Alstom Sa · EURONEXT:ALO
Alstom Sa — Investor Day (February 2013)
32 slides from Alstom Sa's investor day presentation, Feb 28, 2013
Slide 1: Alstom Grid Analyst Day
Alstom Grid Analyst Day Grégoire Poux-Guillaume Nantes 28th February 2013 GRID
Slide 2: Agenda
Agenda I. Grid within Alstom II. Growing but challenging market III. Grid 3 strategic priorities IV. Focus on HVDC V. Focus on Smart Grid VI. Conclusion P2 2
Slide 3: Grid successfully integrated within ALSTOM
Grid successfully integrated within ALSTOM THERMAL RENEWABLE POWER GRID POWER • Boost local presence of • Overheads cost • Optimised AC and DC solutions Grid Services leveraging synergies for wind farms Thermal Services sites • Use of Global Power • Smart Grid solutions for • GCB and e Bop offering
Slide 4: Alstom Grid Scope
Alstom Grid Scope What we do • Transformers and Switchgear for HV, and associated service • Automation and Network Management for HV, MV and Smart Cities • Power Electronics (HVDC, FACTS) • EPC to sell products What we don’t do • Transformers and Switchgear for MV • LV products • EPC for the sake of
Slide 5: Orders progressing – Book to Bill > 1
Orders progressing – Book to Bill > 1 Orders (€ million) • Good dynamics on order intake +18% 4,003 • H1 Book to Bill of 1.2 3,434 1,853 2,180 • 2 HVDC projects booked LTM FY FY H1 H1 2010/11* 2011/12 2011/12 2012/13 − ca. €250m South West Link in Dec ‘11 − ca. €400m Champa in Aug ‘12 Sales (€ milli
Slide 6: Margin resilient despite difficult market conditions
Margin resilient despite difficult market conditions Income From Operation (€ million and % of sales) 6.0% 6.2% 6.1% 5.8% • Performance driven by strong execution and cost optimisation +6% • Ramp-up of sales key to support performance improvement 218 248 107 113 FY* FY H1 H1 2010/11 2011/12 2011/12
Slide 7: Orders mix shifting towards more HVDC and Smart Grid
Orders mix shifting towards more HVDC and Smart Grid Loose Products Turnkey & Service HVDC & FACTS Smart Grid (c) +10% 1.9 -1% 1.7 1.6 1.4 1.4 1.3 +31% +7% 0.7 0.5 0.5 0.5 0.3 0.2 10/11 (a) 11/12 12/13 (b) 10/11 (a) 11/12 12/13 (b) 10/11 (a) 11/12 12/13 (b) 10/11 (a) 11/12 12/13 (b) • Significant HV
Slide 8: Industrial footprint and orders balanced
Industrial footprint and orders balanced Americas 13 Manufacturing & Engineering sites 1 R&D Technology centre 20% of global order intake Europe Asia 40 Manufacturing & Engineering sites 22 Manufacturing & Engineering sites 3 R&D Technology centres 1 R&D Technology centre 30% of glob
Slide 9: Agenda
Agenda I. Grid within Alstom II. Growing but challenging market III. Grid 3 strategic priorities IV. Focus on HVDC V. Focus on Smart Grid VI. Conclusion P9 9
Slide 10: Solid long term market fundamentals
Solid long term market fundamentals Global Segment Long term Drivers Importance Power Impact on Grid Market HV Products Smart Grid Service Electronics Electricity • Main driver for Grid expansion, new Consumption & substations and related HV products Generation • Challenge to improve Energy efficien
Slide 11: HVDC and Smart Grid as key market growth drivers
HVDC and Smart Grid as key market growth drivers In € billion CAGR 12/13 – 15/16 60 €40 billion market with 3% CAGR 50 • Growth driven by HVDC and Smart Grid 11 % Smart Grid • Conventional AC flat 40 Service 4% • Service and Industrial growing faster HVDC 28 % 30 Alstom Grid Scope Smart Grid address
Slide 12: AC price stabilising - at low level
AC price stabilising - at low level Grid market price evolution 100 95 90 • Price erosion stabilizing at low level 85 80 • Price pressure maintained by 75 − Over-capacity in AC products 70 − EPC contractors packaging 65 2009 2010 2011 2012 third party equipment Example: Koweit 400kV GIS S/S • Some d
Slide 13: Agenda
Agenda I. Grid within Alstom II. Growing but challenging market III. Grid 3 strategic priorities IV. Focus on HVDC V. Focus on Smart Grid VI. Conclusion P 13 13
Slide 14: Strategic priorities 1: Focus on high value segments and growth drivers
Strategic priorities 1 Focus on high value segments and growth drivers HVDC • Growing market with high barriers to entry • 2 key technologies: LCC and VSC • Major recent commercial successes in 800kV LCC and VSC • More to come? Smart Grid • 3 priorities − Control Rooms (market leader) − Smart Power
Slide 15: Strategic priorities 1: Focus on high value segments and growth drivers
Strategic priorities 1 Focus on high value segments and growth drivers Service • Achieve double digit growth without sacrificing margins • 4 key axes: − geographical coverage − Industry & Power generation − third party services − asset management Industry / Oil & Gas • Reinforce our positioning • De
Slide 16: … while remaining a key player on AC business
… while remaining a key player on AC business 2012 2012 Commercial successes R&D successes • Abu Dhabi –TRANSCO: 2 GIS substations of 220 kV • Portfolio extended with GIS 420 kV Single and 400 kV chamber and AIS dead tank 362 kV • India – Power Grid: world’s first 1,200 kV optical • World’s largest
Slide 17: Strategic priorities 2: Key partnerships to support and expand growth focus
Strategic priorities 2 Key partnerships to support and expand growth focus HVDC Smart Grid • China: commercial and technology • Cisco (USA): communications and partnership with Shandong (SGCC) data protection solutions for for 800/1,100 kV DC Transformers digital substations (Sept 2012) • Korea: 49/
Slide 18: Strategic priorities 3: Cost optimisation to offset price pressure in AC
Strategic priorities 3 Cost optimisation to offset price pressure in AC Site redeployments Product Cost Optimisation • Adapt to market • Double digit % cost reduction – 4 sites being closed – Redesign-to-cost on HV Products (Mexico, Australia, China x 2) – New product introduction – Rationalisation
Slide 19: Agenda
Agenda I. Grid within Alstom II. Growing but challenging market III. Grid 3 strategic priorities IV. Focus on HVDC V. Focus on Smart Grid VI. Conclusion P 19 19
Slide 20: HVDC market to triple in 10 years
HVDC market to triple in 10 years HVDC market Market Trends In € billion 9 • Market divided into 2 technologies − Line-commutated converters (LCC) − Voltage-sourced converters (VSC) 3 • Solid key drivers: bulk power transfers, renewable energy integration, Supergrid development 2011/12 2020/21e • In
Slide 21: Alstom Grid HVDC: >30 GW installed, 50 years of experience
Alstom Grid HVDC > 30 GW installed, 50 years of experience Dürnrohr: 380 MW IFA2000 (Fra/UK): 2,000 MW Konti-Skan 1: 380 MW China-Russia: 750 MW SACOI: 380 MW Lingbao II: 750 MW South West VSC: 2x720 MW 3G-Shanghai II: 3,000 MW Nindong-Shandong: 4,000 MW Cheju-Haenam: 300 MW Cheju-Jindo: 400 MW McNe
Slide 22: Alstom Grid HVDC: Main projects in execution
Alstom Grid HVDC Main projects in execution Porto • Rio Madeira (Brazil): the longest DC line in the world (2,375 km) Araraquara Velho − Technology: LCC Sao − 600 kV - 3,150 MW Paulo − Contract award: 2009 – Completion 2013 Kurukshetra • Champa (India): a reference in 800 kV − Technology: LCC Champa
Slide 23: Alstom Grid HVDC: Ambition: sustainable 20+% market share
Alstom Grid HVDC Ambition: sustainable 20+% market share • Target ~€2.5 billion orders over the next 3 years − Break into offshore wind (Germany, Baltic Sea) − Leverage partnerships for entry in Korea, China and Russia − Build talent base: R&D, Engineering, Project Management • Be at the edge of inn
Slide 24: Agenda
Agenda I. Grid within Alstom II. Growing but challenging market III. Grid 3 strategic priorities IV. Focus on HVDC V. Focus on Smart Grid VI. Conclusion P 24 24
Slide 25: Smart Grid market to double in 10 years
Smart Grid market to double in 10 years Global Smart Grid market (in € billion) 39 • € 20 billion market with T&D contributing to the bulk of it • Market driven by 20 − Renewable integration (intermittency) Homes − Need to reduce consumption peaks Buildings − Increasing distributed generation T&D −
Slide 26: Alstom Grid Smartgrid: Present across the value chain
Alstom Grid Smartgrid Present across the value chain Smart Grid T&D market (in € billion) CAGR 21 9% 7% ALSTOM Grid Segment Presence 4% Control Rooms 10 Control Rooms 4% Telecom Telecom SAS-DA 16% Smart Meters SAS-DA Smart Meters Power Electronics 12% Power Electronics 2012 2020e Full ALSTOM offerin
Slide 27: Alstom Grid Smartgrid: Leader in Control Room applications
Alstom Grid Smartgrid Leader in Control Room applications • # 1 in Control Rooms • Over €40 billion transactions per year on our systems • > 70% of USA deregulated markets Online Stability Renewable Integration Integrated DMS / Smart-Cities Demand Response Continuous integration of new control room
Slide 28: Alstom Grid Smartgrid: Deploying its solutions all across the Grid
Alstom Grid Smartgrid Deploying its solutions all across the Grid • Leading innovator in automation and storage for the grid • > 1,000 HV substations equipped Digital substation Energy Storage Distribution Automation Extension towards new distribution automation and storage P 28 28
Slide 29: Alstom Grid Smartgrid: Joint innovation through strategic demonstrations
Alstom Grid Smartgrid Joint innovation through strategic demonstrations EU WPD DC breakers, WAMS EU Distribution (Twenties1) Automation (Falcon) ESB DERMS (Grid4EU) UKPN Fast Charging DC Distribution EU (Green e-motion) Automation (FPP) EMBIX (Cooperate) ERDF Twenties + DERMSERDF (NiceGrid) ELIA (WP
Slide 30: Alstom Grid Smartgrid: Ambition: double digit growth
Alstom Grid Smartgrid Ambition: double digit growth • End-to-end offering for Transmission & Distribution • Transform our 30 R&D demonstrators into large scale commercial projects • Consolidate key markets − USA: Demand Response, integration of renewable energies − Europe: integration of renewable e
Slide 31: Agenda
Agenda I. Grid within Alstom II. Growing but challenging market III. Grid 3 strategic priorities IV. Focus on HVDC V. Focus on Smart Grid VI. Conclusion P 31 31
Slide 32: Conclusion
Conclusion Well positioned to capture growth • Strong technology offering • Significant R&D spending • Key partnerships in place Focus on operational excellence • Optimise footprint • Cut overheads • Competitiveness through new or re-designed products • Extract cost savings in sourcing, quality, pro