Wartsila Oyj Abp · OMXHEX:WRT1V
Wartsila Oyj Abp — Wärtsilä — Investor Day (November 2007)
26 slides from Wartsila Oyj Abp's investor day presentation, Nov 20, 2007
Slide 1: Services, the growth engine
Services, the growth engine Tage Blomberg Group Vice President, Services 1 © Wärtsilä Capital Market Day, November 20th, 2007 / Tage Blomberg, Group Vice President, Services
Slide 2: Topics of this presentation
Topics of this presentation Wärtsilä Services grows steadily and brings stability to cyclical businesses. How does it work? • Is there a cyclicality in service business? How does Wärtsilä Services sustain growth over time? • During an upturn is it common to service more, or less? • How much service
Slide 3: Is there a cyclicality in service business?
Is there a cyclicality in service business? How does Wärtsilä Services sustain growth over time? 3 © Wärtsilä Capital Market Day, November 20th, 2007 / Tage Blomberg, Group Vice President, Services
Slide 4: Market demand for our services in different segments
Market demand for our services in different segments • Peaks and lows are often regional or within a segment. They can be caused by a global market economy incident, but always only for a limited period of time or a defined segment. – e.g. 9/11 slowed down the cruise industry business for some month
Slide 5: Wärtsilä Services Net Sales Development
Wärtsilä Services Net Sales Development Innovation is a core factor for growth. 1400 Net Sales in M€ 1200 1000 800 600 400 200 0 96 97 98 99 00 01 02 03 04 05 06 19 19 19 19 20 20 20 20 20 20 20 Organic Acquisitions 5 © Wärtsilä Capital Market Day, November 20th, 2007 / Tage Blomberg, Group Vice Pre
Slide 6: Acquisitions & Joint Ventures
Acquisitions & Joint Ventures 2006 • Stockholms fartygreparationer AB 2002 Sweden • JMC Marine A/S • INTEC Injectortechnic GmbH Denmark Germany • CGL Industries Ltd 2004 • Wärtsilä BLRT Services Canada Klaipeda UAB (JV) • Decam B.V. Lithuania • Metalock Singapore Ltd Netherlands Singapore • Total Au
Slide 7: Service growth steadily between 10% and 15%
Service growth steadily between 10% and 15% Wärtsilä Services maintain its leading position and further growth by: Developing the service scope and the customer base through strategic acquisitions and continuous innovation Expanding within the installed base and moving into new markets outside the t
Slide 8: During an upturn is it common to service more or less?
During an upturn is it common to service more or less? 8 © Wärtsilä Capital Market Day, November 20th, 2007 / Tage Blomberg, Group Vice President, Services
Slide 9: During upturn is it common to service more or less?
During upturn is it common to service more or less? Down-time Repair Service MTBF, MTTR agreements Maintenance guarantee OEM Services up-times Running Idling During high season, service measures are cut down, however, high seasons only last a few months. Equipment is serviced before or after Up-time
Slide 10: During upturn is it more common to service more or less?
During upturn is it more common to service more or less? To maintain high availability, Wärtsilä Services has developed a large portfolio of support services: – Condition Based Maintenance (CBM), – Support with visits on board, – Training and competence development programs, – Service agreements… In
Slide 11: Condition Based Operations & Maintenance
Condition Based Operations & Maintenance Measuring the important Data transfer & Monitoring, Analysis equipment parameters Communications and feed-back 80% 90% of critical of required cases maintenance identified predicted 7 to 30 1 to 4 days month 600 engines connected in advance equivalent to 5000
Slide 12: The Best Services in the Industry
The Best Services in the Industry Operations & Management Inventory management Technical Condition-based maintenance Remote monitoring Support Regular technical visits Agreement Exclusive training plan Wärtsilä personnel for major OH Technical Support Agreement + Global Covers several vessels along
Slide 13: How much service does older equipment need?
How much service does older equipment need? 13 © Wärtsilä Capital Market Day, November 20th, 2007 / Tage Blomberg, Group Vice President, Services
Slide 14: Typical customer needs versus Product Lifecycle
Typical customer needs versus Product Lifecycle Impacts of Innovation Nbr of Equipment A B C D 25-30 Years Limited Launch Maturity End High technical support World class logistic Specific assortment Customer Assistance Service agreement Upgrading packages New product training CBM Environmental solut
Slide 15: How much service does older equipment need?
How much service does older equipment need? There are about 60’000 vessel in shipping industry, all of them with engines, auxiliary equipment, control and automation, propellers. Environmental and Safety Regulations have greatly increased pressure on ship owners. Most of them are not only applicable
Slide 16: Wärtsilä Services offer a large range of solutions
Wärtsilä Services offer a large range of solutions Basic Services Management Support Performance Optimizers • Parts • Service Agreements • Upgrades • Field Services • Operation & Maintenance • Conversions • Technical Support • CBM • Safety Solutions • Workshop Services • Custom Projects • Monitoring
Slide 17: Wärtsilä Services offer a large range of solutions
Wärtsilä Services offer a large range of solutions Environment Solutions Online Services • Emission Control System • Interactive Electronic Technical Manuals for SOx, NOx, Smoke ELDOC, Bulletin Online, MAMA, FAKS • Emission measurement • e-Services Spares Online, Report Online • Certification Suppor
Slide 18: Market potential and market share for Wärtsilä Services?
Market potential and market share for Wärtsilä Services? 18 © Wärtsilä Capital Market Day, November 20th, 2007 / Tage Blomberg, Group Vice President, Services
Slide 19: Service business for a customer depends on:
Service business for a customer depends on: Customer dependent • Engine load Wärtsilä dependent • Fuel quality • Maintenance team • Expertise • Operation procedure • Availability • Installation workload • Reactivity • Operators’ skills • Adequate solution • Price & ROI • Guarantee Market dependent •
Slide 20: Market shares for Services?
Market shares for Services? • 30’000 equipment in marine market too • 4’000 engines in land markets many variables • Equipment in different stages in their lifecycle makes • Markets in >70 countries estimation of market • Markets in >12 industries share irrelevant • Customer & market dependent param
Slide 21: Services Jan-Sept 2007 in short
Services Jan-Sept 2007 in short Net Sales [MEUR] 1-9/2007 1-6/2006 Change Net Services 1.119 916 22,2% Sales Wärtsilä group 2.491 2.204 13,0% Personnel 1-9/2007 1-6/2006 Change Services 9.288 8.387 10,7% Wärtsilä group 15.811 13.986 13,0% 45% of Wärtsilä group net sales personnel 59% 21 © Wärtsilä C
Slide 22: What is Wärtsilä's competitive advantage?
What is Wärtsilä’s competitive advantage? 22 © Wärtsilä Capital Market Day, November 20th, 2007 / Tage Blomberg, Group Vice President, Services
Slide 23: Customers
Multiple expertise to serve customer’s needs Engine Services Customer Relationship Management Operations & Management Customers Automation Services Propulsion Services Ship Services Reconditioning Services Training Services Wärtsilä Services becomes the most valued business partner by understanding
Slide 24: Continuously expanding the own network
Continuously expanding the own network Product Company 70 countries Network > 160 locations Workshop > 9’300 people Newest locations ~ 6’000 field service forces 24 © Wärtsilä Capital Market Day, November 20th, 2007 / Tage Blomberg, Group Vice President, Services
Slide 25: Innovation, a state of mind in Wärtsilä
Innovation, a state of mind in Wärtsilä Secondary Technologies Fuel & Gas SCR Dual Fuel engine Scrubbers Bio fuel engine Oily Water Separation Gas Engines Low Loss Concept Conversions … Safety … Environment Efficiency Primary Technologies Common Rail Efficiency & Innovations Direct Water Injection F
Slide 26: © Wärtsilä Capital Market Day, November 20th, 2007 / Tage Blomberg, Group Vice President,
26 © Wärtsilä Capital Market Day, November 20th, 2007 / Tage Blomberg, Group Vice President, Services