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FLSmidth Third Quarter Interim Report 2013
 

FLSmidth Third Quarter Interim Report 2013

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FLSmidth 3rd quarter interim report for 2013 was released on 6 November 2013. Best viewed on a full screen mode, this first quarterly report informs the reader about how well FLSmidth's business is ...

FLSmidth 3rd quarter interim report for 2013 was released on 6 November 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. The key highlights include: a) Business environment unchanged b) Decreasing order intake due to lack of large orders c) Return on Capital Employed (ROCE) 10% (ROCE 15% adjusted for special items) d) EBITA margin 3.6% (EBITA margin 9.1% adjusted for special items) e) Efficiency Programme progressing according to plans f) Group guidance for 2013 maintained.

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    FLSmidth Third Quarter Interim Report 2013 FLSmidth Third Quarter Interim Report 2013 Presentation Transcript

    • Presentation of Interim Report Q3 2013 Interim Report Q3 2013 6 November 2013 1
    • Interim Report Q3 2013 Forward-looking statements FLSmidth & 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 the company’s website and/or NASDAQ OMX Copenhagen, as well as any presentations based on such financial reports, and any other written information released, or oral statements 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 terms of 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 product development • 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 underlying assumptions 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 very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, which may be outside FLSmidth & Co. A/S’s influence, and which 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 from those contemplated in any forward-looking statements. Factors 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 rate fluctuations, 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/or services, 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 costs and 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 of this presentation. Interim Report Q3 2013 6 November 2013 2
    • Key highlights Q3 2013 Key highlights Q3 2013  Business environment unchanged  Decreasing order intake due to lack of large orders  Return on Capital Employed (ROCE) 10%  EBITA margin 3.6% (ROCE 15% adjusted for special items) (EBITA margin 9.1% adjusted for special items)  Efficiency Programme progressing according to plans  Group guidance for 2013 maintained Interim Report Q3 2013 6 November 2013 3
    • Interim Report Q3 2013 Current market trends  Mining capex outlook still challenging - Downturn expected to continue throughout 2014 - Mining operating expenditures still at healthy level - Commodity prices holding up  Global cement market remains subdued and competitive - Pockets of recovery - US recovery continues - Struggling Indian economy - Stable service business  No cancellations of orders in the backlog Interim Report Q3 2013 6 November 2013 4
    • Strategy The Future of FLSmidth FLSmidth will be the preferred full service provider     Six key industries Full-service solutions Full product flow sheets Service of technology Preparing FLSmidth for the next 130 years Interim Report Q3 2013 6 November 2013 5
    • Efficiency Programme Efficiency Programme Update Targeted full-year effect in 2015 Reported effect in Q3’13 Estimated fullyear effect (run-rate) Headcount reductions -1,100 -38 -820 Location reductions >20 0 28 One-off costs DKK -500m DKK -167m DKK -350m EBITA improvement DKK+750m p.a. DKK ~0m DKK +338m (2013-2014 effect) (2013 full year effect) Interim Report Q2 2013 23 August 2013 6
    • Efficiency Programme Efficiency Programme Update DKK +338m EBITA improvement run-rate: 28% (SG&A costs) 23% (SG&A costs and Gross profit) 45% (Costs of goods sold) Started No EBITA effect Started 4% (product pruning) Interim Report Q2 2013 23 August 2013 7
    • Interim report Q3 2013 Financial developments in Q3 2013 Q3 2013 Q3 2012 Change Change FX adjusted 4,642 7,956 -42% -36% 24,595 31,766 -23% Revenue 6,730 6,708 0% Gross margin 18.6% 26.0% 245 655 EBITA margin 3.6% 9.8% EBIT -727 557 EBIT margin -10.8% 8.4% Net results -783 377 283 -28 2,285 2,930 10% 19% 15,735 15,839 FLSmidth & Co. A/S (DKKm) Order intake Order backlog EBITA CFFO Working Capital ROCE Employees -63% +7%  Order intake down 42% (36% adjusted for currency) impacted by lack of large orders  Revenue increased 7% if adjusted for currency  EBITA down 63%, primarily due to special items  EBIT affected by Ludowici impairment write-down  CFFO supported by a decrease in net working capital  ROCE 15% adjusted for special items -1% Interim Report Q3 2013 6 November 2013 8
    • Interim Report Q3 2013 Order intake decreased 42% in Q3’13 vs. Q3’12 Order intake DKKm 10,000 8,000 (quarterly) Order intake by industry -42% vs. Q3 2012 Announced O&M orders Announced capital orders Unannounced orders Other Fertilizers Iron ore Coal 6,000 4,000 (quarterly) Gold 15% 3% 1% Cement 36% 6% 6% 2,000 33% 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 Copper  Order intake decreased 36% adjusted for currency  Decline in order intake due to lack of large orders, whereas unannounced orders are stable Interim Report Q3 2013 6 November 2013 9
    • Interim Report Q3 2013 Revenue flat vs. Q3 2012 (increased 7% adjusted for currency) Revenue DKKm (quarterly) 0% vs. Q3 2012 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0  Revenue growth +7% adjusted for currency. No M&A impact  Service activities accounted for 34% of Q3 revenue Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013  Pattern of seasonally increasing revenue over the calendar year broken in Q3, related to Customer Services and Material Handling Interim Report Q3 2013 6 November 2013 10
    • Interim Report Q3 2013 Gross margin development Gross profit DKKm -28% vs. Q3 2012 2,000 1,500 26.8% 26.0% Gross margin Q3’13 vs. Q3’12 (quarterly) Gross margin - by division 40% 18.6% 1,000 30% 36.5% 28.3% 20% 500 23.5% 18.2% 10% 0 0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 13.7% 15.1% 21.3% 11.6% Q3’12 Q3’13 Customer Services Q3’12 Q3’13 Material Handling Q3’12 Q3’13 Mineral Processing Q3’12 Q3’13 Cement  Decline in gross margin due to inventory write-down, one-off costs related to the efficiency programme and execution of low margin order backlog in Cement Interim Report Q3 2013 6 November 2013 11
    • Interim Report Q3 2013 SG&A ratio down in Q3’13 vs. Q3’12 SG&A costs* DKKm -10% vs. Q3 2012 1,200 1,000 (quarterly) 13.8% 14.7% SG&A ratio* 18% 13.8% 15% 800 12% 600 9% 400 6% 200  SG&A ratio down 0.9%points vs. Q3’12 3% 0  SG&A ratio impacted by efficiency programme oneoff costs in Q3’13 0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 *) SG&A ratio: SG&A costs divided by revenue Interim Report Q3 2013 6 November 2013 12
    • Interim Report Q3 2013 EBITA decreased 63% in Q3’13 vs. Q3’12 EBITA DKKm -63% vs. Q3 2012 1,000 800 11.9% EBITA bridge reported vs. adjusted (quarterly) EBITA margin 15% 12% 9.8% 600 9% 400 3.6% 6% DKKm EBITA margin 800 9.1% 600 400 200 3% 200 0 0% 167 3.6% 203 615 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 245 EBITA Q3'13 Inventory writedown Efficiency EBITA Q3'13 programme adjusted one-off costs  EBITA margin down to 3.6% primarily due inventory write-down and efficiency programme oneoff costs. EBITA-margin 9.1% adjusted for special items Interim Report Q3 2013 6 November 2013 13
    • Interim Report Q3 2013 Return on Capital Employed decreased further Average capital employed DKKm 18,000 ROCE* (quarterly) 10% in Q3 2013 ROCE target ROCE capital employed DKKm 30% 25% 20% 12,000 9,000 15% 9,000 6,000 10% 6,000 3,000 5% 3,000 0% Acquisition of Ludowici 15,000 12,000 (end of quarter) 18,000 15,000 Capital employed 0 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013  ROCE 10% in Q3  ROCE decreased 9%-points vs. Q3 2012 due to declining EBITA margin and increased average capital employed as a result of acquisitions made in 2012 and higher average working capital *) ROCE: Return on Capital Employed calculated on a before tax basis, including goodwill and based on last 12 months’ EBITA and average Capital Employed Interim Report Q3 2013 6 November 2013 14
    • Interim Report Q3 2013 Net working capital reduced by DKK 312m in Q3’13 Net working capital DKKm Change in net working capital DKKm End Q3 2013 vs. End Q2 2013 3,200 3,000 2,500 3,000 2,000 66 2,800 1,500 255 416 2,600 1,000 18 557 2,400 500 2,200 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 2,597 2,285 2,000 Interim Report Q3 2013 6 November 2013 15
    • Interim Report Q3 2013 Positive free cash flow of DKK +91m in Q3 2013 CFFO DKKm CFFI (quarterly) DKK +283m in Q3 2013 DKKm (quarterly) DKK -192m in Q3 2013 1600 600 1200 0 800 -600 400 -1,200 0 -1,800 -400 -2,400 -800 -3,000 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013  Positive cash flow from operating activities (CFFO) due to decrease in net working capital  Cash flow from investments (CFFI) reflects that acquisitions are temporarily on hold Interim Report Q3 2013 6 November 2013 16
    • Interim Report Q3 2013 Divisional developments in Q3’13 vs. Q3’12  Customer Services – stable level of unannounced orders  Material Handling – positive EBITA margin adjusted for special items  Mineral Processing - solid earnings despite special items  Cement - earnings significantly below last year as expected order intake -37%, revenue -12%, EBITA -87% order intake -62%, revenue -19%, EBITA DKK -34m order intake -42%, revenue +1%, EBITA 0% order intake -6%, revenue +53%, EBITA -82% Interim Report Q3 2013 6 November 2013 17
    • Customer Services Customer Services - Unannounced orders stable Order intake DKKm 4,000 3,000 Revenue (quarterly) -37% vs. Q3 2012 Announced O&M orders Announced capital orders Unannounced orders DKKm (quarterly) -12% vs. Q3 2012 2,500 EBITA margin 20% 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 1,500 12% 8% 500 1,000 16% 1,000 2,000 2,000 4% 0 0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013  Order intake down 33% adjusted for currency due to large orders received in Q3’13  Stable underlying order intake  Revenue down 6% adjusted for currency, but up 13% year to date Interim Report Q3 2013 6 November 2013 18
    • Special items Impairment and inventory write-downs in Q3  Ludowici impairment write-down of DKK -880m    Deteriorating outlook for mining capex in general and for the Australian coal industry in particular Impairment tests led to write-down Inventory write-down of DKK -203m  Thorough inventory review  More stringent assessment of ageing inventory items Interim Report Q3 2013 6 November 2013 19
    • Special items Special items included in the full-year guidance EBITA EBIT Material Handling one-off costs in Q2 DKK -323m DKK -323m Expected costs related to efficiency programme in Q3-Q4 DKK -350m DKK -350m Inventory write-down in Q3 DKK -203m DKK -203m DKK -880m Ludowici impairment loss in Q3 Total full-year impact DKK -876m DKK -1,756m Additionally, the guidance for 2013 includes costs of one-off nature amounting to DKK -200m as announced in connection with Annual Report 2012. Interim Report Q3 2013 6 November 2013 20
    • Guidance Group guidance 2013 maintained Group Revenue EBITA margin CFFI ROCE Guidance 2013 2012 DKK 26-28bn DKK 26.3bn 4-5% 9.7% ~DKK -0.8bn DKK -3.4bn 7-8% 18% Interim Report Q3 2013 6 November 2013 21
    • Guidance Divisional guidance 2013 Updated to include allocation of special items to divisions Segments Guidance 2013 Revenue (previously) EBITA margin (previously excl. special items) Customer Services DKK 7-8bn DKK 8-9bn 10-11% (13-14%) Material Handling DKK 4-5bn -11% to -12% (-8% to -9%) Mineral Processing DKK 9-10bn DKK 9-11bn 8-9% (8-9%) Cement DKK 5-6bn 5-6% (6-7%)  Cembrit is expected to generate a revenue of DKK ~1.4bn and an EBITA margin of ~-4% including special items in 2013  Eliminations in the form of intercompany trade is expected to amount to around DKK -1bn Interim Report Q3 2013 6 November 2013 22
    • Guidance Outlook  Mining capex downturn to continue throughout 2014  Cement capex already at a low level, but pockets of recovery  Customer Services resilient and still growing  Current order intake not sufficient to sustain current level of revenue  Revenue will be lower in 2014 than in 2013 Interim Report Q3 2013 6 November 2013 23
    • Key highlights Q3 2013 Key highlights Q3 2013  Business environment unchanged  Decreasing order intake due to lack of large orders  Return on Capital Employed (ROCE) 10%  EBITA margin 3.6% (ROCE 15% adjusted for special items) (EBITA margin 9.1% adjusted for special items)  Efficiency Programme progressing according to plans  Group guidance for 2013 maintained Interim Report Q3 2013 6 November 2013 24
    • Questions & Answers Next update: Annual Report on 13 February 2014 Follow us on Twitter and LinkedIn Interim Report Q3 2013 6 November 2013 25
    • Appendices - backup slides Interim Report Q3 2013 6 November 2013 26
    • Customer Services Interim Report Q3 2013 6 November 2013 27
    • Customer Services Customer Services Q3 2013 Q3 2012 Change Q1-Q3 2013 Q1-Q3 2012 Change Full-year 2012 Order intake 2,109 3,345 -37% 5,973 6,760 -12% 9,202 Order backlog 8,325 7,909 +5% 8,325 7,909 5% 8,159 Revenue 1,736 1,968 -12% 5,565 4,944 13% 7,073 EBITDA 53 258 -80% 568 695 -18% 1,012 EBITA 29 226 -87% 496 637 -22% 930 EBITA margin 1.7% 11.5% 8.9% 12.9% 13.1% EBIT -5311) 199 -1101) 5282) 7872) -30.6%1) 10.1% -2.0%1) 10.7%2) 11.1%2) (DKKm) EBIT margin Expected 2013 DKK 7-8bn 10-11% 1) Including Ludowici impairment loss of DKK -528 2) Including one-off write-down of capitalized R&D costs in Q2’12 of approximately DKK 60m Interim Report Q3 2013 6 November 2013 28
    • Material Handling Interim Report Q3 2013 6 November 2013 29
    • Material Handling Revenue and order intake declining Order intake DKKm 2,000 1,500 Revenue (quarterly) -62% vs. Q3 2012 Announced orders Unannounced orders 1,000 500 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 DKKm 2,400 1,800 1,200 600 0 -600 -1,200 -1,800 -2,400 11 11 11 (quarterly) -19% vs. Q3 2012 EBITA margin 40% 30% 20% 10% 0% -10% -20% -30% -40% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013  Decreasing order intake and revenue reflects continued challenging market conditions and a prudent tender approach  EBITA margin adjusted for special items +3.9% in Q3 Interim Report Q3 2013 6 November 2013 30
    • Material Handling Material Handling Q3 2013 Q3 2012 Change Q1-Q3 2013 Q1-Q3 2012 Change Fullyear 2012 Order intake 638 1,675 -62% 3,282 3,890 -16% 4,565 Order backlog 4,465 5,514 -19% 4,465 5,514 -19% 4,773 Revenue 1,081 1,340 -19% 3,080 3,671 -16% 4,997 EBITDA -19 -29 -440 27 -140 EBITA -34 -42 -482 -9 -186 -3.1% -3.1% -15.6% -0.2% -3.7% -46 -60 -531 -44 -247 -4.3% -4.5% -17.2% -1.2% -4.9% (DKKm) EBITA margin EBIT EBIT margin Interim Report Q3 2013 Expected 2013 DKK 4-5bn -11% to -12% 6 November 2013 31
    • Interim report Q3 2013 Status on legacy projects in Material Handling  No new problematic projects identified  15 projects out of a total portfolio of 180 projects in the Material Handling Business Unit are currently regarded as risky (end of Q2 2013: 15 projects)  These projects accounted for DKK 606m or 14% of the backlog at the end of Q3  The one-off costs of DKK 323m realised in Q2 cover future losses related to the legacy projects Interim Report Q3 2013 6 November 2013 32
    • Mineral Processing Interim Report Q3 2013 6 November 2013 33
    • Mineral Processing Declining order intake due to mining capex downturn Order intake DKKm 3,500 3,000 2,500 2,000 1,500 1,000 500 0 Revenue (quarterly) -42% vs. Q3 2012 DKKm Announced orders Unannounced orders Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 3,500 3,000 2,500 2,000 1,500 1,000 500 0 (quarterly) +1% vs. Q3 2012 EBITA margin 21% 18% 15% 12% 9% 6% 3% 0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013  Declining order intake and lower tender activity as the market for Mineral Processing remains soft  Stable EBITA margin despite impact by special items  EBITA margin adjusted for special items 11.7% in Q3 Interim Report Q3 2013 6 November 2013 34
    • Mineral Processing Mineral Processing Q3 2013 Q3 2012 Change Q1-Q3 2013 Q1-Q3 2012 Change Full-year 2012 Order intake 1,510 2,598 -42% 4,534 7,851 -42% 10,318 Order backlog 6,749 10,529 -36% 6,749 10,529 -36% 9,589 Revenue 2,393 2,375 +1% 6,880 6,154 12% 9,512 EBITDA 233 240 -3% 676 596 14% 1,079 EBITA 215 215 0% 604 543 11% 1,000 EBITA margin 9.0% 9.1% 8.8% 8.8% EBIT -1771) 164 1231) 3472) -7.4%1) 6.9% 1.8%1) 5.6%2) (DKKm) EBIT margin 10.5% -64% Expected 2013 DKK 9-10bn 8-9% 7732) 8.1%2) 1) Including Ludowici impairment loss of DKK -352 2) Including one-off write-down of capitalized R&D costs in Q2’12 of approximately DKK 60m Interim Report Q3 2013 6 November 2013 35
    • Cement Interim Report Q3 2013 6 November 2013 36
    • Cement Revenue significantly higher than order intake Order intake DKKm 2,500 2,000 Revenue (quarterly) -6% vs. Q3 2012 DKKm +53% vs. Q3 2012 2500 Announced orders Unannounced orders (quarterly) EBITA margin 25% 2000 20% 1,500 1500 15% 1,000 1000 10% 500 500 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 5% 0 0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013  Stable level of unannounced orders – lack of large orders  High revenue & low order intake resulting in declining order backlog  EBITA margin adjusted for special items 6.1% in Q3 Interim Report Q3 2013 6 November 2013 37
    • Cement Cement Q3 2013 Q3 2012 Change Q1-Q3 2013 Q1-Q3 2012 Change Full-year 2012 Order intake 624 667 -6% 2,267 3,984 -43% 4,599 Order backlog 5,706 8,579 -34% 5,706 8,579 -34% 7,585 Revenue 1,385 905 +53% 3,705 2,716 36% 4,214 EBITDA 47 214 -78% 196 471 -58% 788 EBITA 38 208 -82% 168 445 -62% 752 2.7% 23.0% 4.5% 16.4% 31 206 153 3651) 2.2% 22.8% 4.1% 13.4%1) (DKKm) EBITA margin EBIT EBIT margin -85% 17.8% -58% Expected 2013 DKK 5-6bn 5-6% 6691) 15.9%1) 1) Including one-off write-down of capitalized R&D costs in Q2’12 of approximately DKK 60m Interim Report Q3 2013 6 November 2013 38
    • Interim report YTD Financial developments YTD FLSmidth & Co. Q1 -Q3 Q1-Q3 Change A/S 2012 FLSmidth & Co. A/S 2013 2013 (DKKm) Q2 Q2 2012 (DKKm) Order intake 15,295 21,623 -29% Order intake 5,626 7,246 Order backlog 24,595 31,766 -23% Revenue 6,456 5,653 Revenue 19,503 17,889 9% EBITA 287 576 Gross margin 19.6% 25.4% EBITA margin 4.4% 10.2% EBITA 755 1,666 -55% EBIT 195 323 EBITA margin 3.9% 9.3% EBIT margin 3.0% 5.7% EBIT -399 1,244 n/a CFFO -51 333 EBIT margin -2.0% 7.0% Employees2) 14,817 12,717 Net results -605 841 n/a CFFO Employees -234 15,839 -22% +14% 26-28bn -50% -39% 4-5% +17% 188 15,735 Expected 2013 Change -1% Interim Report Q3 2013 6 November 2013 39
    • Interim Report Q3 2013 Distribution of order intake by segment Order intake growth Q3’13 vs. Q3’12 Growth Organic Acquisitions Currency Total Customer Services Material Handling Mineral Processing Cement Order backlog Group -33% -58% -34% -2% -36% 0% 0% 0% 0% 0% -4% --4% -8% -4% -6% -37% -62% -42% -6% -42% DKKm 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 Announced order in Q3 2013: Copper (O&M), Chile, DKK >200m (CS) (quarterly) -23% vs. Q3 2012 Book-to-bill ratio* 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013  Service activities accounted for 53% of Q3 orders  Expected backlog conversion to revenue: 25% in 2013, 44% in 2014 and 31% in 2015 and beyond. O&M** contracts accounted for DKK 5.2bn (21%) of the order backlog at the end of Q3 *) Order backlog divided by Last-Twelve-Months Revenue **) Operation & Maintenance Interim Report Q3 2013 6 November 2013 40
    • Interim Report Q3 2013 Revenue increased 0% in Q3 2013 Revenue DKKm (quarterly) Revenue growth Q3’13 vs. Q3’12 0% vs. Q3 2012 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Growth Organic Acquisitions Currency Total Customer Services Material Handling Mineral Processing Cement Group -6% -12% 9% 57% 7% 0% 0% 0% 0% 0% -6% -7% -8% -4% -7% -12% -19% 1% 53% 0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013  Organic revenue growth of 7% in Q3 2013  Service activities accounted for 34% of Q3 revenue  Pattern of increasing quarterly revenue over the calendar broken in 2013, related to Material Handling and Customer Services Interim Report Q3 2013 6 November 2013 41
    • Interim Report Q3 2013 Revenue and order intake by segment Order intake Q3 2013 Revenue Q3 2013 – classified by segment – classified by segment Cembrit Cement 6% 20% Cement Customer Services 13% 25% Customer Services 43% 15% Mineral Processing 34% Mineral Processing 31% Material Handling 13% Material Handling Interim Report Q3 2013 6 November 2013 42
    • Interim Report Q3 2013 Service activities accounted for 53% of Q3 orders Revenue Q3 2013 Capital Business Service Business 34% Order intake Q3 2013 Capital Business 47% 66% Interim Report Q3 2013 Service Business 53% 6 November 2013 43
    • Interim Report Q3 2013 EBITA by segment EBITA margin Q3 2013 EBITA Q3 2013 – classified by segment – classified by segment 9.0% 215 2.7% 1.7% 38 29 -34 Customer Services Material Mineral Handling Processing -3.1% Cement Customer Services Material Mineral Handling Processing Interim Report Q3 2013 Cement 6 November 2013 44
    • Interim Report Q3 2013 Capital structure developments Equity DKKm -21% vs. Q3 2012 10,000 NIBD (quarterly) Equity ratio Equity ratio target (self-imposed) 50% 8,000 40% 6,000 30% 4,000 20% 2,000 10% 0 0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013 DKKm 6,000 5,000 4,000 3,000 2,000 1,000 0 -1,000 -2,000 (quarterly) Gearing 2.2x EBITDA Gearing target (self-imposed) 2.4 2 1.6 1.2 0.8 0.4 0 -0.4 -0.8 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2012 2012 2012 2012 2013 2013 2013  The equity ratio declined and the gearing increased as a result of the special items booked in Q3 Interim Report Q3 2013 6 November 2013 45
    • Interim Report Q3 2013 Number of employees  Number of employees decreased by 142 in Q3 (from 15,877 to 15,735) Number of employees Q3’13 vs. Q3’12 - by segment  820 employees have been given notice by the end of Q3  Developments in divisional numbers are impacted by allocation of group staff 5,835 5,916 3,352 3,413 Q3’13 Q2312 Q3’13 Customer Services Material Handling Q3’12 2,984 2,994 Q3’12 Q2313 Mineral Processing Interim Report Q3 2013 2,567 2,331 Q3’12 Q3’13 Cement 6 November 2013 46