Slide 1: Wärtsilä Corporation Result presentation 2015
Wärtsilä Corporation Result presentation 2015, 27 January 2016 Jaakko Eskola, President & CEO
Slide 2: Highlights 2015
Highlights 2015 • Order intake EUR 4,932 million, -3% • Net sales EUR 5,029 million, +5% • Book-to-bill 0.98 (1.06) • EBIT EUR 612 million, 12.2% of net sales (EUR 569 million or 11.9%) • EBITA EUR 643 million, 12.8% of net sales (EUR 594 million or 12.4%) • Cash flow from operating activities EUR 2
Slide 3: Year to date order intake supported by Services
Year to date order intake supported by Services MEUR 5 500 5 000 Fourth quarter development 4 500 MEUR 4 000 1 800 3 500 1 600 1,522 -8% 1,403 3 000 1 400 1 200 2% Services 2 500 1 000 2 000 Marine 800 1% Solutions 1 500 600 1 000 Energy 400 -27% Solutions 500 200 0 0 2011 2012 2013 2014 2015 Q4/201
Slide 4: Net sales developed in line with expectations
Net sales developed in line with expectations MEUR 5 500 5 000 5% Fourth quarter development 4 500 MEUR 4 000 1 800 1,549 1,590 3 500 1 600 3% 3 000 1 400 10% 2 500 1 200 Services 1 000 2 000 Marine 800 8% Solutions 1 500 600 1 000 Energy 400 -14% Solutions 500 200 0 0 2011 2012 2013 2014 2015 Q4/20
Slide 5: Net sales by business 2015
Net sales by business 2015 Services Marine Solutions 43% (41) 34% (36) Energy Solutions 22% (24) 5 27 January 2016 ©Wärtsilä
Slide 6: Book-to-bill ratio
Book-to-bill ratio MEUR 5 500 1,2 1.07 1.05 1.05 1.06 0.98 5 000 4 500 1,0 4 000 0,8 3 500 3 000 0,6 2 500 2 000 0,4 1 500 1 000 0,2 500 0 0,0 2011 2012 2013 2014 2015 Order intake Net sales Book-to-bill 6 27 January 2016 ©Wärtsilä
Slide 7: Order book distribution
Order book distribution MEUR 3 500 3 000 2 500 2 000 1 500 1 000 500 0 31.12.2014 31.12.2015 Delivery next year Delivery after next year 7 27 January 2016 ©Wärtsilä
Slide 8: Operating result and profitability
Operating result and profitability MEUR 700 14% 12.2% 11.9% 600 11.2% 12% 11.1% 10.9% 500 10% 400 8% 300 6% 200 4% 100 2% 0 0% 2011 2012 2013 2014 2015 EBIT EBIT% EBIT is shown before non-recurring items. Figures for 2011-2013 include both discontinued and continuing operations. 8 27 January 2016 ©W
Slide 9: Energy Solutions
Energy Solutions i
Slide 10: Energy Solutions' quotation activity on a high level
Energy Solutions’ quotation activity on a high level MW 18 000 16 000 14 000 12 000 10 000 Multi-fuel 8 000 Gas 6 000 Liquid fuel 4 000 2 000 0 Q1/2012 Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 10 27 January 2016 ©Wärtsilä
Slide 11: Energy Solutions' order intake
Energy Solutions’ order intake MEUR Review period development 1 800 Total EUR 1,009 million (1,293) 1 600 Utilities 1 400 IPP’s 1 200 (Independent Power Producers) 1 000 Industrials 800 600 Review period order intake by fuel in MW 400 200 Oil Gas 0 54% 46% 2011 2012 2013 2014 2015 Q1-Q3 Q4 11 27 Jan
Slide 12: Energy Solutions' orders globally
Energy Solutions’ orders globally Europe 1,042* (769) 4 Asia 299 (394) 58 31 980 103 165 Americas 638 (686) 220 418 Africa and Middle East 457 (639) 65 Utilities 137 254 IPP’s Industrials Order intake 2015: 2,436 MW (2,489) *Turkish owners contributed to the high level of activity in Europe. 12 27 J
Slide 13: Enabling the transition to a sustainable power system
Enabling the transition to a sustainable power system The flexibility and efficiency of Wärtsilä’s Smart Power Generation power plants is gaining interest in the USA with several orders received for peaking and renewable support power plants during 2015.
Slide 14: Market for gas and liquid fuel power plants, <500 MW
Market for gas and liquid fuel power plants, <500 MW 1-9/2014 1-9/2015 Alstom Other GT’s Ansaldo Other GT’s Ansaldo 1.8% 1.8% 0.8% 3.6% 5.5% Wärtsilä Wärtsilä 9.9% 10.5% GE GE 55.1% 38.8% Siemens 12.7% MHI 19.8% MHI 14.6% Siemens 25.2% <500 MW market volume: 17.0 GW (16.5), +3% Total market volume:
Slide 15: Marine Solutions
Marine Solutions
Slide 16: Vessel contracting activity remains low
Vessel contracting activity remains low Merchant Offshore Cruise and Ferry Special vessels 3 months moving average in CGT * 250 5,0 4,5 200 4,0 3,5 Number of vessels Million CGT* 150 3,0 2,5 100 2,0 1,5 50 1,0 0,5 0 0,0 12.15 01.09 03.09 05.09 07.09 09.09 11.09 01.10 03.10 05.10 07.10 09.10 11.10 01
Slide 17: Marine Solutions' order intake
Marine Solutions’ order intake MEUR 1 800 Review period development Total EUR 1,599 million (1,746) 1 500 Offshore 1 200 8% Gas carriers Special vessels 38% 10% 900 600 Cruise & Ferry 15% 300 Navy 4% 0 2011 2012 2013 2014 2015 Others Traditional merchant 6% 18% Q1-Q3 Q4 17 27 January 2016 ©Wärtsilä
Slide 18: Joint venture ordering activity
Joint venture ordering activity MEUR 700 600 500 400 300 200 100 0 Q1/2010 Q2/2010 Q3/2010 Q4/2010 Q1/2011 Q2/2011 Q3/2011 Q4/2011 Q1/2012 Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Marine Solutions order intake Joint ventu
Slide 19: Marine Solutions' order book 31 December 2015
Marine Solutions’ order book 31 December 2015 Bulk carriers Other merchant Containers 2% 2% Cargo 3% RoRo 1% Offshore 4% 17% Tankers 5% Gas carriers Cruise & Ferry 27% 16% Navy 12% Other vessels Special vessels 2% Non- vessel 7% 3% 19 27 January 2016 ©Wärtsilä
Slide 20: Marine markets shifting towards gas
Marine markets shifting towards gas Increased environmental awareness and the regulatory environment is driving interest in gas as a marine fuel in the broader marine markets. Wärtsilä’s proven gas engine technology and gas handling systems enable us to support our customers with integrated solution
Slide 21: Strong position in marine engine market
Strong position in marine engine market Medium-speed main engines Auxiliary engines Wärtsilä Others 12% (9) 18% (16) Caterpillar 7% (13) Wärtsilä Others 59% (63) 88% (91) MAN D&T 16% (8) Total market volume last 12 months: Total market volume last 12 months: 3,246 MW (4,519) 4,668 MW (3,986) Wärtsil
Slide 22: Services
| . Services
Slide 23: Services net sales all time high
Services net sales all time high MEUR 2 400 2 200 2 000 13% Fourth quarter development 5% -3% 5% 1 800 MEUR 700 1 600 619 1 400 600 564 1 200 10% 500 1 000 400 800 300 600 400 200 200 100 0 0 2011 2012 2013 2014 2015 Q4/2014 Q4/2015 Q1-Q3 Q4 23 27 January 2016 ©Wärtsilä
Slide 24: Services net sales distribution 2015
Services net sales distribution 2015 Field service 23% (25) Spare parts 51% (51) Agreements 16% (16) Projects 10% (9) Total EUR 2,184 million (1,939) 24 27 January 2016 ©Wärtsilä
Slide 25: Services distribution per business 2015
Services distribution per business 2015 Net sales Installed base Total EUR 2,184 million Total 181,000 MW Energy Solutions Marine Energy Marine Solutions Solutions Solutions 2-stroke Marine Solutions 4-stroke 25 27 January 2016 ©Wärtsilä
Slide 26: Development of service agreements
Development of service agreements 14 000 30% 12 000 25% 10 000 20% 8 000 MW 15% 6 000 10% 4 000 5% 2 000 0 0% 2009 2010 2011 2012 2013 2014 2015 MW under agreement – Energy Solutions MW under agreement – Marine Solutions % of Energy Solutions’ installed base % of Marine Solutions’ installed base 26
Slide 27: A lifecycle approach
A lifecycle approach The focus on optimising maintenance and performance, and the shift to gas based technology in the marine industry is increasing interest in long-term service agreements.
Slide 28: Financials
Financials
Slide 29: Cash flow from operating activities
Cash flow from operating activities MEUR 700 600 500 400 300 200 100 0 2011 2012 2013 2014 2015 29 27 January 2016 ©Wärtsilä
Slide 30: Working capital affected by timing of power plant deliveries
Working capital affected by timing of power plant deliveries MEUR 1 600 25% 1 400 20% 1 200 1 000 15% 800 10.8% 9.8% 600 465 543 10% 5.6% 6.8% 400 313 5.2% 235 251 5% 200 0 0% 2011 2012 2013 2014 2015 Working capital Total inventories Advances received Working capital / Net sales 30 27 January 2016
Slide 31: Gearing impacted by working capital build up and L-3 MSI acquisition
Gearing impacted by working capital build up and L-3 MSI acquisition 0,50 0,40 0,30 0,20 0,10 0,00 2011 2012 2013 2014 2015 31 27 January 2016 ©Wärtsilä
Slide 32: EPS and dividend per share
EPS and dividend per share 2,5 2.25 2,0 1,5 1.20 1,0 0,5 0,0 2011 2012 2013 2014 2015* EPS Dividend * Dividend 2015 - Proposal of the Board 32 27 January 2016 ©Wärtsilä
Slide 33: Market outlook
Market outlook Energy Solutions Marine Solutions Services The market for liquid and gas fuelled The outlook for the shipping and The service market outlook is positive power generation is expected to remain shipbuilding markets remains with growth opportunities in selected challenging as economic un
Slide 34: Prospects for 2016
Prospects for 2016 Wärtsilä expects its net sales for 2016 to grow by 0-5% and its operational profitability (EBIT% before non-recurring items) to be 12.5-13.0%.
Slide 35: Wärtsilä's strategy
GROWING Key GROWTH AREAS oe Sy, GLOBAL TRANSPORTATION NEEDS re WARTSILA
Slide 36: Thank you
Thank you IR Contact: Natalia Valtasaari Director, Investor & Media Relations Tel. +358 (0) 40 187 7809 E-mail: natalia.valtasaari@wartsila.com