Haulotte : 2020 HY Results

2020 Half-year results Outlook

September 9th, 2020

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Index

1. Impact of standards IAS 29 & IFRS 16 (*)

1. 2020 half-year: sales and results

1. Recent activity and outlook

(*) IAS 29 :hyperinflation in Argentina , IFRS 16 : new leases standard

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I.

Impact of standards IAS 29 and IFRS 16 (*)

(Period from 01.01.20 to 30.06.20)

(*) IAS 29 : hyperinflation in Argentina

IFRS 16 : new leases standard

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Global income statement

		A			B		C		A-B-C
in € Million (excluding IAS 29 & excluding		Global		IAS 29	IFRS 16	Excluding IAS 29 & excluding IFRS 16
IFRS 16)
	H1 2020	H1 2019	Var.	H1 2020		H1 2019	H1 2020		H1 2019	H1 2020	H1 2019	Var.
Net sales	222,4	342,7	-35%	(0,3)		0,1	-		-	222,7	342,6	-35%
Current Operating Income excl. FX	5,5	23,9	-77%	-		(0,2)	0,3		0,3	5,2	23,8	-78%
gains & losses
2,5%	7,0%								2,3%	6,9%
Operating Income	3,5	20,9	-83%	0,1		(0,2)	0,3		0,3	3,1	20,8	-85%
	1,6%	6,1%								1,4%	6,1%
Income before tax	(8,2)	21,6	-138%	0,9		1,0	(0,2)		(0,1)	(8,9)	20,7	-143%
	-3,7%	6,3%								-4,0%	6,0%
Consolidated Net Result	(8,7)	18,3	-148%	0,9		1,0	(0,2)		(0,1)	(9,4)	17,4	-154%
	-3,9%	5,3%								-4,2%	5,1%

• IAS 29 : hyperinflation in Argentina
• IFRS 16 : new leases standard

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II.

2020 half-year: sales and results

(Period from 01.01.20 to 30.06.20)

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MAIN FACTS

H1 2020

The health crisis due to Covid-19

• The vast majority of the Group's activities impacted by the pandemic.

1. Industry :
2. • Closing of the Chinese factory on January 20th, 2020 - Progressive reopening from February 13th.
   • Closing of the 3 french factories on March 20th, 2020 - Progressive reopening from April 20th, 2020.
   • North-American& Romanian factories did not close but adapted their pace to the level of activity.

1. Distribution & renting :
2. • Progressive closing and reopening of distribution subsidiaries following the virus evolution.
   • Maintain technical hotlines and delivery of spare parts.
   • At the peak of the crisis, 80% of staff on teleworking or partial lay-off.

• 1. Corporate :
  2. • 100% of the staffs placed on teleworking in 24h.
     • Teams' return on-site since May 11th, 2020.
     • Implemented partial lay-off where available.
• Implementation of a strong crisis management since the first Covid-19 impact.
• Maintain since the begining of the crisis of close relationships with our main partners (Suppliers, Customers, Banks, …).
• Clear objectives have been defined during this period to:
• 1. Put in place the necessary health measures for the protection of our employees everywhere in the world.

1. Restart operational activities as soon as possible with respect to the health measures. o Continue the strategic projects (R&D, Offer,…)
   o Respect our commitments toward third-parties
   o Ensure the Group liquidity, while adjusting the operating expenses closely to the activity levels.

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MAIN FACTS

H1 2020

The health crisis due to Covid-19

With a view to preserving liquidity and adjusting operating expenses, the Group took the following decisions:

• Activation of supporting measures for companies (mainly partial lay-off) wherever it was possible, in particular, in France and the US.

• 1. €4.9 million cost savings registered during the 1st semester o No usage of the state guaranteed loan (PGE) in France
• Implementation of a cost and investment reduction plan (-15%) over the year.
• Decrease stock level by -25% over the year.
• Submission to all of the lenders of the syndicated loan a request for a waiver of the bank covenants for two periods (June and December 2020) and a request for an extension for an additional year of the maturity. These requests were unanimously accepted and without any condition on June 30, 2020. Therefore, the maturity date of the contract has been changed to July 17, 2025.

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MAIN FACTS H1 2020

Global Aerial Work Platform (AWP) market

• An AWP worldwide market in sharp decrease everywhere in the world except in China.
• The Chinese market could be the #1 market worldwide in 2020, in volumes.
• The North-American market has been particularly impacted by the crisis during the semester.
• Among the main worldwide markets, the Australian market has shown a good resilience.
• The majority of large occidental rental companies has temporarily frozen its investments.
• Fleet utilization rates of rental companies are back at 85%-90% of their level before the crisis.
• Maintain a well-oriented machines mix, at its 2019 level.
• The equipment electrification trend is confirmed.

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MAIN FACTS

H1 2020

Global aerial work platform market

	NORTH AMERICA	EUROPE
	

34%	27%
44%
	26%

1%

2%

• LATIN AMERICA



Source: AEM statistics, June 2020

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38%

28%

ASIA - PACIFIC

	Market trends
	Market weight (S1 2020 /2019)

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MAIN FACTS

H1 2020	 February 2020
 January 2020	Haulotte Australia
	move to its new
	subsidiary

Haulotte launches its

BIM library (Building May 2020

Information Modeling)

Haulotte extends its vertical mast products range with the STAR 6 CRAWLER.

• February 2020

 June 2020

Haulotte Vostok celebrates its 15th birthday

Haulotte extends its telescopic boom products range with the HT16 RTJ PRO

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REWARDS 2020

• Haulotte receives its first award of the year: The HA15 IP material is selected « best machine » by
  LOXAM HUNE
• Haulotte receives again a « Mât d'Or » with the HA16 RTJ PRO boom.

Haulotte wins for the second consecutive year the prize «China

Machinery Product TOP50» with the HA16 RTJ PRO

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MAIN FACTS

H1 2020

• An aerial work platform sales level that clearly improved between April and June but remained lower than 2019.
• Order cancellation limited over the period.
• Longer payment delays but few defaults recorded at this date.
• Sales prices remained stable over the period.
• Production adjusted downward to take into account the level of activity.
• Decrease of component prices is confirmed but the P&L impact remains limited due to the sudden fall of activity.
• Current Operating Result at € +5.2M (excluding forex gains & losses), decreasing by -78% and impacted by the health crisis and decreasing volumes.
• Negative net income for the half year at € -9.4 million (excluding IAS29 and IFRS 16), significantly penalized by the weakening of the vast majority of currencies against the euro, particularly those of Latin America.
• A net debt increasing of € +19.5M, impacted by the sharp and unpredictible decrease of activity.

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Sales breakdown by activity

in € Million (excluding IAS 29 & excluding IFRS 16)	H1 2020	H1 2019	Var.
Var. at constant exchange
			rate
Equipment sales	195,6	305,8	- 36%
	88%	89%	- 36%
Rental sales	6,8	11,0	- 38%
	3%	3%	- 39%
Services	20,3	25,8	- 21%
	9%	8%	- 21%
Total	222,7	342,6	- 35%
			- 35%

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Sales breakdown by zone of activity

in € Million (excluding IAS 29 & excluding IFRS 16)	H1 2020	H1 2019	Var.
Var. at constant
			exchange rate

Europe	134,1	218,5	- 39%
	60%	64%	- 39%
North America	37,8	51,1	- 26%
	17%	15%	- 28%
Latin America	10,3	19,1	- 46%
	5%	5%	- 47%
Asia and Pacific	40,5	53,9	- 25%
	18%	16%	- 23%
Total	222,7	342,6	- 35%
			- 35%

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Current operating income (excluding FX gains and losses) decreasing by -78% compared to June 2019

in € Million (excluding IAS 29 & excluding	H1 2020	H1 2019	Var.
IFRS 16)
Net Sales	222,7	342,6	-35%
Current operating excl. FX gains &	5,2	23,8	-78%
losses
2,3%	6,9%
Operating Income	3,1	20,8	-85%
	1,4%	6,1%
Income before tax	(8,9)	20,7	-143%
	-4,0%	6,0%
Consolidated Net Result	(9,4)	17,4	-154%
	-4,2%	5,1%

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Operating income decrease of € -17.7 million

in € Million (excluding IAS 29 & excluding IFRS 16)

2019 H1 EBIT	20,8 M€
			Change in gross margin	-24,8 M€
			Fixed costs	6,9 M€
			Bad debts	-0,8 M€
			Exchange gains and losses	-0,4 M€
			Other non recurring items	1,4 M€
2020 H1 EBIT	3,1 M€

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Gross margin decrease of € -24.8 million compared to 2019

in € Million (excluding IAS 29 & excluding IFRS 16)

2019 H1 Gross Margin	76,3 M€
					Impact of volume and mix on new machines sales	-21,0 M€
					Impact of price and FX on new machines sales	1,2 M€
					Margin on 2nd hand machines sales	-0,2 M€
					Impact of manufacturing performance	-3,4 M€
					Impact of raw materials	1,5 M€
					Margin on Service & Rental activity	-3,6 M€
					Inventory provision, warranty & others	0,7 M€
2020 H1 Gross Margin	51,5 M€

• Gross margin rate amounts to 23,1% compared to 22,3% last year.

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1. 14,9% decrease in fixed costs (excluding bad debt provisions, at constant exchange rate)

in € Million (excluding IAS 29 &	H1 2020	H1 2019	Var.
excluding IFRS 16)
Commercial costs	14,3	17,1	(2,8)
SG & A	25,6	29,6	(4,0)
R & D	5,1	5,2	(0,1)
Total (excl. depreciations)	45,0	51,9	(6,9)
Bad debt provisions	1,4	0,6	0,8
Total fixed costs	46,4	52,5	(6,1)

• Negative FOREX impact at € -0.7 million excluding bad debt provisions.

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Change in working capital

in € Million (excluding IAS 29 & excluding IFRS 16)	30.06.2020	31.12.2019
Change in inventories	(11,4)	13,3
Change in trade receivables	(12,8)	(25,8)
Change in trade payables	28,8	15,8
Change in other receivables and payables	0,4	0,8
Change in operating WC	5,0	4,1
Other changes (FX effect…)	(12,4)	(4,1)
Working capital*	221,9	229,3

• Working capital days increases from 158 to 182 at June 2020 end.
• DSO represents 94 days of revenue at June 2020 end, compared to 75 days at 2019 end.

* including non-current other assets and other liabilities

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Consolidated cash flow statement

in € Million (excluding IAS 29 & excluding IFRS 16)	30.06.20	30.06.19
Gross cash flows from continuing operations	5,3	23,5
Change in operating working capital	(5,0)	(10,0)
Change in receivables from financing activities	(6,4)	(12,3)
Cash flows from investment activities	(10,9)	(10,4)
Cash flows from financing activities	12,3	8,8
Net change in cash and cash equivalents	(4,7)	(0,4)

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Net debt (excluding guarantees and IFRS 16) increase by € +19.5 million to € 140.9 million

in € Million	June 20	Dec 19	June 19	Dec 18	Dec 17
Long term debt	143,5	132,8	54,0	46,1	68,0
Short term debt	53,6	46,3	100,6	102,0	14,3
Total financial debts	197,1	179,1	154,6	148,1	82,3
Cash	28,5	28,7	20,5	24,1	24,5
Net debt	168,6	150,4	134,1	124,0	57,8
Of which guarantees	27,7	29,0	26,1	26,1	23,8
Net debt excl. Guarantees	140,9	121,4	108,0	97,9	34,0

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Weight of financed sales in line with 2019

in € Million (Excluding IAS 29 & excluding IFRS 16)	H1 2020	H2 2019	H1 2019	2018	2017
Financed sales	43,2	53,1	53,9	92,6	128,4
Equipment sales	195,6	228,4	305,8	490,3	431,8
% of equipment sales	22,1%	23,3%	17,6%	18,9%	29,7%
Receivables on financed sales	64,5	60,2	50,1	38,0	32,7

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Financing and Group cash reserves

• As at June 30th, 2020, utilization of the existing € 130 million syndicated loan, was € 100 million.
• A waiver request with respect to bank ratios for two periods (June and December 2020) has been unanimously accepted and without any condition, by all the lenders on June 30th, 2020.
• Lenders also validated the one-year extension of the credit contract, according to the contract conditions signed on July 17th, 2019, extending its maturity to July 17th, 2025.

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III.

Recent activity and outlook

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MARKET CONTEXT FOR 2020

• Visibility remains extremely low due to the uncertainty of the crisis evolution.
• Global market significantly down compared to 2019.
• The European market should register a limited recovery during H2.
• North America and Latin America are not expected to show any sign of recovery during the next 6 months.
• Asia-Pacificshould remain stable, driven exclusively by China.
• A monetary environment that should be less favorable to the Group.

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GLOBAL TREND BY ZONES

					EUROPE
---
		NORTH AMERICA
			---

= ASIA - PACIFIC

---	LATIN AMERICA

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2020 OUTLOOK

• In an uncertain environment, where the lack of visibility remains a reality, Haulotte forecasts a decrease in sales by -25% to -30% in 2020 and a current operating income (excluding exchange gain & loss) that should remain positive at year-end.
• The main challenges for the end of 2020:

1. Reinforce our capability to forecast sales and adapt our industrial production accordingly o Reduce our inventories level
   o Optimize the operational expenses o Continue to deploy strategic projects

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Appendices

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IFRS 16 impacts as at 30.06.2020

in M€	31.12.2019	IFRS 16 Impact	30.06.2020
(excluding IFRS 16)
Impact on Balance Sheet
Right-of-use assets		18,2	18,2
Assets		18,2	18,2
Shareholders' equity		(0,5)	(0,5)
Non-current lease liabilities		13,6	13,6
Current lease liabilities		5,1	5,1
Liabilities		18,2	18,2
Impact on Income Statment
Current operating income excl. FX	5,2	0,3	5,5
gains & losses
of which rental expenses		3,4
of which amortization expenses		(3,1)
Financial result	(11,2)	(0,5)	(11,7)
Consolidated Net Result	(8,5)	(0,2)	(8,7)

• The majority of lease contracts are operating leases in which the Group is a lessee. The assets under lease are mainly buildings, vehicles and industrial equipment.

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Balance sheet assets at 30 June 2020 (including IFRS 16 & IAS 29)

Assets in € million	30.06.20	31.12.19
Non Currrent Assets	218,9	213,0
Goodwill	26,0	28,5
Intangible assets	34,4	34,2
Property, plant and equipment	65,9	63,9
Right-of-use assets (IFRS 16)	18,2	19,6
Financial assests	4,3	4,4
Deffered tax assets	19,4	18,9
Trade receivables from financing activities (> one year)	44,2	37,9
Other non current assets	6,5	5,6
Current Assets	332,5	371,0
Inventory	175,4	191,6
Trade receivables	78,1	93,6
Trade receivables from financing activities due (< one year)	19,6	21,6
Other assets	30,9	35,5
Cash and Cash equivalents	28,5	28,7
Total Assets	551,4	584,0

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Balance sheet liabilities at 30 June 2020 (including IFRS 16 & IAS 29)

Liabilities and Shareholders' equity in € million	30.06.20	31.12.19
Shareholders' equity before minority interests	244,7	264,7
Minority interests	(0,4)	(0,4)
Non current liabilities	171,3	161,7
Long-term borrowings	143,5	132,8
Non-current lease liabilities (IFRS 16)	13,6	14,8
Deferred tax liabilities	7,2	7,3
Provisions	7,0	6,8
Current liabilities	135,8	158,0
Trade payables	41,7	70,8
Other current liabilities	27,4	26,3
Current borrowings	53,6	46,3
Current lease liabilities (IFRS 16)	5,1	5,1
Provisions	8,0	9,5
Liabilities and Shareholders' equity	551,4	584,0

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Upcoming events

Quarter 3 sales:

October 13th, 2020

Annual sales:

February 9th, 2021

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Stock exchange ID

 Euronext Paris	Compartiment B
 ISIN	FR0000066755
 Mnémo	PIG
 Reuters	PYHE.PA
 Bloomberg	PIG FP
 CACS

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Shareholders at 30 June 2020

Public

35,81%

SOLEM

57,42%

Management,

employees and others

0,87% Treasury shares

5,90%

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