Dürr AG: Conference Call Q3/9M 2013

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Dürr AG: Conference Call Q3/9M 2013

  1. 1. WELCOME DÜRR AKTIENGESELLSCHAFT CONFERENCE CALL RESULTS JANUARY – SEPTEMBER 2013 Ralf W. Dieter, CEO Ralph Heuwing, CFO Bietigheim-Bissingen, November 6, 2013 www.durr.com
  2. 2. DISCLAIMER This presentation has been prepared independently by Dürr AG (“Dürr”). The presentation contains statements which address such key issues as Dürr´s strategy, future financial results, market positions and product development. Such statements should be carefully considered, and it should be understood that many factors might cause forecast and actual results to differ from these statements. These factors include, but are not limited to, price fluctuations, currency fluctuations, developments in raw material and personnel costs, physical and environmental risks, legal and legislative issues, fiscal, and other regulatory measures. Stated competitive positions are based on management estimates supported by information provided by specialized external agencies. © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 2
  3. 3. ORDERS ON TRACK, SALES ACCELERATING, BOOK-TO-BILL AT 1 9 months 2013 9 months 2012 Incoming orders 1,797.5 1,954.3 -8.0% 504.0 550.0 -8.4% Sales revenues 1,746.1 1,757.5 -0.6% 614.5 594.2 3.4% Orders on hand (09/30) 2,253.8 2,332.1 -3.4% 2,253.8 2,332.1 -3.4% in € m Δ Q3 2013 Q3 2012 Δ Incoming orders at expected level Order backlog stays on a high level Project pipeline continues to be strong © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 3
  4. 4. INCOMING ORDERS BY REGION JANUARY – SEPTEMBER 2013 VS. 2012 in € m 2.500 2.000 -8% Strong EM business (e.g. China, Brazil) 1,954.3 1,797.5 Germany and Europe weak as expected 1.500 2012 -20% +9% 1.000 2013 +5% -28% 523.5 568.1 500 414.8 433.7 593.5 472.4 336.0 -5% 240.8 86.5 82.5 0 Total China © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 America Germany Europe (w/o Germany) Asia (w/o China) Africa 4
  5. 5. STRONG EARNINGS GROWTH in € m 9 months 2013 9 months 2012 Δ Q3 2013 Q3 2012 Δ Gross profit on sales 340.3 311.0 9.4% 120.4 112.9 6.6% EBITDA 156.5 138.6 12.9% 60.6 53.5 13.3% EBIT 134.1 118.9 12.8% 51.7 46.5 11.2% 87.6 71.3 22.9% 35.2 27.3 28.9% Net income Gross margin reached 19.5% in first 9 months 2013 (9 months 2012: 17.7%) Moderate increase of SG&A costs: +4.5% EBIT margin reached 7.7% in first nine months 2013 (9 months 2012: 6.8%); in the middle of our new guidance range Net income supported by strong improvement of financial result © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 5
  6. 6. CONSIDERABLE CASH FLOW IMPROVEMENT IN FIRST NINE MONTHS 2013 9 months 2013 9 months 2012 119.1 95.7 46.9 36.2 Depreciation and amortization of non-current assets 22.5 19.8 9.0 6.9 Interest result 15.1 23.5 4.6 10.4 -25.5 -13.2 -9.2 -4.4 14.0 -10.4 4.4 4.8 Δ Net working capital -83.5 -147.6 -29.9 -27.6 Other -16.3 13.8 7.5 20.0 45.4 -18.4 33.3 46.3 Interest paid (net) -16.1 -19.7 -15.4 -17.6 Capital expenditures -34.0 -21.1 -12.3 -6.0 -4.7 -59.2 5.6 22.7 in € m EBT Income taxes paid Δ Provisions Cash flow from operating activities Free cash flow © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 Q3 2013 Q3 2012 6
  7. 7. NWC SEASONALITY SIMILAR TO 2012 09/30/2013 NWC in € m DWC (Days Working Capital) DSO (Days Sales Outstanding) 12/31/2012 09/30/2012 181.8 98.6 177.7 28.1 14.8 27.3 131.6 104.3 115.7 NWC => Decrease in Q4 expected DWC => Should be within the target range of 20 to 25 days at year end © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 7
  8. 8. WIP AND PROGRESS BILLINGS: WIP BALANCE IN BETWEEN THE TYPICAL RANGE in € m 09/30/2013 12/31/2012 09/30/2012 Assets 1 WIP in excess of billings 419.5 349.1 387.5 -1,196.9 -1,200.6 -1,261.9 1,722.8 1,654.8 1,713.2 525.9 454.2 451.3 -44.2 -28.0 -34.0 Liabilities Work in process from contracts (WIP) Progress billings 2 Billings in excess of WIP Machinery business WIP 3 Progress billings 32.7 32.2 33.0 4 Billings in excess of WIP -11.5 4.2 -1.0 Total WIP less total progress billings -94.9 -109.3 -62.8 Prepayments (liabilities) 558.6 486.4 484.3 Balance 1 - 2 - 4 2 + 3 © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 8
  9. 9. EQUITY FURTHER STRENGTHENED 09/30/2013 12/31/2012 09/30/2012 464.7 432.1 411.3 Equity ratio in % 23.9 23.9 23.5 Net financial status in € m 37.0 96.7 -25.8 246.7 349.3 249.7 Gearing in % -8.7 -28.8 5.9 ROCE1) in % 34.9 43.9 32.1 Equity in € m Cash in € m Equity ratio should increase in Q4 Cash including term deposits and financial assets (e.g. bonds): € 305 m 1) annualized © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 9
  10. 10. PAINT AND ASSEMBLY SYSTEMS Operating result: Better than expected in € m 9 months 9 months 2013 2012 Q3 2013 Q3 2012 Incoming orders 836.6 992.8 210.8 289.4 Sales revenues 863.5 810.5 304.3 279.3 67.7 50.1 24.2 19.9 EBIT Weaker order intake in Q3 due to order placement delays; improvement in Q4 expected EBIT margin increased from 6.2% (9M 2012) to 7.8% (9M 2013) due to solid order execution and economies of scale from higher volume © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 10
  11. 11. APPLICATION TECHNOLOGY Strong margins in Q3 in € m 9 months 9 months 2013 2012 Q3 2013 Q3 2012 Incoming orders 421.0 406.8 95.1 103.6 Sales revenues 390.0 396.7 133.6 132.2 43.4 37.9 16.1 12.3 EBIT Book-to-bill at 1.1 Sales increase in Q3 in line with expectations EBIT margin reached 12% level in Q3 © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 11
  12. 12. MEASURING AND PROCESS SYSTEMS Stronger order momentum in Q3 in € m 9 months 9 months 2013 2012 Q3 2013 Q3 2012 Incoming orders 445.9 475.8 161.5 141.3 Sales revenues 420.9 482.8 147.2 159.0 27.0 40.4 10.7 17.6 EBIT Order intake improved in Q3 across all machinery activities; book-to-bill at 1.1 Pronounced sales decline at Cleaning and Filtration Systems due to selective order intake in 2012 Earnings decrease due to significantly lower sales volume, capacity reductions and structural changes at Cleaning and Filtration Systems; one-offs in Q3 and Q4 © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 12
  13. 13. CLEAN TECHNOLOGY SYSTEMS Book-to-bill at 1.3 in € m 9 months 9 months 2013 2012 Q3 2013 Q3 2012 Incoming orders 94.0 78.9 36.6 15.7 Sales revenues 71.7 67.5 29.3 23.7 3.1 2.0 1.8 1.3 EBIT Incoming orders 19% above previous year´s level Strong earnings improvement despite start-up costs in energy efficiency activities © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 13
  14. 14. PASSENGER CAR SALES DEVELOPMENT JANUARY – SEPTEMBER 2013/12 Change year-over-year in % 21 China 8 USA -1 Brazil -3 new EU countries -4 Western Europe -5 Japan -6 Germany -7 Russia -8 India -10 -5 0 © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 5 10 15 20 25 14
  15. 15. FIRST UPWARD REVISION OF MARKET EXPECTATIONS SINCE SIX QUARTERS China, Brazil, India, Thailand, Malaysia & Indonesia with expected LV production growth >8% CAGR in % 110 100 90 80 70 60 50 40 30 20 10 0 79.2 1.9 16.6 81.8 1.5 18.5 86.6 1.6 20.7 101.7 2.2 3 25.2 26.6 10 24.2 25.0 3 97.8 1.8 92.5 1.7 23.1 21.8 21.7 22.6 23.3 20.2 21.7 22.9 23.4 4 19.3 19.4 19.6 20.7 21.5 22.7 23.7 24.5 5 2012 2013 2014 2015 2016 2017 America Europe Asia (without China) © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 China Other Source: own estimates, PwC Last update: October 2013 15
  16. 16. SERVICE BUSINESS Significant potential in modernization business Δ in % 9 months 2013 Sales revenues (in € m) In % of group sales 9 months 2012 382.8 362.6 5.6 21.9 20.6 1.3 ppt Service mix 9 months 2013 15% Significant modernization potential, e.g. interior painting, upgrades and refurbishment Stricter environmental regulations, e.g. in China 30% 55% Modifications and upgrades Spare parts and repair Maintenance, assessments, seminars © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 16
  17. 17. OUTLOOK: FURTHER MARGIN EXPANSION AHEAD Sales in € m 2,400 2,4002,600 Incoming orders in € m 1,922 1,782 1,460 1,078 2009 2011 2012 2013e 1,642 1,464 1,217 1,261 2010 2,685 2,597 2,3002,500 1,185 2005 2006 2007 2008 2009 2010 2011 2012 2013e EBIT margin / EBIT in € m 7.5-8% 7.4% 176.9 5.5% 106.5 2.9% 0.5% 5.7 36.6 2009 2010 © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 2011 2012 2013e 17
  18. 18. SUMMARY 2013 on track, EBIT margin reached 7.7% after first 9 months 2013 Order momentum to improve in Q4 Continued growth potential for global automotive industry, pipeline is filling up again Cash flow expected to improve considerably in 2013/2014, free cash flow should exceed € 70 m p.a. in 2013/2014 © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 18
  19. 19. FINANCIAL CALENDAR 02/25/2014 04/30/2014 05/06/2014 05/09/2014 07/31/2014 11/05/2014 CONTACT: Preliminary figures for the fiscal 2013: press conference Annual general meeting, Bietigheim-Bissingen Interim report for the first quarter of 2014 Investors' day, Bietigheim-Bissingen Interim financial report for the first half of 2014 Interim report for the first nine months of 2014 Dürr Aktiengesellschaft Günter Dielmann Corporate Communications & Investor Relations Carl-Benz-Str. 34 74321 Bietigheim-Bissingen Germany Phone E-mail +49 7142 78-1785 investor.relations@durr.com © Dürr Aktiengesellschaft, CCI, Conference Call – Q3, November 6, 2013 19
  20. 20. WELCOME DÜRR AKTIENGESELLSCHAFT CONFERENCE CALL RESULTS JANUARY – SEPTEMBER 2013 Ralf W. Dieter, CEO Ralph Heuwing, CFO Bietigheim-Bissingen, November 6, 2013 www.durr.com

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