Volkswagen Ag Unsp/Adr

Hello, ladies and gentlemen, and welcome to the investor and analyst conference call of Volkswagen AG. At this time, all participants have been placed on a listen-only mode. The floor will be open for questions following the presentation. Let me now turn the floor over to Rolf Woller.

Thank you very much. Good morning, good afternoon, or good evening, everyone, from wherever you have dialed in. and a warm welcome to the Volkswagen Group Investor Relations and Analyst Call 2024. With me today we have Oliver Blumer, our CEO, and Arno Antlitz, our CFO, COO. The presentation is structured in three parts. First, Olli will provide a brief overview and highlight the key strategic milestones achieved in 2024. He will be followed by Arno, who will guide us through the financials of 2024 and provides us with the financial outlook for 2025. Finally, Olli will provide us with a strategic outlook for 2025 before we enter the Q&A session. Before we start, let me provide a few remarks. You should have received the press release, the annual report, and other related materials, all of which were published early this morning. If you haven't received them, you can find all related documents on our website. In case of any issues, give us a call or drop us an email, and we will send them straight to you. As a reminder, and as always, the safe-haver language and other cautionary statements on page two of our presentation, which will govern today's presentation. I would like to encourage you to read the disclaimer carefully and in full, since all forward-looking statements are qualified by this language. In order to maximize the time we have for the presentation and the Q&A, I will not read it loud to you. And with that and any further ado, I hand over to Olli. Olli, the floor is yours.

Thank you, Rolf. And also from my side, a warm welcome to everyone on the call after our annual media conference we have held in Wolfsburg, our headquarter. 2024 was the year of major strategic decisions for Volkswagen Group and all this in a rapidly changing environment. We have faced weak demands in Europe rising trade barriers, challenging industrial framework conditions in our domestic market, fierce price competition, especially in China, and at the same time, the need to invest powerfully in the future. Volkswagen Group has not allowed those to slow it down. On the contrary, we have set a decisive course for 2024 and we drove change forward sustainably along our group-wide top 10 program and even gone further. In 2024, we have achieved the goals we set ourselves. Let us have a look on some of our key achievements in the last year. 2024 marked a year with a comprehensive model offensive. We have been renewing our main volume models from Volkswagen's Skoda Cupra and many highlights from Audi and Porsche. In total, we launched more than 30 new models to the markets across our group. We have sharpened the designs, once again emphasized our brand identities, and measurably improved the quality of our products and services well received in the markets. and we are rewarded with the great feedback beside of our customers also from the trade press. This proves we are right on track. In China our new strategy makes us fit for the opportunities and the challenges in the world's luggage car market and much more competitive. With new strong regional tech partners along the key differentiating technologies The launch of our innovation hub in Hefe accelerating development time to China speed, reworked cost structures allowing us to match local competition, and new product strategy fully tailored to our Chinese customers. Unlike many other manufacturers, we continue to earn money in China thanks to our strong position in the combustion engine business, an important factor in the most competitive and agile market. This allows us to continue to invest in new models and technologies and enhance our competitiveness. North America remains key to the Volkswagen Group's growth strategy. With our investments in the region and in strategic partnerships, we are sending a clear signal for our ambition to grow in new market segments in this region. The revival of Heritage Brand Scout allows us to enter the attractive pickup and rugged SUV business with highly flexible drivetrain options. Meanwhile, we have received almost 80,000 orders with prepayment. In 2024, we reached major milestones for a global software strategy. We have realigned our software activities and strengthened the team with new partners. Together with Xiaoping for China and our new OS partner Rivium for the other regions of the world, we are developing the electronic architectures and software solutions of the automotive future. Carriots will focus on the further developed and central digital services, autonomous driving, infotainment, cloud services, and data processing, and backend solutions. In collaboration with Carriot, we are also putting the responsibility and control over the software where it belongs with our brands. Last but not definitely not least, the future Volkswagen agreement is a foundation for an economically success future of our German operations and Volkswagen AG in particular. A milestone in rebuilding competitive and future-proof structures in the long term. Reducing overcapacities in Germany, lowering labor costs, enhancing productivity, and achieving competitive plant costs, these are the cornerstones of the agreement. Adherence to the agreed productivity target is reviewed quarterly. This is how we ensure that the agreements made are met. Negotiations were tough, but we achieved a fair result and effective for our medium-term strategic targets. Anno will provide more details later in the presentation. Despite considerable challenges and restructuring work, we were able to achieve almost €325 billion in group revenue and 19.5 billion in operating profits. These are solid results in a challenging global environment. The fact that we have achieved them in a phase of restructuring with considerable cost headwinds proves our resilience and our will to shape the future. With our robust balance sheet and net liquidity, we are well prepared for the new year. This financial stability gives us the necessary leeway to continue investing in the future and pursue our strategic goals. Based on these results, we propose a dividend of 6.36 euro per preference share to the annual general meeting in May. This corresponds to a payout of 30% of net profit. Our product renewal is starting to pay off. With a relaunch of more than 30 models across all brands, we closed 2024 with a strong 2.5 million deliveries in the fourth quarter. Nine million vehicles delivered means that we kept our global market share. Incoming orders in Western Europe increased in the fourth quarter by around 128,000 units and stood at around 800,000 units. Incoming orders in December once again accelerated significantly compared to the previous year and increased by almost 90,000 vehicles. Incoming orders from 24 as a whole were therefore a good 16% up to the previous year, mainly because of our attractive new product range, which is becoming increasingly available to the market. At the end of December, the order backlog in Europe stood at a very healthy level of around 850,000 units. Deliveries in Europe were stable, and Volkswagen Group remains the market leader for both combustion engines and electric vehicles. The increase in deliveries of electric vehicles in particular had a positive impact in the final quarter, which were almost 20% higher than in the same quarter of the previous year. Our activities in North America recorded strong growth of 6%, with the Volkswagen brand even growing by 18% in the region. This is an important first step towards a more robust global presence and an excellent result from our team there. All in, we almost compensated for the communicated and anticipated decline of sales in China in an intense competitive environment. Despite the weakness of the German electric vehicle market, we kept our share of battery electric vehicles stable in 2024. In total, we delivered 745,000 battery electric vehicles to customers worldwide in 2024, about 3% less than in 2023. In addition, plug-in hybrid sales were up by 5% to 270,000 units. And we expect strong growth in 2025 to a battery electric vehicle share of 10% to 14% globally. Key drivers will be the latest successful product launches, including the ID.7 Tourer, the entry-level of Skoda Airoc, as well as the premium and luxury segment vehicles Porsche Imacan and Audi Q6 e-tron. Not to forget the all-new Audi A6 e-tron. Our upgraded model line is very well received in the markets as evidenced by the latest order intake in Western Europe, which is up by almost 50% year-to-date. Battery electric vehicles represent more than 20% of our European order book. All over, we got off to a promising start towards the full-year target, and after the first two months, our battery electric vehicle share in Western Europe has been increasing to more than 18%, strongly up from 9%, in quarter one in 24. It has doubled. I would now like to hand over to Arno for a detailed analysis of our financial performance.