Slide 1: Q3 2014 Interim Review
Matti Kähkönen, President and CEO Harri Nikunen, CFO October 23, 2014 © Metso
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: Safety is our top priority
Safety is our top priority • We are committed to taking personal responsibility for our own safety and for the safety of others • All incidents can be prevented • Our LTIF has been trending down 14 450 400 12 350 10 300 8 250 6 200 4 150 100 Target: LTIF less than 1 2 50 Long term occupational safet
Slide 4: Good development in Services and Flow Control
Good development in Services and Flow Control Quarterly highlights • In line with our strategy • Services and Flow Control developed well • Low orders and net sales in mining equipment • Order intake totaled EUR 786 million, down 5% • Net sales declined 8% to EUR 861 million • EBITA* was EUR 104 mil
Slide 5: Services orders increased 5%
Services orders increased 5% Metso Metso EUR million EUR million 1,600 5,000 1,466 4,466 4,215 1,400 1,168 4,000 3,709 1,200 1,117 1,100 1,055 1,031 3,281 965 982 968 947 1,000 885 875 3,000 826 850 838 828 825 786 767 2,307 800 637 558 550 563 2,000 600 400 1,000 200 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
Slide 6: Good global coverage
Good global coverage Orders by country EUR Million Q3/2014 Q3/2013 Change % Q1-Q3/2014 Q1-Q3/2013 Change % 2013 USA 118 110 8 372 371 0 486 China 67 77 -13 208 263 -21 317 Brazil 62 65 -5 190 219 -13 314 Canada 37 47 -21 145 120 21 148 Australia 50 53 -6 163 168 -3 213 Finland 39 32 21 164 126 30 18
Slide 7: Net sales mix continues to change
Net sales mix continues to change Metso Metso EUR million EUR million 1,400 5,000 4,282 1,156 1,132 1,200 1,116 1,075 3,858 4,000 3,672 959 988 1,018 962 1,000 915 937 898 871 901 861 3,018 817 2,902 800 735 746 685 736 726 748 744 3,000 647 600 2,000 400 1,000 200 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
Slide 8: Profitability in line with our guidance
Profitability in line with our guidance EUR million % % 200 16 600 12.8 14 14.4 12.8 13.7 13.6 13.0 12.9 14 11.4 10.9 10.9 12 12.2 12.2 12.1 500 11.6 11.9 11.9 12.0 11.9 10.7 10.1 150 11.2 12 10.8 10 10.2 400 9.4 9.1 8.7 10 8.7 8.7 8.0 8 100 8 300 496 6 486 469 149 147 6 136 129 138 129 131 200 399
Slide 9: Financial performance
Financial performance Harri Nikunen, CFO
Slide 10: Services and Flow Control drive profitability
Services and Flow Control drive profitability Group key figures EUR million Q3/2014 Q3/2013 Change% Q1-Q3/2014 Q1-Q3/2013 Change% 2013 Orders received 786 825 -5 2,608 2,824 -8 3,709 without currency impact -4 -2 Services orders received 493 470 5 1,572 1,581 -1 2,038 without currency impact 7 6 Net
Slide 11: Lower EBITA driven by volume
Lower EBITA driven by volume 11 © Metso * Before non-recurring items
Slide 12: Our balance sheet remains strong
Our balance sheet remains strong Sep 30, Dec 31, 2014 2013 Return on equity (ROE), % * 15.0 19.0 Capital Employed 2,089 2,230 Return on capital employed (ROCE) before taxes, % * 15.5 18.6 Net debt 592 491 Gearing at the end of the period, % 49.6 41.6 Cash conversion, % * 105 105 Debt to capital, % 4
Slide 13: Reasonable result, despite lower volumes
Reasonable result, despite lower volumes Minerals: Key figures EUR million Q3/2014 Q3/2013 Change% Q1-Q3/2014 Q1-Q3/2013 Change% 2013 Orders received 558 609 -8 1,817 2,078 -13 2,745 without currency impact -7 -7 Services orders received 372 346 8 1,158 1,168 -1 1,506 without currency impact 10 7 Ne
Slide 14: Profitability not largely affected by lower volumes
Profitability not largely affected by lower volumes Minerals: Rolling 12-month net sales and EBITA%* % EUR million 4,000 14% 3,500 12% 3,000 10% 2,500 8% 2,000 6% 1,500 4% 1,000 2% 500 0 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2009 2010 2011 2012 2013 2014 Services ne
Slide 15: Good order momentum continues
Good order momentum continues Flow Control: Key figures EUR million Q3/2014 Q3/2013 Change% Q1-Q3/2014 Q1-Q3/2013 Change% 2013 Orders received 230 226 2 794 779 2 1,012 without currency impact 1 5 Services orders received 120 124 -3 414 412 0 533 without currency impact -2 4 Net sales 247 243 1 712
Slide 16: Strong profitability due to good margins and lower costs
Strong profitability due to good margins and lower costs Flow Control: Rolling 12-month net sales and EBITA%* % EUR Million 1,000 20% 900 18% 800 16% 700 14% 600 12% 500 10% 400 8% 300 6% 200 4% 100 2% 0 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2009 2010 2011 2012 2013
Slide 17: Profit improvement program proceeding according to plan
Profit improvement program proceeding according to plan • The current scope encompasses gross headcount reduction of 1,300 - 1400 • Targeted gross savings are EUR 120-130 million • Completion rate is 75%, targeting full completion by the end of 2014 • Net personnel cost savings in Q1-Q3/2014 vs. Q1-
Slide 18: Outlook and guidance
Outlook and guidance Matti Kähkönen President and CEO
Slide 19: Market outlook remains roughly unchanged
Market outlook remains roughly unchanged Mining Aggregates Flow Control 55% of net sales 20% of net sales 22% of net sales of which 55% services of which 40% services of which 45% services Current demand: Current demand: Current demand: • Weak for the equipment and • Satisfactory for equipment and •
Slide 20: Backlog for Services and Flow Control has grown
Backlog for Services and Flow Control has grown EUR million EUR Million 4,000 2,500 2,000 3,000 2,506 Deliveries after 2,324 2013 1,500 2,117 Deliveries after 2,010 1,927 1,872 2014 2,000 1,730 1,000 1,364 Minerals, capital Deliveries in Deliveries in 1,000 2013 2014 500 0 0 Q4 Q4 Q4 Q4 Q4 Q3 Q4 Q3
Slide 21: Guidance for 2014
Guidance for 2014 Original guidance from February 6 intact Based on our market outlook, backlog for 2014, current exchange rates and ongoing cost-efficiency actions, we estimate that • our net sales in 2014 will be somewhat below 2013 and • EBITA margin before non recurring items for 2014 will be ar
Slide 22: www.metso.com
www.metso.com company/metso metsoworld metsogroup metsoworld metsogroup