rd Quarter Results. October 29, 2014

Transcription

1 rd Quarter Results October 29, 2014

2 Safe Harbor Statement This document, and in particular the section entitled 2014 Outlook, contains forward-looking statements. These statements may include terms such as may, will, expect, could, should, intend, estimate, anticipate, believe, remain, on track, design, target, objective, goal, forecast, projection, outlook, prospects, plan, intend, or similar terms. Forward-looking statements are not guarantees of future performance. Rather, they are based on the Group s current expectations and projections about future events and, by their nature, are subject to inherent risks and uncertainties. They relate to events and depend on circumstances that may or may not occur or exist in the future and, as such, undue reliance should not be placed on them. Actual results may differ materially from those expressed in such statements as a result of a variety of factors, including: the Group s ability to reach certain minimum vehicle sales volumes; developments in global financial markets and general economic and other conditions; changes in demand for automotive products, which is highly cyclical; the Group s ability to enrich the product portfolio and offer innovative products; the high level of competition in the automotive industry; the Group s ability to expand certain of the Group s brands internationally; changes in the Group s credit ratings; the Group s ability to realize anticipated benefits from any acquisitions, joint venture arrangements and other strategic alliances; the Group s ability to integrate its operations; potential shortfalls in the Group s defined benefit pension plans; the Group s ability to provide or arrange for adequate access to financing for the Group s dealers and retail customers; the Group s ability to access funding to execute the Group s business plan and improve the Group s business, financial condition and results of operations; various types of claims, lawsuits and other contingent obligations against the Group; material operating expenditures in relation to compliance with environmental, health and safety regulation; developments in labor and industrial relations and developments in applicable labor laws; increases in costs, disruptions of supply or shortages of raw materials; exchange rate fluctuations, interest rate changes, credit risk and other market risks; political and civil unrest; earthquakes or other natural disasters and other risks and uncertainties. Any forward-looking statements contained in this document speak only as of the date of this document and the Company does not undertake any obligation to update or revise publicly forward-looking statements. Further information concerning the Group and its businesses, including factors that could materially affect the Company s financial results, is included in the Company s reports and filings with the U.S. Securities and Exchange Commission, the AFM and CONSOB. Q Results October 29,

3 Group overview Components Mass-market brands by region Product & event information Luxury brands Industry outlook & guidance Q3 Q Results October July 30, 29,

4 Q3 14 executive summary WORLDWIDE SHIPMENTS WERE 1.1 MILLION UNITS A 10% increase driven by performance in NAFTA KEY FINANCIAL METRICS Net revenues at 23.6B EBIT at 926M (includes net unusual costs of 36M) Net profit of 188M Net industrial debt at 11.4B Total available liquidity at 21.7B MERGER TO FORM FIAT CHRYSLER AUTOMOBILES N.V. COMPLETED August 1, EGM approved merger of Fiat S.p.A. with and into Fiat Investments N.V. Merger effective on October 12 listed on NYSE on October 13 SUCCESSFUL DEBT CAPITAL MARKETS TRANSACTIONS July 10, the Group issued a 850M bond (4.75% coupon) subsequently re-opened and increased by a further 500M in September 4 (maturing July 2022) September 17, the Group issued a CHF250M bond (3.125% coupon) to mature September 2019 ALL NEW JEEP RENEGADE LAUNCHED Expands market coverage of Jeep brand by entering the small SUV segment FULL-YEAR GUIDANCE CONFIRMED FIRST VIEW ON 2015 VOLUMES ~ M units Q Results October 29,

5 Q highlights Q3 YTD Q3 YTD Shipments (000s units) ,002 1,099 3,393 3, Net profit 188 ( M) * Worldwide shipments up 10% NAFTA: 613k (+21%) LATAM: 202k (-14%) APAC: 55k (+22%) EMEA: 218k (+3%) Luxury Brands: 11k (+94%) Net profit in line with Q3 13 and includes: Net financial expenses of 511M, 18M higher than Q3 13 Income taxes of 227M, 47M higher than Q3 13 Net profit of 174M attributable to owners of the parent (vs 15M loss for Q3 13) Net revenues ( M) Q ,553 20,693 * * YTD 69,006 62,681 Net industrial debt ( B) Sept 30 '14 Jun 30 '14 9,7 11,4 World-wide revenues up 14%, (+14% at constant exchange rates - CER) NAFTA: 13,134M (+20%) LATAM: 2,162M (-12%) APAC: 1,578M (+30%) EMEA: 4,080M (+6%) Luxury Brands: 1,248M (+35%) Components: 2,086M (+11%) 1.7B increase primarily reflects the seasonal cash absorption and is in line with prior year Capex increased to 2.1B, from 1.8B Q3 13 in line with full year guidance Q3 YTD EBIT ( M) * 2,157 2,542 Total available liquidity ( B) Sep 30 '14 Jun 30 ' , Increased by 7% (+10% CER) NAFTA: 549M (4.2% margin) LATAM: 51M (2.4% margin) APAC: 169M (10.7% margin) EMEA: - 63M (-1.5% margin) Luxury brands: 179M (14.3% margin) Components: 48M (2.3% margin) Undrawn committed credit lines Cash & Mktable Securities Total available liquidity was in line with June 30, 2014 Operational absorption and bond repayments at maturity ( 2.1B) were offset by new bond issuances ( 1.6B), and bank financing, as well as a favorable 0.9B currency translation effect ( * ) Adjusted for the retrospective application of IFRS 11: Revenues - 40M, EBIT + 6M, Profit Before Taxes + 2M, Net Profit unchanged. Note: Graphs not to scale. Numbers may not add due to rounding Q Results October 29,

6 Q3 14 EBIT walk M Unusuals (1) (13) Unusuals (36) (118) Q3 '13 NAFTA LATAM APAC EMEA Luxury Components Other & Eliminations Q3 '14 B/(W) than Q2 14 (49) (11) 63 (57) 13 (12) 18 (35) Q Results October 29,

7 Q3 14 net industrial debt walk M Change in Net Industrial Debt (1,668) Cash Flow from operating activities, net of Capex (1,635) 2,116 (654) (102) (879) (9,704) June 30, 2014 Industrial EBITDA Financial charges & taxes* Change in funds & other (2,116) (84) Working Capex Investments, Capital capital scope & other increase /repos/ dividends 0 51 FX translation effect (11,372) September 30, 2014 * Net of IAS 19 Q Results October 29,

8 NAFTA Commercial highlights Q3 14 Q3 13 Sales (k units) Market Share 12.2% 11.3% U.S. 12.3% 11.2% Canada 14.9% 14.3% 2014 Texas Auto Writers Association Awards Texas is the largest truck and SUV market in the U.S. Jeep Grand Cherokee SUV of Texas for the 5 th consecutive year Jeep Cherokee Compact SUV of Texas for the 2 nd consecutive year Ram 2500 Heavy Duty Heavy Duty truck of Texas for the 2 nd consecutive year Commercial Performance o Total NAFTA vehicle sales up 18%, outpacing the industry in both the U.S. and Canada U.S industry in Q3 14 up 8% vs prior year Canada industry up 11% vs prior year o U.S. Vehicle sales up 19% to 536k Jeep brand posted best Q3 sales ever; Chrysler brand posted best Q3 sales since 2007 Q3 14 Jeep and Ram sales up 46% and 30% respectively, versus prior year Jeep Cherokee sales were 48k in the quarter Market share up 110 bps vs prior year, driven by 20% increase in retail sales Fleet mix in line with prior year at 18% Dealer inventory at 71 days supply vs 72 days at end of Q2 o Canada Vehicle sales up 16% to 78k Q3 14 Jeep brand sales more than doubled vs prior year Best September YTD sales ever Market share up 60 bps vs prior year Q Results October 29,

9 NAFTA Financial highlights Q3 14 Q3 13 Shipments (k units) Revenues ( M) 13,134 10,965 o Shipments up 21% y-o-y U.S.: 524k (+23%) Canada: 70k (+21%) Mexico & other: 19k (-11%) o Revenues +20% y-o-y (+20% CER) on higher shipments and positive net pricing EBIT Walk M Unusuals (466) (27) (25) Q3 '13 Volume & Mix Net price Industrial Costs SG&A Investments/ FX/Other Unusuals (5) Q3 '14 o Volume improved due to 108k higher shipments partially offset by negative mix o Higher net price due to positive pricing actions partially offset by higher incentives on certain vehicles o Industrial costs reflect higher vehicle content enhancements, increased warranty and recall costs partially offset by purchasing savings B/(W) Q2 14 (9) 210 (262) 5 7 (49) Q Results October 29,

10 LATAM Commercial highlights Q3 14 Q3 13 Sales (k units) 209k 242k Market Share 15.9% 15.8% Brazil 21.4% 21.3% Argentina 14.1% 12.4% Upgraded Novo Uno Refreshed model launched in September 1st model produced in Brazil with the stop & start technology New Mopar touchscreen multimedia central All new interior design and refreshed exterior Commercial Performance o Industry down 14% over last year reflecting weaker trading conditions and record Q3 13 in Brazil resulting from higher government incentives Brazil industry down 12% y-o-y Argentina industry down 30%, due to import restrictions introduced in 2014 and taxes on higher-end models o Sales down 33k units due to general market weakness o Market share at 15.9%, 10 bps higher than Q3 13 Brazilian share up 10 bps and Group maintained market leadership with a 360 bps lead over the nearest competitor o Strada continued strong performance with 57.2% segment share In Argentina, share up 170bp o combined A/B segment share at 16.7% with strong performance for new Palio (up 50% y-o-y) o Stock levels managed in line with previous year at ~1 month of supply Q Results October 29,

11 LATAM Financial highlights Q3 14 Q3 13 Shipments (k units) 202k 235k Revenues ( M) 2,162M 2,446M o Shipments at 202k down 14% o Revenues: down 12% Brazil: declined by 9% vs Q3 13 due to market weakness Argentina: down 27% reflecting overall market deterioration partially offset by market share increase (-12% CER) EBIT Walk M Unusuals (94) 98 Q3 '13 Volume & Mix Net price Industrial costs SG&A Investments/ FX/Other B/(W) Q2 14 (83) (29) (10) Unusuals (11) 51 Q3 '14 19 (5) (5) (4) (16) (11) o Overall shipments down 33k units, (Brazil and Argentina down 17k and 8k respectively) reflecting worse trading conditions partially offset by better mix o Disciplined pricing actions in Brazil and Argentina nearly offset the increased industrial costs and SG&A which were impacted by higher input cost inflation, Pernambuco startup costs and higher advertising related to new product launches Q Results October 29,

12 APAC Commercial highlights Q3 14 Q3 13 Sales incl. JVs (k units) Market Share China 1.1% 0.8% Australia 4.3% 3.6% India 0.5% 0.5% Japan 0.4% 0.3% 2014 Jeep Cherokee at Indonesia auto show Commercial Performance o Strong industry demand in the region (+4%) with continued growth in China (+7%), India (+10%) and South Korea (+5%), partially offset by slight decline in Japan (-5%) and Australia (-1%) o Group sales were 66k vehicles (incl. JVs) up 25% outperforming industry: China +33%, South Korea +28%, Australia +16%, Japan +9% with decline in India -18% Jeep (52% of total Group sales in the region) up 37% year over year due to Grand Cherokee and newly-launched Cherokee Fiat brand volumes +16% driven by Viaggio & Ottimo o Share gains in all major markets (except India) with Australia increasing the most (+70 bps) Note: APAC industry reflects aggregate for key markets where Group competes (China, Australia, Japan, South Korea, and India.) India-reports wholesale volume on industry and market share. Q Results October 29,

13 APAC Financial highlights Q3 14 Q3 13* Shipments (k units) Revenues ( M) 1,578 1,215 * Adjusted for retrospective application of IFRS 11. Revenues increased by 10M. o Shipments up 22% Jeep +26% Fiat +23% Dodge +21% o Revenues up 30% (+30% CER) driven by higher shipments EBIT Walk M Unusuals (19) (3) (31) 34 Unusuals o Positive contribution from both volume & mix o Net price deterioration primarily reflects competitive environment in China and negative FX impact for vehicles exported to Australia o SG&A increased to support volume growth (1) Q3 '13 Volume & Mix Net Price Industrial costs SG&A Investments/ FX / Other Q3 '14 B/(W) Q (11) (1) Adjusted for retrospective application of IFRS11 (EBIT increased by 3M) Q Results October 29,

14 EMEA Commercial highlights Sales (k units) Q3 14 Q3 13 Cars LCV Market Share (EU28+EFTA) Cars 5.5% 5.6% LCV 10.9% 10.6% New Jeep Renegade Prelaunch tour in main European markets from July European media drive in September with very positive reviews Market launch in Italy began end of September and will be followed by other European markets in Q Commercial Performance Passenger Cars o EU28+EFTA industry up 5% to 3.1M units (5th consecutive positive quarter) Recovery in Italy and Germany (+4%), France flat; UK up 6% softening its positive trend while Spain up double digit (+16%) o Q3 14 sales up 1% to 199k units 167k units sales in EU28+EFTA and 32k units in other EU markets Group share down slightly (10 bps) in EU, driven by share loss in Italy (100 bps) on the back of run-out models, share stable in EU ex-italy at 3.2% Continued market leadership for 500 family, in A & L0 segments LCVs o EU28+EFTA industry up 12% to 407K units driven by recovery in all major markets Italy +24%, UK +20%, Spain +24%, Germany +10%, France +1% o Q3 14 sales up 11% to 60k units Group share increase in EU28+EFTA, +30 bps to 10.9%, with share gain in the main markets (+150 bps Italy, +80 bps UK, +160 bps Spain) Q Results October 29,

15 EMEA Financial highlights Q3 14 Q3 13* Shipments (k units) Revenues ( M) 4,080 3,843 * Adjusted for retrospective application of IFRS 11. Revenues decreased by 17M o Overall shipments up 3% Passenger Cars up 1% to 169k, in line with the sales increase LCVs at 49k units, increasing 6k or 13%, driven by Italy performance o Revenues up 6% on the back of volume increase and favorable mix driven by Jeep and LCV EBIT Walk - M Unusuals 6 (116) (1) 66 (20) 19 (11) (1) (63) Q3 '13 Volume & Mix Net price Industrial costs SG&A Investments/ FX / Other B/(W) Q2 14 Q3 '14 (85) (6) 1 38 (5) (57) (1) Adjusted for retrospective application of IFRS11 (EBIT increased by 3M) Unusuals 0 o Volume increase and favorable mix driven by Jeep, 500 family and LCVs growth o Negative pricing driven by continued competitive pressure in the mass market segments o Industrial costs reflecting improved manufacturing and purchasing efficiencies partially offset by start-up costs in Melfi o SG&A increase driven by Jeep advertising to support brand growth and the launch of all-new Renegade Q Results October 29,

16 Luxury brands Ferrari Q3 14 Q3 13 Shipments 1,612 1,499 Revenue ( M) EBIT ( M) Commercial Performance o Street cars shipments up 8% in the quarter with 12-cyl models down 10% and 8-cyl models up 15% Financial Performance o Q3 revenues up 24% y-o-y o EBIT in line with last year Improvement driven by sales mix on the back of LaFerrari model EBIT includes 15M for compensation costs related to the resignation of the former chairman EBIT margin (ex-unusuals) of 15.7% vs 16.5% last year Q3 14 Shipments By Geography U.S. down 14%, #1 market for the brand Volume up 4% in the 5 major European markets Asia Pacific volumes up 81% LaFerrari USA 28% Europe Top-5 28% Japan 6% China, Hong Kong & Taiwan 13% Others 25% Q Results October 29,

17 Luxury brands Maserati Q3 14 Q3 13 Shipments 8,896 3,953 Revenue ( M) EBIT ( M) Financial Performance o Revenues up 47% to 652M o EBIT at 90M vs 43M a year ago Improvement driven by strong volume growth EBIT margin at 13.8% vs 9.7% last year Commercial Performance Q3 14 Shipments By Geography o Higher shipments of 4,943 units due to continued strong performance of the Quattroporte and Ghibli North America: up +106% vs Q3 13; #1 market for the brand Greater China: growing 106%; #2 largest market for the brand Europe: up 177% to 1.5k units North America 40% Europe Top-4 12% Japan 4% China, Honk Kong & Taiwan 27% Ghibli Others 17% Q Results October 29,

18 Components Revenues & EBIT ( M) Revenues & EBIT ( M) Q3 ' Q3 ' Q3 ' Q3 ' Note: graphs not to scale Note: graphs not to scale o Revenues up 15% Performance was positive in North America and Europe, down in Brazil while flat in China o Revenues down 10%, substantially unchanged at constant scope of operations Volumes down 12% (at constant perimeter) for the Cast Iron business while up 17% for the Aluminum business o EBIT performance improved due to mix and pricing o EBIT up 32% or 53% excluding unusual items Growth mainly reflects higher volumes Unusual items related to Brazilian restructuring o Orders up 40% to 840M of which captive 340M (more than double vs Q3 2013: 152M), and non captive 500M (up 12% vs Q3 last year) mainly in Lighting and Powertrain business Q3 '14 Q3 '13 Revenues & EBIT ( M) Note: graphs not to scale o Revenues up 4% mainly attributable to the Body Welding business o EBIT slightly down y-o-y o Order intake totaled 484M, a 19% increase mainly attributable to the Body Welding business 9 11 Q Results October 29,

19 Product & event information Products Events RAM ProMaster City (to be launched in Q4 2014) o Developed from the successful Fiat Doblo o Best-in-class features include combined fuel economy, 178hp and 174lb-ft of torque, 1,883lb payload, cargo volume of ~132 cubic ft o First 9-speed automatic transmission in a commercial van o Two-seat Tradesman cargo van and 5-seat passenger wagon FIAT 500X (to be launched in Q1 2015) o From 14th Oct. available for customers pre-orders in the limited Opening Edition in EMEA (available at dealership in early 2015) o New compact crossover in the 500 family, that combines style and function o Available in two 4x2 options with the 140 HP 1.4 Turbo MultiAir II or the 120 HP 1.6 MultiJet II engines, and one 4x4 with the 140 HP 2.0 MultiJet II engine EGM on 1 August, approved the cross-border merger of Fiat with and into its whollyowned subsidiary incorporated in the Netherlands Fiat Investments N.V. ( Fiat Investments ) then renamed FCA Merger became effective on 12 October, following satisfaction of all conditions precedent cash exit rights were exercised for 60M shares and no creditors oppositions were filed, therefore the 500M cumulative cap was not exceeded FCA made its debut on the NYSE on October 13 Q Results October 29,

20 Industry outlook (M units) NAFTA FY '14E FY '13 ~ ,7 o US: FY estimate increased slightly to ~16.7M vehicles (from 16.5M previously) in line with year-to-date SAAR of 16.7M o Canada: FY industry estimate expected to be flat with prior year level of 1.8M vehicles LATAM FY '14E FY '13 Passenger cars 4.2 4,7 1,0 LCVs 1,1 ~ o Outlook for LATAM adjusted downward to ~5.2M (from 5.6M previously) reflecting economic uncertainties o Brazil industry expected to be down 8% as poor market conditions continued o Argentina industry to decline doubledigit due to import restrictions and increased sales tax on highend segments FY '14E APAC FY '13 26,2 28,0 o Industry projected up 7% Improvement driven by China, India and South Korea partially offset by contraction in Australia Note: APAC reflects aggregate for key markets where Group competes (China, India, Australia, Japan, South Korea) EMEA EU28+EFTA FY '14E FY '13 Passenger cars LCVs o Outlook substantially unchanged for passenger cars and LCVs vs prior expectations Passenger Cars LCVs ,7 ~14.7 EU28+EFTA: +5% EU28+EFTA confirmed at 12,3 1, Slight increase for UK & 1.7M Spain Italy expected to post a 14% Italy, Germany & France increase y-o-y outlook unchanged Note: Graphs not to scale. Numbers may not add due to rounding Q Results October 29,

21 2014 guidance World-wide shipments Revenues EBIT Net profit Net industrial debt ~4.7M 93B B* B (EPS )* B * Excludes unusual items Q Results October 29,

22 APPENDIX Q Results July 30,

23 Supplemental financial measures FCA monitors its operations through the use of various supplemental financial measures that may not be comparable to other similarly titled measures of other companies. Accordingly, investors and analysts should exercise appropriate caution in comparing these supplemental financial measures to similarly titled financial measures reported by other companies. Group management believes these supplemental financial measures provide comparable measures of its financial performance which then facilitate management s ability to identify operational trends, as well as make decisions regarding future spending, resource allocations and other operational decisions. FCA s supplemental financial measures are defined as follows: Earnings Before Interest, Taxes ( EBIT ) is computed starting from Net profit/(loss) and then adding back Tax (income)/expenses and Net financial expenses Earnings Before Interest, Taxes, Depreciation and Amortization ( EBITDA ) is computed starting with EBIT and then adding back depreciation and amortization expense Net Industrial Debt is computed as debt plus other financial liabilities related to Industrial Activities less (i) cash and cash equivalents, (ii) current securities, (iii) current financial receivables from Group or jointly controlled financial services entities and (iv) other financial assets. Therefore, debt, cash and other financial assets/liabilities pertaining to Financial Services entities are excluded from the computation of Net Industrial Debt Q Results October 29,

24 Q3 14 Key performance metrics M (unless otherwise stated) Q3 14 Q3 13 (1) Worldwide total shipments (units 000) 1,099 1,002 Net revenues 23,553 20,693 EBIT Of which: Investment income, net Unusual items, net (36) (1) Financial charges, net (511) (493) Pre-tax result Taxes (227) (180) Net profit Net profit excluding unusual items EBITDA 2,166 2,030 (1) Adjusted for the retrospective application of IFRS 11: Revenues - 40M, EBIT + 6M, Profit before Taxes + 2M, Net profit unchanged. Shipments adjusted to include Luxury Brands. Q Results October 29,

25 Mass-market brands Market share by key market Quarterly Market Share (%) NAFTA LATAM Q3 Q4 Q1 Q Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q Q3 Q3 Q4 Q Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q Q2 Q3 EMEA APAC LCV Passenger Cars LCV Passenger Cars Q3 Q4 Q1 Q Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q Q3 Q3 Q4 Q1 Q Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q Q3 1.Reflects aggregate for key markets where Group is competing (China, Australia, India-reports wholesale Q Results volume on industry, Japan, South Korea) October 29,

26 Group shipments (excl. JVs) outlook (units in thousands) (units in M) Luxury 0.05 APAC LATAM ~4.7 >0.2 ~ ,002 10% Luxury +94% APAC +22% 1, LATAM -14% NAFTA ~ NAFTA +21% EMEA +3% EMEA ~1.0 Q3 13 Q3 14 FY 13 FY 14E Note: Numbers may not add due to rounding; Graphs not to scale Q Results October 29,

27 Debt maturity schedule ( bn) Outstanding Sept FCA 3M Beyond 12.5 Bank Debt Capital Market Other Debt Total Cash Maturities Cash & Mktable Securities 3.1 Undrawn committed credit lines 21.7 Total Available Liquidity 3.7 Sale of Receivables (IFRS de-recognition compliant) 2.2 of which receivables sold to financial services JVs (FGA Capital) Note: Numbers may not add due to rounding; total cash maturities excluding accruals Q Results October 29,

28 Contacts Group Investor Relations Team Joe Veltri Vice President Timothy Krause Paolo Mosole fax: websites: Q Results October 29,