121016 investor presentation final

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TOMRA creates sensor-based solutions for optimal resource productivity.

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121016 investor presentation final

  1. 1. TOMRAINVESTORPRESENTATION TOMRA SYSTEMS ASA 19th October 2012
  2. 2. TOMRA was founded on an innovation in 1972that began with design, manufacturing and saleof reverse vending machines (RVMs) for automatedcollection of used beverage containers 2
  3. 3. Today, TOMRA creates sensor-based solutions foroptimal resource productivity – helping our customersincrease their financial results and reduce theirenvironmental impact 3
  4. 4. TOMRA has installations in over 80 marketsworldwide and had total revenue of ~3.7 billion*NOK in 2011TOMRA has ~2,200 employees and is publicly listedon the Oslo Stock Exchange* Excluding BEST 4
  5. 5. The TOMRA Group continues to innovate andprovide cutting-edge solutions for optimal resourceproductivity within two main business areas:Collection Solutions (reverse vending, materialrecovery and compaction)Sorting Solutions (recycling, mining and food) 5
  6. 6. “A TINY BLUE AND GREEN OASIS OF LIFE INA COLD UNIVERSE.” – DAVID SUZUKI
  7. 7. THE WORLD POPULATION AND STANDARDOF LIVING IS INCREASING DRAMATICALLY
  8. 8. WORLD RESOURCES ARE UNDERUNPRECEDENTED PRESSURE
  9. 9. RESOURCE PRODUCTIVITY MUST INCREASETO ENSURE SUSTAINABLE DEVELOPMENT
  10. 10. THE DAWN OF THE RESOURCE REVOLUTIONSOURCE: McKinsey 10
  11. 11. The resource revolution is abouttransforming how we obtain, use, and reuse resourcesfor sustainable economic growth and improved qualityof life for all. 11
  12. 12. At TOMRA we have always thought this way.From inventing the world’s first reverse vendingmachine in 1972 to providing the mostinnovative sensor-based sorting systems today. 12
  13. 13. TOMRA IS TRANSFORMING HOWWE OBTAIN OUR RESOURCES…
  14. 14. Our sorters can reduce water consumptionwith 3-4 cubic meters per ton oreOur sorters can reduce energy consumptionin mining by 15%Our sorters can increase recovery of valuableminerals by up to 25% 14
  15. 15. TOMRA IS TRANSFORMING HOWWE USE OUR RESOURCES…
  16. 16. Our optical sorters can analyze 25 tons of product perhour, maximizing yield and recovery while reducingwaste, energy, and chemical useWe recover 5% - 10% of the produce, through higher yields andbetter utilization, reducing pressure on the food chainThat’s approximately 25,000 trucks per year in potatoes alone 16
  17. 17. TOMRA IS TRANSFORMING HOWWE REUSE OUR RESOURCES…
  18. 18. 30 billion used beverage containers are every yearcaptured by our reverse vending machinesOur optical waste sorter can analyze and sort a footballstadium covered with waste in less than 15 minutes715,000 tons of metal is recovered every year byour metal recycling machinesOur vertical balers enable daily savings of ~20,000transport movements, 160,000 liters of fuel andup to 50% of customers’ waste handling costs 18
  19. 19. TOMRA CREATES SENSOR-BASED SOLUTIONS FOROPTIMAL RESOURCE PRODUCTIVITY
  20. 20. Today we see more opportunities for optimalresource productivity than ever before 20
  21. 21. WASTE INTO VALUE…
  22. 22. YIELD INTO USAGE…
  23. 23. SOURCE INTO RESOURCE…
  24. 24. PURPOSE INTO PROFITS…
  25. 25. PROFITS INTO PROGRESS…
  26. 26. TOMRA invests 8% of its yearly revenue in R&D, toprogress and create solutions to move past the falsechoice between the earth and the economy 26
  27. 27. TOMRA: Leading the resource revolution 27
  28. 28. TOMRA IN SHORT
  29. 29. THE TOMRA TRANSFORMATION JOURNEY 2000 2004 2008 2012FROM: TO: 5% 16% 40% 100% 95% 84% 60% Collection Collection CollectionA house of Collection A branded brands Sorting Sorting Sorting house 29
  30. 30. CREATING VALUE THROUGH TWO STRONG BUSINESSAREAS Sorting Solutions Two strong areas for value creation A larger part of TOMRA 40% 60% • Stable • High growth • High margins • High margins Collection Sorting • Low cyclicality • Medium cyclicality High technology - sustainable businessSource: Rounded proforma figures after acquisition 30
  31. 31. TOMRA’S TWO BUSINESS AREAS* TOMRA Collection Solutions TOMRA Sorting Solutions Reverse Vending Machines RecyclingKey activities Sale and service of solutions for automated collection of used beverage High speed identifying, sorting and processing of information: containers with deposit in retail stores material, shape, size, color, defect, damage and location of objectsShare of ‘11 sales ~46% ~11%Employees 960 175Customers Grocery retailers Material recovery facilities, scrap dealers, metal shredder operatorsMarket share ~65% ~50-60% Compaction MiningKey activities On of the world’s largest manufacturer The leading provider of sensor-based of vertical balers sorting systems for the mining industryShare of ‘11 sales ~4% ~3%Employees 75 50Customers Retail, manufacturing industry, restaurant, catering & hotel, warehouse & distribution Mining companiesMarket share ~15-20% in active markets ~40-60% Material Recovery FoodKey activities Pick-up, transportation and processing of used beverage containers and Optical sorting and processing operation of a network of collection sites in USA solutions for foodShare of ‘11 sales ~13% Odenberg: ~7% (acquired in 2011) / BEST: ~16% (acquired in 2012)Employees 400 Odenberg: 175 / BEST: 310Customers Grocery retailers and beverage manufacturers Food growers, packers and processorsMarket share ~60% in USA (markets served) ~25%* Proforma 2011 as if BEST should have been part of TOMRA 31
  32. 32. TOMRA INSTALLED BASETOMRA Collection Solutions TOMRA Sorting Solutions INSTALLED UNITS INSTALLED UNITS INSTALLED UNITS INSTALLED UNITS INSTALLED UNITS INSTALLED UNITS Nordic ~15,000 Nordic ~16,000 Europe 1850 Europe 70 Europe ~1,150 Europe ~1,950 Germany ~23,000 UK ~17,000 Asia 220 US / Canada 35 US/Canada ~1,350 US/Canada ~1,050 Other Europe ~12,000 Other Europe ~26,000 US / Canada 500 Australia 20 Asia ~120 Asia/Oceania ~330 Japan ~500 Asia/Oceania ~4,000 Other 380 South Africa 45 Other ~100 South America ~120 North America ~15,000 North America ~4,000 Other 20 Middle East/ ~350 South America ~1000 Middle East/Africa ~500 Africa TOTAL ~67,000 TOTAL ~67,500 TOTAL 2,950 TOTAL 190 TOTAL ~2,720 TOTAL ~3,800 32
  33. 33. USING THE POWER OF BUSINESS TO DO GOOD EMPLOYEES ETHICAL BUSINESS BEHAVIOUR • 81% of our employees say • Member of UN Global Compact TOMRA is a “Great Place to since end 2009 Work” • Implementing ethical policies worldwide ENVIRONMENT INCREASING CUSTOMER VALUES • We contribute to avoided emissions of • Productivity about ~10mill tons • Revenues CO2 annually • Quality 33
  34. 34. TOMRA IN DEPTH
  35. 35. TOMRA Collection Solutions 35
  36. 36. TOMRA REVERSE VENDING– TRANSFORMING BEHAVIOR
  37. 37. THE USED BEVERAGE CONTAINER RECYCLINGVALUE CHAINGeneric used beverage container (UBC) recycling value chainRVM-based UBC recycling value chain RVM SERVICE/ DATA ADMIN/ MATERIAL MATERIAL MATERIAL MATERIAL TECHNOLOGY SUPPORT CLEARING PICK-UP PROCESSING BROKERAGE RECYCLING 37
  38. 38. RVM PRODUCT PORTFOLIO 38
  39. 39. RVM VALUE PROPOSITION • RVMs reduce need for manual labour and will typically have a payback period of 12-18 Reduced costs months for medium sized stores • Improved logistics and handling • RVMs keep track of all deposit transactions – in Germany alone the total transaction volume Clearing of has an annual value in excess of ~4 bn EUR deposits • RVMs have several fraud detection features to prevent paying out deposit on non-eligible containers • RVMs make it convenient and easy for High consumers to return their empty containers consumer convenience • RVMs are clean and efficient and ensure correct redemption of containers 39
  40. 40. MARKET STRUCTURES AND BUSINESS MODELS Mandatory • Non-refillables account for 75% of all containers sold and are popular due to 1 (non-refillable) simplified distribution/manufacturing and consumer marketing aspects deposit markets • Some markets have MANDATORY deposit systems to ensure proper collection of containers • RVMs are used to make these systems more effective and efficient Voluntary (refillable) • Refillable containers account for ~25% of all containers sold and have traditionally 2 deposit markets been used by local and regional breweries outside NA • Refillable containers are typically part of a VOLUNTARY deposit system to incentivize consumers to return containers for reuse • RVMs are used to make this system more effective and efficient Other incentive-based • In markets without deposit there might still be a need to organize collection of 3 markets empty containers, either to support overall recycling targets/ambitions or to (non-deposit) demonstrate corporate social responsibility • Although the rationale for using RVMs varies from market to market, RVMs can in general be used to facilitate the collection process 40
  41. 41. COMPETITIVE LANDSCAPE Annual revenue from RVM >65,000 … Number of installed RVMs 10,000-20,000 2,500-5,000 <2,500 1-5 6-10 11-20 21-30 >30 Number of RVM marketsSource: TOMRA estimates and analysis 41
  42. 42. TOMRA COLLECTION: OUR STRATEGY 1 Protect and defend • Cost leadership existing business • Increased differentiation Spur growth in • Accelerated machine replacement 2 existing markets • Incremental revenue streams on installed base • New deposit markets 3 Succeed in new markets • Viable non-deposit business models 42
  43. 43. COST LEADERSHIP AMBITION Overall ambition to reduce COGS on new RVMs by 40% from 2010 to 2015 20% by aggressive sourcing and production strategy • 70% of sourcing from low-cost countries • Flexible and quicker assembly close to main markets 15% by technology and design for low cost manufacturing • Modularity – building block principle • Smarter design , e.g. combining processors and sensors 5% by other means • New production techniques • Automation • Volume 43
  44. 44. RECENT TOMRA INNOVATIONS T-820 Touch MultiPac SoftDrop MK3 Flake Setting new standards in Taking uptime to new levels Enabling simpler store Boosting operational uptime usability for operations and logistical efficiency consumer, owner and operator TOMRAPlus DMR Doublefeed A new management tool for Minimizing border fraud Customer-specific solution proactive admin of your issues in Michigan enabling space-efficient reverse vending systems operations 44
  45. 45. PRESENT AND PROSPECTIVE DEPOSIT SCHEMESCanada EuropeSaskatchewan Norway ScotlandManitoba Iceland SpainAlberta FinlandOntario SwedenNorthwest Territories Croatia Czech RepublicNunavut Germany MontenegroYukon Denmark SerbiaPrince Edward Island Netherlands LithuaniaNova Scotia Israel LatviaNew Brunswick EstoniaNewfoundlandQuebecUSA AustraliaCalifornia Florida Northern TerritoryOregon Georgia South AustraliaConneticut North CarolinaNew York Virginia General AustraliaMassachusettes KentuckyVermont MissouriMaineHawaiiIowaMichigan States / provinces with a States / provinces in States / provinces in running deposit system advanced discussion Initial discussions 45
  46. 46. TOMRA Sorting Solutions 46
  47. 47. STRONG REVENUE GROWTH SINCE INCEPTION IN 1996 • Total revenue growth (organic plusRevenue development and key milestones Acquired 31st of May 2012 inorganic) of ~35% per year fromEUR million 2004-11 — Organic growth for the same period was ~22% Ultrasort acquired Odenberg • Technology base and acquired segment/application knowledge expanded both through acquisitions and in-house ventures >120 CommoDas • Growth driven by: acquired − Price increases in food, commodities & landfill costs TITECH Real Vision TITECH Visionsort AS Systems acquired by − Favorable changes in regulatory established acquired TOMRA framework (DSD, WEEE, ELV, etc) QVision AS − Strong sales and service network 14.5 0.5 established − Technology leadership − Higher quality and food safety1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 demands 47
  48. 48. OUR CORE TECHNOLOGY: THE EYES AND BRAINS OFSORTING AND PROCESSING • High-tech sensors are utilized to identify objects on a conveyor belt • High speed processing of information: material, shape, size, color, defect, damage and location of objects • Precise sorting by air jets or mechanical fingers 48
  49. 49. A COMMON SENSOR BASED TECHNOLOGY PORTFOLIO Sensor/ Material Property Segment [m] Technology 10-12 RM (Radiometric) Natural Gamma Radiation Mining Gamma- 10-11 radiation 10-10 XRT (X-ray transmission) Atomic Density Recycling, Mining, Food Low Energy X-ray X-ray 10-9 10-8 XRF X ray fluorescence (Elemental Recycling, Mining Ultraviolett (UV) 10-7 Spectroscopy) 10-6 COLOR (CCD Color Camera) Reflection, Absorption, Recycling, Mining, Food Visible light (VIS) 10-5 Transmission 10-4Near Infrared (NIR) Laser attenuation and Monochromatic Reflection Mining, Food 10-3 PM (Photometric) /Absorption of Laser Light Infrarot (IR) 10-2 Scattering analysis of Laser Light Microwaves 10-1 NIR / MIR (Near/Medium Reflection, Absorption Recycling, Mining, Food Infrared Spectrometry) (Molecular Spectroscopy) 101 LIBS Laser induced breakdown Recycling, Mining Radio waves 102 spectroscopy 103Alternating current EM (Electro- Conductivity, Recycling, Mining, Food 104 (AC) Magnetic sensor) permeability 49
  50. 50. CUTTING-EDGE TECHNOLOGY DRIVEN BYSIGNIFICANT INVESTMENTS IN R&D SENSOR PORTFOLIO • In-house R & D department with more than 305 peopleElectromagnetic Sensor (EM) Radiometry (RM)Material property detected: Material property detected: • Partnership with leading R&Delectromagnetic properties like radioactivityconductivity and permeability institutions: SINTEF, CTR, Fraunhofer ILT; universities like RWTH and BrusselsCCD Color Camera (COLOR) IR Camera (IR) • 8% of revenue invested in R&D Material property detected: heatMaterial property detected:color properties in the color are conductivity and heat dissipation • 15 test centers worldwideas red, green and blueX-ray Transmission (XRT) X-ray Fluorescence (XRF)Material property detected: specific Material Property detected:atomic density irrespective of size, elemental compositionmoisture or pollution levelVisible Light Spectrometry (VIS) Near-Infrared Spectrometry (NIR)Material property detected: visible Material property detected: specific andspectrum for transparent and opaque unique spectral properties of reflectedmaterials light in the near-infrared spectrumLaser Infrared Transmission (IRT)Material property detected: Material property detected:scattering of laser light light absorption Test center in Koblenz, Germany 50
  51. 51. WHY SENSOR-BASED SORTING? • Increase purity of • Increaserecovery of • Increase yieldINCREASE sellable materials valuable metals, minerals, • Increase throughputREVENUES • Increase recovery rate diamonds and gems from ores • Increase capacity • New technology give access to old dumpsREDUCE • Reduce labor • Reduce energy • Reduce laborCOSTS requirements consumption requirements • Lower operating and • Reduce water consumption • Lower operating and service costs • Less wear and tear service costs • Less rocks needs crushing • Reduce wasteOTHER • Consistentquality of • Less environmental impact • Food safetyBENEFITS output streams • Reduce carbon footprint • Increased and consistent • Increaseflexibility of • Easier permitting quality and safety production line • Increased flexibility of • Monitor material production line composition • Production reporting and analysis 51 a part of TOMRA
  52. 52. ADOPTION OF SENSOR-BASED SORTING AT DIFFERENTMATURITY LEVELSMaturity/industryadoption FOOD RECYCLING MINING* Time * In certain mining sub-segments, such as industrial minerals and diamonds, sensor-based sorting is a more mature technology. 52
  53. 53. MARKET SIZE AND POTENTIALTotal annual market size for different sensor-based sorting segmentsEUR million ~850-900 ~500-550 Food 650 Mining Metal 400 Waste 60 20 70 40 90 50 2010 2015 Source: TOMRA estimates and analysis 53
  54. 54. TOMRA SORTING: OUR STRATEGY • Aggressively target promising regions and markets 1 Expand geographically • Leverage market presence across entire portfolio • Continue to invest heavily in R&D 2 Maintain technology leadership position • Bring new and enabling technology to the market • Further develop web of partners • Utilize our market leader position to maximize economies of scale effect 3 Cost leadership • Effective sourcing in combination with product friendly R&D M&A to consolidate market • New verticals/business streams in sensor-based sorting 4 and enter new business • Increase footprint and scale through consolidation streams • *Now added through latest acquisition of BEST* 54
  55. 55. TOMRA SORTING FOOD –SECURING QUALITY, EFFICIENCY, AND PRODUCTIVITY
  56. 56. AFTER ACQUIRING BEST TOMRA HAS A BROADFOOTPRINT WITHIN THE FOOD SORTING UNIVERSE #1 #1 SK NDF PFV FV FF Other Seeds & Nuts & Processed Fresh Fresh Fruits Confectionary, Kernels Dried Fruit Fruits & Veg Vegetables etc. Circa 40%* of annual Circa 30%* of annual Circa 25%* of Circa 5%* of global sorter sales global sorter sales annual global annual global revenue revenue sorter sales sorter sales revenue revenue* TOMRA estimates 56
  57. 57. FOOD: APPLICATIONS AND SENSOR TECHNOLOGY POTATO FRUIT VEGETABLE MEAT/SEAFOODFOOD • Whole • Tomato • Beet • Beef • Field • Citrus • Corn • Pork • Seed • Dried fruits • Carrot • Seafood • Table/ware • Nuts • Green bean • Sweet • Peach & pear • Jalapenos/ • Processed Pepper • Peeled • Onion • Pickles • CucumbersSENSOR NIR NIR NIR NIRTECHNOLOGY VIS VIS VIS VIS DRIED FRUIT NUTS FRESH CUT FRUIT VEGETABLES POTATO SEAFOODFOOD • Apricots • Almonds • Iceberg • Apples • Peas • Chips • Scallops • Raisins • Cashews • Mixed salad • Apricots • Beans • Flakes • Mussels • Figs • Hazelnuts • Leaves • Blackberries • Broccoli • French fries • Shrimp • Prunes • Macademias • Spinach • Blueberries • Carrots • Craisins • Peanuts • Spring Mix • Cherries • Corn • Pecans • Cranberries • Garlic • Pistachios • Pineapple • Mixed vegetables • Seeds • Raspberries • Walnuts • StrawberriesSENSOR LASER LASER LASER LASER CAMERA LASER LASER CAMERATECHNOLOGY X-RAY X-RAY CAMERA CAMERA LASER / FLUO CAMERA X-RAY 57
  58. 58. SORTING UNWASHED POTATOES: WORKING PRINCIPLE • The Field Potato Sorter is ODENBERG’s first venture into the unwashed potato market • The machine uses unique near infra-red technology to remove soil clods, stones and rotten potatoes, in addition to the foreign material commonly found in fields such as golf balls, plastics, wood etc • The FPS sorter should be used after a soil remover and is designed to fit existing grading equipment or be used as a standalone unit and can operate on harvested potato crop before and after storage • The system also provides online potato size data for logging, plus sorter operating information 58
  59. 59. FROM FARM TO FORK PROVIDING SOLUTIONS THROUGHOUT THE VALUE CHAIN 59
  60. 60. VALUE PROPOSITION • Up to 100% reduction on manual labor alternative Operational • Productivity Increase ~ 20% Efficiency • In many cases sorting cannot be completed manually due Reduces to product size or defect types Costs • Yield improvement > 1.5% • Protects customers reputations. Automated control Assured helps protect against ‘undesirables’ or ‘harmful’ items Consumer entering the food chain. Mitigates against the ‘cost’ and Food Quality damage of failure, recalls, etc & Safety • Legislation for food quality becoming more and more demanding with full traceability • High precision and multiple sort grades (by size & quality) maximizes raw product utilization and product sales value Increases • Easy to achieve customer requirements regardless of Revenue incoming product quality. • Analyses the crop quality, size and line efficiency as it sorts. Provides real time data to customers to become more productive (effective real time control), maximizing yield and select/monitor suppliers. 60
  61. 61. FOOD: SORTING MARKET SIZE AND POTENTIAL* Total annual market size EUR million Growth potential • Market expected to grow at an annual rate of 5-8% overall Drivers • More sophisticated and demanding consumers with more disposable income and changing eating habits • Tendency to more processed, packed and frozen food supporting maximum customer convenience and globalization of brands & products of processed food 650-750 • Food supply constraints calls for optimal resources productivity 500 • More focus on food safety, sorting out foreign objects • Consolidation in the retail and processing sectors − Improving yield and quality − Reducing labor costs • Globalization & increasing export − Verifiable quality & safety processes 2012 2017 − Traceability Requirements Source: TOMRA estimates and analysis* Updated after BEST acqusition 61
  62. 62. STRENGTHENING OF MARKET POSITIONING AFTERACQUISITION OF BESTSize and presence – Before BEST Size and presence – New positioning >3,000 >3,500 # of installed machines # of installed machines 1,000- 1,000- 3,500 3,500 0-1,000 0-1,000 10-25 25-50 >50 10-25 25-50 >50 markets markets markets markets markets markets Geographic presence Geographic presence Revenue from sensor-based sortingSource: TOMRA estimates and analysis 62
  63. 63. TOMRA SORTING RECYCLING -TRANSFORMING EFFICIENCY AND QUALITY
  64. 64. RECYCLING: APPLICATIONS AND SENSOR TECHNOLOGY HOUSEHOLD AUTOMOBILE ELECTRONIC WASTE PACKAGING C&D SHREDDER SCRAP MATERIAL • Hard plastics • Plastics • Inert material • NF metal • Printed circuit • Plastic film • Plastic film • Plastic film • Stainless steel boards • Mixed paper • Cardboard • Metals • Copper cables • Non-ferrous metal concentrates • RDF • Mixed paper • Wood • Copper • Metals • Deinking paper • Paper & • Brass • Cables • Organics/ • Metal Cardboard • Aluminum • Copper Biomass • Plastics • Meatball sorting • Brass • Stainless steel • Meatball sorting SENSOR NIR NIR NIR NIR XRT TECHNOLOGY VIS VIS VIS VIS EM XRT EM XRT XRT NIR EM EM COLOR COLOR XRF XRF Mixed paper PE/PP flakes Cleaned wood Copper Wire Brass 64
  65. 65. AUTOMATED WITH TOMRA SORTING UNITS NIR for packaging waste BalerFocus on the PET stream, PP Mixed Paper cleaning PE Colored PE Natural ONP Cleaning PET Manual sorting for oversize materials Sorting of Municipal Solid Waste, Cyprus ONP DoublePackaging Deck Screen Ballistics (removing films) Input 65
  66. 66. RECYCLING: VALUE PROPOSITION • Reduces manual labor by up to 75 % • Low operating and maintenance costs and Reduces reduced space requirements costs • Avoids high turnover of personnel • High precision Increases • Easy to adapt to changing needs and sorting revenues tasks • High volume sorting Ensures consistent, s • Machines enables longer hour operations table and • Reduced accidents and less strain on staff fast operations • Constant quality and performance • Some sorting tasks impossible/difficult for manual sorters 66
  67. 67. RECYCLING: SORTING MARKET SIZE AND POTENTIALTotal annual market sizeEUR million Growth potential 160 • Market expected to grow at an annual rate of 10-15% overall • TITECH expects to maintain its overall 70 market share 90 Drivers • Increased demand for raw material 40 • Higher labor costs • Higher commodity prices 90 • Legislation (landfills, ELV, WEEE etc.) 50 • Adoption of technology in new markets (Asia, Latin America, Eastern Europe) • New applications such as flake sorting 2010 2015 Waste MetalSource: TOMRA estimates and analysis 67
  68. 68. RECYCLING COMPETITIVE LANDSCAPE Waste recycling Metal recycling High HighCost advantage Cost advantage Low Low Low High Low High Technological advantage Technological advantage Source: TOMRA analysis 68
  69. 69. TOMRA SORTING MINING– FINDING MINDFUL SOLUTIONS
  70. 70. MINING: APPLICATIONS AND SENSOR TECHNOLOGY INDUSTRIAL BASE & FUEL/ PRECIOUS DIAMONDS MINERALS Fe METALS ENERGY METALS & GEMS METAL SLAG COMMODITY • Calcite •Copper • Coal • Gold • Diamonds • Stainless steel • Quarts • Zinc • Uranium • Platinum • Tanzanite • Copper • Feldspar • Nickel • Colored • Chrome • Magnesite • Tungsten gemstones • Talcum • Iron • Dolomite • Manganese • Salt • Chromite SENSOR COLOR XRT XRT XRT COLOR XRT TECHNOLOGY XRT COLOR RM COLOR XRT XRF NIR EM XRF XRF EM XRF NIR NIR NIR Calcite Copper Coal Gold Diamonds Ferro Silica Slag 70
  71. 71. THE CONCEPT OF SENSOR-BASED SORTING IN MINING Run of Mine Primary Crushing Sensor Based Sorting Beneficiation Plant Milling Screening DMS Flotation Facts (estimated) • 15% to 50% of the ROM can be rejected in an Tailings (fines) early stage of the process (application dependent) • These low grade waste rocks don’t need to be crushed, grinded and further treated Product 71
  72. 72. MINING: VALUE PROPOSITION • Lower head grade can be processed Increased access to • Better utilization of existing deposits resources • Old dumps turn into resources • Significant capacity increase of the traditional beneficiation plant Cost savings • Energy costs savings • Less wear and tear and chemicals costs Environ- • Better carbon footprint mental • Reduction of acid mine drainage benefits • Less pollution 72
  73. 73. MINING: SORTING MARKET SIZE AND POTENTIALTotal annual market sizeEUR million Growth Potential • Market expected to grow at an annual rate of around 20-30% overall • Commodas Ultrasort expects to maintain its overall market share 60 Drivers • Increasing demand for commodities from emerging markets • Increased pressure on costs but 20 high/increasing energy and water costs 2010 2015Source: TOMRA estimates and analysis 73
  74. 74. MINING COMPETITIVE LANDSCAPE High Cost advantage Low Low High Technological advantageSource: TOMRA analysis 74
  75. 75. Financial performance and targets 75
  76. 76. KEY FINANCIALS DEVELOPMENT Revenues Gross Contribution and margin 4,000 1,800 46% 3,500 1,600 44% 3,000 1,400 42% 1,200 2,500 40%NOKm NOKm 1,000 2,000 38% 800 1,500 36% 600 1,000 400 34% 500 200 32% 0 0 30% 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 EBITA and margin Earnings per share 800 20% 3.0 700 18% 2.5 600 NOK per share 2.0 500 16%NOKm 400 1.5 300 14% 1.0 200 12% 0.5 100 0 10% 0.0 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 76
  77. 77. FINANCIAL HIGHLIGHTSBALANCE SHEET, CASH FLOW AND CAPITAL STRUCTURE 30 Sept 30 Sept 31 Dec Ordinary cashflow from operationsAmounts in NOK million 2012 2011 2011 • 181 MNOK in 3Q 2012 versus 299ASSETS 5,346 4,138 3,999 MNOK in 3Q 2011• Intangible non-current assets 2,328 1,405 1,391 Cashflow from investments• Tangible non-current assets 551 567 527 • Minus 939 MNOK, of which• Financial non-current assets 272 286 264 893 MNOK relates to the• Inventory 826 639 627 acquisition of BEST.• Receivables 1,273 1,122 1,012 Solidity• Cash and cash equivalents 96 119 178 • 42% equityLIABILITIES AND EQUITY 5,346 4,138 3,999 • NIBD/EBITDA = 1.9 (Rolling 12 months)• Equity 2,142 2,030 2,141• Minority interest 78 80 76 BEST Kwadraat NV• Interest bearing liabilities 1,641 782 741 • Fully consolidated from 2 July 2012• Non-interest bearing liabilities 1,485 1,246 1,041 77
  78. 78. FINANCING Utilized 1641 MNOK 2000 1800 50 Committed and uncommitted credit lines 50 1600 Eksportfinans (A) DNB (B) DNB/SEB (C) 1400 750 C Type 3 year term loan 5 year revolving 3 year revolving creditInterest bearing debt credit facility facility 1200 Established July 2011 January 2011 July 2012 1000 Expire July 2014 January 2016 July 2015 Amount NOK 500 million NOK 500 million EUR 100 million 800 (~NOK 750 million) 500 B Repayment Bullet Bullet Bullet 600 Interest Floating, 3m Floating, 1-12 m Floating, 1-9 m 400 Margin 52 bps above NIBOR 60 - 90 bps above 110 – 165 above NIBOR/EURIBOR EURIBOR 500 A Pledge Negative Negative Negative 200 Covenants 30% Equity 30% Equity 30% Equity 0 78
  79. 79. CURRENCY EXPOSURE Revenues and expenses per currency; NOTE: Rounded figures EUR* USD NOK SEK OTHER TOTAL Revenues 50 % 30 % 5% 10 % 5% 100 % Expenses 45 % 25 % 15 % 10 % 5% 100 % EBITA 80% 60 % - 55 % 10 % 5% 100 % * EUR includes DKK 10% change in NOK towards other currencies will impact; Revenues Expenses EBITA EUR* 5.0% 4.5% 8.0% HEDGING POLICY • TOMRA hedges B/S items that will have USD 3.0% 2.5% 6.0% P/L impact on currency fluctuations SEK 1.0% 1.0% 1.0% • TOMRA can hedge up to one year of future predicted cash flows. Gains and OTHER 0.5% 0.5% 0.5% losses on these hedges are recorded in ALL 9.5% 8.5% 15.5% the finance line, not influencing EBITA* EUR includes DKK 79
  80. 80. COLLECTION SOLUTIONS –SEGMENT FINANCIALSRevenue development Gross and EBITA margin developmentNOK million Percent3000 50 45 41 42 412500 38 39 40 352000 301500 25 19 20 16 161000 13 13 15 10 500 5 0 0 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 Q1 Q2 Q3 Q4 Full year GM EBITA 80
  81. 81. COLLECTION SOLUTIONS –FINANCIAL DASHBOARD Material Material RVM Orwak RVM Orwak Recovery Recovery DashboardIndustry growth Market share 0-5% 0-3% 3-5% 65% 80% 25% GeographicalRecurring diversityrevenue ~75% 90-100% 25% 20-30 markets 10 markets 30 marketsProfitability Cyclicality(ROCE) ~35% ~15% 10-15% Low Low MediumTARGETS 2010 -2015Yearly growth 4 – 8%40% reduced COGS on new RVM machines from 2010 to 2015EBITA-margin 17%-22% 81
  82. 82. SORTING SOLUTIONS –SEGMENT FINANCIALSRevenue development Gross and EBITA margin developmentNOK million Percent1000 70 64 62 62 900 58 60 54 800 700 50 600 40 500 28 30 26 400 22 300 17 18 20 200 10 100 0 0 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 Q1 Q2 Q3 Q4 Full year GM EBITA 82
  83. 83. FINANCIAL DASHBOARD –SORTING SOLUTIONS Dashboard Recycling Mining Food Industry Market share Growth 10-15% 50-60 % 40-60 % 25% Recurring Geographical revenue diversity 10-15% 40-50 markets 20-30 markets 45-50 markets Profitability (ROCE) 30-40% Cyclicality High High MediumTARGETS 2010 -2015Yearly organic growth 10-15%Geographical expansionEBITA-margin 18-23% 83
  84. 84. 84 3Q12 2Q12 1Q12 4Q11 3Q11 2Q11 1Q11 4Q10 3Q10 2Q10 1Q10 4Q09 3Q09 2Q09 1Q09ORDER BACKLOG DEVELOPMENT 4Q08 3Q08 Tomra Sorting 2Q08 1Q08 4Q07 3Q07 2Q07 1Q07 4Q06 3Q06 2Q06 1Q06 4Q05 3Q05 2Q05 1Q05 4Q04 3Q04 2Q04 1Q04 600 500 400 300 200 100 0 NOK million
  85. 85. Appendices 85
  86. 86. TOMRA MATERIAL RECOVERY– TRANSFORMING EFFICIENCY
  87. 87. TOMRA’S INTEGRATED VALUE CHAIN IN NORTHAMERICA RVM SERVICE/ DATA ADMIN./ MATERIAL MATERIAL MATERIAL TECHNOLOGY SUPPORT CLEARING HOUSE PICK-UP PROCESSING BROKERAGE RVM BUSINESS MATERIAL RECOVERY BUSINESS In the US, offering an integrated solution to the customer is required in order to sell RVM technology 87
  88. 88. MID-WEST, EAST COAST & QUEBEC OPERATIONSIn addition to RVM sales/service, TOMRA is • ~560 MNOK in revenues inalso involved in: 2011 • Own transportation network• Logistics management: in some states, outsourced Pick-up and transportation to 3rd parties in other states of collected containers • Processing of UBCs in own• Material processing: facilities plus outsourced Sorting, cleaning, shredding/flaking/ facilities crushing and baling materials into recyclable fractions • Annual volumes processed (pounds):• Material marketing/trading: Sale and – Alu 130+ mill. trading of processed materials on behalf of – Glass 500+ mill. industry, – Plastic 130+ mill which owns the collected materialsBottlers pay a fee to TOMRA linkedto volume of containers picked-up, processedand marketed 88
  89. 89. TOMRA COMPACTION– SMALL SPACES CREATE BIG SOLUTIONS
  90. 90. VALUE CHAIN IN THE BUSINESS STREAM COMPACTION SORTING AND PICK-UP: TO RECYCLING MATERIAL COMPACTION BALES AND STATION OR RECYCLING AT SOURCE BRIQUETTES RECYCLING PLANT 90
  91. 91. COMPACTION: THE CONCEPT 91
  92. 92. MARKET SEGMENTSThe four main market segments: Revenue breakdown on customer segments: Public Fast inst. food, service, ot her FOOD RETAIL NON-FOOD RETAIL Waste International 6 Management 3 food retailers 8 28 25 Industry 13 Regional food retailers MANUFACTURING HOTELS AND 17 INDUSTRY RESTAURANTS Non-food retailers 92
  93. 93. TOMRA - taking a bigger role in theresource revolution 93
  94. 94. DISCLAIMERCopyrightThe material in this Document (which may be a presentation, video, brochure or other material), hereafter called Document , includingcopy, photographs, drawings and other images, remains the property of TOMRA Systems ASA or third party contributors where appropriate. No part of thisDocument may be reproduced or used in any form without express written prior permission from TOMRA Systems ASA and applicable acknowledgements.No trademark, copyright or other notice shall be altered or removed from any reproductionDisclaimerThis Document (which may be a presentation, video, brochure or other material), hereafter called Document, may include and be based on, interalia, forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. The content of thisDocument may be based on current expectations, estimates and projections about global economic conditions, including the economic conditions of theregions and industries that are major markets for TOMRA Systems ASA and its subsidiaries and affiliates. These expectations, estimates and projectionsare generally identifiable by statements containing words such as “expects”, “believes”, “estimates” or similar expressions, if not part of what could beclearly characterized as a demonstration case. Important factors that could cause actual results to differ materially from those expectations include, amongothers, changes in economic and market conditions in the geographic areas and industries that are or will be major markets for TOMRA Systems ASA.Although TOMRA Systems ASA believes that its expectations and the Document are based upon reasonable assumptions, it can give no assurance thatthose expectations will be achieved or that the actual results will be as set out in the Document. TOMRA Systems ASA does not guarantee theaccuracy, reliability or completeness of the Document, and TOMRA Systems ASA (including its directors, officers and employees) accepts no liabilitywhatsoever for any direct or consequential loss arising from the use of this Document or its contents. TOMRA Systems ASA consists of many legallyindependent entities, constituting their own separate identities. TOMRA is used as the common brand or trade mark for most of these entities. In thisDocument we may sometimes use “TOMRA”, “TOMRA Systems”, “we” or “us” when we refer to TOMRA Systems ASA companies in general or where nouseful purpose is served by identifying any particular TOMRA Company 94

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