Weir Group PLC · LSE:WEIR
Weir — The Weir Group — Non-Deal Roadshow (September 2012)
47 slides from Weir's roadshow presentation, September 2012
Slide 1: The Weir Group PLC September 2012 USA Roadshow
The Weir Group PLC September 2012 USA Roadshow Excellent Engineering Solutions
Slide 2: Contents
The Weir Group PLC September 2012 US Roadshow 2 Contents Group Overview Minerals division Oil & Gas division Power & Industrial division 2012 interim results review
Slide 3: Group overview
The Weir Group PLC September 2012 US Roadshow 3 Group overview Weir SPM, Texas, USA Excellent Engineering Solutions
Slide 4: Overview of The Weir Group PLC
The Weir Group PLC September 2012 US Roadshow 44 Overview of The Weir Group PLC Revenue OE / Aftermarket 100 80 49 46 42 48 46 Established global engineering solutions provider aligned to 60 (%) high growth end-markets 40 51 54 58 52 54 20 Minerals 0 Oil & Gas 2008 2009 2010 2011 H1 2012 Aftermarket
Slide 5: Weir Group strategy
The Weir Group PLC September 2012 US Roadshow 5 Weir Group strategy End-market focus Business model Oil & Gas Minerals Power Organisational focus Product focus Highly engineered products Mechanical, flow control bias Technological differentiation Process critical Abrasive, HP/HT applications Afterma
Slide 6: A track record of uninterrupted growth
The Weir Group PLC September 2012 US Roadshow 6 A track record of uninterrupted growth Delivering Delivering balanced balanced growth growth ahead ahead of of our our end end markets markets 2006 EBITA per annual report and accounts reported operating profit which includes £2.5m of amortisation
Slide 7: Weir Minerals
The Weir Group PLC September 2012 US Roadshow 7 Weir Minerals Weir Minerals - Artarmon, Australia Excellent Engineering Solutions
Slide 8: Minerals division overview
The Weir Group PLC September 2012 US Roadshow 8 Minerals division overview Best in class equipment and service provider for operation critical processes Specialist equipment targeting high wear mining applications Mill circuit - comminution - slurry transportation - mine dewatering - speciality pump
Slide 9: Minerals processing: operation critical high wear applications
The Weir Group PLC September 2012 US Roadshow 9 Minerals processing: operation critical high wear applications Comminution Mill circuit Slurry transportation Mine dewatering
Slide 10: Diverse global business
The Weir Group PLC September 2012 US Roadshow 10 Diverse global business Geographic mix1 100 80 57 Global presence covering all key mining geographies 60 62 66 70 68 40 20 43 38 34 32 30 Emerging market contribution increased from 37% to 48% 0 2007 2008 2009 2010 2011 Exposure to US & European marke
Slide 11: Minerals division financial performance
The Weir Group PLC September 2012 US Roadshow 11 Minerals division financial performance Input £m Revenue £m Operating profit £m 1,500 1,500 250 20% 1,250 1,250 200 18% 1,000 42% 1,000 42% 150 16% 750 750 39% 38% 214 52% 41% 48% 100 14% 500 500 49% 175 54% 141 58% 51% 58% 130 61% 50 12% 250 48% 59%
Slide 12: Market forecasts
The Weir Group PLC September 2012 US Roadshow 12 Market forecasts Ore production by key commodity, million tonnes Capital expenditure: project type, US$bn 8,000 90 7,000 80 6,000 70 60 5,000 50 4,000 40 3,000 30 2,000 20 1,000 10 0 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2006 2007 2008 2
Slide 13: OE input secured to drive 2013-15 aftermarket growth
The Weir Group PLC September 2012 US Roadshow 13 OE input secured to drive 2013-15 aftermarket growth Selected projects and expected commissioning date Weir OE input drives aftermarket revenue opportunity: illustrative, £m Comm. Project Name Country Commodity Date 700 Karara Australia Iron 2012 600
Slide 14: Weir Minerals: positioned for long term sustainable growth
The Weir Group PLC September 2012 US Roadshow 14 Weir Minerals: positioned for long term sustainable growth Revenue £m Medium term structural demand drivers remain intact 1,500 Installed based growing 1,250 Aftermarket driving organic growth 1,000 3% OE orders driving higher margin aftermarket reven
Slide 15: Weir Oil & Gas Division
The Weir Group PLC September 2012 US Roadshow 15 Weir Oil & Gas Division Weir Oil & Gas - Weir SPM, Texas, USA Excellent Engineering Solutions
Slide 16: Oil & Gas Division overview
The Weir Group PLC September 2012 US Roadshow 16 Oil & Gas Division overview Market leading position in Pressure Pumping and Flow Control equipment Leading North American wellhead equipment provider to the unconventional sector Niche position in centrifugal pumps for refining and petrochemicals Resp
Slide 17: Oil & Gas Division – products and services
The Weir Group PLC September 2012 US Roadshow 17 Oil & Gas Division – products and services Vertical pumps Process pumps Blow out preventer repairs Pump Multistage pumps Well heads and Frac Trees upgrade/repair Valve & Seats Frack & cement heads Valve & Seats Pump upgrade / repair Frack Pump Flow Co
Slide 18: Oil & Gas Division financial performance
The Weir Group PLC September 2012 US Roadshow 18 Oil & Gas Division financial performance £m 2008 (1) 2009 (1) 2010 (1) 2011 2011 Input by geography % (Pro-forma) Emerging Input OE 154 123 281 476 markets Input aftermarket 172 191 328 389 North America Input total 326 314 609 865 Europe & FSU Asia P
Slide 19: Pressure pumping businesses
The Weir Group PLC September 2012 US Roadshow 19 Pressure pumping businesses Pump market share Three businesses based in Texas SPM Gardner Denver FMC Weir SPM, Fort Worth Halliburton MSI Weir Mesa, Odessa Others Weir Novatech, Dallas, acquired February 2012 Flow market share Market leaders in pressu
Slide 20: Market outlook
The Weir Group PLC September 2012 US Roadshow 20 Market outlook 14 US gas rig count vs. gas prices 1800 Source: Baker Hughes and EIA 12 1600 Current overcapacity triggered by falling gas rig count 10 1400 Gas price fallen below $3.5-$4.0/mmbtu incentive price 8 1200 6 1000 Total horizontal rig count
Slide 21: Wellhead market and Seaboard's positioning
The Weir Group PLC September 2012 US Roadshow 21 Wellhead market and Seaboard’s positioning Surface equipment market 12% 5.0 CAGR 19% Large $4.25bn market in 2011 4.0 Approaching 20% p.a. growth since 2009 3.0 2.0 12% growth forecasted in 2012 1.0 Seaboard has a c.9% market share of the North Americ
Slide 22: Oil & Gas division – Positioned for long term sustainable growth
The Weir Group PLC September 2012 US Roadshow 22 Oil & Gas division – Positioned for long term sustainable growth Shale oil & gas changing the face of the US energy mix Revenue £m Positive long-term Increasing US appetite for energy independence 800 market fundamentals Material international shale g
Slide 23: Power & Industrial
The Weir Group PLC September 2012 US Roadshow 23 Power & Industrial Excellent Engineering Solutions
Slide 24: Overview
The Weir Group PLC September 2012 US Roadshow 24 Overview 2011 Input by sector % £m 2011 20101 20091 +/-3 12% 4% 13% Other 14% Input OE 165 146 105 +13% Oil & Gas Power Input aftermarket 147 118 146 +25% Industrial W ater Input Total 312 264 251 +18% 57% Revenue OE 173 112 92 +58% 2011 Input by geog
Slide 25: Business structure
The Weir Group PLC September 2012 US Roadshow 25 Business structure 5 businesses 9 production sites 3 sales hubs 13 service centres Over 2,000 employees Major customers LISCO - LIBYA
Slide 26: Product overview – Valves
The Weir Group PLC September 2012 US Roadshow 26 Product overview – Valves Isolation valves Applications Competitors Manufacturing Nuclear power Flowserve Elland, UK Thermal power Tyco Ipswich, US Sub sea O&G Velan Washington, US Downstream O&G GE Hubli, India Triple offset butterfly valve Suzhou, C
Slide 27: 2012 interim results review
The Weir Group PLC September 2012 US Roadshow 27 2012 interim results review Weir Advanced Research Centre, University of Strathclyde, Glasgow Excellent Engineering Solutions
Slide 28: Highlights
The Weir Group PLC September 2012 US Roadshow 28 Highlights Continuing operations Continued strong Minerals performance Order input(1) £1,312m Up 8% Positive organic growth in Power and Industrial Profit before tax(2) £226m Up 27% Challenging pressure pumping market conditions Cash generated from op
Slide 29: Results summary
The Weir Group PLC September 2012 US Roadshow 29 Results summary(1) 2012 2011 +/- £m £m Revenue 1,325 1,031 +29% Operating profit 248 186 +33% Operating margin 18.7% 18.0% +70bps Net finance costs (22) (8) +176% Profit before tax 226 178 +27% Profit for the period 161 127 +27% Effective tax rate 28.
Slide 30: Minerals Division
The Weir Group PLC September 2012 US Roadshow 30 Minerals Division Input OE / Aftermarket 100 £m 2011 H1(1) 2011 H2(1) 2012 H1 + / - (3) 80 44 39 43 60 Input OE 285 234 311 +9% (%) 40 56 61 57 Input aftermarket 367 363 415 +13% 20 Input total 652 597 726 +11% 0 2011 H1 2011 H2 2012 H1 Revenue OE 209
Slide 31: Oil & Gas Division
The Weir Group PLC September 2012 US Roadshow 31 Oil & Gas Division Input OE / Aftermarket 100 £m 2011 H1(1) 2011 H2(1) 2012 H1 + / - (3) 80 37 55 55 42 (%) 60 Input OE 222 260 158 -29% 40 63 58 20 45 45 Input aftermarket 179 214 215 +20% 0 Input total 401 474 373 -7% 2011 2011 2012 2012 H1 H2 H1 H1
Slide 32: Oil & Gas Division Managing conditions in upstream markets
The Weir Group PLC September 2012 US Roadshow 32 Oil & Gas Division US horizontal rig count, 2012 YTD Managing conditions in upstream markets 1,200 1,100 Flat total horizontal rig count 1,000 Rapid switch from gas to oil, total horizontal rig count stable 900 29% increase in oil rig count Gas rig co
Slide 33: Power & Industrial Division
The Weir Group PLC September 2012 US Roadshow 33 Power & Industrial Division Input OE / Aftermarket 100 £m 2011 H1(1) 2011 H2(1) 2012 H1 + / - (3) 80 53 52 51 48 60 Input OE 85 77 99 +17% (%) 40 Input aftermarket 76 70 97 +28% 20 47 48 49 52 0 Input Total 161 147 196 +22% 2011 2011 2012 2012 H1 H2 H
Slide 34: 2012 outlook
The Weir Group PLC September 2012 US Roadshow 34 2012 outlook Minerals Market conditions to remain generally positive Further input growth Increase in full year revenue expectations Full year margins in line with first half Oil & Gas Challenging pressure pumping market outlook Frac pump OE market un
Slide 35: Q&As
The Weir Group PLC September 2012 US Roadshow 35 Q&As Weir Minerals - San Paulo, Brasil Excellent Engineering Solutions
Slide 36: Appendices
The Weir Group PLC September 2012 US Roadshow 36 Appendices Weir P&I, Elland, UK Excellent Engineering Solutions
Slide 37: Minerals processing: from ore to concentrate
The Weir Group PLC September 2012 US Roadshow 37 Minerals processing: from ore to concentrate Comminution Mill circuit Slurry transportation Flotation, concentration & tailings Typical copper mine: 20,000 - 200,000 tonnes of ore processed per day Assuming 1% metal content this is the equivalent of £
Slide 38: World leading Warman slurry pumps
The Weir Group PLC September 2012 US Roadshow 38 World leading Warman® slurry pumps Highly abrasive mill circuit application: moves ore through the processing circuit Superior performance through patented materials and engineered hydraulics Throughput increased, energy consumption, maintenance and d
Slide 39: Leading Cavex hydro-cyclones
The Weir Group PLC September 2012 US Roadshow 39 Leading Cavex® hydro-cyclones Separates ore from rock through centrifugal force Improved performance via patented technology: enhances flow control, reduces turbulence Throughput increased, lower maintenance costs
Slide 40: Vulco custom designed mill lining systems
The Weir Group PLC September 2012 US Roadshow 40 Vulco® custom designed mill lining systems Aftermarket mill liners protect mill casing and maximise rock grinding Utilises patented elastomer technology to improve wear life Throughput increased, lost production time minimised
Slide 41: KHD high pressure grinding rolls (HPGR)
The Weir Group PLC September 2012 US Roadshow 41 KHD high pressure grinding rolls (HPGR) Choke Feed Edge-Effects Wear Surface with Hardmetal Studs Pre-crushing zone Compression Zone Peak Pressure Flake Product Redefining the largest minerals processing operation in partnership with KHD More effectiv
Slide 42: Complementary mill circuit components
The Weir Group PLC September 2012 US Roadshow 42 Complementary mill circuit components Valves, spools, hoses, screens, targeted at abrasive mill circuit applications Utilises our expertise in materials technology and fluid dynamics Enhanced wear life over traditional market products
Slide 43: Pressure Pumping – SPM products
The Weir Group PLC September 2012 US Roadshow 43 Pressure Pumping – SPM products High Pressure Well Service Pumps Destiny™ TWS 2500 Frac Pump 600 – 1,000 hp well service pumps for cementing, acidizing & coiled tubing applications 2,250 – 3,500 hp frac pumps Supported by key aftermarket partners Mesa
Slide 44: Pressure Pumping – Novatech & MESA products
The Weir Group PLC September 2012 US Roadshow 44 Pressure Pumping – Novatech & MESA products SPM Destiny™ TWS 2500 frac pump Fluid end and associated component parts Novatech Discharge valve Discharge valve seat Fluid end Power end Mesa Plunger Suction valve Suction valve seat Novatech Adding Adding
Slide 45: Product overview – Hydro turbines
The Weir Group PLC September 2012 US Roadshow 45 Power & Industrial Division Product overview – Hydro turbines Manufacturing Applications Competitors Manufacturing Up to 50MW Alstom York, hydro turbines Pennsylvania Andriz Montreal, Canada Voith Siemens 65,000 HP pump impeller Service Applications C
Slide 46: Product overview – Specialty Pumps
The Weir Group PLC September 2012 US Roadshow 46 Power & Industrial Division Product overview – Specialty Pumps Rotojet high pressure pump Applications Competitors Manufacturing Waste water KSB Salt Lake City, US Conventional Gorman Rupp power Upstream O&G Dewatering Wemco torque flow pump Wemco non
Slide 47: Product overview – Services
The Weir Group PLC September 2012 US Roadshow 47 Power & Industrial Division Product overview – Services Conventional, wind and nuclear power outage and service Applications Competitors Base Nuclear outage In-house Alloa, UK Conventional Sulzer Barton, UK power outage Wood Group Madrid, Spain Wind t