Corporate Presentation - January 2020 - ElringKlinger AG
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Corporate Presentation January 2020
ElringKlinger
In a nutshell
Headquartered in
Dettingen/Erms, EUR 1,699 mn
in sales
close to Stuttgart
45 locations 5.9%
EBIT margin pre PPA
Family as a More than
strong anchor 10,000
shareholder employees
Founded in
+10%
CAGR since 2005 1879
All figures refer to FY 2018
Corporate presentation | January 2020 2
Markets
Megatrends trigger technological transformation process
Urbanization Safety systems
Scarcity of resources Autonomous driving
Global
megatrends
Globalization
transform the Efficient propulsion
automotive
industry
Technological progress Connectivity
Climate change Shared mobility
Corporate presentation | January 2020 3
Markets
EU tightens CO2 limits until 2030 even further
CO2 limits – in g/km
EU 2021 South Korea 2020
95g CO2/km average 97g CO2/km average
fleet emissions fleet emissions
China 2025
EU 2025 94g CO2/km average
USA 2025 15 % reduction of average fleet
fleet emissions
91g CO2/km average emissions (base year: 2021)
fleet emissions Japan 2030
32% reduction of average fleet
emissions (base year: 2016)
EU 2030
37.5 % reduction of average fleet
emissions (base year: 2021)
Source: Fraunhofer ISI, ElringKlinger research
Corporate presentation | January 2020 4
Markets
New drive trains will be single growth driver from 2025 onward
Global light vehicle production per drivetrain – in million units
CAGR
+2%
…for tapping the potential
Managing the growth…
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Combustion Hybrids Full electric
Source: PWC Autofacts, ElringKlinger research
Corporate presentation | January 2020 5
Group strategy
Managing the growth in classical business areas
Cylinder-head Specialty Shielding Plastic housing
gaskets gaskets technology modules
• Strong market positions associated with technological niches
• Benefiting from global production network
• Utilizing profound and detailed product and process know-how
• Concentrating on improved processes to avoid additional costs
• Optimizing inventories
• Repayment of financial debt
• Disciplined investments for managing the growth
• Stable growth path of sales in the medium term according to market development
Corporate presentation | January 2020 6
Group strategy
Generating future growth in new business areas
Battery Fuel cell Electric Structural
systems systems drive unit lightweighting
• Established supplier • PEM fuel cell stack • Strategic minority • Unique production
for large series of ready for marketing stake in engineering technology
Battery components, • Components service provider • Series orders in
i.e. cell contacting available as well hofer powertrain delivery phase
systems • Currently set-up of
• Next step: • Next step: further
• Next step: installation of small series ramp-ups and new
industrialization of automated production contracts expected
complete battery production line
systems
• Focused capex spending
• Strong growth of e-mobility areas from 2020/21 on with lightweighting further ramping up
Corporate presentation | January 2020 7
Group strategy
ElringKlinger with expertise for components, modules and systems
Battery
Fuel cell
EDU
Components Modules Systems Customers‘
needs
Corporate presentation | January 2020 8
Group strategy
ElringKlinger’s sales structure of products will change
Sales split (actual and ambition) – in % of total sales
Actual 2018 Ambition 2030
Non-automotive Non-automotive
products products
Aftermarket
5% Aftermarket ~10%
9% Functional
Structural components
lightweight ~10%
7%
and e-mobility
products
25%
79%
Structural
lightweight and
Functional
e-mobility
components
products
Corporate presentation | January 2020 9
Group strategy
Nominated e-mobility volumes create a healthy basis for future sales
Nominated volumes* – in EUR million
1,000
~15%
• Strong growth particularly in the
fuel cell and battery business
~50%
~15% • Acceleration especially after
ramp-up years 2019 and 2020
~55%
• Includes systems as well as
~25% ~25% components nominations by
~35%
~40% ~60% ~30% different OEMs worldwide
~35% ~15%
2019e 2020e 2021e 2022e 2023e
EDU Fuel cell systems Battery systems and components
* Scheduled revenues in e-mobility products according to received OEM nomination letters, final revenues dependent on definitely called volumes
Corporate presentation | January 2020 10Group strategy
Major new contract wins for new business fields
New US OEM New US OEM New US OEM Chinese OEMs
#
Cross-car beam Cross-car beam Fuel cell systems
More than
SOP 2020 SOP 2020 20 development
Front-end carrier projects
Battery system
SOP 2021
Corporate presentation | January 2020 11Group strategy
Higher degree of vertical integration results in more content per car
Content per car – in EUR
Present Future
40 - 60 EUR Content per car 100 - 10,000 EUR
(100-150 EUR incl. cross-car beam)
Corporate presentation | January 2020 12Financials
Q3 2019
Strong sales growth despite market downturn
Order intake – in EUR million Order backlog – in EUR million
+6.3% +4.0%
FX adjusted: 0.8% FX adjusted: +1.9%
498 1,077
412 420 438 1,063 1,069
391
1,027 1,020
Q3 2018 Q4 Q1 Q2 Q3 2019 Q3 2018 Q4 Q1 Q2 Q3 2019
Sales – in EUR million Sales bridge – in EUR million/ in %
+6.4% +6.4%
406 432 441 434 432 431.9
+16.2
-0 +4.0%
+9.9 -0%
405.8
+2.4%
Q3 2018 Q4 Q1 Q2 Q3 2019 Q3 2018 FX M&A Organic Q3 2019
Corporate presentation | January 2020 14Q3 2019
Sales in North America continue to grow strongly
Sales by region – in EUR million
Share of total sales – in %
South America and Rest of World
20 (19)
Germany
Asia-Pacific 4% 97 (103)
80 (77) (5%)
22%
19% (25%)
(19%)
EUR
432
million
27% 28%
(23%) (28%)
North America Rest of Europe
115 (92) 120 (115)
2018
Previous year’s Q3 figures in brackets
Corporate presentation | January 2020 15Q3 2019
Sequential improvement of earnings over the 2019 quarters
EBIT (pre PPA) – in EUR million
EBIT margin (pre PPA) – in % of total sales EBIT (pre PPA) bridge – in EUR million
-13.0%
-13.0%
23.9
20.8
23.9 +4 -4
11.8 +2
10.7 -5
5.9% 6.9 4.8% 20.8
Q3 2018 Q4 Q1 Q2 Q3 2019 Q3 2018 Tariffs/ NAFTA/ Cost Others* Q3 2019
duties Ramp-ups savings
Net income (attr. to shareholders) – in EUR mn Earnings per share – in EUR
-38.0% -35.3%
10.8 0.17
6.7 0.11
-1.2 -1.5 -0.02 -0.02
-8.6 -0.14
Q3 2018 Q4 Q1 Q2 Q3 2019 Q3 2018 Q4 Q1 Q2 Q3 2019
Differences due to rounding * Net impact includes increase personnel cost, R&D capitalization and others
Corporate presentation | January 2020 16Q3 2019
Aftermarket segment expanded its sales and improved its margin
Sales – in EUR million
EBIT margin – in % of segmental sales
Original Equipment (OE) Aftermarket
+5.4%
+20.2%
335 365 361 361 353
38 37 45 41 45
3.1% 1.8% 15.7% 18.8%
Q3 2018 Q4 Q1 Q2 Q3 2019 Q3 2018 Q4 Q1 Q2 Q3 2019
Engineered Plastics Industrial Parks & Services
(sales only)
-0.3%
+9.1%
30 32 29 30
27 3.3 3.7 3.5 3.6
21.9% 3.1
16.3% 1.0 1.2 1.1 1.2 Industrial Parks
1.1
2.3 2.5 2.4 2.0 2.4 Services
Q3 2018 Q4 Q1 Q2 Q3 2019
Q3 2018 Q4 Q1 Q2 Q3 2019
Corporate presentation | January 2020 17Q3 2019
Strong focus on cash flow optimization
Earnings Net working capital Capex
Measures with short and mid-term Measures:
impact: • Extending payment terms for
• Group-wide cost reduction program trade payables Disciplined
approach
• Optimizing op. performance in • Reducing level of trade receivables
continued
Switzerland and North America • Improving inventories
• Paybacks of duties in Q3
Improvement of operating free cash flow
Corporate presentation | January 2020 18Q3 2019
Gradual improvement of net working capital in 2019
Net working capital – in EUR million
-15.8%
606
568 9 Optimizing inventories in locations worldwide
499 478
6
10 9 Current contract assets • Focus on supplier-owned inventories
• Increase of inventory turnover
415 • …
401
393 387 Inventories
Balancing trade receivables and trade payables
• Reduction of share of overdue receivables
306 332 • Reduction of payment periods toQ3 2019
Disciplined capex approach continued
Capex (in PPE) – in EUR million
Capex ratio – in % of total sales Operating free cash flow – in EUR million
-52.9% >+100%
53.9 98.6
41.9
30.8
28.8
25.4
20.7 2.6
13.3
-19.3
5.9
-46.5
Q3 2018 Q4 Q1 Q2 Q3 2019 Q3 2018 Q4 Q1 Q2 Q3 2019
Corporate presentation | January 2020 20Q3 2019
Cash flow used for net debt reduction
Net financial debt – in EUR million Maturity structure of financial debt – in EUR mn
-5.9%
796
724 46 700 681
45 50 IFRS 16
196 514
187 Current
297 218
financial debt
617
556 520 Non-current 180
472
financial debt
48 177 46
-45 3
-63 -107 Cash
-88 due 2019
and cash
Dec. 31, Mar. 31 Jun. 30 Sep. 30, equivalents -107
2018 2019 -130
Cash and Credit Credit Current Non- Non-
cash lines lines 5 years)
Corporate presentation | January 2020 21Outlook
Outlook 2019: Markets
Production estimates adjusted downwards monthly
Forecasts global auto production 2019 – in % Forecasts auto production China 2019 – in %
11.2
8.3 8.8
5.9 6.1
4.9 4.2
3.3 3.7 3.3 3.4
2.0
0.2 0.2
-1.1 -0.8
-3.2 -3.8
-5.5 -5.3
Q3 Q4e Q3 Q4e
Estimation in Jan 19 May 19 Oct 19
Mar 19 Jul 19 Source: JP Morgan, IHS, PWC Autofacts, ElringKlinger research
Corporate presentation | January 2020 23Outlook 2019: Markets
Global production forecast for FY 2019
Light vehicle production growth – in % vs. 2018
-4 to -2 % -3 to -1% -9 to -7 %
North America Europe China
• Strong demand for SUV • Lowered production • Suffering from trade
• Trade conflict unresolved schedules conflict
• Strike with impact on • Brexit unclear • Premium segment still
production solid
-3 to -1 % -6 to -4%
South America Global
• Slight growth in Brazil
• Growth due to base effect
Source: IHS, PWC Autofacts, ElringKlinger research
Corporate presentation | January 2020 24Expectations for FY 2019
Various factors with positive impact on FY 2019 earnings
External factors Internal factors
• Material cost and duties • Optimization of operating performance
– Antidumping and countervailing duties in North America
avoided in H2 • Further improving fixed cost base in
– Expansion of supplier base Switzerland
– Incremental effect from higher raw
material prices will phase out • Scheduled real estate sale
• Tightened cost saving measures, esp.:
• Personnel cost: Collective wage increase – Reduction of personnel cost
as of April 2018 with no incremental effect – Reduction of discretionary cost
as from Q2 – Hiring freeze in classical business areas
Expected EBIT margin pre PPA of around 4 to 5% in FY 2019
Corporate presentation | January 2020 25Outlook 2019: Group
2019 – A year of transformation
2019 Mid-term
Global LV production:
0 –1%
-6% to -4%
LV production CAGR:
in a challenging environment
+2%
(prev.: -4 to -2%)
Organic sales: Organic sales:
2 to 4 %-points above global markets
above global markets
EBIT margin pre PPA: EBIT margin pre PPA:
~ 4 – 5% Successive improvement
Corporate presentation | January 2020 26Outlook 2019: Group
Further indicators for FY 2019 and in the medium term
FY 2018 FY 2019
actual expected Mid-term
ROCE in % 5.5% Below prior year level Increasing based on
earnings and NWC
improvements
R&D costs in % of total sales 5.1% ~ 5 - 6% ~ 5 - 6%
(incl. capitalization)
Capex in % of total sales 9.6% Below 9% Ongoing disciplined
(in PPE) approach
Net working capital in % of total sales 33.4%* Below prior year level Slight step-by-step
(NWC) improvement
Operating FCF in EUR million -86.2 Positive Positive
Equity ratio in % of total assets 42.8% 40 - 50% 40 - 50%
Net debt/EBITDA 3.7 Below prior year levelAppendix
ElringKlinger
Structural overview
ElringKlinger Group
Sales EUR 1,699 million EBIT (pre PPA) EUR 100.2 million
Employees 10,429 EBIT margin (pre PPA) 5.9 %
Original Equipment Aftermarket
83% Sales: EUR 1,408 million 9% Sales: EUR 159 million
of Group sales
of Group sales Employees: 9,232 Employees: 203
Exhaust Gas Purification Engineered Plastics
OthersMission statement
What is driving us
Our vision Our mission
Being an essential
partner by
(1)Providing technologically
Green mobility sophisticated solutions for
customers’ needs
(2)Shaping performance and
quality to the next level
(3)Assuming social responsibility
as a global corporate player
Corporate presentation | January 2020 30Group – Last 5 quarters
Key figures
Q3 2019 Q2 2019 Q1 2019 Q4 2018 Q3 2018
Order intake 438 420 498 391 412
Order backlog 1069 1,063 1,077 1,020 1,027
Sales 432 434 441 432 406
EBITDA 50 39 35 38 48.4
EBIT pre PPA 20.8 10.7 6.9 11.8 23.8
EBIT margin pre PPA (in %) 4.8 2.5 1.6 2.7 5.9
EBIT (reported) 20.3 10.2 6.4 10.6 22.9
EBT 15.3 1.5 5.4 7.2 21.8
Net income attributable to shareholders 6.7 -8.6 -1.5 -1.2 10.8
Earnings per share (in EUR) 0.11 -0.14 -0.02 -0.02 0.17
Capex (in PPE) 25.4 20.7 28.8 41.9 53.9
Operating free cash flow 30.8 98.6 -19.3 2.6 -46.5
Net working capital 478* 499* 606* 567 618
Equity ratio (in %) 40.7 40.7 40.9 42.8 42.1
Net financial debt 682 700 796 724 729
Employees (as at quarter-end) 10,492 10,411 10,485 10,429 10,231
All figures in EUR million unless otherwise described, differences due to rounding * Incl. current contract assets, less current contract liabilities
Corporate presentation | January 2020 31Group – Last 5 quarters
Segmental figures
Q3 2019 Q2 2019 Q1 2019 Q4 2018 Q3 2018
Group Sales 432 434 441 432 406
EBIT (reported) 20.3 10.2 6.4 10.6 22.9
EBIT margin (in %) 4.7 2.3 1.5 2.5 5.6
Original Equipment Sales 353 361 361 365 335
EBIT (reported) 6.4 2.0 -5.3 2.2 10.3
EBIT margin (in %) 1.8 0.6 -1.5 0.6 3.1
Aftermarket Sales 45 40.9 44.7 36.7 37.6
EBIT (reported) 8.5 6.7 7.3 4.1 5.9
EBIT margin (in %) 18.8 16.4 16.3 11.2 15.7
Engineered Plastics Sales 30 28.7 32.2 27.0 30.2
EBIT (reported) 4.9 1.7 4.1 3.7 6.6
EBIT margin (in %) 16.3 5.9 12.7 13.7 21.9
Services Sales 2.4 2.0 2.4 2.5 2.3
EBIT (reported) 0.3 -0.4 0.3 0.3 0.0
EBIT margin (in %) 12.5 -20.0 12.5 10.1 0.0
Industrial Parks Sales 1.2 1.1 1.1 1.2 1.0
EBIT (reported) 0.2 0.1 0.0 0.3 0.1
EBIT margin (in %) 16.7 9.1 0.0 27.3 10.0
All figures in EUR million unless otherwise described, differences due to rounding
Corporate presentation | January 2020 32Group – FY 2018
Consolidated income statement
2018 2017
Sales revenue 1,699 1,664
Cost of sales -1,329 -1,256
Gross profit 370 408
Gross margin in % 21.8 24.5
Selling expenses -147 -142
General and administrative expenses -84 -77
Research and development costs -76 -71
Other operating income 46 31
Other operating expenses -13 -12
Operating result (EBIT) 96 137
Finance income 33 21
Finance costs -43 -48
Share of result of associates -5 0
Net finance costs -15 -27
Earnings before taxes (EBT) 81 110
Income tax expenses -34 -36
Net income 48 74
of which: attributable to non-controlling interests 4 4
of which: attributable to shareholders of ElringKlinger AG 44 70
Basic and diluted earnings per share (EPS) in EUR 0.69 1.10
All figures in EUR million unless otherwise describe, differences due to rounding
Corporate presentation | January 2020 33Group – FY 2018
Consolidated statement of financial position
As of Dec As of Dec As of Dec As of Dec
Assets 31, 2018 31, 2017
Liabilities and equity 31, 2018 31, 2017
Intangible assets 190 190 Share capital 63 63
Property, plant, and equipment 998 930 Capital reserves 118 118
Investment property 17 17 Revenue reserves 721 711
Financial assets 3 1 Other reserves -50 -40
Shares in associates 23 29 Equity attr. to shareh. of ElringKlinger AG 853 852
Non-current income tax assets 0 0 Non-controlling interest in equity 37 37
Other non-current assets 15 4 Equity 890 890
Deferred tax assets 12 17 Provisions for pensions 124 126
Non-current assets 1,257 1,188 Non-current provisions 20 12
Inventories 401 370 Non-current financial liabilities 472 479
Current contract assets 6 0 Deferred tax liabilities 15 14
Trade receivables 306 303 Other non-current liabilities 12 4
Current income tax assets 9 7 Non-current liabilities 642 635
Other current assets 51 48 Current provisions 11 23
Cash and cash equivalents 45 45 Trade payables 136 119
Current assets 816 773 Current financial liabilities 297 222
Assets held for sale 6 62 Current contract liabilities 10 0
Total assets 2,080 2,022 Tax payable 12 15
Other current liabilities 81 96
Current liabilities 547 474
Liabilities in connection with assets held for sale 0 24
Total liabilities and equity 2,080 2,022
All figures in EUR million unless otherwise describe, differences due to rounding
Corporate presentation | January 2020 34Group – FY 2018
Consolidated statement of cash flows
2018 2017 2018 2017
Earnings before taxes (EBT) 81 110 Proceeds from disposals of PPE, intangible
Depreciation/amortization (less write- assets and investment property 1 1
ups) of non-current assets 100 101 Proceeds from disposals of financial assets 3 3
Net interest 15 13 Proceeds from the disposal of subsidiaries 57 0
Change in provisions -6 7 Payments for investments in intangible
Gains/losses on disposal of non-current assets -15 -11
assets 0 1 Payments for investments in PPE and
Share of result of associates 5 0 investment property -164 -156
Change in inventories, trade receivables Payments for investments in financial assets -3 -3
and other assets not resulting from Payments for the acquisition of associates 0 -29
financing and investing activities -52 -115
Payments made/received for the acquisition
Change in trade payables and other of subsidiaries and other entities 0 1
liabilities not resulting from financing and
Net cash from investing activities -121 -193
investing activities 20 27
Dividends paid to shareholders and to
Income taxes paid -31 -51
non-controlling interests -34 -34
Interest paid -12 -11
Proceeds from addition of long-term loans 77 235
Interest received 1 0
Payments for the repayment of long-term
Other non-cash expenses and income -30 11 loans -73 -44
Net cash from operating activities 92 95 Changes in current loans 60 -47
Net cash from financing activities 30 109
Changes in cash 1 12
Effects of currency exchange rates on cash -1 -3
Cash at beginning of the period 45 39
Cash at end of period (as per financial
statement) 45 45
All figures in EUR million unless otherwise describe, differences due to rounding
Corporate presentation | January 2020 35Group – Last 5 years
Key figures
2018 2017 2016 2015 2014
Order intake 1,735 1,732 1,694 1,615 1,419
Order backlog 1,020 1,001 933 796 688
Sales 1,699 1,664 1,557 1,507 1,326
EBITDA 197 238 231 223 233
(Adjusted) EBIT pre PPA 100 142 140 140 162
(Adjusted) EBIT margin pre PPA in % 5.9 8.5 9.0 9.3 12.2
EBIT (reported) 96 137 136 135 154
EBT 81 110 124 129 153
Net income attributable to shareholders 44 70 79 92 106
Earnings per share in EUR 0.69 1.10 1.24 1.45 1.67
Dividend per share in EUR 0.00 0.50 0.50 0.55 0.55
Capex (in PPE) 164 156 171 176 147
Operating free cash flow -86 -67 -4 -65 -12
ROCE in % 5.5 8.2 8.7 9.5 12.4
Net working capital 567 553 525 523 466
Equity ratio in % 42.8 44.0 47.2 48.5 49.7
Net financial debt 724 655 539 487 348
Employees (as at Dec. 31) 10,429 9,611 8,591 7,912 7,255
All figures in EUR million unless otherwise describe, differences due to rounding
Corporate presentation | January 2020 36Group – Last 5 years
Segmental figures
2018 2017 2016 2015 2014
Group Sales 1,699 1,664.0 1,557.4 1,507.3 1,325.8
EBIT (reported) 96 137.3 135.6 135.2 154.0
EBIT margin in % 5.7 8.3 8.7 9.0 11.6
Original Equipment Sales 1,407.7 1,382.4 1,294.3 1,255.8 1,089.7
EBIT (reported) 50.7 86.3 88.9 91.2 111.2
EBIT margin in % 3.6 6.2 6.9 7.3 10.2
Aftermarket Sales 159.5 156.7 147.3 142.2 130.7
EBIT (reported) 24.9 31.8 30.5 28.2 25.1
EBIT margin in % 15.6 20.3 20.7 19.8 19.2
Engineered Plastics Sales 117.8 111.1 101.7 96.6 92.9
EBIT (reported) 19.5 18.5 14.9 13.2 15.4
EBIT margin in % 16.6 16.7 14.7 13.7 16.6
Services Sales 9.7 9.5 9.7 8.3 8.1
EBIT (reported) 0.7 1.2 1.6 2.0 1.9
EBIT margin in % 7.2 12.6 16.5 24.1 23.5
Industrial Parks Sales 4.3 4.3 4.5 4.3 4.5
EBIT (reported) 0.3 -0.5 -0.3 0.7 0.4
EBIT margin in % 7.0 n.a. n.a. 16.3 8.9
All figures in EUR million unless otherwise describe, differences due to rounding
Corporate presentation | January 2020 37Group
Product portfolio
Cylinder-head Gaskets E-Mobility
Battery module
Specialty Gaskets PEM fuel cell
Electric drive unit (EDU)
Shielding Technology Lightweighting/
Thermal shielding Elastomer Technology
Acoustic shielding Door module carrier
Cockpit cross-car beam
Plastic modules
(cam cover)
Corporate presentation | January 2020 38Group strategy
ElringKlinger provides a transformed portfolio
Present Future
Functional
Disk
Brake carrier Components
Cylinder-head Gaskets Metal- hat
elastomer
Strategic areas
gaskets Engine
Specialty Gaskets Tank Dampening
shielding
Underbody shielding pan
Shielding Technology protection
Front-end Door Side Light-
Cross-car
Lightweighting/Elastomer carrier module impact weighting
beam
carrier protection
E-Mobility Cell
casing Metallic
bipolar Cell PEM
plate contact Fuel cell Electric
system stack drive train
Battery
module E-Mobility
Corporate presentation | January 2020 39Group strategy
Fuel cell systems will be essential for certain applications
Why fuel cell technology?
• H2 production by solar or wind power enables
CO2-neutral propulsion
• Better storability of hydrogen
• Use of the existing filling station infrastructure
• Fast refueling
Why ElringKlinger?
• Ready for series production
• Electrical output of 2 to 150kW possible based on
sophisticated metallic bipolar plates
• Optional integration of peripheral components and
system functionalities into the module
• Suitable for long distances, recurring applications (e.g. buses) and commercial vehicles
• High customer interest esp. in Asia perceived, numerous development projects in progress
Corporate presentation | January 2020 40Group strategy
Battery technology enables mobility based on renewable resources
Why battery technology?
• Reduced emissions
• Lower operating and maintenance costs
• Electric motor: quiet and efficient
Why ElringKlinger?
• Ready for series production of battery systems
• Long service life due to robust design with cell
clamping concept and use of proven ElringKlinger
busbars
• Cell contact system for prismatic lithium-ion cells in
series production since 2012
• Battery-powered vehicles are an eco-friendly solution for short distances
• First order for the production of complete battery systems received in 2018
Corporate presentation | January 2020 41Group strategy
Electric drive unit completes full electric product range
Why electric drive unit (EDU)?
• Hybrid, fuel cell and e-vehicles are reliant on highly
efficient electric drives
• EDU reduces the complexity and powertrain
becomes more compact and efficient
Why ElringKlinger?
• ElringKlinger and hofer powertrain offer
complementary core competencies
• High-end solution with focus on small-series
production in sports and luxury car segment
• Compact coaxial electrive drive unit
• Customer-specific planetary gearing in conjunction
with a differential
• EDU is needed in every hybrid and battery driven vehicle.
• High system efficiency ensures a higher electrical range or, alternatively, a reduction in the
battery capacity required.
Corporate presentation | January 2020 42Group
ElringKlinger represented in all important auto regions
Production locations of global top 15 OEMs ( )
ElringKlinger production sites ( )
Germany
UK
China
Eastern
France Europe/
Spain Turkey Korea
Italy Japan
USA/Canada
India Southeast Asia
Mexico
Capex (in PPE)/ratio – in EUR million/in %
South South Africa 176 171
America 156 164
147
11.1 11.7 11.0
9.3 9.6
2014 2015 2016 2017 2018
Corporate presentation | January 2020 43FY 2018: Sales
Sales increase primarily driven by strong demand in NAFTA
Growth LV production vs. sales ElringKlinger (FX adjusted) – in %
Sales by region – in EUR million resp. %
Europe
+1.2%
NAFTA Asia
27.8%
+1.4%
+15.5% -0.4%
Market EK
FY 2018
1.1% -1.3%
-1.0% Market EK
FY 2018
Market EK Market EK
FY 2018 Q4 2018
5%
19% 25%
11%
5% 36%
15%
2008 Germany
33%
21% Rest of Europe
NAFTA
30%
2018 Asia-Pacific
South America and Rest of World
Corporate presentation | January 2020 44FY 2018: Sales
International diversified customer base
Sales by customer group – in % of total sales
American
OEMs
9% 18% (19%)
Other
30% (38%) 6%
3%
EUR 10% German
1,699 OEMs
million 22% (16%)
7%
5%
Aftermarket
9% (9%) French
OEMs
Tier 1 5% (4%)
16% (14%)
Corporate presentation | January 2020 45Group
Focused R&D activities
R&D – in EUR million
R&D ratio – in % of total sales
5.0% 4.7% 4.8% 4.6% 5.1%
87
• Integration of tools implies a
75 technological lead position in the
71
67 development of ideas
64
• Main focus: lightweight components,
e-mobility
76
• 590 R&D employees at sites of parent
61 71
58
57
company
• 80 new international patents in 2018
• Target R&D ratio (incl. capitalization):
5 – 6% of total sales, capitalization rate
9 10 11 thereof ~20%
7 4 capitalized
2014 2015 2016 2017 2018
Corporate presentation | January 2020 46Group
Senior management
Theo Becker, CTO (since 2006) Reiner Drews, COO (since 2018)
Responsible for the business units E-Mobility, New Responsible for the business units Cylinder-head Gaskets,
Business Areas, Tooling Technology divisions as Specialty Gaskets, Lightweight/ Elastomer Technology and
well as the corporate units Purchasing, Real Estate Shielding Technology, the corporate units Production
& Facility Management and the Thale plant | With Management and Quality & Environmental Management as
ElringKlinger since 1994 well as ElringKlinger AG plants | With ElringKlinger since 2006
Dr. Stefan Wolf, CEO (since 2005) Thomas Jessulat, CFO (since 2016)
Responsible for Group companies, the corporate units Legal, HR, Strategic Responsible for the corporate units
Communications, Marketing & Communications and OE Sales as well as the Aftermarket Finance, Controlling, IT, Logistics and
division | With ElringKlinger since 1997 | Chairman of Baden-Württemberg‘s Business Development as well as the
Employers‘ Association of the Metal and Electric Industry (Südwestmetall) | Member of Industrial Parks division | With
the Management Board of the German Association of the Automotive Industry (VDA) ElringKlinger since 2005
Corporate presentation | January 2020 47Group
140 years of experience and solid shareholder structure
History of ElringKlinger in very brief Shareholder structure as at November, 2019
1879 Paul Lechler establishes a
merchandising business in
Stuttgart for technical products
and gaskets. 1885 Richard Klinger Institutional Private Lechler
establishes an engineering office
in Vienna. investors investors Family
1924 The first Lechler cylinder-
head gaskets are produced.
1964 Elring production and
development moves from 23.6% 24.4% 52.0%
1993 Elring goes to Asia: The Stuttgart to Dettingen/Erms.
joint venture Changchun Elring
Gaskets Co. Ltd. has been 1994 Elring GmbH merges with
founded.
Automotive Division of Richard
Klinger GmbH to ElringKlinger
1997 ElringKlinger founds new GmbH.
plants in UK, Brazil, Mexico, and the
U.S. 2000 ElringKlinger GmbH merges
with parent company ZWL
Grundbesitz- und Beteiligungs-AG and
2001 ElringKlinger AG intensifies is renamed as ElringKlinger AG.
R&D work on fuel cell components,
especially on its internal sealing. 2002 Registered shares of
ElringKlinger AG are traded at
2010 ElringKlinger AG Frankfurt and at Stuttgart Stock
receives its first order for series Exchange.
production of cell contact
systems used in lithium-ion 2013 ElringKlinger AG acquires
batteries. tool maker Hummel Formen GmbH
which enables the company to offer
2017 ElringKlinger AG acquires a structural lightweight components.
stake in hofer powertrain and thus,
extends its portfolio to alternative
drive technologies.
2018 ElringKlinger sells interest
in Hug and in new enerday
Corporate presentation | January 2020 48IR calendar and contact
Date Event
Jan 21, 2020 Conference Frankfurt
Mar 30, 2020 Annual Report 2019
May 7, 2020 Q1 2020
May 19, 2020 Annual General Meeting
From left to right:
Heiderose Mall, Christoph Staib, Kathrin Graf, Sabrina Haufler, Dr. Jens Winter
ElringKlinger AG Investor contacts
Strategic Communications Dr. Jens Winter Kathrin Graf
Head of Strategic Communications Senior Manager Strategic Communications
Max-Eyth-Str. 2 | E: jens.winter@elringklinger.com E: kathrin.graf@elringklinger.com
72581 Dettingen/Erms | Germany T: +49 7123 724 88335 T: +49 7123 724 88279
E: investor-relations@elringklinger.com
Corporate presentation | January 2020 49Disclaimer Forward-looking statements and predictions This presentation contains statements about the future. These statements are based on current expectations, market evaluations and predictions by the Management Board, and on information that is currently available to them. The statements about the future should not be interpreted as guarantees of the future developments and results that they refer to. Whilst the Management Board is convinced that the statements that have been made, and the convictions and expectations on which they are based, are realistic, they rely on suppositions that may conceivably prove to be incorrect; future results and developments are dependent on a multitude of factors, they involve various risks and imponderabilities that can affect whether the ongoing development deviates from the expectations that have been expressed. These factors include, for example, changes to the general economic and business situation, variations of exchange rates and interest rates, poor acceptance of new products and services, and changes to business strategy. Corporate presentation | January 2020 50
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