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Developing the future.
16TH ANNUAL GENERAL MEETING THYSSENKRUPP AG Remarks by Dr. Heinrich Hiesinger Chief Executive Officer Bochum, January 30, 2015
Annual General Meeting January 30, 2015 2 Developing the future.
Group back in profit again for first time in 3 years with net income of ~€195 million; €210 million after deducting minority interest
Adjusted EBIT doubled to ~€1.3 billion
Order intake up 7 percent to €41.4 billion
Group sales up 7 percent to €41.3 billion
Proposal to pay dividend of €0.11 per share
Overview of Key Figures for FY 13/14
Annual General Meeting January 30, 2015 3 Developing the future.
60
70
80
90
100
110
120
130
140
150
Dec. 2014
Sept. 2014
Jun. 2014
Mar. 2014
Jan. 2014
Stock Performance Indexed to December 30, 2013 [%]
DAX 30
ThyssenKrupp
€21.26
€17.68
Positive performance as a result of systematic implementation of Strategic Way Forward &
efficiency programs
€22.63 €20.78
€19.47
€21.29
Annual General Meeting January 30, 2015 4 Developing the future.
2014 2015 2016 2017 2018 2019 2020 2011 2012 2013
Where We Are Now: Turnaround Not Yet Achieved
Turning point
!
Sustainable Value Generation Transformation Stabilization
Annual General Meeting January 30, 2015 5 Developing the future.
Focus Today
Results Fiscal Year 2013/14
Strategic Way Forward and Diversified Industrial Company
Targets of Group and Business Areas
Strengthening of Integration
Annual General Meeting January 30, 2015 6 Developing the future.
Adjusted EBIT of Business Areas in 2013/14 in million €
1,555
1,758
+13%
369
-116
+418%
2013/14 2012/13 2013/14 2012/13
Capital Goods Businesses Materials Businesses
Annual General Meeting January 30, 2015 7 Developing the future.
Overview of Key Financial Ratios
Refinancing • With bond and credit facility, financing
measures at attractive interest rates €3.25 billion
Key indicators Comment FY 2013/14 Performance vs. prior year
Free cash flow
Net financial debt
• Second consecutive year clear positive FCF
• Reduced by 40% compared with peak of FY 2011/2012
€799 million
€3.5 billion
Free cash flow (before
divestments)
• Settlement paid to Deutsche Bahn • Higher net working capital requirement
€(254) million
Equity
Gearing
• Dec. 2013: Capital increased by ~€880 million • Closure of Outokumpu and TK Steel USA
• Improved by ~92 percentage points
€3.2 billion
109%
Annual General Meeting January 30, 2015 8 Developing the future.
Investments in the Future of our Business Areas Investments in billion €
• Three new plants in China • Expansion camshaft technology (Brazil,
NAFTA, Germany, China)
• Expansion and modernization • Smaller acquisitions
• Expansion of regional organization • Stronger presence in the USA
• Site for aviation industry in India • Modernization of plants in Mexico
• Relining of blast furnace 2 in Duisburg • Modernization of several units
Main investments in 2013/14
CT: Components Technology
IS: Industrial Solutions
MX: Material
Services
ET: Elevator Technology
SE: Steel Europe Total
2011/12 - 2013/14
4.2
2013/14
1.1
Annual General Meeting January 30, 2015 9 Developing the future.
Examples of New Projects and Major Contracts
IS: Construction of cement plant
IS: Construction of fertilizer plant
ET: 300 and 130 escalators for Beijing and Shenzen metro
ET: Elevators in Berlin TV tower replaced
IS: Construction of cement plant
CT: Steering sys-tems and dampers for new Mercedes S-, C- and E-class
IS: Construction of cement plant CT: Electric
assisted steering for Volvo
CT: Springs and stabilizers for VW’s biggest model platform
CT: Slewing bearings for wind industry
IS: Major submarine contract
ET: Hand over of TWIN elevators in Olympic Park Observation Tower
Annual General Meeting January 30, 2015 10 Developing the future.
Strategic Way Forward
Strategic Push
Financial Stability
Perfor-mance Orient-ation
Customers & Markets
People Success
Change Manage-
ment
Diversified Industrial Company More & Better
ThyssenKrupp Positioning
Annual General Meeting January 30, 2015 11 Developing the future.
Diversified Industrial Company
Leading Engineering Competence
Active portfolio management
One integrated Group
Capital efficiency
Leading market positions
Benchmark
performance Profitable
growth
Diversified Industrial Company
Annual General Meeting January 30, 2015 12 Developing the future.
Optimization of Business Areas Optimizing the Company Overall
Sharpened strategic objectives,
programs and roadmaps
Integrated and
focused Business Areas
Focusing on customers, competitiveness and
operations
Corporate leadership, support & initiatives
Strong parenting framework realizing
strategy, scale & scope benefits
Realizing the strategic benefits of
diversification & integration
+
Business Areas
CT
ET
IS
MX
SE
AM
+
Overall company
Annual General Meeting January 30, 2015 13 Developing the future.
Targets for our Business Areas
Components Technology
Elevator Technology
Industrial Solutions
Materials Services
Steel Europe + Steel Americas
Profitability Profitability before growth
Profitability before growth
Profitability Growth before profitability
• EBIT margin: 6-8%
• EBIT margin: 15%
• EBIT: €1 bn
• EBIT margin: 6-7%
• Sales: €8 bn
• Higher earnings
• Restructuring of AST and VDM
• Higher earnings • Achieve saving
targets of >€500 million
Focus
Targets
Going forward: Minimum target of ~€2 billion adjusted EBIT
Annual General Meeting January 30, 2015 14 Developing the future.
Successful Example of Integration: InCar®plus
Our specific know-how and expertise …
Customer-oriented solutions and new products
… and our open-minded collaborative project
approach
CT
40 new parts:
Lower weight
Lower fuel consumption
Lower CO2 emissions
Components Technology
Industrial Solutions
Steel Europe
Annual General Meeting January 30, 2015 15 Developing the future.
Successful Example of Integration: ACCEL and MULTI
Experience in moving walks and elevators…
Customer-focused solutions and new
products … and expertise in
linear motors
ACCEL
Elevator Technology
Components Technology
Tech Center Carbon
Composites
MULTI
Transrapid
Annual General Meeting January 30, 2015 16 Developing the future.
Key Integration Levers
Stronger customer
orientation
Regional organization
Cost synergies R&D spending IT infrastructure
& process harmonization
Prerequisite: Joint employee development and exchange and a corporate culture that promotes the ability to collaborate
Annual General Meeting January 30, 2015 17 Developing the future.
Outlook for FY 2014/15
Sales
“impact 2015”
Adjusted EBIT
Net income
Free Cash Flow (before
divestments)
Growth in single-digit percentage range
Cost reductions of €850 million Total volume raised to €2.5 billion
Increase to at least €1.5 billion
Clear positive net income
Clear progress towards at least break-even FCF
FY 2013/14
Outlook
FY 2014/15
~ €41.3 billion
~ €1.0 billion
~ €1.3 billion
€195 million
€(254) million
Key Indicators Comment
Annual General Meeting January 30, 2015 18 Developing the future.
Integrated company with profitable
growth
Sustainable Value Generation
Clear performance targets and continuous
improvement
Transformation
Financial stability and restructuring of the company
Stabilization
2014 2015 2016 2017 2018 2019 2020 2011 2012 2013
Our Way Forward
