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1 Wacker Neuson Group Working side by side with our customers

Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

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Page 1: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

1

Wacker Neuson Group – Working side by side with our customers

Page 2: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Why Wacker Neuson? 01

What makes us strong? 02

Where are we heading? 03

Appendix: Financial results 04

2

Page 3: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Why Wacker Neuson?

Page 4: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Maximum productivity & machine uptime

Comfortable & intuitive machine handling

Operator health & safety

Service, Partnership, Reliability

Attractive total cost of ownership

We align growth with our customers’ needs

4

Page 5: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

We drive innovation to improve our customers’ processes

5

Dual View Dumper Zero emissionVertical Digging System Onsite Box – mobile shop

Connected products Remote-control steeringHand-arm vibrations Modular design

Wireless handling with no

emissions

Cockpit rotatable by 180°

Shorter process

times due to exact vertical digging

On-site support for

our customers

Flexibility with one battery fitting 7

products

Give your machines a

voice!

Operating equipmentwithout any

time restrictions

Maximizing operator comfort

Page 6: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

We see our customers as our partners

6

Strong customer involvement in R&D

Sophisticated value engineering

Voice

of Customer

Technical

benchmarking

Early involvement

of all functions

Front Loading

With our accelerated

customer-oriented

product development

process, we provide our

customers with the right

features and the best

quality at the best price.

Teamwork at every step of the value chain

Research & Development

Page 7: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

We are a one-stop provider with an unrivaled offering

7

Light Equipment (LE) Compact Equipment (CE)

Different product groups

same customers

25%of Group sales1

55%of Group sales1

AcademyUsed Machines2Repair2 &

Maintenance2Rental Service2 Genuine PartsConcrete

solutions

Financial Solutions E-Store2 Telematics

Services

20%of Group sales1

1 FY 2019. 2 In selected countries.

Page 8: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Competitors include

Ammann

Bomag

Husqvarna

Weber MT

Customers trust in our longstanding expertise in LE

8

Demolition

Light Equipment (LE)

25%of Group sales1

CompactionConcrete technology

Power & Lighting Pumps

Heaters

€ 2,000Average price of an LE product1

In 1930, Wacker invented

the electric rammer. The

term "wacker packer" is still

used on construction sites.

1 FY 2019.

Page 9: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Customers opt for the advantages of compact equipment

9

Telehandlers Wheel loaders

Compact Equipment (CE)

55%of Group sales2

Dumpers Backhoe loaders Skid steers / Compact track loaders

Excavators

€ 36,000Average price of a CE product2

Urbanization,

limited space and

mechanization are

driving demand for

compact equipment

in construction and

agriculture.

Competitors include

Kubota

Takeuchi

Yanmar

Manitou

JCB

Bobcat (Doosan)

1 own estimates, based on underlying data from CECE and Off-Highway Research 2 FY 2019.

EUR 18 Bnexpected value of global compact

construction equipment market

accessible to Wacker Neuson in 20251

Page 10: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Market leaders trust in the WN Group’s high quality products

10

OEM (APAC)OEM (global2)Sales (EMENA & CIS1)

Wacker Neuson produces

for Caterpillar2

Kramer3 distributes

via JD’s dealer network

Wacker Neuson produces

for John Deere

1 Commonwealth of Independent States. 2 Not in Japan, phasing out. 3 Kramer “green line” only.

Page 11: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Service is key to our customers’ success

Academy

Used Machines2Repair2 &

Maintenance2

Financial Solutions

Rental Service2

E-Store2

Genuine Parts

Telematics

Concrete Solutions

Comprehensive services Collaborative relationship

We are there for our customers, listening,

sharing our expertise and working closely

with them to find the best solutions.

150 sales

and service

locations

Service, Partnership,Reliability

Customer proximity

20%of Group sales1

>550service technicians

in close proximity

to our customers

111 FY 2019. 2 In selected countries.

Page 12: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

12

What makes us strong?

Page 13: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

We serve our markets with three strong brands

13

Construction, gardening/landscaping, maintenance/repairs, etc. Agriculture, horse breeders, tree nurseries, etc.

Page 14: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Our diversified sales organization responds to regional needs

Direct sales &

rent to sell1 DealersKey accounts

& rental firmseCommerce1

Country-specific sales with long-standing customer relationships

1 In selected countries.14

Page 15: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

We drive electrification in our industry

EZ17e

DW15e

DT10e

AP1840e AP2560e

AS60e

AP1850e

ACBe

Full portfolio of zero emission products

ChangeWe are well prepared for the

shift to zero emission

construction sites

“If we learn early enough that

ambitious climate demands will

be imposed, we can drive

innovation forward by

demanding zero-emission

solutions from machinery

manufacturers, equipment

suppliers and contractors.”1

1 Ole Henrik Ystehede, director of EBA (Contractors Association - Building and Construction) for Oslo/Akershus/Østfold.

Through a smart and

innovative procurement

strategy, the City of Oslo

reduces climate gas

emissions at

construction sites.

15

Page 16: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Digitalization creates new opportunities for our business

Connected products –

always a step ahead

Pinpointing location –

connected jobsites

Give your machines a voice

Increasing runtime –

predictive maintenance

Transparency –

Real-time data analysis

Increasing efficiency –

smart products

Optimizing utilization

16

Page 17: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Our diversified business balances out cyclical fluctuations

17

Focus on maintenance & repair

of infrastructure large infrastructure

projects have no major impact on our

business

Rental equipment as buffering alternative to purchasing new

machines maximum flexibility for customers

Only small investment volumes

required

Broad customer base, diversified target industries

Different cycles in agriculture & construction

Resilience to cyclical

fluctuations

1 Source: Off-Highway Research, August 2019. 2 FY 2019

16%of Group sales

from agriculture2

>10different target

industries

0

400

800

1,200

1,600

2,000

0

200,000

400,000

600,000

800,000

1,000,000

Global equipment sales (units) Revenue WN Group (€ million)

-33%

1

+39%

[units] [€ m]

Page 18: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Where are we heading?

Page 19: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

We are on a steady growth path

Revenue development

758

992 1,0921,160

1,2841,375 1,361

1,5341,710

1,901

CAGR +10.8%[€ m]

19

>2 Bnrevenue

Strategy

2022targets

2 timesmarket growth

Page 20: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

+15%

Internationalization – plenty of room to grow

20

357.5

401.3

459.5

2017 2018 2019

1,129.8 1,248.9

1,379.0

2017 2018 2019

46.6

59.862.6

2017 2018 2019

+10%

+5%

73%of Group sales1

3%of Group sales124%

of Group sales1

AMERICAS

EUROPE

APAC

[€ m]

[€ m]

[€ m]

1 FY 2019.

Page 21: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Financing programs set up to enable future growth

Extension of anchor dealer network for LE

& CE

Skid steers as door opener for compact equipment

Large potential for

further market share gains

Americas – Anchor dealer strategy to accelerate our growth

21

Light Equipment

Compact Equipment

Services

1 Source: CECE, 2020. 2 John McClelland, ARA vice president, Nov. 2019.

Skid steer market North America1 (units)

60 yearsin the US light equipment market with

high market shares

“The equipment [...] rental industry is growing

and continues to expand faster than the

overall economy. […] In the U.S.,

construction equipment rental revenue is

expected to grow another 2.3 percent in

2020, 3.0 percent in 2021, 3.7 percent in

2022 and 3.1 percent in 2023 to reach

$43.9 billion.”2

2019

103,000

109,000

2018 2019

Page 22: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Europe – We are striving to increase market shares

22

Light Equipment

Compact Equipment

Services

2019

Further strengthening of

our market position

Gaining significant market shares in UK &

France (i.a.)

Expansion in agriculture with Weidemann and

Kramer

Game changer

We have redefined

safety and accelerated our

customers’ processes with

our Dual View dumpers

“The 2019 Market Report shows

encouraging growth across

Europe. A key driver being the

increasing pressure on the

industry to improve their CSR

credentials, with the

sustainability benefits of

equipment rental being realised

across industries. […].”1

1 Michel Petitjean, Secretary-General of the ERA, ERA Market Report 2019.

Major market shares in DACH –

plenty of room for growth

in other regions

Page 23: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Europe – We are growing our business in the ag sector

23

All-wheel steering

Articulated steering

Our customers are mainly dairy and

cattle farmers who work in confined

spaces such as stables.

They require small, highly

maneuverable machines with a

minimal turning radius and

outstanding stability.

Development of revenues in the ag sector1

Revenue in MIO. €

1 FY 2019.

+21%growth in CE for the

agricultural sector1

16%of Group sales

from agriculture1

0

100

200

300

2015 2016 2017 2018 2019

+12.6% CAGR

Page 24: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Ramping up production at

plant in Pinghu, China

Partnership with John Deere will

help improve utilization rate in

new plant

Even small market shares would leverage

our sales significantly

APAC – We benefit from structural market changes in China

24

Light Equipment

Compact Equipment

Services

1 Source: Off-Highway Research, Feb. 2020.

0%

20%

40%

60%

80%

100%

Crawler Excavators Wheeled LoadersMini Excavators Mobile CranesCompactors & Pavers Graders & Dozers

Changing market structure in China – compact equipment on the rise1

Mini excavator market China 2019(units)1

2019

Cooperation with John Deere for the sale of

“Deere”-brand mini and compact excavators

initially in China, Australia and selected Southeast

Asian countries.

85,000

2019

Page 25: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

1 March 2020

APAC – In the region for the region

>20 yearsin the Chinese

light equipment market

Our R&D team in

China comprises

20engineers

working on

solutions tailored

to the region1

Excavator: EZ17.Key Chinese players Key International players

Sany

XuGong

(XCMG)

LiuGong

Caterpillar

Volvo

Hitachi

Kobelco

Kubota

Doosan

Hyundai

China – divided competitive landscape

Production and R&D center in Pinghu, China

25

Page 26: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

We benefit from megatrends

- Maintenance of

infrastructure

- Limited space

- Clean air

regulations

- Noise pollution

- Growing

middle class

- Food

- Mechanization

- Infrastructure

- Housing

- Energy efficiency

- Waste

management

- Process

optimization

- Telematics

- Smart products

- Building Infor-

mation Modeling

(BIM)

26

Page 27: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Solid Balance Sheet Structure

271 As at December 31, 2019.

56%Equity ratio1

1.7Net financial debt/

EBITDA1

Excellent basis

for further profitable growth

Page 28: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Clear-cut strategy and experienced management team

28

Martin Lehner

CEO

Responsible for strategy, procurement,

production, technology, quality, investor

relations, corporate communication,

sustainability, compliance, HR and legal

matters.

Alexander Greschner

CSO

Responsible for sales, service and

marketing.

Wilfried Trepels

CFO

Responsible for finance, controlling, audit,

IT & organization, Supply Chain and real

estate.

Page 29: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Customer-focused strategy

- Streamlining

production sites

29

- Focus on core

areas of expertise

- China as a

growth market

- Development of

digital solutions for

our customers

- Investment in

growth fund for

Industry 4.0

startups

- Expansion of zero

emission product

portfolio

- Employee

development

programs

- Better integration

of sales and

production

- Streamlining the

Group’s internal

supply chain

CUSTOMER CENTRICITY

Page 30: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

25

50

75

100

125

150

175

Wacker Neuson SDAX DAX Peer group

1.30

0.940.81

1.25

2.06

1.26

0.50 0.50 0.500.60

1.10

0.60

38%53% 62%

48% 43% 48%

-200%

-150%

-100%

-50%

0%

50%

-0.20

0.30

0.80

1.30

1.80

2.30

2.80

2014 2015 2016 2017 2018 2019

EPS in € Dividend per share in € Payout ratio

Share Development

30

The share in 2019/20201

Key figures per share

Dividend payout

1 As at Apr. 7, 2020 2 Peer group: Ashtead, Atlas Copco, Bauer, Caterpillar, Cramo, Deutz, DoosanBobcat, Haulotte,

Husqvarna, John Deere, Komatsu, Manitou, Palfinger, Terex, United Rentals, Volvo. 3 As at Apr. 8, 2020.

Family 58%

Free float 42%

(Total shares: 70,140,000)

Coverage3 Shareholder structure

in € 2019 2018

Earnings per share 1.26 2.06

Book value per share 17.47 17.41

Share price at end of period 17.05 16.52

Market capitalization (€ m) 1,195.9 1,158.7

0.50

0.60

Special dividend in €

Suggestion

for AGM

% +3%

2

-37%

Bank TP (€) Recom. Date

Jefferies 21.00 Buy Mar 16, 2020

Warburg 17.50 Buy Mar 18, 2020

Hauck & Aufhäuser 17.00 Buy Mar 09, 2020

Bankhaus Lampe 17.00 Buy Jan 23, 2020

Berenberg 13.00 Buy Mar 26, 2020

Metzler 13.00 Buy Apr 08, 2020

Commerzbank 10.00 Hold Mar 25, 2020

Kepler Cheuvreux 8.00 Reduce Mar 17, 2020

Page 31: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Wrap up

31

Resilience to cyclicality

Focus on maintenance & repair of

infrastructure

Broad customer base, diversified target

industries

Solid base

Growth potentialMegatrends as

business driversGlobal trend towards compact equipment

Growth opportunitiesin Europe, North

America and APAC

Sales channelsDirect sales & rent

to sellDealers

Key accounts & rental firms

eCommerce

Products

Innovation- and market-leading position in light and compact equipment

Future-proof product portfolio

driven by innovation

One-stop shopPioneers in zero

emissionsolutions

Focus on theright products forthe right markets

High equity ratio, family as anchor

shareholders

Page 32: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

32

Appendix – Financial results

Page 33: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Key Figures

33

Revenue yoy

+11.2%

EBIT yoy

-5.7%

FCF

€ -115.7 m

(margin: 8.1%)

FY 2019

NWC1 ratio: 42.7%

(+5.0 PP yoy)

DIO2: 154 days

(-7 days yoy)

Equity ratio: 55.8%

(-8.0 PP yoy)

December 31, 2019

(€ 1,901 m)

(2018: € -0.3 m)

EPS

€ 1.26

(2018: € 1.41)3

1 Net working capital / revenue. 2 Days inventory outstanding = (inventory / cost of sales)*365 days.3 Adjusted for the extraordinary income from the sale of a real estate in Munich in Q2/18.

Revenue yoy

+3.0%

EBIT yoy

-32.2%

FCF

€ 87.0 m

(margin: 5.9%)

Q4 2019

(€ 483 m)

(Q4/18: € -9.1 m)

EPS

€ 0.12

(Q4/18: € 0.32)

Page 34: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

FY 2019: Continued growth in revenue and earnings

34

Income statement (condensed)

Comments on FY 2019

Revenue +11.2% yoy (adj. for FX effects: +9.8%)

▪ Growth in all regions and segments

▪ Positive development in ag business

Gross profit +3.6% yoy (gross profit margin -1.8 PP)

▪ Reduction of production programs due to the

targeted inventory streamlining

▪ Restructuring of the North American production plant

▪ Inventory sell-offs, especially in the US and Scandinavia

EBIT -5.7% yoy (EBIT margin: -1.4 PP)

▪ Increased sales and service expenses due to a higher business

volume, increased personnel as well as trade fair costs

▪ Change in reporting in connection with income from customer financing:

reallocation from financial result and other income to revenue line.

Effect on EBIT 2019: € +3.5m, effect 2018: € +2.6m

Earnings per share -38.8% yoy (adj. -10.6%)

▪ Financial result below PY with € -15.6m (2018: € -14.1m), primarily due

to increased interest expenses

▪ Group tax rate at 35.6% (2018: 28.8%); increase as a result of

depreciation or non-capitalization of deferred tax assets

€ m Q4/19 Q4/18 2019 2018

Revenue 483.2 469.1 1,901.1 1,710.0

Gross profit 110.1 119.4 474.9 458.4

as a % of revenue 22.8% 25.5% 25.0% 26.8%

Op. costs (excl. other income/expenses) -87.9 -81.6 -337.5 -309.3

as a % of revenue -18.2% -17.4% -17.8% -18.1%

EBIT 28.4 41.9 153.1 162.3

as a % of revenue 5.9% 8.9% 8.1% 9.5%

Financial result -6.7 -6.2 -15.6 -14.1

Taxes on income -13.3 -13.1 -49.0 -58.4

Profit for the period 8.4 22.6 88.5 144.6

EPS (in €) 0.12 0.32 1.26 2.06

Adj. profit for the period1 8.4 22.6 88.5 98.8

Adj. EPS (in €)1 0.12 0.32 1.26 1.411 Adjusted for the extraordinary income from the sale of a real estate in Munich

in the value of EUR 45.8 million after tax.

Revenue remains on growth path

Revenue

[€ m]

EBIT

margin

1,375 1,3611,534

1,7101,901

7.4% 6.5%8.6% 9.5%

8.1%

0%

5%

10%

15%

20%

0

500

1,000

1,500

2,000

2015 2016 2017 2018 2019Revenue EBIT-margin

+11.2%

+8.4% CAGR

Page 35: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Compact equipment continues to drive growth

1,901.1

62.6

459.5

1,379.0

FY 2019

Asia-Pacific

Americas

Europe

FY 2019: Development by Region and Business Segment

35

Growth in all regions

Revenue Europe +10.4 % (adj. for FX effects +10.3%)

▪ Growth supported by most European countries;

double-digit growth in England despite a difficult market environment

▪ Agriculture business revenue +21.2% (Kramer and

Weidemann brands)

▪ EBIT development impacted by reduction of production program

Revenue Americas +14.5% (adj. for FX effects +9.1%)

▪ High demand for products of worksite technology

▪ Significantly higher sales of skid steer loaders and other compact

machines such as excavators, dumpers and telehandlers

▪ Progress in expanding dealer network

▪ Earnings above PY, however still negative as a result of restructuring

costs as well as difficulties in rolling out newly developed processes

and inventory sell-offs

Revenue Asia-Pacific +4.7% (adj. for FX effects +4.7%)

▪ Continuing expansion of portfolio of locally produced machines

▪ Higher pressure on prices China and Australia

73%

24%

3%

100%

+10%

+15%

+5%

+11%

share

161.5

-2.9

-1.9

153.1

EBIT1

Comments on FY 2019

Revenue [€ m]

1,920.6

382.5

1,052.8

485.3

FY 2019

Services

Compact equipment

Light equipment 25%

55%

20%

100%

+6%

+14%

+9%

+11%

share

1 EBIT by region before consolidation.2 Revenue by segment before cash discounts.

Revenue [€ m]2

Page 36: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

FY 2019: Net working capital increased significantly

36

Inventories

Trade payables

Trade receivables

1 Days inventory outstanding = (Inventories/cost of sales)/4*365 days; 2 Days sales outstanding =

(trade receivables/revenue)/4*365 days; 3 Days payables outstanding = (trade payables/cost of sales)/4*365 days.

Comments

Trade payables

[€ m]

Inventories

[€ m]DIO1

[days]

Trade receivables

[€ m]

DPO3

[days]

DSO2

[days]

▪ Inventories remain above plan despite clear stock reduction in the

fourth quarter

▪ Increase in trade receivables yoy due to increased business volume

and expansion of dealer network in North America

▪ Decrease in trade payables in connection with reduced production

output in the second half of the year

▪ Net working capital significantly increased (see next slide)

434 459 462500

553

633 645 663603

141 153130

151 144

179155

173147

0

100

200

300

400

0

100

200

300

400

500

600

700

Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19

235273

320 304 303

371413 400

359

5567 64 67

59

78 73 7868

0

50

100

150

200

0

100

200

300

400

500

Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19

134149

163 167

213 208 199

164150

43 50 46 50 56 59 48 43 37

0

100

200

300

400

0

100

200

300

Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19

Page 37: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

FY 2019: Reversal of cash flow trends in Q4

37

Net Working Capital

Free cash flow

Cash flow from operating activities

Comments

Free cash flow

[€ m]

Cash flow from operating

activities [€ m]

Net working capital

[€ m]

Net working capital

as a % of revenue1

▪ Increased net working capital yoy due to increase in inventory and

trade receivables as well as reduced trade payables (see previous

slide)

▪ Clear improvement of free cash flow in Q4/19 due to progress in

reduction of inventories and reduced trade receivables

▪ Investments2 above PY at EUR 89.2m (2018: EUR 73.3m). Significant

investments into future growth, most notably into the expansion of the

European production sites

536583 620 638 644

797858 899

812

34%39%

34%38%

34%

46%42%

48%42%

0%

20%

40%

60%

80%

100%

0

200

400

600

800

1000

Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19

63

-41

6 10 10

-116

-29

2

122

-150

-100

-50

0

50

100

150

Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19

46

-45

57

-3 -9

-143

-43 -17

87

-160

-120

-80

-40

0

40

80

Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19

1 Net Working Capital/annualized quarterly revenue. 2 Investments in property, plant and equipment and intangible assets.

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Balance Sheet Structure

38

Net financial debt

[€ m]

Comments

Equity [€ m]

Gearing1 increased yoy

Equity ratio

Net financial debt/EBITDA2

1 Net financial debt/equity. 2 Net financial debt/annualized EBITDA for the quarter; also depreciation

and rights of use according to IFRS 16 are included in depreciation and amortization since Q1/19.

Gearing1

Equity ratio

Net financial debt/

EBITDA2 [x]

▪ Net financial debt and gearing have increased significantly yoy

▪ Promissory note (Schuldschein) of € 150m placed in Q2/19

at attractive conditions

▪ Ratio of net financial debt to EBITDA above plan

▪ Equity ratio reduced structurally by 2 percentage points due to the first-

time application of IFRS 16

148193 188 193 205

358

484513

439

13% 17% 16% 16% 17%

29%

41% 42%36%

0%

20%

40%

60%

80%

100%

0

100

200

300

400

500

600

Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19

0.7

1.2

0.60.8 0.7

1.61.5

1.9

1.7

0.0

0.5

1.0

1.5

2.0

Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19

1,115 1,122 1,170 1,200 1,221 1,241 1,188 1,217 1,225

69%65% 65% 65% 64%

58%53% 54% 56%

0%

20%

40%

60%

80%

100%

0

200

400

600

800

1,000

1,200

1,400

Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19

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Cost reduction and efficiency enhancement program

39

Key provisions

Reduction on material costs

Underabsorption

Purchasing costs

Restructuring costs (production affiliate USA)1

Discounts and impairment 1

Restructuring sales organization

Shipping costs

Restructuring costs (sales affiliate USA)

Reduction of inventory levels

1 Topics which burdened profitability in 2019. Impact in 2020 is estimated to fade.

Cost reduction and efficiency enhancement program covers all Group divisions.

4 focus topics each in production & purchasing and sales & administration

Production & Purchasing Sales & Administration

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Outlook

40

Revenue and earnings guidance for 2020

Construction: Business barometer Agriculture: Business barometer

Comments

▪ Large uncertainties w.r.t. the continued spread of the coronavirus

and the effects of the related measures by states and institutions alike

▪ Related consequences on customer demand as well as global supply

chains of the Group not quantifiable

▪ Approved guidance, as at March 9, 2020:

Revenue between € 1,700 and 1,900m

EBIT margin between 6.5 and 8.5%

Investments of around € 80 to 100m

Net working capital as a % of revenue to be stagnant or to

improve slightly relative to December 31, 2019

1,901

8.1%

6%

7%

8%

9%

10%

0

500

1,000

1,500

2,000

FY 2019 Outlook 2020

1,700-1,900

6.5 – 8.5%

Source: CECE, March 2020. Source: CEMA, March 2020.

-11% to -0%Revenue [€ m] EBIT

margin

2012 2013 2014 2015 2016 2017 2018 2019 2020

Page 41: Wacker Neuson Group Working side by side with our customers€¦ · of Group sales2 Dumpers Backhoe loaders Skid steers / Compact track loaders Excavators € 36,000 ... Global equipment

Financial calendar and contact

41

Publication of the 2019 Annual Report

Hauck & Aufhäuser eRoadshow

Publication of Q1 report 2020

Metzler Roadshow, Frankfurt

Berenberg Roadshow, Benelux

Commerzbank Roadshow, Zurich

Jefferies Roadshow, Milan/Lugano

Hauck & Aufhäuser Roadshow, London

March 16, 2020

April 9, 2020

May 7, 2020

May 11, 2020

May 12, 2020

June 16, 2020

June 17, 2020

June 23, 2020

June 24, 2020 MainFirst Roadshow, Paris

July 21, 2020 Annual General Meeting, MunichDisclaimer

This report contains forward-looking statements which are based on current estimates and assumptions made by corporate management at Wacker Neuson SE. Forward-looking statements are

characterized by the use of words such as expect, intend, plan, predict, assume, believe, estimate, anticipate and similar formulations. Such statements are not to be understood as in any way

guaranteeing that those expectations will turn out to be accurate. Future performance and the results actually achieved by Wacker Neuson SE and its affiliated companies depend on a number of risks

and uncertainties and may therefore differ materially from forward-looking statements. Many of these factors are outside the Company's control and cannot be accurately estimated in advance, such as

the future economic environment and the actions of competitors and market players. The Company neither plans nor undertakes to update any forward-looking statements.

All rights reserved. Valid March 2020. Wacker Neuson SE accepts no liability for the accuracy and completeness of information provided in this brochure. Reprint only with the written approval of

Wacker Neuson SE in Munich, Germany. The German version shall govern in all instances.

Contact

Wacker Neuson SE

IR contact: +49 - (0)89 - 354 02 - 427

[email protected]

www.wackerneusongroup.com