Credit Suisse. MAHLE Metal Leve S.A. VI Brazil Equity Ideas Conference New Year, New Perspectives. Sao Paulo, January 22-23, MAHLE

Transcription

1 Credit Suisse VI Brazil Equity Ideas Conference New Year, New Perspectives MAHLE Metal Leve S.A. Sao Paulo, January 22-23,

2 Important Notice The material that follows is a confidential presentation of general background information about MAHLE Metal Leve S.A. and its subsidiaries (collectively, MAHLE ) as of the date of the presentation. It is information in summary form and does not purport to be complete. No representation or warranty, express or implied, is made concerning, and no reliance should be placed on, the accuracy, fairness, or completeness of this information. This confidential presentation may contain certain forward-looking statements and information relating to MAHLE that reflect the current views and/or expectations of MAHLE and its management with respect to its performance, business and future events. Forward looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words like anticipate, believe, estimate, expect, forecast, plan, predict, project, target or any other words or phrases of similar meaning. Such statements are subject to a number of risks, uncertainties and assumptions. We caution you that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in this presentation, including: market acceptance of MAHLE s products or services; volatility in the autoparts and automotive industry, the Brazilian economy and the financial markets; changes in legislation, accounting standards, taxation and government policies affecting the autoparts and automotive sector; ability to stay abreast of changes in technology; ability to continuously introduce competitive new products and services, while staying competitive in existing ones. In no event, neither MAHLE nor any of its affiliates, directors, officers, agents or employees, nor if applicable the selling shareholder, placement agents or underwriters, shall be liable before any third party (including investors) for any investment or business decision made or action taken in reliance on the information and statements contained in this presentation or for any consequential, special or similar damages. All forward-looking statements in this presentation are based on information and data available as of the date they were made, and MAHLE undertakes no obligation to update them in light of new information or future developments. This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or in part without MAHLE s prior written consent. Securities may not be offered or sold in the United States unless they are registered or exempt from registration under the United States Securities Act of 1933, as amended. Any offering of securities to be made in the United States will be made solely by means of a confidential offering circular that may be obtained from the placement agents or the underwriters. Such confidential offering circular will contain detailed information about MAHLE and its business and financial results, as well as its financial statements. This presentation does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any securities. Neither this presentation nor anything contained herein shall form the basis of any contract or commitment whatsoever. 2

3 Agenda Company s Presentation and Results for the 3Q and YTD September The MAHLE Group Worldwide 2. The MAHLE Metal Leve S.A. Group 3. Market & Current Status and Trends 4. Financials (Results for the 3Q and YTD September 2012) 5. Capital Market 3

4 The MAHLE Group Worldwide 4

5 The MAHLE Group Worldwide The MAHLE Group is a global leader in engine components and filters Group Highlights Revenues (EUR bn) 5,1 5,0 5,3 6,0 2,4 2,8 3,1 3,3 3,8 4,1 4,3 3, German group founded in 1920 and headquartered in Stuttgart Global Footprint One of the 3 major global suppliers of piston systems, cylinder components, valve train systems, as well as management and filtration of air and fluid systems Global leader in partnerships for engine development Over 100 production units on 4 continents 8 technology centers Close to 49,000 employees MAHLE Group Presence MAHLE Group s Technology Centers 5

6 The MAHLE Group Worldwide Locations Canada Niagra-on-the-Lake Tilbury USA Ann Arbor (MI) Atlantic (IA) Caldwell (OH) Churubusco (IN) Farmington Hills/Detroit (MI) Franklin (KY) Holland (MI) Manchester (MO) McConnelsville (OH) Morristown (TN) Murfreesboro (TN) Muskegon (MI) Novi/Detroit (MI) Olive Branch (MS) Russellville (AR) St. Johns (MI) Trumbull (CT) Winterset (IA) Argentina El talar/ Buenos Aires Rafaela Mexico Aguascalientes Naucalpan Puebla Ramos Arizpe Santa Catarina/ Monterrey Brazil Indaiatuba Itajubá Limeira Mogi Guaçu São B. Campo Jundiaí Queimados Great Britain Bathgate Kilmarnock Northampton Rugby Salisbury Telford Wellingborough Worcester Spain Alcalá de Henares/ Madrid Vilanova i la Geltrú Portugal Murtede Switzerland Grenchen Italy La Loggia Potenza Saluzzo Trento Volvera Austria Rankweil St. Michael ob Bleiburg Vöcklabruck Wolfsberg Poland Krotoszyn Germany Albershausen Alzenau Barsinghausen Eislingen/Fils Fellbach Flintbek Gaildorf Hamburg Leibertingen Lorch Markgröningen Öhringen Plettenberg Roßwein Rottweil Schorndorf Stuttgart Wölfersheim Wustermark Zell im Wiesental Turkey Krotoszyn Romania Timisoara Slovakia Dolný Kubín India Gurgaon Parwanoo Pithampur Pune Chennai China Changchun Chongqing Guangzhou Macheng Nanjing Shanghai Tianjin Yingkou Thailand Bangkok Samutprakarn Korea Hwasung Ulsan Philippines Cavite Japan Fukushima Ibaraki Kawagoe Okegawa Tochigi Tokyo Tsuruoka Yamagata Australia Laverton North/ Melbourne 6

7 The MAHLE Group Worldwide Integration of the Behr Group In January, 2011, the MAHLE Group increased its stock ownership to 36.85% in the Behr Group, with a call option in order to takeover (over 50% of the capital stock) of the Behr Group for January, 2013 The Behr Group is specialized in components for thermal management of vehicles and air conditioning systems. With over 17 thousand collaborators, the Behr Group sales in 2011 were of around EUR 3.7 bn The acquisition of the Behr Group will permit to the MAHLE Group extend its portfolio of products and services with thermal management systems for engines in commercial and light vehicles The majority acquisition of Behr by MAHLE, scheduled for early next year, has been delayed. Behr Management informed MAHLE about investigation proceedings that had been initiated by European Commission in Stuttgart, Germany and local Department of Justice in USA against manufacturers of thermal systems for automobiles for suspected competition-restricting practice. MAHLE as a Company is in no way affected by this inspection The aim of acquiring the majority holding in Behr and of integrating Behr fully into the MAHLE Group is ongoing 7

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9 A history of successful acquisitions and high growth Acquisitions 96 Acqusition of the control of Metal Leve S.A. by MAHLE Acquisition of 3 business units from Siemens - VDO 07 Acquisition of Dana s engine components business Acquisition of Edival in Argentina (valve manufacturing plant) 1,9 08 Joint Venture with MAHLE HIRSCHVOGEL FORJAS S.A. in Queimados, RJ 2,1 10 Acqusition of the piston ring business from MAHLE Componentes de Motores by MAHLE Metal Leve 2,0 2,3 1,7 1,7 1,7 1,7 Other Events 50 Foundation of METAL LEVE, the 1 st piston manufacturer in Brazil 98 Incorporation of the piston manufacturing plant in Mogi Guaçu, SP 71 Initial public offering at BM&F Bovespa 0,7 0,9 1,0 01 Opening of the filter manufacturing plant in Mogi Guaçu, SP 1,4 05 Opening of the bushing manufacturing plant in Itajubá, MG 08 Opening of the Technology Center in Jundiaí, SP 11 MAHLE completes its US$195 mm follo w-on offering at BM&FBovespa Net Revenues (R$ bn) 9

10 Locations in Brazil MOGI-GUAÇU Headquarters Pistons, Pins, Cylinder Liners, Camshafts, Connecting Rods and Filters ITAJUBÁ Piston Rings and Bushings LIMEIRA Distribution Center QUEIMADOS Connecting Rods and other products forged JUNDIAÍ Tech Center INDAIATUBA Sinter parts 6 Plants SÃO PAULO City Office (Investor Relations) Distribution Center Tech Center City Office SÃO BERNARDO DO CAMPO Bearings 10

11 Locations in Argentina RAFAELA Valves / Valve guides / Valve Seats BUENOS AIRES Distribution Center 1 1 Plant Distribution Center 11

12 Diversified presence in markets and products (2011) Market Breakdown Product Breakdown Engine Type Breakdown 6.9% 28.8% 22.3% 28.3% 39.0% 40% 32.1% 7.8% 8.1% 12.8% 13.8% 60% Domestic OEM Exports OEM Aftermarket Pistons / Kits Rings Bearings Valve Train Liners / Ring Inserts Other engine components Filters Heavy Duty vehicles (Diesel) Ligth vehicles (Otto) 12

13 Unrivaled Portfolio of Components Plastic cylinder head cover module Valve camshaft Oil filter module Aluminum cylinder head¹ Oil-mist separator with control valve Air filter module Tappet (cam follower, rocker arm)¹ Tumble flap¹ Valve guide Exhaust gas recirculation valve¹ Valve Valve seat insert Aluminum engine block¹ Turbocharger¹ Intake manifold (charged air distribution) Blow-by induction¹ Fuel filter Piston ring Cylinder liner Piston Connecting rod 13 Piston pin, Piston pin circlip Note: 1 Products not manufactured in Brazil Bearing Controlled Oil pump¹

14 Market & Current Status and Trends 14

15 Evolution of the Brazilian automotive industry Brazilian automotive industry 15 Jan - Dec Jan - Dec Vehicle Sales B/A (locally-manufactured and imported) B A Passenger Cars ,7% Light Commercials ,5% Total of Light vehicle ,1% Trucks ,5% Buses ,8% Total of medium and heavy vehicle ,1% Total vehicle sales ,6% Exports ,1% Imports ,3% Automotive trade balance ( ) ( ) 15,9% Vehicle inventory variation in the period (*) ( ) ,5% Total vehicle production ,9% (*) Vehicle inventory variation = production -(sales + exports - imports). Source: Anfavea Production of Light vehicle ,2% Production Trucks ,5% Production Buses ,4% Production Trucks and Buses ,8% Agricultural ,6% Production of medium and heavy vehicle ,5%

16 Evolution of the Brazilian automotive industry 16

17 Evolution of the Argentinian automotive industry Argentinian automotive industry Jan - Dec Jan - Dec Vehicle Sales B/A (locally-manufactured and imported) B A Passenger Cars ,5% Light Commercials ,0% Total of Light vehicle ,8% Trucks ,5% Buses ,1% Total of medium and heavy vehicle ,0% Total vehicle sales ,0% Exports ,6% Imports ,7% Automotive trade balance ( ) ( ) -15,4% Vehicle inventory variation in the period (*) ,6% Total vehicle production ,8% (*) Vehicle inventory variation = production -(sales + exports - imports). Source: Adefa Production of Light vehicle ,6% Production Trucks ,5% Production Buses ,1% Production of medium and heavy vehicle ,3% 17

18 Vehicle sales and production in MERCOSUR Vehicle SALES in MERCOSUR (*) Jan - Dec Jan - Dec Vehicle SALES in MERCOSUR (*) B/A B A Sales of Light vehicle ,7% Sales Trucks ,7% Sales Buses ,9% Sales Trucks and Buses ,2% Sales Agricultural ,2% Sales of medium and heavy vehicle ,0% Total Vehicle Sales ,6% 18 Vehicle production in MERCOSUR (*) Jan - Dec Jan - Dec Vehicle production in MERCOSUR (*) B/A B A Production of Light vehicle ,6% Production Trucks ,0% Production Buses ,7% Production Trucks and Buses ,1% Production Agricultural ,6% Production of medium and heavy vehicle ,2% Total Vehicle Production ,0% (*) Considering Brazil and Argentina. Source: Anfavea and Adefa

19 Customer Investments 19

20 Brazil OEM Vehicle Production Plants Location 20

21 Brazilian vehicles 2013 x 2012 Forecasts disclosured (Tds. units) 21

22 Government measures in Brazil related to Automotive Industry - Main impacts Bigger Brazil Plan for the new industrial policy in Brazil focused on stimulating innovation and domestic production to boost the competitiveness of the Brazilian industry First Phase announced in August 2011 Reintegra program (a special tax recovery regime for exporting companies), which entitled the Company until December 2012 was extended for 1 (one) year until December 31, 2013 to a tax credit of 3% on exports (net of social contributions) Second Phase announced in early April This phase comprises the new Brazilian automotive regime: Mainly tax measures (elimination of employer pension contributions (social charges) of 20% on the payroll changed for payroll taxes with a flat 1% tax on gross domestic revenue, excluding exports The Program was regulated in October, called INOVAR-AUTO and will be described in next slides A series of measures in May 2012 for the automotive industry includes financial measures (mainly increase in the volume of loans and cut in interest rates) and tax measures (reduction in IPI rate postponed to December 31,2012) In June 2012 PAC Equipment Program, that is the expansion of the Growth Acceleration Program (PAC) through government purchases, and in mid-august 2012 the National Logistics Plan in highways and railroads Federal Government announced in the end of August 2012 new stimulus measures basically regarding financing conditions, such as an extension of validity in special financing conditions for the PSI 4 from August 31, 2012 to December 31, The program PSI4 will be maintained in Only there will be slight increase in rates before the 2,5% a year today, to 3% in the first half and 4% in the second. Agriculture in this period prescribed, are at 3.5% Return to full IPI rate will occur gradually. IPI once again, the federal government has postponed implementation of the full IPI rate for vehicles. The return to the full IPI rate will now occur gradually between January and June,

23 Automotive Regime 2013 to 2017 (INOVAR-AUTO) The Program INOVAR-AUTO announced in early October new rules to offset 30% increase on IPI rate Mandatory ¹ Limited to 4.800/year, ² Limited to 50% of new plant capacity during 2 years maximum Qualification * Including Importing companies (light vehicles) limited to veh./year 23

24 Automotive Regime 2013 to 2017 (INOVAR-AUTO) Steps Inovation 0,15% 0,30% 0,50% 0,50% 0,50% Eng. / TBI* 0,50% 0,75% 1,00% 1,00% 1,00% Production Steps Factor PV** local Pass Car 6 of 12 7 of 12 7 of 12 8 of 12 8 of 12 Trucks 8 of 14 9 of 14 9 of of of 14 Chassis 5 of 11 6 of 11 6 of 11 7 of 11 7 of 11 Pass Car 1,3 1,25 1,15 1,1 1 Trucks¹/Chassis 1,30 1,25 1,15 1,10 1,00 Trucks² 1,00 0,95 0,90 0,85 0,85 Labeling 36% 49% 64% 81% 100% Trucks ¹ = Heavy and Semi Heavy Trucks ² = Light and M edium * Technology Basic Industrial **Purchase Value More spends with Inovation and Eng./TBI can be add extra IPI discount: 2,00% in Inovation -1% IPI 0,75% - 2,75% in Eng./TBI -1% IPI Offset of the IPI increase 30% To purchase in Mercosur the same value supplies or tooling as the IPI increase Estimated purchase value increase in Mercosur 30% 24

25 Financials 25

26 Net sales revenue and margins R$ million YTD Sep

27 Financial statements R$ million Income statement YTD Sep. % 2011 % Net sales revenue 1, ,236.8 Cost of goods sold (1,240.6) (1,687.9) Gross income Selling expenses (112.1) 6.6 (147.3) 6.6 General and administrative expenses (72.7) 4.3 (81.9) 3.7 Tech and product development expenses (49.0) 2.9 (72.8) 3.3 Other operating income (expenses) (14.6) 0.9 (4.8) 0.2 Financial income (expenses), net (15.5) Operating income Net income EBITDA EBITDA margin 16.9% 17.9% Assets YTD Sep. % 2011 % Current assets 1, , Cash and banks Trade accounts receivable Inventories Other assets Long-term assets Fixed assets 1, , Investments Property, plant and equipment Intangible assets Total assets 2, , Liabilities YTD Sep. % 2011 % Current liabilities Trade accounts payable Financings Provisions Other liabilities Long-term liabilities Financings Provisions and others Minority interest Shareholder's equity 1, , Total liabilities 2, ,

28 Capex and depreciation / Indebtedness Capex and depreciation R$ million R$ million Indebtedness Capex YTD Sep % Net sales 2.3% 3.7% 5.4% 4.7% % Depreciation 27.4% 50.3% 97.9% 93.3% * Capex expected for 2012 (includes an increase in the amount of R$ 7.9 million, related to the implementation of a new product line for piston rings Large Bore) Financial leverage YTD Sep (*) Net indebtedness/ebitda 1.1 x 1 x 0.9 x 0.7 x % Short term debt 21.0% 26.4% 70.6% 66.2% * Extrapolating the EBITDA of YTD Sep for FY In July the Company released a BNDES funding in the amount of R$162.5 million 28

29 Capital Market 29

30 Dividends and Interest on Equity (net of income tax) Basis of calculation for dividends: R$ million (=) Net income (+) Deemed cost ( ) Statutory reserve (5%) (*) Interest on equity Dividends YTD Dec Payout 46,8% 56,0% 72,6% 95,7% - Dividend yield 3,6% 6,0% 8,9% 10,3% 5,4% * Interest on equity and dividends regarding to four payments. 30

31 Stock performance and Shareholder s profile January, 2013 Shareholder Profile Average Daily Trading Volume (ADTV) and ADTV turnover to Free-Float Mkt Cap Period 3Q11 4Q11 1Q2 2Q12 3Q12 4Q12 1Q13 Trading Volume (R$ mio) 1,8 1,7 4,9 4,9 5,8 5,8 4,4 Turnover (%) 0,44% 0,37% 0,77% 0,64% 0,67% 0,59% 0,44% 31

32 THANK YOU For clarifications or further information, please access the Company s Investor Relations Website: or make contact with Investor Relations department Heiko Pott João Antônio Passos Carvalho Ana Paula Nogueira Phone #: relacoes.investidores@br.mahle.com 32