Sogefi S p A : May 27, 2020 – Star Conference 2020
05/27/2020 | 02:03am EST
STAR CONFERENCE 2020
Milano - May 27, 2020
Mauro FENZI - Chief Executive Officer
Yann ALBRAND - Chief Financial Officer
Stefano CANU - Investor Relations
Agenda
1
2
3
4
Overview
Q1 2020 Results
Covid update
Perspectives
2 I
Overview
3 I
Group profile
Automotive company created in Listed in Milano Stock Exchange STAR Segment
Strong Entrepreneurship DNA and flexibility developed through:
a series of strategic moves
tight cost control
lean organization
Revenues at € 1,5m in 2019
Present in 23 countries with 41 plants, 10 development centers and 6,800 employees
Multi product portfolio focused on Powertrain and Body Components
4
3 Global Businesses
Suspensions
MAIN
o Stabilizer Bars
o Coil Springs
PRODUCTS
€ 1,519M
€ 550M
2019 Sales
36%
o o o o
Filtration
Air & Cooling
Oil Filters
o Manifolds
Engine Air Filters
o Coolant Pumps
Fuel Filters
o Coolant Outlet
Cabin Air Filters
Housings
€ 546M
€ 421M
36%
28%
5
Sogefi Customers
CARS
AFTERMARKET
TRUCKS
2 WHEELERS
3 WHEELERS
MAIN BRANDS
6
Sales by key client
Q1 2019
Q1 2020
5%10%
7
Hybrid Powertrain
Volume Effect
New Product
Air & Cooling
Manifold
Coolant
Coolant Outlet
Pump
+ E Pump
Housing
Battery Pack
Filtration
coolant Manifold
High performance
Oil Filter
Engine Air
Fuel Filter
Coolant Valve
Cabin Air Filter
E-Axle/E-transmission
Battery/E-Motor and
Filters
Coolant Filter
Power electronic Filters
8
BEV Powertrain
Volume Effect
New Product
Air & Cooling
Battery Pack Coolant
Manifold Module
Coolant Module
Filtration
E-Axle/E-
Coolant Filter
Coolant
transmission Filters
Electric
Coolant Outlet
High performance
Battery/E-Motor and
Coolant Pump
Housing
Valve
Cabin Air Filter
Power electronic Filters
9
FCEV Powertrain
New Product
Air & Cooling
Electric Coolant
Coolant Outlet
Pump
Housing
Coolant Valve
Hydrogen
Manifold
Filtration
Fuel Cell Air
Filter
Fuel Cell
Water
High performance
Battery/E-Motor and
Filters
Separator
Cabin Air Filter
Power electronic Filters
10
Businesses awarded and new agreement on EV vehicles
Customer
Swedish
OEM
French OEM
German
OEM
Other OEMs
Technology Geo/SOP
Product
Hybrid
Motor
China
(2019)
Coolant
Pump
BEV
Europe
Battery Pack
Cooling
(2021)
Manifold
BEV
Europe
Coolant
(2019)
Module
FCEV
Hydrogen
Nafta
intake
(2021)
manifold &
exhaust
VolumesDescription
Distribute the coolant to the motor
Distribute coolant in the battery pack (thermal regulation of the battery)
Distribute the coolant to the battery, the electric motor and the power electronics
Hydrogen, Air and Cooling components
BEV Hybrid Lion E Mobility and Sogefi entered into an agreement, combining Lion's technology in Light
EV joint dev Battery, Battery Management Systems and Module design with Sogefi's industrial capability in engineering and manufacturing of high tech automotive cooling components, as well as access to global sales and distribution capabilities.
11
Supplying premium customers & models
FERRARI 488
PORSCHE TAYCAN
AUDI A6
MASERATI QUATTROPORTE
BMW X series 1 to 5
MERCEDES A/ B/ CLA / C
VOLVO XC90
PORSCHE CAYENNE
CORVETTE
ID CROZZ
BMW series 8
TIGUAN E
12
Selective investments to improve competitiveness
Air & Cooling
✓
Filtration
✓
Suspensions
✓
59
68
60
58
Capex 51
In M EUR
2015
2016
2017
2018
2019
ROMANIA
2018: A&C
2019-2022 : Suspensions
✓✓
✓
✓
CHINA
MEXICO
MOROCCO
2017: Suspensions
2016
2017-2018
13
Q1 2020 Results
14 I
Q1 2020 Highlights
Revenues at €350,2m
vs. €389.9m in Q1 2019
EBITDA at € 34.9m
vs. €41.3m in Q1 2019
EBIT at € 3.7m
vs. €11.3m in Q1 2019
Net Income at € -5.6
vs. € 1.6m end Q1 2019
FCF1 at -€ 0.4m
vs. €-1.6m in Q1 2019
Net debt1 at € 256.7
vs. € 256.2m end of 2019
1. FCF and Net debt excluding IFRS 16
Down 10.2% on a reported basis and -8.8% at constant exchange rate (overperforming the market by 1591 bps)
In YTD February at constant exchange rates +1.0%, thanks to the good performance of all geographic areas except for China, in March at -30%
10.0% on sales vs 10.6% in PY.
In YTD February at 11.4% vs 9.6% thanks to Suspensions improvement, March at 6.2%
1.1% on sales in Q1 2020 vs 2.9% on sales in Q1 2019. Q1 2020 affected by € 5.3m of negative exchange rate effect (North and South America).
March € -4.9m due to the higher % incidence on revenues of fixed costs and despite € 3m of first cost efficiency measures
After tax charges for€ 2.5 million vs €3.6 million in Q1 2019
Free Cash Flow - € 0.4 million vs €-1.6m in Q1 2019
Net debt down to € 256.7 vs € 256.2m end of 2019 and € 262.1m end March
2019
15
Revenues by Geographical Area
reported
constant
reference
performance
weight
Q1 2019
Q1 2020
exchange
market
vs market
based on
change
€m
rates
production
(bps)
Q1 2020
Europe
244.3
222.4
-9.0%
-9.0%
-21.3%
1230
63.5%
North America
74.1
72.7
-1.9%
-4.0%
-10.8%
680
20.8%
South America
37.6
29.0
-22.8%
-3.1%
-16.3%
1320
8.3%
Asia
36.1
27.9
-22.7%
-22.8%
-44.7%
2190
8.0%
- of which China
17.2
11.8
-31.2%
-30.9%
-49.5%
1860
3.4%
Intercompany
(2.2)
-1.8
Total
389.9
350.2
-10.2%
-8.8%
-24.4%
1560
100.0%
Overperforming the market by 1560
bps due to overperformance in
Europe (new Morocco plant and
Aftermarket) and USA (new SOPs)
Source: Sogefi and IHS data. Passenger cars and Light commercial vehicles only. Europe is Europe 28 and Asia is China + India
The activity recorded growth in Europe thanks to Morocco and to Aftermarket
Sales sustainably stable in North and South America
Filtration
Negative exchange rate effect of - € 3.2m mainly in South America
Decline in India
EBIT at 1.3% without Morocco start up costs
20
Air & Cooling
Sales (€m)
EBIT (%)
Down 8.2% (-8.7% at constant exchange)
Major decline in China but overperforming the market thanks to new SOPs
Higher EBIT in Europe was more than offset by the lower profitability in the other areas due to volume decline
Negative exchange rate effect for € 3.3 millions (North America)
Air & Cooling
21
Q1 2020 P&L - Sogefi Group - €m / % sales
€m
Q1 2019
%
Q1 2020
%
EBITDA
41.3
10.6%
34.9
10.0%
EBIT
11.3
2.9%
3.7
1.1%
Financial results
6.3
1.6%
6.8
1.9%
Income Tax
3.6
0.9%
2.5
0.7%
Minority Interest
1.2
0.3%
0.0
0.0%
NET INCOME OF
0.3
0.1%
(5.6)
-1.6%
OPERATING ACTIVITIES
Net income from
1.3
0.3%
0.0
0.0%
Fraize plant contribution in 2019
discontinued operations
NET INCOME
1.6
0.4%
(5.6)
-1.6%
22
Q1 2020 FCF Highlights - Cash Flow generation
•Figures excluding IFRS16
€m
Q1 2019
Q1 2020
FUNDS PROVIDED BY OPERATIONS
32.2
23.2
Working Capital
(10.6)
(2.0)
of which € 4.3m for new
Tangible Capex
(8.9)
(11.1)
plants
Intangibles & IFRS15
(17.5)
(14.3)
Others
3.2
3.8
FREE CASH FLOW (NET)
(1.6)
(0.4)
NET DEBT
262.1
256.7
Factoring at € 96.3m end March 2020 vs € 94.2m end 2019 vs € 114.1m end March 2019
23
Financial Position
In November Sogefi completed the issuance of a € 75m non-convertible unsecured bond (coupon 3%, mature in November 2025)
At March 31, 2020, the Group has financing in excess for € 298 million (of which €
125 banks lines not utilized) in relation to which all the conditions are met and therefore available for use on simple request
In Q2 2020 is scheduled the repayment of the Euro PP and a tranche of the US
PP (both issued in 2013) for a total amount of € 37.5 million
24
Covid update
25 I
Covid update - Takeaways
Safety:
Actions taken to protect
workforce
Plants:
Most of plant close within
18 / 30 March
Main actions:
Using all government
incentives + cost
efficiency
Expectation:
Some customers plants are expected to reopen
China travel ban and travel limitations, "quarantine" for employees coming back from zones at risk
Reducing visits from customers/suppliers, wide spreads use of smart working
Implemented all health safety means defined by local authorities
Closing plants/ offices involving unions all countries (only exception Argentina)
Worldwide (excluding China) most of plants closed within 18 and 30 of March
As of today Sogefi, with the exceptions of South America and India, has reopened (partially) NAFTA plants. EMEA plants to restart beginning of June.
China is running at speed
Of the 6.800 employees ~85% are in «technical unemployment.
Local government support is high in western Europe and not-existing in other regions (i.e. South America or India) where the situation was managed trough local union agreements
In addition taking all necessary steps to manage the crisis by assessing liquidity, containing cash-out by reducing costs and investments that are not strictly necessary.
Source: Sogefi and IHS data. Passenger cars and Light commercial vehicles only. Europe is Europe 28 and Asia is China + India
29
2020 OUTLOOK
In an environment with extremely limited visibility, the most recent sector sources are estimating that world car production may fall by between 20% and 25% in 2020 according to different scenarios as to the effects of Covid-19
Indeed at present all the elements that contribute to the formulation of forecasts for the year remain totally uncertain: the evolution of the pandemic, the decisions to be made by the authorities on the subject of resuming and managing production activity, and lastly, the reaction of demand, in a context of the deep recession that could affect various parts of the world. At present the circumstances described above make any forecast that the company could make highly uncertain
The group is focused on doing all it can to manage the crisis: it has put in place actions to reduce costs and limit, as far as possible, current costs and investments that are not strictly necessary, it regularly assesses liquidity positions, keeping the Board of Directors informed, liaising with its financial partners, and is starting operating again, introducing higher safety standards for personnel and cost flexibility in relation to volumes that will be affected by circumstances for a certain period of time
30
CONTACTS
Yann Albrand, Group CFO Stefano Canu, Investor Relations
SOGEFI
Via Ciovassino, 1/a
20121 Milano - Italia
Tel: +39 02 46750214
Fax: +39 02 43511348
Mail: ir@sogefigroup.com
31
Any reference to past performance of the SOGEFI Group shall not be taken as an indication of future performance.
DISCLAIMER
o This document has been prepared by SOGEFI S.p.A. for information purposes only and for use in presentations of the Group's results and strategies.
o For further details on the SOGEFI Group. reference should be made to publicly available information. including the Annual Report. the Semi-Annual and Quarterly Reports.
o Statements contained in this document. particularly the ones regarding any SOGEFI Group possible or assumed future performance are or may be forward looking statements and in this respect they involve some risks and uncertainties.
o
o This document does not constitute an offer or invitation to purchase or subscribe for any shares and no part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever.
Sogefi S.p.A. published this content on 27 May 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 May 2020 06:02:03 UTC
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