Slide 1: Wärtsilä Corporation Interim Report January-September 2017
WÄRTSILÄ CORPORATION INTERIM REPORT JANUARY-SEPTEMBER 2017 25 October 2017 Jaakko Eskola, President & CEO 1 © Wärtsilä PUBLIC 25 October 2017 Q3 Result presentation 2017
Slide 2: Highlights Q3/2017
Highlights Q3/2017 • Order intake EUR 1,354 million, +19% • Net sales EUR 1,178 million, +9% • Book-to-bill 1.15 (1.06) • Comparable operating result EUR 135 million (123), 11.4% of net sales (11.4) • Earnings per share EUR 0.43 (0.43) • Cash flow from operating activities EUR 150 million (189) • Or
Slide 3: Strong development in order intake
Strong development in order intake MEUR 5 500 5 000 Third quarter development 4 500 MEUR 4 000 1 600 1,354 3 500 1 400 1,139 19% 3 000 1 200 5% Services 2 500 1 000 2 000 800 Marine 35% Solutions 1 500 600 1 000 400 Energy 26% Solutions 500 200 0 0 2013 2014 2015 2016 2017 Q3/2016 Q3/2017 Q1-Q3 Q4 3
Slide 4: Net sales supported by power plant deliveries
Net sales supported by power plant deliveries MEUR 5 500 5 000 Third quarter development 4 500 MEUR 4 000 1 600 3 500 1 400 3 000 9% 1,178 1 200 1,079 2 500 3% Services 1 000 2 000 800 Marine -16% Solutions 1 500 600 1 000 400 Energy 83% Solutions 500 200 0 0 2013 2014 2015 2016 2017 Q3/2016 Q3/2017
Slide 5: Net sales by business 1-9/2017
Net sales by business 1-9/2017 Services Marine Solutions 45% (48) 27% (36) Energy Solutions 28% (16) 5 © Wärtsilä PUBLIC 25 October 2017 Q3 Result presentation 2017
Slide 6: Book-to-bill
Book-to-bill MEUR 5 500 1,4 5 000 1.19 1,2 4 500 1.03 1.05 1.06 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 2013 2014 2015 2016 1-9/2017 Order intake Net sales Book-to-bill 6 © Wärtsilä PUBLIC 25 October 2017 Q3 Result presentation 2017
Slide 7: Order book distribution
Order book distribution MEUR 3 500 3 000 2 500 2 000 1 500 1 000 500 0 30.9.2016 30.9.2017 Delivery current year Delivery next year Delivery later than next year 7 © Wärtsilä PUBLIC 25 October 2017 Q3 Result presentation 2017
Slide 8: Operating result supported by changes in timing of deliveries
Operating result supported by changes in timing of deliveries MEUR 700 14% 12.2% 12.1% 11.9% Review period development 600 12% 11.2% MEUR 400 14% 500 10% 350 12% 400 8% 300 10.2% 10.0% 10% 250 300 6% 8% 200 6% 200 4% 150 4% 100 100 2% 50 2% 0 0% 0 0% 2013 2014 2015 2016 1-9/2016 1-9/2017 Comparable
Slide 9: Services
SERVICES 9 © Wärtsilä PUBLIC 25 October 2017 Q3 Result presentation 2017
Slide 10: Services' sales affected by challenges in offshore and low volumes from service projects
SERVICES Services’ sales affected by challenges in offshore and low volumes from service projects MEUR 2 400 2 200 Third quarter development 2 000 MEUR 1 800 700 1 600 1 400 600 512 526 1 200 3% 500 1 000 400 800 300 600 200 400 200 100 0 0 2013 2014 2015 2016 2017 Q3/2016 Q3/2017 Q1-Q3 Q4 10 © Wärt
Slide 11: Net sales distribution 1-9/2017
SERVICES Net sales distribution 1-9/2017 By product area By segment Special vessels 7% (8) Offshore Field service 8% (9) 22% (23) Navy 8% (8) Spare parts Power plants 50% (50) 39% (38) Agreements 17% (15) Merchant 23% (24) Projects Cruise & ferry 10% (11) 15% (13) Total EUR 1,561 million (1,554) 11
Slide 12: Installed base covered by service agreements
SERVICES Installed base covered by service agreements 20 000 30% 18 000 25% 16 000 14 000 20% 12 000 MW 10 000 15% 8 000 10% 6 000 4 000 5% 2 000 0 0% 2009 2010 2011 2012 2013 2014 2015 2016 1-9/2017 MW under agreement – Energy Solutions MW under agreement – Marine Solutions % of Energy Solutions’ i
Slide 13: Ensuring certainty of operations and predictability of GasLog's LNG carriers
Ensuring certainty of operations and predictability of GasLog’s LNG carriers • A service agreement covering eight LNG carriers expands the cooperation between Wärtsilä and GasLog • Wärtsilä’s digital services allows for remote troubleshooting and tuning of engines as well as software updates • Apply
Slide 14: Energy Solutions
ENERGY SOLUTIONS 14 © Wärtsilä PUBLIC 25 October 2017 Q3 Result presentation 2017
Slide 15: Quotation activity by fuel type
ENERGY SOLUTIONS Quotation activity by fuel type MW 60 000 50 000 40 000 Multi-fuel 30 000 Gas Liquid fuel 20 000 10 000 0 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Q1/2016 Q2/2016 Q3/2016 Q4/2016 Q1/2017 Q2/2017 Q3/2017 Calculated on a 12 months rolling basis 15 © Wärtsilä PUBLIC 25 October 2017 Q3 R
Slide 16: Energy Solutions' order intake developing well
ENERGY SOLUTIONS Energy Solutions’ order intake developing well Review period development MEUR Total EUR 1,184 million (947) 1 800 15% Utilities 1 600 Independent 1 400 power producers 36% 49% 1 200 Industrials 1 000 800 Review period order intake 600 by fuel in MW 400 Oil Gas 51% 49% 200 0 2013 201
Slide 17: Order intake globally
ENERGY SOLUTIONS Order intake globally Europe 198 (1,049) Asia 2,031 (395) 13 8 75 110 Americas 348 (726) 1,309 714 18 329 Africa and Middle East 279 (385) Utilities IPP’s (Independent 134 95 Power Producers) Industrials 50 Order intake 1-9/2017: 2,856 MW (2,555) 17 © Wärtsilä PUBLIC 25 October 2017
Slide 18: Contributing to the development of sustainable societies
Contributing to the development of sustainable societies • Wärtsilä will supply its third LNG receiving terminal to be located in Hamina, Finland • The port of Hamina will be the first LNG receiving terminal in Finland connected to Finnish gas grid, offering security of supply to gas customers • The
Slide 19: Market for gas and liquid fuel power plants, <500 MW
ENERGY SOLUTIONS Market for gas and liquid fuel power plants, <500 MW Other GT’s 4% (4) Wärtsilä 14% (12) GE 30% (31) MHI 14% (15) Siemens 19% (24) Ansaldo 19% (15) <500 MW market volume last 12 months: 24.8 GW (28.4) Total market volume last 12 months: 54.6 GW (58.0) Market shares are calculated on
Slide 20: Marine Solutions
MARINE SOLUTIONS 20 © Wärtsilä PUBLIC 25 October 2017 Q3 Result presentation 2017
Slide 21: Improving market conditions supported vessel contracting
MARINE SOLUTIONS Improving market conditions supported vessel contracting 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 01.09 03.09 05.09 07.09 09.09 11.09 01.10 03.1
Slide 22: Marine Solutions' order intake supported by favourable contracting mix
MARINE SOLUTIONS Marine Solutions’ order intake supported by favourable contracting mix MEUR 1 800 Review period development Total EUR 1,112 million (1,028) 1 500 Offshore 3% Special vessels 1 200 8% Gas carriers 26% 900 Cruise 31% 600 300 Traditional merchant 17% 0 Ferry 2013 2014 2015 2016 2017 Ot
Slide 23: Market position of Wärtsilä's marine engines
MARINE SOLUTIONS Market position of Wärtsilä’s marine engines Medium-speed main engines Auxiliary engines Others Wärtsilä 20% (17) 13% (8) Caterpillar Wärtsilä 10% (13) 43% (40) Others 87% (92) MAN D&T 27% (30) Total market volume last 12 months: Total market volume last 12 months: 2,982 MW (3,065)
Slide 24: Developing technologies that enable a Smart Marine future
Developing technologies that enable Kuva a Smart Marine future pitää • Efficient and reliable remote control and monitoring capabilities are central to vaihtaa, the enablement of intelligent shipping • Wärtsilä recently successfully tested bonny the remote control of ship operations using standard b
Slide 25: Financials
FINANCIALS 25 © Wärtsilä PUBLIC 25 October 2017 Q3 Result presentation 2017
Slide 26: Cash flow from operating activities affected by increased receivables
FINANCIALS Cash flow from operating activities affected by increased receivables MEUR 700 600 Review period development MEUR 400 500 350 400 300 250 300 200 200 150 100 100 50 0 0 2013 2014 2015 2016 1-9/2016 1-9/2017 26 © Wärtsilä PUBLIC 25 October 2017 Q3 Result presentation 2017
Slide 27: Working capital
FINANCIALS Working capital MEUR 1 600 25% 1 400 Review period development 20% MEUR 1 200 1 600 25% 1 000 1 400 15% 20% 1 200 800 10.8% 10.2% 1 000 15% 13.1%* 10% 600 543 800 11.2%* 6.8% 490 658 10% 5.2% 600 540 400 313 5% 251 400 5% 200 200 0 0% 0 0% 2013 2014 2015 2016 30.9.2016 30.9.2017 Working c
Slide 28: Gearing
FINANCIALS Gearing 0,50 Review period development 0,40 0,50 0,30 0,40 0,30 0,20 0,20 0,10 0,10 0,00 0,00 2013 2014 2015 2016 30.9.2016 30.9.2017 28 © Wärtsilä PUBLIC 25 October 2017 Q3 Result presentation 2017
Slide 29: Prospects for 2017 unchanged
Setti 1 Setti 1 Prospects for 2017 unchanged The overall development 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 • Good in Energy Solutions • Solid in Marine Solutio
Slide 30: Thank you
THANK YOU Further information: Natalia Valtasaari Director, Investor & Media Relations Tel. +358 (0) 10 709 5637 E-mail: natalia.valtasaari@wartsila.com 30 © Wärtsilä PUBLIC 25 October 2017 Q3 Result presentation 2017