Metso Corporation · OMXHEX:METSO
Metso — Metso Outotec — Investor Presentation (March 2023)
66 slides from Metso's investor presentation, March 2023
Slide 1: Investor presentation March 2023
Investor presentation March 2023
Slide 2: Forward looking statements
Forward looking statements It should be noted that certain statements herein which are not historical facts, including, without limitation, those regarding expectations for general economic development and the market situation, expectations for customer industry profitability and investment willingn
Slide 3: Metso Outotec – Enabling sustainable modern life
Metso Outotec – Enabling sustainable modern life Megatrends Vision Top priorities Urbanization To be customers’ number one choice for sustainable Financial performance Electrification use of Earth’s natural resources. Together we deliver Customer success Sustainability service, reliability, innovati
Slide 4: Enabling sustainable modern life
Enabling sustainable modern life 5.3 45+ VISION: To be customers’ number one billion euro countries we choice for sustainable use of sales in 2022 operate in Earth’s natural resources. Together we deliver service, reliability, innovation and results – safely. 16,000+ 90+ employees nationalities 30 l
Slide 5: Our businesses
Our businesses Aggregates Minerals Metals Services Consumables Crushing and Equipment, process Process Spare parts, Comprehensive screening equipment islands, and plants for technologies, refurbishments and offering of wear for the production of minerals processing solutions, and professional servic
Slide 6: We will deliver shareholder value through various means
We will deliver shareholder value through various means Growth Delivery of synergies Reducing volatility Improving profitability Offering competitive Strengthening of dividend balance sheet 6
Slide 7: Metso Outotec investment highlights
Metso Outotec investment highlights Leading offering in Committed to aggregates and Industry leader in Strong aftermarket further mining with full sustainability and presence & improvement of flowsheet technology capability profitability 7
Slide 8: Metso Outotec key financials 2022
Metso Outotec key financials 2022 Sales Sales by segment Sales by geography EUR 5.3 billion 9% Aggregates 15% Europe 27% Minerals 23% North and Central Metals America 17% Asia Pacific Planet Positive sales South America 23% and Africa EUR 1,338 64% 22% Middle-East and India million Services share of
Slide 9: Strategy implementation via TOP Priorities
Performance culture Financial performance Progress: 70 % Progress: 60 % Strategy implementation via TOP Priorities Tier-1 company Sustainability Customer success Progress: 80 % Progress: 50 % 9
Slide 10: Meeting our financial targets
Meeting our financial targets Q4/22: Baa2/ 14.8% BBB- Adjusted EBITA Maintaining margin of investment- >15% grade credit over the cycle rating 2021: On 68% track Dividend payout of Progress in sustainability at least in alignment with the 50% 1.5°C of earnings per share commitment 10
Slide 11: Emphasizing services and product development
Emphasizing services and product development CONTINUOUSLY FOCUS ON PRODUCT GROW SERVICES DEVELOPMENT • Reinforce presence in Insert Background Picture • Building on our end-to- service-intensive Forend process best knowledge result, use businesses an image that is 16:9 • Standardized and pre- • Prof
Slide 12: Broad range of sustainability initiatives
Broad range of sustainability initiatives EQUIPMENT AFTERMARKET CAPABILITIES • Planet Positive products • Recycling of consumables • Industry-leading metallurgical expertise Examples: Concorde Cell, • Significant increase of product Geminex and digital, hydro, lifetime • Supply chain battery chemica
Slide 13: Digitalization drives growth and aftermarket captivity
Digitalization drives growth and aftermarket captivity Focusing on Enabling creating Digital and Growth of automation Higher equipment and technologies customer aftermarket and value business capabilities Customer segment specific offerings Intelligent Fleet Process & operations equipment management
Slide 14: Action taken in Metals & Recycling
Action taken in Metals & Recycling • Metals strategic review expected to complete in Q1/23 • Hydrometallurgy moved to Minerals • Waste Recycling business divestment completed in Dec 2021 • Metals Recycling business divestment completed in June 2022 14
Slide 15: Aggregates market driven by the US
Aggregates market driven by the US Crushed stone price and production Aggregates capex expectations US production - 12m rolling (Mt) Japan price (index 2020=100) US price (index 2020=100) India price (index 2020=100) Index Mt 120 1 650 MEUR 115 1 500 12 000 +4% 110 1 350 10 000 +28% 8 000 105 1 200
Slide 16: Market outlook for key commodities remains healthy
Market outlook for key commodities remains healthy COMMODITY SUPPLY AND DEMAND PRICE DEVELOPMENT Mined Copper Supply LTM US$/t 12 000 Mined Copper Demand Mt Latest 4% Forecast 10 000 07/2022 24 8 000 4% Previous COPPER 22 Forecast 6 000 20 05/2022 4 000 18 2 000 16 0 2021 2022 2023 2024 2025 2026 20
Slide 17: Demand forecast for battery metals remains robust
Demand forecast for battery metals remains robust COMMODITY SUPPLY AND DEMAND EV BY UNIT SALES (M) Refined supply including secondary Penetration rate fct 05/22 (%) 350 kt Penetration rate fct 07/22 (%) Refined consumption +11% 300 +10% 250 EV share in total car sales, % (lhs) mn EV vehicles sold (r
Slide 18: Focus areas for acquired growth
Focus areas for acquired growth Products with Sustainable high aftermarket offering intensity Automation & Supply chain digitalization competitiveness 18
Slide 19: Building an industry leader
Building an industry leader Strong platform Leading position to grow and in technology and create value sustainability Business model Self-help reducing volatility improving profitability 19
Slide 20: Sustainability, R&D and people
Sustainability, R&D and people
Slide 21: Mining industry and equipment suppliers play an important role in addressing the climate challenge
Mining industry and equipment suppliers play an important role in addressing the climate challenge About 3-5% of the world's energy consumption is used in comminution Around 1% of the worlds power • We must improve our sustainability performance throughout the value chain. runs through our • Our cus
Slide 22: We have ambitious goals that target limiting global warming to 1.5 degrees
We have ambitious goals that target limiting global warming to 1.5 degrees We are committed to Science-Based Targets • CDP ratings: A - for climate change leadership, B - for tackling water security • CDP Supplier Engagement Leaderboard 22
Slide 23: Helping our customers to solve their sustainability challenges
Helping our customers to solve their sustainability challenges Climate change Planet Positive offering Water Footprint Net zero by 2030 Circular economy Integrated Policies and in strategy regulations 23
Slide 24: Our handprint is significantly bigger than our footprint
Our handprint is significantly bigger than our footprint CO2 Handprint** in 2021 CO2 Footprint* in 2021 10.3 million <1 million tonnes tonnes *Footprint = emissions generated in production, logistics, **Handprint = emissions avoided in customer operations across purchased goods and services as well
Slide 25: Our environmental footprint
Our environmental footprint We aim to minimize our footprint by reducing environmental impact in our own operations, logistics and procurement. CO2 emissions in own Logistics CO2 Spend from suppliers with operations emissions Science-Based emissions targets Net-zero -20% 30% by 2030* by 2025 * by 20
Slide 26: Making an environmental impact with our Planet Positive offering
Making an environmental impact with our Planet Positive offering Customer benefits: • Energy efficiency • Carbon efficiency Over 100 Planet Positive Planet Positive is a • Optimized for using renewable energy products competitive advantage • Water efficiency • Less pollution • Reduced embedded carbo
Slide 27: Examples of our Planet Positive solutions
Examples of our Planet Positive solutions Minerals processing Energy- Energy efficient Concorde CellTM efficient Horizontal Mill for recovering fine modular In-pit Plant units for and ultra-fine crush and optimized particles with convey grinding minimized energy solutions circuit throughput and wate
Slide 28: Examples of our Planet Positive solutions
Examples of our Planet Positive solutions Spare and wear parts, upgrades and modernizations Truck body Optimized wear parts Repairs Lighter, more More efficient Extending payload & less processes the lifetime fuel per hauled Long lasting wears of customer ton Lower energy assets for consumption redu
Slide 29: Industry-leading service expertise with global network
Industry-leading service expertise with global network • Comprehensive service portfolio from spares and wears to advanced lifecycle services • World-class team of experts • Efficient service processes to enable our experts to get it right – fast • Deep understanding of customer process, product des
Slide 30: Strong innovation and R&D power
Strong innovation and R&D power Close 70 30 98% 7,400+ to 30 million euros New Planet Investment in R&D centers, R&D project Patents Positive launches research and co-creating spend with in 2022 development in and customizing sustainability 2022 solutions to targets in 2022 customers 30
Slide 31: Uncompromised safety in offering and operations
Uncompromised safety in offering and operations Safe and responsible supply chain LTIFR* (2022) 1.1 Long-term target Zero harm TRIFR** (2022) Health and safety Safe products Safe and responsible 2.8 of people and services supply chain Long-term target Zero harm • Safe and secure • Products designed
Slide 32: Our industry leading diverse group of professionals
Our industry leading diverse group of professionals Our largest countries People Our people Our people Chile 2,800 by geography by employee category Finland 2,400 Brazil 1,600 Europe India 1,400 South America Blue collars China 1,000 Asia Pacific and Greater Professionals United States 960 China Man
Slide 33: Diversity & inclusion is the basis of everything we do
Diversity & inclusion is the basis of everything we do • We are committed to developing a workplace where diversity and inclusion is embedded and celebrated in our culture. • We believe that an inclusive environment where everyone can be their genuine selves makes our teams and our business stronger
Slide 34: Metso Outotec leadership team
Metso Outotec leadership team Extended Metso Outotec Executive Team CEO Pekka Vauramo Metso Outotec CFO’s office Legal & Compliance HR Executive Eeva Sipilä Nina Kiviranta Carita Himberg Team Aggregates Minerals Metals Services Consumables Markku Simula Markku Teräsvasara Piia Karhu Sami Takaluoma H
Slide 35: Our offering
Our offering Metso:Outotec
Slide 36: Aggregates to build modern societies
Aggregates to build modern societies Supplying equipment and services for a diverse customer base Customer benefits • Best cost, best availability, easy- to-buy, and easy-to-own solutions • Comprehensive range of brands and solutions • Less noise and dust in urban environments • Timely and reliable
Slide 37: Driven by sustainability and digitalization
Driven by sustainability and digitalization Crushers and screens • Mobile and portable machines and plants • Stationary crushing and screening plant systems Spares and wears • Spare and wear parts and upgrades Professional services Our equipment is Digital customer • Installation, inspections, plant
Slide 38: Multi-brand: Serving our customers' different needs
Multi-brand: Serving our customers’ different needs Aggregates recycling Aggregates Quarries Global brands & demolition contractors OEM business Nordtrack Lokotrack High performance crushing & screening solutions Mobile crushing, screening & recycling Aggregates recycling Aggregates Quarries Regiona
Slide 39: Minerals processing
Minerals processing Focus on smarter and more sustainable mining processes Faster speed of innovation Our customers Energy Water Agility New levels are focusing on: consumption stewardship through, for of reliability example, modularity 39
Slide 40: Presence in the whole ore to metals value chain
Presence in the whole ore to metals value chain Energy Water and circularity Emissions Exploration and mine planning Tailings management Metal product Hauling and Crushing and Grinding Refining conveying screening Separation Dewatering W E C R E A T E T H E B I G G E S T I M P A C T T H R O U G H O
Slide 41: Capturing the value of ore, responsibly
Capturing the value of ore, responsibly Leading offering for mining and minerals processing Broad offering Driving sustainable ranging from pre-feasibility flowsheets studies, engineering and An extensive range of Planet process equipment to complete Positive products continuously process islands an
Slide 42: Comprehensive expertise with a full portfolio of sustainable solutions
Comprehensive expertise with a full portfolio of sustainable solutions for all ore types and processes Grinding Separation Materials handling Plant Solutions Industry’s most comprehensive Maximizing recovery throughout Less maintenance, safer Unmatched performance and portfolio minerals’ processing
Slide 43: Innovation leader across the entire mining value chain
Innovation leader across the entire mining value chain Equipment and process performance with intelligent Planet Positive solutions Superior performance Optimal comminution process in beneficiation Reduced downtime Reduced energy costs Improved availability Unrivaled recovery Smart dewatering Proces
Slide 44: Advanced solutions from ore or concentrate to metal
Advanced solutions from ore or concentrate to metal Metso Outotec for metals Global leader in process Unique portfolio with best-in- Leading solutions for R&D focus on carbon-free technologies for metal and class technology and expertise decreasing customers’ CO2 production with innovative chemical
Slide 45: Leading process technology for metals producers
Leading process technology for metals producers Plants, equipment, and services Agglomeration Industries served Process solutions for • Base metals • Pelletizing • Iron & steel • Sintering • Precious metals • Light metals • Fertilizers Pyrometallurgy Sulphuric acid Process solutions for Process solu
Slide 46: Strong portfolio of metals processing technologies
Strong portfolio of metals processing technologies Acid plant process Calcining >650 completed acid plant >1,500 Rotary Kiln Installations deliveries for Minerals and Metals • High-efficiency gas cleaning Calcining & Roasting solutions Iron ore agglomeration • Largest Metallurgical Acid >400 Sinter
Slide 47: Life Cycle Services - unique maintenance and optimization capabilities
Life Cycle Services - unique maintenance and optimization capabilities and process expertise A market leader: Globally 500+ Life Cycle Services contracts Long-term solutions to help Common objectives: our customers exceed their performance targets through partnership Improved Highest safety, lowest
Slide 48: Our service solutions improve customers' equipment and process efficiency
Our service solutions improve customers’ equipment and process efficiency sustainably • Spare and wear parts Life Cycle Services • We produce solutions built to perform for the entire market, • Modernizations, not just for the upgrades Metso Outotec and retrofits installed base • Process optimizatio
Slide 49: Optimal wear solutions for the entire value chain
Optimal wear solutions for the entire value chain Crusher wear parts Loading and hauling Designed to the same Wide range of wear linings specifications and exacting covering chute, conveyor and standards as our crushing loading and hauling solutions equipment, ensuring equipment designed to optimize
Slide 50: Not all spare parts are created equal
Not all spare parts are created equal Screening Metso Outotec screen and feeder parts boast a strong design to suit tough operating conditions. Crushing Grinding Filtration Wide-ranging parts offering for A proven history of designing, Readily available parts, enabling gyratory, cone and jaw crusher
Slide 51: Q4 and full-year 2022 results
Q4 and full- year 2022 results
Slide 52: Q4/22 highlights
Q4/22 highlights Strong market activity and orders High sales growth Strong adjusted Good progress EBITA margin of in sustainability 14.8% Operating cash flow improved as inventory levels stabilized 52
Slide 53: Group Q4/22 key figures
Group Q4/22 key figures Orders, sales and adj.EBITA EUR million % EUR million Q4/2022 Q4/2021 Change % Orders received 1,590 1,310 21 Sales 1,434 1,278 12 Adjusted EBITA 212 164 30 % of sales 14.8 12.8 – Operating profit 185 130 42 % of sales 12.9 10.2 – Earnings per share, continuing 0.16 0.11 45 o
Slide 54: Group full-year key figures
Group full-year key figures Dividend proposal of EUR 0.30 EUR million 2022 2021 Change % EUR Orders received 6,024 5,421 11 Sales 5,295 4,236 25 * Adjusted EBITA 731 547 34 % of sales 13.8 12.9 – Operating profit 504 425 19 % of sales 9.5 10.0 – EPS, continuing operations, EUR 0.40 0.35 14 Cash flow
Slide 55: Aggregates segment quarterly highlights
Aggregates segment quarterly highlights EUR million % • Orders received EUR 364 million (EUR 331 million) ◦ Supported by strong North America, pricing and Tesab acquisition ◦ Equipment +18%, services -5% • Sales EUR 387 million (EUR 324 million) ◦ Strong execution of the backlog ◦ Services share 30%
Slide 56: Minerals segment quarterly highlights
Minerals segment quarterly highlights EUR million % • Orders EUR 1,030 million (EUR 849 million) ◦ Strong market activity ◦ Equipment orders +46%, incl. two larger orders ◦ Services orders +5% • Sales EUR 921 million (EUR 847 million) ◦ Equipment -7% due to the Russia wind-down ◦ Services +21% ◦ Ser
Slide 57: Metals segment quarterly highlights
Metals segment quarterly highlights EUR million % • Orders received EUR 196 million (EUR 129 million) ◦ Healthy customer activity • Sales EUR 125 million (EUR 106 million) ◦ Increased deliveries from backlog ◦ Services share 18% (10%) • Adjusted EBITA EUR 15 million (EUR 21 million) ◦ Adjusted EBITA
Slide 58: Income Statement
Income Statement EUR million Q4/2022 Q4/2021 Q1-Q4/2022 Q1-Q4/2021 EUR Sales 1,434 1,278 5,295 4,236 Adj. EBITA 212 164 731 547 Adj. EBITA, % 14.8 12.8 13.8 12.9 Operating profit* 185 130 504 425 Operating profit*, % 12.9 10.2 9.5 10.0 Net financial expenses -16 -14 -63 -39 Profit before taxes 169 1
Slide 59: Balance Sheet
Balance Sheet EUR million Dec 31, 2022 Dec 31, 2021 EUR million Intangible assets 1,972 2,002 Total property, plant and equipment 407 373 Right-of-use assets 115 127 Other non-current assets 262 234 Inventories 1,846 1,269 Receivables (trade and other) 1,551 1,285 Liquid funds 601 473 Assets held fo
Slide 60: Working capital affected by inventory increase
Working capital affected by inventory increase EUR million EUR million 60
Slide 61: Cash flow improved in Q4/22
Cash flow improved in Q4/22 EUR million Q4/2022 Q4/2021 Q1-Q4/2022 Q1-Q4/2021 EUR million Profit for the period 106 120 301 342 Adjustments: Depreciation and amortization 40 42 156 167 Financial expenses, net 16 14 63 39 Income taxes 40 22 113 92 Other items 45 -1 65 -2 Total adjustments 142 77 398
Slide 62: Financial position
Financial position • New EUR 300 million bond issued EUR million Dec 31, 2022 Dec 31, 2021 • Purchase of EUR 103 million of the outstanding bonds maturing in 2024 Liquid funds 601 473 • EUR 50 million research, development, and Net debt 684 470 innovation (RDI) loan signed with European Investment B
Slide 63: Planet Positive highlights
Planet Positive highlights • Sales EUR 1.3 billion with +51% growth • Close to 30 launches and portfolio refreshes ◦ Digital strongly present • Several partnerships for developing decarbonized steel production • CircoredTM pilot plant investment for hydrogen-based direct reduction of fine iron ore S
Slide 64: Sustainability highlights in 2022
Sustainability highlights in 2022 • Several green transition projects completed • 20% of spend with suppliers having Science Based Targets • 99.7% of R&D project spend with sustainability targets • Continued progress on people and culture ◦ Multiple actions to drive diversity and inclusion 64
Slide 65: Market Outlook
Market Outlook Metso Outotec has changed its outlook and expects the overall market activity to remain at the current level in both the mining and aggregates markets. In its previously published outlook Metso Outotec expected the overall market activity to remain at the current level, with the minin
Slide 66: Partner for positive change
Partner for positive change mogroup.com