Wartsila Oyj Abp · OMXHEX:WRT1V
Wartsila Oyj Abp — Wärtsilä — Investor Day (November 2023)
25 slides from Wartsila Oyj Abp's investor day presentation, Nov 9, 2023
Slide 1: Shaping the decarbonisation of marine and energy – improving profitability and continuing growth
Shaping the decarbonisation of marine and energy – improving profitability and continuing growth Håkan Agnevall President & CEO November 9, 2023 1 ©
Slide 2: Improving profitability and continuing growth. Clear path to reach our financial targets
Improving profitability and continuing growth. Clear path to reach our financial targets Improving profitability Continuing growth ▪ Moving up the service value ladder ▪ Market leader in major technologies for a sustainable future ▪ Shifting focus from EPC to equipment ▪ Decarbonisation is accelerat
Slide 3: We are 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 4: Today’s speakers
Today’s speakers Håkan Agnevall Arjen Berends Roger Holm Anders Lindberg President & CEO Executive Vice President & President Marine Power & President Energy & Chief Financial Officer Executive Vice President Executive Vice President 4 ©
Slide 5: Agenda
Agenda 13:00 – 14:00 Shaping the decarbonisation of marine and energy – improving profitability and continuing growth 14:00 – 14:20 Good progress towards financial targets with improving trend in profitability 14:20 – 14:40 Q&A 14:40 – 15:00 Break 15:00 – 15:30 Marine Power: Leading the decarbonisat
Slide 6: Enabling sustainable societies through innovation in technology and services
Enabling sustainable Transform – Perform – societies through attractive growth clear path for opportunities at operational innovation in the center of the improvements technology and decarbonisation transformation and increased profitability services 6 ©
Slide 7: Significant milestones reached in strategy execution
Significant milestones reached in strategy execution 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 − Marine hybrid solutions ▪ Tur
Slide 8: Transform – attractive growth opportunities at the center of the decarbonisation transformation
Transform – attractive growth opportunities at the center of the decarbonisation transformation 8 ©
Slide 9: Strong market fundamentals and the decarbonisation transformation 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 10: Wärtsilä is a global technology and service leader in shaping the decarbonisation of marine
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 11: The increasing share of renewables and need for balancing power will support profitable 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 12: Wärtsilä is a global leader in engine power plants. Energy Storage & Optimisation has grown ~3X
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 13: Strategic review of Energy Storage & Optimisation launched
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 14: We lead the decarbonisation journey with a strong commitment to R&D and through partnering
We lead the decarbonisation journey with a strong commitment to R&D and through partnering for a broad solution offering Proactive dialogue on customers’ specific ▪ Working with many of the new technologies for decades technology roadmap Competence & experience to engage in a ▪ Conversion to new fue
Slide 15: Perform – clear path for operational improvements and increased profitability
Perform – clear path for operational improvements and increased profitability 15 ©
Slide 16: Services is 50% of our net sales with good future growth potential
Services is 50% of our net sales with good future growth potential EUR ~3bn ~25% >90% LTM Q3/2023 net sales Growth in net sales since 20211) Renewal rate of service agreements 1) LTM Q3/2023 vs. 2021 16 ©
Slide 17: We continue to execute our services strategy on all steps of 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) ▪ ~25% growth2) in transactional services since 2021 ▪ ~30% of installed base3) is under service agreements with further growth p
Slide 18: Going forward we will benefit from the implemented 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 19: We continue to actively manage our business portfolio
We continue to actively manage our business portfolio Marine Systems planned to be 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 limite
Slide 20: The Wärtsilä Way sets the scene for profitable growth. We reconfirm our financial targets
The Wärtsilä Way sets the scene for profitable growth. We reconfirm our financial targets 20 ©
Slide 21: The strategic priorities are the key levers to improve our performance and reach our target position
The strategic priorities are the key levers to improve our performance and reach our target position Excel in creating customer value 1 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 22: Strengthening our performance culture
Strengthening our performance culture ▪ Being successful by making our customers successful ▪ Clear leadership and delegated profit & loss responsibilities ▪ Caring for people and professional development ▪ Discipline in risk management for capturing and executing projects. Clear preference for equi
Slide 23: Improving profitability, continuing growth, reconfirming our financial targets
Improving Continuing Reconfirming our profitability growth financial targets 23 ©
Slide 24: Disclaimer
Disclaimer The information and conclusions in this presentation are based upon calculations, observations, assumptions, publicly available competitor information, and other information obtained by Wärtsilä or provided to Wärtsilä by its customers, prospective customers or other third parties (the ”i
Slide 25: Wärtsilä
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