Valmet Corp · OMXHEX:VALMT
Valmet — Forest Products & Paper Seminar 2015
44 slides from Valmet's conference presentation, May 13, 2015
Slide 1: Valmet – unique offering with process technology, automation and services
Valmet – unique offering with process technology, automation and services Forest Products & Paper Seminar 2015 Pasi Laine President and CEO
Slide 2: Agenda
Agenda Forest Products & Paper Seminar 2015 1 Valmet overview 2 Q1/2015 in brief 3 Automation 4 Investment highlights 5 Customer cases 6 Conclusions
Slide 3: Valmet overview
Valmet overview Valmet <>
Slide 4: Valmet's road to becoming a global market leader
Valmet’s road to becoming a global market leader 1797 Tamfelt 1951 1968-1996 End of 2013 1856 Tampella Valmet Several M&As i.e. Demerger to create 1858 Beloit 1986 KMW Valmet and Metso 1987 Wärtsilä paper finishing machinery 1860 KMW 1992 Tampella Papertech 1868 Sunds Defibrator 1942 1951-1995 1999
Slide 5: A leading service and technology company
A leading service and technology company Net sales (2014) Strong market position in all markets served Stable, growing and 15% 18% profitable services business 21% Strong capital business with 40% 11% high technological know- how 13% 2014 figures Orders received EUR 3,071 M 39% Net sales EUR 2,473 M
Slide 6: Our four business lines serve the same customer base
Our four business lines serve the same customer base Services Pulp and Energy Paper Automation Net sales1 1.0 bn Net sales1 1.0 bn Net sales1 0.5 bn Net sales2 0.3 bn • Mill and plant Technologies and Technologies and Process automation improvements solutions for solutions for solutions for • Roll a
Slide 7: Strong global presence – good platform for growth
Strong global presence – good platform for growth North America China • Large installed base to be serviced EMEA • Service growth potential through • Capital project growing installed base • Large installed base to be serviced opportunities in pulp, • Capital project opportunities energy, board, and
Slide 8: Global customer base
Global customer base Pulp Paper Energy Process 80% of Process Automation Systems’ sales to Valmet’s current customer industries Valmet is a registered trademark of Valmet Corporation. Other trademarks appearing here are trademarks of their respective owners. 8 May 13, 2015 © Valmet | Pasi Laine, Pre
Slide 9: Valmet's way forward
Valmet’s way forward Our Vision To become the global Our Must-Wins champion in serving our customers Our Strategy Customer excellence Valmet develops and Leader in technology supplies competitive and innovation Our Mission technology and services Excellence in Converting renewable processes to
Slide 10: Q1/2015 in brief
Q1/2015 in brief Valmet <>
Slide 11: Q1/2015 in brief
Q1/2015 in brief Orders received and net sales increased in services • Services orders received increased compared with Q1/2014 • Net sales increased compared with Q1/2014 in Services Orders received decreased and net sales increased in capital business • Orders received decreased in Pulp and Energy
Slide 12: Key figures Q1/2015
Key figures Q1/2015 EUR million Q1/2015 Q1/2014 Change Orders received 580 1,101 -47% Order backlog1 2,064 1,972 5% Net sales 561 519 8% EBITA2 19 4 >100% % of net sales 3.5% 0.7% EBIT3 13 -8 % of net sales 2.4% -1.5% Earnings per share, EUR 0.05 -0.04 Return on capital employed (ROCE), before taxes
Slide 13: Orders received declined from the high level in Q1/2014
Orders received declined from the high level in Q1/2014 Orders received (EUR million), Orders received (EUR million), by business line by area 1,400 3,500 1,400 3,500 1,200 1,101 3,000 1,200 1,101 3,000 1,023 1,023 1,000 212 2,500 1,000 59 2,500 190 420 121 800 2,000 800 2,000 580 480 580 35 466 600
Slide 14: EBITA-margin increased compared with Q1/2014
EBITA-margin increased compared with Q1/2014 Net sales and EBITA before NRI (EUR million) 777 EBITA target 6–9% 6.1% 588 590 561 519 3.7% 5.5% 3.5% 0.7% Services Capital 251 235 278 242 224 EBITA-% Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 EBITA before 4 22 32 48 19 NRI (MEUR) • Net sales and profitability incr
Slide 15: Key Must-Win objectives to improve profitability to the targeted level of 6–9%
Key Must-Win objectives to improve profitability to the targeted level of 6–9% Improve project Reduce quality Savings in Improve product and service costs and lead procurement cost margin times competitiveness to increase gross profit Harmonization of Common quality Increase sourcing Focus o
Slide 16: Guidance and short-term market outlook
Guidance and short-term market outlook Guidance for 2015 (as given on February 6, 2015) Valmet estimates that, including the acquisition of Process Automation Guidance for Systems, net sales in 2015 will increase in comparison with 2014 (EUR 2015 2,473 million) and EBITA before non-recurring items i
Slide 17: Automation
Automation Valmet <>
Slide 18: Valmet becomes a stronger company as a result of the acquisition of Process Automation Systems
Valmet becomes a stronger company as a result of the acquisition of Process Automation Systems The acquisition was announced on January 15, 2015 The acquisition has an excellent strategic fit Combination of Valmet and Automation creates a unique customer offering Automation is a strong, established
Slide 19: Combination of Valmet and Automation creates a unique customer offering
Combination of Valmet and Automation creates a unique customer offering Valmet is a technology and Valmet is a unique company service company with full automation offering Process technology Strengthened competitiveness from combination of paper, pulp and power plant technology, process know-how
Slide 20: Automation in brief
Automation in brief Supplies and develops automation and information management systems, applications and services Net sales (2014) Global market leader with #1 market position in pulp and 9% paper 19% 9% Industry-leading product portfolio Comprehensive services High barriers to entry and a limited
Slide 21: Automation offering
Automation offering Distributed • Complete control system platform for several processes: process, Control machine, drive controls and information management System (DCS) • Used for monitoring and controlling distributed equipment in process plants and industrial processes Quality Control • A system
Slide 22: Strengthened presence close to customers
Strengthened presence close to customers Valmet: Over 100 locations in 30 countries • 70 service centers Automation: • 50 sales offices • 1,600 automation professionals • 30 production units • 80 locations • 13 technology centers Valmet location Automation location 22 May 13, 2015 © Valmet | Pasi La
Slide 23: Investment highlights
Investment highlights Valmet <>
Slide 24: Investment highlight summary
Investment highlight summary 1 Strong market position in growing markets Growing, profitable and stable service and 2 automation business with EUR 1.3 billion sales Strong in cyclical capital business with long-term growth 3 potential and increased flexibility in cost structure Unique offering with
Slide 25: Strong market position in growing markets
1 2 3 4 5 Strong market position in growing markets Services Pulp Energy Board Tissue Paper Automation #1-2 #1-2 #1-3 #1-2 #1 #1-2 #1-3 ~2% 7.5 ~1% 1.4 ~1% 2.0 ~3% 1.0 ~3% 0.6 ~-1% 0.6 ~1% 2.0 p.a. bn p.a. bn p.a. bn p.a. bn p.a. bn p.a. bn p.a. bn • Customers • Growth in • Growth in • World trade,
Slide 26: Growing, profitable and stable service and automation business with EUR 1.3 billion sales
1 2 3 4 5 Growing, profitable and stable service and automation business with EUR 1.3 billion sales Growing Services net sales growth on average over 3% p.a. during the last 5 years Slight growth in Automation net sales over the last 10 years Profitable Relatively stable margins in Automation
Slide 27: Strong in cyclical capital business with long-term growth potential and increased flexibility in cost structure
1 2 3 4 5 Strong in cyclical capital business with long-term growth potential and increased flexibility in cost structure Pulp and Energy Paper Market position: Market position: #1-3 #1-2 Headcount reduction1: Headcount reduction1: ~500 ~800 Capacity cost reduction: Capacity cost reduction: 10% 20%
Slide 28: Unique offering with process technology, automation and services
1 2 3 4 5 Unique offering with process technology, automation and services Process • Valmet is a technology and technology service company with full automation offering • Strengthened competitiveness from combination of paper, pulp and power plant technology, process know-how and automation • Full s
Slide 29: Continued focus on profitability, more effort into renewal
1 2 3 4 5 Continued focus on profitability, more effort into renewal Continued focus on • Improve project and service margin profitability • Reduce quality costs and lead times improvement • Savings in procurement measures • Continue to improve cost competitiveness • Improve cost competitiveness to
Slide 30: Customer cases
Customer cases Valmet <>
Slide 31: Riograndense's new pulp line in Brazil
Key technology to CMPC Celulose Riograndense’s new pulp line in Brazil Agreement was finalized in June Main parts of the pulp line, an integrated 2013 and the successful start-up was automation solution and operator training simulator for all mill process areas on May 3, 2015 Valmet's delivery c
Slide 32: Siam Kraft PM 16, Thailand
Siam Kraft PM 16, Thailand The third OptiConcept M containerboard line in operation Latest containerboard making technology. Sompob Witworrasakul Lightweight fluting. Trim width 6,660 mm. Design speed 1,300 m/min. Engineering Director, SCG Paper Raw material 100% recycled fibers. Extended scope of s
Slide 33: Fabrica de Papel San Francisco PM6, Mexico
Fabrica de Papel San Francisco PM6, Mexico Full flexibility and high capacity with Advantage NTT Tissue Technology Valmet Advantage NTT tissue machine Dario Palma y Meza Espinoza, High flexibility with energy and fiber savings Director of Operations Swing from plain to textured mode in a few hours.
Slide 34: LignoBoost lignin separation plant to Stora Enso
LignoBoost lignin separation plant to Stora Enso Lignin can be utilized as renewable fuel replacing fossil fuels and as new bio-material for many industries Stora Enso Sunila, Kotka, Finland The LignoBoost plant is integrated Photo: Stora Enso with Stora Enso’s Sunila pulp mill to separate and col
Slide 35: Äänekoski bioproduct mill
Äänekoski bioproduct mill Valmet and Metsä Fibre have signed Process know-how and automation the agreement for the supply of key expertise combined technology to Metsä Fibre's new Äänekoski bioproduct mill in Finland Valmet delivery includes recovery boiler, pulp drying line, gasification plant,
Slide 36: Conclusion
Conclusion Valmet <>
Slide 37: Investment highlight summary
Investment highlight summary 1 Strong market position in growing markets Growing, profitable and stable service and 2 automation business with EUR 1.3 billion sales Strong in cyclical capital business with long-term growth 3 potential and increased flexibility in cost structure Unique offering with
Slide 38: Important notice
Important notice 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 growth, profitability and investment willingness, expectations fo
Slide 39: FORWARD
FORWARD
Slide 40: Appendix
Appendix Valmet <>
Slide 41: Growth in orders received and net sales in Services
Growth in orders received and net sales in Services Orders received (EUR million) Net sales (EUR million) 2014: 2014: EUR 1,055 million EUR 989 million 300 273 273 293 1,200 300 278 1,200 267 242 251 242 250 1,000 250 224 235 1,000 200 800 200 800 150 600 150 600 100 400 100 400 50 200 50 200 0 0 0
Slide 42: Orders received decreased and net sales increased in Pulp and Energy
Orders received decreased and net sales increased in Pulp and Energy Orders received (EUR million) Net sales (EUR million) 2014: 2014: EUR 1,344 million EUR 956 million 800 1,600 400 1,600 700 622 1,400 350 312 1,400 600 560 1,200 300 1,200 229 234 222 500 1,000 250 1,000 400 800 200 181 800 300 600
Slide 43: Orders received and net sales decreased in Paper
Orders received and net sales decreased in Paper Orders received (EUR million) Net sales (EUR million) 2014: 2014: EUR 671 million EUR 528 million 300 900 300 900 250 212 750 250 750 190 186 200 600 200 600 142 149 150 128 450 150 120 450 114 108 97 100 300 100 300 50 150 50 150 0 0 0 0 Q1/14 Q2/14
Slide 44: FORWARD
FORWARD