: DEUTZ Customised Solutions
Segments: DEUTZ Customised Solutions H1 H1 Change Q2 Q1 Change € million 2015 2014 in % € million 2015 2015 in % New orders 140.7 134.7 4.5 New orders 68.6 72.1 -4.9 Unit sales 6,767 6,144 10.1 Unit sales 3,455 3,312 4.3 Revenue 141.9 118.8 19.4 Revenue 74.8 67.1 11.5 EBIT (before one-offs) 17.3 14.
Slide 18: Summary
Summary Sales figures impacted by prior year’s pre-buys EBIT improvement despite negative scale effects Focus Chinese production activities on DEUTZ Dalian Site optimisation in Germany on schedule Strong cash flow generation H1 2015 results 6 August 2015 18
Slide 19: Agenda
Agenda Review H1 2015 Outlook Annex H1 2015 results 6 August 2015 19
Slide 20: 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 21: Agenda
Agenda Review H1 2015 Outlook Annex H1 2015 results 6 August 2015 21
Slide 22: Summary of key financials (I)
Summary of key financials (I) € million H1 2015 H1 2014 Change (%) Revenue 670.2 753.4 -11.0 EBITDA (before one-offs) 70.4 67.5 4.3 EBIT (before one-offs) 20.3 20.1 1.0 EBIT margin (%) 3.0 2.7 -- Net income 16.7 2.7 >100 Basic earnings per share (€) 0.14 0.02 >100 Number of employees (30 June) 3,822
Slide 23: Summary of key financials (II)
Summary of key financials (II) € million H1 2015 H1 2014 Change (%) Total assets 1,179.8 1,183.5 -0.3 Equity 535.1 489.6 9.3 Equity ratio (%) 45.4 41.4 -- Cash flow from operating activities 53.9 40.9 31.8 Free cash flow(1) 26.2 8.9 >100 Net financial position 33.2 -31.8 >100 Working capital 216.4 2
Slide 24: Income statement
Income statement € million H1 2015 H1 2014 Change (%) Revenue 670.2 753.4 -11.0 Cost of goods sold -555.6 -652.2 -14.8 Research and development costs -36.1 -31.0 16.5 Selling expenses -35.0 -33.2 5.4 Administrative expenses -18.6 -17.6 5.7 Other operating income 13.3 6.9 92.8 Other operating expense
Slide 25: Balance sheet: assets
Balance sheet: assets 30 June 31 Dec Change € million 2015 2014 (%) Non-current assets (excluding deferred tax assets) 554.5 563.6 -1.6 Deferred tax assets 66.3 62.2 6.6 Inventories 275.7 245.2 12.4 Trade receivables 130.2 122.0 6.7 Other receivables and assets 48.6 54.1 -10.2 Cash and cash equivale
Slide 26: Balance sheet: equity and liabilities
Balance sheet: equity and liabilities 30 June 31 Dec Change € million 2015 2014 (%) Equity 535.1 511.0 4.7 Provisions for pensions and other post-retirement benefits 176.6 187.1 -5.6 Other provisions 57.6 58.4 -1.4 Financial liabilities 66.0 73.3 -10.0 Other liabilities 3.4 3.9 -12.8 Non-current lia
Slide 27: Cash flow statement (condensed)
Cash flow statement (condensed) € million H1 2015 H1 2014 EBIT 20.3 6.2 Cash flow from operating activities (total) 53.9 40.9 Capital expenditure on intangible assets, property, plant and equipment and investments -26.3 -33.7 Proceeds from the sale of non-current assets 0.7 5.1 Cash flow from invest
Slide 28: Overview of segments, H1 2015
Overview of segments, H1 2015 H1 H1 Change H1 H1 Change New orders (€ million) 2015 2014 (%) Unit sales 2015 2014 (%) DEUTZ Compact Engines 530.0 612.1 -13.4 DEUTZ Compact Engines 71,353 92,935 -23.2 DEUTZ Customised Solutions 140.7 134.7 4.5 DEUTZ Customised Solutions 6,767 6,144 10.1 Total for ope
Slide 29: Overview of segments, Q2 2015
Overview of segments, Q2 2015 Q2 Q2 Change Q2 Q2 Change New orders (€ million) 2015 2014 (%) Unit sales 2015 2014 (%) DEUTZ Compact Engines 281.1 267.5 5.1 DEUTZ Compact Engines 37,758 51,279 -26.4 DEUTZ Customised Solutions 68.6 65.1 5.4 DEUTZ Customised Solutions 3,455 3,343 3.4 Total for operatin
Slide 30: Employees
Employees 30 June 30 June Change 2015 2014 (%) Cologne 2,348 2,417 -2.9 Ulm 384 394 -2.5 Other German operations 276 285 -3.2 Germany 3,008 3,096 -2.8 Foreign operations 814 918 -11.3 DEUTZ Group 3,822 4,014 -4.8 H1 2015 results 6 August 2015 30
Slide 31: Financial calendar & contact details
Financial calendar & contact details Interim report 1st to 3rd quarter 2015 5 November 2015 Annual Report 2015 17 March 2016 Annual General Meeting 28 April 2016 Interim report 1st quarter 2016 3 May 2016 Contact details Christian Krupp Tel:+49 (0) 221 822 5400 Ottostrasse 1 Fax:+49 (0) 221 822 15 5
Slide 32: 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.