Slide 1: Wärtsilä Corporation Result Presentation 2016
WÄRTSILÄ CORPORATION RESULT PRESENTATION 2016 27 January 2017 Jaakko Eskola, President & CEO 1 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 2: Highlights 2016
Highlights 2016 • Order intake stable at EUR 4,927 million • Net sales EUR 4,801 million, -5% • Book-to-bill 1.03 (0.98) • Comparable operating result EUR 583 million, 12.1% of net sales (EUR 612 million or 12.2%) • Earnings per share EUR 1.79 (2.25) • Cash flow from operating activities EUR 613 mil
Slide 3: Improved sentiment in the energy markets supported order intake
Improved sentiment in the energy markets supported order intake MEUR 5 500 5 000 Fourth quarter development 4 500 MEUR 4 000 1 600 1,403 1,324 3 500 1 400 -6% 3 000 1 200 -1% Services 2 500 1 000 2 000 800 Marine -45% Solutions 1 500 600 1 000 400 Energy 37% Solutions 500 200 0 0 2012 2013 2014 2015
Slide 4: Net sales developed in line with guidance
Net sales developed in line with guidance MEUR 5 500 5 000 Fourth quarter development 4 500 MEUR 4 000 1 800 1,590 1,559 3 500 1 600 -2% 3 000 1 400 3% 2 500 1 200 Services 1 000 2 000 Marine 800 Solutions 1 500 -15% 600 1 000 Energy 400 11% Solutions 500 200 0 0 2012 2013 2014 2015 2016 Q4/2015 Q4/
Slide 5: Net sales by business 2016
Net sales by business 2016 Services Marine Solutions 46% (43) 35% (34) Energy Solutions 20% (22) 5 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 6: Book-to-bill
Book-to-bill MEUR 5 500 1,4 5 000 1,2 4 500 1.05 1.05 1.06 1.03 4 000 0.98 1,0 3 500 0,8 3 000 2 500 0,6 2 000 1 500 0,4 1 000 0,2 500 0 0,0 2012 2013 2014 2015 2016 Order intake Net sales Book-to-bill 6 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 7: Order book distribution
Order book distribution MEUR 3 500 3 000 2 500 2 000 1 500 1 000 500 0 31.12.2015 31.12.2016 Delivery next year Delivery after next year 7 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 8: Operating result supported by good fourth quarter
Operating result supported by good fourth quarter MEUR 700 14% 12.2% 12.1% 11.9% 600 12% 11.2% 10.9% 500 10% 400 8% 300 6% 200 4% 100 2% 0 0% 2012 2013 2014 2015 2016 Comparable operating result % of net sales Items affecting comparability include restructuring costs of EUR 48 million (19) and acqui
Slide 9: Energy Solutions
ENERGY SOLUTIONS 9 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 10: Quotation activity per fuel type
ENERGY SOLUTIONS Quotation activity per fuel type MW 60 000 50 000 40 000 Liquid fuel 30 000 Gas Multi-fuel 20 000 10 000 0 Q4/2013 Q1/2014 Q2/2014 Q3/2014 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Q1/2016 Q2/2016 Q3/2016 Q4/2016 Calculated on a 12 months rolling basis 10 © Wärtsilä PUBLIC 27 January
Slide 11: Strong ordering activity in Energy Solutions
ENERGY SOLUTIONS Strong ordering activity in Energy Solutions Review period development MEUR Total EUR 1,448 million (1,009) 1 800 Utilities 1 600 19% 27% Independent 1 400 power producers 1 200 Industrials 53% 1 000 800 Review period order intake 600 by fuel in MW 400 Oil Gas 200 55% 45% 0 2012 201
Slide 12: Order intake globally
ENERGY SOLUTIONS Order intake globally Europe* 1,093 (1,042) 56 118 Asia 960 (299) 94 919 Americas 921 (638) 632 234 64 282 575 Africa and Middle East 540 (457) Utilities 55 IPP’s 257 228 (Independent Power Producers) Industrials Order intake 2016: 3,513 MW (2,436) *Turkish owners contributed to the
Slide 13: Wärtsilä to deliver a 100 MW CHP plant to Germany
Wärtsilä to deliver a 100 MW combined heat and power (CHP) plant to Germany • As part of its climate action plan, Germany has committed to increasing the share of electricity produced by CHP power plants to 25% of the total electricity production by 2025. • Unlike traditional CHP power plants, Wärts
Slide 14: Market for gas and liquid fuel power plants, <500 MW
ENERGY SOLUTIONS Market for gas and liquid fuel power plants, <500 MW 1-9/2015 1-9/2016 Ansaldo Other GT’s Other GT’s 5.5% 0.8% Ansaldo 5.6% Wärtsilä 7.2% 9.9% MHI 12.0% MHI GE GE 19.8% 38.8% 35.2% Wärtsilä 14.7% Siemens Siemens 25.2% 25.3% <500 MW market volume: 17.4 GW (17.0), +2% Total market vol
Slide 15: Marine Solutions
MARINE SOLUTIONS 15 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 16: Exceptionally low newbuild vessel orders in 2016
MARINE SOLUTIONS Exceptionally low newbuild vessel orders in 2016 Merchant Offshore Cruise and Ferry Special vessels 3 months moving average in CGT * 250 5,0 4,5 200 4,0 3,5 Number of vessels 150 3,0 * Million CGT 2,5 100 2,0 1,5 50 1,0 0,5 0 0,0 12.16 01.09 03.09 05.09 07.09 09.09 11.09 01.10 03.10
Slide 17: Cruise & ferry supported Marine Solutions' order intake
MARINE SOLUTIONS Cruise & ferry supported Marine Solutions’ order intake MEUR 1 800 Review period development Total EUR 1,285 million (1,599) 1 500 Offshore Gas carriers 3% Special vessels 1 200 13% 9% 900 Traditional Cruise & 600 merchant ferry 20% 38% 300 Others 0 7% 2012 2013 2014 2015 2016 Navy
Slide 18: Marine Solutions' order book 31 December 2016
MARINE SOLUTIONS Marine Solutions’ order book 31 December 2016 Bulk carriers 1% Containers Other merchant 5% Cargo 2% Offshore RoRo 1% 12% 3% Tankers 4% Gas carriers Cruise & Ferry 21% 27% Other vessel 1% Non-vessel 3% Special vessels Navy 7% 13% 18 © Wärtsilä PUBLIC 27 January 2017 Result presentat
Slide 19: Upcoming environmental regulations support the demand for Wärtsilä's solutions
Upcoming environmental Kuva regulations support the demand for Wärtsilä’s solutions pitää • UK based Wightlink ordered a vaihtaa, comprehensive range of modern equipment and systems to ensure a high level of bonny environmental efficiency for their new ferry. This will be the first ferry to utilise
Slide 20: Strong position in marine engine market
MARINE SOLUTIONS Strong position in marine engine market Medium-speed main engines Auxiliary engines Others Wärtsilä 10% (11) 18% (16) Caterpillar 15% (15) Wärtsilä Others 51% (50) 82% (84) MAN D&T 24% (24) Total market volume last 12 months: Total market volume last 12 months: 2,392 MW (2,358) 2,02
Slide 21: Services
SERVICES 21 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 22: Stable development in Services' net sales
SERVICES Stable development in Services’ net sales MEUR 2 400 2 200 Fourth quarter development 2 000 MEUR 1 800 700 1 600 636 619 1 400 600 1 200 3% 500 1 000 400 800 300 600 200 400 200 100 0 0 2012 2013 2014 2015 2016 Q4/2015 Q4/2016 Q1-Q3 Q4 22 © Wärtsilä PUBLIC 27 January 2017 Result presentatio
Slide 23: Net sales distribution 2016
SERVICES Net sales distribution 2016 By product area By segment Special Vessels 7% (8) Offshore Field service 9% (13) 23% (23) Navy 8% (7) Spare parts Energy Solutions 49% (51) 39% (37) Agreements 15% (16) Merchant 24% (24) Projects Cruise & Ferry 13% (10) 13% (11) Total EUR 2,190 million (2,184) 23
Slide 24: Installed base totalling 180,000 MW
SERVICES Installed base totalling 180,000 MW MW 200 000 180 000 160 000 140 000 120 000 100 000 80 000 60 000 40 000 20 000 0 2012 2013 2014 2015 2016 Energy Solutions Marine Solutions, 4-stroke Marine Solutions, 2-stroke 24 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 25: Installed base covered by service agreements
SERVICES Installed base covered by service agreements 16 000 30% 14 000 25% 12 000 20% 10 000 MW 8 000 15% 6 000 10% 4 000 5% 2 000 0 0% 2009 2010 2011 2012 2013 2014 2015 2016 MW under agreement – Energy Solutions MW under agreement – Marine Solutions % of Energy Solutions’ installed base % of Mari
Slide 26: Wärtsilä and Carnival Corporation announce strategic partnership
Wärtsilä and Carnival Corporation announce strategic partnership • 12-year agreement • Ensuring safety and reliability of Carnival’s fleet • Reducing operational costs • Wärtsilä provides all engine maintenance and monitoring for fleet of 79 vessels • Continuous planning together with Carnival • Per
Slide 27: Financials
FINANCIALS 27 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 28: Operating cash flow development
FINANCIALS Operating cash flow development MEUR 700 600 500 400 300 200 100 0 2012 2013 2014 2015 2016 28 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 29: Working capital development
FINANCIALS Working capital development MEUR 1 600 25% 1 400 20% 1 200 1 000 15% 800 10.8% 9.8% 10.2% 10% 600 543 6.8% 490 465 5.2% 400 313 5% 251 200 0 0% 2012 2013 2014 2015 2016 Working capital Total inventories Advances received Working capital / Net sales 29 © Wärtsilä PUBLIC 27 January 2017 Res
Slide 30: Gearing
FINANCIALS Gearing 0,50 0,40 0,30 0,20 0,10 0,00 2012 2013 2014 2015 2016 30 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 31: EPS and dividend per share
FINANCIALS EPS and dividend per share EUR 2,5 2,0 1.79 1,5 1.30 1,0 0,5 0,0 2012 2013 2014 2015 2016* EPS Dividend * Dividend 2016 - Proposal of the Board 31 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016
Slide 32: Prospects for 2017
Setti 1 Setti 1 Prospects for 2017 The overall demand for Wärtsilä’s services and solutions in 2017 is expected to be relatively unchanged from the previous year. Demand by business area is anticipated to develop as follows: • Solid in Services with growth opportunities • Solid in Energy Solutions •
Slide 33: Thank you
THANK YOU Further information: Natalia Valtasaari Director, Investor & Media Relations Tel. +358 (0) 10 709 5637 E-mail: natalia.valtasaari@wartsila.com 33 © Wärtsilä PUBLIC 27 January 2017 Result presentation 2016