full-year 2020 results stadler rail

FULL-YEAR 2020 RESULTSSTADLER RAIL

Peter Spuhler, Executive Chairman and Group CEO a. i., Raphael Widmer, Group CFO

11 March 2021

REPRESENTING STADLER TODAY

Peter Spuhler

Executive Chairman

and Group CEO a. i.

Raphael Widmer

Group CFO

Stadler full-year results 2020 | © Stadler | 11 March 2021 2

Stadler full-year results 2020 | © Stadler | 11 March 2021

AGENDA

Highlights 2020Peter Spuhler, Executive Chairman

and Group CEO a. i.

1

Full-year 2020 financial results Raphael Widmer, Group CFO2

Summary and outlookPeter Spuhler, Executive Chairman

and Group CEO a. i.

3

3

HIGHLIGHTS 2020

WE ARE AN INDUSTRY LEADER

5

>8,500 Stadler trains and locomotives running in 43 countries every day

12 core sites across high- and low-cost countries

~11 % net sales CAGR over the last decade(2)

>200 million kilometres covered every year by vehicles serviced by Stadler

16.1 billion CHF backlog as at 31 December 2020

>12,300 employees(1), including engineering team of over 1,700 employees

5

Notes:

(1) average FTEs 1 January to 31 December.

(2) 2010-2020.


465 vehicles delivered in 2020

549 trains and locomotives ordered in 2020

COMPREHENSIVE PORTFOLIO

Market segments and vehicle families Order backlog contributions 2020

Very High

Speed

High Speed

Intercity

Regional /

Suburban

Not a strategic focus

Loco-

motives

Metro

Main-line

locomotives

Shunting

locomotives

LRV

Metro

Tram /

Tram Train

TypeMarket

segmentVehicle families Reporting segment

Se

rvic

es

& S

ys

tem

s

Ta

ilo

r-m

ad

eRegional markets

Market segmentTrains

Coaches


74%

26%

Rolling Stock

Service & Components

43%

34%

10%

10%

2%

1%

DACH

Western Europe

Americas

CIS

Eastern Europe

Rest of the world

35%

12%9%

12%

26%

6%

LRV

Trains

Metro

Tailor-made

Locomotives



FULL-YEAR 2020 KEY FIGURES

Order intake

CHF X.Xbn

+XX%

Order Backlog

CHF XXbn

+XX%

7

(1) Change year-on-year.

(2) Defined as EBITDA –Capex –Change in NWC. EBITDA is calculated as the sum of EBIT and depreciation and amortization.

Order intake

CHF 4.3bn

-15%(1)

EBIT margin

5.1%

-1 %-pts(1)

Net revenues

CHF 3.1bn

-4%(1)

Order backlog

CHF 16.1bn

+7%(1)

Net profit

CHF 138.4m

+8%(1)

Free Cash Flow(2)

CHF -458.9m

-CHF 130.0m(1)

Vehicles delivered

465

+5%(1)

COVID-19 IMPACT


– Interruptions to internal and external supply chains

– Travel restrictions affecting Stadler employees, homologation

officials and customers which impacts final payments

– All plants currently operating at largely normal levels

Impact on

Operations

– Demand remaining strong, no order cancelations and no

large tenders lost

– Ongoing tenders largely on track but some final decisions

postponed due to Covid-19 and appeals by competitors

– New tenders being launched

Market

environment

– Health and safety measures initiated immediately

– Adapting assembly sequences and working shift times with

employees partially working remotely

– Decentralised supply chain

Counter

measures

– Partial recovery of deferred revenues achieved in H2 2020

– Adverse effect on net working capital

– Service & Components impacted by lower mileage

– Significant order backlog and resilient end market

Financial

impact

ORDER INTAKE HIGHLIGHTS 2020


− 42 METRO trains, a new

maintenance plant and a 35-year

service contract

− Valued at c. GBP 700m

Tyne & Wear Metro

Framework agreement for up to

1,500 METRO cars valued at up to

EUR 3.0bn

First call-off for 606 cars including

spare parts amounts to EUR 1.2bn

Metro Berlin

MGB ordered 12 out of 27 new

«ORION» trains for c. CHF 150m

20 “Capricorn” trains worth CHF

170m in an option call-off from RhB

Eight New tailor-made trains for the

Centovalli railway

Tailor Made

LRVs

Mainline Signalling

Up to 80 TRAMLINK for Milan (EUR

172.6m). Firm order for 30 trams

24 TRAMLINK for Jenaer

Nahverkehr (EUR 92m), with option

for up to 19 additional vehicles

21 additional KISS trains ordered

by the Hungarian Railways for over

EUR 300m

Twelve more KISS trains for Mälab

for over CHF 130m

Full homologation for GUARDIA

European Train Control System

First ETCS refit contract for Stadler

won in the Netherlands

First urban mass transit signalling

system awarded (MARTA)


SIGNALLING: ACHIEVEMENTS 2020 AND

OUTLOOK

Milestones in 2020 Outlook

Stadler is delivering across all signalling market segments

(1) Communication Based Train Control

(2) Derived from Stadler’s full CBTC solution

(3) European Train Control System

(4) Automatic Train Operation

Stadler in dialogue with several

European metro operators

Homologation in 10 countries

until 2022 expected

Retrofit market potential

Increasing demand for ATO in

numerous tenders

First urban mass transit signalling

system awarded to Stadler: Supplying a

CBTC-like train control system(2) on the

new Stadler vehicles for MARTA (Atlanta,

USA)

CBTC(1)

Homologation in Switzerland and Poland

Homologation under way in Hungary,

Slovenia, Italy, and Germany

ETCS(3)

First automatically operated train ride with

passengers in the Netherlands – achieved

by using the Stadler ATO

ATO(4)

3

7

3

9

10

2

8

12

By segment

Stadler’s strategic markets

11

OEM

2019(1) market size (€Bn) 54 35 27

Global rolling stock

OEM market

Targeted market

segments Targeted regions

12

3

3

6

4

2

1

4

89

7

2

By region By segment

Ro

llin

g S

toc

k

Europe

North

America

CIS

RoW

East

Asia(3)

1 2 3

+2.3%

+4.7%

+4.4%

+2.2%

+3.6%

+1.7%

Ho

me

-

ma

rke

ts

Op

po

rtu

nis

tic

ma

rke

ts

Service

System

Technology4)

~7

~18

+2.8%

+1.0% (5))

Freight

Cars

VHS(2)

HS

Metro

Coaches

LRV

Locomotives

MU HS

Metro

Coaches

LRV

Locomotives

MU

Source: SCI (2020).

Market volumes based on € value of equipment and services delivered.

(1) 2019 market size defined as average of 2018-2020, 2014 defined as 2013-2015 average and 2024 defined as 2023-2025 average.

(2) Very High Speed trains (VHS) defined as trains with top speed above 251km/h.

(3) East Asia defined as China + South Korea + Japan. Rest of the World (RoW) includes Asia (excluding East Asia), South and Central America, Middle East and Africa.

(4) System Technology includes Control, Command and Signalling (CCS) and Passenger Information Technology (PIT); excluding East Asia.

(5) Expected CAGR 2019-2024 for western Europe: +2.2%.

2014-19(1) CAGR

2019-24(1) CAGR

2019-241)

CAGR

2019-241)

CAGR

MARKET OUTLOOKTOTAL OEM AND TARGETED MARKETS 2020 VIEW

South-

east Asia

Global rolling stock

OEM market1


12

COMPETITIVE LANDSCAPEMARKET SHARE BY REGION

Home markets Opportunistic markets

Source: SCI (2020), SCI marketstudy Worldwide Market for Railway Industries 2020.

Market share based on delivered units in 2019 (average 2018-2020). High Speed (HS) 200 to 250 km/h.

*(2018 values)

North America: EUR 2.6 bn Europe: EUR 11.9 bn CIS: EUR 4.2 bn

RoW: EUR 8.0 bn Southeast Asia: EUR 0.6 bn

3% 12%

13%

8%

47%

12% HS

Metro

Coaches

LRV

Locomotives

MU

12%

26%

16%

39%

7%

21%

44%

6% 11%

19%

22%

30%

3%

20%

25%

10% 4% 2%

64%

10%

Opportunistische Märkte

Market leaders: CRRC (31%), Bombardier & ICF (9%

each), TMH (8%), Alstom (7%) followed by Siemens and

Stadler (4% each).Stadler is particularly strong in Europe (No. 3).


28%

16%

15%

13%

6%

5%

17% Bombardier

Alstom

Stadler (15%)

Other

Siemens

Hitachi Rail

CAF

71%

2%

TMH

13%

Alstom

Sinara

2%Siemens 1%

Stadler (2%)

11%

Other

37%

12%

23%

GE / Wabtec

Bombardier

Kawasaki CRRC10%

Progress Rail 7%

Stadler (1%*) 4%7%

Other

34%21%

27%

CRRC

Industri Kereta Api

8%

4%

Vietnam Railways

Hyundai Rotem

6%

Hitachi Rail

Other

50%

22%

5%

15%

CRRC

Hyundai Rotem

Alstom

ICF

5%Modern Coach Factory

3%

Other

2018: Stadler 1%

13

COMPETITIVE LANDSCAPEGLOBAL MARKET SHARE BY SEGMENT

On the basis of Global market

excl. China, South Korea and Japan



Excluding Coaches .

67%6%

6%

Stadler (3%)

CRRC

Other

1%

Alstom

4%Hyundai Rotem

4%Bombardier

TMH

12%

55%

12%

8%

8%

8%Hitachi Rail

CRRC

Bombardier

Stadler (6%)

Alstom

Siemens

6%2%

Other

13%

12%

9%9%

41%

BombardierOther

6%

Alstom

CRRC

10%

CAF

TMH

Stadler (9%)

18%

12%

11%6%

5%

34%

Bombardier

15%

TMH

CRRC

ICF

Other

Alstom

Stadler (17%)

25%

17%

10%9%

9%

5%

17%TMH

CRRC

Siemens

Sinara

GE / Wabtec

1%

8%

CLW

DLW

Stadler (1%)

Other

LRV: EUR 2.6 bnMetro: EUR 9.2 bn HS: EUR 2.4 bn

EMU/DMU: EUR 9.8 bn Locomotives: EUR 7.2 bnFocus segments

64%

2% 9% 1%

23%

23%

10%

29%

0%

38%

21%

23%

11%

9%

36%

62%

17%

9% 0% 11%

100%

RoW

Europe

CIS

North America

Southeast

Asia

Stadler is strong in EMU/DMU segment.Global potential in Locomotives, Metro, LRV und

High Speed segments.


14

Home markets

COMPETITIVE LANDSCAPEMARKET SHARE EUROPE BY SEGMENT



25%

23%19%

15%

9%

AlstomConsortium AL-BT

Siemens

3%

Bombardier

Hitachi Rail

Other

6%

Stadler (7%)

18%

16%

14%12%

30%

Bombardier

Stadler (15%)

Other

CAF

Skoda

10%

Alstom

38%

22%

15%

9%

7%

9%

BombardierSiemens

Stadler (22%)

Other

Alstom

CAF

41%

23%CZ Loko

Siemens

Bombardier

7%

6%Vossloh5%

Newag 4%

Alstom

Stadler (2%)

5%

10%

Other

EMU/DMU: CHF 5.5 bn

LRV: EUR 1.5 bn

Metro: CHF 0.9 bn

Locomotives: CHF 1.5 bn

Highspeed: CHF 2.1 bn

Focus segments

Stadler improved its position in LRV to No. 2.Compared to the previous year, Stadler won 2%

market share in Locomotives.


26%

18%

16%

11%

9%9%

Alstom

Other

Hyundai Rotem

Stadler (9%)

Bombardier

Hitachi Rail

11%

Siemens

FULL-YEAR 2020 FINANCIAL RESULTS

FULL-YEAR RESULTS 2020 SUMMARYCHFm

Order intake Net revenuesOrder backlog

EBIT Capital expenditure(2)

2019 2020

5’1174’332

-15%

16’106

31.12.2019 31.12.2020

15’026

+7.2%

2020

3’085

2019

3’201

-3.6%

194

156

6.1% 5.1%

2019 2020

-19%

EBIT as % of net revenues

27

450

31.12.2019 31.12.2020

+ CHF 423m


Change year-on-year

Net working capital(1)

(1) Net working capital is calculated by subtracting the sum of trade payables, liabilities from work in progress and other current liabilities (including other current liabilities, current provisions and deferred income and accrued

expenses) from the sum of trade receivables, inventories, work in progress and other current assets (including other current receivables, compensation claims from work in progress and accrued income and deferred expenses).

(2) Capital expenditure is calculated as the sum of investments in tangible and intangible assets.

249288

20202019

+16%

Rolling Stock

Major orders in DACH region (BVG Metro Berlin, Germany) and Western Europe (Nexus, UK)

Large Tailor Made orders in Switzerland: a new order from Matterhorn Gotthard Bahn (MGB) and

an option call-off by Rhaetian Railway (RhB)


Strong order intake mainly driven by two long-term service contracts in connection with the

Rolling Stock orders from BVG, Germany, and Nexus, UK

Comments


ORDER INTAKECHFm

833

2020

4’284

1’456

2019

2’875

5’117

4’332

-15%

17

17%

53%42%

16%

31%

17%

2019 2020

8%

14%

2%

DACH

Western Europe

Eastern Europe

Americas

Others(1)

(1) Others: CIS and rest of the world.

Rolling Stock Service & Components

+75%

-33%


ORDER BACKLOG BY REPORTING SEGMENTCHFbn

18

Order backlog of 16.1bn with a growing Service & Components share

31.12.2017

8.5

0.8

2.3

31.12.2016

9.0

2.0

10.9

31.12.2018

12.3

13.2 2.8

11.0

31.12.2019

16.1

12.0

4.1

31.12.2020

9.3

15.0+15% CAGR


9%

% Share of Service & Components

17%

18%

18% 26%


ORDER BACKLOG BY PRODUCT SEGMENT

19

High quality and increasingly diversified order backlog

Executing on

strategic focus

31 Dec 202031 Dec 2019

50%

6%

8%

7%

11%

18%

Trains

Locomotives

Metro

Tailor-made

LRV


35%

6%

12%9%

12%

26%


NET REVENUESCHFm

789

H1 2019

146

1’002

148

113

H1 2020 H2 2019

1’938 1’953

2’150

197

H2 2020

1’115935

2’086

-16%

+3.1%

20

Rolling Stock

Partial recovery of Covid-related delays with revenues up year-on-year in the second half

Revenues in the full-year only declined slightly

Corona-related supply chain disruptions and delays in homologation processes and final vehicle

takeovers by customers due to travel restrictions


Revenue growth below expectations as a result of lower frequencies in public rail transport and

hence less revenues from mileage of vehicles in service. Less sales of spare parts and repairs

Comments


261343

2’940

2019

2’742

2020

3’2013’085

-3.6%

+32%

-6.7%


EBITCHFm

21

Rolling Stock

Corona-related delays led to a decline in revenues in the first half. Profitability impacted by

lower volumes, supply chain disruptions and implementation of health and safety measures

Significant margin recovery in the second half of 2020 to H2 2019 levels

Adverse NOK/CHF impact of ~CHF 30m on EBIT from last remaining option call-off


− High-margin service business impacted by lower fixed cost absorption due to revenues below

expectations as a result of less mileage of vehicles in service and spare parts sales

Comments

194

5

151 156

6.1%

0.5%

7.0%

5.1%

0%

5%

10%

15%

0

50

100

150

200

250

2019 H2 2020H1 2020 2020

-19%

EBIT EBIT in % of net revenues


NET INCOME

22

− Net income increased compared to the previous year

− Mainly impacted by favourable currency exchange rate effects on balance sheet, lower bank

guarantee costs, and tax effects

Comments

CHFm

Earnings before interest and taxes (EBIT)

2019 2020 Change YOY

193.7 156.1 (19%)

Financial result (47.1) (3.1)

Share of results from associates 4.0 2.8

Ordinary result 150.6 155.8 3.5%

Non-operating result (2.1) (1.2)

Profit before income taxes 148.5 154.7 4.1%

Income taxes (20.0) (16.3)

Profit for the period 128.5 138.4 7.7%

thereof attributable to

- Shareholders of Stadler Rail AG 127.2 137.6

- Non-controlling interests 1.4 0.8

Decline in net cash position mainly a result of deferred homologation, customer acceptance and

final invoicing of new vehicles

Significant growth investments

Continuous ramp-up of production and work in progress

Additional project financing facilities

Comments


NET CASH POSITIONCHFm

753929

-468 -534

-279

-1’003

Non-current financial liabilities

31.12.2019

-608

31.12.2020

Cash and cash equivalents

Current financial liabilities

6


NET WORKING CAPITALNet working capital(1) (CHFm)

179232 201

818 862

286301

-804

-317

-250

-298

-386

-478

Comp. claims from WIP

132 Other current assets

Trade receivables

31.12.2019 31.12.2020

Inventories

Work in progress (net)

Trade payables

Other current liabilities

27450

(1) Net working capital is calculated by subtracting the sum of trade payables, liabilities from work in progress and other current liabilities (including other current liabilities, current provisions and deferred income and accrued

expenses) from the sum of trade receivables, inventories, work in progress and other current assets (including other current receivables, compensation claims from work in progress and accrued income and deferred expenses).

27

450

44

486

47

(31)

31

.12

.201

9

15

Tra

de

rece

iva

ble

s

Oth

er

cu

rre

nt a

sse

ts

Com

p. cla

ims fro

m W

IP

Work

in p

rogre

ss (

ne

t)

Inve

nto

rie

s

(48)

Tra

de

pa

ya

ble

s

(91)

Oth

er

cu

rre

nt lia

bili

ties

31

.12

.202

0

Covid impacts led to bottlenecks in homologation, deliveries, and final customer acceptance

Largely finished but not yet delivered vehicles remain in work in progress which drives growth in

net working capital and ties up cash

Comments


CAPITAL EXPENDITURECHFm

4865

174

213231

35

57

14

8

2016

11

202020182017 2019

55

76

188

248

288

Investments in intangible assetsInvestments in tangible assets

Over EUR40m invested in capacity expansion in Germany related to a framework contract for

the delivery of up to 1,500 METRO cars for Berlin. Capacity additions in Hungary (CHF40m).

Circa CHF37m invested in equipment and land at recently opened manufacturing site in

St. Margrethen, Switzerland

Investments in intangible assets mainly relate to development of new high-speed SMILE vehicle

concept, new products in locomotives and signalling

Comments

OUTLOOK: CLEAR STRATEGY FOR BRINGING

STADLER TO THE NEXT LEVEL

WE HAVE A CLEAR STRATEGY FOR BRINGING

STADLER TO THE NEXT LEVEL


Europe

North America

CIS

New markets

• Market segments

unchanged

• Deliver on

backlog and

establish next

sales level

• Growth through

new product

pipeline

Rolling Stock

• Growing

accessible market

and installed base

• New service

solutions

• Capture

opportunities

from signalling

• Potential selective

acquisitions

Service &

Components

• Establish own

signalling

solutions

• AngelStar JV with

Mermec

• Potential

opportunistic

acquisitions

Signalling

Rolling Stock


Stadler sales 2018

Rolling Stock


Signalling

Stadler strategy 2023

Reg

ion

s

Strategic focus

Note: Sizes of pie charts are illustrative only.

ADDITIONAL GROWTH POTENTIAL DUE TO

GOVERNMENT SUPPORTED PROGRAMS


Supportive mega trends Rail as a structural beneficiary of government stimulus

Green transportation with low

carbon emission

Urbanisation combined with

stronger connectivity between

cities

Increased investments in

infrastructure

Short-term emergency funding combined with long-term investment plans

Connecting Europe – €24bn for transport until 2020

EU Green Deal – €1trn funding in total over 2021-2027

EU Recovery Plan – €1.85trn with Rail share of €40bn+ until 2027

Rail modernization – €86bn over the next decade

€5.5bn injection into Deutsche Bahn

Plan de reliance – €4.7bn to rail (of which €3bn into Signalling) and

€1.2bn to daily transport

Network Rail’s Infrastructure Enhancement – £9.4bn until 2024

COVID-19 rescue package – £3.5bn approved for rail operators

Surface transportation bill – $60bn allocated to Rail

American Rescue Plan Act of 2021 – $30.5bn in emergency funding

for public transport

Between CHF 4.0bn and 5.0bn

Above 6 %


FY 2021 FINANCIAL GUIDANCE

Order intake

EBIT-margin

Our 2021 financial guidance is based on the assumption that the effects of the

COVID-19 pandemic will soon normalise and at constant currency exchange rates.

Payout ratio of c. 60% of net incomeDividend

Capex of around CHF 200m

Positive Free Cash FlowCapex / FCF

Between CHF 3.5bn and 3.8bnNet revenues

8 to 9% from 2023 onwards


MID-TERM FINANCIAL GUIDANCE

EBIT-margin

Our 2021 financial guidance is based on the assumption that the effects of the

COVID-19 pandemic will soon normalise and at constant currency exchange rates.

Payout ratio of c. 60% of net incomeDividend

THANK YOU!


REPORTING SEGMENTS

(1) average FTEs 1 January to 31 December

Rolling Stock


CHFm 2019 2020 Change

Order intake 4’284 2’875 -33%

Order backlog 12’254 11’996 -2%

Net revenues (third party) 2’940 2’742 -7%

Additions to fixed assets 186 184 -1%

Total staff as FTEs 8’408 9’111 8%(1)

CHFm 2019 2020 Change

Order intake 833 1’456 75%

Order backlog 2’772 4’110 48%

Net revenues (third party) 261 343 32%

Additions to fixed assets 35 67 91%

Total staff as FTEs 2’326 3’011 29%(1)


INFORMATION

Share information

Listing: SIX Swiss Exchange

Currency: CHF

Ticker symbol: SRAIL

ISIN: CH0002178181

Listing date: 12 April 2019

Financial calendar

06 May 2021: Annual General Meeting

25 August 2021: Publication of half-year results 2021

Investor contact

Daniel Strickler

Investor Relations Officer

Phone: +41 71 626 86 47

E-mail: [email protected]

33

Media contact

Andreas Petrosino

Deputy Head of Communications & PR

Phone: +41 71 626 19 19

E-mail: [email protected]

DISCLAIMER

34

IMPORTANT NOTICE

This presentation (the "Presentation") has been prepared by Stadler Rail AG ("Stadler" and together with its subsidiaries, "we", "us" or the "Group") and includes forward-looking

information and statements concerning the outlook for our business. These statements are based on current expectations, estimates and projections about the factors that may

affect our future performance, including global economic conditions, and the economic conditions of the regions and markets in which the Group operates. These expectations,

estimates and projections are generally identifiable by statements containing words such as “expects,” “believes,” “estimates,” “targets,” “plans,” “outlook” or similar expressions.

There are numerous risks and uncertainties, many of which are beyond our control, that could cause our actual results to differ materially from the forward- looking information

and statements made in this Presentation, which, in turn, could affect our ability to achieve our stated targets. The important factors that could cause such differences include:

changes in the markets the Group serves, including as a result of changes in the global demand for transportation and demographic changes; the Group's ability to successfully

develop, launch and market new products and services; the Group's ability to retain existing customers and/or secure new customers; the Group's ability to compete with existing

and new competitors; the Group's ability to maintain the high quality, reliability, performance and timely delivery of its products and services; the impact of fluctuations in foreign

exchange rates; and such other factors as may be discussed from time to time. Although we believe that our expectations reflected in any such forward-looking statement are

based upon reasonable assumptions, we can give no assurance that those expectations will be achieved.

PRESENTATION OF FINANCIAL INFORMATION

This Presentation has been prepared by Stadler solely for informational purposes. Certain financial data contained herein is based on historical financial information of Stadler

that has been prepared in accordance with the accounting standards of Swiss GAAP FER, unless otherwise stated. In addition, certain financial data included in the Presentation

consists of "non-Swiss GAAP financial measures". These non-Swiss GAAP financial measures may not be comparable to similarly titled measures presented by other companies,

nor should they be construed as an alternative to other financial measures determined in accordance with Swiss GAAP. You are cautioned not to place undue reliance on any

non-Swiss GAAP financial measures and ratios included herein.

In addition, certain financial information contained herein has not been audited, confirmed or otherwise covered by a report by independent auditors and, as such, actual data

could vary, possible significantly, from the data set forth herein.

THIS PRESENTATION IS NOT AN INVITATION TO PURCHASE SECURITIES OF STADLER OR THE GROUP.


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