Alfa Laval Ab · OMXSTO:ALFA
Alfa Laval Ab — Q2 2016 Earnings Presentation
34 slides from Alfa Laval Ab's earnings presentation, 2016
Slide 1: NOE
NOE
Slide 2: Report for Q2 2016
Report for Q2 2016 - Key figures - Orders received and margins - Development per segment - Geographical development - Financials Mr. Tom Erixon - Outlook President and CEO Alfa Laval Group
Slide 3: Key figures
Key figures April – June 2016 Orders received declined 11% to SEK 8,101 million. Net sales dropped 12% to SEK 8,950 million. Adjusted EBITA declined 23% to SEK 1,393 million. Adjusted EBITA margin at 15.6% vs 17.8% - Positive currency effect SEK 137 million. January – June 2016 Orders rece
Slide 4: Key figures
Key figures April - June versus January – March Order intake grew 5% and reached SEK 8,101 million. Net sales increased 9% to SEK 8,950 million. Adjusted EBITA grew 4.5% to SEK 1,393 million. Adjusted EBITA margin at 15.6% vs 16.3% © Alfa Laval Slide 4 www.alfalaval.com
Slide 5: Orders received
Orders received SEK million SEK million R 12 12 000 45000 40000 10 000 35000 8 000 30000 25000 6 000 20000 +18% 4 000 15000 +3% +1% -7% -9% 10000 2 000 5000 0 0 Q212 Q312 Q412 Q213 Q313 Q413 Q214 Q314 Q414 Q215 Q315 Q216 Q415 Q113 Q114 Q115 Q116 = Order intake per quarter “large” = Rolling twelve mo
Slide 6: Order analysis
Order analysis Q2 2016 versus Q2 2015 and versus Q1 2016 (MSEK) Q2 2015 9,146 Q1 2016 7,710 Structural change, % + 0.3 - Organic development, % - 9.2 + 4.9 Total - 8.9 + 4.9 Currency effects,% - 2.5 + 0.2 Total, % - 11.4 + 5.1 Q2 2016 8,101 Q2 2016 8,101 © Alfa Laval Slide 6 www.alfalaval.com
Slide 7: Adjusted EBITA / margin
Adjusted EBITA / margin* SEK millions and in percent of sales 2 000 24,0 1 750 21,0 1 500 18,0 1 250 15,0 1 000 12,0 750 9,0 500 6,0 250 3,0 0 0,0 Q213 Q313 Q413 Q114 Q214 Q314 Q414 Q115 Q215 Q315 Q415 Q116 Q216 * Adjusted EBITA – ”Earnings before interests, taxes, amortization of goodwill and step
Slide 8: Equipment division
Equipment division Highlights and sequential comments Industrial Industrial Equipment boosted by seasonality. Equipment 10%* Demand for products for refrigeration and the manufacturing industry grew. - + Sanitary did well, driven by demand from Sanitary 13% customers in dairy, prepared food and
Slide 9: Marine & Diesel division
Marine & Diesel division Highlights and sequential comments Marine & Diesel M&D Equipment down on lower ship contracting. Equipment Diesel demand grew, as did demand for ballast 5%* water treatment systems. - - Marine & Offshore Systems also affected by lower Marine & ship contracting. Decline p
Slide 10: Process Technology division
Process Technology division Highlights and sequential comments In Energy & Process, the business exposed to the Energy & Process 11%* hydrocarbon chain showed an overall decline, compensated for by growth in Inorganics, Metals and Paper. - = In Food & LS, Brewery and Vegetable oil grew on Food &
Slide 11: Orders received by customer segment
Orders received by customer segment January – June 2016, at constant rates and like for like PTD Service + - Industrial Equipment + Sanitary Equipment Water & Waste = Food & Life Science = - OEM = EQD Service Energy & Process - - Marine & Diesel Eq. MDD Service = - Marine & Offshore Syst. Marine & O
Slide 12: Orders received by Region
Orders received by Region April – June 2016, development at constant rates Latin America 5% -26 +24 North America 21% +19 +20 -3 +9 -2 +10 -19 -5 Asia 34% Western Europe 22% +24 -13 Central & Eastern Europe 7% Nordic 9% Year-on-year comparison Sequential comparison © Alfa Laval www.alfalaval.com
Slide 13: Report for Q2 2016
Report for Q2 2016 - Key figures - Orders received and margins - Development per segment - Geographical development - Financials Mr. Thomas Thuresson - Outlook CFO Alfa Laval Group
Slide 14: Highlights
Highlights SEK millions April – June 2016 Order intake 8,101 Net sales 8,950 © Alfa Laval Slide 14 www.alfalaval.com
Slide 15: Gross profit margin
Gross profit margin In percent of sales 45 40 37.9 36.3 36.3 36.2 35 30 Q213 Q313 Q413 Q114 Q214 Q314 Q414 Q115 Q215 Q315 Q415 Q116 Q216 © Alfa Laval www.alfalaval.com
Slide 16: Gross profit margin
Gross profit margin Q2 2016 versus Q2 2015 and versus Q1 2016 Q2 2015 36.3 Q1 2016 37.0 Mix/price -- -- Load/volume -- -- FX +++ ++ Structure = = Q2 2016 36.2 Q2 2016 36.2 © Alfa Laval Slide 16 www.alfalaval.com
Slide 17: Highlights
Highlights SEK millions April – June, 2016 Order intake 8,101 Net sales 8,950 Adjusted EBITA 1,393 Adjusted EBITA-margin 15.6% Profit before tax 1,265 Earnings per share 2.21 Earnings per share, excl step-up 2.66 ROCE 19.9% ROE 20.2% © Alfa Laval Slide 17 www.alfalaval.com
Slide 18: Divisional performance
Divisional performance Equipment Process Technology Marine & Diesel Q2 2016 2015 2016 2015 2016 2015 Orders 2,758 2,850 2,972 3,165 2,371 3,131 Backlog 1,767 1,957 6,851 8,543 9,981 12,774 Sales 2,529 2,680 3,285 3,822 3,136 3,675 Op. profit 346 347 333 497 592 798 Op margin (%) 13.7 12.9 10.1 13.0
Slide 19: Cash-flow statement
Cash-flow statement Q2 Q2 1H 1H SEK millions 2016 2015 2016 2015 Cash flow from - operating activities 1,233 1,505 2,143 2,606 - investing activities - 128 - 135 - 227 - 215 Financial net paid 21 - 82 - 2 - 208 Total 1,126 1,288 1,914 2,183 Pro Forma Free cash-flow* 1,157 1,288 1,951 2,183 *Incl. op
Slide 20: Foreign exchange
Foreign exchange Estimated impact on adjusted EBITA from FX fluctuations SEK million Q2 16 1H 16 FY 16 FY 17* Translation effect -50 -87 -100 0 Transaction effect 187 317 575 100 Total 137 230 475 100 *Based on EUR/USD 1.1070 and EUR/SEK 9.3500 Projected FX-effect for 2016 as communicated in Q1 repo
Slide 21: Order backlog as per June 30
Order backlog as per June 30 SEK millions 25 000 23,274 10,240 18,599 20 000 7,810 15 000 10 000 13,034 10,789 5 000 book to bill 0 Q212 Q213 Q214 Q215 Q216 For delivery after 2016 For delivery in 2016 © Alfa Laval Slide 21 www.alfalaval.com
Slide 22: Sales
Sales Full year 2016 SEK (bln) YTD 2016 17.1 Backlog, current year + 10.8 Orders “in-for-out” last year H2 + 7.4 Subtotal 35.3 Change in “in-for-out” +/- ? Price ? Full year 2016 www.alfalaval.com
Slide 23: Report for Q2 2016
Report for Q2 2016 - Key figures - Orders received and margins - Development per segment - Geographical development - Financials Mr. Tom Erixon - Outlook President and CEO Alfa Laval Group
Slide 24: Outlook for the third quarter
Outlook for the third quarter “We expect that demand during the third quarter will be in line with or somewhat lower than in the second quarter.” © Alfa Laval Slide 24 www.alfalaval.com
Slide 25: www.alfalaval.com
© Alfa Laval Slide 25 www.alfalaval.com
Slide 26: Activity split O&G, total
Activity split O&G, total - Distribution of orders Q2 (MSEK) vs Q1 2016 Drilling Processing & Refinery Petrochemicals Transportation Grand total Process 8 214 226 294 742 (-12%) Technology Marine & 0 0 Diesel 76 47 123 (-23%) Alfa Laval = 84 = 261 = 226 = 294 = 865* (-14%) Share of total Alfa Laval
Slide 27: Marine & Diesel industry split
Marine & Diesel industry split - Distribution of sales LTM, June 2016 Marine Offshore oil Environment & Diesel power Parts & Service and gas Energy, Marine World trade & Oil & gas demand Legislation and Electrical power World trade Driver fleet capacity and prices fuel cost needs 29% 48% Share 3% 10
Slide 28: Marine & Diesel industry split
Marine & Diesel industry split - Distribution of orders LTM, June 2016 Marine Offshore oil Environment & Diesel power Parts & Service and gas Energy, Marine World trade & Oil & gas demand Legislation and Electrical power World trade Driver fleet capacity and prices fuel cost needs 34% 46% Share 4% 1
Slide 29: Highlights Asia
Highlights Asia April – June 2016, at constant rates, sequential comments Asia: Lower demand from marine shipbuilding and for the Process Technology business explains the decline. -19 -5 PTD affected by the non-repeat of larger orders in Food Technology, while Equipment had a good quarter, espec
Slide 30: Highlights Europe
Highlights Europe April – June 2016, at constant rates, sequential comments -26 +24 +19 +20 -3 +9 Western Europe incl. Nordic: Central and Eastern Europe: Positive development for base business Region’s positive development reflected and larger projects alike. Most countries growth in most count
Slide 31: Highlights Americas
Highlights Americas April – June 2016, at constant rates, sequential comments North America: Growth driven by larger projects. The base business was unchanged. Several segments reported growth, especially Sanitary and Water & Waste. Service was -2 +10 unchanged. Latin America: Negative develop
Slide 32: Orders received by Region
Orders received by Region January – June 2016, development at constant rates Latin America 5% -31 North America 20% +16 -6 -13 -22 Asia 36% Western Europe 22% +13 Central & Eastern Nordic 8% Europe 7% Year-on-year comparison © Alfa Laval www.alfalaval.com
Slide 33: Top markets
Top 10 markets* SEK million at prevailing rates United States China South Korea Nordic Japan SEA Mid Europé Adriatic Benelux India 0 1 000 2 000 3 000 4 000 5 000 6 000 = LTM Q2 2016 *The development of the 2015 top ten markets. = WY 2015 © Alfa Laval Slide 33 www.alfalaval.com
Slide 34: Cautionary statement
Cautionary statement This presentation contains forward-looking statements that are based on the current expectations of the management of Alfa Laval Group. Although management believes that the expectations reflected in such forward- looking statements are based on reasonable assumptions, no assura