Alfa Laval AB · OMXSTO:ALFA

Alfa Laval AB — Q1 2020 Earnings Presentation

29 slides from Alfa Laval AB's earnings presentation, Apr 23, 2020

  1. Slide 1: www.alfalaval.com

    www.alfalaval.com

  2. Slide 2: Report for Q1 2020

    Change UPDATE Picture picture Tom Erixon President and CEO Report for Q1 2020 Alfa Laval Group 23/04/2020 | © Alfa Laval 2 | www.alfalaval.com

  3. Slide 3: Key figures

    Key figures Q1 2020 Q1 2019 %-change %-▲,org* Order intake 11,877 12,213 -3 -2 Net sales 10,590 10,158 4 5 Adjusted EBITA** 1,750 1,728 1 Adjusted EBITA-margin (%) 16.5 17.0 *) Organic growth excluding currency effects and structural changes. SEK 769 (-83) million of the order intake in the quarter

  4. Slide 4: Orders received

    Orders received SEK million SEK million R 12 14 000 49 000 12 000 42 000 10 000 35 000 8 000 28 000 6 000 21 000 +14% +22% +14% -22% -3% 4 000 14 000 2 000 7 000 0 0 Q116 Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120 = Order intake per quarter “large” = Rolling twel

  5. Slide 5: Orders received

    Orders received − Orders received excluding the “Marine Environmental”* business SEK million SEK million R 12 14 000 49 000 12 000 42 000 10 000 35 000 8 000 28 000 6 000 21 000 +11% -21% -12% +4% +8% 4 000 14 000 2 000 7 000 0 0 Q116 Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219

  6. Slide 6: Service, by division

    Service, by division − Order intake Q1, share and development ENERGY FOOD & WATER MARINE Q120: 27% Q120: 33% Q120: 27% Absolute development Absolute development Absolute development + + + YoY YoY YoY = Service share of total order intake 23/04/2020 | © Alfa Laval 6 | www.alfalaval.com

  7. Slide 7: Orders received by region

    Orders received by region − January – March 2020 & development Q1-20 vs. Q1-19 at constant rates 2%; -37% Africa & Oceania 8%; Nordic +33% 17%; -24% North America -5% 4%; +9% Latin America 20%; Western Europe +67% 7%; Central- & Eastern +18% Europe 42%; Asia January – March 2020 vs Q1 2019 23/04/202

  8. Slide 8: Top ten markets

    Top ten markets* − SEK million at prevailing rates United States China Nordic Korea, South Adriatic Mid Europe South East Asia Japan Benelux France 0 1 000 2 000 3 000 4 000 5 000 6 000 7 000 8 000 = LTM 2020 = FY 2019 *The order intake development of the 2019 top ten markets. 23/04/2020 | © Alfa La

  9. Slide 9: Adjusted EBITA/margin

    Adjusted EBITA/margin* − SEK millions and in percent of sales SEK million Percent of sales 2 500 20,0 2 250 19,0 2 000 18,0 16.9 17.0 16.5 1 750 17,0 1 500 15.7 16,0 1 250 15,0 1 000 14,0 750 13,0 500 12,0 250 11,0 0 10,0 Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120 * Adjusted EB

  10. Slide 10: Energy division

    Energy division − Highlights and comments MARKETS & ORDER INTAKE Q1 20 Q1 19 YoY %- Q4 19 change • Investment activity in the hydrocarbon chain negatively impacted by current market turmoil. ORDERS 3,197 3,448 -7.3 3,594 • Demand in HVAC and refrigeration continued on a SALES 3,039 2,807 +8.3 3,961

  11. Slide 11: Food & Water division

    Food & Water division − Highlights and comments MARKETS & ORDER INTAKE Q1 20 Q1 19 YoY %- Q4 19 change • Overall demand remained stable on a high level. ORDERS 3,612 3,480 +3.8 3,720 • Strong demand from customers in the dairy and biotech segments. SALES 3,118 3,153 -1.1 3,938 • Service developed we

  12. Slide 12: Marine division

    Marine division − Highlights and comments MARKETS & ORDER INTAKE Q1 20 Q1 19 YoY %- Q4 19 change • Demand in BU Pumping systems was solid both for cargo pumping and offshore. ORDERS 5,068 4,963 +2.1 3,840 • Demand for PureBallast systems continued on a high SALES 4,433 3,932 +12.7 5,017 level, while

  13. Slide 13: Report for Q1 2020

    Report for Q1 2020 Jan Allde CFO Alfa Laval Group | © Alfa Laval | www.alfalaval.com

  14. Slide 14: Sales

    Sales − MSEK SEK million SEK million R 12 14 000 49 000 12 000 42 000 10,590 10 000 35 000 8 000 28 000 6 000 21 000 +15% -10% +4% +9% -1% 4 000 14 000 2 000 7 000 0 0 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 = Sales per quarter = Rolling

  15. Slide 15: Adjusted gross margin

    Adjusted gross margin − In percent of sales 45 Q1 2019 38.0 Mix/price - 40 Load/volume = 38.3 38.0 PPV/metals + 37.1 37.6 FX - 35 Structure = Q1 2020 37.6 30 Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120 23/04/2020 | © Alfa Laval 15 | www.alfalaval.com

  16. Slide 16: Divisional sales and profitability

    Divisional sales and profitability − MSEK ENERGY FOOD & WATER MARINE Q1 2020 2019 2020 2019 2020 2019 Sales 3,039 2,807 3,118 3,153 4,433 3,932 Op. profit 488 399 498 524 708 761 Op. margin, % 16.1 14.2 16.0 16.6 16.0 19.4 Op. Margin (%) comments • Volume and factory • Volume and factory • Volume an

  17. Slide 17: Key figures

    Key figures − MSEK Q1 2020 Q1 2019 Sales 10,590 10,158 Gross profit 3,763 3,604 Sales & Admin -1,670 -1,669 R&D -286 -260 Net other cost/income -291 -212 Operating income 1,528 1,471 Financial net -142 151 Profit before tax 1,386 1,622 Taxes -362 -397 EPS 2.43 2.90 23/04/2020 | © Alfa Laval 17 | www

  18. Slide 18: Cash-flow statement

    Cash-flow statement − MSEK Q1 Q1 2020 2019 Cash flow from - operating activities 959 975 - investing activities -83 -494 Financial net paid -347 167 Total 529 648 Pro Forma Free cash-flow* 405 708 *Incl. operating activities, capital expenditure and financial net paid. 23/04/2020 | © Alfa Laval 18 |

  19. Slide 19: Foreign exchange

    Foreign exchange − Estimated impact on adjusted EBITA from FX fluctuations, MSEK Q1 2020 FY 2020 FY 2021* Transaction effect 60 530 380 Translation effect 30 20 - Total 90 550 380 Note: Excludes FX effects caused by revaluation of balance items in foreign currency. *) Based on EUR/USD 1.118 and EUR/

  20. Slide 20: Order backlog as per March 31

    Order backlog as per March 31 − SEK billion 25.7 25 22.9 9.1 20 7.4 15 15.5 16.6 10 5 0 1.20 0.88 0.89 0.86 1.12 book to bill Q116 Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120 = For delivery during the current year = For delivery next year or later 23/04/2020 | © A

  21. Slide 21: Sales

    Sales − FY 2020, SEK billion Q1 Sales 10.6 Backlog, for delivery current year +15.5 Subtotal 26.1 For you to consider: Price “In-for-out”* FX translation Acquisitions Full year 2020 *IFO in Q2-Q4 2019 excluding acquisitions/divestments was SEK 20.0 bln. 23/04/2020 | © Alfa Laval 21 | www.alfalaval.c

  22. Slide 22: Outlook for the second quarter

    Outlook for the second quarter: “We expect demand in the second quarter to be lower than in the first quarter.” 23/04/2020 | © Alfa Laval 22 | www.alfalaval.com

  23. Slide 23: www.alfalaval.com

    www.alfalaval.com

  24. Slide 24: Activity split O&G, total

    Activity split O&G, total − Distribution of orders Q1 2020 (MSEK) Drilling Processing & Refinery Petrochemicals Transportation (SEQ/YoY) Grand total SEQ/YOY Energy 38 336 196 390 960 (-/-) Marine 399 336 0 0 735 (+/+) Alfa Laval = 437 = 672 = 196 = 390 =1,695*(-/-) Share of total Alfa Laval 3.7% 5.7

  25. Slide 25: Marine Division's industry split

    Marine Division’s industry split − Distribution of orders LTM, end of March Marine Offshore oil Environment & Engine power Service and gas Energy, Marine World trade & Oil & gas demand Legislation & Electrical power World trade Driver fleet capacity and prices fuel cost needs 30% 33% Share 7% 4% 26%

  26. Slide 26: Marine Division's industry split

    Marine Division’s industry split − Distribution of sales LTM end of March Marine Offshore oil Environment & Engine power Service and gas Energy, Marine World trade & Oil & gas demand Legislation & Electrical power World trade Driver fleet capacity and prices fuel cost needs 26% 28% Share 4% 7% 35% 2

  27. Slide 27: Organic growth pace

    Organic growth pace − Compared with same quarter last year (%), excluding currency effects 30 20 10 0 (10) (20) (30) Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120 = Order intake growth 23/04/2020 | © Alfa Laval 27 | www.alfalaval.com

  28. Slide 28: Cautionary statement

    Cautionary statement This presentation contains forward-looking statements that are based on the current expectations of the management of Alfa Laval Group. Although management believes that the expectations reflected in such forward- looking statements are based on reasonable assumptions, no assura

  29. Slide 29: www.alfalaval.com

    www.alfalaval.com

Alfa Laval — Q1 2020 Earnings Presentation on 6ix