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Agenda Review 2006 Strategy Outlook 2007 2
Highlights 2006 Focus on Transport-Related Engineering Strong operational performance in all business areas Strong market environment Initiative taken for truck consolidation 3
Best year ever Order intake Sales 18 16 14 12 10 billion 16.6 14.3 76% 75% +16% Abroad Germany 14 12 10 8 billion 11.4 +15% 13.0 73% 74% 8 6 6 4 2 24% 25% 4 2 26% 27% 28% 26% 0 0 2005 2006 2005 2006 4
Strong team Number of employees 60,000 50,000 51,412 2,251 +4.5% 53,715 3,425 40,000 30,000 20,000 10,000 0 75% 49,161 50,290 2005 2006 Temporary workers Employees 5
Best performance ever Operating profit Return on sales (ROS) 1,200 1,000 800 600 million 674 +431 1,105 9 8 7 6 5 4 in % 5.9 +2.6 8.5 400 3 200 2 1 0 2005 2006 0 2005 2006 6
Performance by business area Business area Operating profit 2005* Operating profit 2006* ROS 2006 ROS target Commercial Vehicles 497 698 8.0% 7.0% Diesel Engines 117 229 12.7% 6.5% Turbo Machinery 43 71 7.8% 6.5% Industrial Services 64 119 8.6% 4.0% * million 7
Key financial data Return on capital employed Free cash flow 30 25 20 15 in % 19.1 +8.9 28.0 1,000 800 600 million 889-267 622 10 400 5 200 0 2005 2006 0 2005 2006* excl. Scania stock acquisition 1,174 million 8
Stock price performance MAN (gross yield) vs. DAX Performance 1997-2006 December 31, 2005 = 1.00 (% p.a.) 1.70 1.60 1.50 1.40 1.30 1.20 1.10 1.00 +55.5% +22.0% D 05 F A J A O D 06 18 16 14 12 MAN 10 DAX 8 6 4 2 0 17.1 8.6 DAX MAN 9
Return for our stockholders Earnings per share Dividend per share 6 5 4 3 2 in 2.75 +2.30 5.05 3 2 2 1 in 1.35 +0.65 2.00* 1 1 0 2005 2006 0 2005 2006 * incl. 0.50 bonus 10
Agenda Review 2006 Strategy Outlook 2007 11
Group strategy Operational excellence Sustainable group structure Profitable growth Effective governance Sustainability 12
Operational excellence New targets 2010 Return on capital employed (ROCE) : >22% Return on sales (ROS) : 2006 8.5% ROS 250 million improvement Ø Business cycle 8.5% ROS 13
Commercial Vehicles Target Ø ROS 8.5% (+/-2%) Measures Strengthening service network Structural improvement at buses Efficiency gains Focus: light/medium trucks 14
Diesel Engines Target Ø ROS 8.5% (+/-4%) Measures Production network Expansion of service business Focus on key components and key competencies 15
Turbo Machinery Target Ø ROS 8.5% (+/-2%) Measures Expansion of service business Improvement of in-house-processes Cost reduction 16
Industrial Services Target Ø ROS 8.5% (+/-1%) Measures Lean structure Improvement of underperforming segments 17
Group strategy Operational excellence Sustainable group structure Profitable growth Effective governance Sustainability 18
Focus on Transport-Related Engineering MAN Roland concluded in July 2006 MAN TAKRAF concluded in September 2006 Steel trade business to be concluded in Q3 2007 Strong platform for profitable growth 19
Consolidation truck industry Major truck market trends 1 Stricter emission standards 2 Cross-border transportation 3 Bigger customers 4 Customer finance 5 Total operating cost Demands on manufacturers Increased R&D Stronger sales and service network One-stop shop solutions Full product range Strong and innovative financing Focus on life-cycle costs Operational excellence + scale = success 20
Truck Combination of MAN/Scania/VW European champion strong enough to face future challenges Stock listed company with major focus on Commercial Vehicles New industrial stockholder basis for amicable solution Positive for all stakeholders 21
Group strategy Operational excellence Sustainable group structure Profitable growth Effective governance Sustainability 22
Profitable growth Commercial Vehicles Delivered units Diesel Engines Delivered units Turbo Machinery Sales (in million) Industrial Services Sales (in million) 2005 74,218 344 694 1,414 Target 2010 110,000 500 1,500 2,000 10% annual sales growth until 2010 23
Stepping up presence in growth markets Truck assembly in Poland and India Diesel Engineering Center in India Bus assembly in Mexico Turbo manufacturing in China MAN Houses in Dubai and Beijing 24
Group Strategy Operational excellence Sustainable group structure Profitable growth Effective governance Sustainability 25
Industrial Governance Strategy process Management audits New pension scheme New variable compensation New controlling process 26
Group Strategy Operational excellence Sustainable group structure Profitable growth Effective governance Sustainability 27
Sustainability Economic responsibility Environmental responsibility Social responsibility 28
Economic responsibility BILD Technological leadership Operational excellence Value for stakeholders 29
Environmental responsibility BILD Engine technology New engine platforms ready for even tighter standards after Euro 5 SCR and EGR technology Alternative engine technology Hybrid CO 2 neutral synthetic fuels (BTL) 30
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Social responsibility Attractive employer Partnership universities/ MAN scholarship Compliance 32
Agenda Review 2006 Strategy Outlook 2007 33
Good start into 2007 Order intake 21% increase to 6,355 billion (January April) Sales 11% increase to 4,302 billion (January April) Operating profit 107 million increase to 318 million (January-March) ROS + 2.2%-points to 9.6% (January-March) EPS 0.51 increase to 1.49 (January-March) 34
Outlook for 2007 Order intake at same high level as previous year Sales increase of approx. 10% Operating profit considerably outpacing sales ROS at first-quarter level 35
250 years Engineering the Future 1758 2008 36
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