Earnings conference call. Q4 and Full year 2014

Transcription

1 Earnings conference call Q4 and Full year 2014 Bo Annvik, CEO / Andreas Ekberg, CFO 12 February

2 Agenda Business Highlights Market Update Sales Financials Restructuring Outlook 2

3 Business Highlights Q Sales growth of 10% (currency adjusted) with net sales reaching SEK 1,092 (908) million. Operating margin of 9.3 (7.3) %, excluding oneoff items. Operating income, excluding one-off items, increased to SEK 101 (66) million. 3

4 Business Highlights Full year 2014 Disc brake contracts with several European trailer manufacturers with an estimated value of SEK 650 million from 2014 to Increased market share for disc brakes in Europe. Last phase of the restructuring program now being implemented after German union negotiations being finalized. New R&D center in Pune, India. Construction of the new R&D center at MIRA test track in UK started and finalized in Q

5 Business Highlights Full year 2014 Sales growth of 8% (currency adjusted) with net sales reaching SEK 4,380 (3,920) million. Operating margin of 9.3 (7.3) %, excluding one-off items. Operating income, excluding one-off items, SEK 408 (281) million. Earnings per share increased to SEK 2.32 (0.80). Cash flow from operations of SEK 435 (282) million. Proposed dividend of SEK 3.00 (2.00) per share. 5

6 Stable platform created Past Focus on footprint consolidation Present Improving and stabilizing the platform Future Profitable growth

7 2014 vs. long term objectives OPERATING MARGIN ORGANIC GROWTH NET DEBT/EQUITY DIVIDEND 9.3% 8% < SEK 7

8 Market update 8

9 Build rates Heavy truck Thousands of units North America official build rates increased by 22% in 2014 compared to The North American market is expected to increase by 12% in China Europe North America India Brazil Europe official build rates decreased by 9% in 2014 compared to The European market is expected to grow with 4% in Source: The data concerning trucks is based on statistics from JD Powers, unless otherwise stated. The data on the trailer market concerning Europe is based on statistics from CLEAR; the data on trucks and trailers in North America is based on statistics from ACT; and the trailer data from South America and Asia is based on local sources. 9

10 Build rates - Trailer Thousands of units North America official build rates indicating a increase of 17% in 2014 compared to The North American market is expected to increase with 4% in China Europe North America India Brazil European build rates are 8% higher in 2014 compared to The European market is expected to grow with 3% in Source: The data concerning trucks is based on statistics from JD Powers, unless otherwise stated. The data on the trailer market concerning Europe is based on statistics from CLEAR; the data on trucks and trailers in North America is based on statistics from ACT; and the trailer data from South America and Asia is based on local sources. 10

11 Sales 11

12 Sales, Haldex Group Currency adjusted growth of 10% in Q4 and growth of 8% in SEK m Net sales 1/13 2/13 3/13 4/13 1/14 2/14 3/14 4/14 Q4/14 Q4/ Net sales, SEK million 1, ,380 3,920 Growth, currency adjusted 10% 6% 8% 3% 12

13 Sales per region Europe North America SEK m SEK m SEK million Q4/14 Q4/13 change 1 Europe % North America % Asia & Middle East % South America % 1/13 2/13 3/13 4/13 1/14 2/14 3/14 4/14 1/13 2/13 3/13 4/13 1/14 2/14 3/14 4/14 SEK m Asia & Middle East SEK m South America SEK million change 1 Europe 1,522 1,386 6% North America 2,280 2,019 8% Asia & Middle East % South America % 1 currency adjusted 1/13 2/13 3/13 4/13 1/14 2/14 3/14 4/14 1/13 2/13 3/13 4/13 1/14 2/14 3/14 4/14 13

14 Sales per product line Foundation Brake: Wheel-end products for brake actuation and lining wear adjustment. SEK m Sales Air Controls: Products to dehumidify, clean and control compressed air in the brake system. 1/13 2/13 3/13 4/13 1/14 2/14 3/14 4/14 Foundation Brake Air Controls SEK million Q4/14 Q4/13 change change 1 Foundation Brake % 2,420 2,107 11% Air Controls % 1,960 1,813 3% 1 currency adjusted 14

15 Sales per customer category Largest growth in the truck category in Q4, mainly driven by good sales growth in North America. For the full year, the trailer category represents the largest growth, partly driven by increased disc brake revenue in Europe. 2014: 29% Truck 29% Trailer 42% Aftermarket SEK million Q4/14 Q4/13 change change 1 Truck % 1,276 1,117 10% Trailer % 1,269 1,087 13% Aftermarket % 1,835 1,716 3% 1 currency adjusted 15

16 Financials 16

17 Earnings Operating margin excluding one-off items at record high 9.3% in 2014, and at 9.3% also in Q4. SEK m Operating income & margin % Income Margin SEK Earnings per share 1/13 2/13 3/13 4/13 1/14 2/14 3/14 4/14 1/13 2/13 3/13 4/13 1/14 2/14 3/14 4/14 Q4/14 Q4/13 change change Operating income (excl one-off items), SEK million % % Operating income, SEK million % % Operating margin (excl. one-off items), % Operating margin, % Net income, SEK million % % Earnings per share, (excl one-off items), SEK % % Earnings per share, SEK % % 17

18 Sales & Operating Margin Sales, SEK m Operating Margin % 6.4% 6.4% 4.8% 6.0% 5.6% 5.6% 3.9% 5.8% 7.1% 8.4% 7.3% 8.1% 9.7% 10.1% 9.3% 12,0% 10,0% 8,0% 6,0% 4,0% 700 2,0% 600 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Q4-13 Q1-14 Q2-14 Q3-14 Q4-14 0,0% Sales Operating Margin 18

19 Statement of Financial Position Dec 2014 vs. Dec 2013 SEK million Dec 31 Dec 31 annual change Working capital % Intangible assets % Capital employed 1,963 1,855 +6% Total assets 2,936 2, % Equity 1,278 1, % Net debt % Equity ratio, % Net debt/equity ratio, % Contingent liabilities

20 Cash Flow Working Capital & Cash Conversion Days Working Capital, MSEK Cash Conversion Cycle, days Working Capital Cash Conversion Days SEK million Q4/14 Q3/14 Q2/14 Q1/14 Operating cash flow Cash flow after net investments excluding one-off items 20

21 Field inspection and replacement program One of the smaller product lines for actuators in North America. In November, Haldex launched a field inspection campaign due to a diaphragm that could get out of position. Based on a thorough analysis of the field inspection results, an additional root cause, that can occur during special conditions, has been identified. The field inspection campaign has been extended to include product replacements. The number of vehicles is approximately 20,000. The cost is estimated at SEK 65 million. Failure rate is estimated to 0.03 percent. 21

22 Restructuring program The final step in the program was completed with the German union negotiations. Annual savings of SEK 85 million and total costs of SEK 250 million, with cash effects of approximately SEK 100 million. SEK 240 million booked as one-off items, of which SEK 112 million in Two thirds of the payments remain. The German/Hungary relocation project will be carried out during 2015 and completed latest at the end of

23 Outlook 23

24 Market outlook 2015 North America High demand to continue in H1/15. Europe A couple of percentage points up. China Continue to be somewhat negative. India Good improvement. Brazil Weaker than the previous year. 24

25 Stable platform created Past Focus on footprint consolidation Present Improving and stabilizing the platform Future Profitable growth

26 Profitable Growth Future Profitable growth Product range Fill gaps in the product range on a regional basis. Extend product range with further variants where applicable. Aftermarket 2015 Follow vehicles over lifetime with competitive offerings. Extension of Reman business scope. 26

27 Profitable Growth cont. Future Profitable growth M&A Acquisitions to complement product range and/or build stronger customer base/ critical mass in selective markets. Simplify customer interface 2015 Extend and improve E-commerce platform with relevant solutions for different customer groups. Upgrade ERP system, stepwise approach. 27

28 Thank You! Questions? 28