scania interim report january-september 2013
DESCRIPTION
Scania's earnings for the first nine months of 2013 fell to SEK 5,939 m. Higher vehicle volume and better capacity utilisation had a positive effect. The stronger krona had a negative impact and earnings were also pulled down by a competitive pricing environment. Summary of the first nine months of 2013 • Operating income fell to SEK 5,939 m. (6,135), and earnings per share fell to SEK 5.30 (5.94) • Net sales rose by 8 percent to SEK 61,864 m. (57,261) • Cash flow amounted to SEK 1,362 m. (2,176) in Vehicles and Services Comments by Martin Lundstedt, President and CEO: “Scania's earnings for the first nine months of 2013 fell to SEK 5,939 m. Higher vehicle volume and better capacity utilisation had a positive effect. The stronger krona had a negative impact and earnings were also pulled down by a competitive pricing environment. Order bookings for trucks in Europe continued to improve during the third quarter. Demand has been supported by customers that are investing in Euro 5 vehicles before year-end, when the transition to Euro 6 will occur. There is also a replacement need. Scania has a strong position with its broad engine range and the launch of its second-generation Euro 6 engines. The company’s market share in Europe has increased during the period, among other things thanks to its leading position in Euro 6. In Latin America too, Scania has captured market shares. Order bookings in Latin America remained at a good level but decreased compared to the high level of the previous quarters. Order bookings for buses and coaches fell related to Latin America and Asia. In Engines, order bookings increased in Europe compared to the second quarter, driven by investments ahead of the transition to the new emission standard in 2014. Scania is continuing its long-term efforts to boost market share in Services. Service revenue rose by 9 percent in local currency during the third quarter. Scania has raised its daily production rate in Europe while increasing flexibility at its production units. There are good growth opportunities and the expansion of annual technical production capacity towards 120,000 vehicles is continuing. To strengthen competitiveness, the level of activity related to development projects remains high, at the same time as Scania is expanding its sales and service capacity in emerging markets.” View the full report: http://bit.ly/18aqP5eTRANSCRIPT
Interim Report, January–September 2013 Erik Ljungberg Corporate RelationsErik Ljungberg, Corporate Relations
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Business overviewMartin Lundstedt President and CEOMartin Lundstedt, President and CEO
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First nine months of 2013
Improved truck order Improved truck order bookings in Europe
Truck order bookings in Truck order bookings in Latin America at a high level
Hi h d ti t Higher production rate
Growing service revenue
3
Europe Scania trucks order bookingsScania trucks, order bookings
Higher market share – strong position in Euro 6
No seasonal down-turn in Q3
Pre-buy of Euro 5 in first nine month
Replacement need
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Euro 6 and Scania Streamline
Maintain leadershipin fuel efficiencyin fuel efficiency
Proven Euro 6 recordrecord
Second generation with better fuelwith better fuelefficiency launchedin 2013
Full Euro 6 rangeavailable from 2014
Latin AmericaScania trucks order bookingsScania trucks, order bookings
Order bookings at ga good level in Q3
Subsidies in Brazil and Argentina
Higher market share gin Brazil and Argentina
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EurasiaScania trucks order bookingsScania trucks, order bookings
Good level of demand in Russia in the first nine monthsmonths
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AsiaScania trucks order bookingsScania trucks, order bookings
Improved order pbookings in the Middle East in Q3 from low levelfrom low level
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Buses and coachesScania buses and coaches order bookingsScania buses and coaches, order bookings
Large orders in gRussia, Malaysia and Taiwan in 20132013
Europe at low levellevel
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EnginesScania engines order bookingsScania engines, order bookings
Pre-buy activity y yahead of new emission standard (Stage IV/Tier4-(Stage IV/Tier4-final) in 2014
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Higher production rate
Higher daily production rate in Europe during Q3 and Q4
Increased flexibilityy
Close to capacity limit for supply chainsupply chain
Investment for technical capacity expansion to 120 000capacity expansion to 120,000 vehicles ongoing
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Growing service revenue
Service revenue +9 % in local currency in Q3
Investment in capacity
Ambition to increase market shareshare
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European heavy truck market
350 000
Units
250 000
300 000
150 000
200 000
50 000
100 000
01973 1978 1983 1988 1993 1998 2003 2008 2013*
Truck registrations > 16 tonnes * Refers to rolling 12 month
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Summary
Improved order bookings p gin Europe
Higher market share in Europe Higher market share in Europe and Latin America
High production rate in Q4 High production rate in Q4
High R&D activity and increase in sales and service capacityin sales and service capacity
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Interim Report, January–September 2013 Jan Ytterberg CFOJan Ytterberg, CFO
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First nine months of 2013 – highlights
Impact from stronger SEKp gand weaker BRL
Higher vehicle volume Higher vehicle volume
High level of investments
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Volume trendTotal deliveries trucks and busesTotal deliveries, trucks and buses
SignificantlySignificantly higher volume in Latin America
Higher daily production rate in Q4 in EuropeQ4 in Europe
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Service revenue
Higher volume, g ,somewhat higher prices
Increased revenue in local currencies in several regionsin several regions
Revenue +7% in local currencieslocal currencies during 9 months
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Earnings trendOperating income Scania GroupOperating income, Scania Group
Net sales up 8% inp9 months and up 10% in Q3 2013
EBIT margin 9.6% (10.7) in 9 months and 10 0% (10 5) inand 10.0% (10.5) in Q3
Earnings per share Earnings per shareSEK 5.30 (5.94) in 9 months
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Operating incomeVehicles and ServicesVehicles and Services
EBIT decrease due to:– Currency rate effects
PricesEBIT decrease:
SEK 274 m., 9 months 2013
+ Volume
+ Capacity
utilisation
C
– Prices
9 months 2013– Currency
– Prices Positive effects:– Vehicle volume– Capacity utilisation
in Latin America
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Cash flowVehicles and ServicesVehicles and Services
Cash flow SEK 618 m. in Q3
High level of ginvestments
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Net debtVehicles and ServicesVehicles and Services
Net cash SEK 6,970 m. (Net cash SEK 9 361 m at end9,361 m. at endof 2012)
Dividend payment Dividend paymentSEK 3.8 bn. in Q2
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Volume trendCredit portfolio Financial ServicesCredit portfolio, Financial Services
Portfolio +4% in local currencies since end of 2012
Operating income SEK 511 m. (433) in 9 months 2013in 9 months 2013
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Summary
Significant impact from g pstronger SEK on earnings
Higher vehicle deliveries Higher vehicle deliveries
Higher production rate in Q4
High level of investments
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