QUARTERLY PRESENTATION JANUARY JUNE Alexis Fries, President and CEO Jukka Pahta, CFO

Transcription

1 QUARTERLY PRESENTATION JANUARY JUNE 2015 Alexis Fries, President and CEO Jukka Pahta, CFO

2 CONTENTS 1. January-June overview 2. Improving profitability 3. Key project wins Alexis Fries, President & CEO 4. Financial performance Jukka Pahta, CFO 5. Appendices Q2/2015 PRESENTATION 2

3 1. JANUARY-JUNE OVERVIEW Q2/2015 PRESENTATION 3

4 MARKET REVIEW Overview Disparity between the U.S., European and Brazilian economic development Uneven development between the EU member states Low investment levels in the public sector in Europe Low commodity prices Demand Weak demand for energy related services in Europe Positive for industry and operational excellence services Slow-down in Brazil New investments Power generation in Asia and the Middle East Greenfield pulp mills, production capacity conversions in Europe Attractive project pipeline into new pulp production capacity in Brazil Public sector sentiment to initiate infrastructure investments Q2/2015 PRESENTATION 4

5 HIGHLIGHTS: POSITIVE DEVELOPMENT IN JANUARY-JUNE Order stock increased Increased in Industry and Management Consulting Stable in other Business Lines Comparable net sales increased Increased in Energy, Industry and Management Consulting Stable in the Regional Operations Operating profit improved Improved in all Business Lines Increased especially in the Regional Operations and in Industry Positive in all Business Lines except for the Regional Operations Structural adjustments progressed as planned Activity rate increased Q2/2015 PRESENTATION 5

6 OPERATING PROFIT INCREASED MEUR 1-6/ /2014 Change, % Order stock Net sales Operating profit 3-5 n.a. Net result -1-7 n.a. Comparable net sales Excluding the divestment in Finland Q2/2015 PRESENTATION 6

7 EVENTS AFTER THE REPORTING PERIOD: DIVESTMENT IN JULY Divestment*: All of Pöyry s shares in Korea District Heating Engineering Co Ltd Ltd, an engineering and consulting services company based in Seoul, South Korea Seller: Pöyry Finland Oy - owned 50% of shares in the company Buyer: KEPS Calista Private Equity Fund Gain on sale: Approximately 5.4 MEUR - included in financial income and expenses Impact on cash flow: Approximately +10 MEUR In alignment with Pöyry s strategy * Press release announcement Q2/2015 PRESENTATION 7

8 2. IMPROVING PROFITABILITY Q2/2015 PRESENTATION 8

9 BUILDING ON STRONG POSITION AND REPUTATION ENERGY INDUSTRY INFRA- STRUCTURE #4 in power generation in the world (Source: ENR 2014) 70 % of Europe s major energy players rely on our market projections #1 in pulp & paper in the world (Source: ENR 2014) Delivered projects for 80 % of the world s major pulp & paper companies More than 1,000 km of transportation tunnels in the last 10 years 100s of water and waste water treatment plants designed Q2/2015 PRESENTATION 9

10 BUILDING THE BASE FOR IMPROVED PROFITABILITY Improved profitability Sales focus and performance in project management Addressing structural and administrative challenges Q2/2015 PRESENTATION 10

11 CONTINUED SALES EFFORTS Group-wide opportunity monitoring fully in place Better sales management Sales-force development Continued sales training Monitoring sales effectiveness Stable order intake Increased in Energy, Industry and Management Consulting Prospect pipeline trends up in H1 Weekly sales reviews Q2/2015 PRESENTATION 11

12 STABLE ORDER INTAKE Business Line Energy Industry Regional Operations Management Consulting Jan-June 2015 vs Main reasons Increased Increased Declined Increased New orders in Asia-Pacific and Middle East Good order intake in both chemicals & bio-refining and pulp & paper Increased in Central Europe and decreased especially in Latin America Higher number of projects in the area of operational excellence services Excluding the divestment in Finland Q2/2015 PRESENTATION 12

13 IMPROVING PROJECT PERFORMANCE No new problem projects since 2012 Regular project reviews and reporting elearning launched in Q2 Assessment of project managers Senior PMs assessed in H1 All PMs assessed by 2016 New business management system underway Ramp-up in Q2/2015 PRESENTATION 13

14 IMPROVING EFFICIENCY Higher activity in all Business Lines Lower fixed expenses Higher sales per FTE Stable project contribution Q2/2015 PRESENTATION 14

15 3. KEY PROJECT WINS Q2/2015 PRESENTATION 15

16 ASSIGNMENT: ENGINEERING FOR A FOLDING BOXBOARD MACHINE PROJECT Client Kotkamills, Kotka, Finland Project Converting the paper machine product to packaging boards; introducing highquality recyclable barrier board that can be recycled without any special measures. Includes engineering consultancy, laser scanning, 3D modelling, detail engineering and site services. Follows on the pre-feasibility services performed by Pöyry. Annual capacity About 400,000 tonnes Start-up By the end of June 2016 Q2/2015 PRESENTATION 16

17 ASSIGNMENT: OWNER S ENGINEER SERVICES FOR A THERMAL POWER PLANT PROJECT Client PT Tanjung Power Indonesia (TPI), South Kalimantan, Indonesia Project Project management services and design review services. Implemented under Indonesia's Independent Power Producer (IPP) scheme, whereby the electricity is sold to the government-owned electricity company. Pöyry has been involved from the start of the development phase, assisting TPI in the preliminary design, IPP bidding, EPC (Engineering, Procurement and Construction) tendering and contract negotiations. Installed capacity 2 x 100 MW Completion By July 2018 Q2/2015 PRESENTATION 17

18 ASSIGNMENT: CONSORTIUM SELECTED TO IMPLEMENT A LIGHT RAIL PROJECT Client The City of Tampere, Finland Project A consortium comprising of Pöyry, VR Track and YIT to develop and implement a light rail system in the busiest part of the Tampere public transport system. The core of the approach consists of infrastructure modelling. Pöyry and VR Track will be jointly responsible for all engineering both in the development phase and the implementation. Separate decisions will be made on the implementation phase. Length of the line 23.5 kilometres with 23 to 25 stops Execution Completed in two parts, in 2019 and 2023 (if the implementation phase will start) Q2/2015 PRESENTATION 18

19 ASSIGNMENT: ENVIRONMENTAL IMPACT ASSESSMENT (EIA) SERVICES FOR A PLANNED PULP MILL Client Finnpulp Oy, Kuopio, Finland Project The world's largest softwood pulp mill investment. The EIA covers the various implementation alternatives for the mill project and a plan on the environmental impacts to be assessed. In addition to the construction and operation of the pulp mill, the EIA will cover e.g. road and rail connections and the power transmission network. It follows on a prefeasibility study by Pöyry. Annual production capacity 1.2 million tons raw materials for the tissue and packaging board industries; also bioelectricity and wood-based biochemicals Operational By the end of 2019 Q2/2015 PRESENTATION 19

20 4. FINANCIAL PERFORMANCE Q2/2015 PRESENTATION 20

21 ORDER STOCK INCREASED YEAR-ON-YEAR MEUR (482) MEUR Industry: up by 20 MEUR / / / /2014 Q2/2015 Energy Industry Regional Operations Management Consulting Comparable figures after divestments Q2/2015 PRESENTATION 21

22 COMPARABLE NET SALES INCREASED MEUR (285) MEUR Reported 2014: 304 MEUR Energy: up by 6 MEUR Industry: up by 6 MEUR 200 Q2: 151 (145) MEUR 100 Reported 2014: 152 MEUR 0 Comparable figures after divestments Q2/2015 PRESENTATION 22

23 OPERATING PROFIT INCREASED MEUR (-5) MEUR Grew in all Business Lines Regional Operations: -2 (-23) MEUR* Q2: 0 (-3) MEUR 2014: Group: Business divestment in Finland +19 MEUR * Regional Operations: Write-off of receivables from Venezuela -14 MEUR Various one-time items -6 MEUR 2015: * Regional Operations: One-time items -2 MEUR Q2/2015 PRESENTATION 23

24 NET SALES AND HEADCOUNT 1-6/2015 BY BUSINESS LINE Net sales: EUR (285.2) million Headcount: 5,803 (5,896) 12% 24% 8% 22% 8% 10% 55% 61% Energy Industry Regional Operations Management Consulting Comparable figures after divestments Q2/2015 PRESENTATION 24

25 ENERGY BUSINESS GROUP: NET SALES UP Net sales & operating margin, % MEUR % 9% 8% Sales 72 (66) MEUR Larger project executions in Middle East and Asia-Pacific % Q2: 38 (35) MEUR 6% % 4% 2% 5% 4% 3% 2% OP 2 (2) MEUR Lower margin due to weaker performance in Austria and in Sweden in particular 20 0 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 1% 0% Q2: 1 (1) MEUR Net sales Operating margin, % Rolling 12 months Q2/2015 PRESENTATION 25

26 INDUSTRY BUSINESS GROUP: NET SALES, PROFIT IMPROVED Net sales & operating margin, % MEUR % % 3% Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Net sales Operating margin, % 10% 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% Sales 24 (19) MEUR Consistent with the gradually improving order intake since 2014 Improved across most geographies Q2: 13 (9) MEUR net sales OP 2 (1) MEUR Increased clearly due to improved activity rate Q2: 1 (0) MEUR Rolling 12 months Q2/2015 PRESENTATION 26

27 REGIONAL OPERATIONS: OPERATING MARGIN IMPROVED Net sales & operating margin, % MEUR 400 4% % Sales 163 (164) MEUR Reported 2014: 182 MEUR % % -2% Q2: 80 (83) MEUR Reported 2014: 90 MEUR % -5% -4% -6% -8% -10% -12% OP -2 (-23) MEUR Declined in Northern Europe; grew in other regions, especially net sales in Central Europe due to improved activity rate Impacted by one-time items in 2014 and 2015 Net sales Operating margin, % Comparable figures after divestments, rolling 12 months Q2: -3 (-21) MEUR Q2/2015 PRESENTATION 27

28 MANAGEMENT CONSULTING: NET SALES, PROFIT INCREASED Net sales & operating margin, % MEUR % 7% 16% 14% 12% 10% 8% 6% 4% Sales 36 (34) MEUR Q2: 18 (16) MEUR OP 3 (2) MEUR Increased in line with net sales % 2% 0% Q2: 1 (1) MEUR 0-2% Net sales Operating margin, % Rolling 12 months Q2/2015 PRESENTATION 28

29 CASH FLOW MEUR *) **) 2014***) 1-6/2015 From operations Before financing *) 2011 includes the acquisition of the office real estate in Vantaa, Finland **) 2013 includes the divestment of the office real estate in Vantaa, Finland ***) 2014 includes the divestment of real estate business in Finland Cash flow from operations -9 (-36) MEUR Q2: -13 (-13) MEUR Cash flow before financing -9 (-8) MEUR Q2: -11 (14) MEUR Q2/2015 PRESENTATION 29

30 NET DEBT, EQUITY AND GEARING MEUR Gearing-% 70% 51.1% End of period Equity Net debt Gearing -% 60% 50% 40% 30% 20% 10% 0% Net debt 47 (43) MEUR Equity 93 (127) MEUR Figure in 2015 impacted by change in pension liabilities Gearing 51 (34)% The office real estate in Vantaa, Finland, was included in the balance sheets in 2011 and 2012 and sold in Q Q2/2015 PRESENTATION 30

31 THANK YOU

32 5. APPENDICES Q2/2015 PRESENTATION 32

33 RETURN ON INVESTMENT, % 10% 8% 6% 4% 2% 0% -2% -4% -6% -8% -10% 4.3% End of period Q2/2015 PRESENTATION 33

34 STATEMENT OF INCOME MEUR 1-6/ /2014 Net sales Other operating income Materials and supplies External charges, sub-consulting Personnel expenses Other operating expenses Operating profit/loss Net financial items Share of associated companies and joint ventures results Profit/loss before taxes Income taxes Net profit/loss for the period Q2/2015 PRESENTATION 34

35 BALANCE SHEET MEUR 30 Jun Jun 2014 Goodwill Other non-current assets Work in progress Other current assets Cash and cash equivalents Assets classified as held for sale Total assets Equity Interest bearing liabilities Pension obligations and other noncurrent liabilities Project advances Other current liabilities Total equity and liabilities Q2/2015 PRESENTATION 35

36 CASH FLOW MEUR 1-6/ /2014 Net profit / loss for the period Adjustments Depreciation and impairment losses Financial items and taxes Other adjustments Change in working capital Paid financial items and taxes Total from operating activities Net cash flow from investing activities Net cash before financing Net cash from financing Change in cash Q2/2015 PRESENTATION 36

37 KEY FIGURES 1-6/ /2014 Earnings per share, EUR (diluted) Equity per share, EUR ROI-% ROE-% Equity ratio-% Gearing-% Net debt, EUR million Capital expenditure, EUR million Personnel on average 5,091 5,659 Q2/2015 PRESENTATION 37