Alfa Laval Ab · OMXSTO:ALFA
Alfa Laval Ab — Q4 2015 Earnings Presentation
40 slides from Alfa Laval Ab's earnings presentation, February 2016
Slide 1: NOES
NOES
Slide 2: Report for Q4 2015
Report for Q4 2015 - Key figures - Orders received and margins - Highlights - Development per segment - Geographical development - Financials Mr. Lars Renström - Outlook President and CEO Alfa Laval Group
Slide 3: Key figures
Key figures October – December 2015 Orders received declined 10% to SEK 9,422 million. Net sales unchanged at SEK 10,805 million. Adjusted EBITA dropped 10% to SEK 1,751 million. Adjusted EBITA margin 16.2% vs 18.0% - Positive currency effect SEK 80 million. January – December 2015 Orders
Slide 4: Board proposal to the AGM
Board proposal to the AGM Dividend The board of directors proposes a dividend of SEK 4.25 (4.00) © Alfa Laval Slide 4 www.alfalaval.com
Slide 5: Report for Q4 2015
Report for Q4 2015 - Key figures - Orders received and margins - Highlights - Development per segment - Geographical development - Financials - Outlook
Slide 6: Orders received
Orders received SEK million SEK million R 12 12 000 45000 40000 10 000 35000 8 000 30000 25000 6 000 20000 +16% +22% +11% 4 000 15000 -11% +8% 10000 2 000 5000 0 0 Q312 Q213 Q313 Q413 Q214 Q314 Q414 Q215 Q212 Q412 Q315 Q415 Q112 Q113 Q114 Q115 Q411 = Order intake per quarter “large” = Rolling twelve
Slide 7: Order analysis
Order analysis Q4 2015 versus Q4 2014 and versus Q3 2015 (MSEK) Q4 2014 10,509 Q3 2015 8,686 Structural change, % + 0.1 - Organic development, % - 11.1 + 10.9 Total - 11.0 + 10.9 Currency effects,% + 0.7 - 2.4 Total, % - 10.3 + 8.5 Q4 2015 9,422 Q4 2015 9,422 © Alfa Laval Slide 7 www.alfalaval.com
Slide 8: Adjusted EBITA / margin
Adjusted EBITA / margin* SEK millions and in percent of sales 2 000 24,0 1 750 21,0 1 500 18,0 1 250 15,0 1 000 12,0 750 9,0 500 6,0 250 3,0 0 0,0 Q412 Q113 Q213 Q313 Q413 Q114 Q214 Q314 Q414 Q115 Q215 Q315 Q415 * Adjusted EBITA – ”Earnings before interests, taxes, amortization of goodwill and step
Slide 9: Report for Q4 2015
Report for Q4 2015 - Key figures - Orders received and margins - Highlights - Development per segment - Geographical development - Financials - Outlook
Slide 10: Highlights in the quarter
Highlights in the quarter Process Technology Marine & Diesel Complete process line for a vegetable protein Alfa Laval Framo power generator systems for an oil extraction plant in India. Value: SEK 50 million. platform in the North Sea. Value: SEK 100 million. Order for air heat exchangers to refiner
Slide 11: Report for Q4 2015
Report for Q4 2015 - Key figures - Orders received and margins - Development per segment - Geographical development - Financials - Outlook
Slide 12: Orders received by customer segment
Orders received by customer segment Oct – December 2015, at constant rates and like for like PTD Service = - Industrial Equipment Water & Waste + = Sanitary Equipment = OEM Food & Life Science + = EQD Service Energy & Process - - Marine & Diesel Eq. - Marine & Offshore Syst. MDD Service - Marine & O
Slide 13: Equipment division
Equipment division Highlights and sequential comments Industrial Industrial Equipment was negatively affected by Equipment 8%* Russia as well as the transfer from direct to channel sales. Refrigeration saw good demand. - - Sanitary saw good order growth from customers Sanitary 10% in both food a
Slide 14: Marine & Diesel division
Marine & Diesel division Highlights and sequential comments Marine & Diesel M&D Equipment affected by lower ship contracting Equipment earlier in the year. Decline partly compensated by 6%* increase for diesel power. Marine & Offshore saw higher marine demand while - - Marine & offshore dropped
Slide 15: Process Technology division
Process Technology division Highlights and sequential comments Energy & Energy & Process affected by oil & gas sentiment. Process 9%* Cancellations also had negative impact. Petrochemicals was unchanged. - - Food & LS reported strong growth in protein and Food & Life brewery while vegetable oil
Slide 16: Orders received by customer segment
Orders received by customer segment January – December 2015, at constant rates and like for like PTD Service - - Industrial Equipment Water & Waste + = Sanitary Equipment Food & Life Science + = OEM Energy & Process - = EQD Service - Marine & Diesel Eq. MDD Service = - Marine & Offshore Syst. Marine
Slide 17: Report for Q4 2015
Report for Q4 2015 - Key figures - Orders received and margins - Highlights - Development per segment - Geographical development - Financials - Outlook
Slide 18: Orders received by Region
Orders received by Region October – December 2015, development at constant rates Latin America 3% +26 North America 17% -40 -17 -25 +2 Western Europe 19% Asia 46% -43 Nordic 9% Central & Eastern Europe 5% Year-on-year comparison © Alfa Laval www.alfalaval.com
Slide 19: Highlights Asia
Highlights Asia Oct. – Dec. 2015, at constant rates, sequential comments Asia: Extraordinary demand for Framo pumping systems boosted order intake in the region. The base business also grew while service was unchanged. Excluding pumping +2 +24 systems, orders were flat. Energy & Process did well
Slide 20: Highlights Europe
Highlights Europe Oct. – Dec. 2015, at constant rates, sequential comments +26 +24 -40 -11 -17 +4 Western Europe incl. Nordic: Central and Eastern Europe: Positive development for large projects Russia negatively affected by oil prices and base business alike. as well as sanctions. Poland/ Balti
Slide 21: Highlights Americas
Highlights Americas Oct. – Dec. 2015, at constant rates, sequential comments North America: Positive development driven by growth for large projects and base business in the US. Industrial Equipment, Sanitary, Food and Water & Waste all did well. Energy & Process saw a generally -25 +13 positive
Slide 22: Orders received by Region
Orders received by Region Jan. – Dec. 2015, development at constant rates Latin America 4% +26 North America 18% -18 -7 -21 +3 Asia 42% Western Europe 20% -17 Central Nordic 9% & Eastern Europe 5% Year-on-year comparison © Alfa Laval www.alfalaval.com
Slide 23: Report for Q4 2015
Report for Q4 2015 - Key figures - Orders received and margins - Highlights - Development per segment - Geographical development - Financials Mr. Thomas Thuresson - Outlook CFO Alfa Laval Group
Slide 24: Highlights
Highlights SEK millions Oct. – Dec. 2015 Order intake 9,422 Net sales 10,805 © Alfa Laval Slide 24 www.alfalaval.com
Slide 25: Gross profit margin
Gross profit margin In percent of sales 45 40 37.0 36.3 34.3 34.2 35 30 Q412 Q113 Q213 Q313 Q413 Q114 Q214 Q314 Q414 Q115 Q215 Q315 Q415 © Alfa Laval www.alfalaval.com
Slide 26: Gross profit margin
Gross profit margin Q4 2015 versus Q4 2014 and versus Q3 2015 Q4 2014 34.3 Q3 2015 35.2 Mix/price - --- Load/volume - - FX + + Structure = = Q4 2015 34.2 Q4 2015 34.2 © Alfa Laval Slide 26 www.alfalaval.com
Slide 27: Highlights
Highlights SEK millions Oct. – Dec., 2015 Order intake 9,422 Net sales 10,805 Adjusted EBITA 1,751 Adjusted EBITA-margin 16.2% Profit before tax 1,390 Earnings per share 2.22 Earnings per share, excl step-up 2.68 ROCE 21.6% ROE 21.7% © Alfa Laval Slide 27 www.alfalaval.com
Slide 28: Divisional performance
Divisional performance Equipment Process Technology Marine & Diesel Q4 2015 2014 2015 2014 2015 2014 Orders 2,526 2,523 3,089 3,928 3,807 4,058 Backlog 1,637 1,571 7,226 8,440 11,715 12,282 Sales 2,694 2,629 4,101 4,356 4,010 3,790 Op. profit 325 407 640 636 778 737 Op margin (%) 12.1 15.5 15.6 14.6
Slide 29: Cash-flow statement
Cash-flow statement Q4 Q4 FY FY SEK millions 2015 2014 2015 2014 Cash flow from - operating activities 1,875 1,690 5,850 5,123 - investing activities - 252 - 180 - 710 - 14,970 Financial net paid 56 - 320 - 323 - 433 Dividend - 1,696 - 1,578 Total 1,679 1,190 3,121 - 11,858 Pro Forma Free cash-flow*
Slide 30: Foreign exchange
Foreign exchange Estimated impact on adjusted EBITA from FX fluctuations SEK million Q4 15 FY 15 FY 16* Translation effect 34 294 -200 Transaction effect 88 298 550 Revaluation in w/c -42 -142 Total 80 450 350 *Based on EUR/USD 1.09 and EUR/SEK 9.26 Projected FX-effect for 2015 as communicated at th
Slide 31: Order backlog as per Dec. 31
Order backlog as per Dec. 31 SEK millions 25 000 22,293 20,578 5,043 20 000 4,988 15 000 10 000 17,250 15,590 5 000 book to bill 0 Q411 Q412 Q413 Q414 Q415 For delivery after 2016 For delivery in 2016 © Alfa Laval Slide 31 www.alfalaval.com
Slide 32: Sales
Sales Full year 2016 SEK (bln) FY 2015 39.7 Order backlog, like-for-like - 1.7 FX-translation - 1.2 Acquisitions + 0.0 Subtotal 36.8 Change in “in-for-out” ? Price ? Full year 2016 www.alfalaval.com
Slide 33: Report for Q4 2015
Report for Q4 2015 - Key figures - Orders received and margins - Highlights - Development per segment - Geographical development - Financials Mr. Lars Renström - Outlook President and CEO Alfa Laval Group
Slide 34: Outlook for the first quarter
Outlook for the first quarter “We expect that demand during the first quarter 2016 will be somewhat lower than in the fourth quarter, excluding a substantially lower demand for pumping systems.” © Alfa Laval Slide 34 www.alfalaval.com
Slide 35: www.alfalaval.com
© Alfa Laval Slide 35 www.alfalaval.com
Slide 36: Activity split O&G, total
Activity split O&G, total - Distribution of orders FY2015 (MSEK) vs FY2014 Drilling Processing & Refinery Petrochemicals Transportation Grand total Process 270 1 409 625 1 274 3 578 Technology Marine & 0 0 Diesel 1 346 690 2 036 Alfa Laval = 1 616 = 2 099 = 625 = 1 274 = 5 614* Share of total Alfa L
Slide 37: Industry split
Industry split - Distribution of sales LTM, December 2015 Marine Offshore oil Environment & Diesel power Parts & Service and gas Energy, Marine World trade & Oil & gas demand Legislation and Electrical power World trade Driver fleet capacity and prices fuel cost needs 27% 47% Share 4% 11% 11% © Alfa
Slide 38: Food and pharma
Food and pharma - Increased living standard, MSEK fixed rates 26% Americas Europe Asia, Pacific & Africa 2015: MSEK 9 596 3 322 2 988 3 286 2015 vs. 2014: +2% + 7% - 7% + 6% www.alfalaval.com
Slide 39: Top 10 markets
Top 10 markets* SEK million at prevailing rates United States China South Korea Nordic Mid Europe Japan SEA Adriatic Benelux UK 0 1 000 2 000 3 000 4 000 5 000 6 000 = WY 2015 *The development of the 2014 top ten markets. = WY 2014 © Alfa Laval Slide 39 www.alfalaval.com
Slide 40: 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