Wärtsilä Corporation. Interim Report January-September 2006 Ole Johansson, President & CEO. 31 October Wärtsilä

Transcription

1 Wärtsilä Corporation Interim Report January-September 26 Ole Johansson, President & CEO 31 October 26

2 Highlights Q3/26 Strong order intake continued (+25%) Net sales +26% Operating income +29% Strong cash flow Strong balance sheet enables extraordinary dividend 2

3 Key figures Net sales by business Q3/26 Ship Power 24.% (26.) Power Plants 35.8% (29.) MEUR Q3/6 Q3/5 25 Net sales ,52.3 Operating income Income before taxes Earnings/share, EUR Services 4.7% (45.) 3

4 Key figures MEUR Net sales Order intake Order book % 55.4% 16.4% % 22.2% 35.5% 1, ,95.7 2, % 24.8% 93.9% 4,18.2 Q3/5 Q3/6 Q3/5 Q3/ Services Power Plants Ship Power 4

5 Order book distribution MEUR Delivery current year Delivery next year Delivery next year

6 Delivered engine megawatts from own factories MW /26 Power Plants Ship Power Full-year estimate 6

7 Cash flow MEUR 1-9/26 1-9/25 25 Cash flow from operating activities Cash flow from investing activities Cash flow from financing activities Cash and cash equivalents at end of period

8 Solvency and gearing % 5 Solvency,6 Gearing 45 4,5 35 3,4 25,3 2 15,2 1 5, / /6 NOTE: according to FAS, 24- IFRS Convertible subordinated debentures treated as equity 8

9 Business review

10 Vessel orders, # of vessels Tankers Bulk carriers Containers Others 3 months moving average dwt 16 3 Volume [million DWT] # of vessels Source: Based on data from Clarkson Research Studies 1

11 Vessel orders - other vessels, # of vessels LNG carriers LPG carriers Reefers Other dry > 5, dwt Offshore & other Cruise vessels Ro-Ro ferries 3 months moving average dwt # of vessels Volume [Million DWT] Source: Based on data from Clarkson Research Studies 11

12 Net sales of Ship Power by vessel type Tankers 11% Bulk carriers 4% Container ships 14% Cruise & Ferry 15% General cargo 1% LNG 3% 2 Special vessels & other 16% Offshore 27% /26 Tankers Bulk carriers Container ships Others 12

13 Wärtsilä Ship Power Ship Power net sales MEUR Q3/6 Q3/5 Change Net sales % Order intake % Order book* 2,8.7 1, % 24.% Strong order intake continued Offshore segment dominant LNG, cruise & tankers also active of total net sales * End of period 13

14 The market position of Wärtsilä s marine engines Q3/26 Own production Production by licensees Own production Medium-speed main engines Low-speed main engines Medium-speed auxiliary engines Wärtsilä 5% (48) Wärtsilä 17% (21) Wärtsilä 7% (9) Comp. 3 4%(3) Others 13%(14) Comp. 1 14%(14) Comp. 2 23%(24) Comp. 1 79%(76) Others 93%(91) Total market volume last 12 months: 9,6 MW (7,96) Total market volume last 12 months: 21,9 MW (18,683) Total market volume last 12 months: 6,7 MW (4,57) Wärtsilä s own calculation is based on: Lloyd s Register Fairplay, Clarkson s Research Studies and BRL Shipping Consultants. Market shares based on installed power, numbers in brackets are from Q2/6. The total market is based on the volume of the last 12 months. Numbers in brackets reflect the volume of the last 12 months at the end of the previous quarter. 14

15 Wärtsilä Services Services net sales MEUR Q3/6 Q3/5 Change Net sales % Personnel* % 4.7% 8 new O&M agreements signed in among others India and Brazil Growth 17.7% 1-9/26, organic growth 11.8% of total net sales * End of period 15

16 Services % % Services growth per Q Services share of sales Q1/3 Q2/3 Q3/3 Q4/3 Q1/4 Q2/4 Q3/4 Q4/4 Q1/5 Q2/5 Q3/5 Q4/5 Q1/6 Q2/6 Q3/6 16

17 Target markets per fuel MW HFO 1-6 MW LFO MW GAS MW Wärtsilä s market share 8.1% (7.8) 23.% (8.7) 33.8% (44.2) Note I: Wärtsilä s gas power plant target markets have changed since Wärtsilä stopped manufacturing and selling high speed engines (power range < 3,5 MW) Note II: The 26 LFO figure includes liquid biofuels. Source: Diesel & gas turbine worldwide, June 25-May 26 17

18 Gas power plant market MW Wärtsilä 8.1% (7.8) Gas turbines 9,44 MW Market potential for Wärtsilä Rec.engines 1,327 MW Wärtsilä 63.5% 3 26 HFO 1-6 MW LFO MW GAS MW Note I: Wärtsilä s gas power plant target markets have changed since Wärtsilä stopped manufacturing and selling high speed engines (power range < 3,5 MW) Note II: The 26 LFO figure includes Liquid Biofuels. Source: Diesel & gas turbine worldwide, June 25-May 26 18

19 Power Plants order intake by segment Order intake by segment, MEUR Order intake by segment, MW / /26 Industrial self generation Grid base load Industrial self generation Grid base load Ancilliary services Ancilliary services 19

20 Power Plants - order intake 1-9/26: 1511 MW (1223) Europe 239 (113) Asia 249 (574) Americas 399 (295) 63 (14) 176 (9) 159 (395) 9 (18) 17 (9) 229 (286) Africa and Middle East 624 (241) Gas Oil 315 (72) 39 (169) 2

21 Wärtsilä Power Plants Power Plants net sales MEUR Q3/6 Q3/5 Change Net sales % Order intake % Order book* % 35.8% of total net sales High activity in both oil & gas power plants Gas power plants order intake was strong Largest orders from Tanzania, USA & Venezuela * End of period 21

22 Wärtsilä s holdings Wärtsilä owns 2.% (4.7) of Assa Abloy shares The holding s market value EUR 16.7 million (3 September 26) Wärtsilä s holding in Oy Ovako Ab 26.5% during review period Balance sheet value of the holding EUR million Wärtsilä has recorded EUR 18.1 million as associated company result for the period 1-9/26 22

23 Wärtsilä s holdings In July Wärtsilä, SKF and Rautaruukki signed an agreement to sell the operating companies owned by Oy Ovako Ab. The transaction is subject to regulatory approvals and expected to close in Q4/6. Tax-free capital gain of approx. EUR 49 million at closing. Cash flow implications Cash payment Q4/6 appr. EUR 14 million July 28 EUR 4 million Vendor note, within 3-6 years EUR 29 million Total appr. EUR 173 million 23

24 Market outlook 26 Ship Power High activity continues in all energy related segments Power Plants High ordering activity in both oil & gas fueled power plants expected to continue Demand distributed geographically evenly 24

25 Wärtsilä s prospects in 26 and 27 Forecast for 26 Demand in the ship power and energy markets looks likely to remain favorable for Wärtsilä for at least the following six months. Based on the strong order book Wärtsilä s net sales are expected to grow this year over 2%. The profitability level reached in 25 will remain. Forecast for 27 Wärtsilä s net sales for 27 are estimated to grow by approximately 1-15% compared to net sales 26 based on the strong order book and the lively ordering activity. The capacity increase, available from mid-27, will make further growth possible in

26 Thank you! 26