Wartsila Oyj Abp · OMXHEX:WRT1V

Wartsila Oyj Abp — Q2 2022 Earnings Presentation

35 slides from Wartsila Oyj Abp's earnings presentation, Jul 21, 2022

  1. Slide 1: Half year report January-June 2022

    Wärtsilä Corporation Half year report January-June 2022 Håkan Agnevall, President & CEO Arjen Berends, CFO 21 July 2022 1 © Wärtsilä

  2. Slide 2: Service order intake increased by 36%

    Service order intake increased by 36% ▪ Order intake increased by 25% ▪ Net sales increased by 24% ▪ Good progress in services: ▪ Service order intake increased by 36% ▪ Service net sales increased by 18% ▪ Comparable operating result increased by 20% ▪ Cost inflation, supply chain bottlenecks, Covi

  3. Slide 3: Exit from Russia and optimisation of European engine manufacturing footprint

    Exit from Russia and optimisation of European engine manufacturing footprint ▪ Exit from the Russian market completed ▪ All adjustments and closures were completed in accordance with local regulations ▪ Financial impact in line with the provisions taken in the first quarter, no material impact on ou

  4. Slide 4: Key figures

    Key figures MEUR 4-6/2022 4-6/2021 CHANGE 1-6/2022 1-6/2021 CHANGE Order intake 1,440 1,154 25% 2,820 2,398 18% of which services 811 598 36% 1,543 1,290 20% Order book 5,936 5,238 13% of which current year deliveries 2,732 2,225 23% Net sales 1,407 1,131 24% 2,639 2,078 27% of which services 696 58

  5. Slide 5: Second quarter highlights

    Second quarter highlights Net sales Comparable operating result MEUR %, 12m rolling Net sales EUR 1,407 MEUR MEUR, 12m rolling million 2,000 6,000 180 12.0% 1,800 160 ▪ 18% increase in 1,600 5,000 140 10.0% service sales 1,407 1,400 1,220 4,000 120 8.0% 1,200 1,131 100 1,000 3,000 85 6.0% Comparable

  6. Slide 6: Marine market activity at a good level

    Marine market activity at a good level Investments in new vessels eased due to increased prices, fewer available slots at key shipyards, and uncertainties related to future demand for tonnage ▪ The number of vessels ordered in the review period Total vessel contracting Number of vessels decreased to

  7. Slide 7: Energy market situation

    Energy market situation Markets affected by global cost inflation and price volatility, increasing demand for balancing solutions ▪ Cost inflation and the continuing Covid-19 pandemic have Market for gas and liquid fuelled power plants <500 MW contributed to higher quotation prices. MW, 12m rolling

  8. Slide 8: Order intake increased by 25%

    Order intake increased by 25% Equipment Services MEUR MEUR, 12m rolling MEUR MEUR, 12m rolling 1,600 3,500 1,600 3,500 ▪ Equipment order intake increased by 1,400 3,000 1,400 3,000 13% 1,200 1,200 2,500 2,500 1,000 1,000 ▪ Service order intake 2,000 811 2,000 800 800 increased by 36% 629 1,500 598 1

  9. Slide 9: Strong order book

    Strong order book Despite removal of Russia related projects (MEUR 240) Order book by business Order book delivery schedule MEUR MEUR 7,000 1.40 3,000 6,000 1.20 2,500 5,000 1.00 2,000 4,000 0.80 1,500 3,000 0.60 1,000 2,000 0.40 1,000 0.20 500 0 0.00 0 30.6.2020 31.12.2020 30.6.2021 31.12.2021 30.6

  10. Slide 10: Net sales increased by 24%

    Net sales increased by 24% Equipment Services MEUR MEUR, 12m rolling MEUR MEUR, 12m rolling 1,000 3,000 1,000 3,000 ▪ Equipment net sales 900 900 increased by 31% 2,500 2,500 800 800 700 710 712 700 696 ▪ Service net sales 2,000 2,000 600 543 600 588 increased by 18% 510 500 1,500 500 1,500 400 400

  11. Slide 11: Technology and partnership highlights

    Technology and partnership highlights Enabling industry decarbonisation Partnerships for hydrogen blending with natural gas in engine power plants ▪ Collaboration with Capwatt in Portugal includes testing of up to 10% green hydrogen blends in a Wärtsilä 34SG engine. ▪ In Michigan, USA, fuel blends o

  12. Slide 12: Marine Power

    Marine Power 12 © Wärtsilä

  13. Slide 13: Marine Power: order intake and net sales increased

    Marine Power: order intake and net sales increased Service order intake increased by 36% Order intake Comparable operating result Comparable operating result +21% 12m rolling MEUR MEUR 2,261 MEUR MEUR 12m rolling 10.4% 80 12.0% 800 2,500 600 559 2,000 463 70 391 1,500 + Strong service sales 10.0% 40

  14. Slide 14: Marine Power service agreements

    Marine Power service agreements Net sales from installations under agreement strongly increasing MEUR, 12m rolling 400 Maran Gas extends Optimised Maintenance Agreement by an additional five years 350 ▪ The agreement ensures operational certainty with 300 controlled and predictable costs for 21 TFDE

  15. Slide 15: Marine Systems

    Marine Systems 15 © Wärtsilä

  16. Slide 16: Marine Systems: net sales increased

    Marine Systems: net sales increased Order intake and comparable operating result decreased Order intake Comparable operating result Comparable operating result 12m rolling -24% MEUR MEUR 836 MEUR MEUR 12m rolling 7.6% 400 1,200 40 12.0% 1,000 300 800 183 200 140 600 10.0% 119 400 100 30 200 27 0 0 8

  17. Slide 17: Voyage

    Voyage 17 © Wärtsilä

  18. Slide 18: Voyage: order intake increased

    Voyage: order intake increased Russia exit impacted sales and profitability negatively Order intake Comparable operating result Comparable operating result 12m rolling +8% MEUR MEUR 277 MEUR MEUR 12m rolling –11.1% 100 400 Q221 Q222 5 0.0% 80 65 300 56 60 60 200 40 0 -4.0% 20 100 0 0 + Favourable sa

  19. Slide 19: Voyage cloud solutions

    Voyage cloud solutions Increase of 23% in connected vessels +23% Wärtsilä acquires PortLink Global to accelerate its Number of vessels connected to Smart Port Ecosystem vision our cloud solutions ▪ PortLink is a leading provider of port efficiency solutions, founded in 2007 and headquartered in Vanc

  20. Slide 20: Energy

    Energy 20 © Wärtsilä

  21. Slide 21: Energy: significant improvement in all key figures

    Energy: significant improvement in all key figures Service order intake increased by 56% Order intake Comparable operating result Comparable operating result +51% 12m rolling MEUR MEUR 2,678 MEUR MEUR 7.4% 12m rolling 7.3% 1,200 3,000 70 9.0% 1,000 2,500 800 654 2,000 8.0% 60 600 433 1,500 390 400 1

  22. Slide 22: Wärtsilä to provide MWh energy storage system to help unlock the UK's path towards net zero

    Wärtsilä to provide 100 MWh energy storage system to help unlock the UK's path towards net zero ▪ Wärtsilä will partner with low carbon energy company SSE to deliver a 50 MW / 100 MWh energy storage system in Salisbury, Wiltshire. ▪ The project also includes the GEMS Digital Energy Platform, our sop

  23. Slide 23: Energy service agreements

    Energy service agreements Installed base covered by long-term service agreements increasing MW Wärtsilä performance guarantees will enable Brazilian 16,000 30% power plant to meet its power purchase agreement 14,000 obligations 25% 12,000 ▪ The full Operation and Maintenance (O&M) agreement 20% 10,0

  24. Slide 24: Other key financials

    Other key financials 24 © Wärtsilä

  25. Slide 25: Other key financials

    Other key financials MEUR 4-6/2022 4-6/2021 1-6/2022 1-6/2021 Cash flow from operating activities -90 245 -213 312 Working capital 168 73 Net interest-bearing debt 432 253 Gearing 0.21 0.12 Solvency, % 35.8 37.8 Basic earnings/share, EUR 0.09 0.06 -0.16 0.10 25 © Wärtsilä

  26. Slide 26: Cash flow from operating activities decreased

    Cash flow from operating activities decreased Higher amount of milestone payments expected in H2 Cash flow from operating activities Second quarter development MEUR MEUR, 12m rolling MEUR 800 800 700 700 600 600 500 500 400 400 300 252 245 300 200 200 100 100 0 0 -100 -100 -90 -200 -200 Q220 Q320 Q4

  27. Slide 27: Prospects

    Prospects Wärtsilä expects the demand environment in the third quarter to be better than that of the corresponding period in the previous year. However, the prevailing market conditions make the outlook uncertain. 27 © Wärtsilä

  28. Slide 28: Q&A

    Q&A 28 © Wärtsilä

  29. Slide 29: Appendix

    Appendix 29 © Wärtsilä

  30. Slide 30: Order intake

    Order intake Second quarter development 2% (1) 39% Marine Power (40) Marine Systems Services Order intake 44% Order intake 45% Voyage (48) Equipment (38) by business by business type 56% Energy (52) Portfolio Business 10% 5% (16) (5) 30 © Wärtsilä

  31. Slide 31: Net sales

    Net sales Second quarter development 2% (3) 36% Marine Power (41) Marine Systems Services Net sales Net sales 49% 45% Voyage 51% Equipment by business (48) by business type (52) (37) Energy Portfolio Business 13% 4% (13) (6) 31 © Wärtsilä

  32. Slide 32: Second quarter development by business type

    Second quarter development by business type Order intake Net sales 27% 28% (26) Spare parts (26) Spare parts Marine Field service Marine Field service 38% Businesses 44% Businesses Service agreements Service agreements (46) EUR 764 million (45) EUR 746 million (684) Service projects (706) Service pr

  33. Slide 33: January–June order intake by customer segment

    January–June order intake by customer segment Special Marine Businesses Gas carriers Cruise & ferry Offshore Navy vessels Merchant Other Marine Power Equipment 19% (9) 24% (42) 3% (6) 1% (8) 16% (21) 37% (14) 0% (0) Services 17% (19) 23% (17) 14% (14) 7% (10) 11% (14) 27% (24) 2% (1) Marine Systems

  34. Slide 34: Orders received for Energy equipment globally

    Orders received for Energy equipment globally Europe 114 (46) Asia 50 (42) Americas Utilities 365 (332) IPP’s Africa and (Independent Middle East Power Producers) 71 (40) Industrials Others Equipment order intake 1-6/2022: MEUR 599 (461) 34 © Wärtsilä

  35. Slide 35: WARTSILA

    re, WARTSILA

Wartsila Oyj Abp — Q2 2022 Earnings Presentation on 6ix