Metso Corporation · OMXHEX:METSO
Metso — Investor Day (September 2015)
31 slides from Metso's investor day presentation, Sep 29, 2015
Slide 1: On our way to improving profitability
On our way to improving profitability João Ney Colagrossi President, Minerals business area © Metso Capital Markets Day 2015
Slide 2: We are on our way to improving profitability
We are on our way to improving profitability • Minerals has a • Short-term market • We have been • Our strategy is strong market outlook challenging adjusting ourselves to grow and position in our three in Mining and to the new market improve customer industries: Recycling environment profitability
Slide 3: A competitive leader with a strong market position
A competitive leader with a strong market position Mining • Comminution equipment • Process equipment • Bulk material handling #1 • Pyro processing In mining crushers • Mining systems and grinding mills Aggregates • Stationary crushers • Stationary screens • Mobile crushers and screens #1 In aggrega
Slide 4: We serve mining, aggregates and recycling customer industries globally
We serve mining, aggregates and recycling customer industries globally Net sales rolling 12 months (Q3 2014 – Q2 2015): EUR 1,057 million Personnel: ~3,300 Sales by segment Sales by application Sales by offering Sales by region 11 % 11 % 14 % 20 % 25 % 31 % 49 % 12 % 23 % 40 % 40 % 4% 75 % 11 % 13 %
Slide 5: We are maintaining margins in tough markets
We are maintaining margins in tough markets Metso Minerals BA net sales and GP index Key takeaways EUR million 2 500 120 • Downturn has hit hard on volumes - Mining business hardest hit 2 000 100 - Recycling following iron ore 80 - Developed & emerging markets 1 500 changing roles in aggregates 60 1
Slide 6: Our businesses are synergistic
Our businesses are synergistic Synergies Aggregates • Common supply chain with no/light assets Mining • Common crushing and screening technologies • Common engineering and project capabilities • Common global footprint and structures Recycling We support Services and Services supports us 6 © Metso M
Slide 7: Key takeaway #1: We are strong
Key takeaway # 1: We are strong • We have a strong market position in our three customer industries • Our businesses are synergistic • We have an unbeatable presence at the customer sites through services • We are maintaining margins in tough markets 7 © Metso Minerals by João Ney Colagrossi Capital
Slide 8: Mining: Demand affected by the slowdown of the biggest commodity consumer - China
Mining: Demand affected by the slowdown of the biggest commodity consumer - China China’s share of world commodity consumption China’s real GDP growth 2004 - 2020F 15% Aluminium 54% 100% y-o-y % 14% 13% Nickel 50% 100% 12% 11% Copper 48% 100% 10% 9% Zinc 46% 100% 8% 7% Steel 45% 100% 6% 5% Gold 23%
Slide 9: Mining: Capex market still going down but... copper and gold have strong long-term outlook
Mining: Capex market still going down but... copper and gold have strong long-term outlook Top 10 miners’ capex and guidance (bn USD) Long-term capex outlook • Overall, more maintenance capex 100 and less project capex 88 90 84 • Copper and base metals with 80 strong outlook driven by 70 71 70 65 co
Slide 10: Aggregates: Global growth opportunities despite flat development
Aggregates: Global growth opportunities despite flat development Construction market outlook Key takeaways • Short-term outlook best in North America and Europe • Long-term outlook best in China, India and North America • Mid-market approach becoming more important as demand arises more Total global
Slide 11: Recycling: Short-term challenges due to low scrap prices, long-term depends on China
Recycling: Short-term challenges due to low scrap prices, long-term depends on China Scrap and iron ore prices Forecast metal scrap recovery EUR/tonne tonne 800 1 000 000 700 900 000 600 800 000 700 000 500 600 000 400 500 000 300 400 000 300 000 200 200 000 100 100 000 0 0 2008 2009 2010 2011 2012
Slide 12: Short-term equipment outlook flat, long-term equipment outlook more positive in all segments
Short-term equipment outlook flat, long-term equipment outlook more positive in all segments LTM Production growth* Equipment outlook Comments mix 2008-14 2015-20 2015-16 2017-20 • Short term flat due to cooling down in China, APAC and Latin America Aggregates 40% 3-4% 4-5% • Long term driven by Chi
Slide 13: Key takeaway #2: Market is challenging
Key takeaway # 2: Market is challenging • Short-term market outlook challenging in Mining and Recycling • More positive market outlook for Aggregates • Solid long-term fundamentals in all segments 13 © Metso Minerals by João Ney Colagrossi Capital Markets Day 2015
Slide 14: Our strategy will enable us to improve profitability despite market conditions
Our strategy will enable us to improve profitability despite market conditions • Right-sizing our cost base to current market activity Operating • Making Minerals simpler, lighter and much more efficient model • Making Minerals more market-driven and less product-driven Market • Taking our existing
Slide 15: We have solid achievements and priorities
We have solid achievements and priorities 2014 - 2015 Achievements Current priorities ✓ Right-sizing to market activity • Finalize asset-light supply chain for aggregates ✓ Systems business re-focused • Recycling business turnaround Operating ✓ No-asset supply chain for • Streamline of customer-faci
Slide 16: We have solid achievements and priorities
We have solid achievements and priorities 2014 - 2015 Achievements Current priorities ✓ Mid-market business growth in • Expand mid-market business China • Grow in adjacent markets: Market ✓ Africa and Oceania coverage Coal, Fertilizer and Cement Expansion ✓ Key account management • Manage global dis
Slide 17: We have solid achievements and priorities
We have solid achievements and priorities 2014 - 2015 Achievements Current priorities ✓Hydraulic roll crusher range • Advanced classification solutions ✓Vertical grinding mill range • Next-generation crusher models Portfolio • Complete in-the-pit solutions Development ✓Next generation Lokotracks • D
Slide 18: Supply chain is significantly more agile and light
Supply chain is significantly more agile and light EUR 30M assets reduction, EUR 45M annual savings Recycling supply chain Mining supply chain Aggregates supply chain Component Component Component Outsourced Outsourced Outsourced fabrication fabrication fabrication Component Component Component Outs
Slide 19: Continuously sizing ourselves to market activity
Continuously sizing ourselves to market activity # Minerals employees 8 000 7 000 6 000 4,888 5 000 4 572 4 360 4,062 3,916 4 000 3,626 3,442 3,357 3,254 3 000 3 475 3 293 3 120 2 828 2 725 2 494 2 339 2 282 2,204 2 000 1 000 1 413 1 279 1 240 1 234 1 191 1 132 1 103 1 075 1,050 0 2013 Dec 2014 Mar
Slide 20: We are addressing new markets, leveraging our existing products for adjacent growth
We are addressing new markets, leveraging our existing products for adjacent growth Potash and phosphates Cement Coal Full-scope portfolio ranging Solutions for limestone quarries, Modular coal washeries from comminution to fly-ash handling and ready mix supported with other products beneficiation 2
Slide 21: We are expanding our existing products for adjacent growth and competitiveness
We are expanding our existing products for adjacent growth and competitiveness Open-pit mining Comminution Beneficiation Complete in-the-pit solutions Next generation crusher models New ultra-fine screens and to expand our offering further to improve our competitiveness in hydro cyclones to expand o
Slide 22: We are expanding our mid-market business
We are expanding our mid-market business Global aggregates equipment market Key takeaways • 50+ % market captured by ~6 globally operating Metso OEMs, while remaining 40-50% is shared by 21% mostly local mid-market players All others 40 % • Mid-market segment growing faster than high-end Mostly loca
Slide 23: We are responding to the demand for new remote services with a new digital platform
We are responding to the demand for new remote services with a new digital platform Connected Equipment Data New Remote Services Remote … • Parts Scheduling • Preventative Maintenance • Expert Support • Alarms & Reports • Status & Performance • Process Optimization Metso New Digital Platform Interne
Slide 24: Key takeaway #3: We have a solid strategy
Key takeaway # 3: We have a solid strategy • We are adjusting ourselves to the new market environment • Our strategy will enable us to grow and improve profitability despite market conditions: - Implementing an agile and customer centric operating model - Expanding our offering to adjacent markets -
Slide 25: We are on our way to improving profitability
We are on our way to improving profitability • Minerals has a strong • Short-term market • We have been • Our strategy is to market position in outlook challenging adjusting ourselves grow and improve our three customer in Mining and to the new market profitability industries: Mining, Recycling envi
Slide 26: © Metso Capital Markets Day 2015
© Metso Capital Markets Day 2015
Slide 27: Appendix
Metso Capital Markets Day 2015 September 29, London Making the big difference to our customers Appendix
Slide 28: Our product and systems offering for Mining customers
Our product and systems offering for Mining customers Grinding mills Mining crushers Process equipment Bulk material handling Pyro processing Mining systems 28 © Metso Minerals by João Ney Colagrossi Capital Markets Day 2015
Slide 29: Our product and systems offering for Aggregates customers
Our product and systems offering for Aggregates customers Crushers Screens and feeders Lokotracks Portable plants Mid-market products Aggregates systems 29 © Metso Minerals by João Ney Colagrossi Capital Markets Day 2015
Slide 30: Our product, systems and services offering for Recycling customers
Our product, systems and services offering for Recycling customers Metal shredders Metal shears Metal balers Texas Shredder Lindemann Lindemann shredder shear baler Waste recycling Recycling services Recycling systems M&J waste pic 30 © Metso Minerals by João Ney Colagrossi Capital Markets Day 2015
Slide 31: Case: An integrated solution for Centinela mine
Case: An integrated solution for Centinela mine Challenge Metso Solution Results • AMSA’s Centinela Mine in Chile was • An integrated solution covering • The solution has proven to be not reaching its designed plant process studies, engineering, successful in production capacity equipment, and plant