Slide 1: Interim Report January-June 2013
INTERIM REPORT JANUARY-JUNE 2013 BJÖRN ROSENGREN, PRESIDENT & CEO 18 JULY 2013 © Wärtsilä
Slide 2: Highlights Q2/2013
Highlights Q2/2013 • Order intake EUR 1,071 million, -11% • Net sales EUR 1,152 million, +5% • Book-to-bill 0.93 • EBITA EUR 119 million, 10.3% of net sales • Operating result (EBIT) EUR 111 million, NEW 9.6% of net sales PIC • EPS EUR 0.39 (0.38) • Cash flow from operating activities EUR 38 million
Slide 3: Order intake development
Order intake development MEUR 5500 5000 4500 4000 Second quarter development MEUR 3500 1400 3000 1 198 1200 -11% 1 071 2500 1000 1% Services 2000 800 Ship Power 1500 -15% 600 Power Plants 1000 400 500 -23% 200 0 0 2009 2010 2011 2012 1-6/2013 Q2/2012 Q2/2013 3 © Wärtsilä
Slide 4: Net sales developed according to expectations
Net sales in Net sales developed according toline with our expectations expectations MEUR 5500 5000 -13% 4500 12% 4000 Second quarter development -7.6% 3500 MEUR 1400 3000 1 152 1200 1 099 5% 2500 1000 Services 2000 800 4% Ship Power 1500 600 Power Plants 1000 6% 400 500 200 4% 0 0 2009 2010 2011 20
Slide 5: Net sales by business 1-6/2013
Net sales by business 1-3/2012 Net sales by business 1-6/2013 Ship Power 28% (25) Services 44% (45) Power Plants 28% (30) 5 © Wärtsilä
Slide 6: Book-to-bill ratio remains above one
Book-to-bill ratio remains above one MEUR 6000 1,4 5500 1.19 1,2 5000 1.07 1.05 4500 1,0 4000 0.88 3500 0,8 3000 0.63 2500 0,6 2000 0,4 1500 1000 0,2 500 0 0,0 2009 2010 2011 2012 1-6/2013 Order intake Net sales Book-to-bill 6 © Wärtsilä
Slide 7: Solid order book supports guidance
Solid order book supports guidanceOrder book distribution MEUR 4000 3000 2000 1000 0 30.6.2012 30.6.2013 Delivery current year Delivery next year or later 7 © Wärtsilä
Slide 8: Profitability
Profitability MEUR 250 16% 14% 12.8% 200 11.5% 11.7% EBIT% 11.0% 12% 12.1% target: 10.3% 11.1% 10-14% 10.7% 10.9% 10% 150 9.6% 8% 100 6% 4% 50 2% 0 0% 2009 2010 2011 2012 2013 Q1 Q2 Q3 Q4 EBITA% (operating result before non-recurring items and intangible asset amortisation related to acquisitions) E
Slide 9: Power plant market activity stable
Power plant market activity stable
Slide 10: Power Plants – quoted MW per fuel type
Power Plants – quoted MW per fuel type 16000 14000 12000 10000 Others MW 8000 6000 Natural gas 4000 Heavy fuel oil 2000 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2005 2006 2007 2008 2009 2010 2011 2012 2013 Share of natural gas is consist
Slide 11: Power Plants quarterly order intake
Power Plants quarterly order intake MEUR 600 500 400 300 200 100 0 2006 2007 2008 2009 2010 2011 2012 2013 Q1 Q2 Q3 Q4 11 © Wärtsilä
Slide 12: Power Plants order intake by customer segment
Power Plants order intake by customer segment MEUR Review period development 2000 Total EUR 623 million (591) 1800 10% Utilities 1600 43% Industrials 1400 47% IPP’s 1200 x% 1000 800 Review period order intake by fuel in MW 600 400 Oil Gas 200 18% 82% 0 2009 2010 2011 2012 1-6/2013 12 © Wärtsilä
Slide 13: Major gas engine power plant order from Russia
Major gas engine power plant order from Russia • The 110 MW natural gas fuelled power plant unit in Tikhvin, Leningrad region, will be the first of its kind in Russia • Wärtsilä will supply the technology and engineering, supported by installation and commissioning assistance • The solution will pro
Slide 14: Power Plants - global order intake
Power Plants - global order intake Europe 220 (19) Asia 210 (771) 54 50 25 Americas 324 (425) 141 160 10 47 Africa and Middle East 359 (186) 27 18 268 Utilities IPP’s Industrials 314 Order intake 1-6/2013: 1,113 MW (1,401) 14 © Wärtsilä
Slide 15: Market for gas and liquid based power plants
Market for gas and liquid based power plants 2012 Total market 75.4 GW 4.2% 3.8% 3.6% GE Siemens 4.8% MHI 34.2% Alstom 20.6% Wärtsilä Ansaldo 28.8% Other GTs Includes all Wärtsilä power plants and other manufacturers’ gas and liquid fuelled power plants with prime movers above 5MW, as well as estima
Slide 16: Ship Power market activity showing signs of improvement
Ship Power market activity showing signs of improvement
Slide 17: Vessel order development
# of vessels 100 120 140 0 20 40 80 60 01.09 17 © Wärtsilä 02.09 03.09 04.09 05.09 06.09 07.09 08.09 Merchant 09.09 10.09 11.09 Source: Clarkson Research Services 12.09 01.10 02.10 Offshore 03.10 04.10 * CGT= gross tonnage compensated with workload 05.10 06.10 07.10 08.10 09.10 10.10 11.10 Vessel or
Slide 18: Ship Power order intake by segment
Ship Power order intake by segment MEUR 1600 Review period development Total EUR 822 million (723) Merchant Offshore 1200 33% 43% 800 400 Other 4% Special vessels Cruise Navy 8% & ferry 4% 0 7% 2009 2010 2011 2012 1-6/2013 18 © Wärtsilä
Slide 19: Harvey Gulf to use Wärtsilä's integrated solution
Harvey Gulf to use Wärtsilä’s integrated solution • Order to supply an integrated solution for a new multipurpose support vessel • Scope of supply includes the engines, a turnkey installation of the Wärtsilä Control & Communication Centre (3C) and the complete electrical and automation system • Incl
Slide 20: Joint venture ordering activity
Joint venture ordering activity MEUR 600 • Order intake in Wärtsilä Hyundai 550 Engine Company Ltd in South 500 Korea, and Wärtsilä Qiyao Diesel 450 Company Ltd in China totalled 400 EUR 113 million (148) during the 350 review period January-June 2013 300 • Wärtsilä’s share of ownership in these com
Slide 21: Ship Power Market: market position of Wärtsilä's marine engines
Ship Power Market Market position of Wärtsilä’s marine engines Medium-speed main engines Low-speed main engines Auxiliary engines Mitsubishi Wärtsilä 1%(2) 4%(4) Wärtsilä Others 14%(15) 25%(29) Wärtsilä 47%(48) MAN D&T Others 18%(19) Caterpillar MAN D&T 96%(96) 10%(4) 85%(83) Total market volume las
Slide 22: Stable development in service markets
Stable development in service markets
Slide 23: Services net sales development
Services net sales development MEUR 2000 1800 0% 0% 5% Second quarter development 1600 MEUR 1400 600 4% 1200 449 465 500 1000 400 800 300 600 200 400 200 100 0 0 2009 2010 2011 2012 1-6/2013 Q2/2012 Q2/2013 23 © Wärtsilä
Slide 24: Services net sales by quarter
Services net sales by quarter MEUR 600 500 400 300 200 100 0 2006 2007 2008 2009 2010 2011 2012 2013 Q1 Q2 Q3 Q4 24 © Wärtsilä
Slide 25: Services net sales distribution 1-6/2013
Services net sales distribution 1-6/2013 Field service 23%(24) Spare parts 53%(53) Contracts 16%(14) Projects 8%(9) Total EUR 899 million (942) 25 © Wärtsilä
Slide 26: Good demand for service agreements in Africa
Good demand for service agreements in Africa • 3-year O&M agreement signed with Central Termica de Ressano Garcia for the company’s gas engine power plant in Mozambique – The power plant will help meet the country’s growing demand for electricity • 10-year O&M agreement signed with Ndola Energy Comp
Slide 27: Development of Power Plants service agreements
Development of Power Plants service agreements MW 4500 90% 4000 80% 3500 70% 57% 58% 57% 3000 60% 53% 48% 2500 50% 2000 40% 1500 30% 1000 20% 500 10% 0 0% 2009 2010 2011 2012 Q2/2013 12m rolling O&M and maintenance agreements Power Plants deliveries % of delivered MWs 27 © Wärtsilä
Slide 28: Fleet utilisation
Fleet utilisation Fleet utilisation Anchored Vessels & Fleet Development* 35% 22000 Nr of Active Vessels Percent Anchored 30% 21500 25% 21000 20% 20500 15% 20000 Oct.11 Oct.12 Jan.11 Jan.12 Jan.13 Jul.11 Jul.12 Jul.13 Apr.11 Apr.12 Apr.13 Anchored Active Fleet Fleet Average Speed, knots** 10,5 10,0
Slide 29: Cash flow from operating activities
Cash flow from operating activities MEUR 700 600 500 400 300 200 100 0 2009 2010 2011 2012 1-6/2013 29 © Wärtsilä
Slide 30: Net working capital development
Net working capital development Good development in advances received MEUR 2000 25% 1800 1600 20% 1400 1200 15% 1000 10.9%* 9.8% 800 9.2% 10% 600 6.8% 5.8% 486 508 465 400 5% 267 3.7% 235 200 118 0 0% 2008 2009 2010 2011 2012 30.6.2013 Net working capital Total inventories Advances received Net work
Slide 31: Committed loans June 2013
Committed loans 30 June 2013 Financial freedom is maintained MEUR 1800 1600 1400 529 1200 1000 Total 150 EUR 889 800 million 254 drawn 600 87 400 549 200 0 Drawn long- Current portion of Drawn short- Undrawn long Undrawn term loans long-term loans term loans term loans revolving credits At the end o
Slide 32: Continuous focus on R&D
Continuous focus on R&D WÄRTSILÄ’S R&D EXPENSES MEUR % of net sales 200 4,5% • 10-year loan totalling EUR 150 4,0% million granted by the European Investment Bank in June 3,5% 150 • The loan will fund R&D and 3,0% innovation activities in several 2,5% European countries 100 2,0% • Wärtsilä’s R&D act
Slide 33: Financial position
Financial position Solvency Gearing 50% 0,50 45% 0,40 40% 35% 0,30 30% 25% 0,20 20% 15% 0,10 10% 0,00 5% 0% 2009 2010 2011 2012 30.6.2013 -0,10 2009 2010 2011 2012 30.6.2013 33 © Wärtsilä
Slide 34: Market outlook
Market outlook • Power Plants: The overall market for natural gas and liquid fuel based power generation in 2013 is expected to be similar to that of 2012. NEW • PIC Ship Power: The outlook for the shipping and ship building market in 2013 is cautious, although market conditions are expected to be b
Slide 35: Prospects for 2013 unchanged
Prospects for 2013 unchanged Wärtsilä expects its net sales for 2013 to grow by 0-10% and its operational profitability (EBIT% before non-recurring items) to be around 11%.
Slide 36: IR Contact
IR Contact: Natalia Valtasaari Director, Investor Relations Tel. +358 (0) 40 187 7809 E-mail: natalia.valtasaari@wartsila.com