Autoliv, Inc. · NYSE:ALV
Autoliv — Q2 2006 Earnings Presentation
23 slides from Autoliv's earnings presentation, 2006
Slide 1: Autoliv Teleconference Concerning the 2nd Quarter Financial Earnings 2006
Autoliv Teleconference Concerning the 2nd Quarter Financial Earnings 2006 The Worldwide leader in Automotive Safety Systems PRIVATE
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains statements that are not statements of historical facts, but instead are forward-looking statements. All forward-looking statements involve risks and uncertainties. Actual results could differ materially from those contained in forward-looking statemen
Slide 3: Sales Trend
Sales Trend US$ million 1600 Moving 12 1400 month average 1200 1000 800 600 400 200 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2000 2001 2002 2003 2004 2005 2006 AUTOLIV-AHO/IR/Power/Status Report/2006/2Q06 - 3 Propriety
Slide 4: Organic Growth vs Vehicle Production
Organic Growth vs Vehicle Production % 20 15 10 5 0 -5 -10 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2000 2001 2002 2003 2004 2005 2006 Change in Autoliv’s organic sales vs same quarter previous year Change in Light Vehicle Production in the Triad vs same quarter
Slide 5: Light Vehicle Production
Light Vehicle Production Units in thousands Q2 ´06 Q2 ´05 Change N. America 4,144 4,151 -0.2% - Big 3 2,893 2,913 -0.7% - New Domestic 1,251 1,238 1.0% Europe 5,347 5,508 -2.9% - W. Europe 4,125 4,430 -6.9% - E. Europe 1,222 1,078 13.4% Japan 2,533 2,396 5.7% Total in the Triad 12,024 12,055 -0.3% A
Slide 6: Autoliv's Production Q2 2006 vs Q2 2005
Autoliv’s Production Q2 2006 vs Q2 2005 Units in thousands Change Seatbelts 25,054 -1% Pretensioners 12,095 1% Frontal airbag 6,885 -4% Side airbag: Chest 5,428 -1% Head 4,436 10% Steering wheels 2,491 6% L.V. production in the Triad 12,024 -0.3% Airbags 66% (66%) Seatbelts 34% (34%) (Incl. Steering
Slide 7: Improving Gross Margin Despite Tough Market
Improving Gross Margin Despite Tough Market % 25 21,4 21,0 19,6 20,6 20 18,6 17,9 15 10 5 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2001* 2002 2003** 2004 2005 2006 * Excluding Unusual Items in Q3, 2001. ** Including one-time charges in Q4, 2003 which reduced gross margin b
Slide 8: Long-term Improvement in Operating Margin
Long-term Improvement in Operating Margin % 10 8,8 8,3 9,0 8,7 8 8,0 8,2 6 4 2 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2001* 2002 2003** 2004 2005 2006 * Excluding Unusual Items in Q3, 2001 ** Including special items in Q4, 2003 which boosted margin by 1.2 pp AUTOLIV-AHO/
Slide 9: Income Statement
Income Statement % of sales (US$ million) Q2 ‘06 Q2 ‘05 % Inc/dec Q2 ‘06 Q2 ‘05 Airbags $1,065.7 $1,087.3 (2) 66.3 65.7 Seatbelts 542.2 567.3 (4) 33.7 34.3 Total Sales 1,607.9 1,654.6 (3) 100.0 100.0 COGS (1,264.6) (1,306.6) (3) (78.6) (79.0) Gross profit 343.3 348.0 (1) 21.4 21.0 SG&A (81.8) (84.5)
Slide 10: Net Income Comparison
Net Income Comparison* Q2 2006 vs Q2 2005 Financial Lower sales net -2 Minority +4 Buy - -3 FX backs +1 -3 85.6 82.8 Q2 ‘05 Q2 ‘06 *US$ million AUTOLIV-AHO/IR/Power/Status Report/2006/2Q06 - 10 Propriety
Slide 11: Return on Equity
Return on Equity % 18 16 14,2 14,6 13,4 14 13,6 12 11,0 10 9,3 8 6 4 2 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2001* 2002 2003** 2004 2005*** 2006 *) Excl. Unusual Items in Q3 **) Including special items in Q4 which boosted the return by 2.9 pp ***) Incl. 1.8 negative eff
Slide 12: Continued Positive ROCE-Trend
Continued Positive ROCE*-Trend % 20 17,7 18 18,4 17,9 16 15,6 14 13,2 12 10,9 10 8 6 4 2 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2001** 2002 2003*** 2004 2005 2006 *) Return on capital employed **) Excl. Unusual Items in Q3 ***) Including special items in Q4 with a net ef
Slide 13: Key Figures
Key Figures Q2 2006 Q1 2006 Q4 2005 Q3 2005 Q2 2005 Earnings/share (US$) $1.00 $1.13 $.81 $.66 $.94 Return on - equity (%) 14.2 16.3 11.8 9.6 13.4 - capital employed (%) 17.7 17.7 17.1 13.0 17.9 Operating working capital (US$ million) 568 552 518 587 576 - in % of LTM sales 9.4 9.1 8.3 9.1 9.0 Capit
Slide 14: Move to Low Cost Countries
Move to Low Cost Countries Headcount in HCC Headcount in LCC 25000 25000 18% Temps 20% 20000 20000 Temps 8% 5% 15000 15000 10000 10000 5000 82% Employees 80% 5000 95% Employees 92% 0 0 Q4 '04 Q1 '05 Q2 '05 Q3 '05 Q4 '05 Q1 '06 Q2 '06 Q4 '04 Q1 '05 Q2 '05 Q3 '05 Q4 '05 Q1 '06 Q2 '06 AUTOLIV-AHO/IR/Po
Slide 15: Strong Long-Term Cash Flow
Strong Long-Term Cash Flow US$ million 2002 20031) 2004 2005 LTM Q2 06 Net income 176 268 326 293 306 83 Depreciation & amortization 249 279 298 309 296 76 Other non-cash items 38 12 (12) 62) (16) 1 Change in WC 46 (30) 68 (129) (7) 2 Cash from operations 509 529 680 4792) 579 162 Capex, net (218) (
Slide 16: Stock Buy-Backs (MUSD)
Stock Buy-Backs (MUSD) 102.6 377.8 Total: 21.89 million 800 shares Avg. price: $36.51 143.9 43.0 30.4 103.0 2000 2001 2002 2003 2004 2005 H1’06 Tot. Share price US$ 22.64 19.52 20.92 41.88 44.79 54.19 36.51 AUTOLIV-AHO/IR/Power/Status Report/2006/2Q06 - 16 Propriety
Slide 17: US Light Vehicle Inventory
US Light Vehicle Inventory Domestically Manufactured and Imported Vehicles Days 2006 2005 2004 10-year average 100 June 2006, 72 days 90 80 70 60 50 40 30 20 10 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec AUTOLIV-AHO/IR/Power/Status Report/2006/2Q06 - 17 Propriety
Slide 18: Light Vehicle Production: North America
Light Vehicle Production North America Millions 5 +4.8% -0.2% -3.9% -1.9% 4 Total 3 2003 15.9M 2 2004 15.8M 2005 15.8M 1 2006 15.7M 2007 16.1M 0 Q1 Q2 Q3 Q4 Source: CSM, forecast July, 2006 AUTOLIV-AHO/IR/Power/Status Report/2006/2Q06 - 18 Propriety
Slide 19: Light Vehicle Production: Europe
Light Vehicle Production Europe Millions +5.0% +6.2% -2.9% +1.2% 6 5 4 Total 2003 16.3M 3 2004 20.3M 2 2005 20.1M 2006 20.7M 1 2007 20.7M 0 Q1 Q2 Q3 Q4 Source: JD Power LMC, forecast July, 2006 Note: 2003 only includes Western Europe AUTOLIV-AHO/IR/Power/Status Report/2006/2Q06 - 19 Propriety
Slide 20: Light Vehicle Production: Japan
Light Vehicle Production Japan Millions +2.5% +2.7% +4.9% +5.7% 3 2,5 2 Total 2003 9.5M 1,5 2004 9.6M 1 2005 10.0M 2006 10.4M 0,5 2007 10.5M 0 Q1 Q2 Q3 Q4 Source: CSM, forecast July, 2006 AUTOLIV-AHO/IR/Power/Status Report/2006/2Q06 - 20 Propriety
Slide 21: Major Launches 2006
Major Launches 2006 BMW X5 Volvo S80 Ford SMAX Mini Cooper Peugeot 207 Ford Galaxy AUTOLIV-AHO/IR/Power/Status Report/2006/2Q06 - 21 Propriety
Slide 22: Outlook for Q3, 2006
Outlook for Q3, 2006* Change Quarter over Quarter • Consolidated Sales: +2% due to currency effects • Operating margin to exceed 7% * Based on the assumptions provided in the quarterly report AUTOLIV-AHO/IR/Power/Status Report/2006/2Q06 - 22 Propriety
Slide 23: Thank you
Thank you Autoliv The Worldwide leader in Automotive Safety Systems PRIVATE