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Seco Tools Group Q2-2009. Highlights Q2. Revenue growth was -40% in fixed currencies and -30% in SEK Stabilization on low level We continue to win market-share EBIT-margin for Q2 was 3,4% vs. 22,3% last year Margin decrease driven by the dramatic drop in volume Stable prices - PowerPoint PPT Presentation
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Investor Relations – 2009 Q2
Seco Tools GroupQ2-2009
Investor Relations – 2009 Q2
Highlights Q2
• Revenue growth was -40% in fixed currencies and -30% in SEK
• Stabilization on low level
• We continue to win market-share
• EBIT-margin for Q2 was 3,4% vs. 22,3% last year
• Margin decrease driven by the dramatic drop in volume
• Stable prices
• Savings and currency gains partly offsets volume decline
• Ongoing saving programs increased and ahead of time plan
• Initiated programs increased with 100 MSEK – annual savings now estimated to be around 600 MSEK whereof 500 will impact 2009
• Workforce reduction now estimated to be approx 850
• Q2 restructuring costs was 24 MSEK. Around 10 MSEK in additional restructuring costs for the already started programs are estimated for H2
• We stay the course!
• Maintain strategic direction
• Launches of several new competitive products - Square 6 released in Q2
• Uncertain 2009
• Stock reductions at end customers impact current demand situation
• No sign of a near upturn
Investor Relations – 2009 Q2
Growth Analysis Q2
CEE excl. ALG: -38%
Fixed currency - 41 %Acquisition + 1 %Currency +10 %
SEK total - 30 %
Seco Tools Group
I nvoicing in local currency
-43% -44%
-34%
-39%
-31%
-50%
-45%
-40%
-35%
-30%
-25%
-20%
-15%
-10%
-5%
0%
WesternEurope
NAFTA EasternEurope
Asia SouthAmerica
Investor Relations – 2009 Q2
Western Europe - Revenues(Fixed Currency)
0
200 000
400 000
600 000
800 000
1 000 000
1 200 0001
99
9
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
SE
K 0
00
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
% Y
-O-Y
Y-o-Y:2008 + 4%2009:Q1 - 30%Q2 - 43%2009 - 37%
Financial keydata
Investor Relations – 2009 Q2
Seco revenues in fixed currencies.Macro data up to 30/04/2009.
Financial keydata
EU12 Economic Indicators & Seco Western Europe 3M Average InvoicingY-o-Y % Change
Local Currencies
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Indic
ato
rs
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
Seco
Tools
EU12 Industrial Production EU12 Basic and Fabricated Metals
EU12 Machinery & Equipment
Investor Relations – 2009 Q2
NAFTA - Revenues(Fixed Currency)
0
50 000
100 000
150 000
200 000
250 000
300 000
350 000
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
SE
K 0
00
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
% Y
-O-Y
Y-o-Y:2008 + 3%2009:Q1 - 28%Q2 - 44%2009 - 36%
Financial keydata
Investor Relations – 2009 Q2
Seco revenues in fixed currencies.Macro data up to 31/05/2009.
Financial keydata
US Economic Indicators & Seco NAFTA 3M Average Invoicing
Y-o-Y % ChangeLocal Currencies
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Indic
ato
rs
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
Seco
Tools
US Industrial Production Primary metals Fabricated Metals Machinery
Investor Relations – 2009 Q2
Central and Eastern Europe - Revenues(Fixed Currency)
0
50 000
100 000
150 000
200 000
250 000
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
SE
K 0
00
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
% Y
-O-Y
Y-o-Y:2008 +17%2009:Q1 - 22%Q2 - 34%2009 - 28%
Financial keydata
YTD -33% excl ALG
Investor Relations – 2009 Q2
Asia - Revenues(Fixed Currency)
0
50 000
100 000
150 000
200 000
250 000
300 000
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
SE
K 0
00
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
% Y
-O-Y
Y-o-Y:2008 + 5%2009:Q1 - 28%Q2 - 31%2009 - 30%
Financial keydata
Investor Relations – 2009 Q2
Seco Tools Revenues, SEK M(Fixed currencies)
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Roll
ing 4
Q
0
500
1 000
1 500
2 000
2 500
Qu
art
er
Quarter 4Q Rolling
Financial keydata
Investor Relations – 2009 Q2
Seco Tools RevenuesYear-on-Year Change %
(Fixed currencies)
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Roll
ing 4
Q
Quarter 4Q rolling
Financial keydata
Investor Relations – 2009 Q2
The decline in historical perspective
Revenue fixed currency, quarterlyY-o-Y % Change
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Investor Relations – 2009 Q2
• Total savings
– In order to compensate for somewhat lower volumes larger savings activities have been initiated
– Annual cost level will be reduced by 600 MSEK (previously 500 MSEK) relating to both direct and fixed costs
– Impact on 2009 result is approx. 500 MSEK (previously 400 MSEK)
• Total workforce will be reduced by approx 900 people (previously 800), whereof approx 200 are staff. Reductions include time- and salary reductions corresponding to around 220 full time equivalents
Cost adjustment measures
Investor Relations – 2009 Q2
Personnel reduction plan
0
100
200
300
400
500
600
700
800
900
1000
2008-Q4 2009-Q1 2009-Q2 2009-Q3 2009-Q4
Workers Staff Temporaries *
* Not reported temporaries
• Reductions ahead of time plan• Total reductions approx 50 people higher
Investor Relations – 2009 Q2
Accumulated market growth- goal: 0,2 percentage unit per year
Target Seco
0,0%
0,2%
0,4%
0,6%
0,8%
1,0%
2005 2006 2007 2008 2009 2010
referens
We are taking market share!
Investor Relations – 2009 Q2
Square 6
•A new family of square shoulder milling products
•Six cutting edges per insert gives optimal economy without compromising performance
•Product very well received since launch in Q2
Investor Relations – 2009 Q2
– Customer intimacy and understanding the customer’s manufacturing process
– Solutions orientation
– High performance products and services
– Global competence and support structures
– Distributors
Customer Intimacy and Solution Orientation
Strategic Direction
We stay the course!
Investor Relations – 2009 Q2
Positioning for Growth
Number of employees
40% field sales and technicans close to customers 2005 till 2008
Capital expenditure(excl acquisitions)
0%
2%
4%
6%
8%
10%
12%
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
% o
f re
ven
ues
Time for payback and consolidation
Investor Relations – 2009 Q2
• Invoicing, SEK M 1,180 1,697
• EBIT margin 3,4% 22,3%
• EBIT, SEK M 40 378
• Earnings per share (SEK) 0,10 1,76
• ROCE (Roll 12 mths) 16,9% 38,2%
• Net debt / equity ratio 1,04 0,99
Q2-2009 Q2-2008
Financial keydata
Investor Relations – 2009 Q2
-200
-100
0
100
200
300
4002
00
8 Q
2
20
09
Q2
EB
IT (
MS
EK
)Result development Q2-2009
Rev. / EBIT
Rev. / EBIT
1 180 /
1 180 /
3,4%3,4%
Volu
me a
nd
oth
er
Restr
uctu
rin
g
Cu
rren
cy
Savin
gs
Investor Relations – 2009 Q2
Seco Tools Revenues and EBIT %(Fixed currencies)
0%
5%
10%
15%
20%
25%
30%
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
EB
IT %
0
500
1 000
1 500
2 000
2 500
REV
EN
UES
, S
EK
M
Revenues Q EBIT % EBIT % Rolling 4Q
Financial keydata
Financial target
Investor Relations – 2009 Q2
- Cash Flow higher than EBIT- Reduced level of working capital- Lower investment level
0
50
100
150
200
250
300
350
400
Q1
00
Q2
00
Q3
00
Q4
00
Q1
01
Q2
01
Q3
01
Q4
01
Q1
02
Q2
02
Q3
02
Q4
02
Q1
03
Q2
03
Q3
03
Q4
03
Q1
04
Q2
04
Q3
04
Q4
04
Q1
05
Q2
05
Q3
05
Q4
05
Q1
06
Q2
06
Q3
06
Q4
06
Q1
07
Q2
07
Q3
07
Q4
07
Q1
08
Q2
08
Q3
08
Q4
08
Q1
09
Q2
09
MS
EK
Operational CF EBIT
Operational Cash Flow
Operating cash flow includes changes in working capital but excludes acquisitions
Financial keydata
Investor Relations – 2009 Q2
Working Capital
0
500
1 000
1 500
2 000
2 500
3 000
9803
9809
9903
9909
0003
0009
0103
0109
0203
0209
0303
0309
0403
0409
0503
0509
0603
0609
0703
0709
0803
0809
0903
15%
20%
25%
30%
35%
40%
45%
Working capital (MSEK) Working capital (% roll 12 mths)
Financial keydata
Working capital includes trade receivables, inventories and trade payables
Investor Relations – 2009 Q2
Working Capital
15%
20%
25%
30%
35%
40%
45%
50%
55%
9803
9809
9903
9909
0003
0009
0103
0109
0203
0209
0303
0309
0403
0409
0503
0509
0603
0609
0703
0709
0803
0809
0903
15%
20%
25%
30%
35%
40%
45%
50%
Quarter Rolling
Financial keydata
Working capital includes trade receivables, inventories and trade payables
Investor Relations – 2009 Q2
Inventory
8%
11%
14%
17%
20%
23%
26%
29%
32%
35%
9803
9809
9903
9909
0003
0009
0103
0109
0203
0209
0303
0309
0403
0409
0503
0509
0603
0609
0703
0709
0803
0809
0903
8%
11%
14%
17%
20%
23%
26%
29%
32%
35%
Quarter Rolling
Financial keydata
Investor Relations – 2009 Q2
Trade Receivables
10%
12%
14%
16%
18%
20%
22%
24%
9803
9809
9903
9909
0003
0009
0103
0109
0203
0209
0303
0309
0403
0409
0503
0509
0603
0609
0703
0709
0803
0809
0903
10%
12%
14%
16%
18%
20%
22%
24%
Quarter Rolling
Financial keydata
Investor Relations – 2009 Q2
Shareholder Value4Q Rolling
0,00
1,00
2,00
3,00
4,00
5,00
6,00
7,00
8,00
2002
2003
2004
2005
2006
2007
2008
2009
0%
10%
20%
30%
40%
50%
60%
Return on Equity EPS
Financial keydata
Investor Relations – 2009 Q2