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FLSmidth First Quarter Interim Report 2013 Presentation

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FLSmidth 1st quarter interim report for 2013 was released on 17 May 2013. Best viewed on a full screen mode, this first quarterly report informs the reader about how well FLSmidth's business is doing financially, as well as FLSmidth's growth strategies and new financial targets projected for next quarter.

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  • 1. 16/05/20131Presentation of Interim Report Q1 201317 May 2013Interim Report Q1 2013 1Forward-looking statementsInterim Report Q1 2013FLSmidth & Co. A/S’ financial reports, whether in the form of annual reports or interim reports, filed with the Danish Business Authority and/or announced via thecompany’s website and/or NASDAQ OMX Copenhagen, as well as any presentations based on such financial reports, and any other written information released, or oralstatements made, to the public based on this interim report or in the future on behalf of FLSmidth & Co. A/S, may contain forward-looking statements.Words such as ‘believe’, ‘expect’, ‘may’, ‘will’, ‘plan’, ‘strategy’, ‘prospect’, ‘foresee’, ‘estimate’, ‘project’, ‘anticipate’, ‘can’, ‘intend’, ‘target’ and other words and termsof similar meaning in connection with any discussion of future operating or financial performance identify forward-looking statements.Examples of such forward-looking statements include, but are not limited to:• statements of plans, objectives or goals for future operations, including those related to FLSmidth & Co. A/S markets, products, product research and productdevelopment• statements containing projections of or targets for revenues, profit (or loss), capital expenditures, dividends, capital structure or other net financial items• statements regarding future economic performance, future actions and outcome of contingencies such as legal proceedings and statements regarding the underlyingassumptions or relating to such statements• statements regarding potential merger & acquisition activities. These forward-looking statements are based on current plans, estimates and projections. By their verynature, forward-looking statements involve inherent risks and uncertainties, both general and specific, which may be outside FLSmidth & Co. A/S’s influence, andwhich could materially affect such forward-looking statements.FLSmidth & Co. A/S cautions that a number of important factors, including those described in this presentation, could cause actual results to differ materially fromthose contemplated in any forward-looking statements.17 May 2013Interim Report Q1 2013 2p y gFactors that may affect future results include, but are not limited to, global as well as local political and economic conditions, including interest rate and exchange ratefluctuations, delays or faults in project execution, fluctuations in raw material prices, delays in research and/or development of new products or service concepts,interruptions of supplies and production, unexpected breach or termination of contracts, market-driven price reductions for FLSmidth & Co. A/S’ products and/orservices, introduction of competing products, reliance on information technology, FLSmidth & Co. A/S’ ability to successfully market current and new products,exposure to product liability and legal proceedings and investigations, changes in legislation or regulation and interpretation thereof, intellectual property protection,perceived or actual failure to adhere to ethical marketing practices, investments in and divestitures of domestic and foreign enterprises, unexpected growth in costsand expenses, failure to recruit and retain the right employees and failure to maintain a culture of compliance.Unless required by law FLSmidth & Co. A/S is under no duty and undertakes no obligation to update or revise any forward-looking statement after the distribution ofthis presentation.
  • 2. 16/05/20132Th S h l 48 ld d G itiNew Group CEO since 1 May 2013New CEOThomas Schulz, 48 years old and German citizenMSc & PhD in Engineering with a dissertation inMineral Mining and QuarryingFormer member of Sandvik’s Group ExecutiveManagementLeadership style: Performance driven and ambitiousteam playerteam player17 May 2013Interim Report Q1 2013 3Great business model with a sustainable profitableReasons for joining FLSmidthNew CEOpgrowth potentialInternational company with strong brand name andperformanceExciting product offerings within both minerals andcementScandinavian business culture and heritageGreat match – FLSmidth is a reflection of what I havedone the last 20 years17 May 2013Interim Report Q1 2013 4
  • 3. 16/05/20133Large pool of professional business peopleFirst impressions of FLSmidthNew CEOLarge pool of professional business peopleValue-driven company with a strong engineering baseCustomer intimacy supported by global footprint- not least in IndiaStrong business cultureObvious synergies between the cement and mineralsbusinessesA truly global company with the ambition to be the mostprofessional and innovative service providerCost, profit and capital efficiency improvements arenecessary17 May 2013Interim Report Q1 2013 5Shareholder valueKey focus areasNew CEOShareholder valueInternal efficiencyCustomer intimacySafety performance and cultureService-check of Group StrategyM i l H dliMaterial Handling17 May 2013Interim Report Q1 2013 6
  • 4. 16/05/20134Current market trendsInterim Report Q1 2013Increased market uncertainty experienced in the second halfof 2012 continued into 2013of 2012 continued into 2013Short-term outlook for mining capex has deterioratedMost commodity prices have retreated from peak levels,including copper and gold, though still above investmentthresholdsShort-term outlook for most bulk materials remains subdued,but market dynamics (import/export) create opportunities17 May 2013Interim Report Q1 2013 7Service activities still at healthy levelIn Cement, good opportunities persist although withincreasing competitionMedium to long term prospects remain encouragingKey HighlightsQ1 is seasonally weak – 2013 is no exceptionMarket outlook has deteriorated in recent months- particularly for mining capital projectsGuidance for 2013 is unchanged– however skewed towards the lower endhowever skewed towards the lower endCorrective actions will be developed and communicatedin connection with the Q2 report17 May 2013Interim Report Q1 2013 8
  • 5. 16/05/20135Order intake down 22% owing to nolarge orders in Mineral Processing andFinancial developments in Q1 2013Q1 Results 2013FLSmidth & Co. A/S(DKKm)Q1 2013 Q1 2012 Change g gCement in Q1Revenue up 17% attributable to allsegments but Material HandlingEBITA down 38%, primarily due toexecution of low margin orders in MaterialHandling and Cement backlog as well asone-off costs of DKK 68m in Q1’13.Net results down 86% includingdiscontinued activities of DKK 51m(DKKm)Order intake 5,027 6,421 -22%Order backlog 28,583 28,736Revenue 5,651 4,829 +17%Gross margin 21.9% 24.9%EBITA 254 408 -38%EBITA margin 4.5% 8.4%discontinued activities of DKK -51m(Q1’12: DKK -11m, positively impacted by taxgain in Cembrit)Employees up 19% primarily related toacquisitions and blue collar staff inconnection with O&M contracts17 May 2013 9EBIT 166 341 -51%EBIT margin 2.9% 7.1%Net results1) 34 241 -86%CFFO -466 -117Employees2) 14,811 12,422 +19%Interim Report Q1 20131) Including Cembrit2) Continuing activitiesService activities accounted for 51% of Q1 ordersInterim Report Q1 2013Revenue Q1 2013 Order intake Q1 201341%41%59%59%Capital Business51%51%49%49%Service BusinessCapital BusinessService BusinessInterim Report Q1 2013 1017 May 201351%51%
  • 6. 16/05/20136Order intake decreased 22% in Q1 2013Interim Report Q1 2013Order intake (quarterly)22% vs Q1 2012DKKmOrder backlog (quarterly)1% Q1 2012DKKm Book to bill ratio*02,0004,0006,0008,00010,000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013-22% vs. Q1 2012DKKm0.80.911.11.21.31.41.51.605,00010,00015,00020,00025,00030,00035,000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013-1% vs. Q1 2012DKKm Book-to-bill ratio*Announced O&M orders **Announced capital ordersUnannounced ordersUnannounced orders stable but order intake decreasing due to fewer large orders in Q1Order intake in Customer Services remains healthyExpected backlog conversion to revenue: 57% in 2013, 24% in 2014 and 19% in 2015 and beyond.O&M** contracts accounted for DKK 4.9bn (17%) of the order backlog at the end of Q117 May 2013Interim Report Q1 2013 11*) Order backlog divided by Last-Twelve-Months Revenue**) Operation & MaintenanceRevenue increased 17% in Q1 2013Interim Report Q1 2013Revenue (quarterly)+17% vs Q1 2012DKKmRevenue growth Q1’13 vs. Q1’1202,0004,0006,0008,00010,000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013+17% vs. Q1 2012DKKmGrowth CustomerServicesMaterialHandlingMineralProcessingCement GroupOrganic 12% 3% 14% 19% 11%Acquisitions 23% 0% 5% 0% 8%Currency -3% -3% -2% -1% -2%Total 32% 0% 17% 18% 17%Estimated organic revenue growth of 11% and acquisitive revenue growth of 8% in Q1 2013Pattern of increasing quarterly revenue over the calendar year expected to be repeated in 201317 May 2013Interim Report Q1 2013 12
  • 7. 16/05/20137Gross margin development in Q1 2013Interim Report Q1 2013Gross marginGross profit (quarterly)+3% Q1 2012DKKmGross margin Q1’13 vs. Q1’12- by segmentGross margin24.6%24.9%21.9%10%15%20%25%30%05001,0001,5002,000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013+3% vs. Q1 2012DKKm - by segment28.7%18.2% 21.8%26.8%27.0%11.8%21.5% 19.8%CustomerServicesMaterialHandlingMineralProcessingCementQ1’13Q1’12 Q1’13Q1’12 Q1’13Q1’12 Q1’13Q1’1217 May 2013Interim Report Q1 2013 13Decline in gross margin is primarily attributable to developments in Cement and MaterialHandling – as expected and guided – due to lower margins in the backlog for different reasonsLower gross margin in Customer Services in Q1 is due to business mixServices Handling ProcessingEBITA decreased 38% in Q1 2013Interim Report Q1 2013EBITA iEBITA (quarterly)38% Q1 2012DKKm DKKmChange in EBITA vs. Q1’12EBITA margin9.1% 8.4%4.5%0%3%6%9%12%15%02004006008001,000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013-38% vs. Q1 2012DKKm408254180 1691640100200300400500600700EBITA Q112 Increase inrevenueDecrease ingross marginIncrease inSG&A costsEBITA Q113DKKmEBITA margin down on Q1’12 for all segments despite revenue growthMargin decline due to decrease in gross margin and increase in SG&A costs17 May 2013Interim Report Q1 2013 14
  • 8. 16/05/20138Cash flow from operating and investing activitiesInterim Report Q1 2013CFFO (quarterly)DKKmCFFI (quarterly)+48% vs Q1 2012DKKm298% vs Q1 2012DKKm-800-400040080012001600Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013+48% vs. Q1 2012DKKm-3,000-2,400-1,800-1,200-6000600Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013-298% vs. Q1 2012Negative CFFO due to lower operational profit and increased working capitalCFFI reflects that acquisitions are temporarily on hold in 2013, and includes DKK +92m related tosale of non-core activities in Ludowici, Australia17 May 2013Interim Report Q1 2013 15Net Working capital developments in Q1Interim Report Q1 2013Average Net Working CapitalWorking capital ratio 7.7%DKKm NWC* /Revenue LTM**End Q1 2013 vs. End Q4 2012Change in Net Working capitalDKKm0%2%4%6%8%10%12%05001,0001,5002,0002,5003,000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q120131,6292,3351581,6726031,145583-1,0002,0003,0004,0005,000Ambition to cap NWC/Revenue at 10%2011 2011 2011 2011 2012 2012 2012 2012 201317 May 2013Interim Report Q1 2013 16*) NWC: Average Net Working Capital excl. Cembrit**) LTM: Last Twelve MonthsIncrease in net working capital due to increase in Work In Progress (WIP) as progress billing wasimpacted by Easter Holidays and contract conditionsTrade Payables decreased in Q1 following very high activity level and receipt of invoices in Q4, howeveroff-set by a decrease in Trade Receivables due to increased cash collections
  • 9. 16/05/20139Increased capital efficiency is top priorityInterim Report Q1 2013ROCE* (quarterly)Averagecapital employed ROCE17% in Q1 2013 EBITA %Declining ROCE explained by lowerEBITA% and TOCEp p yDKKm0%5%10%15%20%25%30%03,0006,0009,00012,00015,00018,000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013ROCE17% in Q1 2013ROCE target0%2%4%6%8%10%12%14%0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.52008201020112012Q1’13 LTM**2009EBITA %Turnover /Capital Employed (TOCE)EBITA% and TOCE (Turnover/Capital Employed)Average capital employed has increased notably due to acquisitions.. (DKK +3.5bn from Q1’12 to Q1’13)..and therefore return on capital employed has fallen (From 23% in Q1’12 to 17% in Q1’13)ROCE expectations: ~15% in 2013, increasing in 2014 and exceeding target of >20% in 201517 May 2013Interim Report Q1 2013 17*) ROCE: Return on Capital Employed calculated on a before tax basis, including goodwill and based on last 12 months’ EBITA and average Capital Employed**) LTM: Last Twelwe MonthsCapital structureInterim Report Q1 2013NIBD* (quarterly)DKKmEquity (quarterly)DKKm Equity ratioGearingGearing 1 5x EBITDA +5% Q1 2012DKKm0%10%20%30%40%50%02,0004,0006,0008,00010,000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013DKKm Equity ratio-0.8-0.400.40.81.21.622.4-2,000-1,00001,0002,0003,0004,0005,0006,000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013Gearing(NIBD/ LTM** EBITDA)Gearing 1.5x EBITDA +5% vs. Q1 2012Equity ratio target (self-imposed)Gearing target (self-imposed)Net debt and gearing increased in Q1 mainly due to weaker CFFOThe equity ratio was unchanged at 30%Committed credit facilities amounted to DKK 8.3bn (excl. mortgage) at the end of Q1 201317 May 2013Interim Report Q1 2013 18*) NIBD excluding Cembrit**) LTM: Last-Twelve-Months
  • 10. 16/05/201310Share buyback program to be initiatedInterim Report Q1 2013In February, it was announced that the Boardy,of Directors plan for an extraordinary cashdistribution of DKK 521m in the form of ashare buyback program under ‘SafeHarbour’ rulesThe Board of Directors will be initiating theprogram within the next 7 days17 May 2013Interim Report Q1 2013 19Customer Services17 May 2013Interim Report Q1 2013 20
  • 11. 16/05/201311Stable order intake but weaker EBITA marginCustomer ServicesRevenue (quarterly)DKKm EBITA margin+32% Q1 2012Order intake (quarterly)+6% vs Q1 2012DKKm DKKm EBITA margin+32% vs. Q1 20120%4%8%12%16%20%05001,0001,5002,0002,500Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q1201301,0002,0003,0004,000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013+6% vs. Q1 2012DKKmAnnounced O&M ordersAnnounced capital ordersUnannounced ordersRecord high level of unannounced orders in Q1 reflects continued good market conditionsRevenue benefitting from good order intake in previous quarters and current quarterMargin adversely impacted by business mix and costs of one-off nature17 May 2013Interim Report Q1 2013 21Customer ServicesCustomer Services(DKKm)Q1 Q1ChangeFull-year Expected(DKKm)Q2013Q2012Changey2012p2013Order intake 1,964 1,846 +6% 9,202Order backlog 8,236 6,679 +23% 8,159Revenue 1,809 1,368 +32% 7,073 DKK 8-10bnEBITDA 195 193 +1% 1,012EBITA 169 180 -6% 930EBITA margin 9.3% 13.2% 13.1% 13-15%17 May 2013Interim Report Q1 2013 22EBIT 144 174 -17% 7871)EBIT margin 8.0% 12.7% 11.1%1)1) Including one-off write-down of capitalized R&D costs in Q2’12 of approximately DKK 60m
  • 12. 16/05/201312Material Handling17 May 2013Interim Report Q1 2013 23Margin improvement continuously challengingMaterial HandlingRevenue (quarterly)DKKm EBITA marginh d Q1 2012Order intake (quarterly)+71% vs Q1 2012DKKm DKKm EBITA marginunchanged vs. Q1 201205001,0001,5002,000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013+71% vs. Q1 2012DKKm-15%-10%-5%0%5%10%15%-1,800-1,200-60006001,2001,800Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013Announced ordersUnannounced ordersSatisfactory order intake despite challenging market conditions and increased rigorousness in theproposal phaseEBITA margin adversely impacted by extra costs related to prolonged stay on customers’ sites10 out of 25 risky contracts identified and mentioned in 2012 are now close to being finalised17 May 2013Interim Report Q1 2013 24
  • 13. 16/05/201313Material HandlingMaterial Handling(DKKm)Q1 Q1ChangeFull-year Expected Order Backlog information(DKKm)Q2013Q2012Changey2012p2013Order intake 1,616 943 +71% 4,565Order backlog 5,126 5,023 2% 4,773Revenue 1,055 1,060 0% 4,997 DKK 4-6bnEBITDA -65 28 -140EBITA -79 16 -186EBITA margin -7.5% 1.5% -3.7% >0%15 projects out of a totalportfolio of 217 projects inthe Material HandlingBusiness Unit are currentlyregarded as risky (end 2012:25 projects)These projects accounted forDKK 800 16% f th17 May 2013Interim Report Q1 2013 25EBIT -98 4 -247EBIT margin -9.3% 0.4% -4.9%DKK 800m or 16% of thebacklog at the end of Q1Mineral Processing17 May 2013Interim Report Q1 2013 26
  • 14. 16/05/201314Few large orders due to deteriorating outlookMineral ProcessingRevenue (quarterly)DKKm EBITA margin+17% Q1 2012Order intake (quarterly)45% vs Q1 2012DKKm DKKm EBITA margin+17% vs. Q1 20120%3%6%9%12%15%18%21%05001,0001,5002,0002,5003,0003,500Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q1201305001,0001,5002,0002,5003,0003,500Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013-45% vs. Q1 2012DKKmAnnounced ordersUnannounced ordersAfter a period of high order activity, tender activity has come downHigh revenue as a consequence of strong order intake in previous quartersEBITA margin lower than Q1’12 due to costs of one-off nature17 May 2013Interim Report Q1 2013 27Mineral ProcessingMineral Processing(DKKm)Q1 Q1ChangeFull-year Expected(DKKm)Q2013Q2012Changey2012p2013Order intake 1,345 2,445 -45% 10,318Order backlog 9,057 9,482 -4% 9,589Revenue 2,010 1,722 +17% 9,512 DKK 10-12bnEBITDA 151 147 +3% 1,079EBITA 130 135 -4% 1,000EBITA margin 6.5% 7.8% 10.5% 8-10%17 May 2013Interim Report Q1 2013 28EBIT 88 94 -6% 7731)EBIT margin 4.4% 5.5% 8.1%1)1) Including one-off write-down of capitalized R&D costs in Q2’12 of approximately DKK 60m
  • 15. 16/05/201315Cement17 May 2013Interim Report Q1 2013 29Continued weak order intake, but pipeline encouragingCementRevenue (quarterly)DKKm EBITA margin+18% Q1 2012Order intake (quarterly)78% vs Q1 2012DKKm05001,0001,5002,0002,500Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013DKKm EBITA margin+18% vs. Q1 20120%5%10%15%20%25%05001000150020002500Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013-78% vs. Q1 2012DKKmAnnounced ordersUnannounced ordersOrder intake at a low point due to lack of large orders in Q1Trough margins in Q1 as backlog is exhausted of pre-crisis orders with higher profitabilityTender activity remains high in many parts of the world but competition has increased due to excesscapacity among equipment suppliers17 May 2013Interim Report Q1 2013 30
  • 16. 16/05/201316CementCement(DKKm)Q1 Q1ChangeFull-year Expected(DKKm)Q2013Q2012Changey2012p2013Order intake 308 1,415 -78% 4,599Order backlog 6,808 8,208 -17% 7,585Revenue 1,016 859 +18% 4,214 DKK 5-7bnEBITDA 48 102 -52% 788EBITA 39 93 -58% 752EBITA margin 3.8% 10.8% 17.8% 6-8%17 May 2013Interim Report Q1 2013 31EBIT 37 85 -56% 6691)EBIT margin 3.6% 9.9% 15.9%1)1) Including one-off write-down of capitalized R&D costs in Q2’12 of approximately DKK 60mCembrit sales processInterim Report Q1 2013Not part of FLSmidth’s long term strategy,and a sales process is on-goingReported as discontinued activitiesFLSmidth is currently in active dialogue withmore than one potential acquirerFLSmidth cautions that there is no assurancethat the process will in fact lead to a sale17 May 2013Interim Report Q1 2013 32Cembrit will not be sold if the price is notsatisfactory
  • 17. 16/05/201317Business Outlook17 May 2013Interim Report Q1 2013 33Group Guidance 2013 Actual 2012R DKK 27 30b DKK 25bGuidance 2013Future Outlook• Guidance is unchanged,but skewed towardsRevenue DKK 27-30bn DKK 25bnEBITA margin* 8-10% 10.1%Tax rate (previously 32-34%) ~36% 34%CFFI (incl. acquisitions,excl. disposals)~DKK -1bn DKK -3.6bnSegments Guidance 2013R 2012 EBITA i 2012*) EBITA margin: Includes an expected DKK 200m costs of one-off naturebut skewed towardsthe lower end of therevenue and EBITAmargin ranges• Effect of purchase priceallocations expected to beapprox. DKK -320m in 2013(2012: DKK -292m)17 May 2013Interim Report Q1 2013 34Revenue 2012 EBITA margin 2012Customer Services DKK 8-10bn (DKK 7.1bn) 13-15% (13.1%)Material Handling DKK 4-6bn (DKK 5.0bn) >0% (-3.7%)Mineral Processing DKK 10-12bn (DKK 9.5bn) 8-10% (10.5%)Cement DKK 5-7bn (DKK 4.2bn) 6-8% (17.8%)• Costs of non-recurring natureexpected to be approx. DKK200m in 2013 (2012: DKK 225m)• ROCE is expected to be approx.15% in 2013, increase in 2014and to exceed 20% in 2015
  • 18. 16/05/201318Efficiency program to be intensified– details to be presented in August 2013Interim Report Q1 2013Cost efficiencyCapital efficiencyProfitable Sales17 May 2013Interim Report Q1 2013 35SG&A costs* – clearly underperforming in Q1’13Interim Report Q1 2013SG&A ratio** seasonally high in Q1, but SG&A costs (quarterly)clearly too high in Q1’13SG&A costs up DKK 164m vs. Q1’12:Acquisitions accounted for DKK 89m of theincreaseCosts of non-recurring nature included inSG&A amounted to DKK ~68m in Q1(Q1’12:DKK ~50m)SG&A ratio14.3%15.4% 16.1%6%9%12%15%18%4006008001,0001,200+22% vs. Q1 2012DKKm17 May 2013Interim Report Q1 2013 36• ERP/business system DKK 19m• M&A integration costs DKK 23m• Restructuring costs DKK 26m0%3%0200Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013*) SG&A costs: Sales, General & Administration costs**) SG&A ratio: SG&A costs divided by Revenue
  • 19. 16/05/201319Key take-awaysQ1 i ll k 2013 i tiQ1 is seasonally weak – 2013 is no exceptionMarket outlook has deteriorated in recent months- particularly for mining capital projectsGuidance for 2013 is unchangedg– however skewed towards the lower endCorrective actions will be developed and communicatedin connection with the Q2 report17 May 2013Interim Report Q1 2013 37Questions &AAnswersNext update: Q2 Interim Report on 23 August 2013Follow us on Twitter and LinkedIn17 May 2013Interim Report Q1 2013 38
  • 20. 16/05/201320Long term financial targetsFuture OutlookFinancial targetsAnnual revenue growth Above market averageEBITA margin 10-13%ROCE* > 20%Tax rate 32-34%Equity ratio >30%Financial gearing (NIBD/EBITDA) <217 May 2013Interim Report Q1 2013 39Financial gearing (NIBD/EBITDA) <2Pay-out ratio 30-50%*) ROCE: Return on Capital Employed calculated on a before tax basis and including goodwillWorking capital programInterim Report Q1 2013Primary focus areas:Primary focus areas:Establishing measurement and reporting of workingcapital on a business unit levelDefinition of KPI’s and targets included in bonusschemes for 2013Just-in-time inventory managementCash collection of overdue debtors17 May 2013Interim Report Q1 2013 40Optimisation of supplier credit termsInitiatives related to project cash flow management
  • 21. 16/05/201321Revenue and order intake by segmentInterim Report Q1 2013Order intake Q1 2013Revenue Q1 201337%37%26%26%6%6%Order intake Q1 2013– classified by segmentCustomer ServicesCement31%31%17%17%Revenue Q1 2013– classified by segmentCustomer ServicesCement31%31%17 May 2013Interim Report Q1 2013 41Material Handling18%18%34%34%Material HandlingMineral ProcessingMineral ProcessingEBITA by segmentInterim Report Q1 2013EBITA Q1 2013 EBITA margin Q1 2013EBITA Q1 2013– classified by segment65%50%15%EBITA margin Q1 2013– classified by segment9.3%6.5%3.8%17 May 2013Interim Report Q1 2013 42-30%CustomerServicesMaterialHandlingMineralProcessingCement-7.5%CustomerServicesMaterialHandlingMineralProcessingCement
  • 22. 16/05/201322Distribution of order intake by industryInterim Report Q1 2013Order intake Q1 201327%10%4%18%Announced orders in Q1 2013Coal Mozambique DKK 658m (MH)QCementIron oreFertilizersOther17%9%15%17 May 2013Interim Report Q1 2013 43CopperGoldCoalNumber of employeesInterim Report Q1 2013Number of employees Q1’13 vs. Q1’12- by segmentNumber of employees decreased slightly - by segment4,5403,1322,275 2,4745,9073,6762,9342,292Q1’13Q1’12Number of employees decreased slightlyin Q1’13 (from 14,827 to 14,811), butincreased 19% vs. Q1’12Increase vs. Q1’12 is primarily related toacquisitions and blue collar workers inconnection with O&M contractsDevelopments in divisional number ofemployees are impacted by allocation of Q1’13Q1’12 Q1’13Q1’12 Q1’13Q1’1217 May 2013Interim Report Q1 2013 44CustomerServicesMaterialHandlingMineralProcessingCementemployees are impacted by allocation ofgroup staff