Result presentation Q2 2014

1. © Wärtsilä
WÄRTSILÄ CORPORATION
INTERIM REPORT JANUARY-JUNE 2014
18 JULY 2014
Björn Rosengren,
President & CEO

2. • Order intake EUR 1,163 million, +9%
• Net sales EUR 1,132 million, -2%
• Book-to-bill 1.03
• EBIT EUR 122 million, 10.8% of net sales
(EUR 111 million or 9.6%)
• EPS EUR 0.42 (0.39)
• Prospects revised:
EBIT% before non-recurring items expected to be
around 11.5%, net sales to grow by around 5%
• Establishment of two joint ventures with China
State Shipbuilding Corporation announced in July
EBIT is shown excluding non-recurring items.
Highlights Q2/2014
NEW
PIC
2 © Wärtsilä

3. © Wärtsilä
0
200
400
600
800
1000
1200
1400
Q2/2013 Q2/2014
9%
12%
6%
9%
1,071
MEUR
Second quarter development
MEUR
3
Order intake supported by Ship Power and Services
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
5500
2010 2011 2012 2013 1-6/2014
1,163
Q1-Q2 Q3-Q4
Power Plants
Ship Power
Services

4. © Wärtsilä
0
200
400
600
800
1000
1200
Q2/2013 Q2/2014
Net sales in line with our expectations
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
2010 2011 2012 2013 1-6/2014
-7.6% 12%
-2%
1%
35%
-37%
1,152
MEUR
Second quarter development
MEUR
1,132
4
Net sales in line with expectations
Power Plants
Ship Power
Services
Q1-Q2 Q3-Q4
-1%

5. © Wärtsilä
Net sales by business 1-3/2012
Ship Power
38% (28)
Power Plants
20% (28)
Services
42% (44)
5
Net sales by business 1-6/2014

6. © Wärtsilä
0.88
1.07 1.05 1.05 1.07
0,0
0,2
0,4
0,6
0,8
1,0
1,2
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
5500
2010 2011 2012 2013 1-6/2014
Order intake Net sales Book-to-bill
MEUR
6
Book-to-bill ratio remains above one

7. © Wärtsilä
Order book distribution
MEUR
7
Order book distribution
0
500
1000
1500
2000
2500
3000
3500
30.6.2013 30.6.2014
Delivery current year Delivery next year or later

8. © Wärtsilä
9.6%
10.8%
0%
2%
4%
6%
8%
10%
12%
0
20
40
60
80
100
120
140
Q2/2013 Q2/2014
10.7%
11.1% 10.9%
11.2%
0%
2%
4%
6%
8%
10%
12%
14%
0
100
200
300
400
500
600
2010 2011 2012 2013
MEUR
Second quarter development
MEUR
8
Profitability developed well
EBIT% before non-recurring items
EBIT before non-recurring items

9. © Wärtsilä9
Continued uncertainty
in power generation
markets

10. Improvement in power plant quotations
10 © Wärtsilä
Activity remains focused on gas
0
2000
4000
6000
8000
10000
12000
14000
16000
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
MW
Quoted MW per Fuel Type
Others
Natural gas
Heavy fuel oil

11. © Wärtsilä
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2010 2011 2012 2013 1-6/2014
MEUR
Review period development
Total EUR 409 million (623)
IPP’s*
Utilities
Industrials
Oil
48%
Gas
52%
Review period order intake by fuel in MW
x%
11
Power Plants order intake by customer segment
17%
28%
55%
Q1-Q2 Q3-Q4
*IPP = Independent Power Producer

12. © Wärtsilä
308
50
217
30
118
130
Order intake 1-6/2014: 986 MW (1,113)
Americas 76 (324)
Asia 284 (210)
Africa and Middle East 265 (359)
Utilities
IPP’s
Industrials
12
Power Plants global order intake
3
18
37
Europe 361 (220)
76

13. © Wärtsilä
• The 47 MW power plant will be located in the
mountain desert close to Taif city
• Equipment will be fast-track delivered by
February 2015 and the power plant will enter
commercial operation by October 2015
• The power plant consists of five 20-cylinder
Wärtsilä 32TS engines designed to operate at
outstanding efficiency even in extreme ambient
conditions
• Wärtsilä has today over 1,600 MW of installed
power plant capacity in Saudi Arabia
13
Turnkey power plant order from Saudi Arabia
NEW
PIC

14. © Wärtsilä
Siemens
GE
MHI
Wärtsilä
Alstom
14
19.8%
2013
48.2%
22.1%
2.9%
Total market 73.2 GW (75.4)
3.3%
2.6%
Other GTs
Ansaldo
14
Market for gas and liquid based power plants
Includes all Wärtsilä power plants and other manufacturers’ gas and liquid fuelled power plants with prime
movers above 5 MW, as well as estimated output of steam turbines for combined cycles.
The data is gathered from the McCoy Power Report.
Other combustion engines not included. In engine technology Wärtsilä has a leading position.
1.1%

15. © Wärtsilä15
Marine markets
active, especially
within the gas
carrier segment

16. © Wärtsilä
0
1
2
3
4
5
0
50
100
150
200
250
01.09
02.09
03.09
04.09
05.09
06.09
07.09
08.09
09.09
10.09
11.09
12.09
01.10
02.10
03.10
04.10
05.10
06.10
07.10
08.10
09.10
10.10
11.10
12.10
01.11
02.11
03.11
04.11
05.11
06.11
07.11
08.11
09.11
10.11
11.11
12.11
01.12
02.12
03.12
04.12
05.12
06.12
07.12
08.12
09.12
10.12
11.12
12.12
01.13
02.13
03.13
04.13
05.13
06.13
07.13
08.13
09.13
10.13
11.13
12.13
01.14
02.14
03.14
04.14
05.14
06.14
MillionCGT
#ofvessels
Merchant Offshore Cruise and Ferry Special vessels 3 months moving average in CGT
16
Vessel contracting development
Source: Clarkson Research Services, figures exclude late contracting
* CGT= gross tonnage compensated with workload
*
*

17. Vessel contracting in specialised segments
Source: Clarkson Research Services, figures exclude late contracting
0
10
20
30
40
50
60
70
80
01.09
02.09
03.09
04.09
05.09
06.09
07.09
08.09
09.09
10.09
11.09
12.09
01.10
02.10
03.10
04.10
05.10
06.10
07.10
08.10
09.10
10.10
11.10
12.10
01.11
02.11
03.11
04.11
05.11
06.11
07.11
08.11
09.11
10.11
11.11
12.11
01.12
02.12
03.12
04.12
05.12
06.12
07.12
08.12
09.12
10.12
11.12
12.12
01.13
02.13
03.13
04.13
05.13
06.13
07.13
08.13
09.13
10.13
11.13
12.13
01.14
02.14
03.14
04.14
05.14
06.14
#ofvessels
LNG carriers - LPG carriers - Offshore - Special vessels - Cruise and Ferry
17 © Wärtsilä

18. © Wärtsilä
0
300
600
900
1200
1500
1800
2010 2011 2012 2013 1-6/2014
MEUR
Review period development
Total EUR 875 million (827)
Offshore
30%
Traditional
merchant
18%
Special
vessels
4%
18
Ship Power order intake developed favourably
Others
1%
Q1-Q2 Q3-Q4
Gas carriers
37%
Cruise
and ferry
3%
Navy
5%

19. © Wärtsilä
• Order to supply exhaust gas cleaning systems
to six Finnlines vessels operating in the Baltic
and North Sea
• Wärtsilä’s scrubber systems enable compliance
with the new environmental regulations when
operating on heavy fuel oil
• The systems are also compliant with the water
discharge criteria set by regulators
• Wärtsilä has to date a total of 105 systems
delivered or on order, for 55 vessels
19
Finnlines selects Wärtsilä’s systems to reduce Baltic Sea
environmental impact
NEW
PIC

20. © Wärtsilä
• Joint venture order intake totalled
EUR 92 million (113) during
January-June 2014
• Wärtsilä’s share of ownership in
these companies is 50%, and the
results are reported as a share of
result of associates and joint
ventures
MEUR
Ship Power order intake
Joint venture order intake, includes figures from Wärtsilä Hyundai Engine Company Ltd.
and Wärtsilä Qiyao Diesel Company Ltd.
20
Joint venture ordering continues active
0
50
100
150
200
250
300
350
400
450
500
550
600
Q1/2010
Q2/2010
Q3/2010
Q4/2010
Q1/2011
Q2/2011
Q3/2011
Q4/2011
Q1/2012
Q2/2012
Q3/2012
Q4/2012
Q1/2013
Q2/2013
Q3/2013
Q4/2013
Q1/2014
Q2/2014

21. © Wärtsilä
Wärtsilä’s market shares are calculated on a 12 months rolling basis, numbers in brackets are from the end of the
previous quarter. The calculation is based on Wärtsilä’s own data portal.
Wärtsilä
52%(51)
Others
20%(20)
MAN D&T
17%(23)
Caterpillar
11%(6)
MAN D&T
88%(90)
Wärtsilä
11%(9)
Mitsubishi
1%(1)
Low-speed main engines
Total market volume last 12 months:
28,804 MW (31,017)
Total market volume last 12 months:
4,139 MW (3,787)
Medium-speed main engines
Wärtsilä
2%(3)
Auxiliary engines
Total market volume last 12 months:
7,860 MW (6,895)
Others
98%(97)
21
Ship Power market
Market position of Wärtsilä’s marine engines

22. © Wärtsilä22
Services customers
interest in long-term
partnerships
increasing

23. © Wärtsilä
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2010 2011 2012 2013 1-6/2014
-3%
0
100
200
300
400
500
600
Q2/2013 Q2/2014
MEUR
Second quarter development
MEUR
465 1% 468
0%
23
Services net sales development remains stable
5%
Q1-Q2 Q3-Q4

24. © Wärtsilä
Spare parts
52%(50)
Field service
25%(27)
Contracts
17%(16)
Projects
6%(7)
24
Total EUR 903 million (899)
Services net sales distribution 1-6/2014

25. © Wärtsilä
• Technical management agreements covering a
total of 15 vessels signed with three Greek LNG
ship owners during Q2/2014
• The agreement will enable higher availability,
increased engine performance and optimised
maintenance intervals
• The service outlook for gas fuelled vessels
remains favourable going forward
25
Strong interest for services agreements in LNG industry

26. © Wärtsilä
O&M and maintenance agreements Power Plants deliveries % of delivered MWs
MW
26
Development of new Power Plants service agreements
53%
57% 58% 57%
51%
31%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
0
500
1000
1500
2000
2500
3000
3500
4000
4500
2009 2010 2011 2012 2013 Q2/2014
12m rolling

27. © Wärtsilä
Fleet utilisation
* Source Bloomberg. Sample of more than 25 000 vessels (>299 GT) covered by IHS AIS Live.
** Source Bloomberg
27
Fleet utilisation
Fleet Average Speed, knots**
Anchored Vessels & Fleet Development*
20000
20500
21000
21500
22000
22500
15%
20%
25%
30%
35%
12.11
03.12
06.12
09.12
12.12
03.13
06.13
09.13
12.13
03.14
06.14
NrofActiveVessels
PercentAnchored
Anchored Active Fleet
8,0
8,5
9,0
9,5
10,0
10,5
12.11
03.12
06.12
09.12
12.12
03.13
06.13
09.13
12.13
03.14
06.14

28. © Wärtsilä28
Solid financial
standing

29. © Wärtsilä29
MEUR
Favourable development in operating cash flow
0
20
40
60
80
100
120
140
160
180
200
1-6/2013 1-6/2014
Review period development
MEUR
0
100
200
300
400
500
600
700
2010 2011 2012 2013

30. © Wärtsilä
118
235
465
313
2.6%
5.6%
9.8%
6.7%
0%
5%
10%
15%
20%
25%
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2010 2011 2012 2013
Working capital Total inventories Advances received Working capital / Net sales
MEUR
30
Focus on working capital development
508
339
10.9%*
7.1%*
0%
2%
4%
6%
8%
10%
12%
0
200
400
600
800
1000
1200
1400
1600
30.6.2013 30.6.2014
MEUR
Review period development
* Working capital / 12 months rolling net sales

31. © Wärtsilä31
Gearing remains low
0,00
0,10
0,20
0,30
0,40
0,50
30.6.2013 30.6.2014
-0,10
0,00
0,10
0,20
0,30
0,40
0,50
2010 2011 2012 2013
Review period development

32. © Wärtsilä
• Power Plants: Power generation markets closely follow
the global macro-economic situation. Based on the
market challenges seen during the first half year and the
revised GDP forecasts for 2014, the overall market for
liquid and gas fuelled power generation is expected to
continue to be challenging.
• Ship Power: Offshore activity is anticipated to continue;
however a decline in the contracting of drilling units and
certain support vessels may be seen. The shipping
markets are expected to remain active, especially within
the gas carrier segment, although the contracting of
traditional merchant vessel orders is likely to decline.
• Services: The overall service market outlook remains
stable, with positive developments in selected regions.
32
Market outlook
NEW
PIC

33. © Wärtsilä
• Wärtsilä and China State Shipbuilding
Corporation (CSSC) have signed an agreement
to establish a joint venture, which will take over
Wärtsilä’s 2-stroke engine business
• CSSC will own 70% and Wärtsilä 30% of the
business
• Responsibility for servicing Wärtsilä’s 2-stroke
engines will remain with Wärtsilä Services
• The deal will have a positive effect on Wärtsilä’s
continuing operations
• The closing of the transaction is subject to the
required regulatory approvals, which are
expected in the first quarter of 2015.
• Going forward, the 2-stroke engine business will
be reported as discontinued operations
33
Wärtsilä and China State Shipbuilding Corporation to join
forces in 2-stroke engine joint venture
NEW
PIC

34. © Wärtsilä34
Wärtsilä estimates its profitability
for 2014 to be around 11.5%, due to
the two-stroke business
transaction. Net sales are expected
to grow by around 5%.
Prospects for 2014 revised

35. IR Contact:
Natalia Valtasaari
Director, Investor Relations
Tel. +358 (0) 40 187 7809
E-mail: natalia.valtasaari@wartsila.com