Wartsila Oyj Abp · OMXHEX:WRT1V

Wartsila Oyj Abp — Q2 2021 Earnings Presentation

34 slides from Wartsila Oyj Abp's earnings presentation, Jul 20, 2021

  1. Slide 1: Half Year Report January–June 2021

    WÄRTSILÄ CORPORATION HALF YEAR REPORT JANUARY – JUNE 2021 20 JULY 2021 HÅKAN AGNEVALL, PRESIDENT & CEO ARJEN BERENDS, CFO 1 © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

  2. Slide 2: Strong cash flow, but business still hampered by COVID-19

    STRONG CASH FLOW, BUT BUSINESS STILL HAMPERED BY COVID-19 • Order intake increased by 14%, growth in all businesses • Good progress in services: ̶ Order intake increased by 24% ̶ Net sales increased by 16% • Profitability improved despite lower net sales • Strong cash flow from operating activities

  3. Slide 3: Good development in key figures

    GOOD DEVELOPMENT IN KEY FIGURES MEUR 4–6/2021 4–6/2020 CHANGE 1–6/2021 1–6/2020 CHANGE Order intake 1,154 1,011 14% 2,398 2,259 6% of which services 604 486 24% 1,308 1,120 17% Order book 5,238 5,401 -3% of which current year deliveries 2,225 2,165 3% Net sales 1,131 1,220 -7% 2,078 2,390 -13% of wh

  4. Slide 4: Second quarter highlights

    SECOND QUARTER HIGHLIGHTS Net sales Comparable operating result MEUR MEUR, 12m rolling MEUR %, 12m rolling Net sales EUR 1,131 million 1,800 6,000 250 14.0% • -7% due to lower 1,600 equipment deliveries 5,000 11.1% 12.0% 1,400 200 • Service net sales 1,217 1,220 10.0% 1,200 1,131 4,000 increased by

  5. Slide 5: Marine market recovering

    MARINE MARKET RECOVERING UNEVEN PROGRESS ACROSS SEGMENTS – VESSEL CONTRACTING IN CRUISE AND FERRY MARKETS LOW Total vessel contracting Number of vessels • The number of vessels ordered in the review 1,200 1,000 period increased to 829 (312 in the 800 corresponding period in 2020, excluding late 600

  6. Slide 6: Recovery expected to take time in the energy market

    RECOVERY EXPECTED TO TAKE TIME IN THE ENERGY MARKET GOOD ACTIVITY IN THE ENERGY STORAGE MARKET Market for gas and liquid fuel power plants <500 MW • The COVID-19 pandemic and the resulting MW, 12m rolling weakening of the investment environment 20,000 continued to negatively impact the energy market

  7. Slide 7: Order intake increased by 14%

    ORDER INTAKE INCREASED BY 14% Equipment Services MEUR MEUR, 12m rolling MEUR MEUR, 12m rolling 1,000 3,500 1,000 3,500 • Order intake 900 900 increased across 800 754 3,000 800 3,000 businesses 700 2,500 700 623 2,500 604 600 549 600 • Equipment order 526 2,000 486 2,000 500 500 intake increased 1,5

  8. Slide 8: Slight decrease in order book due to divestments

    SLIGHT DECREASE IN ORDER BOOK DUE TO DIVESTMENTS BOOK-TO-BILL IMPROVING Order book by business Order book delivery schedule MEUR MEUR 7,000 1.40 3,000 6,000 1.20 2,500 5,000 1.00 2,000 4,000 0.80 1,500 3,000 0.60 1,000 2,000 0.40 1,000 0.20 500 0 0.00 0 30.6.2019* 31.12.2019 30.6.2020 31.12.2020 30.

  9. Slide 9: Net sales decreased by 7%

    NET SALES DECREASED BY 7% Equipment Services MEUR MEUR, 12m rolling MEUR MEUR, 12m rolling • Equipment net 1,000 3,000 1,000 3,000 sales decreased by 900 900 24%, mainly due to 2,500 2,500 800 800 fewer scrubber 710 700 700 deliveries and 604 2,000 613 591 2,000 600 600 delays in energy 540 510 500

  10. Slide 10: Technology and partnership highlights

    TECHNOLOGY AND PARTNERSHIP HIGHLIGHTS ENABLING INDUSTRY DECARBONISATION Testing hydrogen and ammonia • An engine and plant concept for pure hydrogen ready by 2025 • An engine concept with pure ammonia ready in 2023 Autonomous, zero-emission barge with Port of Rotterdam • Collaborating to demonstrate

  11. Slide 11: © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

    11 © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

  12. Slide 12: Marine Power: increase in all key figures

    MARINE POWER: INCREASE IN ALL KEY FIGURES SERVICE ORDERS INCREASED BY 30% Order intake Comparable operating result Comparable operating result 12m rolling +18% MEUR MEUR 1,759 MEUR MEUR 12m rolling 9.1% 700 632 2,500 120 16.0% 600 500 463 2,000 110 391 400 1,500 14.0% 300 100 1,000 200 90 12.0% 500

  13. Slide 13: Marine Power service agreements

    MARINE POWER SERVICE AGREEMENTS NET SALES FROM INSTALLATIONS UNDER AGREEMENT STABILISED AFTER A COVID-19 RELATED DECLINE MEUR, 12m rolling 400 Second renewal of optimised maintenance agreement with Rederi Ab Eckerö 350 • This latest 5-year agreement covers the main 300 and auxiliary engines in six v

  14. Slide 14: © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

    14 © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

  15. Slide 15: Marine Systems: strong order intake

    MARINE SYSTEMS: STRONG ORDER INTAKE SERVICE ORDER INTAKE INCREASED BY 34% Order intake Comparable operating result Comparable operating result 12m rolling +54% MEUR MEUR 643 MEUR MEUR 12m rolling 9.3% 300 1,200 60 12.0% 250 1,000 198 183 800 200 150 119 600 50 10.0% 100 400 50 200 0 0 40 8.0% Q219 Q

  16. Slide 16: © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

    16 © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

  17. Slide 17: Voyage: higher net sales

    VOYAGE: HIGHER NET SALES SERVICE ORDER INTAKE INCREASED BY 61% Order intake Comparable operating result Comparable operating result 12m rolling +9% MEUR MEUR 245 MEUR MEUR 12m rolling -16.4% 120 400 Q220 Q221 0 0.0% 100 72 300 80 60 56 60 200 -5.0% 40 -10 100 -9 20 -11 -12 -11 -12 0 0 -10.0% Q219 Q4

  18. Slide 18: Vessels connected to our cloud solutions increased by 78%

    VESSELS CONNECTED TO OUR CLOUD SOLUTIONS INCREASED BY 78% Number of connected vessels +78% Wärtsilä and Tanger Med enabled the first real-life digital port call • The containership ‘Kobe Express’ docked safely and on time at Tanger Med port in Morocco using the Wärtsilä Navi-Port system • Navi-Port

  19. Slide 19: © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

    19 © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

  20. Slide 20: Energy: order intake and profitability improved

    ENERGY: ORDER INTAKE AND PROFITABILITY IMPROVED SERVICE ORDERS INCREASED BY 22% Order intake Comparable operating result Comparable operating result 12m rolling +11% MEUR MEUR 1,715 MEUR MEUR 12m rolling 6.5% 700 2,000 120 10.0% 600 500 435 433 1,500 110 390 400 9.0% 1,000 100 300 200 500 90 8.0% 10

  21. Slide 21: Flexible thermal balancing power gaining traction

    Flexible thermal balancing power gaining traction • Wärtsilä received an order to supply equipment for a 156 MW multi-fuel balancing power plant to Omaha Public Power District in Nebraska, the United States. Wärtsilä’s technology will be used to balance renewable power generation in the grid and ens

  22. Slide 22: Energy service agreements

    ENERGY SERVICE AGREEMENTS INSTALLED BASE COVERED BY LONG-TERM SERVICE AGREEMENTS HAS BEEN STABLE DURING 2021 MW 16,000 30% A long-term optimised maintenance agreement signed for power plants in three 14,000 25% locations in Nigeria 12,000 20% • The plants covered by the five-year agreement 10,000 pr

  23. Slide 23: Other key financials

    WARTSILA OTHER KEY, ~ FINANCIALS S.

  24. Slide 24: Other key financials – net debt decreased

    OTHER KEY FINANCIALS – NET DEBT DECREASED MEUR 4–6/2021 4-6/2020 1–6/2021 1–6/2020 Cash flow from operating activities 245 252 312 293 Working capital 73 492 Net interest-bearing debt 253 643 Gearing 0.12 0.31 Solvency, % 37.8 35.0 Basic earnings/share, EUR 0.06 0.04 0.10 0.09 24 © Wärtsilä 20 July

  25. Slide 25: Strong cash flow from operating activities

    STRONG CASH FLOW FROM OPERATING ACTIVITIES RECORD HIGH CASH FLOW IN THE FIRST HALF OF THE YEAR Cash flow from operating activities Second quarter development MEUR MEUR, 12m rolling MEUR 350 800 300 700 252 245 250 600 200 500 150 400 100 300 50 200 0 -50 100 -37 -100 0 Q219 Q319 Q419 Q120 Q220 Q320

  26. Slide 26: Outlook: demand environment in third quarter expected better

    Wärtsilä expects the demand environment in the third quarter to be better than that of the corresponding period in the previous year. However, the prevailing market conditions make the outlook uncertain. © Wärtsilä

  27. Slide 27: Save the date: Wärtsilä Capital Markets Day 18 November 2021

    SAVE THE DATE: WÄRTSILÄ CAPITAL MARKETS DAY 18 NOVEMBER 2021 27 © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

  28. Slide 28: © Wärtsilä

    Cc WARTSILA

  29. Slide 29: Order intake: second quarter development

    ORDER INTAKE SECOND QUARTER DEVELOPMENT 1% (5) 40% (39) Marine Power 38% (39) Marine Systems Services Order intake Order intake Voyage 48% Equipment by business by business type (52) 52% Energy (48) Portfolio Business 5% (5) 16% (12) 29 © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

  30. Slide 30: Net sales: second quarter development

    NET SALES SECOND QUARTER DEVELOPMENT 3% (4) 41% (34) Marine Power 37% (37) Marine Systems Services Net sales Net sales Voyage 48% Equipment by business by business type 52% Energy (58) (42) Portfolio Business 6% 13% (20) (5) 30 © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

  31. Slide 31: Second quarter development by business type

    SECOND QUARTER DEVELOPMENT BY BUSINESS TYPE Order intake Net sales 26% (28) 26% (23) Spare parts Spare parts Marine Field service Marine Field service 45% Businesses 45% Businesses Service agreements Service agreements EUR 684 million (48) EUR 706 million (56) (715) Service projects (566) Service pr

  32. Slide 32: January–June order intake by customer segment

    JANUARY–JUNE ORDER INTAKE BY CUSTOMER SEGMENT Special Marine Businesses Gas carriers Cruise & ferry Offshore Navy vessels Merchant Other Marine Power Equipment 7% (6) 38% (32) 6% (7) 15% (11) 22% (24) 11% (19) 0% (0) Services 20% (16) 19% (13) 14% (16) 7% (12) 14% (15) 25% (25) 1% (3) Marine Systems

  33. Slide 33: Orders received for energy equipment globally

    ORDERS RECEIVED FOR ENERGY EQUIPMENT GLOBALLY Europe 46 (11) Asia 42 (65) Americas Utilities 332 (380) IPP’s Africa and (Independent Middle East Power Producers) 40 (29) Industrials Others ORDER INTAKE 1-6/2021: MEUR 461 (486) 33 © Wärtsilä 20 July 2021 HALF YEAR REPORT JANUARY-JUNE 2021

  34. Slide 34: Wärtsilä

    re, WARTSILA

Wartsila Oyj Abp — Q2 2021 Earnings Presentation on 6ix