• Type:
  • Category:

DEUTZ AG Deep Dive CMD 2024 | Financial Strategy and Outlook for Sustainable Growth

Share

DEUTZ AG CMD 2024: Key Takeaways

During the CFO perspective segment of DEUTZ AG’s Capital Market Day

Oliver Neu outlined the financial roadmap that aligns with the company’s Dual+ strategy. He focused on how DEUTZ aims to achieve sustainable growth while maintaining financial discipline. The primary goals are to support the ambitious revenue target of €4 billion by 2030 and ensure that by 2028, the company reaches €3.2 to €3.4 billion in revenue with an adjusted EBIT margin of 8-9%.

Key Highlights from Neu’s Presentation:

1. Growth and Revenue Targets

DEUTZ has set a path for revenue growth in three core areas: Classic Engines, Service, and Solutions. The strategic focus on expanding service offerings and energy business through strategic M&A and organic growth is a clear indication of our optimism about the company’s growth potential.

The Classic business, supported by recent Rolls-Royce Power Systems acquisitions, is expected to contribute significantly, especially with market recovery and portfolio adjustments.

2. Cost Reduction and Structural Efficiency

Neu introduced a €50 million cost reduction program aimed at long-term, sustainable cost improvements. This includes reducing R&D spending in the New Tech segment and streamlining the company’s global operations, targeting a more efficient supply chain.

The company aims to achieve €20 million in savings by 2025 and an additional €30 million by 2026, helping improve overall margins.

3. Capital Structure and Financing M&A

M&A plays a key role in DEUTZ’s growth strategy, particularly in expanding service and energy businesses. Neu emphasized that M&A efforts will be tailored and focus on high-margin, growth-oriented companies like Blue Star Power Systems, which was recently acquired.

Neu assured that DEUTZ will continue its disciplined approach to capital allocation. The company maintains a strong equity ratio above 40%, allowing room for further investments while optimizing its financial leverage (targeting a leverage ratio of 1-2x EBITDA).

4. Increased Shareholder Value

Neu highlighted DEUTZ’s commitment to improving free cash flow through operational performance, reducing CapEx intensity in new businesses, and improving working capital management. This commitment reassures our stakeholders about the company’s strong financial health and its ability to finance growth while increasing dividends for shareholders.

The company has updated its dividend policy, aiming for stable or growing dividends that reflect its improved company and profitability.

5. Financial Reporting and Segment Restructuring

From 2025, DEUTZ will restructure its segment reporting to reflect the new engines & services and solutions categories. This will allow for clearer visibility into the performance of traditional and future-focused businesses like energy and new tech.

Conclusion

Neu’s presentation focused on ensuring that DEUTZ can sustain profitable growth while remaining financially flexible to seize new opportunities in energy and technology markets. By controlling costs and optimizing the balance sheet, DEUTZ plans to maximize shareholder returns and expand globally in the energy sector, reaffirming our commitment to our shareholders’ investment.

Resources
Host
picofme 2 - DEUTZ AG Deep Dive CMD 2024 | Financial Strategy and Outlook for Sustainable Growth -%sitename%

Oliver Neu
CFO | DEUTZ AG

mark schneider - DEUTZ AG Deep Dive CMD 2024 | Financial Strategy and Outlook for Sustainable Growth -%sitename%

Mark Schneider
Head of Investor Relations | DEUTZ AG

picofme 3 - DEUTZ AG Deep Dive CMD 2024 | Financial Strategy and Outlook for Sustainable Growth -%sitename%

Rolf Becker
Investor Relations | DEUTZ AG

Share
T&C:

This publication is for informational purposes only and should not be considered investment advice. By using this website, you agree to the terms and conditions outlined in the legal pages at www.seat11a.com/legal/

Continuing the Journey: More Presentations

Discover Additional Elevator Pitches

Reviews for DEUTZ AG Deep Dive CMD 2024 | Financial Strategy and Outlook for Sustainable Growth
There are currently no reviews for DEUTZ AG Deep Dive CMD 2024 | Financial Strategy and Outlook for Sustainable Growth

(c) seat11a – Publicly Listed Companies: Elevator Pitch, Deep-Dive, Financial Results, and ESG 

Unlock the insights of top publicly listed companies with seat11a.com

 

Scroll to top