Investor Presentation Q3 CY19 Results Mahindra CIE Automotive Limited 23 rd October 2019 │ Mumbai 1
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MCIE India Q3 CY2019 Results Market Update (Production) Financial Update Jul-Sep 2019 Jul-Sep 2019 v/s v/s Jul-Sep 2018 Apr-Jun 2019 (INR Mio) Jul-Sep Change Jul-Sep Apr-Jun PV -23.8% -3.6% 2019 2018 2019 Source: SIAM, TMA UV -6.0% -4.4% Sales 8,509 +4% 8,153 9,179 (without Excise) LCV -26.0% -11.1% EBITDA (*) 1,111 -10% 1,240 1,214 <6T -20.6% -4.9% EBITDA% 13.1% 15.2% 13.2% Two Wheelers -14.9% 0.6% EBIT (*) 678 -27% 934 795 Tractors -2.5% 21.7% EBIT % 8.0% 11.5% 8.7% # M&M, Maruti, Tata Motors, Hero MotoCorp and Bajaj combined constitute more than 50% of MCIE India business. Production Numbers for: M&M includes EBT 566 -44% 1,006 774 PV+UV+LCV+Tractors but excludes 2wheelers and 3Wheelers, Maruti includes PV+LCV, Tata Motors includes PV+UV+LCV but excludes MHCV, Hero all 2Wheelers EBT% 6.7% 12.3% 8.4% and Bajaj includes 2Wheelers and 3 Wheelers. The growth of MCIE’s Key customers (not including Bajaj) weighted as per their share of business in MCIE India for Jul-Sep 2019 growth is -19.5% and sequential growth is -3.1%. (*) EBITDA: Net Operating Income + Depreciation , EBIT: Net Operating Income. Sales growth due to AEL integration. Organic sales drop around 20% ▪ ▪ EBITDA margin recovery plan on going. Maintaining Q2 margins despite 7% sequential sales drop (Q3.2019 vs Q2.2019) ▪ Forex loss INR 41 mio in this contributed to the drop in EBT. Q3 C18 included a forex gain of INR 89 mio. Without Forex EBT drop would be in line with EBIT drop ▪ Cost reduction plan to adjust to current sales level and active commercial search for short term new sales 3
MCIE India 9M CY2019 Results Financial Update Market Update (Production) (INR Mio) Jan-Sep 2019 Change Jan-Sep 2018 Jan-Sep 2019 v/s Jan-Sep 2018 Source: SIAM, TMA Sales 25,529 +7% 23,934 PV -15.5% (without Excise) UV -2.9% EBITDA (*) 3,622 -1% 3,671 LCV -11.8% <6T -11.8% EBITDA% 14.2% 15.3% Two Wheelers -11.7% EBIT (*) 2,466 -11% 2,766 Tractors -8.8% EBIT % 9.7% 11.6% # M&M, Maruti, Tata Motors, Hero MotoCorp and Bajaj combined constitute more than 50% of MCIE India business. Production Numbers for: M&M includes EBT 2,330 -17% 2,815 PV+UV+LCV+Tractors but excludes 2wheelers and 3Wheelers, Maruti includes PV+LCV, Tata Motors includes PV+UV+LCV but excludes MHCV, Hero all 2Wheelers and Bajaj includes 2Wheelers and 3 Wheelers. The growth of MCIE’s EBT% 9.1% 11.8% Key customers (not including Bajaj) weighted as per their share of business in MCIE India for the Jan-Sep 2019 growth is -12.7%. (*) EBITDA: Net Operating Income + Depreciation, EBIT: EBT + financial results. Accumulated sales growth due to AEL integration. Organic sales drop around 8% ▪ ▪ YTD forex gain is at INR 37 mio v/s previous year gain of INR 127 mio ▪ EBITDA margin slightly reduced to 14.2% due to AEL lower margin (12%) and sales drop impact specially in the last quarter 4
MCIE Europe Q3 CY2019 Results Financial Update Market Update (Production) (INR Mio) Jul-Sep Change Jul-Sep Apr-Jun 2019 2018 2019 Source: IHS Global Jul-Sep 2019 Jul-Sep 2019 Sales 9,340 -17% 11,263 11,316 v/s v/s (without Excise) Jul-Sep 2018 Apr-Jun 2019 EBITDA (*) 1,074 -22% 1,369 1,480 Passenger 0.3% -16.9% EBITDA% 11.5% 12.2% 13.1% Vehicles As per ACEA registrations data, t he HCV (>16T) segment in EBIT (*) 718 -27% 984 1,055 Europe dropped in July (-25.1%) and August (-21.8%) while the MHCV (>3.5T) segment in Europe dropped in August (-19.0%) EBIT % 7.7% 8.7% 9.3% EBT 632 -26% 850 961 EBT% 6.8% 7.5% 8.5% (*) EBITDA: Net Operating Income + Depreciation , EBIT: Net Operating Income Negative exchange rate impact of -3,5% in sales (real drop in Euros -13,5%) ▪ ▪ Pass car Forgings and Gears, Italy maintaining the good performance ▪ Main sales drop in CV Forgings (-20% vs Q3.2018). We are working on a plan to realign the operations to the new market situation 5
MCIE Europe 9M CY2019 Results Financial Update Market Update (Production) (INR Mio) Jan-Sep 2019 Change Jan-Sep 2018 Source: IHS Global Jan-Sep 2019 Sales 33,500 -2% 34,085 v/s (without Excise) Jan-Sep 2018 EBITDA (*) 4,232 -6% 4,479 Passenger Vehicles -4.2% EBITDA% 12.6% 13.1% As per ACEA registrations data, the HCV (>16T) segment in EBIT (*) 3,014 -7% 3,254 Europe grew by 7.7% YTD August and the MHCV (>3.5T) segment in Europe grew by 8% YTD August EBIT % 9.0% 9.5% EBT 2,734 -6% 2,894 EBT% 8.2% 8.5% (*) EBITDA: Net Operating Income + Depreciation, EBIT: EBT + financial results. ▪ 2% sales drop due to exchange rate impact. Real sales in euros flat thanks to the positive first quarter. Margin reduction due to CV Forgings. Pass car forgings and Gears, Italy maintaining margins ▪ 6
MCIE Consolidated Q3 CY2019 Results (INR Mio) Jul-Sep 2019 Change Jul-Sep 2018 Apr-Jun 2019 Sales 17,850 -8% 19,326 20,495 (without Excise) EBITDA (*) 2,186 -16% 2,610 2,694 EBITDA% 12.2% 13.5% 13.1% EBIT (*) 1,396 -27% 2,918 1,850 EBIT % 7.8% 9.9% 9.0% EBT 1,198 -35% 1,856 1,735 EBT% 6.7% 9.6% 8.5% (*) EBITDA: Net Operating Income + Depreciation , EBIT: Net Operating Income ▪ Weak third quarter sales and result, due to negative market evolution ▪ EBT drop accentuated by the Forex impact in India (explained earlier) EBITDA assurance plan launched in all divisions, to improve internal efficiency and control costs ▪ 7
MCIE Consolidated 9M CY2019 Results (INR Mio) Jan-Sep 2019 Change Jan-Sep 2018 Sales 59,028 +2% 57,753 (without Excise) EBITDA (*) 7,853 -4% 8,150 EBITDA% 13.3% 14.1% EBIT (*) 5,480 -9% 6,020 EBIT % 9.3% 10.4% EBT 5,063 -11% 5,709 EBT% 8.6% 9.9% (*) EBITDA: Net Operating Income + Depreciation, EBIT: EBT + financial results. ▪ Accumulated sales growth due to AEL integration. Organic sales drop is 5% 9M CY2019 EBITDA margin affected by AEL integration ▪ 8
Other Details Other Operating Revenue, Other Income and Exchange rates For Q3 CY19 For 9M CY19 (INR Mio) India Europe Consolidated India Europe Consolidated 625 221 836 Other Operating Revenue 1701 1119 2,820 25 16 41 207 60 267 Other Income Exchange Rates Period INR/ Euro Average for Q3 CY19 78.42 Average for Q3 CY18 81.19 Average for 9M CY19 78.89 Average for 9M CY18 80.23 9
Annexure 1: - Results Declared to SEBI 10
STATEMENT OF PROFIT & LOSS ACCOUNTS - Consolidated Rs. in Million Consolidated Quarter Ended Nine Months Ended Year Ended September September September September June 30, 2019 December 31, 2018 Particulars 30, 2019 30, 2018 30, 2019 30, 2018 Unaudited Unaudited (Refer Note 10) Unaudited (Refer Note 10) Audited Continuing Operations I Revenue from operations 18,685 21,420 19,811 61,849 60,565 80,315 II Other Income 42 78 67 268 205 387 III Total Revenue (I+II) 18,727 21,498 19,878 62,117 60,770 80,702 IV Expenses a) Cost of materials consumed 8,568 10,206 9,028 28,949 28,146 37,737 b) Changes in stock of finished goods and work-in progress 577 (141) 262 405 (457) (1,421) c) Employee benefit expense 3,039 3,648 3,080 10,246 9,914 13,297 d) Finance costs 198 115 42 417 311 502 e) Depreciation and amortisation expenses 789 844 675 2,373 2,130 2,867 f) Other expenses 4,409 5,091 4,906 14,714 15,017 20,192 Total Expenses (IV) 17,580 19,763 17,992 57,104 55,061 73,173 V Profit before exceptional items and tax (III-IV) 1,147 1,734 1,885 5,012 5,709 7,529 VI Exceptional items (Refer Note 4) (51) - - (51) - - VII Profit before tax (V-VI) 1,198 1,734 1,885 5,063 5,709 7,529 11
STATEMENT OF PROFIT & LOSS ACCOUNTS - Consolidated Contnd. Rs. in Million Consolidated Quarter Ended Nine Months Ended Year Ended September September September September June 30, 2019 December 31, 2018 Particulars 30, 2019 30, 2018 30, 2019 30, 2018 Unaudited Unaudited (Refer Note 10) Unaudited (Refer Note 10) Audited Continuing Operations VII Profit before tax (V-VI) 1,198 1,734 1,885 5,063 5,709 7,529 VIII Tax expense (Refer Note 11) 1) Current tax 522 456 521 1,581 1,588 1,934 2) (Excess)/short provision for tax of earlier years - - - - - (35) 3) Deferred tax 65 17 6 71 55 144 Total tax expense (VIII) 586 472 527 1,652 1,644 2,043 IX Profit after tax (VII-VIII) 612 1,262 1,359 3,412 4,065 5,485 Discontinued Operation (Refer Note 2) Profit / (Loss) for the period for discontinued Operations - - (443) (13) (473) (504) Tax Expense for Discontinued Operations - - - - - - Profit after tax (Continuing and Discontinued operations) 612 1,262 916 3,399 3,593 4,981 12
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