Wartsila Oyj Abp · OMXHEX:WRT1V

Wartsila Oyj Abp — Wärtsilä — Non-Deal Roadshow (May 2024)

103 slides from Wartsila Oyj Abp's roadshow presentation, May 2024

Slide 1: Shaping the decarbonisation of marine and energy
Wärtsilä Shaping the decarbonisation of marine and energy Roadshow presentation May 2024 1 ©
Slide 2: Wärtsilä – Shaping the decarbonisation of marine and energy
Wärtsilä – Shaping the decarbonisation of marine and energy Wärtsilä simplified the Marine Energy Committed to financial targets Group structure from 1st Our offering of engines, propulsion We support the change towards a Net sales January 2024 onwards systems, hybrid technologies and future where e
Slide 3: Market fundamentals
Market fundamentals Marine will move with unprecedented speed towards decarbonisation Policies & regulations Technology Connectivity & data ▪ IMO target/ EU Regulations ▪ Carbon neutral and zero ▪ Vessels as data pools ▪ Access to capital carbon fuels ▪ Optimisation solutions ▪ Cost of carbon ▪ Carb
Slide 4: Our value creation potential is based on two strategic themes
Our value creation Transform – Perform – potential is based attractive growth clear path for opportunities at operational on two strategic the center of the improvements themes decarbonisation transformation and increased profitability 4 ©
Slide 5: Significant milestones reached in strategy execution
Significant milestones reached in strategy execution 1) 2023 vs. 2021 net sales Transform Perform ▪ Market leader in: ▪ Good growth in service agreements by leveraging digital solutions − 4-stroke medium speed main engines − Engine power plants ▪ Improved quality of new build order book margins − Ma
Slide 7: Strong market fundamentals will support profitable growth in Marine business
Strong market fundamentals and the decarbonisation transformation will support profitable growth in Marine business Key target segments Decarbonisation drivers Annual newbuild contracting of 4-stroke medium speed main engine- powered units (GW)1); CAGR ▪ IMO MEPC 80 has adopted a revised strategy to
Slide 8: Wärtsilä is a global technology and service leader in shaping decarbonisation of marine
Wärtsilä is a global technology and service leader in shaping the decarbonisation of marine #1 #1 Pioneer +60% of net sales3) Industry leading medium Industry leading hybrid Pioneer in carbon capture & Global services network to speed engine offering solutions storage ensure maximum uptime & fuel ef
Slide 9: Renewables and balancing power will support profitable growth in Energy business
The increasing share of renewables and need for balancing power will support profitable growth in Energy business Thermal balancing Energy storage Market drivers Addressable market Addressable market GW; CAGR GWh; CAGR ▪ Thermal balancing market is expected to grow +4X by 2030 driven by accelerating
Slide 10: Global leader in engine power plants; Energy Storage & Optimisation profitable
Wärtsilä is a global leader in engine power plants. Energy Storage & Optimisation has grown ~3X since 2021 and is now profitable #1 #1-5 +40% of net sales2) Industry leading engine power plants1) Top 5 in energy storage Global services network to ensure maximum uptime & fuel efficiency ▪ Superior op
Slide 11: Strategic review of Energy Storage & Optimisation
To support accelerated profitable growth of Energy Storage & Optimisation, we have launched a strategic review of the business ▪ Energy storage market is expected to grow rapidly, addressable market to grow +3X from 2022 to 2030 ▪ Wärtsilä Energy Storage & Optimisation has grown +30X1) since the acq
Slide 13: Services is ~50% of our net sales with good growth potential
Services is ~50% of our net sales with good future growth potential EUR ~3bn 26% ~90% 2023 net sales Growth in net sales since 2021 Renewal rate of service agreements Source: CMD 2023 13 ©
Slide 14: Executing services strategy on the service value ladder
We continue to execute our services strategy on all steps of the service value ladder ▪ Our installed base of medium speed engines is increasing (~5% increase since 2021) ▪ 26% growth in transactional services since 2021 ▪ ~30% of installed base2) is under service agreements with further growth pote
Slide 15: Benefiting from operational improvements and structural changes
Going forward we will benefit from the implemented operational improvements and structural changes Quality of revenues ▪ Improved quality of new build margins in current order book ▪ Energy order book has higher share of equipment and lower share of EPC deliveries ▪ Energy Storage & Optimisation is
Slide 16: Strong commitment and a clear path to reach our financial targets
Strong commitment and a clear path to reach our financial targets 12% 5% <0.5 ≥50% Operating margin Annual organic Gearing Dividend of growth earnings 16 ©
Slide 17: Energy transition driving our >5% organic growth target
Energy transition and decarbonisation driving our >5% organic growth target LTM Q3/2023 net sales EUR 6.1bn Drivers of net sales growth1) Share of absolute growth ▪ Energy Storage & Optimisation − Fast growing demand for energy storage and power system optimisation solutions ▪ Marine newbuild driven
Slide 18: Services and decarbonisation key drivers towards 12% operating margin
Services and decarbonisation key drivers towards 12% operating margin LTM Q3/2023 operating margin 6.0%1) Drivers of improved profitability2) Share of absolute improvements ▪ Moving up the service value ladder in Marine and Energy ▪ Marine new build driven by decarbonisation ▪ Energy Engine Power Pl
Slide 19: Actively managing our business portfolio
We continue to actively manage our business portfolio Marine Systems discontinued Portfolio Business Effective 1st of January 2024 Plan to divest. Timeline subject to internal separation & turnaround ▪ Further simplification of Group structure ▪ Water & Waste ▪ Gas Solutions has limited synergies wi
Slide 20: Marine & Energy Engine Power Plants have double digit profitability
Marine & Energy Engine Power Plants combined have double digit profitability. Energy Storage & Optimisation is now profitable Group simulation (LTM Q3/2023), net sales EURbn Comparable operating margin 10.5% 0.3% 8.7% 7.7% LTM Q3/2023 Operating margin 10.0% 0.1% 8.2% 6.0% LTM Q3/2023 Net sales CAGR
Slide 21: Profitability drivers
Profitability drivers + Supporting drivers + / - Uncertainties - Negative factors ▪ Continued decarbonisation in both ▪ Geopolitical tensions ▪ Wage inflation the energy and marine markets ▪ Potential trade restrictions / ▪ Good service performance trade wars ▪ Strong order book both in new ▪ Recess
Slide 22: Strong balance sheet and financial position
Strong balance sheet and financial position to support strategy execution Cash flow from operating Working capital (EURm) Gearing Solvency ratio activities (EURm) % of sales Net interest-bearing debt Net interest bearing debt % of sales (EURm) (EURm) 30% 15% 15% 14% 14% 4% 6% 23% 3% -1% 41% -2% 38%
Slide 23: The Wärtsilä Way sets the scene for profitable growth
The Wärtsilä Way sets the scene for profitable growth. We reconfirm our financial targets 23 ©
Slide 24: Strategic priorities are the key levers to improve performance
The strategic priorities are the key levers to improve our performance and reach our target position 1 Excel in creating customer value We continuously evolve our understanding of, and responsiveness to, our customers to make them successful Develop high performing teams that make a difference 2 We
Slide 26: Regulatory focus has moved to mid-term measures
After IMO net-zero commitment last year, the regulatory focus has moved to “mid-term measures” For vessels operating in EU waters, fuel cost may double due to emission fees up to 2030, compared to 2023 IMO GHG Strategy1) EU Fit-for-55 GHG emission reduction % vs 2008 Fuel-related costs for Handymax
Slide 27: A progressive switch to sustainable fuels is under way
A progressive switch to sustainable fuels is already under way Sustainable fuel uptake scenario for net-zero in 20501) Fuel transition is under way: ~50% of Total energy consumption, EJ tonnage on orderbook is set to use alternative fuels; long-term fuel mix is 15 dependent on supply of different fu
Slide 28: Half of shipbuilding orderbook set to run on alternative fuels
The regulatory changes impact maritime now: half of the total shipbuilding orderbook is set to run on alternative fuels 2023 saw the highest-ever alternative fuel capable vessel ordering, excluding gas carriers Alternative fuels uptake Orderbook by fuel type, mGT1) 250 50% ~50% 200 40% vessel GT ord
Slide 29: Sustainable fuels roadmap to 2050
Sustainable fuels roadmap to 2050 In Wärtsilä, alternative fuel-capable engines account for >60% MW ordered in 2023 29 ©
Slide 30: Cost of emissions will close price gap between fuels
Cost of emissions will close the price gap between fossil and sustainable fuels; fuel selection impacts the vessel structure Fuel type Low Sulphur Liquified Methanol Ammonia Liquid Compressed Marine Fuel Oil Natural Gas @ 20°C @ -33°C Hydrogen Hydrogen Battery Rack @ 20°C @ -162°C @ -253°C @ 350bar
Slide 31: We focus on the most high-value, performance-driven segments
We focus on the most high-value, performance-driven segments Typical Wärtsilä Marine offering per vessel1) Cruise Ferries Offshore Navy Specials Merchant Hy-El merchant Engines / Diesel-Electric Main Engines Hybrid-Electric Aux Engines Main Engines Aux Engines Hybrid-Electric Hybrid1) Aux Engines Ma
Slide 32: Market share stronger on alternative fuel capable engines
Our market share is stronger on alternative fuel capable engines compared to diesel engines 4-stroke medium speed main engines market share1) Auxiliary engines market share1) ~45% ~15% ~75% ~25% We are market We are growing in leaders in 4-stroke auxiliary engines, as medium speed main EUR ~2bn engi
Slide 33: Recovery in key segments will double 4-stroke main engine market
Recovery in our key target segments will double the 4-stroke medium speed main engine addressable market by 2030 compared to 2023 Newbuild ordering of 4-stroke medium speed main engines, MW1) Wärtsilä market share, MW3) 13% CAGR Cruise 6 000 Ferries Cruise ~85% 5 000 Offshore Merchant 4 000 Ferries
Slide 34: Global cruise capacity forecast to grow over 10%
Global cruise capacity is forecast to grow over 10% from 2024 to 2028 Cruise passengers, million passengers Cruise travel reached 107% of 2019 levels in 2023, with 37,1 38,9 39,4 31.7 million passengers 29,7 31,7 35,7 sailing; this compares to 20,4 overall international tourism 5,8 arrivals, which a
Slide 35: Hybrid-Electric will challenge 2-stroke for LNG carriers
Hybrid-Electric will challenge 2-stroke as prime-mover for LNG carriers, enabling higher efficiency and increased cargo capacity Wärtsilä Hybrid-Electric LNG carrier Launched at Gastech in 2023 with Shell and Hudong-Zhonghua Shipbuilding 185k cbm capacity 3x 4-stroke spark-gas gensets 6% extra cargo
Slide 36: Vessel contracting forecast
Vessel contracting forecast No of ships, 2,000+ dwt/GT, Continuing accelerated fleet renewal Ship-shaped mobile offshore vessels only. Accelerating fleet renewal and supported by the fleet age profile and steady demand growth potential increased consensus over supported by gradual fuelling and techn
Slide 37: Services is more than 60% of Marine Power sales
Servicesisismore Services morethan than60% 60%of ofMarine MarinePower sales sales. Wehave We have33distinct distinctrevenue revenuestreams streamscovering coveringcustomer customermaintenance maintenance Transactional Agreements Retrofit Projects % services ~60% ~30% ~10% sales1) Increasing ship com
Slide 38: Moving up our service value ladder
We increase sales and profits by moving up our service value ladder From 1x1) Up to 2-3x1) Guaranteed asset Optimised performance maintenance agreement Technical management agreement AI-based Expert Insight Enhanced support agreement AI-based Expert Insight Operational support Data-driven dynamic ag
Slide 39: Installations under agreement grew by 38% since 2019
Installations under agreement grew by 38% since 2019; healthy 90% renewal rate Number of vessels under agreement, by agreement scope1) 900 +38%  TMA / ESA 26% Tech. Maintenance / Enhanced Support Agreement growth in sales to 800 + Connectivity solutions agreement vessels 700 + Maintenance planning
Slide 40: Installed base generates revenues over 30 years
Our installed base generates revenues during over 30 years; it grew by 9% over 2019-23 Marine 4-stroke installed base development Marine 4-stroke installed base, GW1) >3,000 +9% customers groups buy from 60 us at least once a year 55 +9% 4-stroke engine installed 50 base growth since 2019 +7% 45 num
Slide 41: Vessel utilisation rates driving service business
Vessel utilisation rates driving Wärtsilä’s service business Cruise and passenger ferries Offshore 100 100 1 800 Using slow steaming to 90 90 1 600 manage active fleet 80 80 1 400 capacity and/or to limit MDU Utilisation, % Cruise Idle capacity, % # Laid-up OSVs 70 70 1 200 60 Passenger ferries 60 1
Slide 42: Tightening regulations will boost demand for retrofits
Tightening regulations and increasing fuel and emission cost will boost demand for retrofits Total investments in retrofits are estimated to be EUR 15-20bn over the next decade1) Propulsion Alternative fuel Radical power Electrification efficiency upgrades conversions derating projects 53% Propulsio
Slide 43: Onboard Carbon Capture and Storage
Onboard Carbon Capture and Storage (CCS) allows to capture >70% of the CO2 generated onboard Onboard CCS can unlock EUR Hei ~10bn Hanna,business in the next 10 years 1) mitä kuuluu, toivottavasti siellä kaikki hyvin, ei olla hetkeen nähty. Applicable to all carbon-based fuels, vessels types and size
Slide 44: Strong growth opportunities in marine
Strong growth opportunities in marine based on technology leadership, moving up the service value ladder, and favorable vessel contracting mix Equipment Services Addressable Favorable vessel Decarbonisation- market contracting mix driven retrofits Growing installed base Decarbonisation: uptake of Ma
Slide 46: Significant value creation opportunity
Significant value creation opportunity – improving performance and capturing growth Perform – on track to deliver our Transform – growth opportunity Transform – growth opportunity targets in Engine Power Plants in Energy Storage & Optimisation ▪ Driving performance in new build ▪ Thermal balancing a
Slide 47: Actions taken to improve new build profitability
Actions taken to improve new build profitability and achieve better risk / reward Organisation, team & governance ▪ New organisation structure with three global Business Units with P&L responsibility ▪ Significant changes in Energy management & leadership ▪ Energy has implemented new governance: - U
Slide 48: Balancing solutions are key enablers for renewable transition
As the renewable energy transition accelerates, balancing solutions are key enablers for the transition Share of renewables in global energy generation Technology disruption in the energy sector Renewables Other Renewable generation 1) Renewables becoming main source of power 8X Gradual replacement
Slide 49: Thermal balancer market expected to grow ~20% per year
Thermal balancer market expected to grow ~20% per year – the baseload market outlook remains stable Engine power plant - baseload Engine power plant - balancers Outlook Addressable annual market (GW) Addressable annual market (GW) 1) ▪ The transition towards renewables is the driving +19% p.a. force
Slide 50: Engine power plants in strong position as balancing market grows
Engine power plants are in a strong position as the balancing market grows. Power system knowledge makes Wärtsilä the go-to partner for capacity planning Engines superior to Gas Turbines for Wärtsilä is clear market leader in engine Wärtsilä in strong position as balancing power plants thermal balan
Slide 51: Case Texas shows future trends
Case Texas shows future trends. Increasing renewables creates need for balancing with engines outperforming competing technologies 30 million population with 133 GW of 1.6X higher¹ real time market revenue Texas as a proofpoint for installed power (system size equal to France) potential for engines
Slide 52: Energy storage growth outlook remains strong
Energy storage growth outlook remains strong Order intake Market outlook Outlook Order intake (GWh) Addressable annual market (GWh) 1) ▪ Focus on profitable growth. Maintain top 5 market position +17% p.a. +35% ▪ Strong new build sales growth expected, driven by market demand ▪ >11 GWh energy storag
Slide 53: Energy Storage has grown 3X and is now profitable
Energy Storage has grown 3X1) since 2021 and is now profitable – key focus on commercial approach and differentiated offering Selective commercial approach ▪ Focusing on growth of utility scale storage in selected geographies ▪ Systematic project selection to drive profitability Differentiated offer
Slide 54: Continued good profitability in services
Continued good profitability in services with a solid foundation for future growth Service order intake, MEUR Energy services – growth drivers +19% p.a. MEUR 1,306 ▪ Growing installed base 1 200 over time 1,062 915 ▪ Stable total operating 1 000 Service projects hours Service agreements ▪ Increasing
Slide 55: Moving up the service value ladder in Energy
We increase sales, profitability and customer satisfaction by moving up the service value ladder Wärtsilä service value ladder Continuous growth in agreement coverage Sales EUR/kW relative to transactional ▪ Securing service agreements for new power plants 5x ▪ Maintaining high renewal rate for exis
Slide 56: Future performance drivers
Future performance will be driven by strong sales growth and service volumes, continuous improvement, and a future-proof solution portfolio New build margins New build sales Recent actions: New organisation & governance Strong thermal balancing growth New organisational Stronger risk management Stro
Slide 57: Advantages of Wärtsilä power plants over combined cycle gas turbines
Advantages of Wärtsilä power plants over combined cycle gas turbines Faster startup time Higher ramp rate ▪ Combined cycle gas turbines can take over 30 minutes to ▪ Ramp rate = the rate at which a power plant can increase or start, whereas combustion engine power plants can start and decrease outpu
Slide 59: Continuing investing in innovation
We continue investing in innovation to ensure a broad, industry-leading solution offering 4,3 3,2 258 165 2018 2019 2020 2021* 2022 2023 R&D expenditure, MEUR % of net sales * Figure in the comparison period 2021 has been restated to reflect a change in the definition of research and development exp
Slide 60: Industry's most comprehensive offering for decarbonisation
Industry’s most comprehensive offering for decarbonisation 2023 2024 2025 Diesel Industry’s fastest and broadest future fuel roadmap FAME/HVO1) Market leaders in 4-stroke medium-speed main LNG engines Bio-methane Market leaders in hybrids with 26% market share2) Synthetic methane Pioneer with the wo
Slide 62: Double-digit comparable operating margin and strong order intake
Double-digit comparable operating margin and continued strong order intake ▪ Order intake increased by 11% ▪ Supported by good development in Marine order intake (+23%) ▪ Order book all-time high (7,294 MEUR) ▪ Comparable operating result increased by 50% ▪ Double-digit comparable operating margin ▪
Slide 63: Good development in key figures
Good development in key figures MEUR 1-3/2024 1-3/2023 CHANGE Order intake 1,924 1,739 11% of which services 949 889 7% of which equipment 975 850 15% Order book 7,294 6,153 19% of which current year deliveries 3,864 3,325 Net sales 1,321 1,465 -10% of which services 833 736 13% of which equipment 4
Slide 64: Marine: market sentiment turns more positive
Marine: market sentiment turns more positive for Wärtsilä’s key segments In the first quarter, appetite for new ships increased ▪ The number of vessels ordered in the review period increased to Total and specialised vessel contracting 411 (255 in the corresponding period in 2023, excluding late Numb
Slide 65: Energy: solid mid to long-term market opportunities
Energy: solid mid to long-term market opportunities In the first quarter, uncertain market environment continued despite some relief ▪ The increasing share of renewables is the primary driver Development on installed wind and solar capacity behind Wärtsilä’s balancing and energy storage solutions' d
Slide 66: Organic order intake increased by 17%
Organic order intake increased by 17% Equipment Services Order intake growth MEUR MEUR, 12m rolling MEUR MEUR, 12m rolling 11% 1 600 4 000 1 600 4 000 Equipment order 1 400 3 500 1 400 3 500 intake increased by 1 200 3 000 1 200 3 000 15% 975 949 1 000 850 2 500 1 000 889 2 500 Service order intake
Slide 67: Organic net sales decreased by 6%
Organic net sales decreased by 6% Equipment Services MEUR MEUR, 12m rolling MEUR MEUR, 12m rolling Net sales decreased 1 100 3 500 1 100 3 500 by 10% 1 000 1 000 3 000 3 000 900 900 833 Equipment net sales 800 800 729 2 500 736 2 500 decreased by 33% 700 700 631 600 2 000 2 000 600 489 600 Service n
Slide 68: Profitability continued to improve
Profitability continued to improve Net sales Comparable operating result MEUR MEUR, 12m rolling MEUR %, 12m rolling Net sales decreased 2 000 7 000 200 12,0% by 10% 1 800 180 6 000 1 600 1 465 160 10,0% Comparable operating 1 400 1 231 1 321 5 000 140 132 8,0% result increased by 1 200 4 000 120 50%
Slide 69: Marine: Good performance continued
Marine: Good performance continued Order intake, net sales and comparable operating result increased Order intake +23% Comparable operating result Comparable operating result 12m rolling MEUR MEUR 3,433 MEUR MEUR 12m rolling 11.6% 1 000 916 4 000 120 14,0% 744 800 3 000 600 + Good 12,0% 2 000 100 40
Slide 70: Energy: Comparable operating result increased
Energy: Comparable operating result increased Equipment net sales decreased due to the periodisation of deliveries between quarters Order intake Comparable operating result Comparable operating result 4% 12m rolling MEUR MEUR 3,071 MEUR MEUR 12m 12mrolling rolling9.8% 1 000 4 000 7.3% 774 100 12,0%
Slide 71: Energy Storage & Optimization: comparable operating margin positive
Energy Storage & Optimization: Comparable operating result margin (12m rolling) positive Low net sales due to the periodisation of project deliveries Quarterly development Rolling 12 months development MEUR MEUR % of net sales 400 1 400 4 350 321 328 1 200 3 1056 1034 300 992 1022 275 271 1 000 975
Slide 72: Good development in Marine service agreements
Good development in Marine service agreements Marine net sales to agreement installations increased Net sales to agreement installations (12 month rolling)1) MEUR, 12m rolling Wärtsilä Lifecycle Agreement to support optimised low-emission operations for two P&O Ferries vessels 600 ▪ Wärtsilä has sig
Slide 73: Energy service agreements at a good level
Energy service agreements at a good level MW under agreement globally MW 20 000 30% Good agreement coverage 18 000 27% ▪ 29% of installed base under agreement 16 000 24% 14 000 21% ▪ Reduction in MWs under agreement in Q1 12 000 18% 2024 affected by periodisation of agreement renewal negotiations 10
Slide 74: Prospects
Prospects Marine ▪ Wärtsilä expects the demand environment for the next 12 months (Q2/2024-Q1/2025) to be better than that of the comparison period. Energy ▪ Wärtsilä expects the demand environment for the next 12 months (Q2/2024-Q1/2025) to be better than that of the comparison period. 74 ©
Slide 75: Order intake
Order intake First quarter development 12% (14) 48% Marine Services Order intake (43) Order intake 51% 49% by business Energy by business type (51) Equipment (49) 40% Portfolio Business (43) 75 ©
Slide 76: Net sales
Net sales First quarter development 12% (10) Marine 37% (50) Services Net sales 54% Net sales Energy Equipment by business (46) by business type 34% Portfolio Business 63% (44) (50) 76 ©
Slide 77: First quarter development by business type
First quarter development by business type Order intake Net sales 27% Spare parts Spare parts (30) 35% Field service 30% (33) Field service 38% (35) Marine Marine Service agreements Service agreements (34) EUR 708 million EUR 916 million Service projects Service projects (669) (744) Equipment Equipm
Slide 78: January–March order intake by customer segment
January–March order intake by customer segment Marine Gas carriers Cruise & ferry Offshore Navy Special vessels Merchant Other Equipment 4% (12) 17% (26) 1% (2) 5% (18) 23% (4) 40% (35) 10% (3) Services 15% (19) 23% (19) 14% (17) 10% (8) 12% (11) 24% (25) 1% (2) Total 11% (17) 21% (21) 9% (12) 8% (1
Slide 79: Orders received for Energy equipment globally
Orders received for Energy equipment globally Europe 157 (212) Americas 279 (144) Asia 19 (8) Utilities IPP’s (Independent Africa and Power Producers) Middle East 0 (48) Industrials Others Equipment order intake 1-3/2024: MEUR 455 (411) 79 ©
Slide 81: We are delivering towards our sustainability targets
We are delivering towards our sustainability targets On track for our 2030 Improving safety, wellbeing and Strengthening thought leadership decarbonisation targets employee engagement and being a responsible company ✓ To become carbon neutral in ✓ Positive trend in safety indicators ✓ Developing ind
Slide 82: Strong presence in sustainable development indices
Strong presence in sustainable development indices S&P Europe 350 ESG Index ©
Slide 83: Decarbonising our own operations: Set for 30
Decarbonising our own operations requires a wide range of actions ”SET FOR 30” OUR MAIN DECARBONISATION INITIATIVES 2021 2030 Energy efficiency measures +/€ Low emission company vehicles +/€ Heat pumps in heating +/€€ R&D and factory engine testings – reduced time +/€ Self-generation and green elect
Slide 84: Wärtsilä Set for 30 is progressing well
Wärtsilä “Set for 30” is progressing well Variety of concrete actions have been taken – some examples Environmental Green electricity Solar panel standards for purchasing fully in investment in selecting new use in Finland Bermeo Spain facilities in use Electric Vehicle Heat pumps Intelligent energy
Slide 85: Wärtsilä's ESG Agenda in brief
Wärtsilä’s ESG Agenda in brief E Ambitious decarbonisation S Good Corporate Citizen and G Effective Governance targets for 2030 Responsible model ▪ Portfolio ready for Employer ▪ Sustainability zero carbon fuels matters embedded ▪ High ethical ▪ Carbon neutrality in standards own operations ▪ Divers
Slide 86: Sustainability is integrated into our strategy and purpose
Cust om Sustainability is integrated into er & our strategy and purpose Environment Co Being a forerunner in Innovative solutions m ▪ m sustainable innovation and for a low carbon economy un High environmental ity furthermore reduce ▪ valu emissions in our customers’ performance and efficiency opera
Slide 87: Wärtsilä's focus on social responsibility
Wärtsilä’s focus on social responsibility Strong ethical culture Fair competition ▪ Clear policies and instructions Trade compliance ▪ Ethical training programmes and transparent Anti-corruption communication ▪ Effective compliance programmes Human and Labour Rights A responsible employer Equal oppo
Slide 89: Board of Management
Board of Management Håkan Agnevall, Arjen Berends, Tamara de Gruyter, Kari Hietanen, Corporate President & CEO Chief Financial President, Wärtsilä Portfolio Relations and Legal Affairs Officer Business Roger Holm, President, Anders Lindberg, President, Teija Sarajärvi, Saara Tahvanainen, Wärtsilä Ma
Slide 90: Board of Directors
Board of Directors Tom Johnstone CBE, Chair of Mika Vehviläinen, Deputy Chair of the Karen Bomba, President of Smiths Morten H. Engelstoft, CEO & EVP the Board, President and CEO Board, President & CEO of Cargotec Oyj Interconnect 2017–2020 of A.P. Møller - Mærsk A/S, APM of AB SKF 2003–2014 2013-20
Slide 91: Largest shareholders April 2024
Largest shareholders April 2024 (CMi2i quarterly update) # Name Shares Share % 1 Invaw Invest AB 104,711,363 17.70% 2 Varma Mutual Pension Insurance Company 31,768,252 5.37% 3 BlackRock Fund Advisors 18,736,242 3.17% 4 The Vanguard Group, Inc. 17,795,047 3.01% 5 Ilmarinen Mutual Pension Insurance Co
Slide 92: For more information, visit our Investors page
For more information, visit our Investors page Next upcoming IR events ▪ 8.5. Roadshow in London ▪ 13.5. Danske Bank Nordic Seminar, Paris ▪ 29.-30.5. Site visit to Sustainable Technology Hub, Vaasa ▪ 5.6. Roadshow in Stockholm ▪ 6.6. CEO strategy call Wärtsilä Investor Relations Hanna-Maria Heikkin
Slide 94: Main competitors and customer base
Main competitors Engines Other marine solutions Other energy solutions MAN Kongsberg GE Himsen Alfa Laval Siemens Rolls-Royce GE Tesla Siemens Fluence Schottel Customer base Marine businesses Energy Ship owners Utilities Ship operators Independent Power Producers Ship management (IPPs) companies Ind
Slide 95: Geographical breakdown of net sales
Wärtsilä’s position as a global company is reflected in the geographical breakdown of our net sales Geographical net sales, 2023 Europe 32% Americas 29% Asia 28% Other 10% 95 ©
Slide 96: Wärtsilä Energy Storage offering
Wärtsilä Energy Storage offering GridSolv Quantum Wärtsilä-designed and assembly subcontracted Our role in the value chain ▪ Our core offering consists of 1) battery energy storage hardware, 2) GEMS Digital Energy Platform, and 3) lifecycle services, ▪ We are an energy storage system integrator, add
Slide 97: Wärtsilä Energy Storage competitive advantages
Wärtsilä Energy Storage competitive advantages Our key differentiators ▪ Integration and scalability: Wärtsilä’s GridSolv Quantum is a fully- integrated energy storage solution. Its modular and scalable design enables ease of deployment and optimisation. It integrates storage to other energy assets
Slide 98: Wärtsilä Energy Storage's direction
Wärtsilä Energy Storage’s direction Key drivers towards higher profitability 1. Selective approach in project acceptance 2. Value differentiation 3. Volume growth supporting better cost leverage and better economics of scale in procurement and assembly 4. Continuous R&D to secure latest technology a
Slide 99: Key figures in 2023
Cg WARTSILA Key figures in 2023
Slide 100: Key figures 2023
MEUR KEY FIGURES 2023 8 000 10 % 6 000 33 % Order intake 2023 4 000 7,070 MEUR Net sales, 29 % geographical 2 000 Net sales 6,015 MEUR 0 2019 2020 2021 2022 2023 28 % Comparable operating result Net sales Order intake Europe Asia Americas Other 497 MEUR Order book 2023 8.3% of net sales MEUR % 52 %
Slide 101: Wärtsilä Marine – key figures and offering
Wärtsilä Marine – Leading the path towards decarbonisation by developing state of the art technology and enabling adoption of clean fuels Key figures in 2023 Share of total net sales in 2023 Offering ▪ Multi-fuel 4-stroke engines ▪ Propulsion systems Order intake ▪ Catalyst systems ▪ Fuel gas supply
Slide 102: Wärtsilä Energy – Towards a 100% renewable energy future
Wärtsilä Energy – Towards a 100% renewable energy future Key figures in 2023 Share of total net sales in 2023 Offering • Future-fuel enabled grid balancing power plants Order intake Energy • Hybrid solutions 43% 3,041 MEUR 57% • Energy storage and optimisation Other technology, including the GEMS Di
Slide 103: WARTSILA
re, WARTSILA

Wärtsilä — Non-Deal Roadshow (May 2024) on 6ix

Wartsila Oyj Abp — Wärtsilä — Non-Deal Roadshow (May 2024)

Slide 1: Shaping the decarbonisation of marine and energy

Slide 2: Wärtsilä – Shaping the decarbonisation of marine and energy

Slide 3: Market fundamentals

Slide 4: Our value creation potential is based on two strategic themes

Slide 5: Significant milestones reached in strategy execution

Slide 6: Transform

Slide 7: Strong market fundamentals will support profitable growth in Marine business

Slide 8: Wärtsilä is a global technology and service leader in shaping decarbonisation of marine

Slide 9: Renewables and balancing power will support profitable growth in Energy business

Slide 10: Global leader in engine power plants; Energy Storage & Optimisation profitable

Slide 11: Strategic review of Energy Storage & Optimisation

Slide 12: Perform

Slide 13: Services is ~50% of our net sales with good growth potential

Slide 14: Executing services strategy on the service value ladder

Slide 15: Benefiting from operational improvements and structural changes

Slide 16: Strong commitment and a clear path to reach our financial targets

Slide 17: Energy transition driving our >5% organic growth target

Slide 18: Services and decarbonisation key drivers towards 12% operating margin

Slide 19: Actively managing our business portfolio

Slide 20: Marine & Energy Engine Power Plants have double digit profitability

Slide 21: Profitability drivers

Slide 22: Strong balance sheet and financial position

Slide 23: The Wärtsilä Way sets the scene for profitable growth

Slide 24: Strategic priorities are the key levers to improve performance

Slide 25: Marine highlights

Slide 26: Regulatory focus has moved to mid-term measures

Slide 27: A progressive switch to sustainable fuels is under way

Slide 28: Half of shipbuilding orderbook set to run on alternative fuels

Slide 29: Sustainable fuels roadmap to 2050

Slide 30: Cost of emissions will close price gap between fuels

Slide 31: We focus on the most high-value, performance-driven segments

Slide 32: Market share stronger on alternative fuel capable engines

Slide 33: Recovery in key segments will double 4-stroke main engine market

Slide 34: Global cruise capacity forecast to grow over 10%

Slide 35: Hybrid-Electric will challenge 2-stroke for LNG carriers

Slide 36: Vessel contracting forecast

Slide 37: Services is more than 60% of Marine Power sales

Slide 38: Moving up our service value ladder

Slide 39: Installations under agreement grew by 38% since 2019

Slide 40: Installed base generates revenues over 30 years

Slide 41: Vessel utilisation rates driving service business

Slide 42: Tightening regulations will boost demand for retrofits

Slide 43: Onboard Carbon Capture and Storage

Slide 44: Strong growth opportunities in marine

Slide 45: Energy highlights

Slide 46: Significant value creation opportunity

Slide 47: Actions taken to improve new build profitability

Slide 48: Balancing solutions are key enablers for renewable transition

Slide 49: Thermal balancer market expected to grow ~20% per year

Slide 50: Engine power plants in strong position as balancing market grows

Slide 51: Case Texas shows future trends

Slide 52: Energy storage growth outlook remains strong

Slide 53: Energy Storage has grown 3X and is now profitable

Slide 54: Continued good profitability in services

Slide 55: Moving up the service value ladder in Energy

Slide 56: Future performance drivers

Slide 57: Advantages of Wärtsilä power plants over combined cycle gas turbines

Slide 58: WARTSILA

Slide 59: Continuing investing in innovation

Slide 60: Industry's most comprehensive offering for decarbonisation

Slide 61: Q1 2024 development

Slide 62: Double-digit comparable operating margin and strong order intake

Slide 63: Good development in key figures

Slide 64: Marine: market sentiment turns more positive

Slide 65: Energy: solid mid to long-term market opportunities

Slide 66: Organic order intake increased by 17%

Slide 67: Organic net sales decreased by 6%

Slide 68: Profitability continued to improve

Slide 69: Marine: Good performance continued

Slide 70: Energy: Comparable operating result increased

Slide 71: Energy Storage & Optimization: comparable operating margin positive

Slide 72: Good development in Marine service agreements

Slide 73: Energy service agreements at a good level

Slide 74: Prospects

Slide 75: Order intake

Slide 76: Net sales

Slide 77: First quarter development by business type

Slide 78: January–March order intake by customer segment

Slide 79: Orders received for Energy equipment globally