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Press conference
Erik Ljungberg, Corporate Relations




   1
Interim Report January-September 2008
Jan Ytterberg, CFO




  2
First three quarters of 2008 – highlights


    Profitability at all time high
      Operating margin 15.8%
    –
    – High returns
    – Good revenue growth




3
Profitable growth
                   Vehicles & Services
                       SEK m.                                                       Percent
                       100,000                                                          55
    Net sales growth                                   EBIT Margin     Revenue
                                           ROCE
                                                                                           50
                        90,000
    11%                                                                                    45
                        80,000
                                                                                           40
    EBIT growth 25%     70,000
                                                                                           35
                        60,000
                                                                                           30
    ROCE 50.5%          50,000
                                                                                           25
                        40,000
                                                                                           20
                        30,000
                                                                                           15
                        20,000                                                             10
                        10,000                                                             5

                            0                                                              0
                                 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008*
                                                                                    Q3

                                 * Rolling 12 months



4
High volume
           Total deliveries, trucks and buses
                       Units
                      24,000
    Deliveries +4%
                      20,000
    Delivery times
    becoming          16,000

    shorter
                      12,000


                       8,000


                       4,000


                           0
                               Q1 Q2 Q3 Q4   Q1 Q2 Q3 Q4   Q1 Q2 Q3 Q4   Q1 Q2 Q3 Q4   Q1 Q2 Q3
                                 2004           2005          2006          2007        2008




5
Service business is growing
            Service revenue and rolling fleet
                       Units                                                                   SEK m.
                                                                                               18,000
                      600,000
    Capitalising on                                           Rolling fleet
                                          Service revenue
    substantial                                                                            16,000
                      500,000
    vehicle                                                                                    14,000

    population        400,000
                                                                                               12,000

                                                                                               10,000
                      300,000
    Increased
    prices                                                                                      8,000
                      200,000
                                                                                                4,000
                      100,000
                                                                                                2,000

                                                                                                0
                           0
                                1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008*
                                                                                        Q3

                                * Rolling 12 months



6
Operating income
                    Vehicles & Services


Strong EBIT growth
due to                                            Volume
                                                   Price
 – Higher vehicle
   and service           EBIT increase:         Product mix
   volume                + SEK 2,025 m. 9 mth
 – Prices
 – Product mix                                     R&D




7
Cash flow
                    Vehicles & Services
                        SEK m.
                         4,500
    Increased tied-up
                         4,000
    working capital
                         3,500
    – Volume growth
                         3,000
    – Higher
                         2,500
      inventories
                         2,000

                         1,500

                         1,000

                          500

                             0
                                 Q1 Q2 Q3 Q4     Q1 Q2 Q3 Q4      Q1 Q2 Q3 Q4      Q1 Q2 Q3 Q4     Q1 Q2 Q3
                                    2004             2005             2006             2007         2008
                                 Note: Excluding acquisitions/divestments and Financial Services



8
Volume driven growth
        Credit portfolio, Financial Services
                     SEK m.
                      45,000
Portfolio +8%,
local currencies     40,000

                     35,000

Increased bad debt   30,000

provisions in        25,000

several markets      20,000

                     15,000
Well balanced
                     10,000
portfolio
                      5,000

                          0
                               1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008




9
Bad debt expenses

     Percent
        0,80
                                                         Bad debt ratio     Write-off ratio
       0,70

       0,60

       0,50

       0,40

       0,30

       0,20

       0,10

       0,00
               1998   1999   2000   2001   2002   2003     2004    2005   2006   2007     2008
                                                                                           Q3




10
Conservative refinancing policy


                                    EIB loan
 Increased credit
 facilities
                            +70%
 EIB loan of SEK
 3,000 m.                             SEK
                                    24,300 m.
                         SEK
 Credit facilities &   14,210 m.
 EIB unutilised
                       Facilities   Facilities
                                      Sep 2008
                        End 2007




11
Building shareholder value

                     SEK                                                      Percent
                      14                                                          50
Net income +26%                                        EPS (SEK)
                                             ROE
                                                                                     45
                      12
Net margin 11.1%                                                                     40
                      10                                                             35

Earnings per share                                                                   30
                       8
SEK 12.60 rolling                                                                    25
                       6
12 months                                                                            20

                                                                                     15
                       4
Return on equity                                                                     10
                       2
43.3% (31.4)                                                                         5

                       0                                                             0
                           1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008*

                       * Rolling 12 months




12
Conclusion


     All time high earnings

     Focus on cash flow

     Financial services stable

     Conservative refinancing policy




13
14
Outlook
Leif Östling, President and CEO




   15
Market developments
            Order bookings trucks 9 months



     Western Europe -51%

     Central and eastern Europe -34%

     Latin America +29%

     Asia +3%




16
Orders lower than production

        Units
     100,000
                                Orders                   Production

      80,000



      60,000



      40,000



      20,000



           0
                                                                                                          Q2
                 Q1   Q2   Q3       Q4   Q1   Q2   Q3   Q4   Q1   Q2   Q3   Q4   Q1   Q2   Q3   Q4               Q3
                                                                                                     Q1
                       2004                   2005                2006                2007                2008
                Rolling 12 months




17
Flexible production cost structure
               Chassis production 2007



                Labour
                  cost

              Other

                   Sourced material
                   and components
                   (70%)




18
Flexibility – global product range




19
Service business is growing
             Service revenue and rolling fleet
                        Units                                                                   SEK m.
                                                                                                18,000
                       600,000
     Capitalising on                                           Rolling fleet
                                           Service revenue
     substantial                                                                            16,000
                       500,000
     vehicle                                                                                    14,000

     population        400,000
                                                                                                12,000

                                                                                                10,000
                       300,000
     Increased
     prices                                                                                      8,000
                       200,000
                                                                                                 4,000
                       100,000
                                                                                                 2,000

                                                                                                 0
                            0
                                 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008*
                                                                                         Q3

                                 * Rolling 12 months



20
Service business is growing

High level of
transport activity

High capacity
utilisation in
workshops

New services

~50% of volume in
captive network



21
Outlook


     Earnings in 2008 will be higher than 2007

     Due to uncertain situation about future
     business conditions, Scania provides no
     forecast for 2009

     Liquidity situation important factor for
     transport companies




22
23

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scana Presentation%20Q3%202008_tcm10-219195

  • 1. Press conference Erik Ljungberg, Corporate Relations 1
  • 2. Interim Report January-September 2008 Jan Ytterberg, CFO 2
  • 3. First three quarters of 2008 – highlights Profitability at all time high Operating margin 15.8% – – High returns – Good revenue growth 3
  • 4. Profitable growth Vehicles & Services SEK m. Percent 100,000 55 Net sales growth EBIT Margin Revenue ROCE 50 90,000 11% 45 80,000 40 EBIT growth 25% 70,000 35 60,000 30 ROCE 50.5% 50,000 25 40,000 20 30,000 15 20,000 10 10,000 5 0 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008* Q3 * Rolling 12 months 4
  • 5. High volume Total deliveries, trucks and buses Units 24,000 Deliveries +4% 20,000 Delivery times becoming 16,000 shorter 12,000 8,000 4,000 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2004 2005 2006 2007 2008 5
  • 6. Service business is growing Service revenue and rolling fleet Units SEK m. 18,000 600,000 Capitalising on Rolling fleet Service revenue substantial 16,000 500,000 vehicle 14,000 population 400,000 12,000 10,000 300,000 Increased prices 8,000 200,000 4,000 100,000 2,000 0 0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008* Q3 * Rolling 12 months 6
  • 7. Operating income Vehicles & Services Strong EBIT growth due to Volume Price – Higher vehicle and service EBIT increase: Product mix volume + SEK 2,025 m. 9 mth – Prices – Product mix R&D 7
  • 8. Cash flow Vehicles & Services SEK m. 4,500 Increased tied-up 4,000 working capital 3,500 – Volume growth 3,000 – Higher 2,500 inventories 2,000 1,500 1,000 500 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2004 2005 2006 2007 2008 Note: Excluding acquisitions/divestments and Financial Services 8
  • 9. Volume driven growth Credit portfolio, Financial Services SEK m. 45,000 Portfolio +8%, local currencies 40,000 35,000 Increased bad debt 30,000 provisions in 25,000 several markets 20,000 15,000 Well balanced 10,000 portfolio 5,000 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 9
  • 10. Bad debt expenses Percent 0,80 Bad debt ratio Write-off ratio 0,70 0,60 0,50 0,40 0,30 0,20 0,10 0,00 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Q3 10
  • 11. Conservative refinancing policy EIB loan Increased credit facilities +70% EIB loan of SEK 3,000 m. SEK 24,300 m. SEK Credit facilities & 14,210 m. EIB unutilised Facilities Facilities Sep 2008 End 2007 11
  • 12. Building shareholder value SEK Percent 14 50 Net income +26% EPS (SEK) ROE 45 12 Net margin 11.1% 40 10 35 Earnings per share 30 8 SEK 12.60 rolling 25 6 12 months 20 15 4 Return on equity 10 2 43.3% (31.4) 5 0 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008* * Rolling 12 months 12
  • 13. Conclusion All time high earnings Focus on cash flow Financial services stable Conservative refinancing policy 13
  • 14. 14
  • 16. Market developments Order bookings trucks 9 months Western Europe -51% Central and eastern Europe -34% Latin America +29% Asia +3% 16
  • 17. Orders lower than production Units 100,000 Orders Production 80,000 60,000 40,000 20,000 0 Q2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q3 Q1 2004 2005 2006 2007 2008 Rolling 12 months 17
  • 18. Flexible production cost structure Chassis production 2007 Labour cost Other Sourced material and components (70%) 18
  • 19. Flexibility – global product range 19
  • 20. Service business is growing Service revenue and rolling fleet Units SEK m. 18,000 600,000 Capitalising on Rolling fleet Service revenue substantial 16,000 500,000 vehicle 14,000 population 400,000 12,000 10,000 300,000 Increased prices 8,000 200,000 4,000 100,000 2,000 0 0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008* Q3 * Rolling 12 months 20
  • 21. Service business is growing High level of transport activity High capacity utilisation in workshops New services ~50% of volume in captive network 21
  • 22. Outlook Earnings in 2008 will be higher than 2007 Due to uncertain situation about future business conditions, Scania provides no forecast for 2009 Liquidity situation important factor for transport companies 22
  • 23. 23