Transcript Atlas Copco Group

Atlas Copco Group
Q2 Results
July 18, 2005
July 18, 2005
www.atlascopco.com
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Contents
 Q2 Business Highlights
 Market Development
 Business Areas
 Financials
 Outlook
July 18, 2005
www.atlascopco.com
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Q2 - Highlights
 Customer demand remained favorable
 Very strong performance by all business areas
– Record sales
– Record profits
 Increased sales and marketing activities
 Important orders received for new applications
and in focused markets
July 18, 2005
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Q2 - Figures in summary
 Order received up 24%
 Revenues reached MSEK 13 062 (10 680), up 22%
 Operating profit at MSEK 2 292, a margin of 17.5% (14.8)
 Profit after financial items up 42% to MSEK 2 128 (1 502)
 Earnings per share increased to SEK 2.32 (1.76)
– Capital gain on professional electric tools divestment not
included. Final closing balance will be decided in arbitration
 Operating cash flow at MSEK 955 (774)
 ROCE at 25%
July 18, 2005
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Contents
 Q2 Business Highlights
 Market Development
 Business Areas
 Financials
 Outlook
July 18, 2005
www.atlascopco.com
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Orders received - Local currency
June
2005
Group total +22% YTD, +23% last 3 months
(Structural change +10% YTD, +10% last 3 months)
35
37
+26
+14
+18
+25
13
6
5
+58
+30
+18
+22
+33
+42
4
A
July 18, 2005
B
C
+34
A= Portion of Group sales last 12 months, %
B= Year-to-date vs prev. year, %
C= Last 3 months vs prev. year, %
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+28
Q2 - The Americas
June
2005
 Continued strong demand in North America
– Increased demand from manufacturing and
process industries
– Non-residential construction activity improved
– Very good demand from the mining industry
 Strong demand across the continent in South
America
A
July 18, 2005
B
C
37
+26
+25
5
+58
A= Portion of Group sales last 12 months, %
B= Year-to-date vs prev. year, %
C= Last 3 months vs prev. year, %
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+42
Q2 - Europe and Africa/Middle East
June
2005
 Favorable demand in Europe
– Continued growth in sales of compressed air
equipment and industrial tools to the
manufacturing and process industries
– Good development for mining and construction
equipment, primarily in Eastern Europe and in
the Nordic countries
– Large orders for liquified natural gas application
35
+14
6
+30
 Overall positive demand development in Africa /
Middle East
A
July 18, 2005
B
C
A= Portion of Group sales last 12 months, %
B= Year-to-date vs prev. year, %
C= Last 3 months vs prev. year, %
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+18
+33
Q2 - Asia and Australia
June
2005
 Improved demand in Asia
– Strong growth in Japan, India and
South East Asia
– Important orders from the motor
vehicle industry in Japan
– Orders in China stabilized
13
+18
+22
 Continued good demand in Australia
4
A
July 18, 2005
B
C
+34
A= Portion of Group sales last 12 months, %
B= Year-to-date vs prev. year, %
C= Last 3 months vs prev. year, %
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+28
Volume Growth
per Quarter
20
15
10
5
0
-5

July 18, 2005
05 Q2
05 Q1
04 Q4
04 Q3
04 Q2
04 Q1
03 Q4
03 Q3
03 Q2
03 Q1
02 Q4
02 Q3
02 Q2
02 Q1
01 Q4
01 Q3
01 Q2
01 Q1
00 Q4
00 Q3
00 Q2
00 Q1
-10
Change in orders received in % vs. same Quarter previous year
www.atlascopco.com
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Group Total
Sales Bridge
April – June
MSEK
2004 reported
Discontinued operations
2004
Structural change, %
Currency, %
Price, %
Volume, %
Total, %
2005
July 18, 2005
Orders
Received
12 599
-1 398
Revenues
11 201
+10
0
+3
+11
+24
13 838
10 680
+9
0
+3
+10
+22
13 062
www.atlascopco.com
12 079
-1 399
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Contents
 Q2 Business Highlights
 Market Development
 Business Areas
 Financials
 Outlook
July 18, 2005
www.atlascopco.com
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Compressor Technique
 Record order intake and revenues
– Volume growth 10%
– Continued strong sales development in the
Americas
– Major product launch and steady growth for
stationary industrial compressors and
aftermarket business
– Significant growth for portable compressors and
specialty rental business
– Large orders for gas- and process compressors
 Record profits
– Operating margin 18.5%
July 18, 2005
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Compressor Technique
Volume growth: Change in revenues vs. same quarter previous year, %
Quarterly operating margin, %

July 18, 2005
05 Q2
05 Q1
04 Q4
04 Q3
04 Q2
04 Q1
03 Q4
-15
03 Q3
-15
03 Q2
-10
03 Q1
-10
02 Q4
-5
02 Q3
-5
02 Q2
0
02 Q1
0
01 Q4
5
01 Q3
5
01 Q2
10
01 Q1
10
00 Q4
15
00 Q3
15
00 Q2
20
00 Q1
20
Operating margins restated (IFRS) from 2004
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Construction & Mining Technique
 Continued strong demand from the mining
industry and improvement in construction
 Orders received up 64%
– 13th consecutive quarter with volume growth
– Strong volume growth for comparable units
and in acquired businesses
– Acquisitions have improved the geographical
balance of sales
 Investment of MSEK 40 to extend assembly
plant in Örebro, Sweden
 The worlds most productive drill rig in operation
 Record revenues and profits
July 18, 2005
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Construction & Mining Technique
Volume growth: Change in revenues vs. same quarter previous year, %
Quarterly operating margin, %
25
25

July 18, 2005
05 Q2
05 Q1
04 Q4
04 Q3
04 Q2
-20
04 Q1
-20
03 Q4
-15
03 Q3
-15
03 Q2
-10
03 Q1
-10
02 Q4
-5
02 Q3
-5
02 Q2
0
02 Q1
0
01 Q4
5
01 Q3
5
01 Q2
10
01 Q1
10
00 Q4
15
00 Q3
15
00 Q2
20
00 Q1
20
Operating margins restated (IFRS) from 2004
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Rental Service
 Non-residential construction activity improved
 Rental revenues increased 14% in USD
– Price +9%, volume +5%
 Fleet utilization at record level
– Improved fleet quality, average age 2.8 years
 Profitability improved significantly
– All-time high operating profit margin
– Return on operating capital at 23%
July 18, 2005
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Rental Service
Rental Revenue Volume Development
Volume growth: Change in rental revenue vs. same quarter previous year, %
Quarterly operating margin, % (Business Area)

July 18, 2005
05 Q2
05 Q1
04 Q4
04 Q3
04 Q2
04 Q1
03 Q4
-15
03 Q3
-15
03 Q2
-10
03 Q1
-10
02 Q4
-5
02 Q3
-5
02 Q2
0
02 Q1
0
01 Q4
5
01 Q3
5
01 Q2
10
01 Q1
10
00 Q4
15
00 Q3
15
00 Q2
20
00 Q1
20
Operating margins restated (IFRS) from 2004
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Industrial Technique
 Order volume up 10%
– Good demand from all major customer
segments
– Solid development in North and South
America, moderate in Europe and strong
in the rest of the world
– Important new orders for sophisticated
fastening tools in Japan
 High pace of new product launches
 Significantly improved operating margin
July 18, 2005
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Industrial Technique
Volume growth: Change in revenues vs. same quarter previous year, %
Quarterly operating margin, %
-5
-5
-10
-10
-15
-15

July 18, 2005
05 Q2
0
05 Q1
0
04 Q4
5
04 Q3
5
04 Q2
10
04 Q1
10
03 Q4
15
03 Q3
15
03 Q2
20
03 Q1
20
Operating margins restated (IFRS) from 2004
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Contents
 Q2 Business Highlights
 Market Development
 Business Areas
 Financials
 Outlook
July 18, 2005
www.atlascopco.com
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Income Statement
MSEK
April – June
2004
2005
13 838 11 201
13 062 10 680
1 584
2 292
14.8
17.5
1 502
2 128
14.1
16.3
1 046
1 461
66
1 112
1 461
1)
2.32 1.76
33
34
1)
25
%
+24
+22
+45
January – June
2004
2005
25 828
Orders received
24 230
Revenues
4 029
Operating profit
16.6
– as a percentage of revenues
+42
3 793
Profit after financial items
15.7
– as a percentage of revenues
+40
2 628
Net profit from continuing operations
Net profit from discontinued operations
+31
2 628
Net profit
2)
+32
4.17
Earnings per share, SEK
2)
Equity capital per share, SEK
Return on capital employed, %
1)
Including discontinued operations.
2)
Earnings per share and equity capital per share are adjusted for share split.
July 18, 2005
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21 478
20 275
2 905
14.3
2 733
13.5
1 921
113
2 034
1)
3.22
22
%
+20
+20
+39
+39
+37
+29
+30
Balance Sheet
MSEK
Property, plant and equipment
Rental equipment
Other property, plant and equipment
Intangible assets
Other fixed assets
Inventories
Receivables
Short-term investments
Cash and cash equivalents
Assets held for sale
Total assets
Total Equity
Interest-bearing loans and borrowings
Non-interest-bearing loans and borrowings
Liabilities held for sale
Total shareholders’ equity and liabilities
July 18, 2005
June 30 2005
Dec. 31 2004
June 30 2004
11 973
4 179
10 174
1 893
7 050
12 647
398
3 174
0
51 488
23%
8%
20%
4%
14%
25%
1%
6%
0%
9 154
3 742
8 559
1 825
5 647
10 687
327
2 386
5 841
48 168
19%
8%
18%
4%
12%
22%
1%
5%
12%
10 155
3 722
9 099
2 031
5 764
10 656
363
2 045
6 108
49 943
20%
7%
18%
4%
12%
21%
1%
4%
12%
21 539
12 484
17 465
0
51 488
42%
24%
34%
0%
22 601
10 573
12 782
2 212
48 168
47%
22%
27%
5%
21 087
13 773
12 471
2 612
49 943
42%
28%
25%
5%
www.atlascopco.com
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Cash Flow
MSEK
Operating cash surplus after tax
of which depreciation added back
Change in working capital
Cash flow from operations
Investments in tangible fixed assets
Sale of tangible fixed assets
Other investments, net
Cash flow from investments
Operating cash flow
Company acquisitions / divestments
Dividends paid
Share redemption
Change in interest-bearing liabilities
Net cash flow
July 18, 2005
April - June
2005
2004
2 487
1 894
798
760
47
-26
2 534
1 868
-1 993
-1 515
623
496
-209
-75
-1 579
-1 094
955
774
-99
-1 721
-1 886
-1 573
-4 192
0
856
40
-4 366
-2 480
www.atlascopco.com
January – June
2005
2004
4 480
3 332
1 516
1 475
-75
-107
4 405
3 225
-3 329
-2 335
1 189
920
-293
-174
-2 433
-1 589
1 972
1 636
3 800
-1 731
-1 888
-1 575
-4 192
0
477
-137
169
-1 807
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Capital Expenditures
in Tangible Fixed Assets
MSEK
Quarterly
Net rental fleet investment
= MSEK 2 767
Machinery & buildings, quarterly
Net. Rental Eq.+Mach.& buildings, 12 months
Net. Rental Eq.+Mach.& buildings, quarterly
Net, Rental Equipment, quarterly
Net, Rental Equipment, 12 months
2500
5000
2000
4000
1500
3000
1000
2000
500
1000
0
-500
July 18, 2005
12 months
0
2001
2002
2003
www.atlascopco.com
2004
2005
-1000
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Contents
 Q2 Business Highlights
 Market Development
 Business Areas
 Financials
 Outlook
July 18, 2005
www.atlascopco.com
26
Near-term Outlook
The demand for Atlas Copco’s products and services is
expected to remain at a high level.
Demand from manufacturing and process industries is
expected to stay favorable. Activity in the construction industry
is expected to continue to increase somewhat. Demand from
the mining industry is expected to remain strong.
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July 18, 2005
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Cautionary Statement
 “Some statements herein are forward-looking and the actual
outcome could be materially different. In addition to the factors
explicitly commented upon, the actual outcome could be
materially effected by other factors like for example, the effect
of economic conditions, exchange-rate and interest-rate
movements, political risks, impact of competing products and
their pricing, product development, commercialization and
technological difficulties, supply disturbances, and the major
customer credit losses.”
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