FUCHS GROUP
Investor Presentation
| August 2020
| Thomas Altmann, Head of Investor Relations
Agenda
01 | The Leading Independent Lubricants Company
02 | FUCHS2025
03 | H1 2020
04 | Shares
05 | Appendix
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navigate
- 2
01 The Leading Independent Lubricants Company
FUCHS at a glance
Established 3 generations ago as a family-owned business
Around 5,800 | Preference share is listed | |
employees | in the MDAX | |
No. 1
among the independent suppliers of lubricants
€2.6 bn
sales in 2019
62 companies worldwide
The Fuchs family holds
55% of
ordinary shares
A full range of over
10,000
lubricants and related specialties
- 4
Top 20 lubricant manufacturers1
Number 1 independent
lubricant company
Manufacturers
Independent | Major oil |
lubricant | companies |
manufacturers2 | >100 |
>600 |
- High degree of fragmentation
- Concentration especially amongst smaller companies
Market Shares
>700 | Top 10 |
manufacturers | manufacturers |
<50% | >50% |
1 Market Shares 2019
l 5 | 2 > 1000 tons |
Our unique business model is the basis for our competitive advantage
Technology and innovation leadership in strategically important product areas
FUCHS is fully focussed on lubricantsFUCHS is a full-line supplier
Independency allows reliability, customer & | Global presence, R&D strength, | |
market proximity (responsiveness and | ||
know-how transfer, speed | ||
flexibility) and continuity | ||
Advantage over | ||
Advantage over | ||
major oil companies | independent companies | |
- 6
We are where our customers are
62 Operating Companies
33 Production Sites
70%*
13%
17%
Regional
workforce structure
l 7 | *Incl. Holding |
As of Dec. 2019
Full-line supplier advantage
Sales 2019: €2.6 bn | |||||
(~80% international) | |||||
by customer location | |||||
Automotive lubricants | Industrial lubricants | ||||
~45% | ~55% | ||||
e.g. Engine & gear oils, hydraulic oils, shock absorber fluids, etc. | e.g. Industrial oils, MWF/CP* and greases | ||||
100,000 customers in more than 150 countries
Car industry | Manufacturing | Engineering | Construction | Mining | Trade, Services & |
Transportation |
Heavy Duty | Steel & Cement | Aerospace | Agriculture industry | Wind energy | Food |
- 8
*metalworking fluids/corrosion preventives
Well balanced customer structure
Top 20 Customers account for ~ 25% sales
Engineering / Machinery construction
Agriculture and construction
7%
6%18%
Sales 2019: | ||
Trade, transport and services | 28% | €2.6 bn |
31%
10%
Industrial goods manufacturing
Vehicle manufacturing
Energy and mining
- 9
Organic growth potential in emerging countries
Market Demand
36.4 mn t | +1 % | 36.8 mn t |
FUCHS Sales (by customer location)
€ 902 mn | +185 % | € 2,572 mn |
27%
34%
19%
27%
53%
(1,371)
39%
54%
59% (531)
24% (219)
17% (152)
17%
(436)
30%
(765)
2000 | 2019 |
2000 | 2019 |
l 10 | Asia-Pacific | Americas | EMEA | |||
Investment in the future
R&D expenses and Capex
R&D expenses 2019: €55 mn
€ mn | ||||||
60 | 180 | |||||
52 | 55 | |||||
160 | ||||||
50 | 44 | 47 | 140 | |||
40 | 39 | 120 | ||||
100 | ||||||
30 | 80 | |||||
20 | 60 | |||||
40 | ||||||
10 | 20 | |||||
0 | 0 | |||||
2015 | 2016 | 2017 | 2018 | 2019 | ||
Capex 2019: €154 mn
154 | |||||||
121 | |||||||
105 | |||||||
93 | 73 | ||||||
53 | 58 | 11 | PPA | ||||
50 | |||||||
47 | 11 | ||||||
39 | 11 | ||||||
10 | |||||||
5 | |||||||
2015 | 2016 | 2017 | 2018 | 2019 | ||
Capex | Scheduled amortisation/depreciation | |||||
- 11
Investment program
Capex 2016-2021 ~ €670 mn
- In 2016 - 2018 over €300 mn capex was spent with focus on the expansion of Mannheim, Kaiserslautern and Chicago as well as new plants in China, Australia and Sweden
- Capex peaked in 2019 at €154 mn. In 2020 €120 mn and 2021 €80 mn will be spent on growth and replacement as well as efficiency improvements due to significant volume increases, technological changes and a changed product mix
- From 2022 onwards, capex should be back on par with the new level of depreciation
- mn
200
150
100
50
Estimated level of depreciation
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Capex | Scheduled depreciation* | |
* Depreciation figures excluding PPA from M&A
- 12
Strong track record of integrating businesses
M&A transactions with more than € 10mn sales (p.a.)
(GLOBAL) | (DE) | (SE) | (AU) | (US) | ||||||||
€ 21 mn | € 135 mn | € 140 mn | € 25 mn | € 46 mn* | ||||||||
2010 | 2015 | 2019 | ||||||||||
2014 | 2016 |
(ZA) | (GB) | (US) | Lubricants | |||
(US) | ||||||
€ 15 mn | € 15 mn | € 15 mn | ||||
€ 11 mn | ||||||
* Closing January 24, 2020
- 13
Acquisitions 2019
▪ | Automotive retail business | ▪ | Chemical Process | ▪ | Automotive, medical, aerospace | ||||||
▪ | Sales 2018 AUD 40mn | Management (CPM) | and in-vacuum industry | ||||||||
(~ €25 mn), 65 employees | ▪ Sales 2018 €4 mn, | ▪ Sales 2018 USD 51mn | |||||||||
▪ | Closing April 1, 2019 | 60 employees | (~ €46 mn), 180 employees | ||||||||
▪ | Closing November 1, 2019 | ▪ | Closing January 24, 2020 | ||||||||
- 14
Growth market Africa
- Africa represents 6% of the global lubricant market
- FUCHS intends to increase its presence in this rapidly growing market
- FUCHS South Africa generates € 75 million in sales p.a. with 280 employees
- Joint ventures were founded in Tanzania and Egypt in 2019
- At the beginning of 2020, FUCHS acquired 50% of the shares in three distributors each in Zimbabwe, Zambia and Mozambique. The three joint ventures employ 90 people and generate sales of around € 21 million p.a.
- In other African countries, FUCHS has license partners and distributors
- 15
FUCHS CO2-neutral as of 2020
- Since 2010 already 30% reduction of energy consumption-specific CO2 emissions per ton of FUCHS lubricant produced
- From 2020 onwards, all FUCHS locations worldwide will be CO2-neutral - from energy consumption in production to consumables in administration
▪
▪
Emissions not yet avoided are offset by compensation measures
Investment in high-quality climate protection projects for the expansion of renewable energies
On track to deliver as promised
l 16
02 FUCHS2025
New Mindset for Future Challenges
The FUCHS2025 Strategy
FUCHS2025
New Mindset for Future Challenges
Global
Global customer
requirements
Digitization
New solutions require new ways of operating. And new ways of operation require a new approach and a fresh mindset.
E-Mobility
l
New business | |
l 18 | models |
FUCHS2025
Key Elements
Culture
We want to use these challenges as an opportunity. That is why we are responding to them with a new mindset - an attitude that brings strategy, structure and culture into line in a purposeful way.
StrategyStructure
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FUCHS2025 - growing from a solid foundation
Based on …
•
•
•
Our full product offering and global setup
Our local entrepreneurship in 60+ subsidiaries
Our performance driven culture and loyal employee base
We want to …
- Be thepartner of our customers around their needs in lubrication solutions
- Achieve a better global alignment through harmonized standards and procedures
- Leverage our experience and explore exisiting opportunities, especially in Asia and the Americas
- Continously improve the CO2 footprint of our products based on a lifecycle assessment
- Become the employer of choice
- 20
FUCHS2025 Strategy
Strategic Pillars
Global | Customer & | Technology | |
Six strategic pillars form the base of | Strength | Market Focus | Leader |
our strategy. They are the guiding principles for our strategic actions to reach our vision for FUCHS20205.
Operational | People & | Sustainability |
Excellence | Organization |
l 21
FUCHS2025 Strategy
Actions
Extensive market segment approach: holistic segmentation of all operations regarding customers and markets and effective alignment of organization towards it
In addition initiation of several strategic initiatives with globally staffed cross-functional teams to introduce the strategic objectives from a group perspective
Stronger emphasis on innovation, service solutions and new market perspectives to expand full-line supplier claim
Joint approach with continuous development of corporate culture program to be able to leverage our strong cultural foundation for further strategy execution
FUCHS2025 Strategy
Highlights
Sustainable revenue growth with operational excellence at a 15% EBIT margin and corresponding FVA growth
Technology leadership
in the segments we target until 2025
Be the employer of choice for our existing and future workforce
Better market penetration through market segmentation
Overproportionate growth in Asia-Pacific & the Americas
CO2-neutrality in production
"gate-to-gate" since 2020 and CO2-neutral products "cradle-to-gate" by 2025
- 23
03 Financial Results H1 2020
Highlights H1 2020
€1,120 mn
Sales down by 14 %
€112 mn
EBIT down by 29 %
New Outlook FY 2020
- EBIT decline in the range of 25%
(Based on today's assessment of the effects of the COVID-19 pandemic)
- A second pandemic wave is not taken into account in the forecast
- The effects of the crisis on supply chains, production and customer demand cannot be reliably estimated currently
- Sales revenues and earnings heavily impacted by COVID-19 pandemic
- Asia-Pacificrecords comparatively small decline in EBIT
- Continued very sound balance sheet structure and sufficient liquidity
- FUCHS2025 initiative further intensified and investment program continued
l 25
Sales development
€ mn | 1,296 | - 14% YoY | 1,120 | ||||||
700 | 668 | ||||||||
643 | 642 | 643 | 653 | 656 | |||||
620 | 616 | ||||||||
614 | |||||||||
600 | |||||||||
504 | |||||||||
500 | |||||||||
400 | |||||||||
300 | |||||||||
Q1 '18 | Q2 '18 | Q3 '18 | Q4 '18 | Q1 '19 | Q2 '19 | Q3 '19 | Q4 '19 | Q1 '20 | Q2 '20 |
l 26 |
H1 2020 Group sales
€ mn | ||||
1,500 | ||||
- 186 | 26 | - 16 | ||
(- 14%) | (1%) | (-1%) |
1,300
1,296
1,100 | 1,120 |
- 176
(- 14%)
900
700
H1 2019 | Organic Growth | External Growth | FX | H1 2020 |
- 27
Regional sales growth H1 2020
H1 2020 | H1 2019 | Growth | Organic | External | FX | |
(€ mn) | (€ mn) | |||||
Europe, Middle East, Africa | 690 | 799 | -14% | -13% | - | -1% |
Asia-Pacific | 320 | 355 | -10% | -10% | +2% | -2% |
Americas | 181 | 212 | -15% | -24% | +10% | -1% |
Consolidation | -71 | -70 | - | - | - | - |
Total | 1,120 | 1,296 | -14% | -14% | +1% | -1% |
- 28
Income statement H1 2020
€ mn | H1 2020 | H1 2019 | € mn | in % |
Sales | 1,120 | 1,296 | -176 | -14 |
Gross Profit | 390 | 441 | -51 | -12 |
Gross Profit margin | 34.8 % | 34.0 % | - | +0.8 %-points |
Other function costs | -282 | -289 | 7 | -2 |
EBIT before at Equity | 108 | 152 | -44 | -29 |
At Equity | 4 | 5 | -1 | -20 |
EBIT | 112 | 157 | -45 | -29 |
Earnings after tax | 79 | 112 | -33 | -29 |
- 29
EBIT development
(Q3 2018: €12 mn one-off effect from sale of at equity share)
€ mn | |||||||||
120 | 157 | - 29% YoY | 112 | ||||||
101 | 104 | ||||||||
92 | (92) | 86 | 89 | ||||||
90 | |||||||||
77 | 80 | ||||||||
75 | 72 | ||||||||
60 | |||||||||
40 | |||||||||
30 | |||||||||
0 | |||||||||
Q1 '18 | Q2 '18 | Q3 '18 | Q4 '18 | Q1 '19 | Q2 '19 | Q3 '19 | Q4 '19 | Q1 '20 | Q2 '20 |
l 30 |
EBIT by regions
H1 2020 (H1 2019)
€ mn 150
100
50
0
EBIT margin before at equity
14 | 1 | 112 |
(29) | (4) | (157) |
41
(44)
56
(80)
EMEA | Asia-Pacific | Americas | Holding/cons. | Group |
7.5% (9.4%) | 12.8% (12.4%) | 7.7% (13.7%) | 9.6% (11.7%) |
- 31
Cash flow H1 2020
€ mn | H1 2020 | H1 2019 | in € mn | in % |
Earnings after tax | 79 | 112 | -33 | -29 |
Amortization/Depreciation | 40 | 36 | 4 | 11 |
Changes in net operating working capital (NOWC) | -39 | -20 | -19 | 95 |
Other changes | -7 | -36 | 29 | -81 |
Capex | -58 | -76 | 18 | -24 |
Free cash flow before acquisitions1 | 15 | 16 | -1 | -6 |
Acquisitions | -95 | -10 | -85 | >100 |
Free cash flow | -80 | 6 | -86 | >-100 |
1 Free cash flow before cash paid for acquisitions and before cash acquired through acquisitions |
- 32
H1 2020 earnings summary
- Organic sales decrease in all three regions; Americas and EMEA impacted the most by the spreading of the COVID-19 pandemic; June in APAC on pre-crisis level mainly due to China
- External growth in APAC (NULON) and Americas (ZIMMARK & NYE)
- Slight decrease of Gross Margin in Q2 due to product mix changes; Gross margin at 34.8% (34.0) above HY 2019
-
Cost savings take effect; Other function costs down by €7 million despite increased cost base driven by Capex and
M&A (Australia and North America) - Depreciation and amortization higher due to the investment program
- EBIT at €112 mn (157) and Earnings after tax at €79 mn (112) down by 29% as a result of the COVID-19 pandemic
- New Outlook for FY 2020 after suspending the FY outlook in April; EBIT decrease in the range of 25% for FY 2020
- 33
Outlook 2020 - New Outlook for FY 2020
Performance indicator | Actual 2019 | Outlook 2020 | ||||||||
(Pre-COVID-19) | ||||||||||
Sales | € 2,572 mn | +0% to +4% | ||||||||
EBIT | € 321 mn | +0% to +4% | ||||||||
FUCHS Value Added | € 174 mn | ~ € 170 mn | ||||||||
Free cash flow before acquisitions | € 175 mn | ~ € 130 mn | ||||||||
Capex | € 154 mn | € 120 mn | ||||||||
As of March 4, 2020 | ||||||||||
Outlook | Outlook | |
H1 - 2020 | FY - 2020 |
~ -30%~ -25%
As of April 30, 2020 | As of July 27, 2020 |
- In April 2020 Outlook for the FY 2020 was suspended due to COVID-19
- Earnings decline in the order of 25% (Based on today's assessment of the effects of the COVID-19 pandemic)
- Effects of the crisis on supply chains, production and customer demand cannot currently be reliably estimated
- Statement is subject to great uncertainty and a second pandemic wave is not considered in the current forecast for FY
- 34
04 Shares
Breakdown ordinary & preference shares
(December 31, 2019)
Ordinary shares | Preference shares | |||||||||
Mawer | Norges | MDAX-listed | ||||||||
5% | 3% | |||||||||
DWS | ||||||||||
8% | ||||||||||
Free | ||||||||||
float | ||||||||||
100% | ||||||||||
Free | Fuchs | |||||||||
float | ||||||||||
family | ||||||||||
29% | ||||||||||
55% | ||||||||||
Basis: 69,500,000 ordinary shares | Basis: 69,500,000 preference shares | |||||||||
Characteristics: | Share data: | Characteristics: | Share data: | |||||||
▪ | Dividend | ▪ | Symbol: FPE | ▪ Dividend pluspreference profit share (0.01€) | ▪ | Symbol: FPE3 | ||||
▪ | Voting rights | ▪ | ISIN: DE0005790406 | ▪ Restricted voting rights in case of: | ▪ | ISIN: DE0005790430 | ||||
▪ | WKN: 579040 | ▪ preference profit share has not been fully paid | ▪ | WKN: 579043 | ||||||
▪ exclusion of pre-emption rights (e.g. capital | ||||||||||
increase, share buyback, etc.) | ||||||||||
- 36
Stable dividend policy
Our target: Increase the absolute dividend amount each year or at least maintain previous year's level
Dividend per Preference Share
€ | |||
Payout Ratio 2019: 59% | 0.97 | 18 years | |
of consecutive | |||
1.00 | |||
dividend increases
0.80
13 % | ||
0.60 | CAGR over the | |
last 10 years | ||
0.40 | ||
0.29 | 27 years | |
0.20 | without dividend | |
decreases | ||
0.00 | ||
Market Capitalization
-
mn
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
- 37
FUCHS - Key Investment Highlights
1
2
3
4
5
6
7
8
18 years of consecutive dividend increases
Strong FCF generation & CAPEX with returns above WACC
We supply 100,000 customers in more than 150 countries with a full range of >10,000 lubricants and related specialties
Improving operating profitability
Technology and innovation leadership in strategically important product areas
Independency allows reliability, customer & market proximity and continuity
Well balanced customer & product portfolio as well as global footprint
M&A: Strong track record of integrating businesses
FUCHS-Long-Term Performance
vs. DAX & MDAX1
10000%
8000%
6000%
4000%
2000%
0%
Fuchs Petrolub Pref. | Fuchs Petrolub Ord. | DAX | MDAX | |||
1 Share price development including reinvested dividends
- 38
05 Appendix
Top 20 lubricant countries
KT | ||||
8,000 | 2007 | 2019 | ||
7,000 |
6,000
5,000
4,000
3,000
2,000
1,000
0
- China and the USA cover more than one third of the world lubricants market
- FUCHS is present in every important lubricants consuming country
- 40
Regional per-capita lubricants demand
kg
25 | 2007 | 2019 | ||
20 |
15
10
5
0
- 41
Base oil / additives value split
- Base oil prices do not necessarily follow crude oil prices
- No direct link between additives and crude oil prices
- We even face price increases for certain raw materials where supply/demand is not balanced, or special situations occur
- Special lubricants consist of less base fluid and more additives
- 42
20%
60%
80%
40%
Standard Lubricants | FUCHS | |||
Base Oils | Additives, etc. | |||
Workforce Structure
5,627 employees globally
Regional Workforce Structure
Germany
1,670
(30%)EMEA w/o
Germany 2,280 (40%)
2019
Asia-Pacific
932
(17%)
Americas 745 (13%)
Functional Workforce Structure
Marketing & | Production |
Sales | 1,772 |
2,428 | (32%) |
(44%) | |
2019* |
R&D | |
Admin | 521 |
775 | (10%) |
(14%) |
*Excl. 131 Trainees
- 43
FUCHS - Act together
Mission statement
Lubricants | Technology | People |
Fully focused on lubricants | Technological leadership in | Basis for our success: |
strategically important fields | loyal and motivated workforce | |
Values
Trust | Creating value | Respect | |||||
Trust is the basis of our self- | We deliver leading technology | We acknowledge our | |||||
understanding | and first class service | responsibility | |||||
Reliability | Integrity | ||||||
Act in a responsive and | We believe in a high level of | ||||||
transparent way | ethics and adhere to our CoC |
- 44
FUCHS2025 Strategy
Global Strength
Global
Strength
Strategic Objectives:
- Use market segmentation as basis for strategic and global business development, achieve better market penetration
- Grow above Group average in Asia-Pacific and the Americas, achieve a better balance between all three world regions by 2025
- Further refine the brand profile, strengthen brand equity and attractiveness
l 45
FUCHS2025 Strategy
Costumer & Market Focus
Customer &
Market Focus
Strategic Objectives:
- Achieve maximum customer proximity, further utilize cross-selling opportunities, become the full-line supplier for our customers
- Develop global service portfolio up to 2025, change from product-driven approach to solution-driven approach
- Grow market shares to be amongst the leaders in the segments we target
- Systematically introduce new business models within the broader world of lubrication
l 46
FUCHS2025 Strategy
Technology Leader
Technology
Leader
Strategic Objectives:
- Increase our innovation power in R&D and beyond. Be technology leader in the segments we target until 2025
- Innovate products and operational performance to make our customers more connected with us beyond lubricants by introducing digital solutions and platforms
- Bring all three R&D centers in China, USA and Germany to the same level of expertise until 2025
l 47
FUCHS2025 Strategy
Operational Excellence
Operational
Excellence
Strategic Objectives:
- Strengthen our global manufacturing and distribution network to achieve self-sufficient supply and technology hubs in Asia-Pacific, EMEA and the Americas until 2025
- Further standardize manufacturing and procurement procedures, equipment and output to achieve a more efficient supply chain
- Expand data transparency based on further globalization of structures and harmonization of systems
l 48
FUCHS2025 Strategy
People & Organization
People &
Organization
Strategic Objectives:
- Be the employer of choice for our existing and future workforce
- Further improve working environments and global collaboration
- Strengthen global talent acquisition and retention, enhance our development programs, competence models and succession planning
- Endorse internationalization of entities, remote leadership, international job rotation
l 49
FUCHS2025 Strategy
Sustainability
Sustainability
Strategic Objectives:
- Economical Sustainability
- Generate sustainable revenue growth at 15% EBIT margin with a corresponding increase of our FUCHS Value Added
- Ecological Sustainability
-
CO2-neutral production ("gate-to-gate") since 2020 and carbon-neutral products ("cradle-to-gate") by
2025. Foster additional ecological sustainability projects
-
CO2-neutral production ("gate-to-gate") since 2020 and carbon-neutral products ("cradle-to-gate") by
- Social Sustainability
- Further promote Corporate Social Responsibility projects
l 50
Digitalisation will fundamentally change our value creation
- inoviga GmbH is a think tank outside the operative business
▪
▪
Driving force behind digitalization projects
Develops prototypes and tools for digital business models
- Current topics:
- eCommerce
- Digitalized product development & production
- Smart Services
- 51
Electrification of cars creates new applications
Global light-duty vehicles sales forecast (in mn units)
144 | |||||
131 | 14 | ||||
117 | 10 | ||||
107 | |||||
93 | 96 | 17 | 29 | 40 | |
32 | 34 | 40 | 44 | ||
49 | |||||
53 | |||||
59 | 59 | 58 | 51 | ||
44 | |||||
36 | |||||
RoW
- EU, USA, China
Electric Vehicle
Vehicle w/ combustion Engine
RoW
- EU, USA, China
Electrification is an opportunity for FUCHS to further strengthen its market leadership with technically advanced solutions
▪ Electrification of cars will lead to new applications and higher requirements for |
existing applications |
▪ Regardless of the powertrain type, every car needs a variety of other lubricant |
applications |
▪ Combustion engines will face further efficiency improvements leading to higher |
requirements of existing lubricants (e.g. higher protection against deposits for |
turbocharged engines, higher heat and ageing stability for more compact engines) |
▪ Hybrid cars with efficient combustion engines will place complex requirements for |
existing applications but also create new demand for new applications |
▪ EVs will place whole new demand on gear oils, coolants, greases (e.g. contact |
with electrical currents and electromagnetic fields, higher heat emission, reduction |
gears with less gear steps and higher input speeds) |
2018 | 2020 | 2025 | 2030 | 2035 | 2040 |
Source: FEV / Base Scenario
▪ FUCHS is used to quickly adapting to new market demands and is working on |
concrete methods to meet the challenges of the future mobility |
- 52
Lubricant applications in passenger cars
In modern cars there are more than 30 different types of greases
Central hydraulic system | Skin parts / washing oils | ||
Corrosion prevention for wire cables |
Processing seat components
Axle drive
Power steering
Air conditioning
Engine handling
Engine
Transmission
Radiator antifreeze
Engine components
Shock absorber oils
Forming add-ons and skin panels
- 53
Lubricant applications in passenger cars
Electrification brings a variety of opportunities for FUCHS
Coolants for power
Corrosion preventive for battery housing
Powertrain | ICE | HEV | BEV |
Applications |
electronics
Greases for bearings in E- Motor
MTF in machining of E-Motor a. gearbox
Drawing oils for copperwire
E-Drive Oil for E- Motor and gearbox
Axle transmission oil
Contact grease for electric connections
Compressor oil for heatpump / air condition
Coolant for battery
Cleaners in battery production
Forming oils for battery cell cups or battery module cases
Engine oil | ✓ | ✓ | - |
Transmission oil | ✓ | ✓ | ✓ / - |
Greases | ✓ | ✓ | ✓ |
Specialty greases | ✓ | + | + |
Lubricants for | ✓ | + | + |
Auxiliary systems | |||
Cooling & | ✓ | + | + |
functional liquids | |||
Products, which are needed independent from propulsion type are not shown
- Omitted ✓ Required + Increased |
l 54
Long-term objective:
Focus on Shareholder Value
Drive returns
Optimize capital
Strengthen portfolio
- Organic growth through strict customer focus, geographic expansion and product innovation
- Improve operating profitability through margin and mix management, operating cost management and efficiency improvements
- Capex with returns above WACC
- Manage NOWC
- Reinvest in the business
- Acquisitions
- 55
Cash allocation priority
Reinvest in the business | Shareholder value-oriented |
Capex | Stable Dividends |
Acquisitions | Share Buyback |
- 56
Unique track record for continued profitability and added value
Sales (in € mn)
3,000 | 2,572 | |||||||||
2,500 | ||||||||||
2,000 | 1,459 | |||||||||
1,500 | ||||||||||
1,000 | ||||||||||
500 | ||||||||||
0 | ||||||||||
2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 |
EBIT (in € mn)
17.1% | |||||||||
500 | 18.0% | ||||||||
12.5% | |||||||||
375 | 321 | ||||||||
12.0% | |||||||||
250 | |||||||||
250 | |||||||||
125 | 6.0% | ||||||||
0 | 0.0% | ||||||||
2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 |
EBIT | EBIT margin |
Earnings After Tax (in € mn)
300
228
200 172
100
0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
FVA (in € mn)
300
200 | 183 | 174 | ||||||||||||||||||||||||
-1% | ||||||||||||||||||||||||||
100 | ||||||||||||||||||||||||||
CAGR | ||||||||||||||||||||||||||
0 | ||||||||||||||||||||||||||
2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | |||||||||||||||||
- 57
Development EBIT - Cost of Capital - FVA
€ mn
450 | ||||||||||||||||
400 | EBIT | 371 | 373 | 383 | ||||||||||||
350 | Cost of capital | 342 | 321 | |||||||||||||
FVA | 313 | |||||||||||||||
312 | ||||||||||||||||
300 | 293 | |||||||||||||||
264 | ||||||||||||||||
250 | 246 | 257 | 250 | 251 | ||||||||||||
250 | 230 | |||||||||||||||
222 | ||||||||||||||||
208 | ||||||||||||||||
195 | ||||||||||||||||
200 | 180 | 183 | 186 | 174 | ||||||||||||
161 | 172 | |||||||||||||||
150 | 129 | 137 | 110 | 117 | ||||||||||||
100 | 147 | |||||||||||||||
132 | ||||||||||||||||
86 | 123 | |||||||||||||||
100 | 114 | |||||||||||||||
71 | ||||||||||||||||
96 | ||||||||||||||||
78 | 85 | 90 | 83 | |||||||||||||
37 | ||||||||||||||||
50 | 67 | |||||||||||||||
58 | 61 | 58 | 62 | 63 | ||||||||||||
49 | ||||||||||||||||
0 | ||||||||||||||||
2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 |
Cost of Capital = CE x WACC
- 58
Stable Sales in 2019
€ mn | 2015 | 2016 | 2017 | 2018 | 2019 | 18/19 |
Sales | 2,079 | 2,267 | 2,473 | 2,567 | 2,572 | 0.2% |
Gross Profit | 791 | 851 | 882 | 899 | 890 | -1.0% |
Gross Profit margin | 38.1% | 37.5% | 35.7% | 35.0% | 34.6% | -0.4%-points |
Other function costs | -467 | -499 | -526 | -542 | -580 | 7.0% |
EBIT before at Equity | 324 | 352 | 356 | 357 | 310 | -13.2% |
EBIT margin before at Equity | 15.6% | 15.5% | 14.4% | 13.9% | 12.1% | -1.8%-points |
At Equity | 18 | 19 | 17 | 26 | 11 | -57.7% |
EBIT | 342 | 371 | 373 | 383 | 321 | -16.2% |
EBIT margin | 16.5% | 16.4% | 15.1% | 14.9% | 12.5% | -2.4%-points |
EBITDA | 381 | 418 | 432 | 441 | 400 | -9.3% |
EBITDA margin | 18.3% | 18.4% | 17.5% | 17.2% | 15.6% | -1.6%-points |
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Solid balance sheet and strong cash flow generation
€ mn | 2019 | 2018 | 2017 | 2016 | 2015 |
Total assets | 2,023 | 1,891 | 1,751 | 1,676 | 1,490 |
Goodwill | 175 | 174 | 173 | 185 | 166 |
Equity | 1,561 | 1,456 | 1,307 | 1,205 | 1,070 |
Equity ratio | 77% | 77% | 75% | 72% | 72% |
€ mn | 2019 | 2018 | 2017 | 2016 | 2015 |
Net liquidity | 193 | 191 | 160 | 146 | 101 |
Operating cash flow | 329 | 267 | 242 | 300 | 281 |
Capex | 154 | 121 | 105 | 93 | 50 |
Free cash flow before acquisitions1 | 175 | 147 | 142 | 205 | 232 |
Free cash flow | 162 | 159 | 140 | 164 | 62 |
1 Including divestments
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Regional sales decline 2019
Sales in EMEA, Asia-Pacific and Americas decline slightly
2019 | 2018 | Growth | Organic | External | FX | |
(€ mn) | (€ mn) | |||||
EMEA | 1,579 | 1,618 | -2% | -2% | - | -0% |
Asia-Pacific | 718 | 706 | +2% | -1% | +2% | +1% |
Americas | 418 | 409 | +2% | -1% | +0% | +3% |
Consolidation | -143 | -166 | - | - | - | - |
Total | 2,572 | 2,567 | +0% | -1% | +1% | +0% |
- 61
EBIT by regions
2019 (2018)
€ mn 400
350
300
250
200
150
100
50
0
EBIT margin before at equity
49 | 12 | 321 |
(11) | (383) | |
(59) | ||
93
(102)
167
(211)
Europe | Asia-Pacific, Africa | Americas | Holding/cons. | Group |
9.9% (11.4%) | 13.0% (14.4%) | 11.7% (14.4%) | 12.1% (13.9%) |
- 62
Cash flow 2019
€ mn | 2019 | 2018 | in € mn | in % |
Earnings after tax | 228 | 288 | -60 | -21 |
Amortization/Depreciation and impairment | 79 | 58 | 21 | 36 |
Changes in net operating working capital (NOWC) | 45 | -48 | 93 | - |
Other changes | -23 | -30 | 7 | -23 |
Capex | -154 | -121 | -33 | 27 |
Free cash flow before acquisitions1 | 175 | 147 | 28 | 19 |
Acquisitions1 | -13 | 12 | -25 | - |
Free cash flow | 162 | 159 | 3 | 2 |
1 Including divestments.
- 63
Net Liquidity
€ mn
450
400
350
300
250
200
150
100
50
0
-75 | ||||||||||||||||||
228 | 45 | -23 | ||||||||||||||||
-131 | ||||||||||||||||||
-13 | ||||||||||||||||||
-7 | ||||||||||||||||||
-22 | Free cash flow before acquisitions | |||||||||||||||||
191 | €175 mn | 193 | ||||||||||||||||
Net liquidity | Leasing Earnings after | D&A, Imp ./. | NOWC | Other | Dividend | Acquisitions | Other | Net liquidity |
Dec 2018 | tax | Capex | changes | changes | Dec 2019 |
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Net operating working capital (NOWC)
750 | 28.5% | ||||||||||||||||||||||||||||||||||||||
28.0% | |||||||||||||||||||||||||||||||||||||||
700 | |||||||||||||||||||||||||||||||||||||||
25.5% | |||||||||||||||||||||||||||||||||||||||
650 | |||||||||||||||||||||||||||||||||||||||
23.4% | |||||||||||||||||||||||||||||||||||||||
600 | |||||||||||||||||||||||||||||||||||||||
21.0% | 21.3% | 21.8% | 22.3% | 21.8% | 23.0% | ||||||||||||||||||||||||||||||||||
550 | 20.5% | ||||||||||||||||||||||||||||||||||||||
500 | |||||||||||||||||||||||||||||||||||||||
450 | 18.0% | ||||||||||||||||||||||||||||||||||||||
400 | 15.5% | ||||||||||||||||||||||||||||||||||||||
77 | 78 | 79 | 81 | 85 | 80 | 104 | |||||||||||||||||||||||||||||||||
350 | |||||||||||||||||||||||||||||||||||||||
300 | 13.0% | ||||||||||||||||||||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | 2019 | H1 2020 | |||||||||||||||||||||||||||||||||
NOWC (in € mn) | NOWC (in %)* | NOWC (in days)* | |||||||||||||||||||||||||||||||||||||
* In relation to the annualized sales revenues of the last quarter
- 65
Quarterly income statement
€ mn | 2017 | 2018 | 2019 | 2020 | ||||||||||||||||
Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | |||||||
Sales | 618 | 629 | 615 | 611 | 643 | 668 | 642 | 614 | 643 | 653 | 656 | 620 | 616 | 504 | ||||||
Gross Profit | 226 | 226 | 215 | 215 | 225 | 239 | 222 | 213 | 217 | 224 | 231 | 218 | 218 | 172 | ||||||
Gross Profit margin (in %) | 36.6 | 35.8 | 35.0 | 35.2 | 35.0 | 35.8 | 34.6 | 34.7 | 33.7 | 34.3 | 35.2 | 35.2 | 35.4 | 34.1 | ||||||
Other function costs | -137 | -134 | -129 | -126 | -136 | -140 | -134 | -132 | -142 | -147 | -144 | -147 | -148 | -134 | ||||||
EBIT before at Equity | 89 | 92 | 86 | 89 | 89 | 99 | 88 | 81 | 75 | 77 | 87 | 71 | 70 | 38 | ||||||
EBIT margin before at Equity (in %) | 14.5 | 14.5 | 14.1 | 14.6 | 13.8 | 14.8 | 13.7 | 13.2 | 11.7 | 11.8 | 13.3 | 11.5 | 11.4 | 7.5 | ||||||
At Equity | 5 | 4 | 5 | 3 | 3 | 2 | 16 | 5 | 2 | 3 | 2 | 4 | 2 | 2 | ||||||
EBIT | 94 | 96 | 91 | 92 | 92 | 101 | 104 | 86 | 77 | 80 | 89 | 75 | 72 | 40 | ||||||
EBIT margin (in %) | 15.3 | 15.1 | 14.8 | 15.1 | 14.3 | 15.1 | 16.2 | 14.0 | 12.0 | 12.3 | 13.6 | 12.1 | 11.7 | 7.9 | ||||||
EBITDA | 107 | 109 | 105 | 111 | 106 | 115 | 118 | 102 | 95 | 98 | 107 | 100 | 92 | 60 | ||||||
EBITDA margin (in %) | 17.4 | 17.3 | 17.0 | 18.2 | 16.5 | 17.2 | 18.4 | 16.6 | 14.8 | 15.0 | 16.3 | 16.1 | 14.9 | 11.9 | ||||||
- 66
Quarterly figures by region
2019 | EMEA | Asia-Pacific | North and South America | FUCHS Group | |||||||||||||||||||||||||
Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | Q3 | Q4 | FY | ||||||||||
Sales by company location | 400 | 399 | 402 | 378 | 1,579 | 171 | 184 | 180 | 183 | 718 | 106 | 106 | 108 | 98 | 418 | 643 | 653 | 656 | 620 | 2,572 | |||||||||
EBIT before at equity income | 36 | 39 | 48 | 33 | 156 | 21 | 23 | 23 | 26 | 93 | 14 | 15 | 12 | 8 | 49 | 75 | 77 | 87 | 71 | 310 | |||||||||
in % of sales | 9.0 | 9.8 | 11.9 | 8.7 | 9.9 | 12.3 | 12.5 | 12.8 | 14.2 | 13.0 | 13.2 | 14.2 | 11.1 | 8.2 | 11.7 | 11.7 | 11.8 | 13.3 | 11.5 | 12.1 | |||||||||
Income from at equity companies | 2 | 3 | 2 | 4 | 11 | - | - | - | - | - | - | - | - | - | - | 2 | 3 | 2 | 4 | 11 | |||||||||
Segment earnings (EBIT) | 38 | 42 | 50 | 37 | 167 | 21 | 23 | 23 | 26 | 93 | 14 | 15 | 12 | 8 | 49 | 77 | 80 | 89 | 75 | 321 | |||||||||
in % of sales | 9.5 | 10.5 | 12.4 | 9.8 | 10.6 | 12.3 | 12.5 | 12.8 | 14.2 | 13.0 | 13.2 | 14.2 | 11.1 | 8.2 | 11.7 | 12.0 | 12.3 | 13.6 | 12.1 | 12.5 | |||||||||
2020 | EMEA | Asia-Pacific | North and South America | FUCHS Group | |||||||||||||||||||||||||
Q1 | Q2 | Q1 | Q2 | Q1 | Q2 | Q1 | Q2 | ||||||||||||||||||||||
Sales by company location | |||||||||||||||||||||||||||||
401 | 289 | 146 | 174 | 110 | 71 | 616 | 504 | ||||||||||||||||||||||
EBIT before at equity income | |||||||||||||||||||||||||||||
41 | 11 | 17 | 24 | 12 | 2 | 70 | 38 | ||||||||||||||||||||||
in % of sales | |||||||||||||||||||||||||||||
10.2 | 3.8 | 11.6 | 13.8 | 10.9 | 2.8 | 11.4 | 7.5 | ||||||||||||||||||||||
Income from at equity companies | |||||||||||||||||||||||||||||
2 | 2 | - | - | - | - | 2 | 2 | ||||||||||||||||||||||
Segment earnings (EBIT) | |||||||||||||||||||||||||||||
43 | 13 | 17 | 24 | 12 | 2 | 72 | 40 | ||||||||||||||||||||||
in % of sales | 10.7 | 4.5 | 11.6 | 13.8 | 10.9 | 2.8 | 11.7 | 7.9 | |||||||||||||||||||||
- 67
Quarterly sales & EBIT by regions
Sales (€ mn) | 20181 | 2019 | 2020 | ||||||||||||||||||
Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | ||||||||||
EMEA | 415 | 414 | 408 | 381 | 1,618 | 400 | 399 | 402 | 378 | 1,579 | 401 | 289 | |||||||||
Y-o-Y in % | - | - | - | - | - | -4 | -4 | -1 | -1 | -2 | 0 | -28 | |||||||||
Asia-Pacific | 178 | 191 | 173 | 164 | 706 | 171 | 184 | 180 | 183 | 718 | 146 | 174 | |||||||||
Y-o-Y in % | - | - | - | - | - | -4 | -4 | 4 | 12 | 2 | -15 | -5 | |||||||||
Americas | 95 | 104 | 105 | 105 | 409 | 106 | 106 | 108 | 98 | 418 | 110 | 71 | |||||||||
Y-o-Y in % | - | - | - | - | - | 12 | 2 | 3 | -7 | 2 | 4 | -33 | |||||||||
Consolidation | -45 | -41 | -44 | -36 | -166 | -34 | -36 | -34 | -39 | -143 | -41 | -30 | |||||||||
FUCHS Group | 643 | 668 | 642 | 614 | 2,567 | 643 | 653 | 656 | 620 | 2,572 | 616 | 504 | |||||||||
Y-o-Y in % | - | - | - | - | - | 0 | -2 | 2 | 1 | 0 | -4 | -23 | |||||||||
EBIT (€ mn) | 20181 | 2019 | 2020 | ||||||||||||||||||
Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | ||||||||||
EMEA | 50 | 51 | 61 | 49 | 211 | 38 | 42 | 50 | 37 | 167 | 43 | 13 | |||||||||
Y-o-Y in % | - | - | - | - | - | -24 | -18 | -18 | -24 | -21 | 13 | -69 | |||||||||
Asia-Pacific | 28 | 28 | 24 | 22 | 102 | 21 | 23 | 23 | 26 | 93 | 17 | 24 | |||||||||
Y-o-Y in % | - | - | - | - | - | -25 | -18 | -4 | 18 | -9 | -19 | 4 | |||||||||
Americas | 13 | 17 | 15 | 14 | 59 | 14 | 15 | 12 | 8 | 49 | 12 | 2 | |||||||||
Y-o-Y in % | - | - | - | - | - | 8 | -12 | -20 | -43 | -17 | -14 | -87 | |||||||||
Consolidation | 1 | 5 | 4 | 1 | 11 | 4 | 0 | 4 | 4 | 12 | 0 | 1 | |||||||||
FUCHS Group | 92 | 101 | 104 | 86 | 383 | 77 | 80 | 89 | 75 | 321 | 72 | 40 | |||||||||
Y-o-Y in % | - | - | - | - | - | -16 | -21 | -14 | -13 | -16 | -6 | -50 | |||||||||
1 Previous year's figures adjusted to account for the changes in the organizational and reporting structure
- 68
Quarterly sales growth split by regions
Organic Growth (in %) | 2019 | 2020 | ||||||||||
Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | ||||||
EMEA | -3 | -3 | -1 | -1 | -2 | 0 | -26 | |||||
Asia-Pacific | -5 | -6 | -1 | 8 | -1 | -16 | -3 | |||||
Americas | 8 | -2 | -1 | -7 | -1 | -6 | -42 | |||||
FUCHS Group | -1 | -3 | 0 | 0 | -1 | -6 | -23 | |||||
External Growth (in %) | 2019 | 2020 | ||||||||||
Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | ||||||
EMEA | - | - | - | - | - | - | - | |||||
Asia-Pacific | - | 3 | 4 | 3 | 2 | 3 | 0 | |||||
Americas | - | - | - | 1 | 0 | 10 | 10 | |||||
FUCHS Group | - | 1 | 1 | 1 | 1 | 2 | 2 | |||||
FX Effects (in %) | 2019 | 2020 | ||||||||||
Q1 | Q2 | Q3 | Q4 | FY | Q1 | Q2 | ||||||
EMEA | -1 | -1 | 0 | 0 | 0 | 0 | -2 | |||||
Asia-Pacific | 1 | -1 | 1 | 1 | 1 | -1 | -2 | |||||
Americas | 4 | 4 | 4 | -1 | 3 | 0 | -1 | |||||
FUCHS Group | 1 | 0 | 1 | 0 | 0 | 0 | -2 | |||||
- 69
The Executive Board
Stefan Fuchs: CEO; Corporate Group Development, HR, | Dr. Lutz Lindemann: CTO; R&D, Technology, Product | Dr. Timo Reister: Asia-Pacific, Americas, Industrial Division |
PR & Marketing, Strategy, Inoviga GmbH | Management, Supply Chain, Sustainability, Mining Division, | |
OEM Division |
Dr. Ralph Rheinboldt: Europe, Middle East & Africa, FUCHS | Dagmar Steinert: CFO; Finance, Controlling, Investor |
LUBRITECH Division | Relations, Compliance, Internal Audit, IT (incl. SAP/ERP- |
l 70 | Systems), Legal, Tax |
Executive Compensation & FUCHS Shares
Executive Board
27,5%
of variable compensation
must be invested in FUCHS preference shares with a 4 year lock-up period
Supervisory Board
50%
of variable compensation
must be invested in FUCHS preference shares with a lock-up period of 4 years
- 71
Download: Key documents for our shareholders
Our added value
Transparency
Shareholder-oriented
Well informed
H1 2020 | H1 2020 | H1 2020 |
Financial | ||
Factsheet | Call PPT | |
Report | ||
Annual | Dividend | Ad hoc |
Report | ||
history | releases | |
2019 | ||
Click & Download
- 72
Financial Calendar & Contact
Financial Calendar 2020
July 30, 2020 | Half-year Financial Report 2020 |
November 3, 2020 | Quarterly Statement Q3 2020 |
Financial Calendar 2021
March 9, 2021 | Annual Report 2020 |
May 4, 2021 | Annual General Meeting in Mannheim |
The financial calendar is updated regularly. You can find the latest dates on the webpage at www.fuchs.com/financial-calendar
Investor Relations Contact
FUCHS PETROLUB SE
Friesenheimer Str. 17 68169 Mannheim www.fuchs.com/group/investor-relations
Thomas Altmann
Head of Investor Relations thomas.altmann@fuchs.com
Andrea Leuser
Manager Investor Relations andrea.leuser@fuchs.com
Kelvin Jörn
Junior Manager Investor Relations kelvin.joern@fuchs.com
- 73
Disclaimer
The information contained in this presentation is for background purposes only and is subject to amendment, revision and updating. Certain statements and information contained in this presentation may relate to future expectations and other forward-looking statements that are
based on management's current views and assumptions and involve known and unknown risks and uncertainties. In addition to statements which are forward-looking by reason of context, including without limitation, statements referring to risk limitations, operational profitability, financial strength, performance targets, profitable growth opportunities, and risk adequate pricing, other words such as "may, will, should, expects, plans, intends, anticipates, believes, estimates, predicts, or continue", "potential, future, or further", and similar expressions identify forward-looking statements.
By their very nature, forward-looking statements involve a number of risks, uncertainties and assumptions which could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These factors can include, among other factors, changes in the overall economic climate, procurement prices, changes to exchange rates and interest rates, and changes in the lubricants industry. FUCHS PETROLUB SE provides no guarantee that future developments and the results actually achieved in the future will match the assumptions and estimates set out in this presentation and assumes no liability for such. Statements contained in this presentation regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future.
The company does not undertake any obligation to update or revise any statements contained in this presentation, whether as a result of new information, future events or otherwise. In particular, you should not place undue reliance on forward-looking statements, which speak only as of the date of this presentation.
- 74
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Fuchs Petrolub SE published this content on 06 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 06 August 2020 09:33:03 UTC