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JOHNSON ELECTRIC HOLDINGS LIMITED FY2018/19 Final Results

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JOHNSON ELECTRIC HOLDINGS LIMITED FY2018/19 Final Results JOHNSON ELECTRIC HOLDINGS LIMITED FY2018/19 Final Results May 2019 Group Overview Strategy & Outlook Key Financial Highlights Operational Results Appendix Page 2 Johnson Electric: Overview A global leader in electric motors, actuators, motion subsystems and related electro-mechanical components Serving a broad range of industries including Automotive, Smart Metering, Home Automation, Ventilation, White Goods, Medical Devices, Business Equipment, Power Tools, and Lawn & Garden Equipment Over 38,000 employees in more than 20 countries Listed on The Stock Exchange of Hong Kong since 1984 Page 3 History & Development SALES 2000-2019: US$ Going Global 3.3bn 1982-1999: Leveraging China to supply the 2.1bn world 1.7bn Early Years: 1.1bn Hong Kong 677m family business 251m 126m 16m 54m 1959 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2019 Fiscal Year AC Motor Opened Listed on Acquired Acquired Acquired Acquired Acquired business USA Sales HK Stock Gate SAIA-Burgess Stackpole AML HSC Equity established by Office Exchange from UTA Electronics International Interest Dr. Patrick Entered from 30% to Wang Automotive 80% Industry Founded by First Build Wang Seng factory in factories Liang & Guangdong in Mexico, Wang Koo Province Serbia & Yik Chun India Page 4 Group Overview Strategy & Outlook Key Financial Highlights Operational Results Appendix Page 5 Why Invest in Johnson Electric 1. Innovative motion solutions to consumers’ needs today – and for the future 2. Globally diversified sales and world-class customer base 3. Global operating footprint 4. Strongly positioned in China 5. Winning market traction for sustainable growth Page 6 Innovative Solutions for Today and the Future Applications for our motion technologies continue to grow • Subsystems and components that enable Automobile electrification, optimise thermal management, and provide comfort and safety • Motion solutions for automated windows, robotic Lifestyle equipment, cordless power tools, and single-serve coffee machines • Medical device subsystems for improved patient Medical outcomes • Surgical devices; vital signs monitoring Energy • Disconnect solutions for smart electricity and gas meters • Subsystems for airborne imaging Security • Digital security solutions for Bank Cards and Point of Sale equipment Page 7 Diversified Global Sales and Customer Base Evenly balanced across the world’s three major economic regions Group Sales by Destination Americas Asia 29%30% 38% 36% 33% 34% Europe • 500 Automotive Customers • 2000 Non-Automotive Customers Page 8 Diversified Global Sales and Customer Base World-Class Customers including: Page 9 Innovative Solutions for Automobile Performing critical functions across all vehicle propulsion types Enabling Electrification Johnson Electric’s Ensuring Comfort & & Reducing Emissions Automotive Product Safety Applications Engine • Lighting Actuators • Electric Turbo • HVAC Actuators • Valvetrain • Window Lifts • DEF Pump • Lumbar Support • Fuel Pump • Seat Motors • Electric Oil Pump • Door Lock Motors • ETC • Sun-Roof Motors • EGR • Powerlift Gate Motors Drivetrain Optimizing Thermal • DCT/AMT Management Chassis • AWD Disconnect • Braking (EPB / ESC) • Cooling Fan Module • Electric Parklock • Electric Vacuum Pump • Coolant Valve • Electric Oil Pump • Electric Power Steering • Electric Water Pump • Gear shifter • E-leveling • Electric Air Pump Product Application by Propulsion Type • iBooster / Brake-by-wire • Electric Oil Pump ICE Hybrid Electric • PM Suspension Parts Page 10 Trends in Automotive FUEL ECONOMY EMISSIONS Passenger car miles per gallon, Passenger car CO2 emissions and fuel normalized to CAFE consumption, normalized to NEDC EU 80 250 75 2030: 74 70 200 65 60 US China 55 China 2025: 56 150 2020: 48 2020: 117 50 US 45 100 2025: 99 40 35 50 EU normalised toCAFE 30 2030: 67 25 0 2000 2005 2010 2015 2020 2025 2030 Miles gallonper (gasoline equivalent), China EU US Grams CO2 km, per normalised toNEDC China EU US Source: International Council on Clean Transportation – APR 2018 http://www.theicct.org/global-pv-standards-chart-library Page 11 Many Factors will Impact Actual EV Uptake Rate of EV Adoption Government OEM Product Incentives Strategies % of Car Emissions Sales Mineral Regulations Prices Time Battery Oil Price Evolution Charging Infrastructure Source: Media and Analyst Reports; JE Analysis Page 12 Electrification: APG’s growth opportunity While ICE powertrain volumes will progressively decline, there is huge demand for innovative technology that cost-effectively enables the shift to Hybrids and EV. Top 10 Auto OEMs Volume by Propulsion Type Millions of Vehicles THE OPPORTUNITY FOR JE CAGR% For APG, the growth opportunity stems 2018-26 from the market’s need for innovative, EV cost-competitive solutions that: 26% Hybrid 1. Reduce emissions (including improving ICE efficiency) 2. Enable electrification 3. Optimise thermal management ICE These customer imperatives align directly with JE’s core capabilities and range of electric motors, actuators and pump technologies. Source: IHS Page 13 Longer Term Auto Industry Evolution Wide divergence of opinion on the eventual phasing out of ICE Incumbent Auto Volume of ICE (incl hybrid) Hybrid sales grow rapidly Negative impact on ICE doesn’t vehicle sales continue to and exceed BEV sales accelerate sharply until after Industry View grow until at least 2025 volumes to beyond 2030 2035 High Case EV Share of New Car Sales (%) Low Case EV development EV driving range and Rapid acceleration in EV New Entrant / highly dependent on infrastructure enhanced adoption from around 2030 government EV Optimist Tipping point for total cost New OEM platforms become subsidies for next 5 View parity around 2023-26 “BEV only”. ICE/Hybrids begin years phase out Source: Media and Analyst Reports; JE Analysis Page 14 Hybrids & EVs – Growing Demand of Cooling Fan Modules (CFMs) All powertrains need to be cooled down. Heat is moved to front cooling pack by several cooling systems with growing complexity CFMs are required on all Hybrids & EVs to cope with the increasing power density of powertrains As 48 volt and autonomous features become more standard, cooling requirements will increase Heavy-duty vehicles, traditionally equipped with mechanical driven fans, will introduce more electric driven CFMs on their hybrid powertrains JE offers: cost-effective solutions for entry level applications technologies Extra-performance solutions for higher end segments, which promote hybridisation as premium feature Page 15 Hybrids & EVs – Programs Adopting JE’s CFMs 2011 Renault Kangoo electric 2012 Volvo V60 plug-in hybrid 2012 Renault Zoe 2013 BMW i8 2013 BMW i3 2013 RangeRover hybrid 2015 Volvo S60L plug-in hybrid 2015 Honda Clarity fuel cell 2016 Roewe (SAIC) e950 2016 MG Erx5 hybrid 2016 Chevrolet Malibu hybrid 2016 Chrysler Town&Country hybrid 2016 BMW 7-series hybrid 2017 The London Taxi hybrid 2017 Renault Twingo and Smart electric Page 16 Hybrids & EVs – Need for Cooling Fan Modules 2017 Roewe (SAIC) ei6 2017 Land Rover Range Rover sport PHEV 2017 Land Rover Discovery Sport PHEV 2017 Maxus eG10 2017 Jaguar i-Pace 2017 Renault Kangoo electric 2017 Nio ES8 2017 BMW 5-series hybrid 2017 BMW X3 hybrid 2018 Eado HEV 2018 Jaguar E-Pace PHEV 2018 Roewe (SAIC) Marvel-X 2018 Buick Velite 6 2018 BMW i8 roadster 2018 BMW X5 hybrid Page 17 Hybrids & EVs – Need for Cooling Fan Modules 2018 Mazda Axela hybrid 2018 Mercedes GLE/GLS hybrid 2018 Volvo XC40 hybrid 2019 Ford Explorer hybrid Dedicated sourcing for HEV/EV vehicle is increasing. Still, majority of hybrid vehicles will be a derivative of a vehicle line-up. Page 18 Hybrids & EVs – Growing Demand of Water Pumps Battery cooling EGR cooling Turbocharger Power electronic cooling ICE Main water pump Applications ICE HEV EV Start/Stop Exhaust Gas MECH Recirculation 1 Turbocharger Cooling MECH Cabin Heating 1 1 1 1 Power Electronics 1 1 Intercooler MECH 1 Intercooler Traction Motor 1 1 Traction Motor Battery Cooling 1 1 TOTAL 1 3 4 4 Cabin Heating Page 19 Hybrids & EVs – Programs Adopting JE’s Water Pumps ► Aston Martin ► Dongfeng Liuqi ► FAW ► Ford ► GAC ► Geely ► Great Wall ► Jaguar Land Rover ► JMC ► SAIC - GM Page 20 Trends of Mechatronic System – Electric Oil Pumps (On-Demand) (On-Demand) Cooling / Lubrication Actuation On demand lubrication and cooling within oil On demand pressure actuation within oil systems are increasing to improve overall systems are increasing to support Start Stop, system efficiency and thermal management Sailing, Hybrids and EVs Application Segment ICE HEV EV Transaxle / Traction Transaxle / Traction Cooling& Lubrication Start/Stop motor motor Transmission / Reduction Start/Stop - Actuation AT / DCT / CVT Disconnect clutch AT (Low / Med Pressure) Transmission / Reduction - Actuation DCT / AWD disconnect DCT clutch Disconnect clutch (High Pressure) Page 21 . Hybrids & EVs – Programs Adopting JE’s Mechatronic Systems ► Audi ► BMW ► Changan ► FCA - Jeep Cherokee ► FCA - Ram ► GAC Trumpchi ► Geely Emgrand ► SAIC MG ► SAIC Roewe Page 22 Innovative Solutions for Industry & Consumers Delivering the actuation function for an increasingly connected world Touching Human Improving Proliferating Needs Performance More energy efficient Smaller and lighter Safer More controllable Physical = Internet + Objects More connected + Sensors, Controllers + Actuators Page 23 Winning Market Traction New business wins and sales trajectory set to sustain growth Medium-Term Sales Outlook $4.6bn 4-9%
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