Slide 1: Wärtsilä Corporation Result Presentation 2018
WÄRTSILÄ CORPORATION RESULT PRESENTATION 2018 30 January 2019 Jaakko Eskola, President & CEO 1 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation 2018
Slide 2: Growth in order intake and net sales
GROWTH IN ORDER INTAKE AND NET SALES 2 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation 2018
Slide 3: Key financials 2018
Key financials 2018 • Order intake EUR 6,307 million, +12% • Order book at the end of the period EUR 6,166 million, +21% • Net sales EUR 5,174 million, +5% • Book-to-bill 1.22 (1.15) • Comparable operating result EUR 577 million (576), which represents 11.2% of net sales (11.7) • Earnings per share
Slide 4: Positive development in order intake
Positive development in order intake MEUR 6 500 6 000 Fourth quarter development 5 500 MEUR 5 000 2 000 1,874 4 500 1 800 4 000 1,514 1 600 24% 3 500 1 400 3 000 Services 1 200 24% 2 500 1 000 Marine 2 000 Solutions 800 33% 1 500 600 Energy 1 000 400 18% Solutions 500 200 0 0 2014 2015 2016 2017 201
Slide 5: Net sales supported by increased newbuild deliveries
Net sales supported by increased newbuild deliveries MEUR 5 500 5 000 Fourth quarter development 4 500 MEUR 4 000 1 800 1,532 3 500 1 600 1,441 3 000 1 400 6% 2 500 1 200 4% Services 1 000 2 000 Marine 800 19% Solutions 1 500 600 1 000 Energy 400 1% Solutions 500 200 0 0 2014 2015 2016 2017 2018 Q4/
Slide 6: Net sales by business 2018
Net sales by business 2018 Marine Solutions 24% (22) Services 47% (49) Energy Solutions 29% (29) Comparison figures for 2017 have been restated due to the internal reorganisation of service activities and the adoption of IFRS 15. 6 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation 2018
Slide 7: Book-to-bill
Book-to-bill MEUR 7 000 1,6 6 500 6 000 5 500 1.22 1.15 1,2 5 000 1.06 1.03 4 500 0.98 4 000 3 500 0,8 3 000 2 500 2 000 0,4 1 500 1 000 500 0 0,0 2014 2015 2016 2017 2018 Order intake Net sales Book-to-bill Comparison figures for 2017 have been restated due to the adoption of IFRS 15. 7 © Wärtsilä
Slide 8: Order book distribution
Order book distribution MEUR 5 000 4 500 4 000 3 500 3 000 2 500 2 000 1 500 1 000 500 0 31.12.2017 31.12.2018 Delivery next year Delivery after next year Comparison figures for 2017 have been restated due to the adoption of IFRS 15. 8 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation
Slide 9: Profitability affected by group sales mix
Profitability affected by group sales mix MEUR 700 14% 12.2% 12.1% 11.9% 11.7% 11.2% 600 12% 500 10% 400 8% 300 6% 200 4% 100 2% 0 0% 2014 2015 2016 2017 2018 Comparable operating result % of net sales Comparison figures for 2017 have been restated due to the adoption of IFRS 15. 9 © Wärtsilä PUBLIC
Slide 10: Services
SERVICES 10 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation 2018
Slide 11: Solid development in Services' net sales
SERVICES Solid development in Services’ net sales MEUR 2 600 2 400 Fourth quarter development 2 200 2 000 MEUR 1 800 900 1 600 800 737 710 4% 1 400 700 1 200 600 1 000 500 800 400 600 300 400 200 200 100 0 0 2014 2015 2016 2017 2018 Q4/2017 Q4/2018 Q1-Q3 Q4 Comparison figures for 2017 have been rest
Slide 12: Net sales distribution 2018
SERVICES Net sales distribution 2018 By product area By segment Special vessels Others 8% (8) 2% (2) Oil & Gas Field service 4% (4) 23% (24) Offshore Power plants 4% (5) 35% (37) Spare parts Navy 47% (48) 7% (8) Agreements 20% (17) Merchant 23% (22) Cruise & ferry Projects 17% (15) 10% (12) Total EU
Slide 13: Installed base covered by service agreements
SERVICES Installed base covered by service agreements 25 000 30% 25% 20 000 20% 15 000 MW 15% 10 000 10% 5 000 5% 0 0% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 MW under agreement – Energy Solutions MW under agreement – Marine Solutions % of Energy Solutions’ installed base % of Marine Solut
Slide 14: Wärtsilä to operate and maintain a 130 MW power plant in Mexico
Setti 1 Setti 1 Wärtsilä to operate and maintain a 130 MW power plant in Mexico • The power plant operates on seven Wärtsilä 50SG gas-fuelled engines. • Plant predictability and reliability is ensured through the efficiency and flexibility of Wärtsilä’s engines, backed by operations, maintenance, an
Slide 15: Energy Solutions
ENERGY SOLUTIONS 15 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation 2018
Slide 16: Quotation activity by fuel type
ENERGY SOLUTIONS Quotation activity by fuel type MW 60 000 50 000 40 000 Multi-fuel 30 000 Gas Liquid fuel 20 000 10 000 0 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Q1/2016 Q2/2016 Q3/2016 Q4/2016 Q1/2017 Q2/2017 Q3/2017 Q4/2017 Q1/2018 Q2/2018 Q3/2018 Q4/2018 Calculated on a 12 months rolling basis 16 © Wärt
Slide 17: Energy Solutions' order intake affected by slower customer decision-making
ENERGY SOLUTIONS Energy Solutions’ order intake affected by slower customer decision-making Review period development MEUR Total EUR 1,511 million (1,685) 1 800 4% 1 600 Utilities 1 400 48% 48% Independent power producers 1 200 Industrials 1 000 800 Review period order intake 600 by fuel in MW 400 O
Slide 18: Ordering activity highest in Asia
ENERGY SOLUTIONS Ordering activity highest in Asia Asia 1,426 (2,380) Europe 327 (198) 36 106 221 519 871 Americas 818 (796) 10 392 417 Africa and Middle East 289 (402) Utilities IPP’s 88 70 (Independent Power Producers) Industrials 132 Order intake 2018: 2,905 MW (3,775) 18 © Wärtsilä PUBLIC 30 Jan
Slide 19: Wärtsilä to supply electricity and district heating for Dresden, Germany
Setti 1 Setti 1 Wärtsilä to supply electricity and district heating for Dresden, Germany • The 90 MW combined heat and power plant features eight highly efficient and flexible Wärtsilä 31SG engines operating on natural gas. • The plant will be delivered by Wärtsilä on an EPC basis to DREWAG, Dresden
Slide 20: Market for gas and liquid fuel power plants, <500 MW
ENERGY SOLUTIONS Market for gas and liquid fuel power plants, <500 MW Other GT’s Ansaldo 1% (2) 8% (7) Wärtsilä 13% (17) MHI 33% (22) Siemens 22% (28) GE 23% (24) <500 MW market volume: 20.8 GW (20.7) Total market volume: 40.7 GW (44.2) Market shares are calculated on a 12 months rolling basis, numb
Slide 21: Marine Solutions
MARINE SOLUTIONS 21 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation 2018
Slide 22: Gradual recovery in vessel contracting
MARINE SOLUTIONS Gradual recovery in vessel contracting Merchant Offshore Cruise and Ferry Special vessels 3 months moving average in CGT * 250 5,0 4,5 200 4,0 3,5 * Number of vessels 150 3,0 Million CGT 2,5 100 2,0 1,5 50 1,0 0,5 0 0,0 1/2009 4/2009 7/2009 1/2010 4/2010 7/2010 1/2011 4/2011 7/2011
Slide 23: Marine Solutions' order intake boosted by scrubbers and favourable contracting mix
MARINE SOLUTIONS Marine Solutions’ order intake boosted by scrubbers and favourable contracting mix MEUR 1 800 Review period development Total EUR 1,710 million (1,288) 1 500 Offshore Gas carriers 7% (3) 1 200 14% (26) Special vessels 8% (7) 900 Traditional 600 merchant Cruise 28% (22) 25% (26) 300
Slide 24: Marine Solutions' order book 31 December 2018
MARINE SOLUTIONS Marine Solutions’ order book 31 December 2018 Bulk carriers 5% Offshore Containers 3% 6% Cargo 1% RoRo 2% Tankers 11% Cruise 32% Gas carriers 14% Non-vessel 2% Special vessels Ferry 7% Navy 5% 13% 24 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation 2018
Slide 25: Financials
FINANCIALS 25 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation 2018
Slide 26: Cash flow from operating activities
FINANCIALS Cash flow from operating activities MEUR 700 600 500 400 300 200 100 0 2014 2015 2016 2017 2018 26 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation 2018
Slide 27: Working capital
FINANCIALS Working capital MEUR 1 600 25% 1 400 20% 1 200 1 000 15% 800 11.5% 11.2% 10.8% 10.2% 563 581 10% 600 543 490 400 5.2% 251 5% 200 0 0% 2014 2015 2016 2017 2018 Working capital Total inventories Advances received Working capital / Net sales Comparison figures for 2017 have been restated due
Slide 28: Gearing
FINANCIALS Gearing 0,50 0,40 0,30 0,20 0,10 0,00 2014 2015 2016 2017 2018 28 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation 2018
Slide 29: EPS and dividend per share
FINANCIALS EPS and dividend per share EUR 1,0 0,9 0,8 0,7 0.65 0,6 0.48 0,5 0,4 0,3 0,2 0,1 0,0 2014 2015 2016 2017 2018* EPS Dividend * Dividend 2018 - Proposal of the Board Figures have been restated to reflect the new amount of shares. 29 © Wärtsilä PUBLIC 30 January 2019 Full year result present
Slide 30: Wärtsilä to enhance competitiveness by aligning operations globally
Setti 1 Setti 1 Wärtsilä to enhance competitiveness aby aligning operations globally • The Group-wide programme emphasises sustainable savings and actions that increase customer value, including: • Increased focus on targeted sales activities • Developing the agreements-based and “as-a-service” busi
Slide 31: Prospects for 2019
Setti 1 Setti 1 Prospects for 2019 The demand for Wärtsilä’s services and solutions in 2019 is expected to be in line with the previous year. Demand by business area is anticipated to be as follows: • Solid in Energy Business • Solid in Marine Business 31 © Wärtsilä PUBLIC 30 January 2019 Full year
Slide 32: Thank you
THANK YOU Further information: Natalia Valtasaari Director, Investor Relations Tel. +358 (0) 10 709 5637 E-mail: natalia.valtasaari@wartsila.com 32 © Wärtsilä PUBLIC 30 January 2019 Full year result presentation 2018