Wartsila Oyj Abp · OMXHEX:WRT1V
Wartsila Oyj Abp — Wärtsilä — Investor Presentation (2006)
42 slides from Wartsila Oyj Abp's investor presentation, Jul 5, 2006
Slide 1: Wärtsilä Corporation Corporate Presentation 2006
Wärtsilä Corporation Corporate Presentation 2006 © Wärtsilä
Slide 2: Wärtsilä in brief
Wärtsilä in brief Wärtsilä focuses on the ship power and energy markets with products and solutions as well as services. Lifetime support of installations through design, solutions, service, spare parts and operational support. Listed on the Helsinki Exchanges, headquarters in Helsinki, Finland. The
Slide 3: Mission and vision
Mission and vision Mission We provide lifecycle power solutions to enhance the business of our customers, whilst creating better technologies that benefit both the customer and the environment. Vision We will be the most valued business partner of all our customers. © Wärtsilä 3
Slide 4: Strategy
Strategy Ship Power solutions Power Plant solutions Growth through new Stronger position in products and increasing decentralized presence in Asia energy © Wärtsilä 4
Slide 5: Offering: We are in business to power your business
Offering We are in business to power your business Ship OEM services Power services Plants Engines Propulsors Ship Power systems O&M Competitors’ engines © Wärtsilä 5
Slide 6: Offering: seeking growth beyond organic growth
Offering …and we are seeking growth beyond the organic growth Non-engine related services Ship OEM services Power services Plants Additional Engines products Propulsors Ship Power systems O&M Competitors’ engines Additional engine brands © Wärtsilä 6
Slide 7: Values
Values Energy Capture opportunities and make things happen Excellence Do things better than anyone else in our industry Excitement Foster openness, respect and trust to create excitement © Wärtsilä 7
Slide 8: History
History 1834 Wärtsilä is established in the 1984 Wärtsilä quoted on the London municipality of Tohmajärvi, Finland. stock exchange. 1898 The sawmill and iron works 1988 A company is set up in India and company is renamed Wärtsilä Ab. floated on the Bombay stock 1936 Wärtsilä acquires the Onkilahti e
Slide 9: History
History 1991 Imatra Steel is created when Ovako 2001 Wärtsilä sells its holding in Sanitec. AB is split up between its owners, Wärtsilä takes ownership of service Metra and SKF. company Ciserv AB and Sermet Oy. 1995 Wärtsilä Diesel and Cummins 2002 The Ciserv-group expands. Wärtsilä Engine Company I
Slide 10: Group key figures 2005
Group key figures 2005 Net sales by business 2005 2005 2004 Power Imatra MEUR Businesses Steel Group Group Power Plants Services 28% (29) 43%(32) Net sales 2,520.3 119.1 2,638.8 2,478.2 EBITA 202.5 21.8 224.3 112.0 % of net sales 8.0% 18.3% 8.5% 4.5% Profit before taxes 212.4 217.3 EPS (EUR) 1.80 1.
Slide 11: Wärtsilä's worldwide network
Wärtsilä’s worldwide network Wärtsilä is close to its customers through subsidiaries in roughly 60 countries. © Wärtsilä 11
Slide 12: Personnel
Personnel Personnel by market area Personnel by business Other countries Power Plants Corporation 2.6% 6.3% 2.4% Americas 10.2% Engine Division 14.9% Asia 25.5% Ship Power 16.4% Europe Services 61.7% 60.0% © Wärtsilä 12
Slide 13: Personnel in figures
Personnel in figures Total 12,008 at 31.12.2005 8000 7000 6000 5000 4000 3000 2000 1000 0 Services Ship Power Engine Power Corporation Division Plants Total wage and salary costs in 2005 EUR 540.0 million © Wärtsilä 13
Slide 14: R & D - Technology leadership
R & D - Technology leadership Wärtsilä’s target is technology leadership in reliability, operating economy, automation and environmental technologies. For customers this means fewer upgrades, better control over business and investments, and lower risks. R&D focus areas; Continuous development of ne
Slide 15: Wärtsilä sustainability
Wärtsilä sustainability Wärtsilä’s stakeholders Values: Continuous improvement and reporting Principles: Financial Environmental Social Operating Energy responsibility responsibility responsibility principles • Profitable, competitive • Sustainable use of • Responsible corporate and efficient busine
Slide 16: Wärtsilä Ship Power
Wärtsilä Ship Power Wärtsilä provides ship machinery, propulsion and maneuvering solutions for builders, owners and operators of all types of marine vessels and offshore applications. Wärtsilä contributes to optimizing the customers business by providing solutions over the lifecycle of the installat
Slide 17: Ship Power in short
Ship Power in short Markets in 2005 MEUR 2005 2004 Change The good demand in the Net sales 710.3 631.2 12.5% shipbuilding industry continued Order intake 1,545.3 836.7 84.7% High activity level in offshore, pass- Order book* 1,658.5 812.7 104.1% enger and RoPax vessels and LNG Trend from large to sm
Slide 18: Ship Power in short
Ship Power in short Ship Power net sales Ship Power net sales per segment Tankers 13% Cruise & Ferry 24% Bulk carriers 4% Container 28% ships General 17% cargo 10% LNG 3% Special vessels & other 14% Offshore 15% of Power Businesses net sales © Wärtsilä 18
Slide 19: Business strategy
Business strategy Maintain leading position and grow further by: Broadening the product offering through organic growth, partnerships and acquisitions. Focus on product technology leadership and a broad service offering. Increase capabilities in automation, electronics and ship design. Strengthen pr
Slide 20: Product Solutions: strategic steps
Strategic steps Most valued Product Solutions Engine business partner Strategic steps to expand room the market offering and create customer value: Integration of sub-systems e alu and components into larger v Propulsion er power solutions. packages om st Value-in-use service Cu solutions that reduc
Slide 21: Market offering
Market offering Product areas • 2-stroke • 4-stroke • Propulsion • Solutions Related services • Design • Engineering • Project management • Commissioning • Lifetime support © Wärtsilä 21
Slide 22: Market drivers
Market drivers The world economy, trade and needed transport capacity drive shipping and shipbuilding demand. Wärtsilä market driver is the global demand for new vessels which are based on seaborne transportation, offshore oil exploration and support, cruise and ferry demand as well as naval contrac
Slide 23: Customer groups
Customer groups Ship owners and operators Shipbuilders Lowest operating costs over the Build vessels that meet the owners’ lifetime of the vessel. requirements at the lowest cost. Reliability Price Availability On-time delivery Life-cycle costs Engineering 2nd hand value Project management Relations
Slide 24: Market segments
Market segments Seaborne Offshore oil exploration Cruise Naval and Special transportation and support and ferry governmental vessels © Wärtsilä 24
Slide 25: Wärtsilä Services
Wärtsilä Services Services continuously develop innovative products and services for all our markets and all Wärtsilä engine types and power systems. We also provide services for other makes of equipment on board vessels as well as comprehensive ship service in key ports. Our Services deliver effici
Slide 26: Services in short
Services in short Services net sales MEUR 2005 2004 Change Net sales 1,093.1 936.8 16.7% Personnel* 7,200 6,378 12.9% Our wide range of Services provides innovative solutions that optimize the lifecycle efficiency of installed equipment. 43% Installed base of 150 GW Services business net sales 1,093
Slide 27: Business strategy
Business strategy Maintain leading position and grow further by: Developing the customer base, the service scope, and through strategic acquisitions. Dual approach where the service business expands within the installed engine base as well as moving into new markets outside the traditional marine/po
Slide 28: Product Solutions: strategic steps
Strategic steps Most valued Product Solutions Strategic steps to expand business partner the market offering and create customer value: Broadening scope of e alu support and services v worldwide. er om State-of-the-art service st Cu products and tailored solutions. Continuous development Services of
Slide 29: Market offering
Market offering Service categories Spare parts O&M support Field service Technical support Performance optimizers Environmental solutions CBM Training Online services © Wärtsilä 29
Slide 30: Market drivers
Market drivers Lifecycle efficiency focusing on availability, reliability and economy of equipment and installations. Environment, operational and equipment performance. Operations and management outsourcing. © Wärtsilä 30
Slide 31: Customer groups
Customer groups Total Service Service market is primarily for all Ship Power and Power Wärtsilä’s installed (OEM) engine Plants segments and customers base © Wärtsilä 31
Slide 32: Wärtsilä Power Plants
Wärtsilä Power Plants Wärtsilä is a leading supplier of power plants for the decentralized power generation market. Wärtsilä offers power plant solutions based on oil, gas and dual-fuel engines, as well as biomass-fuelled heat and power plants. At the end of 2005 Wärtsilä had delivered a total of 34
Slide 33: Power Plants in short
Power Plants in short Power Plants net sales MEUR 2005 2004 Change Net sales 710.3 651.9 9.0% Order intake 865.2 1,019.5 -15.1% Order book* 943.9 752.4 25.5% Markets in 2005 Power plant markets active globally 28% Global gas power plant market grew Wärtsilä’s technology in the gas market being recog
Slide 34: Business strategy
Business strategy Maintain leading position in the heavy fuel oil market segment by active market monitoring through the global network Look for growth in: the gas power plant segment in developing countries Wärtsilä’s well known home markets gas infrastructure grows rapidly the western world peakin
Slide 35: Product Solutions: strategic steps
Strategic steps Most valued Product Solutions Strategic steps to expand the business partner market offering and create customer value: Serving markets with new as well as conversions of existing e alu oil power plants into gas power v er plants. om st Focusing on the biopower Cu sector in Europe, w
Slide 36: Market offering
Market offering Product areas Oil power plants Gas power plants Combined heat & power plants Oil & gas applications Biopower (bio-oil & biomass) Related services Spare parts Maintenance Remote condition monitoring Long-term operation of power plants © Wärtsilä 36
Slide 37: Market drivers
Market drivers Strong growth in world economy boosts need for electricity. Oil price rises and tightening environmental norms favor high-efficiency products. Electricity consumption growth rates fairly high in developing world – demand steady in HFO market largely dominated by Wärtsilä. Oil and gas
Slide 38: Customer groups
Customer groups Energy Production Industrial Manufacturing (Electricity & Heat) (Cement, Paper, etc.) IPP/Utility/Municipality Industry Core business Non-core business Profitability Savings ROI Profitability Availability Reliability Support Peace of Mind Performance - Long-term Response time Industr
Slide 39: Market segments
Market segments Oil power plants Gas power plants Combined heat Oil & Gas Biopower Heavy fuel oil fired Power plants & power plants applications Main fuel is wet base load power fired by gas 1…100 MW Solutions for field northern wood plants 4…150 MW (CHP) plants power generation based solid 1…300 MW
Slide 40: Wärtsilä's holdings
Wärtsilä’s holdings The new company started its operations on the 10th of May 2005. Wärtsilä’s ownership in the company is 26.5%. The holding was accounted for as an associated company from 1st of May 2005. Wärtsilä’s share of the associated company’s result was EUR 10.4 million (5-12/2005). The hol
Slide 41: Outlook for the year 2006
Outlook for the year 2006 Demand in the ship power and energy markets looks likely to remain favourable for Wärtsilä for at least the first half of the current year. Based on the strong order book, Wärtsilä’s net sales are expected to grow this year by as much as 20%. The profitability level reached
Slide 42: Thank you!
Thank you! © Wärtsilä 42