Drägerwerk AG & Co. KGaA Analysts' Meeting€¦ · reduction of expense/net sales ratio by 1%-point until 2014 Project Business, Accessories & Consumables and Services strengthen

ImageH 9.4 cm x W 27.53 cm

Drägerwerk AG & Co. KGaAAnalysts' Meeting

Frankfurt, March 12, 2013

Interim financial reports as well as preliminaries are not audited.

Disclaimer

This presentation contains forward-looking statements regarding the future development of the Dräger Group. These forward-looking statements are based on the current expectations, presumptions, and forecasts of the Executive Board as well as the information available to it to date, and have been made to the best of its knowledge and belief. No guarantee or liability for the occurrence of the future developments and results specified can be assumed in respect of such forward-looking statements. Rather, the future developments and results are dependent on a number of factors; they entail risks and uncertainties beyond our control and are based on assumptions which could prove to be incorrect. Notwithstanding any legal requirements to adjust forecasts, we assume no obligation to update the forward-looking statements contained in this presentation.

This presentation does not constitute an offer of securities for sale or a solicitation of an offer to purchase any securities. No money, securities or other consideration is being solicited by this presentation.

Analysts' Meeting | 12.03.20132

Diversity at Dräger

3 Analysts' Meeting | 12.03.2013





Highlights Dräger Employee Stock Ownership

� Dräger will implement an employee stock ownership program to increase motivation and identification with the company. At the same time increase awareness and responsibility for a positive development of Dräger.

� Starting in Germany, employees will have the opportunity to receive one bonus share for each three purchased preference shares.

– Employees can purchase up to nine share packages of three shares each, a total of 27 shares.

– There will be a lock-up period of two years.

– Dräger does not distinguish between different employee groups. Apprentices can invest the same amount as top managers.

� It is intended to offer this program in at least 5 countries by 2015.


� Stationary + portable gas detection systems

� Breathing air supply systems

� SCBA� Escape devices and

chambers� Services including FRS

escape shelterconfined space entry work

hazmat handling

FRS total care service on site

� Hospital Gas Management

� Workplace Infrastructure� Anesthesia� Respiratory Care � Warming Therapy

Devices� Patient Data

Management

Today’s offering

Today’s offering

GDS

Fire fightingequipment


Highlights 2012New Marketing Approach - Examples for Segments

� broadening product portfolio

� supporting customer work flows with new offerings (e.g. IT-integration)

� integration of 3rd

party products

� providing concepts and consulting

� offering rental and financing solutions

Possible futurepotential for Dräger

Complete Solution Provider

Oil & Gas

Hospital – Operating Room

7

Oil &Gas

Chemical Mining FireServices

IC OR NC HWS

Hospital*

Customers that use Dräger products along-side large parts of their value chain

Solution offerings involving various Dräger’sproduct areas alongside the customers value chain

Manage R&D process and product portfolio to increase customer satisfaction along value chain

Impair-ment

Diving Steel Shipping

Customers that only use Dräger products in individual or low-attention applications

Increase market penetration via new sales channels and marketing approaches

Improve capitalization of R&D investment Leverage existing product portfolio

more than200 others

Highlights 2012Implementation of new Marketing Approach

…


* OR = Operating Room, IC = Intensive Care, NC = Neonatal Care, HWS = Hospital wide solutions

Focused Market Segments Application Driven Markets

Complete Solution Provider Best of Breed Provider

8

Highlights 2012Sales & Service

Developing our business mechanics

� Project business gaining importance and organizational focus

� Above average growth of Service & Consumables business

Improving global coverage and streamlining organization and

infrastructure to achieve reduction of expense/net sales ratio by 1%-point

until 2014

Project Business, Accessories &

Consumables and Services strengthen solution

offerings towards our customers

Positive effects on Sales and Dräger brand

Reorganization of Sales & Service function

� One Global Head of Sales & Service. Board members taking cross-functional responsibility for a region on the board level.

� One Regional Head of Sales & Service for each of the seven regions; also responsible for the co-ordination of the regional cross-functional management team

� One Country Manager for each country

Professionalizing internal and external trainings through set up of “Dräger Academy”


Highlights 2012New Products and Projects - Examples


Perseus A500Tunnel Rescue TrainMerlin Tablet PC

10


Net Sales (in EUR m)

866.4 864.7

2011 2012 * constant currency

-1.2%*

Europe South

-4.8%

Dräger – Robustness against crises

� Europe South: France, Spain, Italy, Portugal, Greece, Turkey,…(Net Sales – 4.8%)

� Basis for the small decline in sales 2012, are the wide range of business mechanics� Direct sale, products, systems� Consumables� Service spare parts� Advanced service features

and the wide range of product portfolio at Dräger.

Dräger – Robustness against crises

� Europe South: France, Spain, Italy, Portugal, Greece, Turkey,…(Net Sales – 4.8%)

� Basis for the small decline in sales 2012, are the wide range of business mechanics� Direct sale, products, systems� Consumables� Service spare parts� Advanced service features

and the wide range of product portfolio at Dräger.

Highlights Europe South

12

Initiative Achievements 2012

Innovations 2012

New products in 2012

� 15 new products and system solutions for the hospital / Medical Division

� 14 new products and integration solutions for Safety Division

Reduce time to market

� Measures initiated to reduce time to market in 2010-2011, enabled a reduction of project duration of 2.2 month in 2012. Measures are sustainable.

Protecting intellectual property

� Dräger registered 122 patents continuing the trend of protecting intellectual property within Dräger. Energetic measures started in China. Expansion of development sites

in Emerging Countries

2013 and following years


13

Initiative Achievements 2012

Strategic InitiativesPurchasing – Supplier Quality

Integration of Strategic Suppliers

2012

Savings*: 1,1 % of Sales

Reduction Suppliers: 265

Quality Improvement: + 10,2 %

*) Saving volume includes price changes vs. previous year and cost avoidance

Implementing the Purchasing Strategy

Strategy developed and execution of the Dräger supplier portfolio:

� Consolidate supplier base� Built stronger partnership with

strategic suppliers� Develope global sourcing further

Enhancing staff in purchasing and supplier-QM



� Strong growth in Saudi Arabia including large Medical and Safety equipment and consumables orders for MOH and MOI

� Strengthen distribution channels in MEA (e.g. Draeger Maroc SARL AU, Olive Group as Draeger partner in Iraq)

� Expanding project / solutions business in MEA and AP (Shutdown & Rental in Bahrain, Fire Training Simulator in Australia)

� Laying of the foundation stone for the new production plant in Shanghai

� Strong growth in Saudi Arabia including large Medical and Safety equipment and consumables orders for MOH and MOI

� Strengthen distribution channels in MEA (e.g. Draeger Maroc SARL AU, Olive Group as Draeger partner in Iraq)

� Expanding project / solutions business in MEA and AP (Shutdown & Rental in Bahrain, Fire Training Simulator in Australia)

� Laying of the foundation stone for the new production plant in Shanghai

Asia Pacific Others


346.1404.1

145.3181.2


+8.4%*

+24.1%*

Highlights Regions Asia / Pacific and Middle East / Africa

14

Shaping the futureOperations

Initiatives Achievements Effects

� Design Global Footprint

� Transfer of labor-intensive products from Lübeck to Chomutov decided

� Transfer of manufacturing from Bern to Shanghai and Lübeck started

� Ground breaking ceremony for building extension in Shanghai

� Optimize Value Chain

� Pilot project for optimizing local value add activities in France started

� Distribution network optimized further(e.g. spare parts, Mexico)

� Global Organization & Processes

� Regional Operations organization introduced� SCOR model implemented and common

process landscape defined

� Leverage potential in growing markets

� Fulfill country-specific customer requirements

� Increase efficiency


Shaping the futureIT Organization & Processes

Initiatives Achievements Effects

� Implementation of a global ERP template DW1

� ERP relevant business processes, especially order fulfillment process harmonized

� Global roll-out planned

� Organizational development

� Global IT and process experts merged to a joint organization

� Harmonization & Consolidation of Infrastructure

� More than 50% of all end user devices renewed

� Productivity improvement for all users

� Complexity reduction through standardization

� Increased transparency



Highlights Region America

� New Headquarter for Central-/South-America in Panama City

� Start of sale of IP product range in the US under Dräger brand name

� Minimal downtime of production after hurricane Sandy

� Strong growth in South America despite difficult business environment due to political events

� Good market acceptance in the US of last years launched V500 and VN 500

� New Headquarter for Central-/South-America in Panama City

� Start of sale of IP product range in the US under Dräger brand name

� Minimal downtime of production after hurricane Sandy

� Strong growth in South America despite difficult business environment due to political events

� Good market acceptance in the US of last years launched V500 and VN 500

America


440.3 461.0


-0.4%*

America

438.4 457.3

-0.7%*

NOE (in EUR m)

17

2,373.549.2 %

+5.2726.948.3 %

110.5 295.3

483.0Orders on hand

Order intake

+11.2149.7134.6DVA

Net Profit 135.0

229.69.7 %

92.312.7 %

636.7

€ million

Change

+7.4213.89.5 %

EBITEBIT margin

-33.231.2 %

-33.030.8 %

Interest ResultTax rate

+4.92,405.52,293.2

€ million€ million

Q4 2011

74.110.6 %

613.5

€ million

Change

+24.5

+3.8

% %

+8.0125.1

Q4 2012 2011 2012

1

1

1

1

after interest &income taxes

+0.5

+4.7461.3 1

EBITDA +7.5274.691.5 +20.7

Net salesGross margin

698.547.6 %

+4.1 2,255.849.1 %

1 Currency adjusted: Q4 2012: order intake +2.2%, net sales +2.7%2012: order intake +2.2%, orders on hand +5.0%, net sales +2.5%

Business development


135.2

185.111.9 %

85.817.4 %

Orders on hand 310.5

Business developmentMedical division

92.9

€ million

Change2012

-3.5191.812.9 %

EBITEBIT margin

-2.5211.6217.2 EBITDA

+5.0 1,558.01,484.5Net sales

+2.61,558.41,518.8Order intake


84.017.3 %

91.2

486.3

421.3

494.7

432.9

€ million

Change

+2.2

+1.8

+1.7

+2.7

% %1

2011Q4 2012Q4 2011

1

1

-2.9319.8

144.0 DVA

1 Currency adjusted: Q4 2012: order intake +1.1%, net sales +0.4% 2012: order intake 0.0%, orders on hand -2.4%, net sales +2.3%

-6.1

1

1


Orders on hand 173.7

Business developmentSafety division

29.012.0 %

35.7

€ million

Change2012

+27.797.111.4 %

76.19.5 %

EBITEBIT margin

+21.9122.0100.1 EBITDA

+5.8 849.3802.7Net sales

+9.4880.8805.0Order intake


9.44.2%

16.0

221.4

200.2

241.6

212.7

€ million

Change

+209.0

+123,2

+9.1

+6.2

% %

2011Q4 2012Q4 2011

1

+21.7142.8

78.957.5 DVA

1 Currency adjusted: Q4 2012: order intake +4.6%, net sales +7.6% 2012: order intake +6.8%, orders on hand +21.5%, net sales +3.2%

+37.3

1

1

1

1

Analysts' Meeting | 12.03.201320|

Key figures

78.1

€ million

Change20122011

+11.4404.1Net working capital1

+2.4898.425.6 %

Capital employed1

ROCE2

+0.278.2Investments

-19.4 332.4Cash and cash equivalents1

+9.3176.8Cash flow from operating activities

%€ million

362.8

877.124.4 %

412.3

161.7

+42.756.80.2

Net financial debt1

Net financial debt1/EBITDA239.8

0.1

7.637.69

EPS common sharesEPS preferred shares

7.297.35

+4.7+4.7

1 Values at due date2 EBITDA and accordingly EBIT of the last twelve monthsAnalysts' Meeting | 12.03.201321

5.815.87

EPS common shares on full distribution

EPS preferred shares on full distribution

4.544.60

+28.1+27.7

€ million

ChangeQ4 2012Q4 2011

%€ million

+15.552.3

7.2 %

45.3

6.5 %

-1.3157.6

21.7 %

159.6

22.9 %

-11.743.4

6.0 %

49.1

7.0 %

€ million

Change20122011

%€ million

+22.9197.3

8.3 %

160.5

7.1 %

+3.6595.8

25.1 %

575.3

25.5 %

-6.2140.2

5.9 %

149.5

6.6 %

Marketing and selling expenses

in % of net sales

Functional expenses

General administrative expenses

in % of net sales

Research and development costs

in % of net sales


2,101.2

1,389.8

Consolidated balance sheet

€ million

Change31 Dec 201231 Dec 2011Assets

-2.51,425.0Current assets

+6.6

+2.3

+9.7

-19.4

362.9

600.3

94.2

332.4

340.3

586.5

85.9

412.3

Inventories

Trade receivables

Other current assets

Cash and cash equivalents

+3.1711.5690.2Non-current assets

+0.8

+1.8

+10.3

282.6

278.4

150.5

280.3

273.4

136.5

Intangible assets

Property, plant and equipment

Other non-current assets

%€ million

-0.72,115.2Total assets


Consolidated balance sheet

€ million

Change31 Dec 201231 Dec 2011Equity and liabilities

+3.1758.3735.2Current liabilities

-1.6

+23.4

-1.7

+3.9

224.6

104.3

169.2

260.3

228.2

84.5

172.1

250.4

-5.3615.7650.4Non-current liabilities

-38.4

+28.1

-22.5

+12.3

19.2

229.8

282.9

83.8

31.2

179.4

365.3

74.6

Liabilities from participation certificates

Provisions for pensions and similar obligations

Non-current interest-bearing loans

Other non-current liabilities

-0.3727.2729.6Equity

%€ million

-0.72,101.22,115.2Total equity and liabilities

Current provisions

Current loans and liabilities to banks

Trade payables

Other current liabilities

1 Adjusted values


Operatingactivities

Investingactivities

Financingactivities

Change incash1

Cash flow statement

20122011 21 Without effects of exchange rates on cash and cash equivalents

2 adjusted values

-300

-250

-200

-150

-100

-50

0

50

100

150

200

250

300

176.8161.7

-67.4 -65.5

-4.6

-192.0

89.7

-80.7


Gross payout ratio

3.3

131.7

15.1 %

19.9

5.8

8.7

5.3

Dividend

€ million

31 Dec 2012

135.0Net profit

Dividend proposal 2012

Net payout ratio

- Preferred shares

- Common shares

- Participation certificates 1

2.8

122.3

3.3 %

4.1

1.2

1.3

1.6

€ million

31 Dec 2011

125.1

Earnings attributable to non-controlling interests

2.3Plus minimum dividend and tax effect of the participation certificates 1.1

16.9 %4.3 %

1 Without minimum dividend, after taxes

Net profit after earnings attributable to non-controlling interests


Net sales

EBIT margin

2012 2013

CAGR > 4 % 2.0 % - 4.0 %

8.0 % - 10.0 %

Outlook and mid-term perspective

+5.2 %(currency adjusted

+2.5 %)

9.7 %

Midterm2018

10.0 % - 12.0 %

Gross Margin 48.5 % - 49.5 % 49.2 %

Cash flow conversion

70 % - 85 % of EBIT

77 % of EBIT

Equity ratio 35 % – 38 % 34.6 %



Levers for achieving midterm targets

Net Sales growing

> 4 %

EBIT Margin improvement to 10.0 % – 12.0 %

� Over-proportional growth in service- and consumables business

� Continued investment in R&D offers potential for more profitable products

� Synergies through new global Sales & Service organization

� Continued optimization of Dräger’s supply chain

� Implementation of new ERP System supports steering of business

� Continued investment in R&D offers potential to grow market share

� Over-proportional growth in Emerging markets

� New Marketing organization provides potential to increase penetration of existing markets and expand currently accessible markets

� Implementation of new CRM System supports Sales

28



30

Appendix

Stefan DrägerCEO

Dr. Herbert FehreckeCTO

Gert-Hartwig Lescow CFO

Toni Schrofner COO

Executive Board

Executive Board of Drägerwerk Verwaltungs AG


Shareholder structure

ShareholdingCommon shares

67.2 %

28.6 %

4.2 %

Dr. Heinrich Dräger GmbH

Free float

Members of the Dräger family

10,160,000 common shares (28.6 % free float)6,350,000 preferred shares (100.0 % free float)

ShareholdingDr. Heinrich Dräger GmbH

Stefan Dräger GmbH

Dräger Foundation

Successors of Dr. Heinrich Dräger

58.7 %

23.2 %

18.1 %


March 12, 2012 Accounts press conference, Hamburg Analysts’ meeting, Frankfurt

May 2, 2012 Report for the first three months 2013 Conference call, Lübeck

May 3, 2012 Annual shareholders’ meeting, Lübeck

August 1, 2012 Report for the first six months 2013 Conference call, Lübeck

October 31, 2012 Report for the first nine months 2013 Conference call, Lübeck

Financial calendar


Melanie Kamann Thomas FischlerCorporate Communications Investor Relations

Drägerwerk AG & Co. KGaA Drägerwerk AG & Co. KGaAMoislinger Allee 53−55 Moislinger Allee 53−5523558 Lübeck, Germany 23558 Lübeck, Germany

Tel +49 451 882-3998 Tel +49 451 882-2685 Fax +49 451 882-3944 Fax +49 451 882-3296

Mobile +49 170 8558152 Mobile +49 151 12245295

[email protected] [email protected] www.draeger.com

Contact


Documents

Drägerwerk AG & Co. KGaA Analysts' Meeting€¦ · reduction of expense/net sales ratio by 1%-point until 2014 Project Business, Accessories & Consumables and Services strengthen