Atlas Copco Q4-2011 results handout

Atlas Copco Group

Q4 2011 results

January 31, 2012

Q4 - highlights

Overall demand at a high level– Solid development in manufacturing and mining business

– Weakening demand for some types of equipment

– Strong growth in aftermarket

Record revenues

Increased operational investments and acquisitions

Proposed dividend of SEK 5.00 (4.00) per share, totaling MSEK 6 058

January 31, 20122

Q4 - figures in summary

Orders received of MSEK 21 927 (19 374), 14% organic growth

Revenues of MSEK 22 290 (19 401), 16% organic growth

Operating profit increased by 15% to MSEK 4 596– Adjusted margin at 21.7% (21.6)

Restructuring costs of MSEK 125 in Corporate and in Construction Technique Negative effect of MSEK 116 (177) from share-related long-term incentive programs

Profit before tax at MSEK 4 436 (3 920)– MSEK 43 capital gain related to sale of all remaining shares in RSC Holdings

Basic earnings per share SEK 2.78 (2.39)

Operating cash flow at MSEK 1 574 (2 529)

January 31, 20123

A B C

Orders received - local currency

January 31, 20124

Group total +24% YTD, +16% last 3 monthsStructural change +2% YTD, +2% last 3 months

December 2011

19 +37 +19

10 +16 +22

31 +19 +13

11 +29 +1

22 +23 +14

7 +23 +63

A = Share of orders received, year-to-date, %

B = Year-to-date vs. previous year, %

C = Last 3 months vs. previous year, %

Q4 - Americas

Good demand in North America– Increased order intake in all business areas

Record high for Industrial Technique and Construction Technique


Strong South America– Mining and manufacturing growth drivers

– Demand from the construction industry remained weak

January 31, 20125

A B C

December 2011 A = Share of orders received, year-to-date, %



19 +37 +19

10 +16 +22

Q4 - Europe and Africa/Middle East

Stable demand in Europe compared to Q3– Strong development in northern Europe, weak in the south

– Orders for mining and civil engineering increased

Healthy demand in in Africa / Middle East

January 31, 20126

A B C




31 +19 +13

11 +29 +1

Q4 - Asia and Australia

High order intake in Asia– Strong demand, except for some types of

construction equipment

– Continued strong growth in aftermarket

Record orders received in Australia– Several sizeable orders from the mining industry

– Strong aftermarket

January 31, 20127

A B C




22 +23 +14

7 +23 +63

-40

-30

-20

-10

0

10

20

30

40

00

Q1

00

Q2

00

Q3

00

Q4

01

Q1

01

Q2

01

Q3

01

Q4

02

Q1

02

Q2

02

Q3

02

Q4

03

Q1

03

Q2

03

Q3

03

Q4

04

Q1

04

Q2

04

Q3

04

Q4

05

Q1

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Q2

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Q3

05

Q4

06

Q1

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Q2

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Q3

06

Q4

07

Q1

07

Q2

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Q3

07

Q4

08

Q1

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Q2

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Q3

08

Q4

09

Q1

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Q2

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Q3

09

Q4

10

Q1

10

Q2

10

Q3

10

Q4

11

Q1

11

Q2

11

Q3

11

Q4

Order cancellations, % Organic growth, %

Organic* growth per quarter

Change in orders received in % vs. same quarter previous year

January 31, 20128

Atlas Copco Group, continuing operations

*Volume and price

Atlas Copco Group – sales bridge

January 31, 20129

Orders Orders MSEK received Revenues received Revenues2010 19 374 19 401 75 178 69 875Structural change, % 2 3 2 2Currency, % -3 -4 -8 -8Price, % 2 2 2 2Volume, % 12 14 20 20Total, % 13 15 16 162011 21 927 22 290 86 955 81 203

October - December January - December

Atlas Copco Group

January 31, 201210

2011

CompressorTechnique39%

Industrial Technique

9%

ConstructionTechnique

36%

Revenues per business area

Mining and Rock ExcavationTechnique

16%

Compressor Technique

Healthy demand for industrial compressors and aftermarket

– 12% organic order growth

Record revenues and operating profit– Solid operating margin at 23.3% (24.9)

New factory in China

Acquisitions in China and the United States

Quality Air division created

January 31, 201211

-15

-10

-5

0

5

10

15

20

25

-15

-10

-5

+0

+5

+10

+15

+20

+25

2009 2010 11 Q1 11 Q2 11 Q3 11 Q4

Organic* revenue growth: Change vs. same period previous year, %

Operating margin, %

Industrial Technique

26% organic order growth– Strong demand from the motor vehicle

industry in all major markets

– Positive development in the aftermarket

Record revenues and operating profit– Operating margin at 23.6% (21.9)

Acquisitions in new technologies

January 31, 201212

-40

-30

-20

-10

0

10

20

30

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-40

-30

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+0

+10

+20

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2009 2010 11 Q1 11 Q2 11 Q3 11 Q4


Operating margin, %

-30

-20

-10

0

10

20

30

40

50

-30

-20

-10

+0

+10

+20

+30

+40

+50

2009 2010 11 Q1 11 Q2 11 Q3 11 Q4


Operating margin, %

Mining and Rock Excavation Technique

Continued high mining demand– 21% organic order growth and record

orders received


Record revenues and operating profit– Operating margin at 25.1% (23.5)

Acquisitions in presence and new products

January 31, 201213

-20

-15

-10

-5

0

5

10

15

20

-40

-30

-20

-10

+0

+10

+20

+30

+40

2009 2010 11 Q1 11 Q2 11 Q3 11 Q4


Operating margin, %

Construction Technique

Weak demand– Orders received -9%, organically

– Orders particularly low for road construction equipment

– Favorable aftermarket development

Operating margin was 4.1% (10.5)– Affected by low production volumes and

restructuring costs of MSEK 75

– Adjusted operating margin 6.6%

January 31, 201214

Group total

January 31, 201215

MSEK 2011 2010 %

Orders received 21 927 19 374 13%

Revenues 22 290 19 401 15%

Operating profit 4 596 4 007 15%

– as a percentage of revenues 20.6 20.7

Profit before tax 4 436 3 920 13%

– as a percentage of revenues 19.9 20.2

Profit for the period 3 372 2 916 16%

Basic earnings per share, SEK 2.78 2.39

Return on capital employed, % 37 29

October - December

October – December 2011 vs. 2010

Profit bridge

January 31, 201216


Q4 2011 Organic Growth Currency One-time items Q4 2010MSEK Price/Volume Acq./Div.Atlas Copco GroupRevenues 22 290 3 094 -745 540 19 401EBIT 4 596 894 -230 -75 4 007% 20.6% 28.9% 20.7%

Profit bridge – by business area

January 31, 201217


Q4 2011 Organic Growth Currency One-time items Q4 2010MSEK Price/Volume Acq./Div.Compressor TechniqueRevenues 8 831 912 -320 100 8 139EBIT 2 061 110 -65 -10 2 026% 23.3% 12.1% 24.9%Industrial TechniqueRevenues 2 437 352 -70 270 1 885EBIT 576 128 -30 65 413% 23.6% 36.4% 21.9%Mining and Rock Excavation TechniqueRevenues 8 204 1 966 -325 0 6 563EBIT 2 059 665 -150 0 1 544% 25.1% 33.8% 23.5%Construction TechniqueRevenues 2 964 -108 -25 175 2 922EBIT 122 -91 -15 -80 308% 4.1% 84.3% 10.5%

Balance sheet

January 31, 201218

MSEK

Intangible assets 15 352 20.4% 13 464 18.8% 12 916 17.1%Rental equipment 2 117 2.8% 1 843 2.6% 2 282 3.0%Other property, plant and equipment 6 538 8.7% 5 702 8.0% 6 353 8.4%Other non-current assets 3 983 5.3% 4 123 5.8% 7 977 10.6%Inventories 17 579 23.4% 12 939 18.1% 17 106 22.7%Receivables 21 996 29.3% 17 474 24.4% 21 603 28.7%Current financial assets 1 773 2.4% 1 734 2.4% 1 659 2.2%Cash and cash equivalents 5 716 7.6% 14 264 19.9% 5 455 7.2%Assets classified as held for sale 55 0.1% 79 0.1% 43 0.1%TOTAL ASSETS 75 109 71 622 75 394

Total equity 28 839 38.4% 29 321 40.9% 23 768 31.5%Interest-bearing liabilities 21 939 29.2% 21 692 30.3% 30 404 40.3%Non-interest-bearing liabilities 24 331 32.4% 20 609 28.8% 21 222 28.1%TOTAL EQUITY AND LIABILITIES 75 109 71 622 75 394

Dec. 31, 2011 Dec. 31, 2010 Dec. 31, 2008

Capital structure

19January 31, 2012

Net Debt*/EBITDA

* Net Debt adjusted for the fair value of interest rate swaps

1.43

1.24

1.44 1.421.37

1.27

1.48

1.18

0.94

0.82 0.84

0.57

0.340.29

0.83

0.73 0.71

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

2007 2008Q1

2008Q2

2008Q3

2008 2009Q1

2009Q2

2009Q3

2009 2010Q1

2010Q2

2010Q3

2010 2011Q1

2011Q2

2011Q3

2011

Net Debt/EBITDA

Cash flow

January 31, 201220

MSEK 2011 2010 2011 2010Operating cash surplus 5 199 4 784 19 906 16 673 of which depreciation added back 703 664 2 522 2 498Net financial items and taxes received/paid -1 280 -1 390 -4 582 -3 773Change in working capital -1 371 -643 -6 115 -1 730Increase in rental equipment, net -126 -71 -788 -345Cash flows from operating activities 2 422 2 680 8 421 10 825Investments of property, plant & eq., net -536 -208 -1 676 -815Other investments, net -109 209 154 195Cash flow from investments -203 -152 -607 -507Operating cash flow 1 574 2 529 6 292 9 698Company acquisitions/ divestments -1 582 -23 -2 206 -1 691

October - December January - December

2011 – A fantastic year

Strong demand development

Continued investments in market presence, new technologies and new products, product development and production capacity

Record4

– Order intake increased to MSEK 86 955, a 22% organic increase

– Revenues up 16% to MSEK 81 203, a 22% organic increase

– Operating profit up 26% to MSEK 17 560

– Operating margin of 21.6%

Operating cash flow of MSEK 6 292 (9 698)

Proposed dividend of SEK 5.00 (4.00) per share

21January 31, 2012

Revenues and operating profit

0

2 000

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2007 2008 2009 2010 2011

Operating profit, MSEK

MSEK

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2007 2008 2009 2010 2011

Revenues, MSEK Operating margin, %

MSE %

January 31, 2012

Atlas Copco Group

January 31, 201223

Earnings per Share, Dividend and Redemption

0.96 1.25 1.50 2.13 2.38 3.00 3.00 3.00 4.00 5.00

4.84

22.38

9.00

2.32 2.61

3.71

5.22

12.24

6.09

8.33

5.14

8.16

10.68

0

5

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15

20

25

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011*

Earnings per share Dividend per share Dividend + redemption per share

* Proposed by the Board of Directors

Near-term outlook

The overall demand for Atlas Copco’s products and services is expected to weaken somewhat from the current high level.

January 31, 201224

Committed tosustainable productivity.

January 31, 201226

Atlas Copco Q4-2011 results handout

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Transcript of Atlas Copco Q4-2011 results handout