SOLID FINANCIAL POSITION SUPPORTS OUR GROWTH AGENDA

Transcription

1 SOLID FINANCIAL POSITION SUPPORTS OUR GROWTH AGENDA Marco Wirén, CFO & Executive Vice President 1

2 Business model based on growth opportunities and flexibility Faster than global GDP growth Flexible cost base Capital light expansion strategy Strong financial position Strong position in growing markets supported by solid service business Outsourced manufacturing model with low fixed costs Low capital expenditure requirements, expansion through joint ventures Customers advances create good cash flow generation. Low gearing supports M&A. 2

3 Net sales growth exceeds world GDP Wärtsilä s growth GDP growth % % Note 1: World nominal GDP growth, USD denominated, IMF World Economic Outlook October

4 Geographically dispersed sales limits dependence on specific economies USA 7% United Kingdom Norway 5% 3% 3% The Netherlands China and Hong Kong Russia 4% South Korea 9% 8% Brazil 1% Africa Singapore 4% 4% 3% Indonesia 4

5 Balanced customer segment exposure New equipment net sales Services net sales Traditional merchant 4% Cruise and Ferry 5% Special vessels 6% Navy 2% Other marine 2% Industrial 9% Utilities 14% Special vessels 8% Navy 7% Industrial 9% Utilities 15% Traditional merchant 16% Offshore 28% IPPs 17% Cruise and Ferry 12% IPPs 14% Gas carriers 13% Offshore 15% Gas carriers 4% Power Plants Ship Power 5

6 Flexibility in the cost base 21% 3% 12% 32% 14% 27% 65% 1% 25% Variable Semi-fixed Fixed Input materials Energy External services Depreciation and amortisation Employee benefit expenses Other operating expenses 6

7 Limited exposure to exchange rate risks Net sales by currency % 2% Operating costs by currency % 19% 67% 8% 7% 58% EUR USD NOK Other currencies Sales currency related principles: Equipment sales priced in euro Global spare parts price list in euros Local service work invoiced in local currency EUR USD NOK Other currencies Sensitivity analysis Impact of EUR exchange rate compared to other currencies: +/- 10% would result in -/+ 3.6% change in net sales Marginal impact on profitability 7 24 March, 2015 Marco Wirén

8 Limited exposure to exchange rate risks Transaction risks, fully hedged Equipment and spare parts sales mainly in euro Non-euro priced component purchases against the order book Translation risks limited, not hedged Local currency sales in non-euro countries Investments and goodwill in non-euro based subsidiaries Intragroup funding of subsidiaries in countries with not fully convertible home currencies 8 24 March, 2015 Marco Wirén

9 Our order book provides visibility Order book delivery time Order book rotation MEUR % NEW EQUIPMENT BUSINESS SHIP POWER 6 months-1.5 years POWER PLANTS 6 months-2 years 31% VOLUME BUSINESS SERVICES Average 3 months As of Dec 2014 To be delivered in 2015 To be delivered in 2016 and beyond 9

10 Sales guidance 2015 some growth expected MEUR % +0-10% +0-10% Of which Services order book EUR 600 million Order book for 2015 deliveries Services' order intake for 2015 deliveries Ship Power & Power Plants' order intake for 2015 deliveries Sales 2015 Sales

11 Solid profitability over the cycle MEUR % % 11.1% 10.9% 11.2% 11.9% 12% 10% 300 8% 6% 200 4% 100 2% % EBIT before non-recurring items EBIT% before non-recurring items 2014 figures include continuing operations. Figures for include both discontinued and continuing operations. 11

12 Balance sheet and capital allocation 12

13 Cash flow and working capital development Cash flow from operating activities MEUR Working capital MEUR % % % 20% % 20% % % % 5% % 5% % % Cash flow % of net sales Working capital % of net sales 13

14 Net debt and gearing on a low level Net debt MEUR Gearing 1,0 0,8 0,6 0,4 0,2 0, ,

15 Balanced loan maturity profiles Maturity profiles of long-term loans MEUR Average maturity: 43 months Interest rate (average): 1.7% Committed revolving credit facilities MEUR

16 Capital expenditure requirements low Capital expenditure & depreciation MEUR Acquisitions MEUR Capex, excl. acquisitions Depreciation, excl. acquisition related Acquisitions Acquisition related amortisation 16

17 Development of surplus values going forward MEUR Estimated amortisation Estimated year end value 17

18 Investing into existing business Priorities going forward R&D Total efficiency Cost of ownership Fuel flexibility and versatility Minimised environmental impact Reliability Capex Secure quality of our equipment Capex for 2015, excluding growth, expected to be in line with depreciation and amortisation Capitalised R&D 18

19 Strengthening market position through partnerships and acquisitions Reinforcing core competences through divestments and new partnerships Improving offering and market presence through acquisitions Priorities going forward Proceed with setting up of the CSSC Wärtsilä Engine Co. Ltd joint venture company Finalise L3 MSI acquisition and ensure smooth integration Pursue further M&A opportunities in Ship Power and Services 19

20 Focus on reaching our long-term profitability target 11.9% 14.0% Streamlining Increasing accountability Pricing Productivity Ensuring competitiveness Group efficiency program implemented during 2014 Setup of business line driven organisation Securing value based and market driven pricing Optimising lead times and focusing on continuous process improvement Investing into technological leadership March, 2015 Marco Wirén

21 Growth is on our agenda Strategic focus areas provide organic growth opportunities Gas as a fuel Environmental solutions Smart Power Generation Medium scale LNG infrastructure Focus on growth markets Local manufacturing and joint ventures Acquisitions support growth targets L-3 MSI acquisition enables access to new markets 21

22 Thank you! 22