Presentation Q3 2010 ENG - Alfa Laval · Microsoft PowerPoint - Presentation_Q3_2010_ENG.pptx Author: SELUAMN Created Date: 10/22/2010 9:37:15 AM

www.alfalaval.com

ReportReport for Q3 2010for Q3 2010

Mr. Lars RenströmMr. Lars RenströmPresident and CEOPresident and CEOAlfa Laval GroupAlfa Laval Group

-- Orders received and marginsOrders received and margins

-- HighlightsHighlights

-- Development per segmentDevelopment per segment

-- Geographical developmentGeographical development

-- Financials Financials

-- OutlookOutlook

Key figuresKey figures

�� Orders received Orders received rose 21% rose 21% to SEK to SEK 6,134 6,134 million.million.

�� Net sales Net sales unchanged at unchanged at SEK SEK 5,811 5,811 million.million.

�� Adjusted EBITA up 14% at SEK 1,141 million. Adjusted EBITA up 14% at SEK 1,141 million.

�� Adjusted EBITA margin widened to 19.6% Adjusted EBITA margin widened to 19.6%

-- Positive currency effect SEK 124 million.Positive currency effect SEK 124 million.

July July –– September 2010September 2010

www.alfalaval.com© Alfa Laval Slide 3

-- Positive currency effect SEK 124 million.Positive currency effect SEK 124 million.

�� Orders received increased 9% to SEK 17,490 million.Orders received increased 9% to SEK 17,490 million.

�� Net sales down 10% at SEK 17,551 million.Net sales down 10% at SEK 17,551 million.

�� Adjusted EBITA down 2% at SEK 3,345 million. Adjusted EBITA down 2% at SEK 3,345 million.

�� Adjusted EBITA margin increased to 19.1% Adjusted EBITA margin increased to 19.1%

-- Positive currency effect Positive currency effect SEK 324 millionSEK 324 million..

January January –– September 2010September 2010

16 000

20 000

24 000

28 000

32 000

4 000

5 000

6 000

7 000

8 000

SEK millionSEK million

Orders receivedOrders received

SEK million R 12SEK million R 12


0

4 000

8 000

12 000

16 000

0

1 000

2 000

3 000

4 000

= rolling twelve months value= rolling twelve months value

= order intake per quarter= order intake per quarter

Q1

09

Q1

09

Q3

06

Q3

06

Q4

06

Q4

06

Q1

07

Q1

07

Q2

07

Q2

07

Q3

07

Q3

07

Q4

07

Q4

07

Q1

08

Q1

08

Q2

08

Q2

08

+17%

+17%

+40%

+40%

+36%

+36%

+13%

+13%

+30%

+30% 0%

0%

+9%

+9%

+8%

+8%

= % development at constant rates by = % development at constant rates by quarter, year on yearquarter, year on year

+xx%+xx%

--3%

3%

Q3

08

Q3

08

Q4

08

Q4

08

--15%

15%

--32%

32%

Q2

09

Q2

09

--37%

37%

Q3

09

Q3

09

--30%

30%

Q4

09

Q4

09

--12%

12%

--13%

13%

Q11

0Q

11

0

Q2

10

Q2

10

+21%

+21%

Q3

10

Q3

10

+21%

+21%

Order analysisOrder analysis

2009 2009 (SEK millions)(SEK millions)

Structural change, %Structural change, %

Currency effects,%Currency effects,%

Organic development, %Organic development, %

Total, %Total, %

5,0715,071

July July –– September 2010September 2010

+ + 3.7 3.7

-- 2.12.1

+ 19.4+ 19.4

+ 21 + 21


Total, %Total, %

2010 2010 (SEK million)(SEK million) 6,1346,134

+ 21 + 21

12,0

15,0

18,0

21,0

24,0

1 125

1 350

1 575

1 800

SEK millions and in percent of salesSEK millions and in percent of sales

Adjusted EBITA / margin *Adjusted EBITA / margin *


0,0

3,0

6,0

9,0

12,0

0

225

450

675

900

* Adjusted EBITA * Adjusted EBITA –– ”Earnings before interests, taxes, amortization of goodwill and step up values and comparison distortion item”Earnings before interests, taxes, amortization of goodwill and step up values and comparison distortion items.”s.”

Q108Q108 Q109Q109 Q409Q409 Q110Q110 Q210Q210 Q310Q310Q307Q307 Q407Q407 Q208Q208 Q308Q308 Q408Q408 Q209Q209 Q309Q309

InterimInterim ReportReport Q3 2010Q3 2010







-- OutlookOutlook

Highlights during the quarterHighlights during the quarter

�� Waste water treatment order in the US.Waste water treatment order in the US.Order Order value SEK value SEK 250 million, of which 40 million was booked in Q2. 250 million, of which 40 million was booked in Q2.

Deliveries finalized Deliveries finalized in in 20132013..

Large orders, total SEK Large orders, total SEK 270 270 million million (175) (175)


Highlights during the quarterHighlights during the quarter

Large orders, total SEK Large orders, total SEK 270 million (175) 270 million (175)

�� Waste water treatment order in the US.Waste water treatment order in the US.�� Heat exchanger order from Tata Chemicals in India.Heat exchanger order from Tata Chemicals in India.

Order value SEK 60 million. Delivery in 2011.Order value SEK 60 million. Delivery in 2011.


InterimInterim reportreport Q3 2010Q3 2010







-- OutlookOutlook

Orders received by customer segmentOrders received by customer segment

Industrial EquipmentIndustrial Equipment

Marine & DieselMarine & Diesel

OEMOEM

Life ScienceLife Science

Process IndustryProcess Industry

Energy & EnvironmentEnergy & Environment

July July –– September 2010, September 2010, at constant ratesat constant rates

−−−−

====

++++

++++

++++

++++

++++

====


SanitarySanitary

OEMOEMFoodFood

Parts & ServiceParts & Service

++++

====++++

++++

====

Orders received by customer segmentOrders received by customer segmentProcess Technology Division Process Technology Division July July –– September 2010, September 2010, at constant ratesat constant rates




−−−−

====

++++

++++

www.alfalaval.com

Slide 12

�� Boost from US wasteBoost from US waste--waterwaterorder order -- largest order ever for largest order ever for Alfa LavalAlfa Laval

�� Strong demand for parts, Strong demand for parts, repair, maintenance andrepair, maintenance andupgradesupgrades

�� Process Industry affected byProcess Industry affected bynonnon--repeatsrepeats

© Alfa Laval

FoodFood


====

++++

Orders received by customer segmentOrders received by customer segmentEquipment Division, Equipment Division, July July –– September 2010, September 2010, at constant ratesat constant rates

�� Increased activity in both food and Increased activity in both food and pharmapharma boosted Sanitary boosted Sanitary

�� Strong demand from OEMsStrong demand from OEMs�� Increased trade and higher Increased trade and higher

utilization rates lifted demand utilization rates lifted demand for parts and servicefor parts and service



++++

++++

++++


SanitarySanitary

OEMOEM


++++

++++

++++

Orders received by customer segmentOrders received by customer segment



OEMOEM




January January -- September 2010, September 2010, at constant ratesat constant rates

−−−−

++++

++++

−−−−

++++

====

++++


SanitarySanitary

OEMOEMFoodFood


++++

++++ ++++

++++








-- OutlookOutlook

Orders received by RegionOrders received by Region

Asia Asia 33 33 %%


--99+67+67

+14+14

+26+26


Asia Asia 33 33 %%

+9+9

North America North America

� All segments reported growth

� Boost from largest order ever

Latin America Latin America

�� Generally strong development with Generally strong development with

Highlights AmericasHighlights AmericasJuly July –– September 2010, September 2010, at constant ratesat constant rates

+67+67


�� Generally strong development with Generally strong development with

Energy & Environment, Food and Energy & Environment, Food and

Sanitary performing the bestSanitary performing the best+9+9

Highlights EuropeHighlights Europe

Western Europe incl. NordicWestern Europe incl. Nordic

�� Best development in UK and Best development in UK and

Mid EuropeMid Europe

�� Base business grew substantiallyBase business grew substantially

Central and Eastern Europe Central and Eastern Europe


--99

+14+14


Central and Eastern Europe Central and Eastern Europe

�� Decline explained by nonDecline explained by non--repeats repeats

in Russiain Russia

�� Very good development for base business Very good development for base business

and Parts & Serviceand Parts & Service

Highlights AsiaHighlights Asia

Asia Asia

�� Broad positive development Broad positive development

and strongest performance in and strongest performance in

China, India and Korea China, India and Korea

�� Segments that stood out were Segments that stood out were

OEM, Sanitary and FoodOEM, Sanitary and Food



Orders received by RegionOrders received by Region

Asia Asia 31 31 %%

January January –– September 2010, September 2010, at constant ratesat constant rates

==+36+36

+8+8

+15+15


+21+21


Mr. Thomas ThuressonMr. Thomas ThuressonCFOCFOAlfa Laval GroupAlfa Laval Group






-- OutlookOutlook

HighlightsHighlights

Order intake Order intake

Net salesNet sales

6,1346,134

5,8115,811

SEK millionsSEK millions JulyJuly –– September 2010September 2010


Gross profit marginGross profit margin

40

50In percent of salesIn percent of sales

41.741.7

38.038.0

40.640.6

39.139.1

www.alfalaval.com© Alfa Laval

20

30

38.038.0

Q109Q109 Q309Q309 Q409Q409 Q110Q110 Q210Q210 Q310Q310Q307Q307 Q407Q407 Q108Q108 Q208Q208 Q308Q308 Q408Q408 Q209Q209

Gross Profit MarginGross Profit Margin-- analysis yearanalysis year--onon--year and sequentiallyyear and sequentially

Actual Actual

-- Foreign exchange, transactionForeign exchange, transaction

-- Change in product mixChange in product mix

Sub.totalSub.total::

39.639.6

-- 0.40.4

+ 1.1+ 1.1

40.340.3

In percentIn percent Q2 2010Q2 2010

38.038.0

+ 2.1+ 2.1

+ 0.8 + 0.8

40.940.9

Q3 2009Q3 2009

--Procurement (Procurement (negneg))


ActualActual for Q3 2010:for Q3 2010: 41.741.7 41.741.7

--Procurement (Procurement (negneg))

--Productivity (pos)Productivity (pos)

--Price adjustments (pos)Price adjustments (pos)

--Margin in order backlog (Margin in order backlog (negneg))

--Volume (pos)Volume (pos)


Order intake Order intake Net salesNet salesAdjusted EBITAAdjusted EBITA

Adjusted EBITAAdjusted EBITA--marginmargin

Profit before taxProfit before tax

SEK millionsSEK millions JulyJuly –– September 2010September 2010

6,1346,134

5,8115,8111,1411,141

19.6%19.6%

1,0441,044


Earnings per shareEarnings per share

EarningsEarnings

Earnings, excluding Earnings, excluding stepstep--upup

20102010

1.781.78

1.951.95

20092009

1.651.65

1.801.80

July July -- SepSep

20102010

5.205.20

5.705.70

20092009

4.944.94

5.355.35

Jan Jan -- SepSep


Repurchase of sharesRepurchase of shares

SeptSept 3030

2,583,1512,583,151

0.60.6

--253253

Repurchased shares for cancellationRepurchased shares for cancellation

Percentage of outstanding Percentage of outstanding sharesshares

CashCash--out and decrease in parent companyout and decrease in parent company


and consolidated equity (SEK and consolidated equity (SEK mlnmln))

The AGM 2010 gave the Board a mandate to repurchase up to 5 percent The AGM 2010 gave the Board a mandate to repurchase up to 5 percent

of the company’s issued shares up until the next AGM in 2011. of the company’s issued shares up until the next AGM in 2011.


Order intake Order intake

Net salesNet sales

Adjusted EBITAAdjusted EBITA

Adjusted EBITAAdjusted EBITA--marginmargin


SEK millionsSEK millions July July –– Sept 2010Sept 2010

6,1346,134

5,8115,811

1,1411,141

19.6% 19.6%

1,0441,044



Cash flow from operating activitiesCash flow from operating activities

ROCEROCE

ROEROE

1,0441,044

1,1181,118

35.8%35.8%

23.1%23.1%

Cash flow fromCash flow from

-- operating activitiesoperating activities

-- investing activitiesinvesting activities

Financial Financial net paidnet paid

TotalTotal

CashCash--flow statement flow statement

SEK millionsSEK millions

Jan Jan –– SepSep

20102010

Jan Jan –– SepSep

20092009

3,0173,017

-- 646646

-- 1010

3,7813,781

--2,5412,541

-- 153153

2,3612,361 1,0871,087


TotalTotal

Pro Forma Pro Forma Free cashFree cash--flowflow****Incl. operating activities, capital expenditure and financial net paid.Incl. operating activities, capital expenditure and financial net paid.

2,7802,780 3,3243,324

2,3612,361 1,0871,087

Foreign exchangeForeign exchange

SEK millionSEK million

Translation effectTranslation effect

Transaction effectTransaction effect

TotalTotal

Estimated impact on adjusted EBITA from FX fluctuationsEstimated impact on adjusted EBITA from FX fluctuations

WY 10WY 10

-- 160160

+480+480

+320+320

WY WY 11*11*

--100100

--240240

--340340

Q3 10Q3 10

+4+4

+120+120

+124+124

9M 109M 10

--7171

+395+395

+324+324


TotalTotal

*Based on EUR/USD 1.38 and EUR/SEK 9.30*Based on EUR/USD 1.38 and EUR/SEK 9.30

+320+320 --340340+124+124 +324+324

Order backlog as per Sept 30

SEK millionsSEK millions

10000

12000

14000

16000

1800015,87315,873

9,3069,306

5,7515,751

7,7057,705

13,19213,192

11,68911,689


For delivery For delivery current yearcurrent year

0

2000

4000

6000

8000

10000

For delivery For delivery after current yearafter current year

5,7515,751

5,4875,4876,5676,567

5,9385,938

20082008 20092009 20102010

SalesSalesFull year Full year 20102010

SEK (SEK (blnbln))

9M Sales9M Sales 17.617.6

Backlog Backlog + 5.9+ 5.9

SubtotalSubtotal 23.523.5

Remaining main parametersRemaining main parameters

++ 1.01.0

www.alfalaval.com

Orders “inOrders “in--forfor--out” 4Qout” 4Q ++ 1.01.0(assuming 2009 level)(assuming 2009 level)

AcquisitionsAcquisitions (assuming no further acquisitions)(assuming no further acquisitions) ++ 0.20.2

FX FX (assuming current rates rest of year)(assuming current rates rest of year) -- 0.30.3

Full year 2010Full year 2010 apprappr 24.424.4



-- Orders received and operating margin Orders received and operating margin





-- OutlookOutlook

Outlook for the fourth quarterOutlook for the fourth quarter

“We expect demand in the fourth “We expect demand in the fourth

quarter to be on about the same level quarter to be on about the same level


as in the third quarter.”as in the third quarter.”

www.alfalaval.com

Documents

Presentation Q3 2010 ENG - Alfa Laval · Microsoft PowerPoint - Presentation_Q3_2010_ENG.pptx Author: SELUAMN Created Date: 10/22/2010 9:37:15 AM