conference call results jan.– sept. / q3 2012 · conference call results jan.– sept. / q3 2012...
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CONFERENCE CALLRESULTS JAN.– SEPT. / Q3 2012
DÜRR AKTIENGESELLSCHAFT
Bietigheim-Bissingen, November 6, 2012
WELCOME
Ralf W. Dieter, CEORalph Heuwing, CFO
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 could 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.
2© Dürr AG, CCI, CC Q3, November 6, 2012
BOOK TO BILL RATIO AT 1.1
Incoming orders development as expected, decrease in Application Technology and Cleaning Filtration only
Project pipeline continues to be strong despite weaker macro-economic situation
Continued sales increase in Q3
Order backlog secures utilization well until first half of 2014
3© Dürr AG, CCI, CC Q3, November 6, 2012
€ m 9 months
20119 months
2012∆ Q3 2011 Q3 2012 ∆
Incoming orders 2,066.5 1,954.3 -5.4% 866.0 550.0 -36.5%
Sales revenues 1,307.3 1,757.5 34.4% 523.8 594.2 13.4%
Orders on hand (09/30) 2,122.2 2,332.1 9.9% 2,122.2 2,332.1 9.9%
Q3 ORDER INTAKE LEVEL ACCORDING TO PLAN
4
162 179 169 130
275 244 294
466
336 325379
28978 69 83
65
97 127
155
182
116 166137
10480 101 100
152
144 165
159
189
149160
175
141
1813 22 17
26 21
35
29
1728
35
16
0
100
200
300
400
500
600
700
800
900
Q 42009
Q 12010
Q 22010
Q 32010
Q 42010
Q 12011
Q 22011
Q 32011
Q 42011
Q 12012
Q 22012
Q 32012
CleanTechnologySystems
Measuring andProcessSystems
ApplicationTechnology
Paint andAssemblySystems
339362 375
364
557
643
541
866
618679
725
550
© Dürr AG, CCI, CC Q3, November 6, 2012
€ m
INCOMING ORDERS: 9 MONTHS 2012 VS. 9 MONTHS 2011
€ m
Strong European businessChina catches up in Q3
5© Dürr AG, CCI, CC Q3, November 6, 2012
-5%
-33%
-5%
+44%
+32%
-47%
2,066.5
781.9
437.8
232.8
448.0
165.9
1,954.3
522.4414.8
336.0
593.5
87.6
0
500
1,000
1,500
2,000
2,500
Total China America Germany Europe w/oGermany
Asia (w/o China),Africa, Australia
9 months 2011
9 months 2012
ORDER INTAKE: HEALTHY REGIONAL SPLITRolling 12 months comparison
Emerging markets share above 50%
China still most important single market
59%(57%)
6
23.3%
(38.2%)
7.3%
(7.8%)
24.3%
(20.6%)
28.6%
(21.6%)
16.5%
(11.8%)32.0%
(27.3%)
7.4%
(9.2%)
25.3%
(20.7%)
23.1%
(25.8%)
12.2%
(17.0%)
Mature
markets Emerging
markets *
47%
(35%) 53%
(65%)
Germany
Rest of Europe incl. Eastern Europe
North and South America
Asia (ex China), Africa, Australia
China
* Asia (ex Japan), Mexico, Brazil, Eastern Europe
Incoming orders rolling 12 months
2012 (2011)
Incoming orders rolling 12 months
2012 (2011)
Sales revenuesrolling 12 months
2012 (2011)
© Dürr AG, CCI, CC Q3, November 6, 2012
NET INCOME DOUBLED DUE TO STRONG SALES AND MODERATE SG&A INCREASE
Q3 gross margin increases to 19.0% due to high utilization and better order mix (Q1: 16.4%/Q2: 17.6%)
Moderate increase of SG&A costs (+20%) well below sales increase
Q3 EBIT margin at 7.8%
Financial result weaker at € -23.2 m (€ -15.1 m) due to inclusion of Campus refinancing andone time costs (€ 5.3 m)
7
€ m9 months
20119 months
2012∆ Q3 2011 Q3 2012 ∆
Gross profit on sales 228.8 311.0 35.9% 88.4 112.9 27.7%
EBITDA 78.4 138.6 76.8% 35.0 53.5 52.9%
EBIT 63.5 118.9 87.2% 29.6 46.5 57.1%
Net income 34.6 71.3 106.1% 18.6 27.3 46.8%
© Dürr AG, CCI, CC Q3, November 6, 2012
TEMPORARY INCREASE IN NWCCash flow/free cash flow
Strong cash flow improvement in Q3, NWC reduction expected in Q4
8
€ m9 months
20119 months
2012Q3
2011Q3
2012
EBT 48.4 95.7 24.7 36.2
Depreciation and amortization of non-current assets 14.9 19.8 5.4 6.9
Interest result 15.5 23.5 5.0 10.4
Income taxes paid -7.3 -13.2 -3.0 -4.4
∆ Provisions 2.3 -10.4 2.7 4.8
∆ Net working capital -48.2 -147.6 -15.0 -27.6
Other 2.6 13.8 33.5 20.0
Cash flow from operating activities 28.2 -18.4 53.3 46.3
Interest paid (net) -20.5 -19.7 -20.3 -17.6
Capital expenditures -12.4 -21.1 -4.4 -6.0
Free cash flow -4.7 -59.2 28.6 22.7
© Dürr AG, CCI, CC Q3, November 6, 2012
DWC expected to be back in target range (20-25 days) at year end 2012
NWC: INCREASE ALONG WITH BUSINESS EXPANSION
9
09/30/2011 12/31/2011 09/30/2012
NWC in € m 77.3 32.6 177.7
DWC (Days Working Capital) 16.0 6.1 27.3
DSO (Days Sales Outstanding) 126.8 117.2 115.7
© Dürr AG, CCI, CC Q3, November 6, 2012
WIP AND PROGRESS BILLINGS
WIP approaches normalized range of +/- € 50 m
10
€ m 09/30/2011 12/31/2011 09/30/2012
Assets
Work in process from contracts (WIP) 922.2 936.8 1,479.5
Progress billings -606.2 -639.2 -1,092.0
WIP in excess of billings 316.0 297.6 387.5
Liabilities
Work in process from contracts (WIP) -937.2 -1.221.9 -1,261.9
Progress billings 1,371.5 1,650.1 1,713.2
Billings in excess of WIP 434.3 428.2 451.3
Machinery business
WIP -20.7 -23.1 -34.0
Progress billings 18.4 18.6 33.0
Billings in excess of WIP -2.3 -4.5 -1.0
1
2
4
© Dürr AG, CCI, CC Q3, November 6, 2012
3
Progress billings were € 63m higher than future receivables1) on September 30, 2012
This will lead to a future cash outflow of € 63mHowever, cash flow should benefit from higher earnings/revenues
1) These future receivables are not included in trade receivables
WIP AND PROGRESS BILLINGS
11
€ m 09/30/2011 12/31/2011 09/30/2012
Balance: total WIP less total progress billings
- - -116.0 -126.1 -62.8
Prepayments (liabilities)
+ 452.7 446.8 484.32 3
421
© Dürr AG, CCI, CC Q3, November 6, 2012
Equity ratio expected to increase during the next quarters
Positive net financial status expected at FY end
1) annualized
STRONG ROCE DESPITE HIGH NWC LEVEL
12
€ m 09/30/2011 12/31/2011 09/30/2012
Equity in € m 341.0 364.3 411.3
Equity ratio in % 22.7 21.9 23.5
Net financial status in € m 0.9 51.8 -25.8
Cash in € m 235.0 298.6 249.7
Gearing in % -0.3 -16.6 5.9
ROCE1) in % 21.3 28.4 32.1
© Dürr AG, CCI, CC Q3, November 6, 2012
ROCE CLEARLY ABOVE COST OF CAPITAL
Dürr’s business model favors low capital employed
Strong focus on NWC management
Only slight CE increase since 2006 despite strong business expansion
13
2006 2007 2008 2009 2010 20119 months
2012
EBIT in € m 33.1 55.7 72.7 5.7 36.6 106.5 118.9
Capital employed in € m 420.1 378.8 432.1 356.3 356.7 374.8 494.1
NWC in € m 154.7 128.9 151.8 57.4 27.3 32.6 177.7
DWC 40.9 31.4 34.1 19.2 7.8 6.1 27.3
ROCE in % 7.9 14.7 16.8 1.6 10.3 28.4 32.11)
© Dürr AG, CCI, CC Q3, November 6, 2012
1) annualized
0
1
2
3
4
5
6
05
101520253035
2006 2007 2008 2009 2010 2011 2012e
ROCE in % CE turnover
PAINT AND ASSEMBLY SYSTEMS: INCOMING ORDERS ON 2011 RECORD LEVEL
Book to bill ratio at 1.2
EBIT margin at record high in Q3 2012 (7.0%)
14
€ m9 months
20119 months
2012∆
Incoming orders 1,004.3 992.8 -1.1%
Sales revenues 580.9 810.5 39.5%
EBIT 26.1 49.1 88.1%
© Dürr AG, CCI, CC Q3, November 6, 2012
APPLICATION TECHNOLOGY: STRONG EBIT DEVELOPMENT
Q3 incoming orders should have bottomed out, strong pipeline in brownfield projects
Good earnings improvement due to high utilization and improved margin realization, EBIT margin reached 9.2% in Q3
15
€ m 9 months
20119 months
2012∆
Incoming orders 464.7 406.8 -12.5%
Sales revenues 281.3 396.7 41.0%
EBIT 14.9 37.2 149.7%
© Dürr AG, CCI, CC Q3, November 6, 2012
MEASURING AND PROCESS SYSTEMS: CONTINUED EARNINGS MOMENTUM
Normalized order intake level in Q3, selective order intake in Cleaning and Filtration
Incoming orders at Balancing and Assembly Products +15%
Earnings improvement in both business units; EBIT margin reaches 11.1% in Q3
16
€ m 9 months
20119 months
2012∆
Incoming orders 513.4 475.8 -7.3%
Sales revenues 388.0 482.8 24.4%
EBIT 22.2 40.4 82.0%
© Dürr AG, CCI, CC Q3, November 6, 2012
CLEAN TECHNOLOGY SYSTEMS: BOOK TO BILL RATIO AT 1.2
Order intake temporarily weaker in Q3; several VAM-RTO in the pipeline, higher order intake expected in Q4
EBIT margin at 5.5% in Q3 despite expansion costs in energy efficiency business
17
€ m9 months
20119 months
2012∆
Incoming orders 84.0 78.9 -6.1%
Sales revenues 57.1 67.5 18.2%
EBIT 3.0 1.9 -36.7%
© Dürr AG, CCI, CC Q3, November 6, 2012
EXPANDING SERVICE BUSINESS
18
2008 2009 2010 20119 months
20119 months
2012
Sales revenues in € m 395.9 263.3 362.0 445.4 314.0 362.6
Sales revenue in % of group sales 24.7 24.4 28.7 23.2 24.0 20.6
© Dürr AG, CCI, CC Q3, November 6, 2012
0
1000
2000
3000
4000
5000
6000
7000
8000
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012e
Example Application Technology: Number of paint robots in the installed base
LARGE SERVICE POTENTIAL IN THE EMERGING MARKETS
19© Dürr AG, CCI, CC Q3, November 6, 2012
Service in % of total sales by country
0
5
10
15
20
25
China India Russia Brazil Mexico Group
MARKET: STRONG PASSENGER CAR SALESSeptember 2012/2011
Source: VDA (German carmakers´ association)
20
Change year-over-year in %
-8
-2
0
6
9
10
14
15
42
-10 0 10 20 30 40 50 60
Western Europe
Germany
new EU countries
Brazil
China
India
Russia
USA
Japan
© Dürr AG, CCI, CC Q3, November 6, 2012
CONTINUED STRONG EMERGING MARKETS GROWTH EXPECTED
21
Emerging markets contribute 90% to worldwide automobile production growth 2011-2016
CAGR in %
17.3 19.5 20.2 21.4 22.7 23.6
19.9 19.2 19.7 20.9 22.1 23.2
19.6 21.6 22.5 23.9 24.6 25.415.3
16.5 18.921.1
23.124.7
2.52.4
2.62.7
2.82.9
0
10
20
30
40
50
60
70
80
90
100
110
2011 2012 2013 2014 2015 2016
America Europe Asia (without China) China otherSource: PwC
Last update: October 2012
m units
6.4
3.0
10.0
5.3
3.1
74.679.2
83.990.0
95.399.8
© Dürr AG, CCI, CC Q3, November 6, 2012
2009 2010 2011 2012e
EBIT margin (EBIT in € m)
(5.7)
(36.6)
2.9%
0.5%
5.5%
6.5 - 7%
1,2171,460
1,7821,464
1,185
1,642
2,685 2,500
2005 2006 2007 2008 2009 2010 2011 2012e
1,0781,261
1,922
>2,300
2009 2010 2011 2012e
(106.5)
OUTLOOK: ON THE WAY TO 7% EBIT MARGINOngoing growth and profit improvement expected
22
Incoming orders in € mSales in € m
© Dürr AG, CCI, CC Q3, November 6, 2012
SUMMARY
23© Dürr AG, CCI, CC Q3, November 6, 2012
9 months within expectations, EBIT margin reached 7.8% in Q3
Positive long term market outlook despite current macro-economicslowdown
Healthy project pipeline, no signs for a deterioration of business
Positive 2012 outlook supported by order backlog, incoming orders and project pipeline. Margin goal of 6.5 - 7% within reach and conservative
FINANCIAL CALENDAR
Contact: Dürr AktiengesellschaftGünter DielmannCorporate Communications & Investor RelationsCarl-Benz-Str. 3474321 Bietigheim-BissingenGermany
Phone +49 7142 78-1785E-Mail [email protected]
11/13/12 - 11/14/12 UBS Conference, London
12/04/12 - 12/07/12 Berenberg Conference, Pennyhill
01/14/13 - 01/16/13 Commerzbank German Investment Seminar, New York
01/22/13 German Corporate Conference by Cheuvreux, Frankfurt
24© Dürr AG, CCI, CC Q3, November 6, 2012
www.durr.comwww.durr.com
CONFERENCE CALLRESULTS JAN.– SEPT. / Q3 2012
DÜRR AKTIENGESELLSCHAFT
Bietigheim-Bissingen, November 6, 2012
Ralf W. Dieter, CEORalph Heuwing, CFO