24 slides from Siemens Aktiengesellschaft's investor day presentation, Jun 29, 2010
Slide 1: Siemens Energy: Power Distribution Division
Siemens Energy: Power Distribution Division En Me erg diu y Au Sm mV to art olt T& m ati Gri age DS on d& erv e-c ice ar s inf r as tru ctu re Ralf Christian CEO Power Distribution Nuremberg, June 29, 2010 Capital Market Day Energy © Siemens AG 2010. All rights reserved.
Slide 2: Safe Harbour Statement
Safe Harbour Statement This document contains forward-looking statements and information – that is, statements related to future, not past, events. These statements may be identified by words such as "expects," "looks forward to", "anticipates", "intends", "plans", "believes", "seeks", "estimates",
Slide 3: Power Distribution is a core element in the energy conversion chain
Power Distribution is a core element in the energy conversion chain En Me erg diu y Au Sm mV to art olt T& m ati Gri age DS on d& erv e-c ice ar s inf r as tru ctu re Medium Energy T&D Voltage Automation Services Page 3 June 29, 2010 Capital Market Day Energy © Siemens AG 2010. All rights reserved.
Slide 4: Worldwide leadership in utility business and outstanding position in Europe
Worldwide leadership in utility business and outstanding position in Europe Medium Voltage Energy Automation T&D Services Gas insulated switchgear Protection relays Asset services Air insulated switchgear Substation automation Metering services Power distribution solutions Power cont
Slide 5: Strong and unmatched global setup
Strong and unmatched global setup Outstanding global and market positions Balanced global footprint >50% employees in emerging countries 14,500 employees 19 production locations in 13 countries 17 service centers Global reach: Dedicated setup in 76 countries for engineering, project executio
Slide 6: Delivered solid performance in tough conditions
Delivered solid performance in tough conditions €bn +8% -16% +7% New orders 3.3 3.6 3.0 0.7 0.8 €bn +13% +2% -4% Revenue 2.9 3.2 3.3 0.7 0.7 % 15,0% 13.3% 13.9% Profit 11.5% (in % of revenue 9.8% 435 435 96 100 and € million) 279 369 369 279 (9.8%) (11.5%) (13.3%) % ROCE 58% 65% 65% 68% 58% 65% 65%
Slide 7: Dramatic improvement in key operating areas
Dramatic improvement in key operating areas SG&A cost Operating net working capital Supply chain management -18% -21% +80% 48.4% FY 08 FY 09 FY 08 FY 09 FY 08 FY 09 Procurement pooling Our success factors Executed HQ-lead projects in all clusters to streamline administrative functions Significan
Slide 8: Adopted distinct strategies to win in developed and emerging markets
Adopted distinct strategies to win in developed and emerging markets € 30bn total market in 2011 Key growth drivers Key to success BRA +25% Emerging markets CHN +11% Fast growing mega cities Local engineering 50% Building-up the electrical grid 50% IND +7% Local order fulfillment Developin
Slide 9: Sector-leading emerging market presence
Sector-leading emerging market presence Developing global value add Emerging market products Purchase volume Medium Voltage Switchgear 30% 38% 38% from emerging Hybrid Indoor SIMOSEC markets Outdoor circuit breakers FY 08 FY 10E 22 Protection & Control Global product 17 Protection relay lines
Slide 10: Chinese market strengths accelerating quickly
Chinese market strengths accelerating quickly Expanding R&D and product life cycle Ramping up of R&D and manufacturing management Medium Voltage, Wuxi Energy Automation, Nanjing Revenue +48% Revenue +16% R&D headcount +60% R&D budget +60% 5 new products lines for gas insulated 3 product
Slide 11: Strong pipeline of innovation
Strong pipeline of innovation R&D – investment world 1st world #1 world #1 + 30% Power converter MV switchgear for Virtual power plants links for ships off-shore wind FY 08 FY 10E 1,300 R&D headcount 16 R&D locations world #1 world #1 world 1st 15 major R&D projects >2,500 patents granted
Slide 12: Service offerings expanded and gaining traction
Service offerings expanded and gaining traction Solid base business Key to success: Expanded offerings Ageing Innovative portfolio Remote diagnostics and infrastructure technology-based, high device monitoring beyond life-cycle competency services Grid simulation tools and Ageing utility
Slide 13: Unique leadership position in power generation and transmission grid intelligence
Unique leadership position in power generation and transmission grid intelligence Today #1 in Smart Transmission Bulk power Transmission grid Distribution grid Power generation consumption >> €1bn/a Integrated communication infrastructure Uni-directional power flow Page 13 June 29, 2010 Capital Mark
Slide 14: Traditional electricity flows are rapidly being altered
''Traditional'' electricity flows are rapidly being altered Large-scale renewables: Load Wind power plants Wind Solar power plants Power Bulk power Transmission grid Distribution grid Power generation consumption >> €1bn/a Integrated communication infrastructure Uni-directional power flow Enhanc
Slide 15: Leadership position extended into distribution grid
Leadership position extended into distribution grid Large-scale renewables: Load Wind power plants Wind Power Solar power plants new Bulk power Transmission grid Distribution grid Power generation consumption >> €1bn/a Integrated communication infrastructure Uni-directional power flow Enhancing
Slide 16: Intelligent applications needed to balance generation and consumption trends
Intelligent applications needed to balance generation and consumption trends Large-scale renewables: Decentralized generation: Load Wind power plants Wind Thousands of small renewable Solar power plants Power E-cars and storage new new Bulk power Transmission grid Distribution grid Power gen
Slide 17: Innovative Grid Intelligence and new Smart Grid Applications drive sustainable top-line growth
Innovative Grid Intelligence and new Smart Grid Applications drive sustainable top-line growth 2010 - 2014 market view Controls for Integration of Supergrid Power Flow Control HVDC & FACTS Medium Size Bulk Renewables Energy & Congestion Protection Feeder Smart Buildings Management Automation Integra
Slide 18: Accelerating deployment of customer-specific Smart Grid solutions
Accelerating deployment of customer-specific Smart Grid solutions Energy & congestion Substation automation Integrated distribution management for distribution network Market redesign and Distribution supervisory & Integrated system for technology upgrade control system distribution network au
Slide 19: Driving top-line growth and profitability
Driving top-line growth and profitability Continually improving operational excellence Rapid increase in emerging market profile Strong investment in R&D Strong top-line growth paced by growing infrastructure expansion & upgrade, Smart Grid investment and e-car infrastructure Delivering consistent p
Slide 20: Reconciliation and Definitions for Non-GAAP Measures (I)
Reconciliation and Definitions for Non-GAAP Measures (I) To supplement Siemens’ Consolidated Financial Statements presented in accordance with International Financial Reporting Standards, or IFRS, Siemens presents the following supplemental financial measures: New orders and order backlog Adjust
Slide 21: Reconciliation and Definitions for Non-GAAP Measures (II)
Reconciliation and Definitions for Non-GAAP Measures (II) New orders and order backlog (continued) New orders are generally recognized immediately when the relevant contract becomes legally effective and binding. The only exception are orders with short overall contract terms. In this case, a separa
Slide 22: Reconciliation and Definitions for Non-GAAP Measures (III)
Reconciliation and Definitions for Non-GAAP Measures (III) Return on equity, or ROE In line with common practice in the financial services industry, Siemens Financial Services (SFS) uses return on equity, or ROE, as one of its key profitability measures. Siemens defines ROE as annualized Income befo
Slide 23: Reconciliation and Definitions for Non-GAAP Measures (IV)
Reconciliation and Definitions for Non-GAAP Measures (IV) EBITDA (adjusted) and EBIT (adjusted) Siemens defines EBITDA (adjusted) as EBIT (adjusted) before amortization (which in turn is defined as Amortization and impairments of intangible assets other than goodwill) and Depreciation and impairment
Slide 24: Reconciliation and Definitions for Non-GAAP Measures (V)
Reconciliation and Definitions for Non-GAAP Measures (V) Limitations Associated with Siemens’ Supplemental Financial Measures The supplemental financial measures reported by Siemens may be subject to limitations as analytical tools. In particular: With respect to adjusted or organic growth rates o