Slide 1: Wärtsilä Corporation Half Year Financial Report January-June 2017
WÄRTSILÄ CORPORATION HALF YEAR FINANCIAL REPORT JANUARY-JUNE 2017 20 July 2017 Jaakko Eskola, President & CEO 1 © Wärtsilä PUBLI C 20 July 2017 Half year financial report 2017
Slide 2: Highlights Q2/2017
Highlights Q2/2017 • Order intake EUR 1,363 million, +14% • Net sales EUR 1,292 million, +8% • Book-to-bill 1.05 (1.00) • Comparable operating result EUR 126 million (122), which represents 9.7% of net sales (10.2) • Earnings per share EUR 0.38 (0.19) • Cash flow from operating activities EUR 2 mill
Slide 3: Order intake developed well in all business areas
Order intake developed well in all business areas MEUR 5 500 5 000 Second quarter development 4 500 MEUR 4 000 1 600 1,363 3 500 1 400 1,194 14% 3 000 1 200 14% Services 2 500 1 000 2 000 800 Marine 11% Solutions 1 500 600 1 000 400 Energy 19% Solutions 500 200 0 0 2013 2014 2015 2016 2017 Q2/2016 Q
Slide 4: Net sales supported by higher power plant deliveries
Net sales supported by higher power plant deliveries MEUR 5 500 5 000 Second quarter development 4 500 MEUR 4 000 1 600 3 500 1,292 1 400 1,196 8% 3 000 1 200 1% Services 2 500 1 000 2 000 800 Marine -23% Solutions 1 500 600 1 000 400 Energy 87% Solutions 500 200 0 0 2013 2014 2015 2016 2017 Q2/2016
Slide 5: Net sales by business 1-6/2017
Net sales by business 1-6/2017 Services Marine Solutions 45% (48) 27% (36) Energy Solutions 28% (16) 5 © Wärtsilä PUBLI C 20 July 2017 Half year financial report 2017
Slide 6: Book-to-bill
Book-to-bill MEUR 5 500 1,4 1.21 5 000 1,2 4 500 1.03 1.05 1.06 4 000 0.98 1,0 3 500 0,8 3 000 2 500 0,6 2 000 1 500 0,4 1 000 0,2 500 0 0,0 2013 2014 2015 2016 1-6/2017 Order intake Net sales Book-to-bill 6 © Wärtsilä PUBLI C 20 July 2017 Half year financial report 2017
Slide 7: Order book distribution
Order book distribution MEUR 3 500 3 000 2 500 2 000 1 500 1 000 500 0 30.6.2016 30.6.2017 Delivery current year Delivery next year or later 7 © Wärtsilä PUBLI C 20 July 2017 Half year financial report 2017
Slide 8: Operating result
Operating result MEUR 700 14% 12.2% 11.9% 12.1% Review period development 600 12% 11.2% MEUR 240 14% 500 10% 200 12% 400 8% 9.5% 9.2% 10% 160 300 6% 8% 120 6% 200 4% 80 4% 100 2% 40 2% 0 0% 0 0% 2013 2014 2015 2016 1-6/2016 1-6/2017 Comparable operating result % of net sales Items affecting comparab
Slide 9: Services
SERVICES 9 © Wärtsilä PUBLI C 20 July 2017 Half year financial report 2017
Slide 10: Stable development in Services' net sales
SERVICES Stable development in Services’ net sales MEUR 2 400 2 200 Second quarter development 2 000 MEUR 1 800 700 1 600 1 400 600 542 546 1 200 1% 500 1 000 400 800 300 600 200 400 200 100 0 0 2013 2014 2015 2016 2017 Q2/2016 Q2/2017 Q1-Q2 Q3-Q4 10 © Wärtsilä PUBLI C 20 July 2017 Half year financi
Slide 11: Net sales distribution 1-6/2017
SERVICES Net sales distribution 1-6/2017 By product area By segment Special vessels 7% (8) Offshore 7% (9) Field service 23% (24) Navy 9% (8) Spare parts Power plants 51% (51) 38% (37) Agreements 17% (15) Merchant Projects 23% (25) Cruise & ferry 9% (9) 16% (13) Total EUR 1,035 million (1,042) 11 ©
Slide 12: Installed base covered by service agreements
SERVICES Installed base covered by service agreements 20 000 30% 18 000 25% 16 000 14 000 20% 12 000 MW 10 000 15% 8 000 10% 6 000 4 000 5% 2 000 0 0% 2009 2010 2011 2012 2013 2014 2015 2016 1-6/2017 MW under agreement – Energy Solutions MW under agreement – Marine Solutions % of Energy Solutions’ i
Slide 13: Wärtsilä to install a hybrid system with batteries on board Eidesvik Offshore's vessel
Wärtsilä to install a hybrid system with batteries on board Eidesvik Offshore’s vessel • The Viking Princess is the first offshore supply vessel to replace a generator with batteries • The storage solution improves efficiency, generating fuel savings and reducing CO2 emissions Copyright: Eidesvik 13
Slide 14: Energy Solutions
ENERGY SOLUTIONS 14 © Wärtsilä PUBLI C 20 July 2017 Half year financial report 2017
Slide 15: 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 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Q1/2016 Q2/2016 Q3/2016 Q4/2016 Q1/2017 Q2/2017 Calculated on a 12 months rolling basis 15 © Wärtsilä PUBLI C 20 July 2017 Half year fina
Slide 16: Continued momentum in Energy Solutions' order intake
ENERGY SOLUTIONS Continued momentum in Energy Solutions’ order intake Review period development MEUR Total EUR 766 million (616) 1 800 10% Utilities 1 600 Independent 1 400 26% 64% power producers 1 200 Industrials 1 000 800 Review period order intake 600 by fuel in MW 400 Oil Gas 38% 62% 200 0 2013
Slide 17: Order intake globally
ENERGY SOLUTIONS Order intake globally Europe 198 (920) Asia 1,087 (368) 13 8 75 110 Americas 348 (299) 545 534 18 329 Africa and Middle East 173 (299) Utilities 23 IPP’s (Independent 100 50 Power Producers) Industrials Order intake 1-6/2017: 1,806 MW (1,886) 17 © Wärtsilä PUBLI C 20 July 2017 Half
Slide 18: Energy storage steps in to solve peaker plant crisis
Energy storage steps in to solve peaker plant crisis • Greensmith’s GEMS software platform selected when a sudden loss in peaker plant capacity in Pomona, California was replaced with energy storage • By leveraging major OEM relationships, North America’s largest and most complex energy storage syst
Slide 19: 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 4% (4) Wärtsilä 12% (13) Ansaldo GE 15% (10) 31% (31) MHI 15% (20) Siemens 24% (22) <500 MW market volume last 12 months: 28.4 GW (26.1) Total market volume last 12 months: 58.0 GW (64.8) Market shares are calculated on
Slide 20: Marine Solutions
MARINE SOLUTIONS 20 © Wärtsilä PUBLI C 20 July 2017 Half year financial report 2017
Slide 21: Marine market environment remains challenging
MARINE SOLUTIONS Marine market environment remains challenging 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 01.09 03.09 05.09 07.09 09.09 11.09 01.10 03.10 05.10 07
Slide 22: Marine Solutions' order intake supported by favourable vessel mix
MARINE SOLUTIONS Marine Solutions’ order intake supported by favourable vessel mix MEUR 1 800 Review period development Total EUR 725 million (741) 1 500 Offshore 2% Special vessels 1 200 6% 900 Gas carriers Cruise 29% 31% 600 300 Traditional 0 merchant Ferry 2013 2014 2015 2016 2017 18% 3% Others N
Slide 23: Wärtsilä's unique HY hybrid power module increases efficiency and flexibility
Wärtsilä’s unique Kuva HY hybrid power module increases efficiency and flexibility pitää vaihtaa, • The hybrid power module combines engines, energy storage, and power bonny electronics • Benefits include reduced fuel kalvon consumption and emissions, as well as improved vessel performance and safet
Slide 24: Market position of Wärtsilä's marine engines
MARINE SOLUTIONS Market position of Wärtsilä’s marine engines Medium-speed main engines Auxiliary engines Others Wärtsilä 17% (11) 8% (20) Caterpillar Wärtsilä 13% (17) 40% (45) Others 92% (80) MAN D&T 30% (27) Total market volume last 12 months: Total market volume last 12 months: 3,065 MW (2,235)
Slide 25: Financials
FINANCIALS 25 © Wärtsilä PUBLI C 20 July 2017 Half year financial report 2017
Slide 26: Cash flow from operating activities affected by increased receivables
FINANCIALS Cash flow from operating activities affected by increased receivables MEUR 700 600 Review period development MEUR 200 500 180 400 160 140 300 120 100 200 80 60 100 40 20 0 0 2013 2014 2015 2016 1-6/2016 1-6/2017 26 © Wärtsilä PUBLI C 20 July 2017 Half year financial report 2017
Slide 27: Working capital
FINANCIALS Working capital MEUR 1 600 25% 1 400 Review period development 20% MEUR 1 200 1 600 25% 1 000 1 400 15% 20% 1 200 800 10.8% 10.2% 1 000 13.8%* 15% 10% 12.1%* 600 543 800 490 680 6.8% 602 10% 400 5.2% 600 313 5% 251 400 5% 200 200 0 0% 0 0% 2013 2014 2015 2016 30.6.2016 30.6.2017 Working c
Slide 28: Gearing
FINANCIALS Gearing 0,50 Review period development 0,40 0,50 0,30 0,40 0,30 0,20 0,20 0,10 0,10 0,00 0,00 2013 2014 2015 2016 30.6.2016 30.6.2017 28 © Wärtsilä PUBLI C 20 July 2017 Half year financial report 2017
Slide 29: Prospects for 2017
Setti 1 Setti 1 Prospects for 2017 Wärtsilä's overall development in 2017 is expected to be relatively unchanged from the previous year. Demand by business area is anticipated to develop as follows: • Solid in Services with growth opportunities • Good in Energy Solutions • Solid in Marine Solutions
Slide 30: Thank you
THANK YOU Further information: Natalia Valtasaari Director, Investor & Media Relations Tel. +358 (0) 10 709 5637 E-mail: natalia.valtasaari@wartsila.com 30 © Wärtsilä PUBLI C 20 July 2017 Half year financial report 2017