Smiths Group PLC · LSE:SMIN
Smiths — Investor Day (January 2008)
44 slides from Smiths's investor day presentation, Jan 16, 2008
Slide 1: John Crane, Investor visit to Slough
Smiths Group John Crane, Investor visit to Slough Wednesday 16 January 2008 Register here to receive regular information ½ www.smiths.com/ir 1
Slide 2: Investor Day Agenda
Investor Day Agenda 10:15 Welcome and Introduction: 11:25 Tour of facility Steve Warren, 12:35 Wrap up and Q&As: John Director, Investor Relations Langston, Paul Cox and 10:20 Specialty Engineering Mike Mansell Presentation: Paul Cox, GMD 12:45 Buffet lunch 10:30 John Crane Presentation: 13:10 Depar
Slide 3: Smiths Group: well positioned for growth in resilient markets
Smiths Group: well positioned for growth in resilient markets Smiths Detection By business segment Smiths Medical A market and technology A strong niche player in leader in detection the medical device sector Detection Medical John Crane Spec Eng other Specialty Engineering UK/Eur By John Crane: A g
Slide 4: Smiths Detection: Airports, rapid developments in airport security present new opportunities
Smiths Detection: Airports, rapid developments in airport security present new opportunities Today Next generation Advanced Checkpoint X-ray Technology (AT) X-ray aTiX US: CT Checked Regulation baggage evolving RoW: AT (supplemented by CT) EDtS New Improvised Trace Conventional Explosive detection t
Slide 5: Smiths Detection: Other growth drivers ahead
Smiths Detection: Other growth drivers ahead Period of strong growth Ports & • Concerns on border security drive demand Borders • Sales doubled in 2007 • Russian factory operational Major military • US Chemical Biological Protection System programmes (CBPS) now in prototype stage • JCAD US manpack -
Slide 6: Smiths Medical
Smiths Medical Addressable market c£3.5bn Market size Market Smiths Medical Smiths Medical Medication Vital growth sales FY07 approx share Delivery Care Medication Delivery c£1.5bn 6% c£250m 17% Vital Care c£1.5bn 4% c£300m 20% Safety Devices c£0.5bn 6% c£150m 30% Total c£3.5bn 5% c£700m 20% Safety
Slide 7: Smiths Medical: Leading brands in the respective fields
Smiths Medical: Leading brands in the respective fields 7
Slide 8: Smiths Group: well positioned for growth in resilient markets
Smiths Group: well positioned for growth in resilient markets By business segment Smiths Detection Smiths Medical A market and technology A strong niche player in leader in detection the medical device sector Detection Medical John Crane Specialty Engineering Spec Eng other By UK/Eur John Crane: A g
Slide 9: Smiths Specialty Engineering
Smiths Specialty Engineering Paul Cox speaking Interconnect 2007 sales: £233m Flex-Tek 2007 sales: £217m John Crane 2007 sales: £532m 9
Slide 10: Specialty Engineering markets
Specialty Engineering markets t ec e ran 2007 sales by markets nn ek Markets C o x- T erc hn Fle Jo Int Petrochem lamo GDP Petrochem 35% 37% ial Mil/Aero En tr us erg In d y Wireless Comms lamo Other Energy Other Grow th 3% Other Energy Wireless 2% Other Growth 7% Mil/Aero 16% GDP lamo £1,033m Two t
Slide 11: Building of Smiths Specialty Engineering
Building of Smiths Specialty Engineering 2007 Divested Marine 2007 Acquired Sartorius Bearings Proceeds from sales £1,000m 2007 Divested Times Microwave sales Acquisition costs £200m 2007 Acquired CDI Energy Services 2006 Acquired Lorch Microwave 2005 Acquired Millitech Inc 2005 Acquisition of Hi-Te
Slide 12: Interconnect
Interconnect Interconnect is a global electronic components and sub-systems manufacturer providing signal, power and microwave capability to the military & aerospace, wireless infrastructure and other industries. Our products are application specific and incorporate innovative technologies to achiev
Slide 13: Interconnect electronics technologies
Interconnect electronics technologies Microwave Components and sub-systems used in the generation, transmission, receipt and processing of high frequency signals Connectors Application specific high reliability electrical interconnect solutions Protection Components used to protect high value electr
Slide 14: Interconnect electronics technologies - Microwave system application
Interconnect electronics technologies - Microwave system application Antenna Microwave/RF System Power Amplifier Power Transceiver Communications Supply systems Low Noise Amplifier Sensor systems 14
Slide 15: Interconnect electronics technologies - Where our products are used
Interconnect electronics technologies - Where our products are used Power amp Termination Resistors Isolators Attenuators Couplers Antenna products Antennas Transceiver Antenna Microwave/RF System products Positioners Lightning protection Combiners Phased arrays Dividers Power
Slide 16: Flex-Tek
Flex-Tek Flex-Tek design and manufacture engineered components which heat and move fluids and gases for aerospace, housing, domestic appliances and medical devices. www.wereflexible.com 16
Slide 17: FlexTek - Engineered flow/heat technology
FlexTek - Engineered flow/heat technology Engineered Flow • Proprietary hose and tubing technology • Total system provider for natural gas delivery • Patented fitting design and leader in code development • Precision fluoropolymer extrusion and braiding • Complex rigid tubing assemblies in high ferr
Slide 18: FlexTek - Engineered flow/heat applications and markets
FlexTek - Engineered flow/heat applications and markets Engineered Flow • Appliances - Leading global provider of specialist hoses for the treatment of sleep apnea and floor care equipment • Aerospace - Global manufacturer of rigid and flexible engineered fluid distribution solutions for aerospace a
Slide 19: John Crane
John Crane John Crane is the market leader, designing and manufacturing seals and associated products for the oil & gas, chemical, pharmaceutical, pulp & paper and mining sectors. www.johncrane.com 19
Slide 20: John Crane market offering
John Crane market offering Aftermarket Expanded New service offering aftermarket aftermarket opportunities: opportunities e-commerce + asset management CDI John Crane: Technology Leveraging into Seals and Couplings Expansion: adjacencies Bearings & Condition Monitoring CDI 20
Slide 21: John Crane Overview
John Crane Overview Presenter: Mike Mansell Financial performance • Sales: £532m OEM • Margin: 14.1% 38% • Employees: 6,100 532m 518m • Global market access End User • Over 40% of employees in customer 62% facing roles Sales by Channel 12.8% 14.1% • Two thirds of revenue from service 2006 2007 and a
Slide 22: John Crane - Where We Operate
John Crane - Where We Operate Minerals OEM Auto 2% 38% Power & Water 5% 5% Pulp & Paper 5% General End User Industries Oil and Gas 62% 15% 42% Sales by Channel Chemical S. America Processing 8% 26% Asia-Pacific 9% Sales by Market £532m Europe/ME/ Africa 45% N. America 38% Sales Profile - By Region 2
Slide 23: John Crane – Operations excellence
John Crane – Operations excellence Low cost manufacturing • Czech and India – Standard cartridge and coupling manufacture • China and Mexico – Volume production • India – Back office support, Design, projects, HR, eBusiness, Marketing Integrated Business System – SAP • £20m investment in an integrat
Slide 24: John Crane - Customers
John Crane - Customers First-fit Supply to Original Aftermarket Supply and Value-Added Equipment Manufacturers Services to Operating Facilities SBW 24
Slide 25: John Crane - Global Reach
John Crane - Global Reach • John Crane key intrinsic strengths: – Customer intimacy – High proportion of aftermarket activity – Unequalled sales and service infrastructure – Industry strength and knowledge in O&G sector • Aftermarket sales: £340M • Typical plant generates 30 years spares business •
Slide 26: John Crane - Operating In All Segments Of The Oil & Gas Field
John Crane - Operating In All Segments Of The Oil & Gas Field Upstream • Oil & Gas extraction and initial processing • Production stimulation (injection / produced water re-injection) Midstream • Crude and End Product Pipelines (Liquids) • Gas Pipelines (Compression) • LNG (Compression and shipping)
Slide 27: John Crane – Investment Projects
John Crane – Investment Projects Areas of Oil & Gas investment 1 1) Canada – Oil Sands 3 2) Angola – Deep water 3) Russia/China – Pipeline 5 6 4) Venezuela - Pipeline 4 5) Qatar – LNG 2 6) Asia – Ethylene crackers 2007 Capex investment Upstream $150bn Midstream $15bn Downstream $50bn Downstream Opex
Slide 28: What we do: Mechanical Seals for Pumps
John Crane - What we do Extraction and Refining Process Mechanical Seals for Pumps • High pressure for main oil line pumps • Sea water injection pump seal • Shipping and service pumps 28
Slide 29: What we do: Couplings for Pumps and Compressors
John Crane - What we do Extraction and Refining Process Couplings for Pumps and Compressors • Strong premium brand • Preferred choice in the Oil industry • Largest 10MW and 3.2 ton 29
Slide 30: What we do: Dry Gas Seals and Systems
John Crane - What we do Extraction and Refining Process Dry Gas Seals and Systems for Turbo Compressors • Replaced conventional technology • Now fitted to most turbo compressors 30
Slide 31: What we do: Engineered Bearings
John Crane - What we do Extraction and Refining Process Engineered Bearings for Rotating Equipment • Recent acquisition • Excellent fit with gas seals • Technology development opportunity • Aftermarket opportunity 31
Slide 32: What we do: Artificial Lift Rod Pump
John Crane - What we do Extraction Process Artificial Lift Rod Pump • Recent acquisition of CDI Energy services • Focus on Upstream Energy market • Strategy to grow through related acquisitions – Fit with existing core markets – Leverage the John Crane global footprint 32
Slide 33: What we do: Rotating Equipment Performance Management
John Crane - What we do Extraction and Refining Process Rotating Equipment Performance Management • Shared benefit agreements • Long term customer relations • Cross selling opportunities Oil & Water Chemistry Consultancy 33
Slide 34: A Passion for Innovation Timeline
John Crane - A Passion for Innovation Presenter : Michael Hall Timeline 34
Slide 35: A Passion for Innovation: Dry Gas Seal Technologies
John Crane - A Passion for Innovation Dry Gas Seal Technologies Dry Gas Seal - Spiral grooves etched into seal face provide hydrodynamic Largest:- lift-off, separating faces on a film of • Advanced sealing technology developed up to gas. Quantity, shape, and depth of 350mm diameter seal grooves dict
Slide 36: A Passion for Innovation: Bearing Technologies
John Crane - A Passion for Innovation Bearing Technologies Bearing Technology - For the most advanced rotating equipment Types:- used within the oil and gas and • Multi Lobe power generation industries. • Tilting pad • Combined Applications:- • High performance rotating equipment • Compressors • Pum
Slide 37: A Passion for Innovation: Seal Support Systems
John Crane - A Passion for Innovation Seal Support Systems Seal Support Systems Control the environment around the Types/applications:- seal for safe, reliability and efficient operation of process plant INOVIT • Dry Gas Seal modular support & conditioning systems for Turbocompressors Wet Seal Suppo
Slide 38: A Passion for Innovation: Asset Management Solutions
John Crane - A Passion for Innovation Asset Management Solutions Asset Management Solutions Smart systems with embedded intelligence to deliver valuable business solutions for asset • Delivers state-of-the-art software and management hardware solutions to implement Condition Based Maintenance (CBM)
Slide 39: A Passion for Innovation: Asset Management Solutions
John Crane - A Passion for Innovation Asset Management Solutions Asset Management Solutions Equipment Monitoring Applications:- Smart systems with embedded 3 in 1 intelligence to deliver valuable • Seal support systems monitoring business solutions for asset Dart 1 management • Vibration, Temperatur
Slide 40: John Crane – Business Development
John Crane – Business Development • Record of continuous investment • Expanding technologies • Leveraging adjacencies • Leveraging low cost operations • Improving the business mix 40
Slide 41: John Crane - Summary
John Crane - Summary • John Crane has excellent future prospects £2bn £5bn • Market outlook remains strong Fluid Management • Continuous Business Improvement Turbomachinery • Low cost manufacturing Upstream Energy • LIFE Sealing • Integrated Business System – SAP Solutions • Business Mix • Increased
Slide 42: John Crane – Questions and Answers
John Crane – Questions and Answers 42
Slide 43: Site Tour
Site Tour • 4 groups colour coded with badges • Four zones to visit – Factory Tour – Test Facility – Enabling Technology – Aftermarket • Demonstration Areas – SPECAC – Asset Management Solutions – Oil Plus 43
Slide 44: Investor Day – John Crane: Questions and answers
Smiths Group Investor Day – John Crane Slough, 16 January 2008 Questions and answers www.smiths.com © 2006 by Smiths Group: Proprietary Data44