Schaeffler Group
Profitable growth continues
Q2 2011 results
August 31, 2011
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management's current expectations and are subject to a number of factors and uncertainties that could cause actual results to differ
materially from those described in the forward-looking statements. Actual results may differ from those set forth in the forwardlooking statements as a result of various factors (including, but not limited to, future global economic conditions, changed market
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which are subject to change and audit.
Page 2
Schaeffler Q2 2011 Results ● 31 August 2011
Agenda
Overview
Q2 2011 Results
Outlook
Page 3
Schaeffler Q2 2011 Results ● 31 August 2011
1 Overview
Highlights Q2 2011
All regions and business units contribute to sales growth of 11.7% in Q2 2011
Automotive: sales growth driven by underlying market growth,
new business contracts and new products
High growth rates in torque converters, tapered roller bearings,
valve lash adjustment elements, dry double clutches
Industrial: sales growth driven by Production Machinery,
Power Transmission and Aftermarket
Positive book-to-bill ratio in both divisions
Bundling our comprehensive electric mobility expertise in
"eMobility System House"
Investment agreement for new rolling bearings production plant in
Nanjing (China) signed
Supplier awards from Porsche, Volkswagen, Daimler, Siemens, Fiat,
Great Wall Motors, Motortec, Goldwind and others
Page 4
Schaeffler Q2 2011 Results ● 31 August 2011
1 Overview
Profitable growth continues
H1 2011
H1 2010
in EUR mn
in EUR mn
in EUR mn / %
5,379
4,562
+17.9%
883
739
+19.5%
16.4%
16.2%
+0.2 %-pts
641
-260
+901 mn
4 Free cash flow
77
336
-259 mn
5 Leverage ratio
2.7x
3.5x
-0.8x
27.4%
18.0%
+9.4 %-pts
1 Sales
2 EBIT
2 EBIT margin
3 Net income
6 ROCE
Page 5
Schaeffler Q2 2011 Results ● 31 August 2011
∆
2 Q2 2011 Results
1
Sales growth +12% versus Q2 2010
Sales Schaeffler Group
Sales by region Schaeffler Group
in EUR mn
share in % / vs. Q2 2010 in %
+12%
vs. Q2 2010
2,697 2,682
2,452 2,481
2,402
Asia / Pacific
+9%
2,160
1,768
1,721
Germany
+12%
21%
1,971
1,876
South America
27%
6%
+3%
13%
North America
3,489
3,847
4,562
4,933
5,379
+8%
33%
Europe1
Q1
Q2
Q3 Q4
2009
Gross
profit
margin
Page 6
23% 22% 27% 25%
Q1
Q2 Q3 Q4
2010
31% 32% 33% 30%
Q1
Q2
+17%
2011
32%
30%
1) without Germany
Schaeffler Q2 2011 Results ● 31 August 2011
2 Q2 2011 Results
1
Automotive sales at high level – Growth in Industrial continues
Sales Automotive
Sales Industrial
in EUR mn
in EUR mn
+10%
vs. Q2 2010
1,822
1,608 1,598
1,491
1,769
1,628
+17%
vs. Q2 2010
1,351
1,254
1,130
1,008
703
2,138
Q1
2,605
Q2
Q3
Q4
2009
Gross
profit
margin
Page 7
17% 20% 27% 24%
3,099
Q1
3,226
Q2
Q3
Q4
2010
29% 29% 31% 27%
3,591
Q1
748
623 600 587
1,326
Q2
Q1
Q2
27%
Q3
Q4
2009
2011
29%
1,187
Gross
profit
margin
32% 26% 29% 28%
Schaeffler Q2 2011 Results ● 31 August 2011
810 803
855 877
641
1,389
Q1
1,613
Q2
Q3
Q4
2010
37% 39% 39% 37%
1,732
Q1 Q2
2011
39% 36%
2 Q2 2011 Results
2
EBIT margin stabilizes at high level
EBIT Schaeffler Group
Δ EBIT Schaeffler Group
in EUR mn
in EUR mn
+2%
817
vs. Q2 2010
472
404 398
411
372
883
335
739
-594
-17
COGS
R&D
-48
-14
187
151
37
71
108
Q1
338
Q2
Q3
739
Q4
2009
EBIT
margin 2.1% 4.0% 10.0% 7.7%
Page 8
Q1
770
Q2
Q3
883
xx
xx
Q4
2010
15.5%16.8% 16.2% 15.0%
Q1
Q2
EBIT
H1 2010
2011
17.5% 15.3%
EBIT
margin
16.2%
Schaeffler Q2 2011 Results ● 31 August 2011
Sales
Selling Admin &
EBIT
others H1 2011
16.4%
2 Q2 2011 Results
2
Automotive EBIT slightly down – Industrial EBIT further improves
EBIT Automotive
EBIT Industrial
in EUR mn
in EUR mn
-4%
vs. Q2 2010
302
273
239
151
249
+15%
261
vs. Q2 2010
229
170
133
131
31
-1
284
512
478
563
150
96
78
40
149 143
36
109
18
54
227
292
320
-41
Q1
Q2
Q3
Q4
2009
EBIT
margin
Page 9
-4.1% 3.5% 12.0% 9.8%
Q1
Q2
Q3
Q4
2010
16.0%17.0% 15.6% 14.1%
Q1 Q2
Q1
Q2
Q4
2009
2011
16.6% 14.8%
Q3
EBIT
margin
11.1% 5.0% 6.0% 3.1%
Schaeffler Q2 2011 Results ● 31 August 2011
Q1
Q2
Q3
Q4
2010
15.0%17.5% 18.4% 17.8%
Q1 Q2
2011
19.9% 17.1%
2 Q2 2011 Results
3
Net income significantly above prior year
Net income H1 2001
Net income
in EUR mn
in EUR mn
438
5,379
147
39
-625
Interest
result
195
At-equity
result
Conti
-203
641
323
641
-579
One-off dilution loss of
EUR -396 mn
-4,496
-215
203
97
-260
883
176
-235
-222
-344
-357
-422
Sales
Q2
2011 2,682
Page 10
Costs
-2,271
EBIT
411
Financial
result
-125
Taxes/
minorities
Net
income
-83
203
Q1
Q2
Schaeffler Q2 2011 Results ● 31 August 2011
Q3
2009
Q4
Q1
Q2
Q3
2010
Q4
Q1 Q2
2011
2 Q2 2011 Results
3
Interest result impacted by mark-to-market adjustments
Interest result1
Composition of interest result YTD2/3
in EUR mn
in EUR mn
156
1093
279
47
45
310
215
289
246
240
224
Q1
214
170
Q2
141
94
119
185
1
416
Q1
513
Q2
Q3
2009
550
Q4
Q1
260
Q2
Q3
Non-Cash
215
Q4
2010
Q1
Q2
P&L
2011
Mark-to-market
interest rate derivatives
Cash
Others
Δ Interest expenses Others
Cash financial debt
2) Debt push down of EUR 600 mn not included (conducted in July 2011)
3) Includes effects from the discontinuation of hedge accounting
1) For presentation purposes, results are shown as positive figures
Page 11
Schaeffler Q2 2011 Results ● 31 August 2011
2 Q2 2011 Results
3
At-equity result Continental at EUR89 mn
Net income Continental AG
in EUR mn
368
228
2010
315
213
Q1
Q2
Q3
Q4
FY
Q1
Q2
228
121
14
213
576
368
315
Conti Shares
(as of 05/11:
36.1%)
99
51
6
90
246
155
1331
PPA
-52
-51
-51
-45
-199
-49
-44
Dilution Loss
-396
0
0
0
-396
0
0
At-equity
Result
-349
0
-45
45
-349
106
89
121 14
349
-457
227
683
Net Income
Conti
-1,192
-153
-190
-267
-1,039
Q1 Q2 Q3
Q4
Q1 Q2 Q3 Q4
2009
2010
Sales
4,302 4,761 5,337 5,696
EBIT
-165
39
-912
-2
2011
5,997 6,658 6,490 6,903
494
517
365
Q1 Q2
559
7,346 7,533
634
647
1) Incl. one-off effect of EUR 13 mn
Page 12
2011
Schaeffler Q2 2011 Results ● 31 August 2011
2 Q2 2011 Results
4
Positive free cash flow despite higher capex
Free cash flow
Free cash flow H1 2011
in EUR mn
in EUR mn
1,165
331
209 190
184
104
-1,835
435
-301
127
40
336
230
66
11
-308
77
-279
77
-200
-2,019
Q1 Q2 Q3 Q4
Q1 Q2 Q3 Q4
2009
2010
Q1
EBITDA
Q2
2011
Q2
2011
Page 13
552
Schaeffler Q2 2011 Results ● 31 August 2011
Δ Net
working
capital
-16
Capex
Interest
Tax/
Others
-188
-141
-141
Free
cash flow
66
2 Q2 2011 Results
4
Working capital stable – Capital expenditure at targeted level
Working capital
Capital expenditure
in EUR mn
in EUR mn
2,463
2,280
2,182
1,993
2,268
2,424 2,405
2,547 2,562
2,325
188
162
119
120
98
72
65
51
39
217
Q1
Q2
Q3
Q4
2009
% of
sales1 29.7 29.6 29.7 27.2
Q1
Q2
Q3
Q4
Q1
Q1
Q2
2010
2011
29.2 28.8 26.8 24.5
25.4 24.8
Q3
Q4
123
Q1
2009
% of
sales
6.9
5.5
1) Calculation based on LTM (Last Twelve Months) Sales
Page 14
104
Q2
Schaeffler Q2 2011 Results ● 31 August 2011
2.1
76
238
Q2
Q3
308
Q4
2011
2010
3.3
2.4
3.0
3.1
Q1 Q2
6.5
4.4
7.0
2 Q2 2011 Results
5
Leverage ratio at 2.7x
Net financial debt / Leverage ratio1
Available funds
in EUR mn
in EUR mn
6,104 6,098
6,131
6,020
5,897 5.6x
6,124 6,069
5,930
1,481 1,475
5,763 5,744
1,325
5.0x
1,215
1,092
4.4x
4.9x
1,190
1,049 1,093
976 998
4.2x
3.5x
3.0x
2.7x
Q1
Q2
Q3
2009
Q4
Q1
Q2
Q3
Q4
2010
2.8x 2.7x
Q1
Q2
2011
Q1
Q2
Q3
Q4
Q1
Q2
Q3 Q4
2010
2009
Q1
Q2
2011
Leverage ratio (net financial debt / LTM EBITDA)
Revolver
1) Debt push down of EUR 600 mn not included (conducted in July 2011)
Page 15
Schaeffler Q2 2011 Results ● 31 August 2011
Ancillary lines
Cash & cash equivalents
2 Q2 2011 Results
Strong ROCE level maintained – Equity ratio >20%
6
ROCE
Equity ratio
in %
in %
27.3 27.4
25.1
25.8
26.6
25.0
24.2
21.6
22.8 22.7
22.6
21.5
18.0
7.9
Q2
7.9
Q3
7.3
Q4
2009
Capital
Em6,503 6,229 6,007 5,740
ployed
Page 16
21.3
12.4
11.2
Q1
24.6
Q1
Q2
Q3
Q4
2010
5,995 6,131 5,967 5,941
Q1
Q2
Q1 Q2 Q3
2011
6,105 6,157
Q4
2009
Total
Equity 3,554 3,500 3,162 2,852
Schaeffler Q2 2011 Results ● 31 August 2011
Q1 Q2
Q3 Q4
2010
2,755 3,023 3,022 3,341
Q1 Q2
2011
3,288 2,719
3 Outlook
Key objectives for 2011 to be overachieved
Growth
Sales growth
CAPEX
Profitability
> 10 %
(previously: 8-10%)
6-8 % of sales
EBIT Margin
> 13 %
Free Cash Flow
sustainably positive
Quality
Innovation
Quality policy
Zero defects
R&D expenses
around 5 % of sales
Employees
> 8,000 new
employees to support
worldwide growth
Innovation
management
> 1,600 patent
registrations in
Germany
Page 17
Schaeffler Q2 2011 Results ● 31 August 2011
Schaeffler Investor Relations
Investor Relations
Phone: + 49 9132 82 4440
Financial Calendar
ir@schaeffler.com
9M 2011 results:
November 22, 2011
www.schaeffler-group.com/ir
FY 2011 results:
March 20, 2012