full-year results 2019 - stadler rail srail fy 2019 results... · full-year results 2019 dr. thomas...

FULL-YEAR RESULTS 2019

Dr. Thomas Ahlburg, Group CEO, and Raphael Widmer, Group CFO

5 March 2020

BUILDING TRAINS WITH PASSION AND

SWISS PRECISION

Stadler full-year results 2019 | © Stadler | 5 March 2020

AGENDA

Highlights Dr. Thomas Ahlburg, Group CEO1

Financial results Raphael Widmer, Group CFO2

Outlook Dr. Thomas Ahlburg, Group CEO3

2

HIGHLIGHTSDr. Thomas Ahlburg, Group CEO

A SUCCESSFUL YEAR FOR STADLER

Stadler full-year results 2019 | © Stadler | 5 March 2020 4

− First US METRO contract for

Stadler, 127 METRO trains for

MARTA (Atlanta)

− 163 locomotives sold at a recorded

order intake of c. CHF 800m

Order intake

Seven new fleets and 444 vehicles

delivered (~+80% vs 2018)

Giruno high-speed train (SMILE)

enters regular passenger service

for SBB in Switzerland

Fleets delivered

55 FLIRT Akku for Schleswig-

Holstein, Germany

First hydrogen-powered train to run

in the US for SBCTA (California)

New technologies

Regional expansion

Service Signalling

Indonesia joint venture

34 locomotives for Taiwan

Opening of new plant in Salt Lake

City, US

15 year service contract for DART,

US

35 year service contract for 52 new

METRO-trains for Merseytravel in

Liverpool, UK

Generic homologation of GUARDIA

ETCS system

First CBTC contract awarded

Successful test of ATO train in NL

and CH


FULL-YEAR 2019 KEY FIGURES

Order intake

CHF 5.1bn

+17%(1)

EBIT margin

6.1%

-149bps(1)

Net revenues

CHF 3.2bn

+60%(1)

5

(1) Change year-on-year.

(2) Defined as EBITDA –Capex –Change in NWC. EBITDA is calculated as the sum of EBIT and depreciation and amortization

Order backlog

CHF 15.0bn

+14%(1)

Net profit

CHF 128.5m

+8%(1)

Free Cash Flow(2)

CHF -328.9m

+ CHF 37.8m(1)

Vehicles delivered

444

+80%(1)


OPERATIONAL HIGHLIGHTS & CHALLENGES

6

444 or ~ 80% more vehicles delivered in 2019 compared to

2018, seven new fleets entered service in 2019

23% increase year-on year in average FTEs to ~11’000

Operating licence for new high-speed vehicle concept (SMILE)

Opening of new plants in Salt Lake City (US), St. Margrethen

(CH), Herne (Service, DE); capacity expansions in Środa (PL)

and Minsk (BY)

Highlights

Substantial ramp-up of production and workforce has lead to

certain inefficiencies, which mainly materialised in the fourth

quarter

Higher costs in certain projects (primarily Greater Anglia)

Challenges are of temporary nature and under control

Challenges

FINANCIAL RESULTS FULL-YEAR 2019 Raphael Widmer, Group CFO

FULL-YEAR RESULTS 2019 SUMMARYCHFm

Order intake Net revenues Order backlog

EBIT Capital expenditure(2)

2018 2019

5’1174’389

+17%

2018 2019

13’17915’026

+14%

3’201

2018 2019

2’001

+60%

151

1947.5%

2018

6.1%

2019

+28%

EBIT as % of net revenues

-323

27

2018 2019


Change year-on-year

Net working capital(1)

(1) Net working capital is calculated by subtracting the sum of trade payables, liabilities from work in progress and other current liabilities (including other current liabilities, current provisions and deferred income and accrued

expenses) from the sum of trade receivables, inventories, work in progress and other current assets (including other current receivables, compensation claims from work in progress and accrued income and deferred expenses).

(2) Capital expenditure is calculated as the sum of investments in tangible and intangible assets.

188

249

2018 2019

+32%

Strong order intake ahead of expectations in both reporting segments

Relatively stable order intake development in Europe with a higher weight towards the DACH

region

Significant growth in order intake from the Americas region driven by the order for 127 METRO

trains for MARTA in the US valued at over USD 600m

Comments


ORDER INTAKECHFm

621

833

4’284

2018

3’767

2019

Rolling Stock

Service & Components4’389

5’117

+17%

9

42%

34%

18%

DACH

45%

1% 17%

2%

2018

16%

17%Eastern Europe

8%

2019

Western Europe

Americas

Others(1)

(1) Others: CIS and rest of the world.


NET REVENUESCHFm

248

261

1’752

2018

2’001

2019

Service & Components

Rolling Stock2’940

3’201

+60%

10

43%

5%1%

3%

65%

19%

6%6%

2018

46%

5%

2019

DACH

Western Europe

Eastern Europe

Americas

Others(1)


Significant net revenue growth of c. 60% to CHF 3.2bn

Net revenues below expectations due to postponements in projects (primarily Greater Anglia)

and exchange rate movements

Substantial growth recorded in Western Europe mainly relates to deliveries in the United

Kingdom and Scandinavia

Comments


ORDER BACKLOG I/IICHFm

10’917

2’262

Rolling Stock

2018


12’254

2’772

2019

13’179

15’026

+14%

11

32%

7%

8%

41%

41%

2%

2018

40%

13%

11%

4%

2019

DACH

Western Europe

Eastern Europe

Americas

Others(1)


Strong order intake drives record order backlog of CHF 15bn providing high revenue

visibility


ORDER BACKLOG II/II

12(1) Others: CIS and rest of the world.

High quality and increasingly diversified order backlog with a growing share of strategic

rolling stock market segments as well as service

62%

5%

5%

9%

17%

2%Locomotives

Trains

Tailor-made

Metro

LRV


50%

6%

8%

7%

11%

18%

Executing on

strategic focus

Order backlog by market segment: 2019Order backlog by market segment: 2018


REPORTING SEGMENTS

CHFm 2018 2019 Change

Order intake 3’767 4’284 14%

Net revenues (third party) 1’752 2’940 68%

Order backlog 10’917 12’254 12%

Investments in fixed assets 144 186 29%

Total staff as FTEs(1) 6’884 8’408 22%

(1) Average FTEs 1 January to 31 December.

Rolling Stock


Order intake 621 833 34%

Net revenues (third party) 248 261 5%

Order backlog 2’262 2’772 23%

Investments in fixed assets 27 25 -7%

Total staff as FTEs(1) 1’829 2’326 27%


Ready to execute on the record order backlog with increased capacities and resources


EBITCHFm in % of net revenues

14

151

194

7.5%

6.1%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

0

50

100

150

200

2018 2019

+28%

EBIT EBIT in % of net revenues

− Strong EBIT growth of c. 28% to CHF 194m

EBIT margin below expectations due to operational inefficiencies, incremental growth

investments and FX effects

Operational impact related to individual orders (primarily Greater Anglia)

Comments

FX2018 Operational

inefficiencies

Growth

investments

2019

7,5%

6,1%

Note: Sizes of EBIT bridge elements are illustrative only.

Change year-on-year


Earnings before interest and taxes (EBIT) 150.9 193.7 28%

Financial result (21.4) (47.1)

Share of results from associates 2.3 4.0

Ordinary result 131.9 150.6 14%

Non-operating result - (2.1)

Profit before income taxes 131.9 148.5 13%

Income taxes (12.7) (20.0)

Profit for the period 119.2 128.5 8%

thereof attributable to

- Shareholders of Stadler Rail AG 117.8 127.2

- Non-controlling interests 1.4 1.4


NET INCOME

15

− Financial result mainly impacted by higher order-related bank guarantee costs and foreign

exchange losses

− Effective tax rate 2019 in-line with expectations

Comments


NET WORKING CAPITALNet working capital(1) (CHFm)

132

261 232

280

818252

286

-757 -804

-174-250

-269

-386

Comp. claims from WIP

2019

-323

86

Inventories

Trade receivables

2018

Work in progress (net)

Trade payables

Other current assets

Other current liabilities

27

(1) Net working capital is calculated by subtracting the sum of trade payables, liabilities from work in progress and other current liabilities (including other current liabilities, current provisions and deferred income and accrued

expenses) from the sum of trade receivables, inventories, work in progress and other current assets (including other current receivables, compensation claims from work in progress and accrued income and deferred expenses).

-323

27

46

Com

p. cla

ims fro

m W

IP

NW

C 2

01

9

538

Work

in p

rogre

ss (

ne

t)

NW

C 2

01

8

Oth

er

cu

rre

nt a

sse

ts

34

Tra

de

rece

iva

ble

s

(29)

Inve

nto

rie

s

(47) (76)

Tra

de

pa

ya

ble

s

(117)

Oth

er

cu

rre

nt lia

bili

ties

Increase in NWC driven by the change in compensation claims from work in progress


CAPITAL EXPENDITURECHFm

4865

174

213

14

35

188

2019

8

55

2016 2017

11

2018

76

249

Investments in intangible assets Investments in tangible assets

High level of investments to support Stadler’s growth

St. Margrethen (Switzerland), Herne (Germany), Salt Lake City (USA), Środa (Poland) and

Minsk (Belarus)

Investments in intangible assets mainly relate to development of new high-speed SMILE vehicle

concept, new products in locomotives and signalling

Comments

Negative operating cash flow (primarily Greater Anglia)

High level of growth investments

Non-current financial liabilities (mainly CHF 300m bond)

Current financial liabilities (mainly project financing, e.g. SBB SMILE order)

Comments


NET CASHCHFm

695 753

-468

-279

-81

Current financial liabilities

Cash and cash equivalents

-82

2018

Non-current financial liabilities

2019

5326


BALANCE SHEETCHFm

Inventories 232

Assets from WIP 634

Trade receivables 286

Cash 753

Comp. claims from WIP 818

PPE 702

Other current assets 132

Intangible assets 105Other LT assets 139

Assets

Trade payables 250

Current financial liabilities 279

Liabilities from WIP 1’438

Other current liabilities 386

LT financial liabilities 468

Other LT liabilities 131

Equity 847

Liabilities

3’800 3’800

• Strong liquidity position

• Successful issuance of CHF

300m bond at a coupon of

0.375% to support future

growth

• Self-funding nature of

projects with negative net

work in progress

• No goodwill capitalised

Strong balance sheet

Total net work in progress: (804)

Net cash position: 6

SUMMARY AND OUTLOOKDr. Thomas Ahlburg, Group CEO

21

ONGOING GROWTH MOMENTUM IN THE RAIL SECTOR


Growing demand supported by global megatrends

Tender pipeline remaining strong

Resilience to typical industrial business cycles

EXECUTING ON OUR 2023 STRATEGY


Europe

North America

CIS

New markets

• Market segments

unchanged

• Deliver on

backlog and

establish next

sales level

• Growth through

new product

pipeline

Rolling Stock

• Growing

accessible market

and installed base

• New service

solutions

• Capture

opportunities

from signalling

• Potential selective

acquisitions

Service &

Components

• Establish own

signalling

solutions

• AngelStar JV with

Mermec

• Potential

opportunistic

acquisitions

Signalling

Rolling Stock


Stadler sales today

Rolling Stock


Signalling

Stadler strategy 2023

Reg

ion

s

Strategic focus

Note: Sizes of pie charts are illustrative only.

PRIORITIES FOR 2020

• Capitalise on pipeline of

successful new products

• Focus on project

execution:

– Bring new hires up the

learning curve

– Drive efficiency gains

along the value chain

Rolling Stock

• Ensure highest reliability

and availability

• Ramp-up of new service

locations

• Convert strong order

intake momentum into

revenue growth


• Achieve full homologation

of GUARDIA ETCS

system in a number of

European countries

• Execute existing CBTC

order and further leverage

in-house platform

• Execute existing ATO

orders in NL and CH

Signalling


Priorities 2020

Around CHF 3.5bn at constant currencies

Comparable to 2019

At least 6%


FY 2020 FINANCIAL GUIDANCE

Net revenues

EBIT-margin

Our 2020 outlook is, among other factors, subject to possible implications related to

the potential impact of the COVID-19 outbreak. To date we see only limited

indications for negative effects on the stability of our supply chain. However, we are

still at an early stage of assessing the situation.

Payout ratio of c. 60% of net incomeDividend

KEY TAKEAWAYSREFLECTION AND OUTLOOK


444 vehicles delivered (c. +80% vs 2018)

Successful homologation and service entry of seven new fleets

Record levels of order intake, net revenues and order backlog

Certain growth related challenges combined with additional costs

and delays in certain projects (primarily Greater Anglia)

Rail market momentum and tender pipeline remaining very strong

Growth related challenges remain key management focus in 2020

High-quality backlog provides strong visibility

Payout ratio of c. 60% of net income

Mid-term financial targets confirmed

Mid-term

2020

2019

Q&A


APPENDIX


INFORMATION

Share information

Listing: SIX Swiss Exchange

Currency: CHF

Ticker symbol: SRAIL

ISIN: CH0002178181

Listing date: 12 April 2019

Financial calendar

30 April 2020: Annual General Meeting

25 August 2020: Publication of half-year results 2020

Investor contact

Raphael Widmer

Group CFO

Phone: +41 71 626 86 80

E-mail: [email protected]

Daniel Strickler

Investor Relations Officer

Phone: +41 71 626 86 47


28

Media contact

Marina Winder

Head of Communications & PR

Phone: +41 71 626 31 57


COMPREHENSIVE PORTFOLIO OF VEHICLE FAMILIES

Market segments and vehicle families Order backlog contributions 2019

Very High

Speed

High Speed

Intercity

Regional /

Suburban

Not a strategic focus

Loco-

motives

Metro

Main-line

locomotives

Shunting

locomotives

LRV

Metro

Tram /

Tram Train

TypeMarket

segmentVehicle families Reporting segment

Se

rvic

es

& S

ys

tem

s

Ta

ilo

r-m

ad

eRegional markets

Market segmentTrains

Coaches


82%

18%

Rolling Stock


40%

32%

13%

2%

3% 11%

Americas

DACH

Western Europe

CIS

Eastern Europe

Rest of the world

50%

8%

7%

11%

18%

6%

Trains

Locomotives

Tailor-made

Metro

LRV


CHFmRolling

Stock

Service &

Components

Corporate

CenterTotal

Rolling

Stock

Service &

Components

Corporate

CenterTotal

Order intake 3’767 621 - 4’389 4’284 833 - 5’117

Total revenue 1’789 536 (325) 2’001 3’002 642 (442) 3’201

Inter-segment revenue (37) (289) 326 - (62) (381) 443 -

Net revenue 1’752 248 1 2’001 2’940 261 0 3’201

Investments in PPE 144 27 3 174 186 25 2 213

Total FTE 6’884 1’829 161 8’874 8’408 2’326 184 10’918

20192018

SEGMENT BREAKDOWN



WORK IN PROGRESSCHFm

(757)(804)

(88)

▲Liabilities

from WIP

WIP (net) 31

Dec 2018

▲Assets

from WIP

41

WIP (net)

H1 2019

593

(757)

634

(804)

Assets from WIP Liabilities

from WIP

Total WIP (net)

(1’438)(1’350)

2018

2019

Continuously negative net work in progress (WIP)

DISCLAIMERIMPORTANT NOTICE

This presentation (the "Presentation") has been prepared by Stadler Rail AG ("Stadler" and, together with its subsidiaries, "we", "us" or the "Group") and includes forward-looking

information and statements concerning the outlook for our business. These statements are based on current expectations, estimates and projections about the factors that may

affect our future performance, including global economic conditions, and the economic conditions of the regions and markets in which the Group operates. These expectations,

estimates and projections are generally identifiable by statements containing words such as “expects,” “believes,” “estimates,” “targets,” “plans,” “outlook” or similar expressions.

There are numerous risks and uncertainties, many of which are beyond our control, that could cause our actual results to differ materially from the forward-looking information and

statements made in this Presentation, which, in turn, could affect our ability to achieve our stated targets. The important factors that could cause such differences include:

changes in the markets the Group serves, including as a result of changes in the global demand for transportation and demographic changes; the Group's ability to successfully

develop, launch and market new products and services; the Group's ability to retain existing customers and/or secure new customers; the Group's ability to compete with existing

and new competitors; the Group's ability to maintain the high quality, reliability, performance and timely delivery of its products and services; the impact of fluctuations in foreign

exchange rates; and such other factors as may be discussed from time to time. Although we believe that our expectations reflected in any such forward-looking statement are

based upon reasonable assumptions, we can give no assurance that those expectations will be achieved.

PRESENTATION OF FINANCIAL INFORMATION

This Presentation has been prepared by Stadler solely for informational purposes. Certain financial data contained herein is based on historical financial information of Stadler

that has been prepared in accordance with the accounting standards of Swiss GAAP FER, unless otherwise stated. In addition, certain financial data included in the Presentation

consists of "non-Swiss GAAP financial measures". These non-Swiss GAAP financial measures may not be comparable to similarly titled measures presented by other companies,

nor should they be construed as an alternative to other financial measures determined in accordance with Swiss GAAP. You are cautioned not to place undue reliance on any

non-Swiss GAAP financial measures and ratios included herein.

In addition, certain financial information contained herein has not been audited, confirmed or otherwise covered by a report by independent auditors and, as such, actual data

could vary, possible significantly, from the data set forth herein.

THIS PRESENTATION IS NOT AN INVITATION TO PURCHASE SECURITIES OF STADLER OR THE GROUP.

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