Slide 1: Midyear Results 2019
Midyear Results 2019 Greg Poux-Guillaume, CEO | Jill Lee, CFO | July 24, 2019
Slide 2: Safe Harbor Statement and IFRS 16
THE SAFE HARBOR STATEMENT UNDER THE US PRIVATE SECURITIES LITIGATION REFORM ACT 1995 This presentation may contain forward-looking statements, including but not limited to, projections of financial developments, market activities or future performance of products and solutions, containing risks and
Slide 3: Business Review, Financial Review, Outlook
Business Review Financial Review Outlook Midyear Results 2019 | July 24, 2019
Slide 4: Highlights H1
Highlights H1 19 ▪ Order intake up 8.7% (+7.5% organically) on active Water (PE) and Chemical (CT) markets ▪ Sales up 13.1% (+12.1% organically) on trading of higher backlog and healthy markets ▪ OpEBITA up 15.4% FX adjusted ▪ Profitability (opROSA) at 9.0%, up 20 bps YoY ▪ FY guidance increased for
Slide 5: Pumps Equipment
Pumps Equipment Strong order intake in Water, continued improvement in profitability Key figures Order intake by market In CHF millions H1 19 H1 18 YOY adj.1 org.2 Order intake 753 720 4.5% 5.9% 5.5% Sales 690 595 16.0% 17.8% 17.3% opEBITA 19 7.7 >100% >100% >100% opROSA 2.7% 1.3% H1 19 Highlights
Slide 6: Pumps Equipment – O&G Pumps
Pumps Equipment – O&G Pumps Arbitrating the margin up in a rebounding market Start of Orders GM% downturn Start arbitrating 140 125 122 125 16.00 Regain 120 114 14.00 competitiveness 101 102 M CHF 700 700 100 12.00 bps bps 10.00 80 8.00% 60 6.00% 40 4.00% 20 2.00% 0 0.00% Q1 Q2 Q3 Q4 Q1 Q2 2018 2019
Slide 7: Rotating Equipment Services
Rotating Equipment Services Growing in all product lines, margins holding up Key figures Order intake by product line In CHF millions H1 19 H1 18 YOY adj.1 org.2 Order intake 602 572 5.3% 7.3% 6.2% Sales 561 500 12.3% 14.9% 13.7% opEBITA 67 61 9.5% 12.6% 12.3% opROSA 12.0% 12.3% H1 19 Highlights P
Slide 8: Chemtech
Chemtech Exceptional growth driving improvement in profitability Key figures Order intake by market In CHF millions H1 19 H1 18 YOY adj.1 org.2 Order intake 350 280 25.1% 25.9% 23.3% Sales 304 268 13.5% 14.4% 13.0% opEBITA 27 22 21.2% 24.1% 24.1% opROSA 8.9% 8.3% H1 19 Highlights Separation Techno
Slide 9: Chemtech leading indicators
Chemtech leading indicators Example: value of tenders prepared Value of tenders prepared ST total value of tenders prepared TFS total value of tenders prepared Avg. 2016 Avg. 2017 Avg. 2018 Avg. H1 2019 m CHF 280 240 200 160 ST: 136 ST: 126 120 ST: 108 ST: 114 ST 80 TFS: 57 TFS: 41 TFS: 37 40 TFS: 3
Slide 10: Applicator Systems
Applicator Systems Stable order intake and higher profitability Key figures Order intake by market In CHF millions H1 19 H1 18 YOY adj.1 org.2 Order intake 228 230 -0.5% 0.1% -2.1% Sales 218 229 -4.7% -4.3% -5.9% opEBITA 47 49 -3.1% -3.2% -5.3% opROSA 21.5% 21.2% H1 19 Highlights Dental, Adhesives
Slide 11: Business Review, Financial Review, Outlook
Business Review Financial Review Outlook Midyear Results 2019 | July 24, 2019
Slide 12: Overview
Overview Growing volumes and profitability Key figures Comment Order intake gross margins In CHF millions H1 19 H1 18 YOY adj.1 org.2 stabilized despite negative Order intake 1’933 1’801 7.3% 8.7% 7.5% mix effect Order intake gross margin 33.8% 33.8% Sales increased on higher Order backlog (June
Slide 13: Quarterly order development
Quarterly order development Q2 2019 orders up 7.8%1 YOY and 6.6% organically2 (in CHF millions ) Quarterly order intake Comment +6.6% org Q2 organic order intake driven by 984 949 Chemtech (+32%) and RES (+6%); 900 901 874 837 856 PE was flat (+1%) and APS was 758 790 771 slightly negative (–2%)
Slide 14: OpEBITA / opROSA
OpEBITA / opROSA Strong volume and mix effects (in CHF millions ) opROSA Market impact SFP 8.8% 9.0% 9.1% 0.1pp 0.1pp -3 8.4% -29 55 159 162 1 3 140 11 -16 Margin decline PE Power, APS Beauty Volume increase across all divisions but APS H1 18 Volume Margin Mix Other SFP Acquisitions H1 19 IFRS 16 H1
Slide 15: opEBITA to EBIT
opEBITA to EBIT EBIT impacted mainly by APS related one-off costs (in CHF millions ) 159 9.0% -31 -16 -1 -15 96 5.4% Bamberg closing -14 SFP related -8 Factory consolidation -6 opEBITA Amortization Restructuring Impairment Other non- EBIT H1 19 of assets operational H1 19 items 15 Midyear Results 20
Slide 16: EBIT to net income
EBIT to net income Effective tax rate 22.8% in H1 19 versus 22.9% in H1 2018 (in CHF millions ) 96 -10 -1 -20 65 64 -1 Effective tax rate 22.8% EBIT Financial result Income from Taxes Reported Minorities Reported H1 19 associates net income net income H1 19 shareholders H1 19 16 Midyear Results 2019
Slide 17: Balance Sheet
Balance Sheet Solid balance sheet continues to support bolt-on acquisitions (in CHF millions ) 1095 185 939 226 Balance sheet June 2019: 359 910 712 Total net debt of: CHF 378m FCF of CHF –28m Ordinary dividend payment of CHF 78m (dividend to Renova held back, CHF 42m Payable) Acquisition pa
Slide 18: Business Review, Financial Review, Outlook
Business Review Financial Review Outlook Midyear Results 2019 | July 24, 2019
Slide 19: Updated financial guidance 2019
Updated financial guidance 2019 as of July 24 up 6% – 9% Order Intake1 of which 2% from acquisitions (previously: up 2% – 5% mostly organic) up 7% – 9% Sales1 of which 2% from acquisitions (previously: up 3% – 5% mostly organic) Operational ROSA2 % around 10% (unchanged) 1. Adjusted for currency eff
Slide 20: Summary
Summary Sulzer markets remain healthy 40% Aftermarket 14% APS 2018 Power and Beauty in transition 12% Water incl. Aftermarket orders 35% Other Equipment Industry shows signs of softening growth Oil & Gas rebound continuing, some pricing uplift ~2/3 low cyclicality Water, Aftermarket activi