Results Q3 and 9M 2014 November 11, 2014 Reference (apr02)

Results Q3 and 9M 2014
November 11, 2014
Cem Peksaglam (CEO) – Günther C. Binder (CFO)
Reference (apr02)
Overview
Overview Q3/14
and 9M/14
Financials Q3/14
and 9M/14
Outlook
Reference (apr02)
2
Highlights – 9M/14: Increase of revenues and profitability
At a glance






Strong revenue growth, before FX-effects 9M/14 +11% yoy
Favorable regional and product mix lead to revenue +14% yoy in Q3/14
First time ever triple digit in absolute 9M EBIT (EUR 104 m)
Ongoing cost and process optimization increases profitability
Small positive free cash flow in Q3 and 9M/14
Increase of profit guidance, confirmation of revenue guidance for FY 2014
Q3/14: Strong increase in revenue and earnings




Revenue: +14% yoy to EUR 316 m (adjusted for currency effects : +14%); Q3/qoq -4%
EBITDA: +34% yoy to EUR 55 m; margin: 17.4% (Q3/13: 14.3%)
EBIT: +51% yoy to EUR 41 m; margin: 12.7 % (Q3/13: 9.6%)
EPS: +57% yoy to EUR 0.38
9M/14: Revenue and earnings at all-time high
 Revenue: +9% yoy to EUR 936 m (adjusted for currency effects: +11%)
 EBITDA: +34% yoy to EUR 148 Mio. Euro; margin: 15.8% (9M/13: 12.9%)
 EBIT: +55% yoy to EUR 104 Mio. Euro; margin: 11.1% (9M/13: 7.8%)
 EPS: +65% yoy to EUR 0.98
Again record revenue and earnings in Q3 and 9M
Reference (apr02)
3
Q3 and 9M comparison
Revenue and EBIT margin Q3 and 9M (2010–2014)
Revenue in € million; EBIT margin as %
Revenue
EBIT
+14%
+61%
+9%
+184%
+2%
+27%
Revenue in € million; EBIT margin as %
Revenue
EBIT
+9%
+70%
+6%
+12%
+32%
Continuous and significant increase in revenue and earnings
Reference (apr02)
4
+308%
Q3/14: Strong growth in all core markets and product sales
(FX effect insignificant)1
Europe2
(€ million)
Americas2
+14% (+14%)
202.1
Q3/13
230.1
Q3/14
Light equipment3
(€ million)
+12% (+12%)
94.4
Q3/13
105.9
Q3/14
(€ million)
+16% (+15%)
(€ million)
76.8
66.3
Q3/13
Q3/14
+16% (+13%)
8.0
9.3
Q3/13
Q3/14
Compact equipment3
(€ million)
+25% (+25%)
Services3
(€ million)
-0% (-0%)
144.2
115.4
Q3/13
Q3/14
1
In brackets: adjusted for currency effects
Nominal, after cash discounts
3 Nominal, before cash discounts
2
Reference (apr02)
Asia-Pacific2
5
70.7
70.7
Q3/13
Q3/14
9M/14: All regions/business segments positive (before FX)1
Europe2
(€ million)
Americas2
+11% (+12%)
618.3
9M/13
689.3
9M/14
Light equipment3
(€ million)
308.7
9M/13
+0% (+4%)
309.3
9M/14
(€ million)
+1% (+6%)
(€ million)
220.2
217.5
9M/13
9M/14
+0% (+7%)
26.5
26.6
9M/13
9M/14
Compact equipment3
(€ million)
+17% (+18%)
Services3
(€ million)
+6% (+7%)
441.4
377.7
9M/13
9M/14
1
In brackets: adjusted for currency effects
Nominal, after cash discounts
3 Nominal, before cash discounts
2
Reference (apr02)
Asia-Pacific2
6
187.3
198.5
9M/13
9M/14
9M/14: Balanced revenue mix
Industries
As % (previous year)
Business segments
As % (previous year)
Regions
As % (previous year)
0
Construction and various
industries 64 (65)
Light Equipment 33 (35)
Europe 74 (72)
Agriculture 15 (13)
Compact Equipment 46 (43)
Americas 23 (25)
Services 21 (21)
Services 21 (21)
Asia-Pacific 3 (3)
Ag business grew by 20%
Temporary shift in mix in favor of Europe
Reference (apr02)
7
Overview
Overview Q3/14
and 9M/14
Financials Q3/14
and 9M/14
Outlook
Reference (apr02)
8
Q3/14: A highly profitable quarter
Income statement (extract)
(€ million)
Q3/14
As % of
revenue
Q3/13
As % of
revenue
Change
in %
Revenue
316.2
100.0
276.3
100.0
143
Gross profit
95.8
30.3
86.7
31.4
10
Sales and service expenses
41.8
13.2
38.4
13.9
9
Research and development
expenses
7.3
2.3
6.6
2.4
10
General administrative expenses
15.9
5.0
14.3
5.2
11
Operating expenses1
65.0
20.6
59.3
21.5
10
EBITDA
55.1
17.4
41.2
14.9
34
EBIT
40.1
12.7
26.52
9.6
51
Net profit
26.5
8.4
16.9
6.1
57
Net profit per share in €
0.38
–
0.24
–
1
without other income/expenses
Q3/13 incl. PPA = Purchase Price Allocation on EBIT: EUR -0.9 million (Q3/14: no disclosure anymore)
3 before currency effects: +14%
2
Reference (apr02)
9
9M/14: Record in revenue and earnings
Income statement (extract) and number of employees
(€ million)
9M/14
As % of
revenue
9M/13
As % of
revenue
Change
in %
Revenue
936.2
100.0
862.4
100.0
93
Gross profit
282.4
30.2
261.4
30.3
8
Sales and service expenses
125.1
13.4
126.0
14.6
-1
Research and development
expenses
21.1
2.3
20.6
2.4
3
General administrative expenses
46.6
5.0
48.8
5.7
-5
Operating expenses1
192.8
20.6
195.5
22.7
-1
EBITDA
148.1
15.8
110.9
12.9
34
EBIT
103.5
11.1
66.92
7.8
55
Net profit
69.0
7.4
41.8
4.8
65
Net profit per share in €
0.98
–
0.60
–
65
4,271
–
4,180
–
2
Number of employees
1
without other income/expenses
9M/13 incl. PPA = Purchase Price Allocation on EBIT: EUR -1.7 million (9M/14: no disclosure anymore)
3 before currency effects: +11%
10
Reference (apr02)
2
Strict cost control
Revenue in € million
Cost as % of revenue
1
Revenue
Operating expenses
Sales&Service exp.
9M/12: 23%
350
300
274
284
250
22%
200
150
22%
24%
14%
14%
6%
6%
6%
50
2%
Q1/12
1
2%
Q2/12
329
328
297
276
257
26%
16%
5%
16%
3%
3%
Q3/12
Q4/12
Q1/13
292
21%
22%
19%
14%
14%
14%
5%
5%
6%
5%
2%
Q2/13
2%
Q3/13
2%
Q4/13
2%
Q1/14
without other income/expenses
Reduction of operating cost ratio below level of previous years
Reference (apr02)
40%
35%
22%
14%
7%
3%
316
30%
23%
100
0
9M/14: 21%
21%
15%
Gen. admin. exp.
9M/13: 23%
279
254
R&D exp.
11
21%
25%
20%
13%
13%
5%
5%
2%
Q2/14
2%
15%
10%
5%
Q3/14
0%
9M/14: Development of profit per region
EBIT-change by region 9M/14 vs. 9M/13
(€ million)
120
+0.7
-8.6
+42.1
+2.5
Europe
Americas
Asia-Pacific
Europe
Americas
Asia-Pacific
103.5
100
80
66.9
60
40
20
0
EBIT 9M/13
9M/14 vs. 9M/13
Consolidation
EBIT 9M/14
Total
Revenue
+12%
+1%
+0%
+9%
EBIT
+91%
+15%
+221%
+55%
12.8% (7.5%)
8.8% (7.8%)
3.6% (1.1%)
11.1% (7.8%)
EBIT Margin (9M/13)
Reference (apr02)
12
9M/14: Investments and cash flow development
Investments
(€ million)
Depreciation
Operative cash flow
+9%
67.6
87.4
73.6
-13%
-84%
76.0
+1%
44.1
(€ million)
(€ million)
(€ million)
Free cash flow
21.7
44.6
3.6
9M/13
9M/14
9M/13
9M/14
9M/13
9M/14
Investments exceed depreciation, positive free cash flow
Reference (apr02)
13
9M/13
9M/14
9M/14: Working Capital development
Working Capital 9M/10–9M/14
(€ million)
Inventories
Trade receivables
Trade payables
+12%
523
440
350
259
154
467
Sept. 30, 2010
-47
200
+18%
411
+39%
Sept. 30, 2014
181
173
130
176
+11%
351
349
Sept. 30, 2011
Sept. 30, 2012
Sept. 30, 2013
-66
-64
-64
43.3%
42.2%
244
-89
Working Capital ratio (3M annualized revenue)
33.0%
35.2%
Working Capital increase in order to shorter delivery times
Reference (apr02)
14
41.3%
9M/14: Overview of cash flow positions vs. year-end 2013
Change in cash and cash equivalents 9M/14 vs. year-end 2013
(€ million)
128.8
-52.8
76.0
-72.4
3.6
15.5
-177.2
Cash and
cash
equivalents
Dec. 31, 13
-28.1
26.6
18.0
-198.8
Cash flow
Working
from
Capital
operating
Investments
activities
before
Working
Capital
Investments
(Gross cash flow)
Cash flow
from
operating
Activities
after
Working
Capital
investments
Cash flow
from
investment
activities
Free
cash flow
Dividend
Cash flow
from further
financing
activities
and
Effect of
Exchange
rates
Cash and
cash
equivalents
Sept 30, 14
Net
financial
position
Dec. 31, 13
Net
financial
position
Sept 30, 14
Cash flow from operating activities before Working Capital investments EUR 128.8 m
Free cash flow EUR 3.6 m, expected to remain positive in FY 2014
Reference (apr02)
15
9M/14: Gearing and equity
Equity, net debt and gearing 9M/10 – 9M/14
(€ million)
Net financial debt
Equity before minority interests
990
1.000
900
Gearing as a %
871
816
917
21%
23%
924 (68%)
(67%) 25%
20%
20%
800
700
15%
600
500
400
300
214
195
200
100
10%
8%
2 0%
-7%
199
0%
0
9M/10
9M/11
9M/12
9M/13
High equity ratio of 67%, reduction of net debt by 7%.
Reference (apr02)
5%
71
16
9M/14
Share price +44% since Jan. 1, 2014
Share price performance: Jan. 1, 2014 – Nov. 7, 2014
1
1
Manitou, Haulotte, Palfinger, Caterpillar,
Terex, Ramirent, Cramo, Atlas Copco,
Bauer, Deutz.
Key figures share
in €
2010
2011
2012
2013
9M/13
9M/14
Earnings per share
0.34
1.22
0.77
0.87
0.60
0.98
Dividend per share
0.17
0.50
0.30
0.40
End of period
13.00
9.55
10.35
11.49
11.00
15.15
High
13.20
13.49
13.45
12.75
12.48
Low
7.63
8.35
9.06
9.24
911.8
669.8
725.9
805.6
Market capitalization (in € m)
Reference (apr02)
ISIN / WK
DE000WACK012 / WACK01
Reuters /
Bloomberg
WACGn.DE / WAC GR
Indices
SDAX, DAXplus family, CDAX,
GEX, Classic All Shares
18.00
Share
Prime All Share
9.24
11.73
Total shares
70.140.000
771.5
1,062.6
Shareholder
structure
63% Family; 37% Free float
(thereof management: 0.5)
17
Overview
Overview Q3/14
and 9M/14
Financials Q3/14
and 9M/14
Outlook
Reference (apr02)
18
Outstanding new products („USP“)
Excavator 803 dual power and power unit HPU8
Vertical Digging System (VDS) for compact excavators

Efficient: VDS saves 25% of material and time when removing and
filling surfaces due to exact vertical digging

Upright seating position for greater stability, more productivity and
fatigue-free working

Simple operation at the push of a button

Electric and diesel engine; 1 model for internal and external jobs

Same performance in diesel and electro-hydraulic operation

HPU specially designed for excavator application

No limitation of working movements, e.g. 360° turning radius
Electric wheel loader WL20e
Battery-powered rammers AS 30 & AS 50

No exhaust emissions and low noise emissions: protecting the user
and the environment

100% emission-free work; reduction of noise emissions

Electric drive system: work application of up to five hours

Cable-free

Same performance as the conventional model WL20

Compaction performance comparable to conventional model


Up to 60% lower operating costs plus less maintainance
Lower energy costs of up to 48%, additional cost advantages in
maintenance and service intervals
Reference (apr02)
19
Systematic implementation of internationalization strategy
Wacker Neuson starts skid steer loader production in the USA
At a glance

Skid steer loaders SW 24 (1.1 tons) and
SW 28 (1.4 tons)

Compact track loaders ST 35 (1.6 tons)
and ST 45 (2.1 tons)
Reference (apr02)
20

First production of compact equipment
outside of Europe

Production within the existing facility in
Menomonee Falls near Milwaukee

US is the largest market for skid steer
loaders (“in the region, for the region”)

Outstanding product, being co-developed
by US-Europe-R&D team; designed to fit
local customer requirements and “taste”

Relocation from Austria (Hörsching) to the
US allows expansion of dumper and
excavator production
Raised earnings forecast 2014
Revenue and Margins 2013–2014e
Wacker Neuson 2014e
(Revenue in € billion)
1.400,0
+∿10%
1.200,0
1.25 – 1.30
1.25 – 1.30
30,0
1.16
25,0
1.000,0
20,0
800,0
EBITDA margin 14.5–15.5%
EBITDA margin 13–14%
15,0
EBITDA margin 13.2%
600,0
EBIT margin 8–9%
10,0
400,0
5,0
200,0
0,0
0,0
2013
Reference (apr02)
Previous
Guidance 2014
Further recovery of US construction market
Expand international footprint
New technologies, innovations
Increasing market penetration (e.g.
leveraging cross selling opportunities)
+ Focus on diversification (target groups)
+ Tap on synergies, higher productivity
+ Permanent search for attractive M&A
opportunities or alliances
EBIT margin 10–11%
EBIT margin 8.2%
+
+
+
+
Guidance 2014
21
Risks:
 Market insecurities
 Weakness of demand in Central Europe
 Slow down of European ag sector!
Appendix
Reference (apr02)
22
Financial calendar and IR contact
Financial calendar
November 11, 2014 Publication of nine-month report 2014
March 16,
2015 Publication of financial results 2014
May 12
Publication of first-quarter report 2015
May 27
AGM, Munich
August 04
Publication of half-year report 2015
November 12
Publication of nine-month report 2015
Numerous international trade fairs, roadshows and conferences
IR contact
Investor Relations Department
Preussenstrasse 41, 80809 Munich, Germany
Phone: +49 – 89 – 35402 – 173, Fax: +49 – 89 – 35402 – 298
[email protected]
Reference (apr02)
23
Disclaimer
Cautionary note regarding forward-looking statements
 The information contained in this document has not been independently verified and no
representation or warranty expressed or implied is made as to, and no reliance should be placed
on, the fairness, accuracy, completeness or correctness of this information or opinions contained
herein.
 Certain statements contained in this document may be statements of future expectations and
other forward looking statements that are based on management‘s current view and
assumptions and involve known and unknown risks and uncertainties that could cause actual
results, performance or events to differ materially from those expressed or implied in such
statements.
 None of Wacker Neuson SE or any of its affiliates, advisors or representatives shall have any
liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of
this document or its content or otherwise arising in connection with this document.
 This document does not constitute an offer or invitation to purchase or subscribe for any
securities and neither it nor any part of it shall form the basis of or be relied upon in connection
with any contract or commitment whatsoever.
Reference (apr02)
24
`