Building platform for future growth key actions started to improve - PowerPoint PPT Presentation

18 November 2014 Building platform for future growth – key actions started to improve profitability Mika Vehviläinen, Interim President, MacGregor Declan Guerin, CFO, MacGregor

1. MacGregor overview 2. Market development  Merchant  Offshore 3. Key strategies 4. Conclusions 18 Nov 2014 2

Our ambition …is to build a market leading platform which delivers sustainable growth and returns through the cycle 18 Nov 2014 3

MacGregor strengths  Leading brand with long standing client relationships  Truly global with 61 service centres and 55 sales offices  Leading product range  World class R&D portfolio  Lean organisation  Flexible low cost production  More balanced portfolio: offshore growth and profitability 18 Nov 2014 4

Strong positions in merchant ship and offshore markets Hatch covers, container lashings Cranes RoRo access equipment Port and terminal solutions Marine selfunloaders Offshore load handling Marine loading arms Deck machinery Steering gears Mooring systems Offloading systems Bow loading systems 18 Nov 2014 5

Optimising functionality with integrated ship-type solutions Every ship requires a cargo flow solution which  Improves efficiency  Increases competitiveness MacGregor solutions offer functionality in  Cargo access  Cargo care/stowage  Cargo handling 18 Nov 2014 6

Integrated solutions for specific ship type and its operational requirements 18 Nov 2014 7

Financials Financial track record Balanced sales mix MEUR % 1,800 16 2014 1,600 14 1,400 2013 12 1,200 10 1,000 8 800 6 600 4 400 2 200 0 0 1-9/ 06 07 08 09 10* 11* 12* 13* 14* Merchant Offshore Service Orders Sales Operating profit% * excluding Bulk Handling business Operating profit% excluding restructuring costs 18 Nov 2014 8

Financial impact of synergies seen in order intake and material cost reduction Orders 2014 Sales 2014 OST Acquisitions Synergies Acquisitions Synergies Legacy MacGregor Legacy MacGregor 18 Nov 2014 9

1. MacGregor overview 2. Market development  Merchant  Offshore 3. Key strategies 4. Conclusions 18 Nov 2014 10

Slow recovery in merchant shipping Long-term contracting 2002 – 2023 World fleet additions 2002 – 2026 ship nos ship nos 6,000 3,500 History Forecast History Forecast 3,000 5,000 x3 ÷2 x4 ÷3 2,500 4,000 ~3% p/a 2,000 3,000 ~3% 1,500 p/a 2,000 1,000 Fleet expansion 1,000 500 Boom Over-capacity Collapse Recovery Recovery 0 0 02 04 06 08 10 12 14 16 18 20 22 02 04 06 08 10 12 14 16 18 20 22 24 26 Source: Clarkson Newbuilding Market Forecast, September 2014 x4 Magnitude of expansion / contraction in ship numbers 18 Nov 2014 11

Sub-sea support demand is expected to grow Offshore oil production Global vessel market demand  Expecting continued deep water growth  Core markets will continue to grow, support activity remains stable  Current “low” oil price is above break even  More deep-water activity is supportive of point of deep-water investments lifting and intervention equipment  Oil majors are cutting capex however, this is being offset by NOC’s expanding  Sweating of existing assets is supportive Source: Douglas Westwood 18 Nov 2014 12

Despite reducing oil price outlook remains positive Break-even price for non-producing Global oilfield service purchases, 2014 – 2020 CAGR assets in USD/barrel 0% 2% 4% 6% 8% 10% 12% Maintenance and operations EPCI 80 USD/barrel Subsea Drilling contractors Well services Downside on and commodities CAGR in an 80 USD/barrel Seismic scenario All offshore purchases Source: Rystad energy EPCI = Engineering procurement construction and installation 18 Nov 2014 13

1. MacGregor overview 2. Market development  Merchant  Offshore 3. Key strategies 4. Conclusions 18 Nov 2014 14

Key actions to drive profitability Service Sales Effectiveness  Right capabilities and  Increase sales by  Leveraging technology systems cross-selling & defining and R&D sales models  Service footprint  Design to value  Increase solution  Excellence in spare selling parts availability Grow services to Cross-selling 2% product margin 30% of sales 100 MEUR + improvement

1. MacGregor overview 2. Market development  Merchant  Offshore 3. Key strategies 4. Conclusions 18 Nov 2014 16

Conclusions  Moderate growth for merchant, offshore outlook remains positive  Margin impacted by low volumes, competitive environment, one-time costs and delivery mix  Integration and synergies on target  Building platform for growth  Key improvement actions started, impact visible 2016 onwards 18 Nov 2014 17