Handelsbanken Nordic Large Cap Seminar
BJÖRN ROSENGREN, PRESIDENT AND CEO
10 SEPTEMBER 2012
© Wärtsilä
This is Wärtsilä
POWER
PLANTS
SHIP POWER
SERVICES
2 © Wärtsilä
Global net sales - top 10 countries
Norway
5%
USA
5%
Dominican
Republic
5%
Turkey
China
9%
9%
4%
The Netherlands
3%
3%
South Korea
Bangladesh 3%
5%
Brazil
3 © Wärtsilä
Singapore
Net sales – emphasis on high growth areas
Forecasted GDP growth 20121
Net sales by market area 2011 (MEUR):
520
12%
1,249
30%
845
20%
Europe
Asia
The Americas
Others
1.594
38%
Forecasted GDP growth 20131
MEUR
2 500
2 000
1 500
1 000
500
Notes: 1Estimates by Citigroup Global
Markets (22 February 2012)
0
2007
2008
2009
2010
2011
Europe accounted for some 30% of Wärtsilä 2011 sales, while the rest of the world accounted for
more than 70% of the sales, offering diversification from the weak European economy
4 © Wärtsilä
Net sales by currency – small impact on profitability
Net sales by currency 2011:
Sensitivity analysis
Impact of EUR exchange rate
compared to other currencies 2012:
18%
2%
13%
EUR
68%
USD
NOK
Other currencies
80%
70%
60%
50%
40%
30%
20%
10%
0%
2007
5 © Wärtsilä
2008
2009
2010
2011
• +/- 10% (compared to Feb 2012)
would result in -/+ 4% change in net
sales
• Impact on profitability would be
marginal
Profitability
MEUR
250
16%
14%
12.8%
200
11.9%
11.0%
12.1%
11.4%
10.7%
150
11.5%
11.2%
11.1%
12%
10%
10.3%
8%
100
6%
4%
50
2%
0
0%
2008
Q1
2009
Q2
Q3
2010
2011
2012
Q4
EBIT% before non-recurring items
EBITA% before non-recurring items and intangible asset amortisation related to acquisitions
6 © Wärtsilä
EBIT%
target:
10-14%
Target markets and solutions
Flexible baseload power
generation
Oil, dual-fuel
and gas fired
power plants
7 © Wärtsilä
Grid stability
and peaking
Liquid biofuel
power plants
Industrial
self-generation
Flexible grid
stability power
plants
Solutions for
oil and gas
industry
Combined heat
& power plants
(CHP)
Pumping and
compression
applications
Order intake by application
Review period development
Total EUR 591 million (672)
MEUR
2000
1800
9%
9%
16%
Industrial
self-generation
1600
Flexible
baseload
1400
Oil & gas
Grid stability &
peaking
67%
1200
1000
800
Review period order intake by fuel in MW
600
400
Oil
39%
200
0
2008
8 © Wärtsilä
2009
2010
2011
1-6/2012
Gas
61%
Global order intake
Asia 771 (298)
Europe 19 (550)
19
110 59
Americas 425 (199)
602
58 29
Africa and Middle East 186 (440)
110
229
Flexible baseload
Industrial self-generation
Grid stability & peaking
Oil & gas
Order intake 1-6/2012: 1,401 MW (1,487)
9 © Wärtsilä
59
127
Market for gas and liquid based power plants
2011
Total market 100.8 GW
8.8%
2.0%
GE
3.3%
3.3%
Siemens
4.3%
MHI
34.6%
14.4%
Alstom
Wärtsilä
Russian
29.3%
Other gas turbines
Other combustion engines*
Market data includes all prime mover units over 5 MW and estimated output of steam turbines for combined cycles.
The data is gathered from the McCoy Power Report.
In engine technology, Wärtsilä has a leading position.
* Other combustion engines figures based partly on Wärtsilä’s own estimate.
10 © Wärtsilä
Power Plant strategy going forward
•
•
•
•
Maintain our leading position in HFO power plants
Grow strongly in large gas power plants
Grow in power plants based on renewables
Grow in oil and gas and emergency power applications
11 © Wärtsilä
Smart Power Generation
Energy
efficiency
Smart
Power
Generation
Fuel
flexibility
12 © Wärtsilä
Operational
flexibility
Shipbuilding has moved to Asia
Contracting volumes (DWT): share by region
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
0%
China
Source: Wärtsilä’s Marine Market Database
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Japan
South Korea
Other Asia
Europe
Rest of world
01.09
02.09
03.09
04.09
05.09
06.09
07.09
08.09
09.09
10.09
11.09
12.09
01.10
02.10
03.10
04.10
05.10
06.10
07.10
08.10
09.10
10.10
11.10
12.10
01.11
02.11
03.11
04.11
05.11
06.11
07.11
08.11
09.11
10.11
11.11
12.11
01.12
02.12
03.12
04.12
05.12
06.12
# of vessels
Merchant
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Offshore
Source: Clarkson Research Services
* CGT= gross tonnage compensated with workload
Cruise and Ferry
Special vessels
140
80
2
60
40
1
20
0
0
Million CGT*
Vessel order development
3 months moving average in CGT*
4
120
100
3
Order intake increased by 51%
MEUR
2000
Review period development
Total EUR 723 million (479)
1600
Merchant
32%
Offshore
43%
1200
800
Other
2%
Special
vessels
7% Cruise
& ferry
4%
400
0
2008
15 © Wärtsilä
2009
2010
2011
1-6/2012
Navy
12%
Ship Power’s focus on growth
THROUGH
OFFERING
LEADER IN
OUR STRATEGIC GOAL
To be recognised as the leading solutions provider in the marine
industry for:
16 © Wärtsilä
Efficiency
Gas and dual-fuel
solutions
Environmental
solutions
• Lifecycle solutions for ship owners and operators
• Enhanced system integration for the ship building industry
• The best product sales and delivery process for the marine industry
70 countries, 160 locations, 5000 field service experts
Installed
base
180,000 MW
17 © Wärtsilä
Wärtsilä Services global network
Widest range of offering and expertise
Wide range of expertise
18 © Wärtsilä
Engine services
Propulsion services
Electrical &
automation services
Boiler services
Environmental
services
Service agreements
Service projects
Training services
Net sales by quarter
MEUR
600
500
400
300
200
100
0
2005
Q1
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2006
Q2
Q3
2007
Q4
2008
2009
2010
2011
2012
Net sales distribution
By product, 1-6/2012
24%
By region, 2011
22%
29%
43%
14%
21%
27%
9%
Spare parts
Contracts
20 © Wärtsilä
Field service
Projects
Middle-East and Asia
Southern Europe and Africa
Northern Europe
Americas
Our strategic goal
We will:
• Maximise our market share with
our present customer base
• Constantly develop our offering
proposition with value-enhancing
solutions
• Grow by providing more service
agreements with new Ship
Power and Power Plants
deliveries
• Become our industry’s market
leader in environmental solutions
To be recognised by customers as their services
partner: competitive, trusted and easy to deal with.
21 © Wärtsilä
Market outlook
•
•
•
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Power Plants: The power generation market is
expected to remain active in 2012.
Ship Power: Full year vessel contracting
expected to be somewhat lower than in 2011.
Robust contracting activity is expected for the
offshore, gas carrier, and other specialised vessel
markets.
Services: The merchant marine segments are
still expected to be under pressure, as
overcapacity in the market continues to impact
the potential for services in this area. The power
plant service market is expected to develop
steadily.
Prospects for 2012 reiterated
Wärtsilä expects its net
sales for 2012 to grow by
5-10% and its operational
profitability (EBIT% before
non-recurring items) to be
10-11%.
23 © Wärtsilä
IR Contact:
Pauliina Tennilä
Director, Investor Relations
Tel. +358 (0) 40 570 5530
E-mail: pauliina.tennila@wartsila.com