Ex-factory Sales Ex-factory Sales
Kia Motors 2014 Business Results January 23, 2015
Note for Investors This presentation has been prepared with unaudited 4th results of year 2014 for investor’s convenience. Therefore, some numbers may change upon the review of Kia’s independent auditors.
Table of Contents • Sales Summary • Financial Summary • Revenue & Profit Analysis • 2015 Business Plan • Appendix
Sales Summary • Retail Sales • Ex-factory Sales
▣ 2014 Sales Summary : Retail Sales (Unit : Thousand) +18.2% +8.4%
+4.3%
547 339
354
646
China
535
+1.5%
* Europe
580
US
+5.9%
-0.6%
458
465
Korea
867
862
Rest of World
2,746
2,907
2013
2014
Global Retail Sales 2013
2014 * Europe : EU + EFTA
1
▣ 2014 Sales Summary : Ex-factory Sales
2013
2014
Change (%)
Ex-factory Volume by Plant
(Unit : Thousand)
(Unit : Thousand) +7.6 %
Ex-factory Sales
2,827
Korea Plant
1,598
1,706
+6.8
458
465
+1.5
Export
1,140
1,241
+8.9
Overseas Plant
1,229
1,335
+8.6
Domestic
3,041
+7.6
3,041 2,827
US
369
366
-1.1
China
547
646
+18.2
Europe
313
323
+3.4
21.2% 19.3% 10.7% 11.1% 12.0% 13.1%
China
56.5%
56.1%
Europe US Korea
2013
2014
2
Financial Summary • Income Statement • Statement of Financial Position • Cash Flow Highlights
▣ Income Statement (Unit : Billion Won)
2013
as % of Rev.
2014
as % of Rev.
Revenue
47,598
100
47,097
100
-1.1
Cost of Sales
37,512
78.8
37,754
80.2
+0.6
Gross Profit
10,086
21.2
9,343
19.8
-7.4
SG&A
6,909
14.5
6,770
14.4
-2.0
Operating Profit
3,177
6.7
2,573
5.5
-19.0
Recurring Profit
4,829
10.1
3,816
8.1
-21.0
Net Profit
3,817
8.0
2,994
6.4
-21.6
Change (%)
* F/X Rate (USD/KRW) : 2013 W1,095 → 2014 W1,054 (41won↓, -3.7%) 3
▣ Statement of Financial Position (Unit: Billion Won)
2013-End
2014-End
Change
36,182
41,044
+4,862
Current Assets
13,472
16,626
+3,154
* (Cash)
(6,347)
(5,937)
(-409)
15,927
18,560
+2,633
3,339
4,691
+1,352
(Net Debt)
(-3,007)
(-1,246)
(+1,761)
Current Ratio
124.7%
138.9%
+14.2%p.
Equity
20,255
22,484
+2,229
16.5%
20.9%
+4.4%p.
-14.8%
-5.5%
+9.3%p.
Assets
Liabilities Debt
Debt-to-Equity Ratio * * Net Debt-to-Equity Ratio
* Cash = Cash & Cash Equivalents + Short-term Financial Instrument ** Net Debt-to-Equity = Net Debt / Equity
4
▣ Cash Flow Highlights (Unit : Billion Won)
Depreciation/ Amortization +4,331
Net Profit
1,337
Tangible/ Intangible Asset -4,164
-2,035
Others
2,994
-2,129
+167
2,478 2,311
Beginning
Ending
Cash Balance
Cash Balance * Above cash balance excludes shot-term financial instruments
5
Revenue & Profit Analysis • Revenue Analysis • COS and SG&A • Non-Operating Items
▣ Revenue Analysis Revenue by Region
Contributing Factors
-1.1%
▶ ASP Improvement · Korea : 19.1mn → 19.5mn (+2.1%)
Positive 47,598
47,097
18.9%
19.8%
· Export : $13.8thou. → $14.2thou. (+2.5%)
Negative 35.9%
▶ Won Appreciation · USD / KRW 1,095won → 1,054won (-3.7%)
35.8%
Sales by Segment 17.2%
17.8%
Korea North America
28.0%
26.6%
4.7%
4.5%
Europe
Others
29.2%
30.4% 52.2%
2013
52.0%
2014 13.9%
13.1%
• Korea : KMC domestic revenue • North America : KMA/KCI wholesale revenue + KMMG OEM revenue • Europe : Europe sales subsidiaries’ wholesale revenue + KMS export revenue
2013
2014
• Others : KMC direct export revenue + Russia/KMAU/KMNZ wholesale revenue
A+B+C
D+E
RV
Others
* Global retail sales (excluding China)
6
▣ COS and SG&A
COS
SG&A (% of Revenue)
(% of Revenue) -0.1%p. +1.4%p.
14.5% 80.2%
14.4%
2.2
2.3
4.5
4.3
1.9
1.9
2.2
2.1
78.8%
Salary & Wages Marketing Expense Export Expense Warranty Expense
2013
2014
3.7
3.8
2013
2014
Others
7
▣ Non-Operating Items (Unit: Billion won)
Equity Earnings
Finance Income / Expense
Other Income / Expense
+74
1,394 1,320 -234 -248
316
16 82 -232
2013
2014
2013
2014
2013
2014
8
2015 Business Plan
▣ 2015 Business Plan (Unit : Thousand)
2014
2015
Change (%)
Ex-Factory Sales
3,041
3,150
+3.6
Korea Plant
1,706
1,710
+0.2
465
480
+3.3
1,241
1,230
-0.9
Domestic Export
1,335
1,440
+7.9
US
366
365
-0.1
China
646
745
+15.3
Europe
323
330
+2.0
Overseas Plant
2014
2015
Retail Sales
2,907
3,103
+6.7
Domestic
465
480
+3.3
US
580
650
+12.0
* Europe
354
375
+5.8
China
646
745
+15.3
ROW
862
853
-1.0
Change (%)
* Europe : EU + EFTA
9
Thank you. http://pr.kia.com
Appendix • Retail Sales by Region (Korea, US, Europe, China, Rest of World)
• Quarterly Income Statement
▣ Korea Sales & Market Share
2015 Outlook & Strategy (Unit : Thousand)
Industry Demand : +2.0%
29.8%
28.0%
480
465
458
▣ Market Outlook
+3.3%
+1.5%
12.0%
12.5%
26.9%
30.7%
12.0%
37.7%
▷ Despite increase in household debts and weak real estate market, improved domestic economy coupled up with new car effect will lead to the highest market demand ever (1.7mn units in ’15) ▷ Sales growth of imported cars are expected to continue with additional individual consumption tax cuts and increased incentives from foreign brands
61.1%
56.8%
50.3%
▣ Strategy
2013
2015(P)
2014 PC
RV
CV
▷ New model launches of K5, Sportage to enhance product competiveness and profitability ▷ Sorento, Carnival to drive sales momentum continuously
* M/S is based on demand including imported cars.
9
▣ US Sales & Market Share
2015 Outlook & Strategy (Unit : Thousand)
Industry Demand : +1.9%
3.5% 3.4%
+12.0% +8.4
650
580
535 33.1%
▣ Market Outlook ▷ Based on improved consumer sentiment and stabilizing oil prices, demand recovery in RV segment will likely to be stronger compared to PC segment
27.6% 27.2%
▷ Due to lower demand growth expectation, competition among the automakers will get intensified 66.9% 72.4%
▣ Strategy
72.8%
▷ New model launch of Sorento(Jan) and expanded sales of Carnival to drive sales growth 2013
2015(P)
2014 PC
▷ Flexible incentive strategy to defend M/S and achieve sales target
RV
10
▣ Europe Sales & Market Share
2015 Outlook & Strategy (Unit : Thousand)
Industry Demand : +3.5%
2.8%
2.7%
+5.8%
▣ Market Outlook
+4.3%
375 354
339
34.4% 36.4%
33.1%
▷ Auto demand is likely to be maintained positive with expectation for potential demand growth in green-car segment ▷ Prolonged Russia crisis and deflation depression may limit the demand growth
65.6%
63.6%
66.9%
▣ Strategy ▷ Strengthened marketing activities to promote
new model launches of Sportage, cee’d F/L 2013
2015(P)
2014
▷ Sales promotion using low interest rate auto financing
programs to attract repurchases PC
RV
11
▣ China Sales & Market Share
2015 Outlook & Strategy (Unit : Thousand)
Industry Demand : +8.6%
3.8% 3.6%
+15.3% +18.2%
745
646 24.6%
547
▣ Market Outlook ▷ Motorization in western in-land cities and replacement demand in east-coast cities will support growth
21.2%
▷ Though less than double-digit growth rate expected due to concerns from slow domestic economy
24.4%
75.4%
▣ Strategy
78.8% 75.6%
▷ Full-utilization of China 3rd plant to allow sharper growth
than the industry 2013
2015(P)
2014
▷ Introduction of Chinese strategic models(KX3, K4) to
enhance product competitiveness PC
RV
12
▣ Rest of World Sales & Market Share
2015 Sales Plan (Unit : Thousand)
-0.6%
867 5.6%
30.0%
Rest of the world
-1.0%
862
853
5.1%
5.4%
29.8%
▣ Sales by Region Sales
YoY(%)
Weight
Middle East/Africa
299
+2.6%
35%
Russia
166
-12.0%
19%
47
+0.2%
6%
160
-2.7%
19%
75
+7.1%
9%
106
+6.0%
12%
30.1%
Eastern Europe/Turkey Latin America Canada 64.4%
(Unit : Thousand)
65.1%
64.5%
Asia/Pacific
▣ Strategy 2013
2015(P)
2014 PC
RV
CV
▷ Russia : - Reduce shipment from Korea/Slovakia plants - Reroute volume to other ROW markets - Increase prices to defend profitability - Focus sales capabilities on ‘Rio’
13
▣ Quarterly Income Statement (Unit : Billion Won)
2014
2013
4Q’14 vs. 4Q’13
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
Revenue
11,085
13,113
11,634
11,767
11,926
12,055
11,415
11,702
-0.5
COGS
8,740
10,123
9,277
9,372
9,447
9,587
9,196
9,525
+1.6
as % of Rev.
(78.8)
(77.2)
(79.7)
(79.6)
(79.2)
(79.5)
(80.6)
(81.4)
Gross Profit
2,345
2,990
2,357
2,395
2,479
2,468
2,219
2,177
Margin (%)
(21.2)
(22.8)
(20.3)
(20.4)
(20.8)
(20.5)
(19.4)
(18.6)
Operating Profit
704
1,126
696
650
736
770
567
501
Margin (%)
(6.4)
(8.6)
(6.0)
(5.5)
(6.2)
(6.4)
(5.0)
(4.3)
Recurring Profit
971
1,469
1,226
1,163
1,064
1,320
853
579
Margin (%)
(8.8)
(11.2)
(10.5)
(9.9)
(8.9)
(11.0)
(7.5)
(4.9)
Net Profit
784
1,181
903
949
876
1,024
657
436
(7.1)
(9.0)
(7.8)
(8.1)
(7.3)
(8.5)
(5.8)
(3.7)
Margin (%)
-9.1
-23.0
-50.2
-54.0
15
Note for Investors This presentation has been prepared with unaudited 4th results of year 2014 for investor’s convenience. Therefore, some numbers may change upon the review of Kia’s independent auditors.
Table of Contents • Sales Summary • Financial Summary • Revenue & Profit Analysis • 2015 Business Plan • Appendix
Sales Summary • Retail Sales • Ex-factory Sales
▣ 2014 Sales Summary : Retail Sales (Unit : Thousand) +18.2% +8.4%
+4.3%
547 339
354
646
China
535
+1.5%
* Europe
580
US
+5.9%
-0.6%
458
465
Korea
867
862
Rest of World
2,746
2,907
2013
2014
Global Retail Sales 2013
2014 * Europe : EU + EFTA
1
▣ 2014 Sales Summary : Ex-factory Sales
2013
2014
Change (%)
Ex-factory Volume by Plant
(Unit : Thousand)
(Unit : Thousand) +7.6 %
Ex-factory Sales
2,827
Korea Plant
1,598
1,706
+6.8
458
465
+1.5
Export
1,140
1,241
+8.9
Overseas Plant
1,229
1,335
+8.6
Domestic
3,041
+7.6
3,041 2,827
US
369
366
-1.1
China
547
646
+18.2
Europe
313
323
+3.4
21.2% 19.3% 10.7% 11.1% 12.0% 13.1%
China
56.5%
56.1%
Europe US Korea
2013
2014
2
Financial Summary • Income Statement • Statement of Financial Position • Cash Flow Highlights
▣ Income Statement (Unit : Billion Won)
2013
as % of Rev.
2014
as % of Rev.
Revenue
47,598
100
47,097
100
-1.1
Cost of Sales
37,512
78.8
37,754
80.2
+0.6
Gross Profit
10,086
21.2
9,343
19.8
-7.4
SG&A
6,909
14.5
6,770
14.4
-2.0
Operating Profit
3,177
6.7
2,573
5.5
-19.0
Recurring Profit
4,829
10.1
3,816
8.1
-21.0
Net Profit
3,817
8.0
2,994
6.4
-21.6
Change (%)
* F/X Rate (USD/KRW) : 2013 W1,095 → 2014 W1,054 (41won↓, -3.7%) 3
▣ Statement of Financial Position (Unit: Billion Won)
2013-End
2014-End
Change
36,182
41,044
+4,862
Current Assets
13,472
16,626
+3,154
* (Cash)
(6,347)
(5,937)
(-409)
15,927
18,560
+2,633
3,339
4,691
+1,352
(Net Debt)
(-3,007)
(-1,246)
(+1,761)
Current Ratio
124.7%
138.9%
+14.2%p.
Equity
20,255
22,484
+2,229
16.5%
20.9%
+4.4%p.
-14.8%
-5.5%
+9.3%p.
Assets
Liabilities Debt
Debt-to-Equity Ratio * * Net Debt-to-Equity Ratio
* Cash = Cash & Cash Equivalents + Short-term Financial Instrument ** Net Debt-to-Equity = Net Debt / Equity
4
▣ Cash Flow Highlights (Unit : Billion Won)
Depreciation/ Amortization +4,331
Net Profit
1,337
Tangible/ Intangible Asset -4,164
-2,035
Others
2,994
-2,129
+167
2,478 2,311
Beginning
Ending
Cash Balance
Cash Balance * Above cash balance excludes shot-term financial instruments
5
Revenue & Profit Analysis • Revenue Analysis • COS and SG&A • Non-Operating Items
▣ Revenue Analysis Revenue by Region
Contributing Factors
-1.1%
▶ ASP Improvement · Korea : 19.1mn → 19.5mn (+2.1%)
Positive 47,598
47,097
18.9%
19.8%
· Export : $13.8thou. → $14.2thou. (+2.5%)
Negative 35.9%
▶ Won Appreciation · USD / KRW 1,095won → 1,054won (-3.7%)
35.8%
Sales by Segment 17.2%
17.8%
Korea North America
28.0%
26.6%
4.7%
4.5%
Europe
Others
29.2%
30.4% 52.2%
2013
52.0%
2014 13.9%
13.1%
• Korea : KMC domestic revenue • North America : KMA/KCI wholesale revenue + KMMG OEM revenue • Europe : Europe sales subsidiaries’ wholesale revenue + KMS export revenue
2013
2014
• Others : KMC direct export revenue + Russia/KMAU/KMNZ wholesale revenue
A+B+C
D+E
RV
Others
* Global retail sales (excluding China)
6
▣ COS and SG&A
COS
SG&A (% of Revenue)
(% of Revenue) -0.1%p. +1.4%p.
14.5% 80.2%
14.4%
2.2
2.3
4.5
4.3
1.9
1.9
2.2
2.1
78.8%
Salary & Wages Marketing Expense Export Expense Warranty Expense
2013
2014
3.7
3.8
2013
2014
Others
7
▣ Non-Operating Items (Unit: Billion won)
Equity Earnings
Finance Income / Expense
Other Income / Expense
+74
1,394 1,320 -234 -248
316
16 82 -232
2013
2014
2013
2014
2013
2014
8
2015 Business Plan
▣ 2015 Business Plan (Unit : Thousand)
2014
2015
Change (%)
Ex-Factory Sales
3,041
3,150
+3.6
Korea Plant
1,706
1,710
+0.2
465
480
+3.3
1,241
1,230
-0.9
Domestic Export
1,335
1,440
+7.9
US
366
365
-0.1
China
646
745
+15.3
Europe
323
330
+2.0
Overseas Plant
2014
2015
Retail Sales
2,907
3,103
+6.7
Domestic
465
480
+3.3
US
580
650
+12.0
* Europe
354
375
+5.8
China
646
745
+15.3
ROW
862
853
-1.0
Change (%)
* Europe : EU + EFTA
9
Thank you. http://pr.kia.com
Appendix • Retail Sales by Region (Korea, US, Europe, China, Rest of World)
• Quarterly Income Statement
▣ Korea Sales & Market Share
2015 Outlook & Strategy (Unit : Thousand)
Industry Demand : +2.0%
29.8%
28.0%
480
465
458
▣ Market Outlook
+3.3%
+1.5%
12.0%
12.5%
26.9%
30.7%
12.0%
37.7%
▷ Despite increase in household debts and weak real estate market, improved domestic economy coupled up with new car effect will lead to the highest market demand ever (1.7mn units in ’15) ▷ Sales growth of imported cars are expected to continue with additional individual consumption tax cuts and increased incentives from foreign brands
61.1%
56.8%
50.3%
▣ Strategy
2013
2015(P)
2014 PC
RV
CV
▷ New model launches of K5, Sportage to enhance product competiveness and profitability ▷ Sorento, Carnival to drive sales momentum continuously
* M/S is based on demand including imported cars.
9
▣ US Sales & Market Share
2015 Outlook & Strategy (Unit : Thousand)
Industry Demand : +1.9%
3.5% 3.4%
+12.0% +8.4
650
580
535 33.1%
▣ Market Outlook ▷ Based on improved consumer sentiment and stabilizing oil prices, demand recovery in RV segment will likely to be stronger compared to PC segment
27.6% 27.2%
▷ Due to lower demand growth expectation, competition among the automakers will get intensified 66.9% 72.4%
▣ Strategy
72.8%
▷ New model launch of Sorento(Jan) and expanded sales of Carnival to drive sales growth 2013
2015(P)
2014 PC
▷ Flexible incentive strategy to defend M/S and achieve sales target
RV
10
▣ Europe Sales & Market Share
2015 Outlook & Strategy (Unit : Thousand)
Industry Demand : +3.5%
2.8%
2.7%
+5.8%
▣ Market Outlook
+4.3%
375 354
339
34.4% 36.4%
33.1%
▷ Auto demand is likely to be maintained positive with expectation for potential demand growth in green-car segment ▷ Prolonged Russia crisis and deflation depression may limit the demand growth
65.6%
63.6%
66.9%
▣ Strategy ▷ Strengthened marketing activities to promote
new model launches of Sportage, cee’d F/L 2013
2015(P)
2014
▷ Sales promotion using low interest rate auto financing
programs to attract repurchases PC
RV
11
▣ China Sales & Market Share
2015 Outlook & Strategy (Unit : Thousand)
Industry Demand : +8.6%
3.8% 3.6%
+15.3% +18.2%
745
646 24.6%
547
▣ Market Outlook ▷ Motorization in western in-land cities and replacement demand in east-coast cities will support growth
21.2%
▷ Though less than double-digit growth rate expected due to concerns from slow domestic economy
24.4%
75.4%
▣ Strategy
78.8% 75.6%
▷ Full-utilization of China 3rd plant to allow sharper growth
than the industry 2013
2015(P)
2014
▷ Introduction of Chinese strategic models(KX3, K4) to
enhance product competitiveness PC
RV
12
▣ Rest of World Sales & Market Share
2015 Sales Plan (Unit : Thousand)
-0.6%
867 5.6%
30.0%
Rest of the world
-1.0%
862
853
5.1%
5.4%
29.8%
▣ Sales by Region Sales
YoY(%)
Weight
Middle East/Africa
299
+2.6%
35%
Russia
166
-12.0%
19%
47
+0.2%
6%
160
-2.7%
19%
75
+7.1%
9%
106
+6.0%
12%
30.1%
Eastern Europe/Turkey Latin America Canada 64.4%
(Unit : Thousand)
65.1%
64.5%
Asia/Pacific
▣ Strategy 2013
2015(P)
2014 PC
RV
CV
▷ Russia : - Reduce shipment from Korea/Slovakia plants - Reroute volume to other ROW markets - Increase prices to defend profitability - Focus sales capabilities on ‘Rio’
13
▣ Quarterly Income Statement (Unit : Billion Won)
2014
2013
4Q’14 vs. 4Q’13
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
Revenue
11,085
13,113
11,634
11,767
11,926
12,055
11,415
11,702
-0.5
COGS
8,740
10,123
9,277
9,372
9,447
9,587
9,196
9,525
+1.6
as % of Rev.
(78.8)
(77.2)
(79.7)
(79.6)
(79.2)
(79.5)
(80.6)
(81.4)
Gross Profit
2,345
2,990
2,357
2,395
2,479
2,468
2,219
2,177
Margin (%)
(21.2)
(22.8)
(20.3)
(20.4)
(20.8)
(20.5)
(19.4)
(18.6)
Operating Profit
704
1,126
696
650
736
770
567
501
Margin (%)
(6.4)
(8.6)
(6.0)
(5.5)
(6.2)
(6.4)
(5.0)
(4.3)
Recurring Profit
971
1,469
1,226
1,163
1,064
1,320
853
579
Margin (%)
(8.8)
(11.2)
(10.5)
(9.9)
(8.9)
(11.0)
(7.5)
(4.9)
Net Profit
784
1,181
903
949
876
1,024
657
436
(7.1)
(9.0)
(7.8)
(8.1)
(7.3)
(8.5)
(5.8)
(3.7)
Margin (%)
-9.1
-23.0
-50.2
-54.0
15
