Report for Q3 2012 - Alfa Laval · OEM declined on lower demand for AC and heat pump applications. Sanitary 11%* Industrial Equipment 15% + = + = Highlights and sequential comments

Report for Q3 2012Report for Q3 2012

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

-- Key figures Key figures

-- Orders received and margins Orders received and margins

-- Development per segmentDevelopment per segment

-- Geographical developmentGeographical development

-- Financials Financials

-- OutlookOutlook

Key figuresKey figures

�� Orders received declined 9% to SEK 7,288 million.Orders received declined 9% to SEK 7,288 million.

�� Net sales dropped 7% to SEK 7,052 million.Net sales dropped 7% to SEK 7,052 million.

�� Adjusted EBITA declined 18% to SEK 1,177 million. Adjusted EBITA declined 18% to SEK 1,177 million.

�� Adjusted EBITA margin 16.7% Adjusted EBITA margin 16.7% vsvs 18.9%18.9%

-- Negative Negative currency effect SEK 63 million.currency effect SEK 63 million.

July July –– September 2012September 2012

www.alfalaval.com© Alfa Laval Slide 3

-- Negative Negative currency effect SEK 63 million.currency effect SEK 63 million.

January January –– September 2012September 2012

�� Orders received rose 5% to SEK 23,087 million.Orders received rose 5% to SEK 23,087 million.

�� Net sales increased 6% to SEK 21,694 million.Net sales increased 6% to SEK 21,694 million.

�� Adjusted EBITA declined 8% to SEK 3,594 million. Adjusted EBITA declined 8% to SEK 3,594 million.

�� Adjusted EBITA margin 16.6% Adjusted EBITA margin 16.6% vsvs 19.0%19.0%

-- Negative currency effect SEK 76 million.Negative currency effect SEK 76 million.







-- OutlookOutlook

16 000

20 000

24 000

28 000

32 000

5 000

6 000

7 000

8 000

9 000

SEK millionSEK million

Orders receivedOrders received

SEK million R 12SEK million R 12

www.alfalaval.com

0

4 000

8 000

12 000

16 000

0

1 000

2 000

3 000

4 000

= = Order Order intake per intake per quarter quarter

= = Order Order intake per intake per quarter “large”quarter “large” = = Rolling Rolling twelve months valuetwelve months value

Q1

09

Q1

09

Q4

10

Q4

10

Q111

Q111

Q3

11

Q3

11

Q11

2Q

11

2

Q2

12

Q2

12

Q3

12

Q3

12

= % development at constant rates by = % development at constant rates by

quarter, year on yearquarter, year on year+XX%+XX%

Q3

08

Q3

08

Q4

08

Q4

08

Q2

09

Q2

09

Q3

09

Q3

09

Q4

09

Q4

09

Q11

0Q

11

0

Q2

10

Q2

10

Q3

10

Q3

10

Q2

11

Q2

11

--6%

6%

Q4

11

Q4

11

+7

2%

+7

2%

+2

3%

+2

3%

--30

%3

0%

--3%

3%

Order analysisOrder analysis

Q3 2011 Q3 2011 Q2 2012Q2 2012

Structural change, %Structural change, %

Organic development, %Organic development, %

TotalTotal

8,0188,018

Q3 2012 versus Q3 2011 and versus Q2 2012 (MSEK)Q3 2012 versus Q3 2011 and versus Q2 2012 (MSEK)

+ + 1.3 1.3

-- 7.17.1

-- 5.85.8

7,9047,904

+ 1.4 + 1.4

-- 5.05.0

-- 3.63.6


TotalTotal

Currency effects,%Currency effects,%

7,2887,288

-- 5.85.8

-- 3.33.3

7,2887,288

-- 3.63.6

-- 4.24.2

Total, %Total, %

Q3 2012 Q3 2012

-- 9.1 9.1 -- 7.87.8

Q3 2012 Q3 2012

12,012,0

15,015,0

18,018,0

21,021,0

24,024,0

900900

1 1251 125

1 3501 350

1 5751 575

1 8001 800

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

Adjusted EBITA / Adjusted EBITA / margin*margin*


0,00,0

3,03,0

6,06,0

9,09,0

12,012,0

00

225225

450450

675675

900900

* 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.”

Q211Q211 Q212Q212Q409Q409 Q110Q110 Q210Q210 Q310Q310 Q410Q410 Q111Q111 Q311Q311 Q411Q411 Q112Q112 Q312Q312Q309Q309







-- OutlookOutlook

Industrial EquipmentIndustrial Equipment

OEMOEM

Sanitary EquipmentSanitary Equipment

Orders received by customer segmentOrders received by customer segment

++

--

++

PTD Parts PTD Parts & Service& Service

Process IndustryProcess Industry

--

--

July July –– September 2012, at constant rates and like for likeSeptember 2012, at constant rates and like for like

www.alfalaval.com

EQD Parts EQD Parts & Service& Service

Equipment divisionEquipment division

Marine & Diesel divisionMarine & Diesel division

Process Technology divisionProcess Technology division

++

++

Marine & Diesel Marine & Diesel EquipmentEquipment

Marine & Offshore Marine & Offshore SystemsSystems

MDD Parts MDD Parts & & ServiceService

--

--

==

Food TechnologyFood Technology

Energy & EnvironmentEnergy & Environment --

--

YearYear--onon--year comparisonyear comparison


�� In Sanitary, food & beverages were strong while In Sanitary, food & beverages were strong while

personal care saw lower demand. personal care saw lower demand.

�� Industrial Equipment supported by large order for Industrial Equipment supported by large order for

HVAC, an application which generally did well. HVAC, an application which generally did well.

Refrigeration down from Q2. Refrigeration down from Q2.

�� OEM declined on lower demand for AC and heat pump OEM declined on lower demand for AC and heat pump

applications.applications.

SanitarySanitary

11%*11%*

Industrial Industrial

EquipmentEquipment

15%15%

++ ==

++ ==

Highlights and sequential commentsHighlights and sequential comments

www.alfalaval.com

Order Sales Backlog

Q3 2012 2,392 2,385 1,694

Q3 2011 2,462 2,776 1,736

Slide 10

applications.applications.

�� P&S unchanged, reflecting mixed picture in end P&S unchanged, reflecting mixed picture in end

marketsmarkets. .

OEMOEM

3%3%

Parts & ServiceParts & Service

5%5%

++ ==

-- --

++ ==


Sequential comparisonSequential comparison

*Share of Group total*Share of Group total


�� Food saw fewer large vegetable oil projects. Brewery Food saw fewer large vegetable oil projects. Brewery

developed favorably. developed favorably.

�� Environment grew and Power saw strong upturn in Environment grew and Power saw strong upturn in

demand from conventional and nuclear. demand from conventional and nuclear.

�� Process Industry down due to nonProcess Industry down due to non--repeat refinery repeat refinery

orders. Petrochem did well.orders. Petrochem did well. -- ++

-- --


Food Tech.Food Tech.

6%*6%*

Energy & Energy & EnvironEnviron..

12%12%

www.alfalaval.com

Order Sales Backlog

Q3 2012 3,452 2,920 8,755

Q3 2011 3,651 3,054 7,638

Slide 11

�� P&S stable with good demand from energy, O&G. P&S stable with good demand from energy, O&G.


13%13%

-- ==

-- --

-- ++




14%14%


Strengthened positionStrengthened position

Municipal and industrial wastewaterMunicipal and industrial wastewater

www.alfalaval.comSlide 12

New decanter factory in China Acquisition of leading belt filter press company


�� Marine & Diesel Equipment declined due to lower Marine & Diesel Equipment declined due to lower

order intake at the yards earlier in the year and order intake at the yards earlier in the year and

lower demand for landlower demand for land--based diesel power. based diesel power.

�� Increased demand for environmental solutions.Increased demand for environmental solutions.

�� P&S declined due to nonP&S declined due to non--repeats.repeats.

-- ==

-- --


Marine & Diesel Marine & Diesel

Equipment Equipment

8%*8%*

Marine & Marine &

Offshore SystemsOffshore Systems

4%4%

www.alfalaval.com

Order Sales Backlog

Q3 2012 1,444 1,747 5,047

Q3 2011 1,905 1,741 5,694

Slide 13

== --

-- ==




9%9%


Marine & Diesel DivisionMarine & Diesel Division

DriverShip building & Offshore

Marine environment Diesel power Parts & Service

Distribution of orders YTDDistribution of orders YTD


41%41%

Share

7%7% 13%13%

39%39%

Industrial EquipmentIndustrial Equipment

OEMOEM

Sanitary EquipmentSanitary Equipment

Orders received by customer segmentOrders received by customer segment

==

--

==

PTD Parts PTD Parts & Service& Service


--

++

January January –– September 2012, at constant rates and like for likeSeptember 2012, at constant rates and like for like

www.alfalaval.com

EQD Parts EQD Parts & Service& Service




++

Marine & Diesel Marine & Diesel EquipmentEquipment

Marine & Offshore Marine & Offshore SystemsSystems

MDD Parts MDD Parts & & ServiceService

**

--

==

Food TechnologyFood Technology

Energy & EnvironmentEnergy & Environment ++

--

YearYear--onon--year comparisonyear comparison * New customer segment, no corresponding * New customer segment, no corresponding period last year exists.period last year exists.







-- OutlookOutlook

Orders received by RegionOrders received by Region

North America North America 20%20%

Asia Asia 31%31%

Latin Latin America America 7%7%

+34

-27

+7

-6

=

July July –– September 2012, development at constant ratesSeptember 2012, development at constant rates

www.alfalaval.com© Alfa Laval

Central Central and and Eastern Eastern Europe 10%Europe 10%

Asia Asia 31%31%

Western Europe Western Europe 21%21%

Nordic Nordic 9%9%


+7

Highlights AsiaHighlights Asia

JulyJuly–– September 2012, at constant rates, sequential commentsSeptember 2012, at constant rates, sequential comments

Asia: Asia:

�� Decline in order intake as large orders Decline in order intake as large orders ––

booked in Q2 for segments Process Industry booked in Q2 for segments Process Industry

and Food and Food –– were not repeated. were not repeated.

�� The base business remained on the same level The base business remained on the same level

as the previous quarter. as the previous quarter.

-27 -11




�� Marine & Diesel Equipment declined due to low Marine & Diesel Equipment declined due to low

contracting at the yards earlier in the year. contracting at the yards earlier in the year.

�� China continued to grow.China continued to grow.

Highlights EuropeHighlights Europe

July July –– September 2012, at constant rates, sequential commentsSeptember 2012, at constant rates, sequential comments

+34 -5

-6 -20

= -14




Western Europe incl. Western Europe incl. Nordic:Nordic:

�� Large orders and base business Large orders and base business

dropped while P&S was flat.dropped while P&S was flat.

�� Only Sanitary and Industrial Only Sanitary and Industrial

Equipment reported growth.Equipment reported growth.

Central Central and Eastern and Eastern Europe: Europe:

�� Demand dropped somewhat from a very Demand dropped somewhat from a very

high level. Large orders continued to high level. Large orders continued to

grow, but base business declined. grow, but base business declined.

�� Process Technology saw good demand Process Technology saw good demand

in power and refinery. in power and refinery.

Highlights AmericasHighlights Americas

+7 +13+7 +13

July July –– September 2012, at constant rates, sequential commentsSeptember 2012, at constant rates, sequential comments

North North America: America:

�� Increase for large orders, the base business and Increase for large orders, the base business and

Parts & Service. Parts & Service.

�� Industrial Equipment among the best performers, Industrial Equipment among the best performers,

boosted by a large district heating order form a boosted by a large district heating order form a

U.S. university. U.S. university.




+7 +9+7 +9

U.S. university. U.S. university.

Latin America: Latin America:

�� Large orders continued to support the Large orders continued to support the

development while the base business declined. development while the base business declined.

�� Energy & Environment and Industrial Equipment Energy & Environment and Industrial Equipment

did well. Brazil was supported by strong demand did well. Brazil was supported by strong demand

within Oil & Gas and Parts & Service.within Oil & Gas and Parts & Service.

Orders received by RegionOrders received by Region

North America North America 19%19%

Asia Asia 33%33%

Latin Latin America America 7%7%

+31

-5

+12

+10

+2

January January –– September 2012, development at constant ratesSeptember 2012, development at constant rates


Central Central and and Eastern Eastern Europe 9%Europe 9%

Asia Asia 33%33%

Western Europe Western Europe 21%21%

Nordic Nordic 9%9%


+10

Top 10 markets*Top 10 markets*

Mid Europe

Korea, South

Nordic

China

United States

SEK million at prevailing ratesSEK million at prevailing rates


0 1 000 2 000 3 000 4 000 5 000

India

Brazil

Russia

Adriatic

South East Asia

Mid Europe

= = WY 2011WY 2011

= = Rolling 12Rolling 12--monthsmonths *The development of the 2011 top ten markets.*The development of the 2011 top ten markets.







-- OutlookOutlook Mr. Thomas Mr. Thomas ThuressonThuressonCFOCFOAlfa Laval GroupAlfa Laval Group

Order intake Q312 Order intake Q312 vsvs Q212Q212

April April –– June 2012 7,904 June 2012 7,904

-- Large orders Large orders -- 125 125

-- Other capital sales Other capital sales -- 264 264

-- Parts & Service Parts & Service -- 67 67

In MSEKIn MSEK


-- Acquisitions + 110 Acquisitions + 110

-- Translation FX Translation FX -- 270 270

July July -- September 2012 7,288 September 2012 7,288

HighlightsHighlights

Order intake Order intake

Net salesNet sales

SEK millionsSEK millions July July –– September 2012September 2012

7,2887,288

7,0527,052


Gross profit marginGross profit margin

5050

In percent of salesIn percent of sales

37.037.038.338.3

41.741.7

38.038.0


3030

404037.037.038.338.3

Q212Q212

38.038.0

Q309Q309 Q409Q409 Q110Q110 Q210Q210 Q310Q310 Q410Q410 Q111Q111 Q211Q211 Q311Q311 Q411Q411 Q112Q112 Q312Q312

HighlightsHighlights

Order intake Order intake

Net salesNet sales

Adjusted EBITAAdjusted EBITA

Adjusted EBITAAdjusted EBITA--marginmargin

SEK millionsSEK millions July July –– September 2012September 2012

7,2887,288

7,0527,052

1,1771,177

16.7% 16.7%


Profit before taxProfit before tax

Earnings per shareEarnings per share

Earnings per share, excl stepEarnings per share, excl step--upup

ROCEROCE

ROEROE

1,2301,230

2.022.02

2.732.73

26.5%26.5%

22.0%22.0%

Cash flow fromCash flow from

-- operating activitiesoperating activities

-- investing activitiesinvesting activities

Financial Financial net paidnet paid

CashCash--flow statement flow statement

SEK millionsSEK millions

Jan Jan –– SeptSept

20122012

Jan Jan –– SeptSept

20112011

2,6692,669

-- 1,9741,974

-- 2323

2,1382,138

-- 5,2365,236

141141


Financial Financial net paidnet paid

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.

-- 2323

2,2922,292

141141

1,9961,996

672672 -- 2,9572,957

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

FY 13*FY 13*

00

5050

5050

FY 12FY 12

00

--155155

-- 155155

9M 129M 12

3131

--107107

-- 7676

Q3 12Q3 12

-- 2929

-- 3434

-- 6363


TotalTotal

*Based on EUR/USD 1.29 and EUR/SEK 8.60*Based on EUR/USD 1.29 and EUR/SEK 8.60

5050-- 155155-- 7676

Projected FXProjected FX--effect for 2012 as communicated with the Q2 report effect for 2012 as communicated with the Q2 report SEK SEK --40 million 40 million

-- 6363

Order backlog as per Sept 30 Order backlog as per Sept 30

SEK millionsSEK millions

8 0008 000

10 00010 000

12 00012 000

14 00014 000

16 00016 00015,49615,496

8,7918,791

15,06815,068

8,6508,650


For delivery For delivery during the same yearduring the same year

00

2 0002 000

4 0004 000

6 0006 000

8 0008 000

For delivery For delivery next year or laternext year or later

Q308Q308 Q309Q309 Q310Q310 Q311Q311 Q312Q312

1.0

31.0

3

1.0

61.0

6

0.8

30.8

3

1.1

61.1

6

1.0

11.0

1 BookBook

to billto bill

6,7056,7056,4186,418

SalesSales

SEK (SEK (blnbln))

Full year 2011Full year 2011 28.728.7

Order backlog, likeOrder backlog, like--forfor--likelike ++ 0.40.4

AcquisitionsAcquisitions ++ 0.90.9

FXFX--translation translation -- 0.20.2

Full year 2012Full year 2012

www.alfalaval.com

SubtotalSubtotal 29.829.8

Orders “inOrders “in--forfor--out” ?out” ?

Price ?Price ?

Full year 2012Full year 2012


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






-- OutlookOutlook

Outlook for the fourth quarterOutlook for the fourth quarter

“We expect that demand during “We expect that demand during

the fourth quarter 2012 will be in the fourth quarter 2012 will be in

line with or somewhat lower than line with or somewhat lower than


line with or somewhat lower than line with or somewhat lower than

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


Cautionary statementCautionary statement

This presentation contains forward-looking statements that are based on the

current expectations of the management of Alfa Laval Group.

Although management believes that the expectations reflected in such forward-

looking statements are based on reasonable assumptions, no assurance can be

given that such expectations will prove to have been correct. Accordingly, results

could differ materially from those implied in the forward-looking statements as a

result of, among other factors, changes in economic, market and competitive

www.alfalaval.com

result of, among other factors, changes in economic, market and competitive

conditions, changes in the regulatory environment, other government actions and

fluctuations in exchange rates. Alfa Laval undertakes no obligation to publicly

update or revise these forward-looking statements, other than as required by law

or other regulations.

© Alfa Laval Slide 35

Documents

Report for Q3 2012 - Alfa Laval · OEM declined on lower demand for AC and heat pump applications. Sanitary 11%* Industrial Equipment 15% + = + = Highlights and sequential comments