Ratos Ab Class A · OMXSTO:RATO_A
Ratos Ab Class A — DIAB — Investor Day (March 2013)
26 slides from Ratos Ab Class A's investor day presentation, Mar 14, 2013
Slide 1: DIAB
DIAB High-performance core materials and sandwich composite solutions Lennart Hagelqvist, CEO Ratos’s Capital Market Day 2013-03-14
Slide 2: Introduction to DIAB, Development 2010-2012, Actions taken and outlook
• Introduction to DIAB • Development 2010-2012 • Actions taken and outlook 2
Slide 3: What is the sandwich composite concept?
What is the sandwich composite concept? 3
Slide 4: Benefits of sandwich composites
Benefits of sandwich composites • Light & strong – Reduced weight and increased stiffness while still maintaining the strength • Freedom of design – Freedom to adapt both form and function to specific application needs • Improved production, performance and productivity – Excellent strength-to-weigh
Slide 5: Broad range of applications
Broad range of applications • Wind power • Industry – Blades – Sub sea – Nacelles – Buildings • Marine – Ice hockey sticks – Pleasure boats & mega yachts – LNG tankers – Marine vessels (coast guard etc.) – ……. – Commercial (ferries, fishing & supply • Aero boats, rescue boats etc.) – Commercial airl
Slide 6: DIAB
DIAB Complete offering in core materials • Leader in PVC core material • Balsa supply as complement • Unique (PES) product for aerospace • PET-offering Unique in-house competence: • Customer technical support in design and manufacturing processes • Market & application development • Sandwich constru
Slide 7: Global reach
Global reach Italy Sweden Lithuania USA China Ecuador 7
Slide 8: Business mix 2012
Business mix 2012 By customer segment By geography Americas "TIA" and "CCG" 24% 21% 45% Wind 44% Europe 31% 35% Marine Asia Pacific ”TIA” – Transportation, Industry & Aerospace ”CCG” – Composite Consulting Group 8
Slide 9: Introduction to DIAB, Development 2010-2012, Actions taken and outlook
• Introduction to DIAB • Development 2010-2012 • Actions taken and outlook 9
Slide 10: DIAB's financial development 2003-2012
DIAB’s financial development 2003-2012 Revenue (MSEK) EBITDA* (MSEK) 1 500 1 414 350 1 354 1 396 1 322 1 205 1 219 300 1 003 250 1 000 918 759 200 658 150 500 100 50 0 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 EBITDA* (MSEK) 94 122 141 297 309 297 245 275 125 14 *Excluding Extraordinary it
Slide 11: Sales development 2010-2012
Sales development 2010-2012 1 396 (MSEK) 1 003 -411 +18 2010 Wind China Other 2012 11
Slide 12: What happened in China?
What happened in China? 1. Market driven volume decline • Governmental directives and quality issues have temporarily, but significantly, decreased the wind installations in China • Inventory reductions in the value chain 2. Fierce price competition during a period of overcapacity • Decreased demand
Slide 13: Introduction to DIAB, Development 2010-2012, Actions taken and outlook
• Introduction to DIAB • Development 2010-2012 • Actions taken and outlook 13
Slide 14: DIAB's focus
DIAB’s focus • Cost reductions to maintain competitiveness: • Fixed cost savings of 130 MSEK • Reduce Working Capital with 80 MSEK • Improved production efficiency • Secure profitability in China also on current market price level • Secure the capabilities required for growth: • Maintain global foot
Slide 15: Summary of cost savings
Summary of cost savings 1. Resized production capacity 2. Restructuring of labor intensive Run rate savings of operations to lower cost countries ~100 MSEK fully implemented by 3. Reduction of supply chain costs Q4 2013. Additional ~30 MSEK 4. Increased organizational efficiency and fully implemente
Slide 16: Market outlook in Wind
Market outlook in Wind • China: Recovery likely by end of 2013 and the long term view is positive – Chinese authorities committed to wind – However, the system lacks liquidity and recovery so far has been slow • US: PTC now extended for 2013 – but so far the wind industry lacks long term commitment
Slide 17: Market outlook in Marine
Market outlook in Marine • Production of pleasure boats currently at “low-point” – recovery expected • Recovery has started in the US • Development in Europe is dependent on macro • Growth expected in Asia Pacific (from low levels) • Increased penetration of core materials is expected to continue •
Slide 18: Market outlook in TIA
Market outlook in “TIA” • Interest in composites and sandwich concept continually increasing – project pipe line is strong and growing • Success is dependent on market creation through focused sales approach • Growth prospects for coming years are strong - some highlights: • LNG tankers • Aerospace
Slide 19: Summary
Summary • DIAB is well positioned in a long term attractive market • Downturn in 2010-2012 due to the turbulent wind market in China • Short term focus on cost reductions with a target to reach break-even on EBITA in 2013 • Growth expected in 2014 and thereafter based upon underlying market prospect
Slide 20: Thank you for your attention!
Thank you for your attention! 20
Slide 21: DIAB
DIAB Henrik Blomé 14 March 2013 1
Slide 22: Ratos's investment in DIAB
Ratos´s investment in DIAB 96% ownership - Initial investment of 48% from 2001 - 4% ownership with DIAB’s Management and Board of Directors Total net investment of ~ SEK 750m + ~ SEK 710m investments in 2001-2008 + ~ SEK 480m add-on investment in 2009-2010 + ~ SEK 170m in capital contributions d
Slide 23: View on DIAB's situation
View on DIAB’s situation 2011-2012 has deviated from investment hypothesis - Chinese market turbulence and competitive dynamics - DIAB was geared for growth Manageable, also in a challenging market - Cost reductions are being executed - TIA & Marine developing well - Strong foundation with leadi
Slide 24: Ratos's investment case for DIAB
Ratos´s investment case for DIAB Current Focus – Long-term attractions 1. Support required cost adaption 2. Support continued growth in TIA-segments 3. Provide financial means to handle market turbulence 4. Stay close to market in order to assess potential structural opportunities 4
Slide 25: Ratos's investment case for DIAB
Ratos´s investment case for DIAB Current Focus – Long-term attractions Several drivers of organic growth - Growing customer applications - Continued growing penetration of composites - New applications - Asia Strong fundamentals for profitability improvement - Restructuring initiatives - Attract
Slide 26: Ratos
RATS