Wacker Neuson SE
Roadshow presentation, June 2018
Agenda
2
Q1/18
Outlook
Overview
Wacker Neuson SE, June 2018
Product range to meet the full spectrum of customer needs
3
Light Equipment Compact Equipment
1 FY 2017.2 In selected countries.
Concrete technology Compaction
Demolition Power & Lighting Pumps
Heating
Excavators
Dumpers
Telehandlers Wheel loaders
Skid SteersBackhoe-loaders
AcademyUsed machines2
Repair2 &
Maintenance2
Financing
Rental service2
e-Store2
Spare parts
Telematics
Services
52% of sales127% of sales1 21% of sales1
Wacker Neuson SE, June 2018
Target industries besides construction
4
Markets Light equipment Compact equipment
Agriculture
Renovation/rehabilitation
Development
Infrastructure (road and highway
construction, bridge construction)
Gardening and landscaping
Handling logistics/port logistics
Residential construction
Demolition
Maintenance/repairs
Industry & Recycling
Underground construction
Oil & gas/energy industry
Events
Municipalities
Target group oriented sales:
Light equipment 27%
Compact equipment 52%
Services 21%
Revenue split (2017, as %)
Business segmentsMost industries demand both light an compact equipment
Wacker Neuson SE, June 2018
Our brands and target groups
5
Construction, gardening/landscaping, energy sector etc. Agriculture, horse breeders, tree nurseries etc.
Wacker Neuson SE, June 2018
Global footprint
6
Sales by region Core markets: EMENA & NAM, further internationalization ongoing
Europe 74% Americas 23% Asia-Pacific 3%
Revenue split (2017)
Wacker Neuson SE, June 2018
5 year comparison
7
[%][€ m]
Revenue and EBIT margin 2013-2017
Wacker Neuson SE, June 2018
Agenda
8
Q1/18
Outlook
Overview
Wacker Neuson SE, June 2018
Key Figures
9
Revenue yoy
+9.5%
EBIT yoy
+60.8%
Op. CF
€ -41m
FCF
€ -45m
(margin: 6.2%)
Q1/18
NWC1-ratio: 37.9%
(-4.9PP yoy)
DIO2: 150 days
(-17 days yoy)
Equity ratio: 65.8%
(-1.2PP yoy)
March 31, 2018
(€ 370.5m)
(Q1/17: € -26m)(Q1/17: € -19m)
Adj. EBIT yoy
+41.1%
EPS yoy
+61.5%
(margin: 6.2%)
(€ 0.21)
1 Average net working capital for the quarter / annualized revenue for the quarter.2 Days inventory outstanding: (average inventory for the quarter / annualized cost of sales for the quarter)*365.
Wacker Neuson SE, June 2018
316
381
316348 339
425379 392
371
5.5%
8.7%
6.5%5.1%
4.2%
11.0% 10.6%
7.8%6.2%
0%
5%
10%
15%
20%
0
100
200
300
400
500
Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18
Revenue and earnings
10
+9.5%
Revenue and earnings significantly higher than in Q1/17
Income statement (excerpt)
Comments on Q1
Revenue +9.5%
Strong demand in core markets Europe and North America, deliveries
delayed by bottlenecks on supplier side
Currency-adjusted revenue increased 14.2%
Gross profit margin at prior-year level (+0.1PP)
Less favorable regional and product mix yoy
Higher material prices, limited material availability
EBIT +60.8%
Operating cost at prior-year level, percentage of revenue down by 2.0PP
Adjustments: In Q1/18, no adjustments were made. A negative one-off
effect in the amount of € 2.0m was reported in Q1/17.1
Earnings per share +61.5%
Financial result: Negative FX effects (€ -1.6m), slight increase in interest
income (€ +0.3m)
Tax rate stable at 29.1% (Q1/17: 29.0%)
Revenue
[€ m]
[€ m] Q1/18 Q1/17 Δ
Revenue 370.5 338.5 9.5%
Gross Profit 100.6 91.9 9.5%
as a % of revenue 27.2% 27.1% 0.1PP
SG&A incl. other income/expenses -77.6 -77.6 0.0%
as a % of revenue -20.9% -22.9% 2.0PP
EBIT 23.0 14.3 60.8%
as a % of revenue 6.2% 4.2% 2.0PP
Adj. EBIT 23.0 16.3 41.1%
as a % of revenue 6.2% 4.8% 1.4PP
Profit for the period 14.6 9.3 57.0%
EPS (in €) 0.21 0.13 61.5%
1 Linked to changes to the Executive Board.
EBIT
margin
Wacker Neuson SE, June 2018
Strongest growth in the compact equipment segment
370.5
11.0
91.7
267.8
Total Q1/18
Asia-Pacific
Americas
Europe
Business development by region and business segment
11
Growth mainly driven by Europe and North America
Revenue Europe +8% yoy (adj. for currency effects: +9%)
Strong growth in particular in France, England, Poland, Austria and
Benelux countries; recovery momentum continues in Southern Europe
Revenue compact equipment for the agricultural sector +12%, alliance
with John Deere developing as planned
Revenue Americas +13% yoy (adj. for currency effects: +29%)
Double-digit growth in both North and South America
Region again makes positive contribution to earnings
Strong growth in worksite technology and compact equipment
Intensified competitive pressures due to imports from the Eurozone
becoming more expensive
Rental chains show high level of investment activity
Revenue Asia-Pacific +16% yoy (adj. for currency effects: +26%)
Strong growth reported for excavators in China
Start of production at new plant in Pinghu (near Shanghai)
Restructuring in Australia completed (provision for negative one-off effect
from the sale of a building already recognized in Q4/17)
72%
25%
3%
100%
+8%
+13%
+16%
+9%
share yoy
36.2
1.4
-0.7
23.0
EBIT1
Comments on Q1
Revenue [€ m]
370.5
73.2
199.4
103.2
Total Q1/18
Services
Compact Equipment
Light Equipment 27%
53%
20%
100%
+5%
+13%
+7%
+9%
share yoy
1 EBIT for regions before consolidation.2 Revenue by business segment before cash discounts.
Revenue [€ m]2
Wacker Neuson SE, June 2018
1,067 1,057 1,067 1,093 1,102 1,083 1,103 1,115 1,124
67% 66% 68% 69% 67% 65% 67% 69% 66%
0%
20%
40%
60%
80%
100%
0
200
400
600
800
1,000
1,200
Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18
235258
224206
237 245
195
148
193
22%24%
21% 19%22% 23%
18%13%
17%
0%
10%
20%
30%
40%
50%
60%
70%
0
100
200
300
Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18
Sound balance sheet structure
12
At 17%, gearing1 remains at a conservative level
Net financial debt higher than at the close of the year due to seasonally
higher net working capital
Promissory note (Schuldschein) of USD 100m issued end of February
2018
Short-term credit lines replaced with three medium-term credit lines
1.7
1.3
1.5 1.4
1.9
0.90.8
0.7
1.2
0.0
0.5
1.0
1.5
2.0
Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18
Net financial debt
[€ m]
Comments on Q1
Equity
[€ m]
Gearing1 further reduced yoy
Stable equity ratio
Net financial debt/EBITDA2 at low level
1 Net financial debt / equity. 2 Net financial debt/annualized EBITDA for the quarter.
Gearing1
Equity ratio
Net financial debt/
EBITDA2 [x]
Wacker Neuson SE, June 2018
-31
12
35
19
-26
28
5146
-45-50
-30
-10
10
30
50
Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18
Management of net working capital proving effective
13
Free cash flow negative due to seasonality
Net working capital ratio1 down 5PP yoy
Days inventory outstanding (DIO)2 down 17 days yoy
Cash flow from operating activities € -41.4m (Q1/17: € -19.1m) primarily
due to an increase in net working capital € +52.4m (Q1/17: € +21.4m)
Seasonal increase in inventory in Q1
Delayed deliveries (due to bottlenecks on supplier side)
Increase in trade receivables due to higher business volume
Drop in cash flow from investment activities (Q1/18: € -3.7m;
Q1/17: € -6.9m) due to sale of building in Australia
470 455 446 445 452 445 434 435 443
187
152
180
159167
134148
141150
100
150
200
250
300
0
100
200
300
400
500
Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18
1 Average net working capital for the quarter / annualized revenue for the quarter.2 (Average inventory for the quarter / annualized cost of sales for the quarter)*365.
Comments on Q1
587 596 579 567 580 588 577 553 561
46%
39%
46%41% 43%
35%38%
35%38%
0%
10%
20%
30%
40%
50%
60%
70%
0
100
200
300
400
500
600
Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18
Free cash flow
[€ m]
Ø Net working capital
[€ m]
Ø Inventory
[€ m]
Net working capital
as a % of sales1
DIO2 in days
Wacker Neuson SE, June 2018
80
100
120
140
160
180
200
220
240
Wacker Neuson SDAX DAX Peergroup
Share & Dividend
14
Our share in 2017 & 2018
Key figures per share
Stable dividend policy (40 – 50% payout ratio)
1 As at June 08, 2018. 2 Peergroup: Atlas Copco, Bauer, Caterpillar, Cramo, Deutz, Haulotte, Manitou, Palfinger, Ramirent, Terex.
%+93% -14%1
2
0.87
1.30
0.940.81
1.25
0.400.50 0.50 0.50
0.60
46%38%
53%62%
48%
-100%
-80%
-60%
-40%
-20%
0%
20%
40%
60%
80%
100%
0
0.5
1
1.5
2
2.5
2013 2014 2015 2016 2017
EPS in € Dividend per share in € (paid out for respective year) Payout ratio
Family 63%
Free float 37%
in € Q1/18 Q1/17
Earnings per share 0.21 0.13
Share price end of period 28.14 21.02
Book value per share 16.02 15.69
Market capitalization (€ m) 1,973.7 1,474.3(total shares: 70,140,000)
Bank TP (€) Recom. Date
Hauck & Aufhäuser 40.00 Buy Jun 08, 18
Metzler 32.00 Buy May 09, 18
Lampe 33.00 Hold May 08, 18
Berenberg 31.00 Hold May 09, 18
Warburg 29.00 Hold May 09, 18
Equinet 27.20 Hold Nov 24, 17
Kepler Cheuvreux 27.00 Hold May 09, 18
Coverage1 Shareholder structure
Wacker Neuson SE, June 2018
Agenda
15
Q1/18
Outlook
Overview
Wacker Neuson SE, June 2018
16
Extension of contracted dealer network for compact and light
equipment
Pro-active relationship management with key account rental
customers and construction companies
Focus on diversification of sales channels and industries
Light equipment established in new retail channels
North American market for skid steers accounts for ~70% of world market
Essential product to be attractive for dealers and rental companies
Large potential for further compact equipment sales
Expansion of plant in Wisconsin & integration of heaters and light towers
from plant in Michigan (closure of plant in 2018)
81,00089,000 91,000
0
25,000
50,000
75,000
100,000
2016 2017 2020e
Skid Steer market North America1
2016 – 2020e (units)
Roadshow Truck, Franklin Equipment.
Wacker Neuson SE, June 2018
Relocation of skid steer production to the US pays off
Skid steer as key product for North American market Development of contracted dealers in North America
1 Source: CECE, Off-Highway.
36,600
43,00045,000
0
10,000
20,000
30,000
40,000
50,000
2017 2018e 2022e
17
New plant located in Pinghu, 30 km from Shanghai city border.
Mini excavators for China and the region, production started in January
Building on local/regional presence Demand for repair and maintenance
of infrastructure is growing, especially in megacities
130,000 qm, 33,000 qm for modern production, offices and logistic facilities
Integration of light equipment production from the Philippines into Pinghu
(closure of plant in 2018)
Wacker Neuson SE, June 2018
Setting the base for further growth in Asia
Successful start of production of mini excavators in Pinghu (China))
Mini excavator market China 2017 – 2022e (units)1
Excavator: EZ17.
1 Source: OHW Report April 2018.
Strategic alliances and partnerships leverage our sales
181 Not in Japan.
2 Commonwealth of Independent States. 3 Kramer “green line” only.
Wacker Neuson produces for Caterpillar1 Kramer3 distributes via JD‘s dealer network
Wacker Neuson via Everdigm‘s network Weidemann via ISEKI‘s network Wacker Neuson via MHE‘s network
HAMM produces for Wacker Neuson
OEM (global)OEM (global1) Distribution (EMENA & CIS2)
OEM (Latin America) Distribution (Korea) Distribution (Japan) Distribution (ASEAN)
Core Markets: Europe & North America
Latin America & Asia
Wacker Neuson SE, June 2018
Randon produces for Wacker Neuson
Strategic alliance with John Deere in EMENA and CIS1
191 Commonwealth of Independent States. 2 Revenues of FY 2016 in USD bn, agricultural sectors only;
3 FY ending October 31, 2016; 4 FY ending September 30, 2016. Source: Annual reports. Wacker Neuson SE, June 2018
John Deere
Kubota
CNH Industrial
AGCO
Claas
SAME Deutz-Fahr
18.5
11.7
10.1
7.4
4.0
1.5
John Deere: Market leader within agricultural machinery2
3
4
9 small and compact wheel loaders 4 telehandlers4 tele wheel
loaders
Start in EMENA & CIS1 (Region 2)
Outlook for 2018
20
Guidance for fiscal 2018 as a whole confirmed
Business index for the construction industry at a high level Business index for the agricultural sector at a high level
Comments
1 Does not include potential one-off income from the sale of a property owned by the Group.
Business index in core industries at a high level
Order intake higher than prior-year figure
Mid-year price increase of 2% on average planned for July 2018
Guidance for fiscal 2018 confirmed
Special risks:
Delayed deliveries (suppliers having difficulties meeting orders)
Currency developments, especially EUR/USD (negative translation
effects on revenue, negative transaction effects on earnings)
1,534
8.6%
5%
7%
9%
11%
13%
15%
0
500
1,000
1,500
2,000
FY 2017 FY 2018
1,650 – 1,700
9.0 – 10.0%1
Source: CECE, May 2018. Source: CEMA, March 2018.
+8 – 11%Revenue
[€ m]
EBIT
margin
47.0
2012 2013 2014 2015 2016 2017
Wacker Neuson SE, June 2018
Agenda
21
Appendix
Wacker Neuson SE, June 2018
22
“Strategy 2022” and mid-term targets
“Strategy 2022” Mid-term targets 2022
Wacker Neuson SE, June 2018
Progress with “Strategy 2022”
23
ACCELERATION
EXCELLENCE
CUSTOMER-CENTRICITY
FOCUS
Expansion of (direct) sales network to include Slovakia1
Optimization and expansion of dealer structure in North America
Progress with financing solutions for customers and distribution
partners
Expansion of rental portfolio to include more flexible solutions tailored
to individual customer needs
R&D focus: Alternative drive technologies, presentation of further zero
emission products at INTERMAT in France (April 2018)
Successful net working capital management, with optimized inventory
structure in particular
Improvements to processes and organizational structure in
aftermarket proving effective
Reduction in structure costs and optimization of value chain:
Integration of light equipment production from Manila
(Philippines) into plant Pinghu (China) underway
Integration of Light equipment production from Norton Shores,
(Michigan, USA) into plant Menomonee Falls (Wisconsin, USA)
underway
Employee development programs
Training initiatives
Profitable business field: Aftermarket & services now an independent
legal entity
Initiatives to enhance delivery capabilities
Internationalization: Successful launch of excavator production in China
Targeted financing for further growth: promissory note in USD
(Schuldschein), new medium-term credit lines
1 Countries with direct sales (120 Wacker Neuson sales and service stations): Germany, Austria,
Switzerland, Poland, Czech Republic, Slovakia, Benelux countries, Denmark, Sweden.Wacker Neuson SE, June 2018
24
Source: Off-Highway Research, August 2017.
Most major regional equipment markets are expected to see growth
in 2018
Europe and Americas main growth drivers
Europe: strong business in the construction sector, upbeat mood
in the agricultural sector
North America: stronger revenue from skid steer loaders and
other compact equipment
Asia-Pacific: a key driver will be China
+11%
+15%
1,000,000
900,000
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
0
2012 2013 2014 2015 2016 2017e 2018e 2019e 2020e 2021e
Tailwind from global markets
Construction industry: 2017–2021 machinery sales +11% Development of agricultural sector in Germany
Wacker Neuson SE, June 2018
Europe India Japan North America RestChina
Price developments for butter & milk in the EU
Source: Nilesen, Milchindustrieverband, Die Welt, 2017.
Source: German Farmer’s association, March 2018.
Fragmented market
Dominated by niche/specialized manufacturers
Not targeted by heavy equipment manufacturers
Quality rather than price
Significant barriers to market entry
Light equipment/
construction
Market structures and dynamics
Fragmented market with local manufacturersCompact equipment/
agriculture
Global competitors
Similar target groups to light equipment for the construction
industry
Specialized manufacturers
Compact and heavy equipment providers
Compact equipment/
construction
Ammann
Atlas Copco/Dynapac
Bomag
Bosch pt
Hilti
Multiquip/Mikasa
Competitors
Giant
JCB
Schaeffer
Thaler
Compact equipment
Atlas Weyhausen
Bobcat (Doosan)
Kubota
Manitou/Gehl
Takeuchi
Yanmar
Heavy equipment
Hitachi
JCB
Komatsu
Liebherr
Terex
Volvo
25
Competitive landscape for Wacker Neuson Group
Wacker Neuson SE, June 2018
26Wacker Neuson SE, June 2018
Challenges: New emission regulations for diesel engines
Engine emissions regulations – lack of harmonization driving costs and consuming resources
27
EZ17e
Wacker Neuson SE, June 2018
Leadership in alternative drive technologies
Financial calendar and contact
28
June 20, 2018 Paris roadshow
June 21, 2018 Warburg Highlights Conference, Hamburg
June 27, 2018 Milan roadshow
June 28, 2018 Lugano roadshow
August 7, 2018 Publication of 2018 half-year report; analysts and investors call
September 24, 2018 Baader Investment Conference, Munich
September 25, 2018 Berenberg and Goldman Sachs Seventh German Corporate Conference, Munich
November 8, 2018 Publication of Q3 report; analysts and investors call
Numerous other conferences and roadshows
Wacker Neuson SE, June 2018
Disclaimer
Cautionary note regarding forward-looking statements
The information contained in this document has not been independently verified and no representation or warranty expressed or implied is made as to, and no reliance should be placed on, the
fairness, accuracy, completeness or correctness of this information or opinions contained herein.
Certain statements contained in this document may be statements of future expectations and other forward looking statements that are based on management‘s current view and assumptions and
involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements.
None of Wacker Neuson SE or any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this
document or its content or otherwise arising in connection with this document.
This document does not constitute an offer or invitation to purchase or subscribe for any securities and neither it nor any part of it shall form the basis of or be relied upon in connection with any
contract or commitment whatsoever.
Contact
Wacker Neuson SE
IR Contact: +49 - (0)89 - 354 02 - 173
www.wackerneusongroup.com