Atlas Copco Group - Q3 2009 Results

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Published 22/Ocotber 2009

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Atlas Copco Group - Q3 2009 Results

  1. 1. Atlas Copco Group Q3 Results October 22, 2009
  2. 2. Contents <ul><li>Q3 Business Highlights </li></ul><ul><li>Market Development </li></ul><ul><li>Business Areas </li></ul><ul><li>Financials </li></ul><ul><li>Outlook </li></ul>
  3. 3. Q3 - Highlights <ul><li>Stable demand </li></ul><ul><ul><li>Still very low investment level </li></ul></ul><ul><ul><li>Improved demand in some emerging market </li></ul></ul><ul><ul><li>Increased activity within mining but still low equipment order level </li></ul></ul><ul><li>Sales of aftermarket products and services remained at good level </li></ul><ul><li>Healthy profitability </li></ul><ul><ul><li>Annual cost savings in excess of MSEK 2 000 now achieved </li></ul></ul><ul><ul><li>Favorable sales mix supported margin </li></ul></ul><ul><li>Operating cash flow very strong </li></ul>
  4. 4. Q3 - Figures in summary <ul><li>Organic order intake down 30% </li></ul><ul><li>Revenues of MSEK 15 088; 25% organic decline </li></ul><ul><li>Operating profit at MSEK 2 402 (3 640) </li></ul><ul><ul><li>An operating margin of 15.9% (19.7) </li></ul></ul><ul><ul><li>MSEK 60 in positive currency effect compared to last year </li></ul></ul><ul><li>Profit before tax at MSEK 2 210 (3 224) </li></ul><ul><li>Earnings per share SEK 1.42 (1.99) </li></ul><ul><li>Operating cash flow MSEK 4 275 (1 054) </li></ul>
  5. 5. Contents <ul><li>Q3 Business Highlights </li></ul><ul><li>Market Development </li></ul><ul><li>Business Areas </li></ul><ul><li>Financials </li></ul><ul><li>Outlook </li></ul>
  6. 6. Orders received - Local currency September 2009 Group total -35% YTD (-34 excl. cancellations) , -30% last 3 months (Structural change 0% YTD, 0% last 3 months) Portion of sales, Year-to-date, % A = Year-to-date vs. prev. year, % B = -44 -36 16 -36 -34 36 -28 -23 13 -24 -16 21 -28 -38 5 -24 -10 9 B C A Last 3 months vs. prev. year, % C = Year-to-date vs. prev. year, % B = Portion of sales, Year-to-date, % A =
  7. 7. Q3 - The Americas <ul><li>Continued weak demand in North America </li></ul><ul><ul><li>Low order intake for equipment in construction, mining and most industrial segments </li></ul></ul><ul><ul><li>Some good orders for oil and gas and energy recovery </li></ul></ul><ul><li>Situation improved in South America </li></ul><ul><ul><li>Recovery noted in both mining and construction segment </li></ul></ul>September 2009 B C A -24 -10 9 -44 -36 16 Last 3 months vs. prev. year, % C = Year-to-date vs. prev. year, % B = Portion of sales, Year-to-date, % A =
  8. 8. Q3 - Europe and Africa/Middle East <ul><li>Demand remained low in Europe </li></ul><ul><ul><li>Better development in Western than in Eastern Europe </li></ul></ul><ul><ul><li>Russia remained very weak </li></ul></ul><ul><li>Mixed development in Africa / Middle East </li></ul><ul><ul><li>Good demand within oil and gas sector in Northern Africa and Middle East but poor development in the south </li></ul></ul>September 2009 B C A -36 -34 36 -28 -23 13 Last 3 months vs. prev. year, % C = Year-to-date vs. prev. year, % B = Portion of sales, Year-to-date, % A =
  9. 9. Q3 - Asia and Australia <ul><li>Positive development in Asia </li></ul><ul><ul><li>Sequential improvement in China and India in most customer segments </li></ul></ul><ul><ul><li>Good mining demand in South East Asia </li></ul></ul><ul><ul><li>Weak demand in Japan </li></ul></ul><ul><li>Weak quarter in Australia </li></ul>September 2009 Last 3 months vs. prev. year, % C = Year-to-date vs. prev. year, % B = Portion of sales, Year-to-date, % A = B C A -24 -16 21 -28 -38 5
  10. 10. Organic * Growth per Quarter <ul><li>Change in orders received in % vs. same quarter previous year </li></ul>Atlas Copco Group, continuing operations *Volume and price Order cancellations
  11. 11. Atlas Copco Group – Sales Bridge
  12. 12. Contents <ul><li>Q3 Business Highlights </li></ul><ul><li>Market Development </li></ul><ul><li>Business Areas </li></ul><ul><li>Financials </li></ul><ul><li>Outlook </li></ul>
  13. 13. Atlas Copco Group Operating Profit and Return On Capital Employed (ROCE) by Business Area
  14. 14. Compressor Technique <ul><li>Overall demand stable on low level </li></ul><ul><ul><li>27% organic order decline </li></ul></ul><ul><ul><li>Good orders from oil and gas segment </li></ul></ul><ul><ul><li>Aftermarket continued to hold up well </li></ul></ul><ul><li>Operating margin at 18.6% </li></ul><ul><ul><li>Improvement from previous quarters thanks to lower costs and favorable sales mix </li></ul></ul><ul><li>Acquisition of Czech service company </li></ul>,
  15. 15. Compressor Technique Quarterly operating margins include Prime Energy from Q1 2006. *Volume and price
  16. 16. <ul><li>Solid aftermarket but low equipment demand </li></ul><ul><ul><li>Organic order decline of 34% </li></ul></ul><ul><ul><li>Improved activity level within mining </li></ul></ul><ul><li>Operating profit at MSEK 823, a margin of 13.8% </li></ul><ul><ul><li>Under-absorption and currency had a negative impact </li></ul></ul><ul><ul><li>Favorable sales mix and good cost development </li></ul></ul>Construction and Mining Technique
  17. 17. Construction and Mining Technique *Volume and price
  18. 18. Industrial Technique <ul><li>Continued tough market conditions </li></ul><ul><ul><li>Weak demand, both from the motor vehicle industry and the general industry, organic order intake down 38% </li></ul></ul><ul><ul><li>Positive service development in emerging markets </li></ul></ul><ul><li>Operating profit margin at 6.7% </li></ul><ul><ul><li>Still heavily affected by under-absorption </li></ul></ul><ul><ul><li>Gradual improvement from efficiency initiatives </li></ul></ul>
  19. 19. Industrial Technique *Volume and price
  20. 20. Contents <ul><li>Q3 Business Highlights </li></ul><ul><li>Market Development </li></ul><ul><li>Business Areas </li></ul><ul><li>Financials </li></ul><ul><li>Outlook </li></ul>
  21. 21. Group Total
  22. 22. Profit Bridge July – September, 2009 vs 2008
  23. 23. Profit Bridge – by Business Area July– September, 2009 vs 2008
  24. 24. Balance Sheet
  25. 25. Capital Structure Net Debt*/EBITDA *Net Debt adjusted for the fair value of interest rate swaps
  26. 26. Atlas Copco AB’s Loan Maturity Profile
  27. 27. Cash Flow
  28. 28. Contents <ul><li>Q3 Business Highlights </li></ul><ul><li>Market Development </li></ul><ul><li>Business Areas </li></ul><ul><li>Financials </li></ul><ul><li>Outlook </li></ul>
  29. 29. Near-term Outlook <ul><li>The overall demand is expected to stay around the current level. </li></ul><ul><li>The demand in some emerging markets, including China and India, is expected to gradually improve. </li></ul>
  30. 30.
  31. 31. Cautionary Statement <ul><li>“Some statements herein are forward-looking and the actual outcome could be materially different. In addition to the factors explicitly commented upon, the actual outcome could be materially and adversely affected by other factors such as the effect of economic conditions, exchange-rate and interest-rate movements, political risks, the impact of competing products and their pricing, product development, commercialization and technological difficulties, supply disturbances, and major customer credit losses.” </li></ul>

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