SIX MONTHS REPORT, JAN JUN 2017mb.cision.com/Main/405/2306244/699395.pdf · MARKET DEVELOPMENT LMC...

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SIX MONTHS REPORT, JAN‐JUN 2017TELEPHONE/AUDIO CONFERENCE 12 JULY 2017, AT 11.00 CETTOMMY ANDERSSON, PRESIDENT AND CEO | HELENA WENNERSTRÖM, EVP AND CFO

SAVE THE DATE

CAPITAL MARKET DAY SEPTEMBER 21, 2017

AGENDA

1. Bulten in brief2. Market development3. Second quarter 20174. Going forward

4

BULTEN IS A LEADING SUPPLIER OF FASTENERS TO THE INTERNATIONAL AUTOMOTIVE INDUSTRY

VISION

FOOTPRINT

Bulten shall be the leading business partner and the most cost‐effectivesupplier of fasteners and services to the automotive industry. Bulten shall with empowered and dedicated people continuously develop its full service concept and actively launch innovations. Bulten shall develop long‐term relations based on professionalism and good business ethics.

BUSINESS CONCEPT FINANCIAL TARGETS

To grow stronger than the industry in averageOperating Profit (EBIT) > 7%Return on Capital Employed (ROCE) > 15%

Supporting the global automotive industry with state of the art fastener technology and services.

Corporate presentation

HEAD OFFICE

PRODUCTION

SALES

LOGISTICS

PRE DEVELOPMENT

PRODUCT DEVELOPMENT

STRONG CUSTOMER BASE AND RELATIONSHIPS WITH MAJOR VEHICLE OEMS AS WELL AS TIER 1 SUPPLIERS

75%Share of Bulten’s sale, YTD 2015 .

v

11%

TIER AUTOMOTIVE SUPPLIERS

OEMs LIGHT VEHICLES

76%

OEMs HEAVY VEHICLES

13%

Selection of customers. Share of Bulten’s sales YTD

28%

5SIX MONTHS REPORT, 2017

2. MARKET DEVELOPMENT

BULTEN MARKET SHARE DEVELOPMENT

Management estimates*:

Market share 17% of the European market of fasteners for the automotive industry 2016, flat versus 2015.

Market share of FSP contracts for the same market to be 60% 2016, flat versus 2015.

7

BULTEN MARKET SHARE DEVELOPMENT

45%56% 60% 60%

0%10%20%30%40%50%60%70%

Market share of European fastener FSPcontracts

2013

2014

2015

2016

* Based on data from EIFI (European Industrial Fasteners Institute)

11%14%

17% 17%

0%

5%

10%

15%

20%

Market share of total European fasteners

2013

2014

2015

2016

SIX MONTHS REPORT, 2017

MARKET DEVELOPMENT

LMC Automotive reports for automotive production in Europe, 2017:

Production of LV in 2017 up by 1.8% compared to 2016 Production of HCV (>15 t) in 2017 up by 4.0% compared to 2016 For Bulten’s mix, up 2.1%

• LV stands for ~87% of sales • HCV stands ~13% of sales

ACEA reports for LV sales in Europe for the five first months, 2017

European LV sales for the five first months, 2017 up 5.3% compared to 2016


Source: LMC Automotive Q2, 2017. ACEA five months, 2017

LMC AUTOMOTIVE REPORTS FOR AUTOMOTIVE PRODUCTION IN EUROPE

LMC Automotive (Q2 2017 report) has not changed its forecast level on LV production 2017 compared to the Q1 2017 report. LMCA forecast an increase of 1.8% compared to 2016.

LMC Automotive (Q2 2017 report) has increased its forecast of HCV production 2017 compared to the Q1 2017 report with 1.1%, to an increase of 4.0% compared to 2016.


PRODUCTION GROWTH RATE (YEAR ON YEAR) LIGHT VEHICLES EUROPE

2,9%

2,0%

4,1%

2,7%

1,8% 1,9%

0%

1%

1%

2%

2%

3%

3%

4%

4%

5%

2014E 2015E 2016E 2017E 2018E 2019E

Q1 2017 Q2 2017

PRODUCTION GROWTH RATE (YEAR ON YEAR) HEAVY COMMERCIAL VEHICLES (>15t) EUROPE

-12,5%

4,6%

7,3%5,1% 4,3%4,0%

‐15%

‐10%

‐5%

0%

5%

10%

2014E 2015E 2016E 2017E 2018E 2019E

Q1 2017 Q2 2017

Source: LMC Automotive Q2 2017

3. SECOND QUARTER 2017

OPERATIONAL HIGHLIGHTS FOR THE QUARTER

Sales increased by 3.0% Despite fewer production days vs Q2 2016 Model shifts

Strong order intake of 13.9%

Strong EBIT margin 7.9% Good cost control and flexible production

Improved financial key ratios All financial targets reached

FSP contract of approximately EUR 30 m annually at full volume in 2020

Ram‐Bul contract USD 5.5 m annually at full volume in 2019/2020

Ford honors Bulten JV (BBB Services Ltd) with a special award Recognition World Excellence Award


TWO NEW IMPORTANT CONTRACTS SIGNED AFTER THE QUARTER

FSP CONTRACT

FSP contract signed with a major vehicle manufacturer

The annual order value amounts to approximately EUR 30 million

Deliveries starts end of 2018 and gradually increase to full capacity in 2020

Thereafter, deliveries will extend over a number of years

Strengthens the relationship with the customer in the coming years

RAM‐BUL CONTRACT

Through Bulten’s JV Ram‐Bul in the US, contract signed with a major vehicle manufacturer

The annual order value amounts to approximately USD 5.5 million. The delivery value is distributed USD 5.0 million to Bulten and USD 0.5 million to Ramco

Deliveries will continue over a number of years, with start and ramp up during 2018. Full volumes are expected to be reached in 2019/2020

Significant breakthrough on the north American market and further strengthens our position as manufacturer of high quality fasteners


THE NEXT GENERATION OF ELECTRIC CARS CONSIST OF SUBSTANTIALLY MORE FASTENERS THAN TRADITIONAL CARS

Bulten has started deliveries of fasteners to the pre‐series of the next generation of electric vehicles

These deliveries entail a considerably higher delivery value per car compared to an equivalent model with a combustion engine

Up to approximately 40%

The number of fasteners increase, mainly in the body, depending on material selection and design

Still very low volumes for the industry


GROUP SUMMARYSECOND QUARTER

Net sales SEK 708 m (686)

EBIT margin 7.9% (7.8)

Earnings after tax SEK 39 m (39)

EPS 2.01 SEK (1.92), increased by 4.7%

COMMENTS

Sales up with 3.0% and strong order intake, up 13.9%

Return on capital employed increased to 15.0%, (adjusted for goodwill 17.4%).

All financial target reached

14

FINANCIAL SUMMARY (MSEK)

Q1 12M ROLLING FULL YEAR

2017 2016 ∆Apr 2016‐

Mar 20172016 ∆

Net sales 708 686 3.0% 2,760 2,676 3.2%

Gross profit 141 138 3 551 531 20

Earnings before depreciation (EBITDA) 76 71 5 287 271 16

Operating earnings (EBIT) 57 54 3 211 200 11

Operating margin, % 7.9 7.8 0.1 7.6 7.5 0.1

Earnings after tax 39 39 ‐ 157 146 11

Order bookings 765 672 13.9% 2,831 2,717 4.2%

Return on capital employed, % ‐‐ ‐‐ ‐‐ 15.0 13.9 1.1

Return on capital employed excluding goodwill, % ‐‐ ‐‐ ‐‐ 17.4 16.2 1.2


CONTINUED INCREASE IN SALES AND ORDER INTAKE

Sales up 3.0% in Q2 vs last year and ‐1.3% currency adjusted The number of production days have been lower in the quarter compared to the same quarter

prior year Low volumes due to model shifts

Order intake up 13.9% in Q2 vs last year15

SEK m

708

765

0

100

200

300

400

500

600

700

800

900

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17

Net Sales Order bookings


16

IMPROVED EBIT TREND CONTINUED IN Q2SEK m

EBIT amounted to SEK 57m (54), EBIT margin of 7.9% (7.8) Positive effect of 4 MSEK from reclaimed receivables Negative effect of 4 MSEK from higher raw material prices after consideration of raw material compensation

57

7.9%

0,0%

1,0%

2,0%

3,0%

4,0%

5,0%

6,0%

7,0%

8,0%

9,0%

0

10

20

30

40

50

60

70

Q1 14Q2 14Q3 14Q4 14Q1 15Q2 15Q3 15Q4 15Q1 16Q2 16Q3 16Q4 16Q1 17Q2 17

EBIT

EBIT margin


CASH FLOW, BALANCE SHEET AND NET CASH

17

CASH FLOW STATEMENT, MSEK Q2 JAN‐.JUNE FULL YEAR

2017 2016 2017 2016 2016

Cash flow from operating activities before changes in working capital 70 66 149 134 247

Cash flow from operating activities 37 95 35 173 351

Cash flow from investing activities 2 ‐6 28 ‐22 ‐82

Cash flow for the period ‐43 ‐46 ‐29 7 67

Cash and cash equivalents at end of period 81 49 81 49 109

BALANCE SHEET, MSEK 2017‐06‐30 2016‐06‐30 2016‐12‐31

ASSETS

Total assets 1,969 1,889 1,969

EQUITY AND LIABILITIES

Equity 1,367 1,267 1,357

Liability 602 622 612

Total equity and liabilities 1,969 1,889 1,969

MSEK 2017‐06‐30 2016‐06‐30 2016‐12‐31

Net cash (+)/net debt (‐) 354. ‐89 30.

Adjusted net cash (+)/net debt (‐) 4054. ‐53 68.


THE GROUP 2017‐06‐30 2016‐06‐30 2016‐12‐31

CAPITAL STRUCTURE

Net cash/equity ratio, times 0.0 ‐0.1 0.0

Equity/assets ratio, % 69.4 67.1 68.9

KEY INDICATORS – CAPITAL STRUCTURE AND RETURN INDICATORS

18

12 M ROLLING Full Year

THE GROUP, 12 MONTHS July 2016‐June 2017

July 2015‐June 2016 2016

RETURN INDICATORS

Return on capital employed, % 15.0 13.4 13.9

Return on capital employed excluding goodwill, % 17.4 15.7 16.2

Return on equity % 12.4 10.5 11.5

Return on equity, adjusted % 12.4 10.3 11.5

CAPITAL STRUCTURE

Capital turnover, times 1.9 1.9 1.8

Net cash (+) Net debt (‐) / EBITDA 0.0 ‐0.3 0.1


FINANCIAL GUIDELINES

NWC lower than guidelines

Capex in line with our guidelines

investments in new plating lines in Germany and Poland in 2017

Tax rate in line with our guidelines


THE GROUP12 M ROLLING

Q2FULL YEAR

2016 GUIDELINES

Average net working capital as % of sales 19.4 18.8 20

CAPEX as % of sales 3.5 3.1 2‐3

Depreciation as % of sales 2.8 2.7 2‐3

Tax rate 24.6 24.9 24‐28

20

ALL FINANCIAL TARGETS REACHED IN Q2

Q2

R12

Profitable organic growth more strongly than the industry average

Operating margin of at least 7%

At least 15% At least one third of net earnings after tax

3.0%

3.2%

7.9%

7.6%

Na15.0%17.4%

excl. goodwill

ROCEMargin

✔

Growth

✔

Dividend

2.01 SEK

7.93 SEK

EPS

4.50 SEK

(3.50 + 1.00SEK /share)62% for 2016

EPSdevelopment


✔ ✔

BULTEN DEVELOPMENT

0

500

1000

1500

2000

2500

3000

3500

2013 2014 2015 2016 2017 12 m rolling

21

6.0%

5.5%6.1%

7.5%

7.6%

50 SEK

67 SEK

82 SEK

89 SEK

120 SEK

GROUP STRUCTURE GROWTH AND DIVESTMENT

CONSOLIDATION GROWTHCONSOLIDATION

SalesShare development

Operating margin

Bulten part of FinnvedenBultenGroup.

Divestment of FinnvedenMetal Structures. Several new FSP contracts.

Executing new FSP contracts.

Focus on operation/optimization program

Investments for the future and executing new contracts

+34% growth

+12% growth

Flatdev.

CAPTURE FUTURE GROWTH

+3% growth


4. GOING FORWARD

23

PREDICTED STRONGER BULTEN GROWTH VS THE MARKET

Existing contracts & market growth

New signed not yet started contracts

Future contracts

& increased delivery value in EV’s

Bulten growth late 2017

and onward

Market growth according to LMC Automotive 1.9% 2017. Market share gains through existing contracts New contracts under ramp up for Bulten:

- LV FSP contract. SEK 130 million/year at full pace 2020. Started 2015 with slow ramp‐up - HCV contract. SEK 17 million/year. Started late 2016- China LV contract. SEK 60 million in total. Started 2017, contract period 2017‐2018

New signed contracts to be ramped up:- LV FSP contract. EUR 20 million/year. Starts late 2017 full pace 2019- Russia LV contract. EUR 700 thousand/year. Starts 2017 full pace 2018 - US LV contract (Ram‐Bul) of USD 5.5 million at full volume 2019/2020. Bulten part USD 5.0 million.- LV FSP contract of approx. EUR 30 million at full volume 2020

Future contracts; ongoing customer discussions and increased value/car in EV’s

Ramp up of new

contracts

Market volatility and model

shifts


Bulten has taken significant steps forward in the market and has

created a high credibility in the automotive

industry

GOING FORWARD

Continued long‐term organic growth potential Capture future growth, based on already won contracts

and ongoing discussions• New major FSP contract at an annual value of 30 MEUR• New contract in USA at an annual value of 5.5 MUSD

Opportunities in emerging markets Continuing interesting possibilities in the US market

through new establishment

Preparing for future growth through investments and continued streamlining

Development of fasteners technology for EV is ongoing,

Becoming the most cost‐effective FSP supplier in the industry

Strong financial position All financial targets reached Q2, 2017


BULTEN – A STRONGER SOLUTION

SIX MONTHS REPORT, JAN JUN 2017mb.cision.com/Main/405/2306244/699395.pdf · MARKET DEVELOPMENT LMC...

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