Metso Corporation · OMXHEX:METSO
Metso — Metso Outotec — Investor Presentation (March 2022)
71 slides from Metso's investor presentation, Mar 29, 2022
Slide 1: Investor presentation March 2022
Investor presentation March 2022
Slide 2: Forward looking statements
Forward looking statements It should be noted that certain statements herein which are not historical facts, including, without limitation, those regarding expectations for general economic development and the market situation, expectations for customer industry profitability and investment willingn
Slide 3: Metso Outotec in brief
Metso Outotec in brief • Metso Outotec is a frontrunner in sustainable technologies, end-to- end solutions and services for the aggregates, minerals processing, metals refining and recycling 4.2 50+ industries globally. billion euro countries with • By improving our customers’ sales in 2021 presence
Slide 4: Our business areas
Our business areas Aggregates Minerals Metals Services Consumables Crushing and Equipment and Processing Spare parts, Comprehensive screening full plant solutions and refurbishments offering of wear equipment for solutions for equipment for and parts for mining the production minerals metals refinin
Slide 5: We will deliver shareholder value through various means
We will deliver shareholder value through various means Growth Delivery of synergies Reducing volatility Improving profitability Offering competitive Strengthening of dividend balance sheet
Slide 6: Our investment highlights
Our investment highlights Comprehensive Strong Aftermarket Industry leader in Industry leader offering Presence & technology and Capability R&D We have created a stronger platform in an industry that is transforming through consolidation, digitalization and an increased focus on sustainability Attra
Slide 7: Metso Outotec key financials in 2021
Metso Outotec key financials in 2021 Sales EUR million Sales by segment Sales by geography 4,236 12% 15% Services 28% share of sales 28% 49% 16% 20% 60% Adjusted EBITA 21% EUR million / % 547 / 12.9% Europe North and Central America Aggregates Asia Pacific Minerals South America Metals Africa, Middl
Slide 8: Our purpose – Enabling sustainable modern life
Our purpose – Enabling sustainable modern life MEGATRENDS VISION TOP PRIORITIES Urbanization To be customers’ number one choice for sustainable use of Financial performance Electrification Earth’s natural resources. Together we deliver service, Customer success Sustainability reliability, innovation
Slide 9: Strategy implementation continues through four top priorities
Strategy implementation continues through four top priorities Financial Customer Sustainability Performance performance success culture November 4, 2021
Slide 10: Target to be industry leading company with strong financial performance
Target to be industry leading company with strong financial performance Adjusted EBITA Maintaining margin of investment >15% grade credit over the cycle rating Dividend payout of Progress in sustainability at least in alignment with the 50% 1.5°C of earnings per share commitment
Slide 11: Our key strengths provide a strong base…
Our key strengths provide a strong base… Widest offering Leading services Customer base Strong technology Scale & financial and capabilities expertise and strong brand and R&D power position
Slide 12: ...which is supported by focused organization with clear roles and responsibilities
...which is supported by focused organization with clear roles and responsibilities Business areas Market • P&L responsibility • Offering • Go-to-market models • R&D 5 areas • Customer service • Sales & account management 8 • Local operations • Scale benefits Global functions • Best practices • Glob
Slide 13: Our strong portfolio with aftermarket opportunities
Our strong portfolio with aftermarket opportunities Aggregates Minerals processing Metals 28% of sales 60% of sales 12% of sales Global #1 Global #1 Global #1 Aftermarket potential Aftermarket potential Aftermarket potential ~35-45% ~60-70% ~30-40%
Slide 14: Emphasizing services and product development
Emphasizing services and product development CONTINUOUSLY FOCUS ON PRODUCT GROW SERVICES DEVELOPMENT • Reinforce presence in Insert Background Picture • Building on our end-to- service-intensive For best end result, process use knowledge businesses an image that is 16:9 • Standardized and pre- • Pro
Slide 15: Metso Outotec growth areas
Metso Outotec growth areas Products with Sustainable Automation & China & high aftermarket offering digitalization Silk Road intensity
Slide 16: Integration synergy targets achieved ahead of plan
Integration synergy targets achieved ahead of plan July End 2019 2021 Targets exceeded, integration Original synergy targets period has ended Cost synergies by end 2022 Cost synergies EUR 100 million EUR 142 million Revenue synergies by end 2022 Revenue synergies EUR 150 million EUR 110 million in s
Slide 17: Business specific profitability improvement actions continue
Business specific profitability improvement actions continue Earlier initiated actions continue uninterrupted in Minerals and Aggregates, Metals restructuring and turnaround actions ongoing Supply footprint Customer centricity R&D • Ensuring scale and competitiveness • Improving on-time delivery • E
Slide 18: Strategy execution will result in measurable financial improvement
Strategy execution will result in measurable financial improvement Building blocks of adj. EBITA % improvement Financial targets Adjusted EBITA >15% over the cycle 11.2 Maintaining an ‘investment- grade’ credit rating Dividend pay-out of at least 50% of earnings per share Progress in sustainability
Slide 19: Action taken in Metals & Recycling
Action taken in Metals & Recycling • Metals strategic review started in January 2022 • Hydrometallurgy moved to Minerals • Aluminium business divestment completed in April 2021 • Recycling business to be divested • Waste Recycling business divestment completed in Dec 2021 • Metals Recycling divestme
Slide 20: Our core industries have a solid growth outlook…
Our core industries have a solid growth outlook… AGGREGATES MINERALS PROCESSING METAL REFINING – equipment market growth – equipment market growth – equipment market growth EUR billion EUR billion EUR billion 10 4 ~6 6 ~8-10 8 ~3 5 ~7 CAGR CAGR ~2-3 CAGR 19-23F 6 19E-23F 19E-23F 4 4-6% 2 3-6% 3-6% 4
Slide 21: …and our exposure is balanced…
…and our exposure is balanced… ~80% of sales spread across 4 major applications 9% 10% 30% Copper Aggregates Iron Gold Battery metals 13% Other metals 24% 14% Excluding recycling and other industries
Slide 22: …between three major growing metals…
…between three major growing metals… MINING CAPEX PRODUCTION 2019-2023 Current market Share of M:O sales M:O addressable market, EUR billion balance COPPER (total committed) 24 21 Slight oversupply Mt +4% Deficit expected >2023 30% 2019 2023 ~8-10 ~7 CAGR IRON ORE 2.534 3-6% 2.423 Mt Slight oversupp
Slide 23: …and a good position in fast-emerging battery metal processing and recycling markets
…and a good position in fast-emerging battery metal processing and recycling markets GLOBAL LI-ION DEMAND 2019-30, Mt Current market Future market BATTERY CELL balance balance NICKEL DEMAND (battery-grade / +23% p.a. HPAL route) GWh 1.19 Slight oversupply Shortage of battery-grade is expected after
Slide 24: Our commitment to the 1.5 °C journey
Our commitment to the 1.5 °C journey Our footprint targets Our footprint results CO2 emissions CO2 emissions in our own in our own operations operations -60% Net zero in 2020 by 2030 Spend from Logistics CO2 Spend from emissions suppliers with Logistics CO2 suppliers with Science Based emissions Sci
Slide 25: Metso Outotec sustainability key facts
Metso Outotec sustainability key facts • Committed to limiting global warming to 1.5 degree with Science Based Targets • Planet Positive products: around 100 • Latest sustainability ratings ‒ CDP rating B ‒ MCSI rating AAA ‒ CDP Supplier Engagement Rating A ‒ Listed on CDP 2020 Supplier Engagement L
Slide 26: Enabling customers to reach their sustainability targets
Enabling customers to reach their sustainability targets Planet Positive product for every part of the value chain All R&D with Accelerating Partnering with Own operations Zero harm sustainability Planet Positive suppliers to CO2 emissions targets sales decarbonize the net zero by 2030 supply chain
Slide 27: Industry-leading service expertise and global network
Industry-leading service expertise and global network • Comprehensive service portfolio from spares and wears to advanced lifecycle services • World-class team of experts • Efficient service processes to enable our experts to get it right – fast • Deep understanding of customer process, product desi
Slide 28: Sustainable technologies to help customers
Sustainable technologies to help customers Examples of technologies with higher energy, water, emissions and resource efficiency Lower energy consumption with Vertimills® 25-35% in grinding Lower water consumption at copper concentrator with 65% Pretium Water Advisor & Process Water Recycling Plant
Slide 29: Strong innovation and R&D power
Strong innovation and R&D power 15+ 70 30 6,800+ million euros New Planet Investment in R&D centers, Patents Positive launches research and co-creating with in 2021 development in 2021 and customizing solutions to customers 29 April 20, 2022
Slide 30: Metso Outotec R&D and operations footprint
Metso Outotec R&D and operations footprint Country with direct presence HQ Factory Research center Test center and lab Note: Excluding service locations
Slide 31: Uncompromising safety in offering and operations
Uncompromising safety in offering and operations Safe products and services • Products designed for safety # of injuries per million hours of work • Safe and professional service teams 8 Safe and responsible 6 Total Recordable Injury supply chain Frequency (TRIF)2 • Rigorous supplier screening • Sup
Slide 32: Metso Outotec global team of professionals
Metso Outotec global team of professionals Our 15,000+ people by geography 12% 13% 35% 13% 27% Europe South America Asia-Pacific North and Central America Africa and MEI
Slide 33: Metso Outotec leadership team
Metso Outotec leadership team Extended Metso Outotec Executive Team Metso Outotec Executive Team CEO Pekka Vauramo CFO, Legal & Compliance Business development Nina Kiviranta Eeva Sipilä HR Carita Himberg Minerals Aggregates Metals Services Consumables Markku Markku Simula Piia Karhu Sami Takaluoma
Slide 34: Metso Outotec for the aggregates industry
Metso Outotec for the aggregates industry Our offering Customer benefits • Crushers, screens and feeders • Best cost, best availability, easy-to- buy, and easy-to-own solutions • Mobile and portable machines and plants • Range of brands and solutions that cover needs from essential to high- • Statio
Slide 35: Unparalleled offering for crushing and screening
Unparalleled offering for crushing and screening Lokotrack ® Cone and jaw crushers World-leading offering in Urban™ series crushing Community-friendly crushing plants with advanced noise and dust protection – incl electric and hybrid Life Cycle Services and financing services Service models that mak
Slide 36: Developing sustainable crushing solutions
Developing sustainable crushing solutions 50k+ Metso Outotec • Metso Outotec crushers are world leaders in crushers compressive crushing technology and hard delivered rock applications • They have unique combination of high crushing performance and reliability for the toughest conditions • In total,
Slide 37: Investing in growth
Investing in growth Increasing our production capacity Adding • Increasing mobile crushing and close to the another screening equipment production in customers 20,000 m2 in Alwar, Alwar, India India – Production in the new assembly line is planned to start in early 2023, making Alwar the largest Met
Slide 38: Customers benefit from a global network of over 200 distributors
Customers benefit from a global network of over 200 distributors Nordics 11 Canada Russia & CIS 8 Europe 5 China 47 36 USA New distributors 56 Middle East in 2021 Mexico & Central America 6 Asia Pacific 12 Africa 18 42 Pacific Rim 11 Australasia 15 9
Slide 39: Our product portfolio is ~50% electric today
Our product portfolio is ~50% electric today Stationary equipment Wheel mounted Track mounted Fully electric Fully electric ~15% electric Stationary equipment Wheel mounted equipment Diesel-hydraulic (traditional) 100 % electric powered. 100 % electric powered. Diesel-electric (dual-power) Annual so
Slide 40: Metso Outotec for minerals processing
Metso Outotec for minerals processing Our offering Customer benefits • Equipment for comminution, • Most technologically advanced beneficiation, dewatering, equipment and solutions with classification, material handling, and - Highest recovery rate and throughput slurry handling - Lowest total cost
Slide 41: Our full offering from ore to metal
Our full offering from ore to metal Minerals processing Metallurgy Aggregates processing Prospecting, exploration, Comminution: Comminution: Separation: Separation: From ore Metals refining To development, extraction dry wet beneficiation dewatering body metal Classification / Materials handling / S
Slide 42: Minerals: full offering from ore to concentrate
Minerals: full offering from ore to concentrate Vertimill® HIGmill® Industry benchmark in stirred Advanced and energy-efficient fine milling technology and ultra-fine grinding solution HRC™ Nordberg MP Series™ cone High pressure grinding rolls for crushers efficient size reduction in mining Maximum
Slide 43: Industry-leading end-to-end solutions for minerals processing
Industry-leading end-to-end solutions for minerals processing • Strategy supporting growth and sustainable mining • Processes, expertise, and portfolio streamlined to meet customer needs • Over 20 portfolio and product launches have taken place since the merger – and R&D focus: we have a good amount
Slide 44: Unique maintenance and optimization capabilities and process expertise
Unique maintenance and optimization capabilities and process expertise • Services business is over 50% of our sales • Service solutions improve equipment and process efficiency sustainably. Customers’ • R&D focus is in sustainable and digital solutions. expectations • Global manufacturing footprint
Slide 45: There is a step change taking place
There is a step change taking place Customers are focusing on smarter and more sustainable mining: • Water stewardship • Energy consumption • Agility through, for example, modularity • New levels of reliability November 4, 2021
Slide 46: New Planet Positive solutions for minerals processing
New Planet Positive solutions for minerals processing Energy- Energy efficient Concorde CellTM efficient Horizontal Mill for recovering fine modular In-pit Plant units for and ultra-fine crush and optimized particles with convey grinding minimized energy solutions circuit throughput and water consum
Slide 47: Planet Positive solutions for aftermarket
Planet Positive solutions for aftermarket Optimized spare and wear parts, upgrades and modernizations Truck body Optimized wear parts Repairs Lighter, more More efficient Extending payload & less processes the lifetime fuel per hauled Long lasting wears of customer ton Lower energy assets for consum
Slide 48: Supporting our customers to reach their full potential with Life Cycle Services
Supporting our customers to reach their full potential with Life Cycle Services Renewed LCS offering and packages Globally 400+ Life Cycle Services contracts • Inspections • Shutdown • Maintenance • Plant Solution Commitment • Technology specific LCS packages for on safety and sustainability Filtrat
Slide 49: Metso Outotec for metals refining
Metso Outotec for metals refining Our offering Customer benefits • Pre-engineered products and solutions • Full solutions for processing almost for process islands and full plants any ore or concentrate to refined metal, incl sulfuric acid production • Tailored EP, EPS and EPC plant deliveries • In-
Slide 50: Advanced solutions from ore or concentrate to metal
Advanced solutions from ore or concentrate to metal Iron Ore Agglomeration World-class smelting World leader with more than 400 technologies Sinter Plants and more than 100 Operated by world’s largest -incl. the world’s biggest-Pellet Plants copper, nickel and ferrochrome supplied globally operation
Slide 51: Unique global supplier
Unique global supplier • Industry-leading sustainable products and services portfolio for pyrometallurgy, sulphuric acid, and agglomeration & heat transfer • Leading solutions for decreasing customers’ CO2 emissions, e.g. – Copper Flash Smelting – Alumina calcination – FeCr smelting • Currently stro
Slide 52: Examples of major metals processing orders published since the merger
Examples of major metals processing 1 orders published since the merger EUR 23 million Siderite calcination plant 1 EUR 150 million Zinc plant expansion 1 EUR 90 million Nickel smelter modernization 1 2 6 1 Precious Alumina Iron ore EUR 360 million metals processing pelletizing Copper smelter to rec
Slide 53: Sustainable technologies in R&D focus
Sustainable technologies in R&D focus Modular plants & digital solutions 15 New sustainable Carbon-free technologies in Circular economy Battery metals Gold production 2021-2028 Introduction of New solutions for Technology Compact, relocatable hydrogen and bio- impurity management capabilities to pr
Slide 54: Q4/2021 and full-year results
Q4/2021 and full-year results
Slide 55: Q4 in short
Q4 in short • Strong market activity in all segments • Services orders continued to increase • Strong sales growth and profitability improvement • Adverse impact from supply chain and logistics • Integration completed successfully and targets achieved February 10, 2022
Slide 56: Group Q4 key figures
Group Q4 key figures EUR million Q4/2021 Q4/2020 Change % Orders received 1,310 1,304 0 Sales 1,278 977 31 Adjusted EBITA 164 103 58 % of sales 12.8 10.6 — Operating profit 130 44 195 % of sales 10.2 4.5 — EPS, continuing operations, EUR (IFRS) 0.11 0.03 267 Cash flow from operations (IFRS) 164 177
Slide 57: Group full-year key figures
Group full-year key figures IFRS, except for 1-6/2020 illustrative combined EUR million 2021 2020 Change % Orders received 5,421 4,150 31 Sales 4,236 3,897 9 Adjusted EBITA 547 448 22 % of sales 12.9 11.5 — Operating profit 425 253 68 % of sales 10.0 6.5 — EPS, continuing operations EUR (IFRS) 0.35
Slide 58: Aggregates segment quarterly highlights
Aggregates segment quarterly highlights • Orders received EUR 331 million (EUR 363 EUR million % million) ◦ Strong market activity ◦ Tight component availability limiting order confirmations ◦ Services orders +18% y-o-y • Sales EUR 324 million (EUR 251 million) ◦ Equipment grew faster than services
Slide 59: Minerals segment quarterly highlights
Minerals segment quarterly highlights • Orders EUR 760 million (EUR 730 million) EUR million % ◦ Strong market activity ◦ Planet Positive offering and productivity solutions in high demand ◦ Services orders +22% • Sales EUR 779 million (EUR 640 million) ◦ Increased equipment sales from the backlog ◦
Slide 60: Metals segment quarterly highlights
Metals segment quarterly highlights % • Orders received EUR 219 million (EUR 212 EUR million million) ◦ Strong market activity ◦ One large order of more than EUR 100 million • Sales EUR 174 million (EUR 86 million) ◦ Deliveries from the backlog increased ◦ Services share 15% (19%) • Adjusted EBITA E
Slide 61: IFRS Income Statement
IFRS Income Statement EUR million Q4/2021 Q4/2020 2021 2020* Sales 1,278 977 4,236 3,897 Adj. EBITA 164 103 547 448 Adj. EBITA, % 12.8 10.6 12.9 11.5 Operating profit 130 44 425 253 Operating profit, % 10.2 4.5 10.0 6.5 Net financial expenses -14 -19 -39 -44 Profit before taxes 116 26 385 209 Income
Slide 62: IFRS Balance Sheet
IFRS Balance Sheet Restated EUR million December 31, 2021 December 31, 2020 Net debt halved since merger EUR million Intangible assets 2,002 2,060 Total property, plant and equipment 373 356 Right-of-use assets 127 132 Other non-current assets 234 215 Inventories 1,269 1,038 Receivables (trade and o
Slide 63: Cash Flow
Cash Flow Cash flow from operations EUR million Q4/2021 Q1-Q4/2021 Q1-Q4/2020 EUR million Profit for the period, continuing operations 94 294 149 Profit for the period, discontinued operations 26 48 -11 Adjustments: 77 297 256 Depreciation and amortization 42 167 160 Financial expenses, net 14 39 38
Slide 64: Net working capital on December 31, 2021
Net working capital on December 31, 2021 EUR million February 10, 2022
Slide 65: Solid financial position
Solid financial position • Early repayments totaling EUR 350 million to bank loans during 2021 EUR million December 31, 2021 December 31, 2020 • We cancelled two bilateral credit facilities Liquid funds 473 537 totaling EUR 90 million in 2021 Net debt 470 799 • Sustainability targets included in the
Slide 66: Integration synergy targets achieved ahead of plan
Integration synergy targets achieved ahead of plan • Annual run-rate of EUR 142 million reached in cost synergies (target EUR 120 million) • The majority of realized synergies comes from the restructuring of the organization and the rest from facilities, IT, and procurement • Realized revenue synerg
Slide 67: Structural developments
Structural developments • Waste Recycling divestment completed in December • Metal Recycling agreed to be divested, closing in H1/22 • Hydrometallurgy moved from Metals to Minerals ◦ Opportunities and synergies in minerals processing ◦ Integrated Planet Positive offering • Remaining Metals businesse
Slide 68: Sustainability highlights 2021
Sustainability highlights 2021 Corporate Knights 2022 • Several Planet Positive launches and orders with Global100 index of the world’s significant Planet Positive content most sustainable companies • Planet Positive portfolio currently covering capital equipment and consumables offering CDP ranking
Slide 69: COVID-19 impacts in Q4
COVID-19 impacts in Q4 • Local and regional restrictions and lockdowns continue limiting access to customer sites and in certain countries also own premises • Slowing down decision-making and overall cooperation with customers • Omicron has been a challenge especially to the manufacturing and wareho
Slide 70: Market Outlook
Market Outlook Metso Outotec expects the market activity to remain at the current strong level, subject to the development of the Covid-19 pandemic. According to its disclosure policy, Metso Outotec’s market outlook describes the expected sequential development of market activity during the followin
Slide 71: mogroup.com
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