Metso Corporation · OMXHEX:METSO
Metso — Outotec — Investor Day (September 2017)
26 slides from Metso's investor day presentation, Sep 21, 2017
Slide 1: Our roadmap to reach 10% adjusted EBIT by 2020
Our roadmap to reach 10% adjusted EBIT by 2020 Outotec Capital Markets Day 2017 Markku Teräsvasara, President & CEO Outotec House - September 21
Slide 2: My agenda today
My agenda today • My first year at Outotec • Our market outlook • Our key levers to reach our targets • How we will ensure execution 2 CMD 2017 Roadmap to reach 10% adjusted EBIT by 2020 © Outotec – All rights reserved
Slide 3: My first year at Outotec
My first year at Outotec Positive observations Our opportunities Review of • Strong reputation with • Work closer with our organization customers customers • Leading technologies • Become more cost • Brand competitive • Expertise Meeting hundreds of • Strategy has the right • Improve execution custo
Slide 4: What we have achieved during the year
What we have achieved during the year • Updated our strategy • Prioritized our business portfolio • Created a dedicated service organization • Made key appointments to the Executive Board • Established a team at group level to lead development of customer relationships • Started to reduce fixed cost
Slide 5: Roadmap to reach 10% adjusted EBIT
5 Roadmap to reach 10% adjusted EBIT by 2020 © Outotec – All rights reserved
Slide 6: How will we achieve 10% adjusted EBIT by 2020
How will we achieve 10% adjusted EBIT by 2020 • Annual average service sales 2020: 10% growth over 10% • Grow volumes while containing Service fixed cost Volumes/fixed cost Margins • Improve margins through product competitiveness and project excellence 2017: 3-4% aEBIT 6 CMD 2017 Roadmap to reach 1
Slide 7: Our global coverage
Our global coverage R&D, sales and service 4,200 centers in employees 34 countries Deliveries to • HQ in Finland more than • Listed on NASDAQ 80 Experts Helsinki since 2006 countries from over 60 nationalities Wide supplier network with established long-term relationships 7 CMD 2017 Roadmap to reach
Slide 8: Our business on the value chain from ore to metal
Our business on the value chain from ore to metal Processing Metallurgy Exploration Development Extraction Materials handling Comminution Separation Refining Outotec Outotec Superior technologies and customer service Minerals processing Metals refining for all ore types • Pyro- and hydrometallurgy •
Slide 9: Mining & metals market outlook is improving and we are well positioned for investment growth
Mining & metals market outlook is improving and we are well positioned for investment growth Total mining & metals investments Copper investments MUSD Expansion MUSD Lack of 150 000 Sustaining Forecast 40 000 Expansion project 140 000 Sustaining Forecast visibility 130 000 35 000 120 000 Lack of 110
Slide 10: Our business is well placed to meet the fastest growing metal markets
Our business is well placed to meet the fastest growing metal markets % Share of Outotec sales 125 Annual metal consumption growth (indexed) by end product 120 28% Copper 115 Iron 11% 110 Nickel 5% 105 Aluminium 11% Zinc 2% Precious Metals 12% 100 Energy and environmental solutions* 12% 95 Ferroallo
Slide 11: We see big opportunities to grow our service business
We see big opportunities to grow our service business + Large installed base Work closer with our customers + Strong market position in services, especially in filters Increased standardization and itemization lead to shorter lead times Increase the number of service agreements + Well positioned in
Slide 12: Digitalization is increasingly embedded into everything we do
Digitalization is increasingly embedded into everything we do Our elements: Value: Smart connected equipment Asset performance and reliability Smart processes Process productivity Smart sites Process optimization Smart services Service effectiveness and efficiency Smart ways of working Efficient int
Slide 13: Our service business is already improving
Our service business is already improving Dedicated and focused Site account organization with new management in place management Prioritized business Order intake accelerating portfolio 13 CMD 2017 Roadmap to reach 10% adjusted EBIT by 2020 © Outotec – All rights reserved
Slide 14: Opportunities to grow while containing fixed costs
Opportunities to grow while containing fixed costs Improve efficiency in customers’ processes Filters refurbishment and services Dundee Precious Metals Help customers invest in leading, sustainable technologies sulfuric acid plant Recycle water efficiently Yara paste plant Circular economy and decli
Slide 15: With prioritized business portfolio we are improving our profitability
With prioritized business portfolio we are improving our profitability • Prioritization is based on: • Market opportunities • Profitability • Ability to generate healthy service business • Business risk • We continue improving execution 15 CMD 2017 Roadmap to reach 10% adjusted EBIT by 2020 © Outote
Slide 16: We will increase outsourcing while protecting our core competences
We will increase outsourcing while protecting our core competences Product development Sales Equipment / plant delivery Services delivery More • Research center • Sales in core markets • Project • Site account • Strong • Agents in non-core management management proprietary markets • IPR-critical • F
Slide 17: Our technologies decrease customers' total cost of ownership
Our technologies decrease customers’ total cost of ownership Technologies we have recently commercialized Sustainability HIGMILL® ultrafine FeCrNi processing Modular VSFX and guides our grinding flotation units technology and R&D investments Full concentrator plants with Waste to energy plants Paste
Slide 18: China is leading the global production and consumption of base metals
China is leading the global production and consumption of base metals % of global production (2017F) 25% 40% 9% 4% bauxite mine mine mine mine Aluminum Zinc Copper Nickel 56% 40% 34% 28% In addition, China is becoming a major owner of mining assets outside China % of global consumption Aluminum Zinc
Slide 19: We are increasing our presence in China
We are increasing our presence in China Catching our opportunities in China • Localize our expertise • Create China specific products • Support the Chinese driven business outside China with strong relationships • Increase local content • Expand supply out of China 19 CMD 2017 Roadmap to reach 10% a
Slide 20: We have leading technologies but we will improve cost competitiveness
We have leading technologies but we will improve cost competitiveness Best cost country Increase BCC content sourcing (BCC) Supply chain Reduce the number of improvements suppliers to half Design to cost and Standarize components and service modules Project execution Improve risk improvement managem
Slide 21: To improve efficiency, we have five must-win battles with concrete actions
To improve efficiency, we have five must-win battles with concrete actions Product Customer focus Customer focus Service business Project excellence Our people competitiveness Examples of Redesign account Refocuse service Shift supply to Develop risk and Increase job actions management s business BC
Slide 22: Our long-term financial targets are based on winning our five must-win battles
Our long-term financial targets are based on winning our five must-win battles • Sales growth faster than the market • Annual average service sales growth over 10% • Profitability (adjusted EBIT) 10% of sales by 2020 • Gearing at maximum 50% 22 CMD 2017 Roadmap to reach 10% adjusted EBIT by 2020 © O
Slide 23: Roadmap to reach 10% adjusted EBIT
23 Roadmap to reach 10% adjusted EBIT by 2020 © Outotec – All rights reserved
Slide 24: Outotec i Eee cots mul reeou rces
Outotec i Eee cots mul reeou rces
Slide 25: At the wrap up (end of the webcast after MP&MEW presentations)
At the wrap up (end of the webcast after MP&MEW presentations) 25 CMD 2017 Roadmap to reach 10% adjusted EBIT by 2020 © Outotec – All rights reserved
Slide 26: Roadmap to reach 10% adjusted EBIT by 2020
26 Roadmap to reach 10% adjusted EBIT by 2020 © Outotec – All rights reserved