Metso Corporation · OMXHEX:METSO
Metso — Metso Outotec — Investor Presentation (May 2022)
72 slides from Metso's investor presentation, May 2022
Slide 1: Investor presentation May 2022
Investor presentation May 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
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: 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 12: Metso Outotec growth areas
Metso Outotec growth areas Products with Sustainable Automation & China & high aftermarket offering digitalization Silk Road intensity
Slide 13: 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 14: 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 15: 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 16: …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 17: …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 18: …and a good position in fast-emerging battery metal 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 19: Sustainability, R&D and people
Sustainability, R&D and people
Slide 20: Addressing the climate challenge
Up to 5% of the world's energy consumption is used in comminution Addressing the climate Around 1% challenge of the worlds power runs through our equipment • Our customer industries are in transition from coal to renewables and towards low-carbon operations, electrification and interruptible power.
Slide 21: 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 22: 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 23: Emissions related key facts
Emissions related key facts • CO2 emissions footprints: ‒ Global CO2 footprint 32 billion tons ‒ Power 10 billion tons ‒ Mining 500 million tons of which ‒ comminution and processing ~200 million tons ‒ Aggregates 100-200 million tons • Metso Outotec CO2 emissions in 2021: ‒ Scope 1 and 2*: 134 kton
Slide 24: Our handprint is significantly bigger than our footprint
Our handprint is significantly bigger than our footprint CO2 Handprint** in 2021 CO2 Footprint* in 2021 10.3 million <1 million tonnes tonnes *Footprint = emissions generated in production, logistics, **Handprint = emissions avoided in customer operations across purchased goods and services as well
Slide 25: Science Based Targets (SBTi) to align with the Paris agreement
Science Based Targets (SBTi) to align with the Paris agreement We are committed to the 1.5-degree journey Our targets Our results • Paris agreement commits to limit the CO2 emissions in CO2 emissions in global warming to our own operations* own operations 1.5 degree by 2100 -50% Emissions reduced -5
Slide 26: Other sustainability targets
Other sustainability targets Planet Positive sales Sustainable R&D EUR 592 million in 95% in 2021 2021 Target: +3% faster than overall sales Target: 100% of R&D to have sustainability targets TRIFR TRIFR TRIFR TRIFR LTIFR Water usage in water scarce (total recordable injury frequency rate) (lost tim
Slide 27: Making an environmental impact with Planet Positive offering
Making an environmental impact with Planet Positive offering Planet Positive criteria: • Over 100 Planet Positive products and services • Energy efficiency – Demonstrably better than the industry benchmark • Carbon efficiency – Help our customers achieve their climate and other • Optimized for using
Slide 28: We are an enabler for net zero and decarbonization
We are an enabler for net zero and decarbonization Biggest impact is through our customers with technology and innovation Aggregates Minerals processing Minerals processing Metals refining • Energy efficiency • Energy efficiency • Energy efficiency • Electrification • Water • Water • Circularity • C
Slide 29: Examples of our Planet Positive solutions
Examples of our Planet Positive solutions 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 wate
Slide 30: Examples of our Planet Positive solutions
Examples of our Planet Positive solutions 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 consumption redu
Slide 31: 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 32: Strong innovation and R&D power
Strong innovation and R&D power 15+ 70 30 95% 6,800+ million euros New Planet Investment in R&D centers, R&D project Patents Positive launches research and co-creating spend with in 2021 development in and customizing sustainability 2021 solutions to targets in 2021 customers
Slide 33: All R&D with sustainability targets
All R&D with sustainability targets – to further develop the Planet Positive portfolio • Future mobile crushing & screening technologies Future aggregate concepts • Future crushing technologies • Preconcentration Smart and Planet Positive Water efficiency solutions for minerals • Comminution • Separ
Slide 34: 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 35: Uncompromised safety in offering and operations
Uncompromised safety in offering and operations LTIFR* (2021) 1.1 Long-term target Zero harm v TRIFR** (2021) Health and safety Safe products Safe and responsible 3.2 of people and services supply chain Long-term target • Safe and secure workplace • Products designed for safety • Rigorous supplier s
Slide 36: 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 37: Our sustainability approach: People
37 Our sustainability approach People We respect all applicable national and international laws, regulations and human rights. We are committed to fair treatment for all employees regardless of gender, age, race, religion or beliefs, ethnic or national origins, marital/civil partnership status, sexu
Slide 38: Metso Outotec leadership team
Metso Outotec leadership team Extended Metso Outotec Executive Team Metso Outotec Executive Team CEO Pekka Vauramo CFO and Business Legal & Compliance development Nina Kiviranta Eeva Sipilä HR Carita Himberg Minerals Aggregates Metals Services Consumables Markku Markku Simula Piia Karhu Sami Takaluo
Slide 39: Our offering
Our offering Metso:Outotec
Slide 40: 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 41: 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 42: 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 43: 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 44: 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 45: 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 46: Presence in the whole ore to metals value chain
Presence in the whole ore to metals value chain Examples of our sustainable offering
Slide 47: 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 48: 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 49: We will accelerate the sales of Over 100 Planet Positive products
We will accelerate the sales of Over 100 Planet Positive products Energy and emission Energy and emission Energy and emission Energy and emission efficient solutions efficient solutions efficient solutions efficient solutions Minerals: HRCe Minerals: Vertimill Aggregates: Lokotrack e- Metals: Flash
Slide 50: We will accelerate the sales of Over 100 Planet Positive products
We will accelerate the sales of Over 100 Planet Positive products Water efficient Water efficient Water efficient Water efficient solutions solutions solutions solutions Minerals: Paste thickener Minerals: Tailings dewatering Minerals: Pebble mills Minerals: Raw water treatment Cost-effective techno
Slide 51: We will accelerate the sales of Over 100 Planet Positive products
We will accelerate the sales of Over 100 Planet Positive products Circular Circular Circular Circular solutions solutions solutions solutions Aggregates: Lokotrack impact Services: Float Force upgrade Services: Life extension Consumables: Truck body crushers Increases recovery energy Upgrades and mo
Slide 52: Capturing the value of ore, responsibly
Capturing the value of ore, responsibly Leading offering for minerals processing and metals recovery Broad offering ranging Driving Planet Positive from pre-feasibility studies, flowsheets: range of over engineering and process 50 Planet Positive equipment to complete products continuously process i
Slide 53: Sustainable Services
Sustainable Services • Widest sustainability offering for our Globally 400+ Life Cycle Services contracts customers and improvement opportunities across the flowsheet. • Upgrades and modernizations allow customers to process more efficiently or No use less power, reduce or eliminate the compromise w
Slide 54: 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 55: 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 56: 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 57: 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 58: Q1/2022 results
Q1/2022 results Metso:Outotec
Slide 59: Q1 in short
Q1 in short • Strong market activity continued across all businesses • Solid sales growth • Profitability improved thanks to sales growth, synergies and other actions • Good progress in sustainability • Uncertainty caused by Russia's military offensive against Ukraine
Slide 60: Group key figures
Group key figures EUR million Q1/2022 Q1/2021 Change % Orders received 1,424 1,102 29 Sales 1,164 925 26 Adjusted EBITA 157 115 37 % of sales 13.5 12.4 – Operating profit 139 91 53 % of sales 12.0 9.8 – Earnings per share, continuing operations, EUR 0.11 0.08 32 Cash flow from operations 74 165 -55
Slide 61: Aggregates segment quarterly highlights
Aggregates segment quarterly highlights • Orders received EUR 402 million (EUR 356 EUR million % million) ◦ Strongest growth in North America and China ◦ Equipment up 10%, services 19% • Sales EUR 329 million (EUR 265 million) ◦ Growth supported by backlog ◦ Services share 34% (32%) • Adjusted EBITA
Slide 62: Minerals segment quarterly highlights
Minerals segment quarterly highlights • Orders EUR 880 million (EUR 677 million) EUR million % ◦ Strong market activity thanks to high commodity prices and production volumes ◦ Equipment orders +44% ◦ Services orders +23% • Sales EUR 731 million (EUR 605 million) ◦ Equipment +49% ◦ Services +6% ◦ Se
Slide 63: Metals segment quarterly highlights
Metals segment quarterly highlights • Orders received EUR 141 million (EUR 69 EUR million % million) ◦ Several orders for pellet plants and shutdown services • Sales EUR 104 million (EUR 55 million) ◦ Supported by backlog ◦ Services share 12% (17%) • Adjusted EBITA EUR 10 million (EUR -4 million) ◦
Slide 64: Russia business update
Russia business update • Priority is the safety and well-being of our personnel • No new orders accepted since late February • We are working to wind down existing contracts and deliveries to non- sanctioned customers during the coming months • Originally planned Q2-Q4/22 sales to Russia were EUR 31
Slide 65: Income Statement
Income Statement EUR million Q1/2022 Q1/2021 2021 Sales 1,164 925 4,236 Adj. EBITA 157 115 547 Adj. EBITA, % 13.5 12.4 12.9 Operating profit 139 91 425 Operating profit, % 12.0 9.8 10.0 Net financial expenses -20 -7 -39 Profit before taxes 119 84 385 Income taxes -32 -21 -92 Profit for the period, c
Slide 66: Balance Sheet
Balance Sheet Restated Net debt continued to decline EUR million EUR million Mar 31, 2022 Mar 31, 2021 Dec 31, 2021 Intangible assets 1,993 1,994 2,002 Total property, plant and equipment 388 361 373 Right-of-use assets 123 136 127 Other non-current assets 267 252 234 Inventories 1,430 1,113 1,269 R
Slide 67: Cash Flow
Cash Flow Cash flow from operations EUR million Q1/2022 Q1/2021 2021 EUR million Profit for the period 88 59 342 Adjustments: Depreciation and amortization 38 39 167 Financial expenses, net 20 7 39 Income taxes 31 20 92 Other items 3 10 -2 Total adjustments 93 76 297 Change in net working capital -1
Slide 68: Financial position
Financial position • Early EUR 50 million repayment of a bank Restated term loan EUR million Mar 31, 2022 Mar 31, 2021 Dec 31, 2021 • Undrawn EUR 100 million loan from the Liquid funds 501 516 473 Nordic Investment Bank Net debt 443 675 470 • Ratings: Gearing, % 18.6 31.7 20.9 ◦ S&P (February 2022):
Slide 69: Portfolio development
Portfolio development • Hydrometallurgy moved from Metals to Minerals ◦ Opportunities and synergies in minerals processing ◦ Integrated Planet Positive offering • Remaining Metals businesses under strategic review ◦ Smelting ◦ Metals & Chemical Processing ◦ Ferrous & Heat Transfer • Acquisition of T
Slide 70: Sustainability highlights in Q1/2022
Sustainability highlights in Q1/2022 • Good progress with sustainability agenda • Four Planet Positive launches (e.g. digital twin) Planet Positive sales of • Several energy savings actions implemented in EUR 636 own operations to support emissions reductions million* • Green gas certificate initiat
Slide 71: Market Outlook
Market Outlook Market activity is expected to remain at the current strong level. According to its disclosure policy, Metso Outotec’s market outlook describes the expected sequential development of market activity during the following six-month period using three categories: improve, remain at the c
Slide 72: mogroup.com
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