Valmet Corp · OMXHEX:VALMT
Valmet — Non-Deal Roadshow (March 2023)
38 slides from Valmet's roadshow presentation, March 2023
Slide 1: Valmet – unique offering to support a growing market
Valmet – unique offering to support a growing market Roadshow presentation March 2023
Slide 2: Agenda
Agenda Valmet roadshow presentation 1 Valmet in brief 2 Investment highlights 3 Financial targets and acquisitions 4 Q4/2022 financials, guidance and short-term market outlook 5 Summary 2 March 2023 © Valmet | Roadshow presentation
Slide 3: Valmet in brief
Valmet in brief Valmet <>
Slide 4: Valmet's offering is unique and the widest in the market
Valmet’s offering is unique and the widest in the market Board and tissue Pulp Energy • Board, paper and tissue production lines • Wood and pulp handling • Heat and power generation • Rebuilds • Fiber processing • Air emission control • Stand-alone products • Recovery • Biofuels Process technology A
Slide 5: We have strong market positions
We have strong market positions Process technologies Services Automation Board and Pulp and Flow Control Automation Tissue Energy Systems Market position Market position Market position Market position Market position Pulp Energy Pulp and Energy and #1 #1–2 Pulp and Renewable paper process #2 #1-3 p
Slide 6: Valmet's development since 2013
Valmet’s development since 2013 Orders received Net sales Comparable EBITA Comparable EBITA margin (EUR billion) (EUR billion) (EUR million) (%) 5.5 5.5 600 12% 5.0 5.0 4.5 4.5 500 10% 4.0 4.0 3.5 3.5 400 8% 3.0 3.0 300 6% 2.5 2.5 2.0 2.0 200 4% 1.5 1.5 1.0 1.0 100 2% 0.5 0.5 0.0 0.0 0 0% 2013 2016
Slide 7: Valmet in 2022
Valmet in 2022 Net sales by segment Net sales by area Orders received EUR 5,194 million 12% 21% Net sales 32% EUR 5,074 million 16% Comparable EBITA 48% EUR 533 million 14% Comparable EBITA margin 10.5% 20% Order backlog 37% EUR 4,403 million Services North America Employees South America 17,548 Aut
Slide 8: Valmet has three strong segments
Valmet has three strong segments Net sales Comparable EBITA Comparable EBITA margin (excl. Other) (excl. Other) EUR EUR 14.8% 1,606 145 EUR million EUR million 237 2,428 million million 18.3% EUR EUR 1,040 190 million million 6.0% Services Services Services Automation Automation Automation Process T
Slide 9: Global presence creating a good platform for growth in Services and Automation
Global presence creating a good platform for growth in Services and Automation EMEA 10,787 employees ~140 service centers China 2,323 employees 54 North America production units 2,040 employees 24 R&D centers Asia-Pacific 8 1,565 employees Performance South America Centers 833 employees Personnel as
Slide 10: Valmet's Way Forward
Valmet’s Way Forward Vision Continuous improvement and To become the global champion in serving our customers and in Strategy renewal moving the industries forward Valmet develops and supplies competitive and Must-Wins reliable process technologies, services and Customer excellence automation to t
Slide 11: Valmet's R&D is aiming to address global megatrends
Valmet’s R&D is aiming to address global megatrends R&D focus areas • Promotion of renewable materials • Raw material, water and energy efficiency • Emission reductions • Circularity • Productivity and environmental improvements with digitalization 28 EUR 95 million ~1,300 research and R&D spending
Slide 12: Acknowledged leader in sustainability
Acknowledged leader in sustainability 360º approach to sustainability across value chain Environmental Engaged efficiency workplace Good sustainability ratings In Dow Jones Sustainability Index for the Climate Health and safety ninth consecutive year AAA rating in the MSCI ESG Ratings assessment
Slide 13: Valmet's Climate Program: Forward to a carbon neutral future
Valmet´s Climate Program: Forward to a carbon neutral future Targets by 2030 for the entire value chain SUPPLY CHAIN OWN OPERATIONS USE PHASE OF VALMET’S TECHNOLOGIES -20% -80% -20% 100% CO2 emission reduction CO2 emission reduction Further reduced energy use Carbon neutral production of Valmet’s cu
Slide 14: Investment highlights
Investment highlights Valmet <>
Slide 15: Valmet's investment highlights
Valmet’s investment highlights 1 Unique offering to support a growing market 2 Process Technologies segment benefiting from the growing demand for bio-based products and energy 3 EUR 2.8 billion recurring and steadily growing stable business 4 Services segment’s demand driven by large and growing gl
Slide 16: Unique offering to support a growing market
Unique offering to support a growing market Unique offering Strong market drivers Competitive advantage from Process Technologies • E-commerce and global trade the widest offering in the market • Renewable materials replacing plastic packaging • Conversions from paper to board • Energy transition an
Slide 17: Process Technologies segment benefiting from growing demand for bio-based products and energy
Process Technologies segment benefiting from the growing demand for bio-based products and energy New pulp and paper capacity is needed as demand for bio- Net sales (EUR million) based products continues to grow 2,428 Energy transition creates a growing market for Valmet’s 2,079 2,163 1,799 1,83
Slide 18: EUR 2.8 billion recurring and steadily growing stable business
EUR 2.8 billion recurring and steadily growing stable business • Valmet’s stable business has grown Orders received (EUR million) steadily since 2014 3,000 2,837 • Future growth possibilities are supported 1,081 by favorable megatrends 2,500 • Stable business provides resilience to 2,000 1,875 1,947
Slide 19: Services segment's demand driven by large and growing global installed base
Services segment’s demand driven by large and growing global installed base Orders received (EUR million) Valmet’s Services is a growing and recurring CAGR business 2,000 ~5% 1,756 1,459 1,481 Demand driven by large and growing global installed 1,500 1,119 1,182 1,242 1,315 1,356 1,035 1,055 bas
Slide 20: Automation segment with high growth and profitability
Automation segment with high growth and profitability Valmet’s Automation is a growing and recurring Orders received (EUR million) business 1,200 Large addressable target market estimated to grow 1,000 800 576 ~3% annually 600 Target to continue to grow over two times the market 400 505 200 36
Slide 21: Future growth possibilities from new sustainable innovations
Future growth possibilities from new sustainable innovations Textile fibres Valmet 3D fibre New bioproducts Flow Control and Automation Systems Technology to produce Next generation of molded Lignin usage to replace Solid position to grow in viscose pulp from recycled fiber fossil-based carb
Slide 22: Building Valmet on positive megatrends and strategy of renewal and continuous development
Building Valmet on positive megatrends and strategy of renewal and continuous development Demand for bio-based New growth Steadily growing products and energy Strategy opportunities stable business continues to grow The large pulp and paper Future growth EUR 2.8 billion stable Strong track r
Slide 23: Financial targets and acquisitions
Financial targets and acquisitions
Slide 24: Financial targets
Financial targets Growth Profitability ROCE Dividend policy Net sales for Services and Comparable EBITA: Comparable return on Dividend payout at least Automation segments to 12–14% capital employed (ROCE) 50% of net profit grow over two times the before taxes1 at least 15% market growth Net sales fo
Slide 25: Concrete actions to reach Comparable EBITA target of 12–14% through must-wins
Concrete actions to reach Comparable EBITA target of 12–14% through must-wins Customer Technology Processes People Grow stable business Leverage strong R&D Ensure good project Increase procurement, over two times the for new product operations to reach a production and market growth innovati
Slide 26: Improvement in Comparable EBITA is the biggest driver for ROCE
Improvement in Comparable EBITA is the biggest driver for ROCE Main drivers for ROCE: Track record • Improvement in Comparable Capital employed (EUR million) Comparable ROCE (%, before taxes) EBITA is the biggest driver for ROCE Equity Interest-bearing liabilities ROCE • Capital employed increased i
Slide 27: Valmet has paid attractive dividend
Valmet has paid attractive dividend DPS Payout target at least 50% of net Payout % 1.30 profit Payout % target, at least 50% 1.20 Target has been exceeded every year 81% 0.90 68% 76% 68% 0.80 68% Constant dividend growth 64% 59% 61% 58% 0.65 0.55 0.42 Total payout (EUR) 0.25 0.35 in dividends
Slide 28: Opportunities to strengthen segments through acquisitions
Opportunities to strengthen Services, Automation and Process Technologies segments through acquisitions Strong track record of successful acquisitions Acquisition strategy • Opportunities to strengthen Services, Automation and • Ten acquisitions made since becoming an independent Process Technologie
Slide 29: Q4/2022 financials, guidance and short-term market outlook
Q4/2022 financials, guidance and short- term market outlook
Slide 30: Key figures
Key figures EUR million Q4/2022 Q4/2021 Change 2022 2021 Change Orders received 1,385 1,093 27% 5,194 4,740 10% Order backlog1 4,403 4,096 7% 4,403 4,096 7% Net sales 1,540 1,199 28% 5,074 3,935 29% Comparable EBITA 196 147 33% 533 429 24% % of net sales 12.7% 12.2% 0.5 pp 10.5% 10.9% -0.4 pp EBITA
Slide 31: Segment key figures
Segment key figures Orders received, EUR million Q4/2022 Q4/2021 Change 2022 2021 Change Services 418 387 8% 1,756 1,481 19% Automation 324 119 >100% 1,081 467 >100% Process Technologies 644 587 10% 2,356 2,793 -16% Total 1,385 1,093 27% 5,194 4,740 10% Net sales, EUR million Q4/2022 Q4/2021 Change
Slide 32: Comparable EBITA margin development
Comparable EBITA margin development Net sales and Comparable EBITA (EUR million and %)1 Target 12–14% 5,074 10.9% 10.5% 8.9% 9.8% 7.7% 3,935 3,740 3,325 3,547 2,928 2,926 3,058 Capital Business 2,473 7.1% 2,428 6.7% Stable business 6.2% 4.3% 2,646 1,832 2,079 2,163 1,473 1,584 1,799 Comparable EBITA
Slide 33: Strong balance sheet enabling solid operations, dividends and growth
Strong balance sheet enabling solid operations, dividends and growth also through acquisitions Net debt Gearing Net debt to EBITDA ratio 502 1.25 500 50% 40% 1.00 0.84 400 0.78 300 30% 21% 0.75 20% 178 20% 0.50 0.35 200 149 13% 0.22 52 10% 6% 0.25 100 0 0% 0.00 -100 -10% -0.25 -0.17 -100 -90 -88 -9%
Slide 34: Guidance and short-term market outlook
Guidance and short-term market outlook Guidance for 2023 Guidance Valmet estimates that net sales in 2023 will increase in comparison with 2022 (EUR 5,074 million) and Comparable EBITA in 2023 will increase in comparison with 2022 (EUR 533 million). Short-term market outlook Q1/2022 Q2/2022 Q3/2022
Slide 35: Summary
Summary Valmet <>
Slide 36: Valmet's investment highlights
Valmet’s investment highlights 1 Unique offering to support a growing market 2 Process Technologies segment benefiting from the growing demand for bio-based products and energy 3 EUR 2.8 billion recurring and steadily growing stable business 4 Services segment’s demand driven by large and growing gl
Slide 37: Important notice
Important notice It should be noted that certain statements herein which are not historical facts, including, without limitation, those regarding expectations for general economic development and the market situation, expectations for growth, profitability and investment willingness, expectations fo
Slide 38: FORWARD
FORWARD