Traton Se · XETR:8TRA
Traton — Non-Deal Roadshow (November 2023)
64 slides from Traton's roadshow presentation, November 2023
Slide 1: TRATON Roadshow Presentation
TRATON Roadshow Presentation Group Investor Relations – November 2023
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 the TRATON GROUP
Slide 3: Agenda
Agenda 1. TRATON GROUP Overview 2. Strategy „TRATON Way Forward“ 3. Business Performance Q3 2023 & Outlook November 2023 Roadshow Presentation 3
Slide 4: Overview TRATON GROUP
Overview TRATON GROUP Four strong global brands under one roof 100,356 Employees worldwide1 “Transforming Transportation Together. For a sustainable world.” €40.3 bn Sustainability as a core Sales revenue principle and responsible behavior as a top priority in the Group’s strategy 28 production and
Slide 5: Four strong global brands under one roof
Four strong global brands under one roof 5
Slide 6: Major milestones for TRATON GROUP
Major milestones for TRATON GROUP 2015 2019 2021 2021 2022 Establishment of Successful IPO Acquisition of Introduction Charging JV with VW Truck & Bus of TRATON SE Navistar of new Daimler Truck Group powertrain & Volvo Group 2018 2021 2021+ 2023 Re-branding/ Squeeze-Out MAN SE, New strategy, the Go-
Slide 7: Strong group of brands across key CV markets
Strong group of brands across key CV markets Home base Europe and Europe North America South America South America Unit sales (k) FY 2022 Trucks 254 80 58 69 47 Buses 30 5 5 13 7 Vans 22 - 22 - - Total 305 85 85 82 54 Trucks 83% Buses 10% Vans 7% November 2023 Roadshow Presentation 7
Slide 8: Production & assembly sites around the globe
Production & assembly sites around the globe 13 8 5 2 November 2023 Roadshow Presentation 8
Slide 9: Diversified by geography and by brand
Diversified by geography and by brand Unit sales FY 2022 (% of total) Sales revenue FY 2022 (% of total) Other Germany Financial Services regions Volkswagen 10% 3% South 10% Truck & Bus Navistar 7% America Sales & (excl. Brazil) Services 5% 25% EU27 +3 MAN Brazil 20% 305 k (excl. Germany) 27% €40.3
Slide 10: Key figures development 2018 to 2022
Key figures development 2018 to 20221 Incoming orders (k units) Unit sales (k units) Book-to-bill (ratio in units) 360 335 1.33 305 272 1.14 1.10 244 1.05 227 233 242 0.94 216 190 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 Sales revenue (€ bn) Adjusted operating resul
Slide 11: Agenda
Agenda 1. TRATON GROUP Overview 2. Strategy „TRATON Way Forward“ 3. Business Performance Q3 2023 & Outlook November 2023 Roadshow Presentation 11
Slide 12: TRATON Way Forward
TRATON Way Forward Full focus and commitment on execution along strategic framework Decarbonization & Circularity Responsible People & Diversity Company Governance & Ethics Performance-driven Strategy Value Navistar as part of TRATON family Execution & Creation TRATON goes China Governance Business
Slide 13: Responsible Company
Responsible Company Make responsible behavior a top priority in everything we do Decarbonization & Circularity Strategy Execution & Governance People & Diversity Governance & Ethics TRATON Responsible Accelerated! Company Value Creation November 2023 Roadshow Presentation 13
Slide 14: We are fully committed to the Paris Agreement
Responsible company We are fully committed to the Paris Agreement Truck and Bus Scope -50% -70% -20% -28/-19% 1+2 t CO2e t CO2e (2030 vs. 2019)1 Energy intensity improvement Electricity/Gas usage (2025 vs. 2015)1 (2030 vs. 2018)3 (2022 vs. 2018)2 Well to wheel Well to wheel Tank to wheel Scope 35 -2
Slide 15: TRATON advances in its strategic initiatives to become more sustainable
Responsible company TRATON advances in its strategic initiatives to become more sustainable company Navistar to set emissions reductions targets for validation by the Science- Based Targets Initiative (SBTi). Scania places first green steel order in further step towards decarbonized supply chain. Na
Slide 16: Our CO2 impact stems almost exclusively from products' use phase
Responsible company Our CO2 impact stems almost exclusively from our products’ use phase – but will change in the future Combustion engine BEV BEV (electricity mix)1 (green electricity)2 Use Production Maintenance Recovery 1 Based on EU 2016 electricity mix 2 Based on prognosed EU 2030 electricity m
Slide 17: A comparison of system efficiency between BEVs and FCEVs
Responsible company A comparison of system efficiency between BEVs and FCEVs PRODUCTION REFUELING OPERATION BEV Electrical 75% energy distribution & mix of slow & DC-AC, engine & inversion AC/DC Fast charging transmisson of energy of energy reaches reaches the wheels the wheels 100% – 10% – 5% – 10%
Slide 18: The cost distribution will change significantly with fully electric trucks
Responsible company The cost distribution will change significantly with fully electric trucks Cost distribution electric long-haul Cost distribution of a typical long-haul heavy-duty truck - today heavy-duty truck ~2025-30 Savings potential Energy incl. infrastructure Overhead Electric trucks R&M E
Slide 19: We boost our e-mobility investments
Responsible company We boost our e-mobility investments Investment increase 2022 Investment increase 2021 €1.6 bn €2.6 bn €1.0 bn 2020 - 2025 2021 - 20261 1 Incl. Navistar November 2023 Roadshow Presentation 19
Slide 20: TRATON GROUP – Electric vehicles
Responsible company TRATON GROUP – Electric vehicles Incoming orders of Unit sales of All TRATON brands with BEV products fully electric vehicles fully electric vehicles across major applications/weight classes (units) (units) 9M 23 9M 23 1,703 1,190 744 709 649 586 608 526 536 424 487 446 397 387 4
Slide 21: High-performance charging network for Europe
Responsible company High-performance charging network for Europe >1,700 public charging points €500 mn investment (jointly) Milence Joint Venture operational since Network will be open and accessible to July 2022. all brands. Organization ramped up, experienced Intended to enhance customer c
Slide 22: Electrification will impact repair & maintenance but open new profit pools
Responsible company Electrification will impact how we do repair & maintenance but will also open new profit pools Win customers from 3rd party Shift business model Charging services providers for complex from product to service (e.g. eMSP, charging) repair/maintenance services Price based o
Slide 23: TRATON to continue path to decarbonization in 2023
Responsible company TRATON to continue path to decarbonization in 2023 with tangible steps in products, supplies and infrastructure Scania and Northvolt unveil green battery capable to power trucks for 1.5 million km. MAN prepares series production start of long-distance eTruck. First Scania 40-ton
Slide 24: Value Creation
Value Creation Focus on sustainable value creation for our stakeholders Performance-driven Strategy Execution & Governance Navistar as part of TRATON family TRATON goes China TRATON Responsible Accelerated! Company Value Creation November 2023 Roadshow Presentation 24
Slide 25: Creating value for our stakeholders
Value creation Creating value for our stakeholders 1 2 3 Performance driven Successful integration China important of Navistar growth market Brand performance programs, brand Integration of Navistar and realization China as important future profit pool cooperation and performance culture of its full
Slide 26: Ambitious targets for each of our brands
Value creation Ambitious targets for each of our brands Strategic RoS target 12% 8% 9% 8% Fully committed Realignment program Deliver profitable Volume growth and to sustainability & topline performance strong products improvement More high-margin Benefit from Group Higher margin by ne
Slide 27: MAN re-alignment on track
Value creation MAN re-alignment on track with significant benefits from structural measures materializing throughout 2023 Capacity expansion of Krakow plant successfully completed, ramp-up of production until end of 2023 with daily rate of up to 300 vehicles and cabs. Full P&L benefit from sale of S
Slide 28: Successful integration of Navistar
Value creation Successful integration of Navistar Accomplished since the merger … … and there is much more to come Strong progress in integrating Navistar into Unify our values and culture with TRATON TRATON’s operations to guide us every day Broadened management team with strong Create solutions th
Slide 29: China is one of the most important profit pools
Value creation China is one of the most important profit pools Ca. 1 million trucks typically sold every year World’s largest single market for commercial vehicles Segment shift towards more sophisticated products First western truck manufacturer with license for fully independent production in Chin
Slide 30: TRATON Accelerated!
TRATON Accelerated! Shape our role in the future logistics ecosystem Business Model Expansion Strategy Execution & Governance Partnership Culture Embrace Digital TRATON Responsible Accelerated! Company Value Creation November 2023 Roadshow Presentation 30
Slide 31: ACE platform elements critical for all ACE-related business models
TRATON Accelerated! ACE1 platform elements critical for all ACE-related business models Autonomous vehicle Self-driving system Control Tower + service (SDS) (CT) ACE vehicle Virtual driver ensures Ensures basic dispatching control of vehicle of vehicles Maintenance & repair capabilities Au
Slide 32: We build a solution ecosystem around our customer
TRATON Accelerated! We build a solution ecosystem around our customer Administration Transport planning Charging Reports & analytics facilities Transport Real-time tracking management Route & flow optimization En-route Vehicle data & telematics Cost optimization Fleet Mobility Added services Vehicle
Slide 33: TRATON FS – Global multi-brand captive finance business
TRATON Accelerated! TRATON FS – Global multi-brand captive finance business leveraging existing structures Brand specific front office Common back office Increased funding capabilities November 2023 Roadshow Presentation 33
Slide 34: Key milestones reached to establish TRATON Financial Services
TRATON Accelerated! Key milestones reached to establish global captive and integrated TRATON Financial Services business Go-live of TRATON Financial Services and transfer of Scania FS effective April 1, 2023. Take-over of MAN and VWTB FS activities announced, stepwise market roll-out and integration
Slide 35: TRATON Way Forward - strong focus on execution
TRATON Way Forward - strong focus on execution Strategy Execution & Governance Responsible TRATON TRATON Company Accelerated! Accelerated! Value Creation November 2023 Roadshow Presentation 35
Slide 36: Build-up of a TRATON Modular System
Strategy Execution & Governance Build-up of a TRATON Modular System based on Scania principles Scania Bygglåda TRATON Modular System TRATON Modular System We create standardized Group interfaces 2x Within Group: Same need – identical solution Enable profitable mass customization of broad variant off
Slide 37: Common base engine entering markets
Strategy Execution & Governance Common base engine (CBE) entering markets with strong benefits for customers and TRATON GROUP brands No.1 The world’s most sustainable powertrain with a 13L common base engine (CBE) 2022 2023 2024 … 2028 8% long-haulage Up to 15% gain 80% fuel savings1 in fuel efficie
Slide 38: Key steps taken in 2022 in implementation of Modular System
Strategy Execution & Governance Key steps taken in 2022 in Group-wide implementation of the TRATON Modular System Highly competitive Scania Super launched based on Common Base Engine (CBE). Production ramp-up expected to accelerate throughout 2023. Key Group-wide development and major step to go com
Slide 39: Roll-out of Modular System with focus on Navistar
Strategy Execution & Governance Roll-out of TRATON Modular System continues with particular focus on Navistar First deliveries of new Navistar International S13 Integrated Powertrain in H2 2023. New powertrain, based on CBE, combined with updated aerodynamics package. Offering up to 15% improved fue
Slide 40: Implementing new steering philosophy
Strategy Execution & Governance Implementing new steering philosophy to support roll-out of TRATON Modular System Establishment of Truck Board reflecting Group responsibilities for Research & Development, Procurement, Production & Logistics. R&D New steering structure to strengthen collaboration, Pr
Slide 41: Shared values across the TRATON GROUP
Strategy Execution & Governance Shared values across the TRATON GROUP supporting collaboration and execution One shared purpose: Transforming Transportation CUSTOMER FIRST Together. For a sustainable world. CORE VALUES ELIMINATION Updated five shared values OF WASTE RESPECT help us to create the des
Slide 42: One strong Group delivering
Strategy Execution & Governance More performance steps One Faster time to market, and more customer value one integration, then strong Group “plug & play” for brands to all brands delivering outstanding customer value Lower product/component/ system cost as well as Afford necessary integration cost
Slide 43: Stringent execution along building blocks towards RoS target
Stringent execution along clearly defined building blocks towards RoS target Volume 9% increase MAN T&B 5.1% realignment Improved Input cost price & mix inflation Efficiency gains R&D expenses across Group in future trends 2022 TRATON GROUP TARGET 2024 November 2023 Roadshow Presentation 43
Slide 44: Building blocks driving margin upside and earnings resilience
Building blocks driving margin upside and earnings resilience Volume, mix & pricing MAN T&B realignment program Highly competitive products & services Improved fixed cost structure and leading to volume increases and better increased productivity thanks to stringent price positioning & mix across th
Slide 45: TRATON's capital framework
TRATON’s capital framework – Focus on optimizing pillars to deleverage Operating funding Effective use Structural sources of funds measures Improving Targeted, Strengthening cash conversion earnings future-oriented Strong capital momentum R&D and Capex commitment Improved structure to further deleve
Slide 46: Why TRATON is an attractive investment
Why TRATON is an attractive investment Strong competitive position with a diversified regional and brand portfolio in an attractive global growth market and profit pool State-of-the-art products and services strongly geared towards future trends in order to capture the opportunities in our industry
Slide 47: Agenda
Agenda 1. TRATON GROUP Overview 2. Strategy „TRATON Way Forward“ 3. Business Performance Q3 2023 & Outlook November 2023 Roadshow Presentation 47
Slide 48: Sustained strong earnings performance
Sustained strong earnings performance Q3 2023 Incoming orders 64.4k (-30%) Unit sales 81.4k (+2%) Sales revenue €11.3 bn (+7%) Vehicle Services business €2.1 bn (-3%) Adj. oper. result €955 mn (+€406 mn) Adj. RoS 8.4% (+3.2 pp) 48
Slide 49: Demand normalizing with continued high levels of unit sales
Demand normalizing with continued high levels of unit sales Incoming orders Unit sales (k units) (k units) 9M 23 9M 23 189.6 249.5 Incoming orders lower year-on-year (-26%) (+15%) compared to high prior-year basis due to a normalization of demand; book-to-bill at 0.8x. -30% +2% 92.0 88.3 Order book
Slide 50: Demand remains at high level, but normalization
Demand remains at high level, but normalization of demand and active order book management Incoming orders & Unit sales (k units) For Scania, MAN and Navistar lead Scania Vehicles & Services MAN Truck & Bus 50 50 Europe: times Demandstillweakening clearly above long-term in some 40 40 markets, avera
Slide 51: Top-line growth driven by higher new vehicle sales
Top-line growth driven by higher new vehicle sales Sales revenue (€ bn) 9M 23 34.2 Sales revenue increased to €11.3 bn, up by (+20%) 7% compared to high prior-year basis. +7% 11.8 11.7 Higher unit sales of new vehicles, a favorable 11.3 11.2 10.6 market and product mix and better unit price realizat
Slide 52: Continued strong underlying earnings and profitability
Continued strong underlying earnings and profitability Adj. operating result Adj. RoS (€ mn) (%) 9M 23 9M 23 2,929 8.6 Adjusted operating result and margins (+1,582 mn) (+3.9 pp) with strong growth. +406 Earnings benefited in particular from +3.2 8.9 − higher utilization of production capacity and 1
Slide 53: 9M/Q3 2023 performance and key drivers by brands/segments
9M/Q3 2023 performance and key drivers by brands/segments TRATON Financial Services Sales revenue 12,646 (+18%) 10,643 (+36%) 8,357 (+9%) 1,943 (-15%) 1,158 (+24%) (in € mn, YoY) 9M Adj. RoS (YoY) 12.8% (+5.1 pp) 7.1% (+6.1 pp) 6.5% (+2.2 pp) 9.6% (-1.2 pp) 19.1% (-4.3 pp) Sales revenue 4,027 (+5%)
Slide 54: Positive net cash flow development
Positive net cash flow development due to strong operating performance despite ongoing working capital headwinds Net cash flow TRATON Operations (€ mn) 9M 23 2,403 Strong net cash flow in Q3 23 driven by (€+3,737 mn) considerably improved operating performance. 1,018 €1.4 bn working capital build-up
Slide 55: Net debt position further improved
Net debt position further improved due to strong operating performance Net financial debt bridge, 9M 2023 (€ mn) €-1.1 bn Net debt of TRATON Operations -1,448 incl. Corporate Items reduced by -372 4,223 -527 €1.1 bn vs. year-end 2022 -1,687 -3,118 Debt driven by + strongly improved operating related
Slide 56: Continued solid truck market demand, while uncertainties remain
Continued solid truck market demand, while economic uncertainties remain 600 k units, > 6t - Above-average fleet age 336 Expectation 400 & high pent-up demand EU27+31 2023e - Improving supply chains 200 +10% – +20% - Robust logistics demand 0 and freight rates 09 11 13 15 17 19 21 23 600 k units, cl
Slide 57: Outlook 2023 increased
Outlook 2023 increased: Backed by strong first nine month, TRATON targeting higher RoS and cash flow ranges FY 2022 FY 2023 FY 2023 Outlook Outlook 2023 Half-Year Financial Report 9M 2023 Interim Statement Unit sales 305.5 k +5 to +15% +5 to +15% +12% Sales revenue €40.3 bn +5 to +15% +5 to +15% +32
Slide 58: Thank you!
Thank you! Contact
Slide 59: Sales revenue and adjusted operating result by segment
TRATON GROUP – Sales revenue and adjusted operating result by segment Sales revenue, Q3 2023 (€ mn) Adj. operating result, Q3 2023 (€ mn) Adj. RoS (∆ YoY) 11.5% 7.8% 7.3% 10.1% 9.2% 14.8% 8.4% (+3.9 pp) (+6.3 pp) (+1.4 pp) (-1.4 pp) (+3.4 pp) (-7.2 pp) (+3.2 pp) 421 11,321 677 11,018 (+30%) 62 (+7%)
Slide 60: TRATON GROUP – Outlook
TRATON GROUP – Outlook TRATON GROUP 2022 2023e Unit sales (units) 305,485 +5-15% Sales revenue (€ million) 40,335 +5-15% Adjusted RoS (in %) 5.1 7.5-8.5 TRATON Operations 2022 2023e Sales revenue (€ million) 39,554 +5-15% Adjusted RoS (in %) 5.7 8.0-9.0 Net cash flow (€ million) -625 2,300-2,800 Cap
Slide 61: TRATON Management Board
TRATON Management Board TRATON SE EXECUTIVE BOARD MEMBERS Christian Levin Dr. Michael Jackstein Catharina Modahl Nilsson CEO TRATON SE and Scania CFO and CHRO TRATON SE Product Management TRATON SE Alexander Vlaskamp Antonio Roberto Cortes Mathias Carlbaum CEO MAN CEO Volkswagen Truck & Bus CEO and
Slide 62: TRATON Investor Relations Team
TRATON Investor Relations Team Thomas Paschen Michael Lankes Analysts and Investors, Private Investors Annual General Meeting, Events +49 170 907 34 94 +49 89 360 98 328 [email protected] [email protected] Contact Navistar: Fabian Schimpf Marvin Kalberlah Analysts and Investors, Priv
Slide 63: Useful links
Useful links TRATON GROUP BRANDS TRATON Website Scania Newsroom Investor Relations Website MAN Newsroom Newsroom Navistar Newsroom Publications VWTB Newsroom Share Financial Figures 2022 Annual Report Debt & Rating Sustainability Corporate Governance Annual General Meeting Financial Dates & Events C
Slide 64: Find out more on www.traton.com
Find out more on www.traton.com