Wartsila Oyj Abp · OMXHEX:WRT1V

Wartsila Oyj Abp — Wärtsilä — Non-Deal Roadshow (April 2024)

104 slides from Wartsila Oyj Abp's roadshow presentation, April 2024

Slide 1: Shaping the decarbonisation of marine and energy
Wärtsilä Shaping the decarbonisation of marine and energy Roadshow presentation April 2024 1 ©
Slide 2: Wärtsilä – Shaping the decarbonisation of marine and energy
Wärtsilä – Shaping the decarbonisation of marine and energy Wärtsilä simplified the Marine Energy Committed to financial targets Group structure from 1st Our offering of engines, propulsion We support the change towards a Net sales January 2024 onwards systems, hybrid technologies and future where e
Slide 3: Market fundamentals
Market fundamentals Marine will move with unprecedented speed towards decarbonisation Policies & regulations Technology Connectivity & data ▪ IMO target/ EU Regulations ▪ Carbon neutral and zero ▪ Vessels as data pools ▪ Access to capital carbon fuels ▪ Optimisation solutions ▪ Cost of carbon ▪ Carb
Slide 4: Our value creation potential is based on two strategic themes
Our value creation Transform – Perform – potential is based attractive growth clear path for opportunities at operational on two strategic the center of the improvements themes decarbonisation transformation and increased profitability 4 ©
Slide 5: Significant milestones reached in strategy execution
Significant milestones reached in strategy execution 1) 2023 vs. 2021 net sales Transform Perform ▪ Market leader in: ▪ Good growth in service agreements by leveraging digital solutions − 4-stroke medium speed main engines − Engine power plants ▪ Improved quality of new build order book margins − Ma
Slide 6: Transform – attractive growth opportunities
Transform – attractive growth opportunities at the center of the decarbonisation transformation 6 ©
Slide 7: Strong market fundamentals will support profitable growth in Marine business
Strong market fundamentals and the decarbonisation transformation will support profitable growth in Marine business Key target segments Decarbonisation drivers Annual newbuild contracting of 4-stroke medium speed main engine- powered units (GW)1); CAGR ▪ IMO MEPC 80 has adopted a revised strategy to
Slide 8: Wärtsilä is a global technology and service leader in marine decarbonisation
Wärtsilä is a global technology and service leader in shaping the decarbonisation of marine #1 #1 Pioneer +60% of net sales3) Industry leading medium Industry leading hybrid Pioneer in carbon capture & Global services network to speed engine offering solutions storage ensure maximum uptime & fuel ef
Slide 9: Renewables and balancing power will support growth in Energy business
The increasing share of renewables and need for balancing power will support profitable growth in Energy business Thermal balancing Energy storage Market drivers Addressable market Addressable market GW; CAGR GWh; CAGR ▪ Thermal balancing market is expected to grow +4X by 2030 driven by accelerating
Slide 10: Global leader in engine power plants; Energy Storage profitable
Wärtsilä is a global leader in engine power plants. Energy Storage & Optimisation has grown ~3X since 2021 and is now profitable #1 #1-5 +40% of net sales2) Industry leading engine power plants1) Top 5 in energy storage Global services network to ensure maximum uptime & fuel efficiency ▪ Superior op
Slide 11: Strategic review of Energy Storage & Optimisation
To support accelerated profitable growth of Energy Storage & Optimisation, we have launched a strategic review of the business ▪ Energy storage market is expected to grow rapidly, addressable market to grow +3X from 2022 to 2030 ▪ Wärtsilä Energy Storage & Optimisation has grown +30X1) since the acq
Slide 12: Perform – clear path for operational improvements
Perform – clear path for operational improvements and increased profitability 12 ©
Slide 13: Services is ~50% of our net sales
Services is ~50% of our net sales with good future growth potential EUR ~3bn 26% ~90% 2023 net sales Growth in net sales since 2021 Renewal rate of service agreements 13 ©
Slide 14: Executing services strategy on the service value ladder
We continue to execute our services strategy on all steps of the service value ladder ▪ Our installed base of medium speed engines is increasing (~5% increase since 2021) ▪ 26% growth in transactional services since 2021 ▪ ~30% of installed base2) is under service agreements with further growth pote
Slide 15: Benefit from operational improvements and structural changes
Going forward we will benefit from the implemented operational improvements and structural changes Quality of revenues ▪ Improved quality of new build margins in current order book ▪ Energy order book has higher share of equipment and lower share of EPC deliveries ▪ Energy Storage & Optimisation is
Slide 16: Commitment and path to reach financial targets
Strong commitment and a clear path to reach our financial targets 12% 5% <0.5 ≥50% Operating margin Annual organic Gearing Dividend of growth earnings 16 ©
Slide 17: Drivers of >5% organic growth target
Energy transition and decarbonisation driving our >5% organic growth target LTM Q3/2023 net sales EUR 6.1bn Drivers of net sales growth1) Share of absolute growth ▪ Energy Storage & Optimisation − Fast growing demand for energy storage and power system optimisation solutions ▪ Marine newbuild driven
Slide 18: Key drivers towards 12% operating margin
Services and decarbonisation key drivers towards 12% operating margin LTM Q3/2023 operating margin 6.0%1) Drivers of improved profitability2) Share of absolute improvements ▪ Moving up the service value ladder in Marine and Energy ▪ Marine new build driven by decarbonisation ▪ Energy Engine Power Pl
Slide 19: Actively managing our business portfolio
We continue to actively manage our business portfolio Marine Systems discontinued Portfolio Business Effective 1st of January 2024 Plan to divest. Timeline subject to internal separation & turnaround ▪ Further simplification of Group structure ▪ Water & Waste ▪ Gas Solutions has limited synergies wi
Slide 20: Marine & Energy Engine Power Plants double digit profitability
Marine & Energy Engine Power Plants combined have double digit profitability. Energy Storage & Optimisation is now profitable Group simulation (LTM Q3/2023), net sales EURbn Comparable operating margin 10.5% 0.3% 8.7% 7.7% LTM Q3/2023 Operating margin 10.0% 0.1% 8.2% 6.0% LTM Q3/2023 Net sales CAGR
Slide 21: Profitability drivers
Profitability drivers + Supporting drivers + / - Uncertainties - Negative factors ▪ Continued decarbonisation in both ▪ Geopolitical tensions ▪ Wage inflation the energy and marine markets ▪ Potential trade restrictions / ▪ Good service performance trade wars ▪ Strong order book both in new ▪ Recess
Slide 22: Strong balance sheet and financial position
Strong balance sheet and financial position to support strategy execution Cash flow from operating Working capital (EURm) Gearing Solvency ratio activities (EURm) % of sales Net interest-bearing debt Net interest bearing debt % of sales (EURm) (EURm) 30% 15% 15% 14% 14% 4% 6% 23% 3% -1% 41% -2% 38%
Slide 23: The Wärtsilä Way
The Wärtsilä Way sets the scene for profitable growth. We reconfirm our financial targets 23 ©
Slide 24: Strategic priorities as key levers
The strategic priorities are the key levers to improve our performance and reach our target position 1 Excel in creating customer value We continuously evolve our understanding of, and responsiveness to, our customers to make them successful Develop high performing teams that make a difference 2 We
Slide 26: Accelerated decarbonisation targets shaping shipping
Accelerated decarbonisation targets are shaping the shipping industry and reinforcing our strategy Ambitions and checkpoints in the revised IMO GHG strategy2) In 2023, IMO strengthened GHG emission reduction % vs 2008 its GHG reduction targets, and now strives for net- 0% Vessel’s lifetime zero “by
Slide 27: Progressive switch to sustainable fuels
A progressive switch to sustainable fuels is already under way Sustainable fuel uptake scenario for net-zero in 20501) Fuel transition is under way: 49% of Total energy consumption, EJ tonnage on orderbook is set to use alternative fuels; long-term fuel mix is 15 dependent on supply of different fue
Slide 29: Fuel cost will double due to emission fees
Up to 2030, fuel cost will double due to emission fees Fuel-related costs for Handymax bulker operating in EU waters, EURm1) Multiple business drivers will add further pressure to decarbonise shipping2) 15 The transition will happen 10 under the lifetime of a vessel ~2x Upgradability is critical for
Slide 30: Cost of emissions will close fuel price gap
Cost of emissions will close the price gap between fossil and sustainable fuels; fuel selection impacts the vessel structure Fuel type Low Sulphur Liquified Methanol Ammonia Liquid Compressed Marine Fuel Oil Natural Gas @ 20°C @ -33°C Hydrogen Hydrogen Battery Rack @ 20°C @ -162°C @ -253°C @ 350bar
Slide 31: Leading position in 4-stroke medium speed engines
We maintain a leading position in 4-stroke medium speed main engines and are increasing our share in auxiliary engines 4-stroke medium speed main engines market share1) Auxiliary engines market share1) ~45% ~15% ~70% ~25% We are market leaders We are growing in in 4-stroke medium auxiliary engines,
Slide 32: Recovery in key segments grows addressable market
Recovery in our key target segments will grow our addressable market for equipment sales Newbuild ordering of 4-stroke medium speed main engine-powered ships, MW1) Wärtsilä market share, MW3) 11% CAGR Others2) 6 000 Offshore ~55% Merchant 5 000 Offshore 4 000 Passenger 3 000 Cruise ~85% 2 000 1 000
Slide 33: Hybrid-Electric LNG carrier
Hybrid-Electric will challenge 2-stroke as prime-mover for LNG carriers, enabling higher efficiency and increased cargo capacity Wärtsilä Hybrid-Electric LNG carrier Launched at Gastech in 2023 with Shell and Hudong-Zhonghua Shipbuilding 185k cbm capacity 3x 4-stroke spark-gas gensets 6% extra cargo
Slide 34: Vessel contracting forecast
Vessel contracting forecast No of ships, 2,000+ dwt/GT, Continuing accelerated fleet renewal Ship-shaped mobile offshore vessels only. Accelerating fleet renewal and supported by the fleet age profile and steady demand growth potential increased consensus over supported by gradual fuelling and techn
Slide 35: Services is more than 60% of Marine Power sales
Servicesisismore Services morethan than60% 60%of ofMarine MarinePower Powersales. sales. Wehave We have33distinct distinctrevenue revenuestreams streamscovering coveringcustomer customermaintenance maintenance Transactional Agreements Retrofit Projects % services ~60% ~30% ~10% sales1) Increasing sh
Slide 36: Moving up our service value ladder
We increase sales and profits by moving up our service value ladder From 1x1) Up to 2-3x1) Guaranteed asset Optimised performance maintenance agreement Technical management agreement AI-based Expert Insight Enhanced support agreement AI-based Expert Insight Operational support Data-driven dynamic ag
Slide 37: Expanding installed base under agreement
We expand the installed base under agreement while climbing the service value ladder Key facts Number of vessels under agreement1) Key metrics Customer benefits 700 +17% ~90% ~90% By combining AI and renewal rate2) issues resolved remotely data analytics with 600 product know-how, 500 we can increas
Slide 38: Vessel utilisation rates driving service business
Vessel utilisation rates driving Wärtsilä’s service business Cruise and passenger ferries Offshore 100 100 1 800 Using slow steaming to 90 90 1 600 manage active fleet 80 80 1 400 capacity and/or to limit MDU Utilisation, % Cruise Idle capacity, % # Laid-up OSVs 70 70 1 200 60 Passenger ferries 60 1
Slide 39: Regulations boost demand for retrofits
Tightening regulations and increasing fuel and emission cost boost demand for retrofits; we are well positioned to grow this business We enable fleet decarbonisation Success stories in 2023 48% with the most comprehensive retrofit portfolio in the industry First 4-stroke methanol of the fleet is not
Slide 40: Wärtsilä Expert Insights
Wärtsilä Expert Insights: combining data analytics capabilities with product know-how and OEM expertise Decreased customer’s costs of unscheduled Advanced analytics combined with OEM Continuous measurement enables maintenance with Wärtsilä Expert Insight1) expertise enhance customer value prediction
Slide 41: Performance driven by continuous improvement and higher volumes
Performance will be driven by continuous improvement and higher sales volumes; we will mitigate inflation with price and cost management Equipment sales Structural changes and Recent examples: continuous improvement Favorable vessel contracting mix Manufacturing footprint Uptake of sustainable fuels
Slide 43: Significant value creation opportunity
Significant value creation opportunity – improving performance and capturing growth Perform – on track to deliver our Transform – growth opportunity Transform – growth opportunity targets in Engine Power Plants in Energy Storage & Optimisation ▪ Driving performance in new build ▪ Thermal balancing a
Slide 44: Actions to improve new build profitability
Actions taken to improve new build profitability and achieve better risk / reward Organisation, team & governance ▪ New organisation structure with three global Business Units with P&L responsibility ▪ Significant changes in Energy management & leadership ▪ Energy has implemented new governance: - U
Slide 45: Balancing solutions key enablers for renewable transition
As the renewable energy transition accelerates, balancing solutions are key enablers for the transition Share of renewables in global energy generation Technology disruption in the energy sector Renewables Other Renewable generation 1) Renewables becoming main source of power 8X Gradual replacement
Slide 46: Thermal balancer market expected to grow ~20% per year
Thermal balancer market expected to grow ~20% per year – the baseload market outlook remains stable Engine power plant - baseload Engine power plant - balancers Outlook Addressable annual market (GW) Addressable annual market (GW) 1) ▪ The transition towards renewables is the driving +19% p.a. force
Slide 47: Engine power plants in strong position as balancing market grows
Engine power plants are in a strong position as the balancing market grows. Power system knowledge makes Wärtsilä the go-to partner for capacity planning Engines superior to Gas Turbines for Wärtsilä is clear market leader in engine Wärtsilä in strong position as balancing power plants thermal balan
Slide 48: Case Texas shows future trends
Case Texas shows future trends. Increasing renewables creates need for balancing with engines outperforming competing technologies 30 million population with 133 GW of 1.6X higher¹ real time market revenue Texas as a proofpoint for installed power (system size equal to France) potential for engines
Slide 49: Energy storage growth outlook remains strong
Energy storage growth outlook remains strong Order intake Market outlook Outlook Order intake (GWh) Addressable annual market (GWh) 1) ▪ Focus on profitable growth. Maintain top 5 market position +17% p.a. +35% ▪ Strong new build sales growth expected, driven by market demand ▪ >11 GWh energy storag
Slide 50: Energy Storage has grown 3X and is profitable
Energy Storage has grown 3X1) since 2021 and is now profitable – key focus on commercial approach and differentiated offering Selective commercial approach ▪ Focusing on growth of utility scale storage in selected geographies ▪ Systematic project selection to drive profitability Differentiated offer
Slide 51: Continued good profitability in services
Continued good profitability in services with a solid foundation for future growth Service order intake, MEUR Energy services – growth drivers +19% p.a. MEUR 1,306 ▪ Growing installed base 1 200 over time 1,062 915 ▪ Stable total operating 1 000 Service projects hours Service agreements ▪ Increasing
Slide 52: Moving up the service value ladder in Energy
We increase sales, profitability and customer satisfaction by moving up the service value ladder Wärtsilä service value ladder Continuous growth in agreement coverage Sales EUR/kW relative to transactional ▪ Securing service agreements for new power plants 5x ▪ Maintaining high renewal rate for exis
Slide 53: Future performance drivers
Future performance will be driven by strong sales growth and service volumes, continuous improvement, and a future-proof solution portfolio New build margins New build sales Recent actions: New organisation & governance Strong thermal balancing growth New organisational Stronger risk management Stro
Slide 54: Operating installed base is growing
Operating installed base is growing and operating hours are anticipated to remain stable driven by growth in certain customer segments Current running profile of installed base1) 60 Industrial 50 IPP’s (Independent 40 Power Producers) Utilities 30 Others 20 60 GW 10 0 Baseload 2019 2020 2021 2022 Ba
Slide 55: Advantages over combined cycle gas turbines
Advantages of Wärtsilä power plants over combined cycle gas turbines Faster startup time Higher ramp rate ▪ Combined cycle gas turbines can take over 30 minutes to ▪ Ramp rate = the rate at which a power plant can increase or start, whereas combustion engine power plants can start and decrease outpu
Slide 57: Investing in innovation (R&D expenditure)
We continue investing in innovation to ensure a broad, industry-leading solution offering 4,3 3,2 258 165 2018 2019 2020 2021* 2022 2023 R&D expenditure, MEUR % of net sales * Figure in the comparison period 2021 has been restated to reflect a change in the definition of research and development exp
Slide 58: Most comprehensive offering for decarbonisation
Industry’s most comprehensive offering for decarbonisation 2023 2024 2025 Diesel Industry’s fastest and broadest future fuel roadmap FAME/HVO1) Market leaders in 4-stroke medium-speed main LNG engines Bio-methane Market leaders in hybrids with 26% market share2) Synthetic methane Pioneer with the wo
Slide 60: All-time highs in order intake, net sales and cash flow in 2023
All-time highs in order intake, net sales and cash flow in 2023 ▪ Order intake all-time high (7,070 MEUR) ▪ Net sales all-time high (6,015 MEUR) ▪ Good progress in services continued: ▪ Service order intake increased by 15% ▪ Service net sales increased by 13% ▪ The comparable operating result incre
Slide 61: Good development in key figures
Good development in key figures MEUR 10-12/2023 10-12/2022 CHANGE 1-12/2023 1-12/2022 CHANGE Order intake 1,856 1,638 13% 7,070 6,074 16% of which services 876 791 11% 3,519 3,066 15% of which equipment 980 848 16% 3,550 3,008 18% Order book 6,694 5,906 13% of which current year deliveries 4,208 3,8
Slide 62: Marine market sentiment remained positive
Marine market sentiment remained positive for Wärtsilä’s key segments Appetite for new ships increased ▪ The number of vessels ordered in the review period increased to 1977 Total and specialised vessel contracting (1538 in the corresponding period in 2022, excluding late reporting of contracts). Nu
Slide 63: Solid long-term opportunities in energy market
Solid long-term opportunities in energy market Energy transition outlook improving amid fragile global economy ▪ Market share remained at 13% (13%), as global orders for natural Contracting for gas and liquid fuelled power plants gas and liquid-fuelled power plants decreased by 22% to 10.0 5-400 MW
Slide 64: Organic order intake increased by 21%
Organic order intake increased by 21% Equipment Services Order intake growth MEUR MEUR, 12m rolling MEUR MEUR, 12m rolling 13% 1 600 4 000 1 600 4 000 Equipment order 1404 1 400 3 500 1 400 3 500 intake increased by 1 200 3 000 1 200 3 000 16% 980 1 000 848 2 500 1 000 876 2 500 Service order intake
Slide 65: Strong order book, book-to-bill trending up
Strong order book, rolling book-to-bill continues to trend up Order book for the year 2024 higher than 2023 Order book by business Order book delivery schedule MEUR MEUR 8 000 1,30 4 500 7 000 1,20 4 000 6 000 1,10 3 500 5 000 1,00 3 000 4 000 0,90 2 500 2 000 3 000 0,80 1 500 2 000 0,70 1 000 1 000
Slide 66: Organic net sales decreased by 3%
Organic net sales decreased by 3% Equipment Services MEUR MEUR, 12m rolling MEUR MEUR, 12m rolling Net sales decreased by 1 100 987 3500 1 100 3 500 7% 1 000 1 000 3000 3 000 900 846 800 900 784 843 Equipment net sales 800 751 800 2500 2 500 decreased by 19% 700 700 2000 2 000 600 600 Service net sa
Slide 67: Profitability continued to improve
Profitability continued to improve Net sales Comparable operating result Net sales decreased by MEUR MEUR, 12m rolling MEUR %, 12m rolling 7% 2 000 1 770 7 000 200 177 12,0% Comparable operating 1 800 180 1 597 1 644 6 000 158 10,0% result increased by 1 600 160 90% 1 400 5 000 140 8,0% 1 200 120 4
Slide 68: Marine Power: Good development in order intake and net sales
Marine Power: Good development in order intake and net sales Both equipment and service net sales increased. Comparable operating margin declined due to less favourable mix between equipment and services. Order intake Comparable operating result Comparable operating result +13% 12m rolling MEUR MEUR
Slide 69: Marine Systems: Equipment order intake increased
Marine Systems: Equipment order intake increased Equipment net sales decreased Order intake Comparable operating result Comparable operating result 12m rolling +5% MEUR MEUR 12m rolling 1.2% MEUR MEUR 652 400 800 22 11,0% 308 300 600 18 9,0% 16 200 132 400 15 126 100 200 14 7,0% 15 0 0 - Lower net s
Slide 70: Energy: Comparable operating result record high
Energy: Comparable operating result record high Good development in service continued Order intake Comparable operating result Comparable operating result 34% 12m rolling MEUR MEUR 3,041 MEUR MEUR 12m 12mrolling rolling8.4% 1 200 1 031 4 000 100 7.3% 10,0% 1 000 868 89 3 000 800 646 600 2 000 + Good
Slide 71: Energy storage: margin positive
Energy storage: Comparable operating result margin (12m rolling) positive Profitability improving and strategic review continues Quarterly development Rolling 12 months development MEUR MEUR % of net sales 400 1 200 5 1056 350 1022 4 992 321 328 1 000 975 961 983 926 3 892 300 275 271 807 257 261 26
Slide 72: Continued good development in Energy service agreements
Continued good development in Energy service agreements MW under agreement globally Wärtsilä secures 12-year agreement extension with MW efficient power plant operation and maintenance 22 000 35% 20 000 ▪ Wärtsilä’s Operation & Maintenance (O&M) agreement with 18 000 30% Sindh Nooriabad Power Compan
Slide 73: Good development in Marine Power service agreements
Good development in Marine Power service agreements Marine Power net sales to agreement installations all-time high Net sales to agreement installations (12 month rolling)1) Expanding installed base under agreement MEUR, 12m rolling while climbing the service value ladder 500 ▪ Marine Power service
Slide 74: Earnings and dividend per share
Earnings and dividend per share EUR 0,80 0,70 0,60 0,50 0,40 0,30 0,20 0,10 0,00 -0,10 -0,20 2019 2020 2021 2022 2023 EPS DPS 74 ©
Slide 75: Prospects
Prospects Marine ▪ Wärtsilä expects the demand environment for the next 12 months (Q1/2024-Q4/2024) to be better to that of the comparison period. Energy ▪ Wärtsilä expects the demand environment for the next 12 months (Q1/2024-Q4/2024) to be better to that of the comparison period. 75 ©
Slide 76: Order intake
Order intake Fourth quarter development 4% (11) 42% Marine Power (42) Marine Systems Services Order intake Order intake 47% 47% by business Energy 53% by business type (48) Equipment (52) (39) Portfolio Business 7% (8) 76 ©
Slide 77: Net sales
Net sales Fourth quarter development 8% (7) 42% Marine Power (33) Services Net sales Marine Systems 49% Net sales 51% Equipment by business (56) by business type Energy (44) 44% (48) Portfolio Business 7% (12) 77 ©
Slide 78: Fourth quarter development by business type
Fourth quarter development by business type Order intake Net sales 24% 28% Spare parts (31) Spare parts (29) Field service Field service 38% Marine Marine Service agreements 45% Service agreements (40) Businesses Businesses (40) EUR 800 million Service projects EUR 914 million Service projects (796)
Slide 79: January–December order intake by customer segment
January–December order intake by customer segment Special Marine Businesses Gas carriers Cruise & ferry Offshore Navy vessels Merchant Other Marine Power Equipment 11% (13) 24% (22) 6% (2) 8% (11) 6% (13) 40% (33) 5% (5) Services 16% (15) 23% (21) 18% (15) 7% (8) 11% (11) 24% (28) 1% (2) Marine Syst
Slide 80: Orders received for Energy equipment globally
Orders received for Energy equipment globally Europe 339 (146) Americas 843 (979) Asia 372 (295) Utilities IPP’s Africa and (Independent Middle East Power Producers) 181 (130) Industrials Others Equipment order intake 1-12/2023: MEUR 1,735 (1,550) 80 ©
Slide 82: Delivering towards our sustainability targets
We are delivering towards our sustainability targets On track for our 2030 Improving safety, wellbeing and Strengthening thought leadership decarbonisation targets employee engagement and being a responsible company ✓ To become carbon neutral in ✓ Positive trend in safety indicators ✓ Developing ind
Slide 83: Strong presence in sustainable development indices
Strong presence in sustainable development indices S&P Europe 350 ESG Index ©
Slide 84: Decarbonising our own operations: Set for 30
Decarbonising our own operations requires a wide range of actions ”SET FOR 30” OUR MAIN DECARBONISATION INITIATIVES 2021 2030 Energy efficiency measures +/€ Low emission company vehicles +/€ Heat pumps in heating +/€€ R&D and factory engine testings – reduced time +/€ Self-generation and green elect
Slide 85: Set for 30 is progressing well
Wärtsilä “Set for 30” is progressing well Variety of concrete actions have been taken – some examples Environmental Green electricity Solar panel standards for purchasing fully in investment in selecting new use in Finland Bermeo Spain facilities in use Electric Vehicle Heat pumps Intelligent energy
Slide 86: Wärtsilä's ESG Agenda in brief
Wärtsilä’s ESG Agenda in brief E Ambitious decarbonisation S Good Corporate Citizen and G Effective Governance targets for 2030 Responsible model ▪ Portfolio ready for Employer ▪ Sustainability zero carbon fuels matters embedded ▪ High ethical ▪ Carbon neutrality in standards own operations ▪ Divers
Slide 87: Sustainability is integrated into our strategy and purpose
Cust om Sustainability is integrated into er & our strategy and purpose Environment Co Being a forerunner in Innovative solutions m ▪ m sustainable innovation and for a low carbon economy un High environmental ity furthermore reduce ▪ valu emissions in our customers’ performance and efficiency opera
Slide 88: Wärtsilä's focus on social responsibility
Wärtsilä’s focus on social responsibility Strong ethical culture Fair competition ▪ Clear policies and instructions Trade compliance ▪ Ethical training programmes and transparent Anti-corruption communication ▪ Effective compliance programmes Human and Labour Rights A responsible employer Equal oppo
Slide 90: Board of Management
Board of Management Håkan Agnevall, Arjen Berends, Tamara de Gruyter, Kari Hietanen, Corporate President & CEO Chief Financial President, Wärtsilä Portfolio Relations and Legal Affairs Officer Business Roger Holm, President, Anders Lindberg, President, Teija Sarajärvi, Saara Tahvanainen, Wärtsilä Ma
Slide 91: Board of Directors
Board of Directors Tom Johnstone CBE, Chair of Mika Vehviläinen, Deputy Chair of the Karen Bomba, President of Smiths Morten H. Engelstoft, CEO & EVP the Board, President and CEO Board, President & CEO of Cargotec Oyj Interconnect 2017–2020 of A.P. Møller - Mærsk A/S, APM of AB SKF 2003–2014 2013-20
Slide 92: Largest shareholders January 2024
Largest shareholders January 2024 (CMi2i quarterly update) # Name Shares Share % 1 Invaw Invest AB 104,711,363 17.70% 2 Varma Mutual Pension Insurance Company 31,768,252 5.37% 3 The Vanguard Group, Inc. 18,073,087 3.05% 4 BlackRock Fund Advisors 17,287,422 2.92% 5 Ilmarinen Mutual Pension Insurance
Slide 93: For more information, visit our Investors page
For more information, visit our Investors page Next upcoming IR events ▪ 26 April, Interim Report January-March ▪ 7 May, Investor theme call: Marine ▪ 8 May, Roadshow in London ▪ 18 May, Danske Bank Nordic Seminar ▪ 30 May, Site visit to Vaasa Wärtsilä Investor Relations Hanna-Maria Heikkinen, Vice
Slide 95: Main competitors and customer base
Main competitors Engines Other marine solutions Other energy solutions MAN Kongsberg GE Himsen Alfa Laval Siemens Rolls-Royce GE Tesla Siemens Fluence Schottel Customer base Marine businesses Energy Ship owners Utilities Ship operators Independent Power Producers Ship management (IPPs) companies Ind
Slide 96: Geographical breakdown of net sales
Wärtsilä’s position as a global company is reflected in the geographical breakdown of our net sales Geographical net sales, 2023 Europe 32% Americas 29% Asia 28% Other 10% 96 ©
Slide 97: Wärtsilä Energy Storage offering
Wärtsilä Energy Storage offering GridSolv Quantum Wärtsilä-designed and assembly subcontracted Our role in the value chain ▪ Our core offering consists of 1) battery energy storage hardware, 2) GEMS Digital Energy Platform, and 3) lifecycle services, ▪ We are an energy storage system integrator, add
Slide 98: Wärtsilä Energy Storage competitive advantages
Wärtsilä Energy Storage competitive advantages Our key differentiators ▪ Integration and scalability: Wärtsilä’s GridSolv Quantum is a fully- integrated energy storage solution. Its modular and scalable design enables ease of deployment and optimisation. It integrates storage to other energy assets
Slide 99: Wärtsilä Energy Storage's direction
Wärtsilä Energy Storage’s direction Key drivers towards higher profitability 1. Selective approach in project acceptance 2. Value differentiation 3. Volume growth supporting better cost leverage and better economics of scale in procurement and assembly 4. Continuous R&D to secure latest technology a
Slide 100: Key figures in 2023
Cg WARTSILA Key figures in 2023
Slide 101: Key figures 2023
MEUR KEY FIGURES 2023 8 000 10 % 6 000 33 % Order intake 2023 4 000 7,070 MEUR Net sales, 29 % geographical 2 000 Net sales 6,015 MEUR 0 2019 2020 2021 2022 2023 28 % Comparable operating result Net sales Order intake Europe Asia Americas Other 497 MEUR Order book 2023 8.3% of net sales MEUR % 52 %
Slide 102: Wärtsilä Marine – Leading the path towards decarbonisation
Wärtsilä Marine – Leading the path towards decarbonisation by developing state of the art technology and enabling adoption of clean fuels Key figures in 2023 Share of total net sales in 2023 Offering ▪ Multi-fuel 4-stroke engines ▪ Propulsion systems Order intake ▪ Catalyst systems ▪ Fuel gas supply
Slide 103: Wärtsilä Energy – Towards a 100% renewable energy future
Wärtsilä Energy – Towards a 100% renewable energy future Key figures in 2023 Share of total net sales in 2023 Offering • Future-fuel enabled grid balancing power plants Order intake Energy • Hybrid solutions 43% 3,041 MEUR 57% • Energy storage and optimisation Other technology, including the GEMS Di
Slide 104: WARTSILA
re, WARTSILA

Wärtsilä — Non-Deal Roadshow (April 2024) on 6ix

Wartsila Oyj Abp — Wärtsilä — Non-Deal Roadshow (April 2024)

Slide 1: Shaping the decarbonisation of marine and energy

Slide 2: Wärtsilä – Shaping the decarbonisation of marine and energy

Slide 3: Market fundamentals

Slide 4: Our value creation potential is based on two strategic themes

Slide 5: Significant milestones reached in strategy execution

Slide 6: Transform – attractive growth opportunities

Slide 7: Strong market fundamentals will support profitable growth in Marine business

Slide 8: Wärtsilä is a global technology and service leader in marine decarbonisation

Slide 9: Renewables and balancing power will support growth in Energy business

Slide 10: Global leader in engine power plants; Energy Storage profitable

Slide 11: Strategic review of Energy Storage & Optimisation

Slide 12: Perform – clear path for operational improvements

Slide 13: Services is ~50% of our net sales

Slide 14: Executing services strategy on the service value ladder

Slide 15: Benefit from operational improvements and structural changes

Slide 16: Commitment and path to reach financial targets

Slide 17: Drivers of >5% organic growth target

Slide 18: Key drivers towards 12% operating margin

Slide 19: Actively managing our business portfolio

Slide 20: Marine & Energy Engine Power Plants double digit profitability

Slide 21: Profitability drivers

Slide 22: Strong balance sheet and financial position

Slide 23: The Wärtsilä Way

Slide 24: Strategic priorities as key levers

Slide 25: Marine highlights

Slide 26: Accelerated decarbonisation targets shaping shipping

Slide 27: Progressive switch to sustainable fuels

Slide 28: Sustainable fuels roadmap to 2050

Slide 29: Fuel cost will double due to emission fees

Slide 30: Cost of emissions will close fuel price gap

Slide 31: Leading position in 4-stroke medium speed engines

Slide 32: Recovery in key segments grows addressable market

Slide 33: Hybrid-Electric LNG carrier

Slide 34: Vessel contracting forecast

Slide 35: Services is more than 60% of Marine Power sales

Slide 36: Moving up our service value ladder

Slide 37: Expanding installed base under agreement

Slide 38: Vessel utilisation rates driving service business

Slide 39: Regulations boost demand for retrofits

Slide 40: Wärtsilä Expert Insights

Slide 41: Performance driven by continuous improvement and higher volumes

Slide 42: Energy highlights

Slide 43: Significant value creation opportunity

Slide 44: Actions to improve new build profitability

Slide 45: Balancing solutions key enablers for renewable transition

Slide 46: Thermal balancer market expected to grow ~20% per year

Slide 47: Engine power plants in strong position as balancing market grows

Slide 48: Case Texas shows future trends

Slide 49: Energy storage growth outlook remains strong

Slide 50: Energy Storage has grown 3X and is profitable

Slide 51: Continued good profitability in services

Slide 52: Moving up the service value ladder in Energy

Slide 53: Future performance drivers

Slide 54: Operating installed base is growing

Slide 55: Advantages over combined cycle gas turbines

Slide 56: Innovation

Slide 57: Investing in innovation (R&D expenditure)

Slide 58: Most comprehensive offering for decarbonisation

Slide 59: Q4 and 2023 development

Slide 60: All-time highs in order intake, net sales and cash flow in 2023

Slide 61: Good development in key figures

Slide 62: Marine market sentiment remained positive

Slide 63: Solid long-term opportunities in energy market

Slide 64: Organic order intake increased by 21%

Slide 65: Strong order book, book-to-bill trending up

Slide 66: Organic net sales decreased by 3%

Slide 67: Profitability continued to improve

Slide 68: Marine Power: Good development in order intake and net sales

Slide 69: Marine Systems: Equipment order intake increased

Slide 70: Energy: Comparable operating result record high

Slide 71: Energy storage: margin positive

Slide 72: Continued good development in Energy service agreements

Slide 73: Good development in Marine Power service agreements

Slide 74: Earnings and dividend per share

Slide 75: Prospects

Slide 76: Order intake

Slide 77: Net sales

Slide 78: Fourth quarter development by business type

Slide 79: January–December order intake by customer segment