Siemens Aktiengesellschaft · XETR:SIE
Siemens Aktiengesellschaft — Siemens — Investor Day (May 2019)
39 slides from Siemens Aktiengesellschaft's investor day presentation, May 8, 2019
Slide 1: Gas and Power
Gas and Power Lisa Davis CEO, Tim Holt COO, Michael Becker CFO Siemens Capital Market Day | Munich, May 8, 2019 Unrestricted © Siemens 2019 siemens.com
Slide 2: Notes and forward-looking statements
Notes and forward-looking statements This document contains statements related to our future business and financial performance and future events or developments involving Siemens that may constitute forward-looking statements. These statements may be identified by words such as “expect,” “look forw
Slide 3: As GP, we are more …
Gas and Power As GP, we are more … More resilient More customer portfolio focused More competitive More control structure of costs Unrestricted © Siemens 2019 Page 3 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Holt
Slide 4: Clear targets
Gas and Power Clear Broad Changing Concrete targets portfolio market actions Unrestricted © Siemens 2019 Page 4 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Holt
Slide 5: Clear targets
Gas and Power Clear Broad Changing Concrete targets portfolio market actions Unrestricted © Siemens 2019 Page 5 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Holt
Slide 6: Clear targets, clear goals
Clear targets, clear goals Grow Improve Increase Deliver Revenue Efficiency Profit Cash • Grow topline at • €1.5bn operational • €1bn cost out by • Cash Conversion market level productivity by FY23 (€700m by Rate of 1.0 by FY21 FY21) FY21 • Shift business mix for faster growth • Sharpen R&D • In mar
Slide 7: Delivering our targets despite strong market headwinds
Delivering our targets despite strong market headwinds Grow Revenue in €bn ~ 18.9 18.1 Revenue Oil & Gas Central Power Distributed Power Transmission Revenue FY18 Generation Generation FY21 Increase Profit ~ 8% 4% Adjusted EBITA One-Offs 1 Market Operational Structural Adjusted EBITA Margin FY18 FY1
Slide 8: Continuous focus on cost reduction and cash delivery
Continuous focus on cost reduction and cash delivery Orders (€bn) Revenue (€bn) 10.2 8.8 1 8.6 1 8.3 + 19% - 6% H1 FY18 H1 FY19 H1 FY18 H1 FY19 Adj. EBITA/ Free Cash margin (€m) 8-12% Flow (€m) H1 FY18 H1 FY19 5.8% - 60bps 6.3% 5.2% 5.6% - 6% -148 -0.29 -157 -0.36 515 432 Adj. EBITA margin Cash Conv
Slide 9: Broad portfolio
Gas and Power Clear Broad Changing Concrete targets portfolio market actions Unrestricted © Siemens 2019 Page 9 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Holt
Slide 10: Leading along the entire energy value chain
Leading along the entire energy value chain Key figures FY18 Position in relevant market €18.5bn €18.1bn 4% Adj. ~ 65,000 Oil and Gas Central Distributed Trans- Services Power Power mission and Digital Orders Revenue EBITA Margin Employees Generation 1 Generation > 100 MW < 100 MW #2 #2 #1 #2 Custom
Slide 11: Strengthening resiliency through balanced business mix
Strengthening resiliency through balanced business mix GP business mix – Revenue FY18 Market verticals Business types Geographical mix Central Power 1 Oil & Gas Generation (CP) Asia, Europe, 2 (OG) Australia CIS 17% Services Products 22% 28% 28% 41% 43% 31% Americas 30% 20% 29% MEA 11% Transmission
Slide 12: Industry-leading Service business
Industry-leading Service business Large and diverse fleet Strong business foundation Resilient performance Service-relevant fleet by region (units)1 Backlog (€bn) Revenue (€bn) 2 2 CAGR + 4.0% + 3.4% Stable CAGR + 2.7% Latin America (as reported) (comparable) (as reported) (comparable) Europe, 8,500
Slide 13: Our EPC business creates value
Large projects are in our DNA and we know how to do them Our EPC business creates value One EPC business unit Project NEMO Link Selective bidding Turnkey full-EPC HVDC – OE €290m Maximize GP value add Stringent risk management Reliable execution Project Ende Andina Three thermal and power generation
Slide 14: Changing market
Gas and Power Clear Broad Changing Concrete targets portfolio market actions Unrestricted © Siemens 2019 Page 14 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Holt
Slide 15: Market challenges and opportunities
Market challenges and opportunities Key trends, 2018 – 2023 (Source: IHS Autonomy 2018) GP market in €bn and % p.a. 1-2% Energy demand + 4% (Mtoe) 92.3 CAGR 87.1 FY18-23 Electrification + 10% (TWh) Transmission + 3% Coal Renewables Decarbonization - 4% + 34% (TWh) Central Distributed Oil & Gas + 3%
Slide 16: Innovating for customer value across the verticals
Innovating for customer value across the verticals Vertical Changing Customer Needs GP Answer Oil & Gas • Fast return on invest • Integrated system offers • Low total installed cost • Digital solutions (topsides 4.0) • Monetize stranded assets • Performance-based contracts Central Power • High effic
Slide 17: Concrete actions
Gas and Power Clear Broad Changing Concrete targets portfolio market actions Unrestricted © Siemens 2019 Page 17 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Holt
Slide 18: Implementing concrete actions to achieve our targets
Implementing concrete actions to achieve our targets Grow Improve Increase Deliver Revenue Efficiency Profit Cash • Service excellence • Continue • Leverage GP setup • All levers and for all verticals operational for significant cost all GP productivity drive savings • Leading innovation • Compensat
Slide 19: Our actions: Grow Revenue
Our actions Grow Improve Increase Deliver Revenue Efficiency Profit Cash • Service excellence for all verticals • Leading innovation for Transmission growth • Four key growth areas Unrestricted © Siemens 2019 Page 19 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Ho
Slide 20: Leveraging Service strength to grow in all verticals
Leveraging Service strength to grow in all verticals Strong foundation in core New initiatives Applied to all Service Revenue per unit1 Sample initiatives verticals FY16-18 FY18-21 Oil & Gas LGT • Transfer GT LTP Extended success to O&M compression and steam IGT & AGT Brownfield • Replace OOEMs GTs
Slide 21: Leading innovation to grow in Transmission
Leading innovation to grow in Transmission GP growth in Transmission Innovative End-to-End Global footprint & (>4% p.a.) driven by … products & systems integrated solutions factory network Focus areas GP opportunities GP innovations (examples) +47% • Blue products portfolio Offshore RE integration /
Slide 22: Booking business in new growth areas
Booking business in new growth areas Make fossil Deliver power Manage grid Facilitate energy greener out of a box complexity sector coupling Projects Braskem Chemical, Estrella del Mar III, Ultranet, Flexible energy Large Power-to- 60% H2-fueled cogen, SeaFloat mobile power, transmission, Germany Me
Slide 23: Our actions: Improve Efficiency
Our actions Grow Improve Increase Deliver Revenue Efficiency Profit Cash • Continue operational productivity drive • Point R&D towards Service and growth Unrestricted © Siemens 2019 Page 23 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Holt
Slide 24: Continue operational productivity drive
Continue operational productivity drive Productivity achieved Further measures in place • Drive “design-for- Technical • Harmonization of localization” specifications across Specifications businesses and markets • Increase functional Optimization (50 / 60 Hz) specifications to leverage supplier know
Slide 25: Our actions: Increase Profit
Our actions Grow Improve Increase Deliver Revenue Efficiency Profit Cash • Leverage GP setup for significant cost savings • Ensure project excellence Unrestricted © Siemens 2019 Page 25 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Holt
Slide 26: Deliver additional cost reduction by FY23
Deliver additional € 500 m cost reduction by FY23 Current Savings Synergies and Leaner Setup Support Function Total Savings from PG2020 1 Rightsizing in Regions Reduction FY23 Nov 2017 €200m €1bn €100m €200m €500m • Merge units • Pool resources • IT: Bundle services €100m in 5 global hubs €700m • Po
Slide 27: GP in control of support functions
Increased control with 70% of previous corporate allocation now GP managed Support Function Corporate allocation Examples for support Targeted functions reduction cost savings Reduction From To (before V2020+) (after V2020+) IT GP in ~ 90% under GP 20% control of 70% support SCM 100% cost ~ 90% unde
Slide 28: Our actions: Deliver Cash
Our actions Grow Improve Increase Deliver Revenue Efficiency Profit Cash • All levers and all GP • Compensation tied to cash generation Unrestricted © Siemens 2019 Page 28 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Holt
Slide 29: Deliver a CCR of 1.0 by FY21
Deliver a CCR of 1.0 by FY21 Current cash Measures in place along entire cash cycle performance due to … 33% of senior management Restructuring / cost out bonus linked to cash Inventories Purchasing Accounts Customer Fewer Receivables Payments pre-payments on projects Improve inventory Extend paymen
Slide 30: Our actions
Our actions Grow Improve Increase Deliver Revenue Efficiency Profit Cash Unrestricted © Siemens 2019 Page 30 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Holt
Slide 31: Clear targets, clear commitment
Clear targets, clear commitment Grow Improve Increase Deliver Revenue Efficiency Profit Cash • Grow top line • €1.5bn operational • €1bn cost out by • Cash Conversion at market level productivity by FY23 (€700m by Rate of 1.0 by FY21 FY21) FY21 • Shift business mix for faster growth • Sharpen R&D •
Slide 32: Prepared for the future!
Gas and Power Prepared for the future! Leading Experienced portfolio team More control of Strong ownership our business culture Clear priorities Committed and targets to delivering Unrestricted © Siemens 2019 Page 32 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Ho
Slide 33: Appendix
Appendix Unrestricted © Siemens 2019 Page 33 Munich, May 8, 2019 Siemens Capital Market Day | Gas and Power | Lisa Davis, Tim Holt
Slide 34: Oil and Gas
Oil and Gas Portfolio Highlights Upstream (Offshore/Onshore) • Gas compression & injection • Power generation & distribution • Advanced Digital Solutions Midstream • Pipeline compression • LNG liquefaction and boil-off gas Downstream • Compression for refining • Petrochemicals Topsides 4.0 Turbo and
Slide 35: Central Power Generation
Central Power Generation Portfolio Highlights Large gas turbines 117 MW to 593 MW Generators 25 MVA to 2,235 MVA Utility steam turbines 90 MW to 1,900 MW Power plant solutions Holistic solution capabilities Sector Coupling solutions • Gas turbine power plant solutions • Combined cycle power plants O
Slide 36: Distributed Power Generation
Distributed Power Generation Portfolio Highlights Aeroderivative gas turbines (4 MW to 71 MW) Industrial gas turbines (5 MW to 57 MW) Pre-designed and industrial steam turbines (<10 kW to 250 MW) Fast Power SGT-800 gas turbine Gas engines Solutions that can provide gas Designed for flexible operatio
Slide 37: Transmission
Transmission Portfolio Highlights High-voltage switchgear & devices Power transformers Substations High-voltage direct current (HVDC) Frequency stabilizer Grid access and connection transmission systems Compensate for voltage and frequency fluctuations solutions Stabilize power grids for greater ren
Slide 38: Service and Digital
Service and Digital Portfolio Highlights Standard Services Parts, field service, repairs and overhauls, remote operational service Service programs lifetime extension, modernization and upgrades Performance Enhancements Long term programs, operation and maintenance, leasing programs, Cyber Security
Slide 39: Digital Services deliver customer value proven in the marketplace
Service and Digital Digital Services deliver customer value that is proven in the marketplace Combining Customized Condition-based Physics-based service and maintenance physical OEM models support e.g. Profertil S.A. services with Remote intelligent data connectivity Enhanced Remote Diagnostics Serv