Alfa Laval 04/02/2009
Report for Q4 and full year 2008 - Orders received and margins - Highlights - Development per segment - Geographical development - Financials - Outlook Mr. Lars Renström President and CEO Alfa Laval Group Key figures October December 2008 Orders received dropped 15% to SEK 6,181 million. Net sales rose 4.4% to SEK 8,096 million. Adjusted EBITA up 2.7% at SEK 1,721 million. - Negative currency effect SEK 65 million. January December 2008 Orders received down 0.4% at SEK 27,464 million. Net sales rose 11.5% to SEK 27,850 million. Adjusted EBITA up 23.7% at SEK 6,160 million. - Negative currency effect SEK 291 million. Alfa Laval Slide 3 Alfa Laval 1
Proposed dividend Proposed dividend for 2008 The board of Directors proposes a dividend of 2:25 SEK (2:25). Alfa Laval Slide 4 Orders received SEK million 8 000 7 000 6 000 5 000 4 000 3 000 2 000 SEK million R 12 32 000 28 000 24 000 20 000 16 000 12 000 8 000 1 000 0 +23% Q405 +28% Q106 +35% Q206 +17% Q306 +40% Q406 +36% Q107 +13% Q207 +30% Q307 0% Q407 +9% Q108 +8% Q208-3% Q308 Q408-15% 4 000 0 = rolling twelve months value = order intake per quarter Alfa Laval Slide 5 +xx% = % development at constant rates by quarter year on year Alfa Laval 2
%7000 5000 4000 04/02/2009 Order analysis October December 2008 2007 (SEK millions) 6,576 Structural change, % Currency effects,% Organic development, % Total, % + 2.5 + 9.0-17.5-6.0 2008 (SEK million) 6,181 Alfa Laval Slide 6 Organic development Marine cancellations ce a 6000-7% Marine orders -35% -4,5% Orders other segments -7% -6% Q4 07 Q4 08 Alfa Laval Slide 7 Alfa Laval 3
Adjusted EBITA / margin * SEK millions and in percent of sales 1 800 1575 1 350 1 125 900 675 450 225 24,0 21,0 18,0 15,0 12,0 9,0 6,0 3,0 0 Q405 Q106 Q206 Q306 Q406 Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 0,0 * Adjusted EBITA Earnings before interests, taxes, amortization of goodwill and step up values and comparison distortion items. Alfa Laval Slide 8 Report for Q4 and full year 2008 - Orders received and margins - Highlights - Development per segment - Geographical development - Financials - Outlook Mr. Lars Renström President and CEO Alfa Laval Group Alfa Laval 4
Highlights during the quarter Large orders, total SEK 335 million (160) Power order in China. Order value SEK 50 million. Delivery during 2010. Alfa Laval Slide 10 Highlights during the quarter Large orders, total SEK 335 million (160) Power order in China. Oil treatment order for power plant in Saudi Arabia. Order value SEK 70 million. Delivery during 2009. Alfa Laval Slide 11 Alfa Laval 5
Highlights during the quarter Large orders, total SEK 335 million (160) Power order in China. Oil treatment order for power plant in Saudi Arabia. Petrochemical order in South Korea. Order value SEK 120 million. Delivery during 2010. Alfa Laval Slide 12 Highlights during the quarter Large orders, total SEK 335 million (160) Power order in China. Oil treatment order for power plant in Saudi Arabia. Petrochemical order in South Korea. Clean technology order for U.S. power plant. Order value SEK 95 million. Delivery during 2009. Alfa Laval Slide 13 Alfa Laval 6
Report for Q4 and full year 2008 - Orders received and margins - Highlights - Development per segment - Geographical development - Financials - Outlook Mr. Lars Renström President and CEO Alfa Laval Group Orders received by Segment October December 2008, at constant rates Parts & Service + Life Science Process Industry Energy & Environment Food + + + Comfort & Refrigeration Marine & Diesel Fluids & Utility OEM Sanitary Alfa Laval Slide 15 Alfa Laval 7
Orders received by Segment The Process Technology Division, October December 2008, at constant rates Lower activity in brewery & vegetable oil industries Slow demand d in Process Industry - except refinery Life Science Process Industry Energy & Environment Food + + Positive development for Power boosted E&E Alfa Laval Slide 16 Orders received by Segment The Equipment Division, October December 2008, at constant rates Slowdown in Marine. Postponed dairy projects affected Sanitary. Strong development for OEM following continued demand for heat-pumps and AC. + Comfort & Refrigeration Marine & Diesel Fluids & Utility OEM Sanitary Alfa Laval Slide 17 Alfa Laval 8
Orders received by Segment January December 2008, at constant rates Parts & Service + Comfort & Refrigeration Life Science Process Industry = + = Marine & Diesel Fluids & Utility OEM Energy & Environment Food + Sanitary Alfa Laval Slide 18 Report for Q4 and full year 2008 - Orders received and margins - Highlights - Development per segment - Geographical development - Financials - Outlook Mr. Lars Renström President and CEO Alfa Laval Group Alfa Laval 9
Orders received by Region October December 2008, at constant rates -5-7 -44-27 Asia 28 % -11 Alfa Laval Slide 20 Highlights Americas October December 2008, at constant rates North America Base orders were stable. Orders on an unchanged level for Equipment, negative development for Process Technology. Latin America Region pressured by lower order intake in Argentina and Brazil, mainly for Refrigeration and Process Industry. Energy & Environment and Food performed well. Alfa Laval Slide 21 Alfa Laval 10
Highlights Europe October December 2008, at constant rates Western Europe incl. Nordic Weaker development for Equipment division, except OEM. Base orders were unchanged. Central and Eastern Europe Overall weak development in most markets. Negative impact from Marine cancellations in Turkey and Russia. Alfa Laval Slide 22 Highlights Asia October December 2008, at constant rates Asia Decline in Marine market continued. Large installed base boosted Parts & Service. Best performance in the Middle East and India. Alfa Laval Slide 23 Alfa Laval 11
Orders received by Region January December 2008, at constant rates -2 +11 Western Europe 25 % Asia 34% Alfa Laval Slide 24 Report for Q4 and full year 2008 - Orders received and margins - Highlights - Development per segment - Geographical development - Financials - Outlook Mr. Thomas Thuresson CFO Alfa Laval Group Alfa Laval 12
Highlights SEK millions October December 2008 Order intake 6,181 Net sales 8,096 Alfa Laval Slide 26 50 Gross profit margin In percent of sales 40 30 35 38.9 40.9 40.2 20 Q405 Q106 Q206 Q306 Q406 Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 Alfa Laval Slide 27 Alfa Laval 13
Highlights SEK millions Order intake Net sales Adjusted EBITA Adjusted EBITA-margin Non-recurring charge Profit before tax October December 2008 6,181 8,096 1,721 21.3% - 270 1,211 Alfa Laval Slide 28 Comparison distorting items SEK millions Sale of property in Brazil Restructuring charge October December 2008 102-270 P&L impact - 168 Alfa Laval Slide 29 Alfa Laval 14
Capacity and work-force reduction program communicated January 12 Measures under implementation to reduce the number of employees with about 1 000 during the first six months of 2009. Some 300 of these in Sweden. Annualized savings of approximately SEK 400 million are expected. Implementation estimated to lead to non-recurring costs of about SEK 300 million. SEK 270 million were charged to the fourth quarter. Full impact from program expected in the fourth quarter of 2009, the latest. Alfa Laval Slide 30 Earnings per share Oct - Dec 2008 2007 Jan - Dec 2008 2007 Earnings 2.03 2.42 8.83 7.12 Earnings, excluding step-up 2.15 2.54 9.26 7.64 Alfa Laval Slide 31 Alfa Laval 15
Share repurchases Dec 31 Mandate from AGM 2007 Number of repurchased shares Jan 1 - March 31* Percentage of outstanding shares Mandate from AGM 2008 Number of repurchased shares April 1 Dec 31 Percentage of outstanding shares 1 452 400 0.3 5 901 550 1.4 Total in MSEK spent on shares bought after Dec. 31 2007 Shares held are proposed to be cancelled at the AGM 766 * Remaining after cancellation. Alfa Laval Slide 32 Highlights SEK millions Order intake Net sales Adjusted EBITA Adjusted EBITA-margin Profit before tax Cash flow from operating activities ROCE ROE October December 2008 6,181 8,096 1,721 21.3% 1,211 877 53.8% 42.8% Alfa Laval Slide 33 Alfa Laval 16
Cash-flow statement SEK millions Cash flow from - operating activities - investing activities Financial net paid Dividends Repurchase of shares Total Jan Dec 2008 4,062-1,333-292 - 983-766 688 Jan - Dec 2007 3,264-1,676-244 - 725-1,497-878 Pro Forma Free-cash-flow* 3,023 2,464 *Incl. operating activities, capital expenditure (excl. product rights), provisions and financial net paid. Alfa Laval Slide 34 Foreign exchange Estimated impact on adjusted EBITA from Fx. fluctuations SEK million Q4 08 WY 08 WY 09* Translation effect Transaction effect Total 109-174 -65 0-291 - 291 250 135 385 *Based on EUR/USD 1. 30 and EUR/SEK 10.50 Alfa Laval Slide 35 Alfa Laval 17
Order backlog as per Dec 31 SEK millions 16000 14,730 14,310 14000 12000 12,359 2,344 3,298 2,668 10000 8000 6000 10,015 11,432 11,642 4000 2000 0 2006 2007 For delivery later than next year For delivery next year 2008 Alfa Laval Slide 36 Order backlog as per Dec 31 SEK millions 15000 14,730 14,310 12500 5,621 5,734 10000 7500 5000 9,109 8,576 2500 0 2007 2008 Marine Other Segments Alfa Laval Slide 37 Alfa Laval 18
Report for Q4 and full year 2008 - Orders received and operating margin - Highlights - Development per segment - Geographical development - Financials - Outlook Mr. Lars Renström President and CEO Alfa Laval Group Outlook for the first quarter We expect demand in the first quarter to be somewhat lower than the fourth quarter 2008. Alfa Laval Slide 39 Alfa Laval 19