Wartsila Oyj Abp · OMXHEX:WRT1V
Wartsila Oyj Abp — Wärtsilä — Investor Day (November 2021)
15 slides from Wartsila Oyj Abp's investor day presentation, Nov 18, 2021
Slide 1: Strong commitment to reach our financial targets
Strong commitment to reach our financial targets Arjen Berends, CFO & Executive Vice President November 18, 2021 1 © Wärtsilä
Slide 2: Set to deliver long term shareholder value
Set to deliver long term shareholder value We have clear Our balance sheet We have clear financial targets and financing capital allocation and are committed structure supports principles to realising them strategy execution 2 © Wärtsilä
Slide 3: Moving in the right direction – Transform and Perform
Moving in the right direction – Transform and Perform Historical reflections Transform and Perform ▪ Financial targets ▪ Improved project execution - Gearing and dividend distribution targets met - Significant changes in leadership and processes implemented since 2019 - Growth and profitability targ
Slide 4: COVID-19 will be with us for quite some time to come
COVID-19 will be with us for quite some time to come. Energy core markets will be affected the longest with a high number of COVID-19 cases and low vaccination levels Daily new confirmed COVID-19 cases per million people Share of people vaccinated against Covid-19 October 31, 2021 1) October 31, 202
Slide 5: We will continue to take actions to address our cost structure
We will continue to take actions to address our cost structure whenever and wherever necessary ▪ Temporary savings programme during COVID-19 peak times Capacity ▪ Continuous resource optimisation efforts (temporary and permanent) adjustments ▪ Further outsourcing of activities ▪ Reduction of office
Slide 6: Strong cashflow driven by solid working capital efficiency programme
Strong cashflow driven by solid working capital efficiency programme. Working capital improved beyond volume fluctuations Working capital (MEUR) Cash flow from operating activities (MEUR) Key drivers Working capital % of sales Cash flow from operating activities % of sales ▪ New approach to receivab
Slide 7: Strong financial position and liquidity
Strength to make strategic investments and to support our capital allocation principles. Strong financial position and liquidity Net debt and gearing (MEUR) Solvency ratio Net debt Gearing-% Net debt Solvency ratio 800 35% 800 60% 30% 700 30% 700 48% 46% 50% 44% 600 600 41% 25% 38% 39% 500 40% 18% 5
Slide 8: Clear capital allocation principles
Clear capital allocation principles – Setting the right priorities and securing attractive shareholder returns Continuing R&D investments to support growth opportunities M&A to support strategy Profit distribution ▪ Strong track record in ▪ Focus on synergistic bolt-on ▪ Dividend distribution accord
Slide 9: Committed to providing shareholder returns
Committed to providing shareholder returns Target: dividend of at least 50% of earnings 73%1) 71% 74% 131% 88% EUR 0.70 0.70 0.60 0.60 0.50 0.50 0.40 0.40 0.30 0.30 0.20 0.20 0.10 0.10 0.00 0.00 2016 2017 2018 2019 2020 EPS DPS 1) Dividend per earnings 9 © Wärtsilä
Slide 10: New financial targets reflect growth opportunities and increased profitability
New financial targets reflect growth opportunities and increased profitability New targets Net sales 5% annual organic growth Profitability 12% operating margin Capital structure Gearing below 0.50 Dividend At least 50% of earnings 10 © Wärtsilä
Slide 11: Good growth opportunities in services, energy, and marine new build recovery
Good growth opportunities in services, energy, and marine new build recovery. Our installed base provides a strong foundation for services growth Key drivers Storage ▪ Fast growing demand for energy storage and power system optimisation solutions Services ▪ Increased share of wallet from existing cu
Slide 12: We will reach our profitability target while maintaining R&D investments
We will reach our profitability target while maintaining R&D investments at ~3% of net sales Key drivers ▪ Marine and Energy Services growth ▪ Thermal balancing power growth ▪ Storage growth Starting point: Target: Operating margin 5.9% ▪ Voyage turnaround and digital growth 12% operating margin (LT
Slide 13: Set to deliver long term shareholder value
Set to deliver long term shareholder value 13 © Wärtsilä
Slide 14: Disclaimer
Disclaimer The information and conclusions in this presentation are based upon calculations, observations, assumptions, publicly available competitor information, and other information obtained by Wärtsilä or provided to Wärtsilä by its customers, prospective customers or other third parties (the ”i
Slide 15: Wärtsilä
e, WARTSILA