11. Structured FINANCE · 2016 2017 5,0004,760 2018 6,750 2,162 2015 5,835 FY 2015 24,594 18,510...
Transcript of 11. Structured FINANCE · 2016 2017 5,0004,760 2018 6,750 2,162 2015 5,835 FY 2015 24,594 18,510...
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11. Structured FINANCE Funding strategies in emerging markets Ronny Flohr, November 2015
Contents
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DAIMLER GROUP KEY FINANCIAL FIGURES
DAIMLER MÉXICO – AN OVERVIEW
DAIMLER GROUP FUNDING PRINCIPLES
DAIMLER MÉXICO – LOCAL FUNDING
DAIMLER TREASURY ORGANIZATION
Highlights of Q3 2015
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+13%
+18%
+31%
720,000
508,400
€3.7bn
Group unit sales
Highest unit sales so far at Mercedes-Benz Cars
Increase in EBIT from ongoing business
World premiere of the new generation of the Euro VI engine OM 471 for
Mercedes-Benz heavy-duty trucks
Agreement on joint acquisition of HERE digital mapping business together
with Audi AG and BMW Group
Presentation of the new Mercedes-Benz Citaro NGT
World premieres at the IAA 2015 of S-Class Cabriolet, C-Class Coupé and smart cabrio
Daimler Group key financials
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– in billions of EUR –
Q3 2014 Q3 2015
Revenue 33.1 37.3
EBIT as reported 3.7 3.7
EBIT from ongoing business 2.8 3.7
Net profit 2.8 2.4
Earnings per share (in euros) 2.56 2.23
Free cash flow industrial business (January-September) 6.8 4.8
Dec 31, 2014 Sept 30, 2015
Equity ratio - Daimler Group 22.1% 24.1%
Gross liquidity - Daimler Group 16.3 18.4
Equity ratio - Industrial business 40.8% 44.3%
Net liquidity - Industrial business 17.0 19.5
Contents
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DAIMLER GROUP KEY FINANCIAL FIGURES
DAIMLER MÉXICO – AN OVERVIEW
DAIMLER GROUP FUNDING PRINCIPLES
DAIMLER MÉXICO – LOCAL FUNDING
DAIMLER TREASURY ORGANIZATION
Singapore
Melbourne
Pretoria
Tokyo
Sao Paulo
Montvale
Mexico City
Stuttgart Utrecht
AMERICAS in Montvale
Beijing
EMEA in Stuttgart APAC in Singapore
Regional Treasury Centers = Center of Compentence with several countries serviced
Regional Treasury Centers = Center of Compentence with one country serviced
Daimler International Finance
Chennai Bangkok
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Daimler Treasury – the global footprint 3 regional centers and 8 hubs in regulated financial markets with (production) exposure
Daimler Treasury – a process-driven organization
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Regions Europe, Americas, Asia Pacific
Financial Management of Group Companies/
Corporate Finance
Execution
of Strategies & Financial Transactions
Cash Positioning/ Management
Strategic Decision Execution & Decision
within strategic parameters
Central Location: HQ, Stuttgart
Decentral Location: Region
Local Export Credit
Corporate Finance & Asset Liability Management
Market Price Risk & Pension Management
(FX-, CO, Pension Management)
Export Credit & Trade Finance
Treasury Controlling Treasury Settlement
Contents
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DAIMLER GROUP KEY FINANCIAL FIGURES
DAIMLER MÉXICO – AN OVERVIEW
DAIMLER GROUP FUNDING PRINCIPLES
DAIMLER MÉXICO – LOCAL FUNDING
DAIMLER TREASURY ORGANIZATION
Our funding strategy is built on prudent principles
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Targeting
Financial
Independence
No dependence from single markets, instruments, banks or investors
Diversification of funding sources and instruments:
Bank Loans, Bonds, ABS, CP, Deposits
No covenants, no MAC, no asset pledges, no CSAs
Maximizing
Financial
Flexibility Early capital market funding to save credit capacity in growth regions
New markets funded via global and local banks first
Stringent Global
Funding Policy
Liquidity matched funding
Interest rate matched funding
Currency matched funding
Country matched funding
Keeping prudent amount of Cash and Committed Credit Facility
Financial flexibility is key liquidity management tool
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~ 100%
General approach:
Maturities of next 12 months
need to be covered by financial
flexibility*
* Financial flexibility
= Cash
+ Committed Credit Facilities
+ Receivables available for sale (RAFS)
The final size and structure of
the financial flexibility is decided
by ALCO and is the result of a
liquidity risk evaluation process
available
Liquidity
Maturity
Bonds
Acc. Dep.
Bank
Loans
ABS
CP Other
Liqui FS
Liqui IB
Credit
Facility
ABS
Potential
Ensures repayment of maturing debt in case of stress scenarios
Agencies see necessity to support growing FS business with sufficient liquidity
Continuity and reliability define Daimler’s bank relationships
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Deposits
Cash Management
Derivatives
Capital Market Mandates Balance Sheet Support (committed/drawn credit facilities)
Criteria for business allocation:
Execution Capabilities
Competitiveness
Service and Quality
Business allocation is tracked and reviewed on a regular basis
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DAIMLER GROUP KEY FINANCIAL FIGURES
DAIMLER MÉXICO – AN OVERVIEW
DAIMLER GROUP FUNDING PRINCIPLES
DAIMLER MÉXICO – LOCAL FUNDING
DAIMLER TREASURY ORGANIZATION
Three production facilities and a logistic center
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Saltillo Coahuila annual capacity 44,000 units
Monterrey N.L. annual capacity 9,490 units San Luis Potosí, parts distribution center
Santiago Tianguistenco, Edo de México, annual capacity 36,564 units
3. Daimler Vehículos
Comerciales México,
S. de R. L. de C.V.
7.Daimler Servicios
Corporativos,
S. de R.L. de C.V.
11. Daimler Financial
Services, S.A. de C.V.
S.O.F.O.M. E.N.R.
4. Mercedes-Benz
Mexico,
S. de R.L. de C.V.
99%
99%
99% 99% 99%
2. Mercedes-Benz
Desarrollo de Mercados,
S. de R.L. de C.V.
10. Polomex,
S.A. de C.V. 8. Daimler Manufactura,
S.A. de C.V.
26%
Debt issuer
6. DAIPRODCO
México
S. de RL de CV
99.%
1. Daimler México,
S.A. de CV
99%
99.9%
Daimler México Group – corporate structure
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5. Daimler Financial
Services México,
S. de R.L de C.V.
9. Detroit Diesel
Allison, S. de R. L.
de C.V
99%
1 Major shareholder for Daimler Group entities in Mexico.
2 Commercial Vehicles sales entity.
3 Commercial Vehicles manufacturer entity.
4 Mercedes-Benz cars sales entity.
5 Financial Services entity.
6 Dormant company.
7 Service Provider - holds the FS, MB and Daimler Mexico employees.
8 Service Provider holds the Commercial Vehicles employees.
9 Government sales and dealer’s support.
10 Joint venture with Marcopolo to assembly buses.
11 Financial Services entity (specialized in urban bus market).
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YTD Q3 2014 YTD Q3 2015
Revenue 16,390 20,235
EBIT 1,129 1,422
Net Profit 769 820
Daimler Group in Mexico Dec 31, 2014 Sept 31, 2015
Total Debt 24,295 24,594
Equity Ratio of Industrial business* 38.2% 37.9%
Gross Liquidity 2,941 2,656 *Total Assetsl/Equity (Industrial business)
Daimler México Group – key financials – in millions of MXN –
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DAIMLER GROUP KEY FINANCIAL FIGURES
DAIMLER MÉXICO – AN OVERVIEW
DAIMLER GROUP FUNDING PRINCIPLES
DAIMLER MÉXICO – LOCAL FUNDING
DAIMLER TREASURY ORGANIZATION
Daimler México – funding setup
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Targeting
Financial
Independence
Maximizing
Financial
Flexibility Early capital market funding
Global and local banks first
Stringent Global
Funding Policy
Liquidity matched funding
Interest rate matched funding
Currency matched funding
Country matched funding
Cash and Committed Credit Facility
No covenants, no MAC, no asset pledges, no CSAs
Diversification of funding sources and instruments
No dependence from single markets Loans, bonds, CP’s, IC-loans
8 core banks defined
(plus off-shore backups)
100% of core banks under
standard contract
Minimum cash targets applied
Credit facilities doubled
First frequent issuer MTN
program in sector
Closed ALM position in
each portfolio
On-shore MXN funding
Off-shore USD funding
No synthetics in own books
Funding optimization 2012 through 2015 (MXN+USD)
8,878 7,720
2,000
2017 2016
5,000
2018
2,162 6,750
2015
5,835
4,760
FY 2015
24,594
18,510
DMex Group Debt Mix
50%
26%
24%
48% 42%
10%
$14,304
DFSMex Debt Mix
40%
25%
35%
72%
7%
21%
DMex Group Maturity Profile
~45% $18,343
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MXN USD Capital Market IC (=USD) Banks
Dec 2
011
S
ep
2015
– in millions of MXN –
1,725
2012
17,888
12,941 1,823 9,166
FY 2015
14,001
2,064
2014 2013
2,050
2015
~78%
Five strategic adjustments between 2012 and 2015
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1. Alignment of maturity structure
2. Creation of sufficient credit line environment
Setup of contractual framework (8 banks @ 1 standard framework)
Unlocking of required capacities (MXN +9.0bn)
Ensuring utilization rates
3. Implementation of an effective capital market program
Increased flexibility (tripled in size, 18 instruments, three currencies, exchange control regime clause)
Early adopter of frequent issuer option (improved time-to-market)
Improved G&A procedures for legal, audit, regulation and rating
4. Optimization of funding mix
Increase utilization of bonds by MXN 3.0bn
Increase of CP‘s from MXN 1.0bn to MXN 3.0bn
5. Cash management improvements First in-house bank structure in Mexico outside the financial sector implemented
Payment automation projects initiated
Disclaimer
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This document contains forward-looking statements that reflect our current views about future events. The words “anticipate,” “assume,” “believe,”
“estimate,” “expect,” “intend,” “may,” ”can,” “could,” “plan,” “project,” “should” and similar expressions are used to identify forward-looking
statements. These statements are subject to many risks and uncertainties, including an adverse development of global economic conditions, in
particular a decline of demand in our most important markets; a worsening of the sovereign-debt crisis and increasing uncertainty in the euro zone;
an increase in political tension in Eastern Europe; a deterioration of our refinancing possibilities on the credit and financial markets; events of force
majeure including natural disasters, acts of terrorism, political unrest, industrial accidents and their effects on our sales, purchasing, production or
financial services activities; changes in currency exchange rates; a shift in consumer preferences towards smaller, lower-margin vehicles; a possible
lack of acceptance of our products or services which limits our ability to achieve prices and adequately utilize our production capacities; price
increases for fuel or raw materials; disruption of production due to shortages of materials, labor strikes or supplier insolvencies; a decline in resale
prices of used vehicles; the effective implementation of cost-reduction and efficiency-optimization measures; the business outlook for companies in
which we hold a significant equity interest; the successful implementation of strategic cooperations and joint ventures; changes in laws, regulations
and government policies, particularly those relating to vehicle emissions, fuel economy and safety; the resolution of pending government
investigations and the conclusion of pending or threatened future legal proceedings; and other risks and uncertainties, some of which we describe
under the heading “Risk and Opportunity Report” in the current Annual Report. If any of these risks and uncertainties materializes or if the
assumptions underlying any of our forward-looking statements prove to be incorrect, the actual results may be materially different from those we
express or imply by such statements. We do not intend or assume any obligation to update these forward-looking statements since they are based
solely on the circumstances at the date of publication.