Schaeffler Ag · XETR:SHA0
Schaeffler — Investor Presentation (January 2017)
27 slides from Schaeffler's investor presentation, Jan 24, 2017
Slide 1: Schaeffler AG Capital Markets Presentation
Schaeffler AG Capital Markets Presentation January 24, 2017 Analyst and Investor Conference Call Pre-release FY2016 Results and Update Equity Story
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements. The words "anticipate", "assume", "believe", "estimate", "expect", "intend", "may", "plan", "project“, "should" and similar expressions are used to identify forward-looking statements. Forward-looking statements are statements that ar
Slide 3: Agenda
Agenda 1 Overview 2 Strategy "Mobility for tomorrow" 3 Investment Highlights 4 Outlook and Summary 3 January 24, 2017 Schaeffler AG Capital Markets Presentation
Slide 4: Pre-release FY 2016 results – Update Equity story
1 Overview Pre-release FY 2016 results – Update Equity story Chronology of events New Co-CEO Automotive Matthias Zink Nov 9, 2016 Results 9M 2016 Since 1994 with Schaeffler Goldman Sachs Annual Global Automotive Group Dec 8-9, 2016 Conference, London Until 2012 various Deutsche Bank Global Auto
Slide 5: Schaeffler Group – A leading automotive and industrial supplier
1 Overview Schaeffler Group – A leading automotive and industrial supplier Schaeffler at a glance Sales growth 2012 – 2016 in EUR bn 13.2 13.3 1) 12.1 11.1 11.2 Leading automotive and industrial supplier of high-precision components and systems Global footprint with around 85,000 employees at a
Slide 6: Preliminary Results for 2016 – Guidance 2016 comfortably achieved
1 Overview Preliminary Results for 2016 – Guidance 2016 comfortably achieved Sales 2014-2016 EBIT 3) 2014-2016 Free Cash Flow 2014-2016 in EUR mn Guidance 2016 in EUR mn Guidance 2016: in EUR mn Guidance 2016: Sales growth1) EBIT Margin3) Free Cash Flow6) 3-5% 12-13% ̴ 600 mn EUR 13,226 ̴13,300 2) 1
Slide 7: Strategy "Mobility for tomorrow" – 4 key elements
2 Strategy "Mobility for tomorrow" Strategy "Mobility for tomorrow" – 4 key elements Vision / Mission 4 Focus areas 8 Strategic pillars 16 Strategic initiatives 7 January 24, 2017 Schaeffler AG Capital Markets Presentation
Slide 8: Financial Ambitions 2020 – Profitable growth and sustainable value creation
2 Strategy "Mobility for tomorrow" Financial Ambitions 2020 – Profitable growth and sustainable value creation Financial Ambitions 2020 Sales Growth Ø 4-6% p.a. w/o external growth, FX-adjusted EBIT Margin 12-13% p.a. Before one-off effects, w/o external growth Free Cash flow ~€ 900M in 2020 w/o ext
Slide 9: Schaeffler Equity Story – 4 key questions
3 Investment highlights Schaeffler Equity Story – 4 key questions Equity Story – 3 key elements 4 key questions 1 What is your expectation regarding outperformance in Automotive for 2017? Automotive growth above market + 2 What does e-mobility mean for Schaeffler? Margin upside in Industrial 3 When
Slide 10: Schaeffler Automotive at a glance
3 Investment highlights Schaeffler Automotive at a glance Sales and EBIT margin 2012 – LTM 9M 2016 Sales by region 2015 in EUR mn 9,993 10,169 8,986 22% 7,658 8,164 53% 15% 2012 2013 2014 2015 LTM 2016 10% Growth rate (y-o-y)1) +5.1% +8.6% +10.7% +5.8% +5.3% EBIT margin2) 13.5% 13.0% 14.0% 13.6% 14.
Slide 11: Outperformance Automotive 2016 – Below average
3 Investment highlights 1 Outperformance Automotive 2016 – Below average Indicative figures for illustration purposes Outperformance 2010 – 9M 2016 Key aspects Q1 2016 ø 2010Q3– 2016 Q2 2016 2015:9M 2016 Q4 2016 FY 2016 Growth rate Automotive 1) 5.0% 5.8% +5%5.1% 5.3% to come to come Historical ou
Slide 12: Outperformance Automotive 2017 – Back to plus 4%-pts above-market
3 Investment highlights 1 Outperformance Automotive 2017 – Back to plus 4%-pts above-market Sales development Indicative figures for illustration Key aspects purposes Nearly 100% Expected global light vehicle production growth of booked business around 1.5% for 2017 Sales growth Schaeffler 2017
Slide 13: E-Mobility – Accelerated scenario becomes more realistic
3 Investment highlights 2 E-Mobility – Accelerated scenario becomes more realistic Global production volume 1) Basic scenario 2) Global production volume 1) Accelerated in millions of units in millions of units scenario 2) CAGR 2010/2030 CAGR 2010/2030 +2.4% p.a. 120 +2.4% p.a. 120 111 111 10% 102 4
Slide 14: E-Mobility – main powertrain structures
3 Investment highlights 2 E-Mobility – 3 main powertrain structures 1 Internal combustion engines 2 Hybrid vehicles 3 Battery electric vehicles Powertrain structure Powertrain structure Powertrain structure Battery capacity: Battery capacity: 5- 10 kWh 20- 100 kWh E = Engine E = Engine T = Tra
Slide 15: Strong starting position in e-mobility – Broad portfolio of solutions
3 Investment highlights 2 Strong starting position in e-mobility – Broad portfolio of solutions Product portfolio Key aspects 1999 C02 – Reduction 1st Schaeffler E-Mobility symposium 2002 1st E-Mobility concept car 2005 1st serial production of components HV hybrid for hybrid modules module 48 V hyb
Slide 16: More than 20 customer projects – 6 series contracts
3 Investment highlights 2 More than 20 customer projects – 6 series contracts Americas Europe China 1-Gear Electric Axle Front + Rear Tier 1 SOP Q3/2018 Hybrid Module Tier 1 SOP Q1/2018 2-Gear Electric Axle Rear Tier 1 Hybrid Module with SOP Q4/2017 Integrated Torque Converter Tier 1 1-Gear Electric
Slide 17: Compact Dynamics acquired – Broadening competence and scope
3 Investment highlights 2 Compact Dynamics acquired – Broadening competence and scope 1 System and Powertrain Competence 2 Acquisition Schaeffler acquires a 51% stake in Compact Dynamics GmbH from SEMIKRON International GmbH. Closing expected in Q1 2017; call option for remaining 49% stake until
Slide 18: Schaeffler Industrial at a glance
3 Investment highlights Schaeffler Industrial at a glance Sales and EBIT margin 2012 – LTM 9M 2016 Sales by region 2015 in EUR mn Americas 3,406 3,233 19% 3,138 Greater China Europe 3,041 3,029 2012 2013 2014 2015 LTM 2016 15% 56% Growth rate (y-o-y) 1) -1.6% -8.1% +4.2% -3.2% +3.0% -5.3% Asia/Pacif
Slide 19: Revitalizing the Industrial division – Program CORE
3 Investment highlights 3 Revitalizing the Industrial division – Program CORE 4 key drivers 1 Strengthen sales organizations in the regions Customer Strengthen regional engineering / customer support centers focus and growth Establish dedicated global key account management 2 Reduce overhead
Slide 20: Cost reduction and efficiency improvements – First wave mostly completed in 2016
3 Investment highlights 3 Cost reduction and efficiency improvements – First wave mostly completed in 2016 Key aspects Indicative Financial Impact Δ EBIT in EUR mn 40 First wave announced in August 2015 31 15 2) Cost savings through HCO reduction in overhead functions of the Industrial Division
Slide 21: Cost reduction and efficiency improvements – Second wave initiated in 2016
3 Investment highlights 3 Cost reduction and efficiency improvements – Second wave initiated in 2016 Indicative Indicative Financial Impact2) figures Key aspects Δ EBIT in EUR mn 58 Second wave announced in November 2016 23 41 50 60 Cost savings through consolidation of plants in Europe and Amer
Slide 22: Cost reduction and efficiency improvements – Overall target remains in place
3 Investment highlights 3 Cost reduction and efficiency improvements – Overall target remains in place Successful implementation Financial ambitions Today Indicative Stable market Timing environment Continuous improvement through further optional measures EBIT margin 500 HCO Industrial Division Cost
Slide 23: Customer focus and growth – New business picking up
3 Investment highlights 3 Customer focus and growth – New business picking up Example 1 Example 2 Example 3 Railway Wind Aerospace Sectors and products Sectors and products Sectors and products E-locomotive Wind turbine Aerospace engine Tapered and cylindrical roller bearing with ceramic D
Slide 24: Use of cash – M&A strategy based on selected add-on acquisitions
3 Investment highlights 4 Use of cash – M&A strategy based on selected add-on acquisitions M&A strategy Use of cash Approach Focus on technological competence to maintain our strong position as technology and innovation leader External growth Focus on smaller add-on acquisitions that contribute
Slide 25: Guidance for 2017 – Improved growth prospects
4 Outlook and Summary Guidance for 2017 – Improved growth prospects Guidance 2016 Actuals 2016 Guidance 2017 Sales growth 3-5% 3.4% 4-5% FX-adjusted FX-adjusted FX-adjusted Profitable growth EBIT margin 12-13% of sales 12.7% of sales 12-13% of sales and sustainable before one-off effects before one-
Slide 26: Mobility for tomorrow – Key messages
4 Outlook and Summary Key messages Pre-release of preliminary figures with strong results (FX-adjusted sales growth 3.4%, adj. 1 EBIT margin 12.7%; FCF EUR ~730mn), comfortably achieving Guidance for 2016 2 Outperformance Automotive below-average in 2016, but back to 4%-pts target in 2017 3 Powertra
Slide 27: IR Contact
IR Contact Investor Relations Financial Calendar FY 2016 results: March 8, 2017 Phone: + 49 9132 82 4440 Q1 2017 results: May 11, 2017 Email: [email protected] H1 2017 results: August 8, 2017 Web: www.schaeffler.com/ir 9M 2017 results: November 8, 2017 27 January 24, 2017 Schaeffler AG Capital Marke