Slide 1: Wärtsilä Corporation Interim Report January-September 2015
WÄRTSILÄ CORPORATION INTERIM REPORT JANUARY-SEPTEMBER 2015 22 OCTOBER 2015 Björn Rosengren, President & CEO © Wärtsilä
Slide 2: Highlights Q3/2015
Highlights Q3/2015 • Order intake EUR 1,086 million, -17% • Net sales EUR 1,222 million, +9% • Book-to-bill 0.89 (1.17) • EBIT EUR 160 million, 13.1% of net sales (EUR 142 million or 12.7%) • EBITA EUR 170 million, 13.9% of net sales (EUR 149 million or 13.3%) • EPS EUR 0.49 (0.43) • Cash flow from
Slide 3: Year to date order intake supported by Services
Year to date order intake supported by Services MEUR 5 500 5 000 Third quarter development 4 500 MEUR 4 000 1 600 3 500 1 400 1,309 3 000 -17% 1 200 Services 1,086 2 500 10% 1 000 Marine 2 000 Solutions 800 1 500 -12% Energy 600 Solutions 1 000 400 -56% 500 200 0 0 2011 2012 2013 2014 2015 Q3/2014 Q
Slide 4: Net sales developing well, in line with our expectations
Net sales developing Net wellsales in line with our expectations MEUR 5 000 4 500 4 000 Third quarter development 3 500 MEUR 1 400 3 000 1,222 1,117 1 200 2 500 9% Services 1 000 2 000 12% Marine 800 Solutions 1 500 600 Energy 23% Solutions 1 000 400 500 200 -14% 0 0 2011 2012 2013 2014 2015 Q3/2014
Slide 5: Net sales by business 1-9/2015
Net sales by business 1-3/2012 Net sales by business 1-9/2015 Marine Solutions Services 33% (36) 45% (43) Energy Solutions 22% (22) 5 © Wärtsilä
Slide 6: Book-to-bill ratio remains above one
Book-to-bill ratio remains above one MEUR 5 500 1,2 1.07 1.05 1.05 1.06 1.03 5 000 4 500 1,0 4 000 0,8 3 500 3 000 0,6 2 500 2 000 0,4 1 500 1 000 0,2 500 0 0,0 2011 2012 2013 2014 1-9/2015 Order intake Net sales Book-to-bill 6 © Wärtsilä
Slide 7: Order book distribution
Order book distribution Order book distribution MEUR 4 000 3 500 3 000 2 500 2 000 1 500 1 000 500 0 30.9.2014 30.9.2015 Delivery current year Delivery next year or later 7 © Wärtsilä
Slide 8: Operating result and profitability in line with expectations
Operating result and profitability in line with expectations MEUR 600 14% 11.9% 12% Third quarter development 500 11.2% 11.1% 10.9% MEUR 10% 180 14% 400 12.7% 13.1% 160 12% 8% 140 300 10% 120 6% 100 8% 200 80 6% 4% 60 4% 100 40 2% 2% 20 0 0% 0 0% 2011 2012 2013 2014 Q3/2014 Q3/2015 EBIT EBIT% EBIT i
Slide 9: Macroeconomic uncertainty continues to effect power generation markets
Macroeconomic uncertainty continues to effect power generation markets 9 © Wärtsilä
Slide 10: Energy Solutions' quotation activity on a good level
Energy Solutions’ quotation activity on a good level MW 18 000 16 000 14 000 12 000 10 000 Multi-fuel 8 000 Gas Liquid fuel 6 000 4 000 2 000 0 Q1/2012 Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Q2/2015 Q3/2015 10 © Wärtsilä
Slide 11: Energy Solutions' order intake impacted by delayed customer decision-making
Energy Solutions’ order intake impacted by delayed customer decision-making MEUR Review period development 1 800 Total EUR 642 million (792) 1 600 11% Utilities 1 400 44% 44% IPP’s* 1 200 Industrials x% 1 000 800 Review period order intake by fuel in MW 600 400 200 Oil Gas 64% 36% 0 2011 2012 2013 2
Slide 12: Energy Solutions' orders globally
Energy Solutions’ orders globally Europe 1,037 (410) 4 58 Asia 174 (326) 31 40 975 Americas 246 (539) 103 246 Africa and Middle East 230 (440) 40 Utilities 190 IPP’s Industrials Order intake 1-9/2015: 1,687 MW (1,716) 12 © Wärtsilä
Slide 13: Market for gas and liquid fuel power plants, <500 MW
Market for gas and liquid fuel power plants, <500 MW 1-6/2014 1-6/2015 Ansaldo Ansaldo Other GT’s Alstom 2.8% Other GT’s 7.4% 0.5% 2.9% 0.9% Wärtsilä Wärtsilä 9.4% 9.7% MHI 10.4% GE GE 62.3% 35.0% MHI 19.5% Siemens 10.4% Siemens 27.9% Market volume 1-6/2015: 12.6 GW (10.6), +19% Market data includes
Slide 14: Marine markets affected by low contracting and a weak sentiment in the offshore segment
Marine markets affected by low contracting and a weak sentiment in the offshore segment 14 © Wärtsilä
Slide 15: Vessel contracting activity remains low
Vessel contracting activity remains low Merchant Offshore Cruise and Ferry Special vessels 3 months moving average in CGT * 250 5 200 4 * # of vessels Million CGT 150 3 100 2 50 1 0 0 09.15 01.09 04.09 07.09 10.09 01.10 04.10 07.10 10.10 01.11 04.11 07.11 10.11 01.12 04.12 07.12 10.12 01.13 04.13 07
Slide 16: Marine Solutions' order intake impacted by market challenges
Marine Solutions’ order intake impacted by market challenges MEUR 1 800 Review period development Total EUR 1,134 million (1,286) 1 500 Offshore 11% 1 200 Gas carriers Special 35% vessels 10% 900 600 Cruise & Ferry 17% 300 Navy 4% Traditional Others 0 merchant 5% 2011 2012 2013 2014 2015 18% Q1-Q3 Q
Slide 17: Joint venture ordering activity
Joint venture ordering activity MEUR 700 • Joint venture order intake 600 totalled EUR 163 million (126) 500 during January-September 2015 400 • Wärtsilä’s share of ownership in these companies is 50%, 300 and the results are reported as a share of result of associates 200 and joint ventures 100 0 Q
Slide 18: Strong position in marine engine market
Strong position in marine engine market Medium-speed main engines Auxiliary engines Wärtsilä Others 9% (5) 16% (16) Caterpillar 13% (10) Wärtsilä Others 63% (59) 91% (95) MAN D&T 8% (15) Total market volume last 12 months: Total market volume last 12 months: 4,519 MW (4,988) 3,986 MW (4,078) Wärtsil
Slide 19: First Wärtsilä 31 engines selected to power an icebreaker
First Wärtsilä 31 engines selected to power an icebreaker • The recently introduced Wärtsilä 31 engine, the world’s most efficient 4-stroke diesel engine, has been selected to power a new generation icebreaker • The icebreaker will feature three 8-cylinder Wärtsilä 31 engines and Wärtsilä’s online m
Slide 20: Service market activity developing well
Service market activity developing well 20 © Wärtsilä
Slide 21: Continued growth in Services' net sales
Continued growth in Services’ net sales MEUR 2 000 Third quarter development 1 800 MEUR 5% -3% 5% 1 600 600 12% 531 1 400 472 500 1 200 400 1 000 800 300 600 200 400 100 200 0 0 2011 2012 2013 2014 2015 Q3/2014 Q3/2015 Q1-Q3 Q4 21 © Wärtsilä
Slide 22: Services net sales distribution 1-9/2015
Services net sales distribution 1-9/2015 Field service 24%(24) Spare parts 51%(51) Contracts 17%(17) Projects 8%(8) Total EUR 1,565 million (1,375) 22 © Wärtsilä
Slide 23: Development of service agreements
Development of service agreements MW 14 000 30% 12 000 25% 10 000 20% 8 000 15% 6 000 10% 4 000 5% 2 000 0 0% 2009 2010 2011 2012 2013 2014 30.9.2015 MW under agreement – Energy Solutions MW under agreement – Marine Solutions % of Energy Solutions’ installed base % of Marine Solutions’ installed bas
Slide 24: Fleet utilisation
Fleet utilisation Anchored Vessels & Fleet Development* 28% 23 000 Nr of Active Vessels Percent Anchored 26% 22 500 22 000 24% 21 500 22% 21 000 20% 20 500 03.13 06.13 09.13 12.13 03.14 06.14 09.14 12.14 03.15 06.15 09.15 Anchored Active Fleet Fleet Average Speed, knots** 9,6 9,4 9,2 9,0 8,8 8,6 8,4
Slide 25: Solid financial standing
Solid financial standing 25 © Wärtsilä
Slide 26: Cash flow from operating activities
Cash flow from operating activities MEUR 700 600 Review period development MEUR 500 250 400 200 300 150 200 100 100 50 0 0 2011 2012 2013 2014 1-9/2014 1-9/2015 26 © Wärtsilä
Slide 27: Working capital impacted by increased inventories
Working capital impacted by increased inventories MEUR 1 600 25% 1 400 Review period development 20% 1 200 MEUR 1 800 25% 1 000 1 600 15% 1 400 20% 800 1 200 9.8% 10% 15% 600 1 000 465 10.5%* 6.8% 800 5.6% 5.2% 8.2%* 10% 400 600 522 313 235 251 5% 379 400 5% 200 200 0 0% 0 0% 2011 2012 2013 2014 30.
Slide 28: Gearing impacted by L-3 MSI acquisition
Gearing impacted by L-3 MSI acquisition 0,50 Review period development 0,40 0,50 0,40 0,30 0,30 0,20 0,20 0,10 0,10 0,00 0,00 2011 2012 2013 2014 30.9.2014 30.9.2015 28 © Wärtsilä
Slide 29: Market outlook
Market outlook • Energy Solutions: The market for liquid and gas fuelled power generation is expected to remain challenging as economic uncertainty continues. The megatrend towards distributed, flexible gas-fired power generation is gaining further ground globally. • Marine Solutions: The outlook fo
Slide 30: Prospects for 2015 unchanged
Prospects for 2015 unchanged Wärtsilä expects its net sales for 2015 to grow by 5-10% and its operational profitability (EBIT% before non-recurring items) to be between 12.0-12.5%. The guidance includes the impact of the L-3 Marine Systems International acquisition. 30 © Wärtsilä
Slide 31: IR Contact: Natalia Valtasaari
IR Contact: Natalia Valtasaari Director, Investor Relations Tel. +358 (0) 40 187 7809 E-mail: natalia.valtasaari@wartsila.com