Neles Oyj — FY2021 Earnings Presentation
21 slides from Neles Oyj's earnings presentation, Feb 4, 2022
Slide 1: Strong order intake and sales volume supporting solid profitability
Financial Statements Review 2021: Strong order intake and sales volume supporting solid profitability Simo Sääskilahti, interim President and CEO February 4, 2021
Slide 2: Merger consideration and forward-looking statements
Merger consideration and forward-looking statements This Financial Statements Review is not an offer of merger consideration shares in the United States. The merger consideration shares have not been and will not be registered under the U.S. Securities Act of 1933 (the “Securities Act”), and may not
Slide 3: Important note about this financial information
Important note about this financial information In this Financial Statements Review, a comparable cash flow statement is disclosed in addition to IFRS financial information. Figures in parentheses refer to the corresponding period of the continuing operations in 2020 unless otherwise stated. Neles G
Slide 4: Contents
Contents Q4 highlights 2021 Business review Financial review 4 Financial Statements Review 2021
Slide 5: Positive ending to a challenging year, 20% organic order growth in Q4
Positive ending to a challenging year, 20% organic order growth in Q4 • Positive situation in Pulp, Paper and Bioproducts, as well as Services. MRO-driven business continued to recover • Chemical and Oil & Gas projects’ market situation remained weak, with clear signs of improvement at the end of th
Slide 6: Good sales volume and business performance led to solid profitability in Q4
Good sales volume and business performance led to solid profitability in Q4 EUR million % of sales 200 Group key figures – Q4/21 (Q4/20) 180 20 160 • Orders received EUR 170.4 (134.5) million, +27%, in comparable currencies/organic +20% 140 15 • Sales EUR 174.2 (154.9) million, +12%, in 120 comparab
Slide 7: Markets and operating environment in Q4
Markets and operating environment in Q4 North America • NA: Orders grew by 61% compared to 59 53 56 EMEIA 45 58 55 60 60 80 Q4/20 and 27% compared to Q3/21 60 35 38 80 69 63 70 64 53 55 55 56 57 63 40 60 37 48 40 • EMEIA: Orders grew by 14% compared 20 0 20 0 52 to Q4/20, driven by the Services and
Slide 8: IFRS balance sheet
IFRS balance sheet EUR million Dec 31, 2021 Dec 31, 2020 Key figures Dec 31, 2021 Intangible assets 111.5 73.9 Net debt, EUR million 81.4 Tangible assets 63.6 62.3 Gearing, % 26.8 Right-of-use assets 45.8 50.5 Equity-to-assets ratio, % 45.2 Other non-current assets 31.7 30.6 Debt to capital, % 41.5
Slide 9: Market outlook
Market outlook Market activity in Pulp and Paper projects is expected to continue at a good level. Market activity in the Chemicals and Oil & Gas project business was weak during 2021. The market activity is expected to return to a satisfactory level during the next 6 months. Market activity was sat
Slide 10: Contents
Contents Q4 highlights 2021 Business review Financial review 10 Financial Statements Review 2021
Slide 11: Business highlights of 2021
Business highlights of 2021 • Good market situation continued in Pulp, Paper & Bioproducts projects • Recovery in Services & MRO-driven businesses • Continued progress in developing service concepts • Several product advancements launched • Strengthening position in mining & metals by acquisition of
Slide 12: Contents
Contents Q4 highlights 2021 Business review Financial review 12 Financial Statements Review 2021
Slide 13: Orders, sales and profitability improved, good recovery in Services
Orders, sales and profitability improved, good recovery in Services EUR million % of sales 700 Group key figures – 2021 (2020) • Orders received EUR 625.2 (590.1) million, +6%, in 600 20 comparable currency/organic +7% 500 • Sales EUR 610.9 (576.3) million, +6%, in comparable 15 currency/organic +7%
Slide 14: Neles has shown resilience throughout the cycles
Neles has shown resilience throughout the cycles Orders received, MEUR Orders received CAGR +4.6% CAGR +10.5% -13.3% +6.0% 681 607 591 628 625 577 555 590 518 504 475 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Cost reductions to ensure Multichannel growth Operations improvement and Covid
Slide 15: Improved Services and MRO-driven businesses, continued success in P&P projects
Improved Services and MRO-driven businesses, continued success in P&P projects Business type, Orders received 1 100% CAPEX-driven • Project business growth 2016-2020 • 2021 significant industry 80% differences 60% OPEX-driven • Growth in absolute terms until 2019 Services and 40% • Covid impact in 2
Slide 16: Sales diversification across customer industries
Sales diversification across customer industries Share (%) of Neles 2021 sales Share (%) of Neles 2020 sales Other Other industries1 industries1 16% 16% Oil Oil 24% 27% 10% Pulp, paper 8% Gases Pulp, paper 29% Gases 31% & bio & bio 18% 21% Chemicals Chemicals 1Incl. Mining & Metals, Power, Water tre
Slide 17: Strong free cash flow due to active management of NWC
Strong free cash flow due to active management of NWC Net working capital, EUR million Free cash flow, EUR million 80 0 280 78 Other non- 69 230 84 Proceeds from interest bearing 89 liabilities, net 60 sale of intangible and tangible • Logistics challenges and risks Advances assets 180 received Capi
Slide 18: Good cash conversion
Good cash conversion Capital expenditure1,2, MEUR xx Cash conversion3 261% 155% 123% 52% 142% 137% • 2016–2017: Maintenance investments • 2018–2019: System renewal investments 20 • 2019: System renewal investments continued and investment in new factory in China and some machining capacity additions
Slide 19: Board's dividend proposal
Board’s dividend proposal Dividend proposal of EUR 0.266 per share (EUR 40 million), which corresponds to 70.3% of Neles net earnings ≥5% >€1bn >15% <2.5x ~40% organic orders received EBITA Net Debt/EBITDA of underlying1 growth ambition around 2025 while investing maintaining net earnings paid in gr
Slide 20: 2022 Operative focus
2022 Operative focus • Neles’ new operating model implementation • Flowrox integration • Continued launches of product platform extensions 20 Financial Statements Review 2021
Slide 21: Reinventing reliability
Reinventing reliability @neles @nelesworld @nelesflow @Neles @nelesflow