Report for Q4 2011 - Alfa Laval EBITA margin 17.0% Adjusted EBITA margin 17.0% vvss 18.6%...

Report for Q4 2011Report for Q4 2011

Mr. Lars RenströmMr. Lars RenströmPresident and CEOPresident and CEOAlfa Laval GroupAlfa Laval Group

-- Orders received and marginsOrders received and margins

-- HighlightsHighlights

-- Development per segmentDevelopment per segment

-- Geographical developmentGeographical development

-- Financials Financials

-- OutlookOutlook

Key figuresKey figures

�� Orders received rose 6% to SEK 6,774 million.Orders received rose 6% to SEK 6,774 million.

�� Net sales increased 14% to SEK 8,149 million.Net sales increased 14% to SEK 8,149 million.

�� Adjusted EBITA up 4% at SEK 1,387 million. Adjusted EBITA up 4% at SEK 1,387 million.

�� Adjusted EBITA margin 17.0% Adjusted EBITA margin 17.0% vsvs 18.6%18.6%

-- Negative currency effect SEK 80 million.Negative currency effect SEK 80 million.

October October –– December 2011December 2011

www.alfalaval.com© Alfa Laval Slide 3


�� Orders received rose 20% to SEK 28,671 million.Orders received rose 20% to SEK 28,671 million.

�� Net sales increased 16% to SEK 28,652 million.Net sales increased 16% to SEK 28,652 million.

�� Adjusted EBITA up 13% at SEK 5,287 million. Adjusted EBITA up 13% at SEK 5,287 million.

�� Adjusted EBITA margin 18.5 % Adjusted EBITA margin 18.5 % vsvs 18.9%18.9%


January January –– December 2011December 2011

Board proposal to the AGMBoard proposal to the AGM

The Board of directors proposesThe Board of directors proposes

•• A dividend of 3.25 SEK (3.00)A dividend of 3.25 SEK (3.00)

•• A mandate to buy back up to 5 percent of the A mandate to buy back up to 5 percent of the

Dividend and share buybackDividend and share buyback


•• A mandate to buy back up to 5 percent of the A mandate to buy back up to 5 percent of the number of outstanding sharesnumber of outstanding shares

16 000

20 000

24 000

28 000

32 000

4 000

5 000

6 000

7 000

8 000

SEK millionSEK million

Orders receivedOrders received

SEK million R 12SEK million R 12


0

4 000

8 000

12 000

16 000

0

1 000

2 000

3 000

4 000

= rolling twelve months value= rolling twelve months value

= order intake per quarter= order intake per quarter

Q109

Q109

Q410

Q410

Q111

Q111

Q311

Q311

Q411

Q411

Q407

Q407

Q108

Q108

Q208

Q208

+9%

+9%

0%

0%

+9%

+9%

+8%

+8%

= % development at constant rates by = % development at constant rates by quarter, year on yearquarter, year on year

+xx%+xx%

--3%

3%

Q308

Q308

Q408

Q408

--15%

15%

--32%

32%

Q209

Q209

--37%

37%

Q309

Q309

--30%

30%

Q409

Q409

--9%

9%

--6%

6%

Q110

Q110

Q210

Q210

+25%

+25%

Q310

Q310

+23%

+23%

+23%

+23%

+ 3

2%

+ 3

2%

Q211

Q211

+38%

+38%

+ 3

7%

+ 3

7%

Order analysisOrder analysis

Q4 2010 Q4 2010 (SEK (SEK mlnmln)) Q3 2011Q3 2011

Structural change, %Structural change, %

Currency effects,%Currency effects,%

Organic development, %Organic development, %

6,3796,379

Q4 2011 versus Q4 2010 and versus Q3 2011Q4 2011 versus Q4 2010 and versus Q3 2011

+ + 10.8 10.8

-- 2.52.5

-- 2.12.1

8,0188,018

--

+ 0.6+ 0.6

-- 16.116.1


Organic development, %Organic development, %

Total, %Total, %

Q4 2011 Q4 2011 (SEK (SEK mlnmln)) Q4 2011Q4 20116,7746,774

-- 2.12.1

+ 6.2+ 6.2

6,7746,774

-- 16.116.1

--15.515.5

15,0

18,0

21,0

24,0

1 125

1 350

1 575

1 800

SEK millions and in percent of salesSEK millions and in percent of sales

Adjusted EBITA / margin *Adjusted EBITA / margin *


0,0

3,0

6,0

9,0

12,0

0

225

450

675

900

* Adjusted EBITA * Adjusted EBITA –– ”Earnings before interests, taxes, amortization of goodwill and step up values and comparison distortion item”Earnings before interests, taxes, amortization of goodwill and step up values and comparison distortion items.”s.”

Q211Q211Q109Q109 Q409Q409 Q110Q110 Q210Q210 Q310Q310 Q410Q410 Q111Q111 Q311Q311 Q411Q411Q408Q408 Q209Q209 Q309Q309








-- OutlookOutlook

Highlights during the quarterHighlights during the quarter

�� Order from edible oil company in Indonesia. Order from edible oil company in Indonesia. The order includes engineering as well as equipment to a company The order includes engineering as well as equipment to a company

producing edible oil. The value is approximately SEK 85 million and producing edible oil. The value is approximately SEK 85 million and

delivery is scheduled for 2012.delivery is scheduled for 2012.

Total large ordersTotal large orders SEK 220 SEK 220 MlnMln (310 (310 MlnMln))



�� Order from edible oil company in IndonesiaOrder from edible oil company in Indonesia�� DieselDiesel--power order in the Dominican Republic.power order in the Dominican Republic.

The order, which is worth approximately SEK 65 million, includes airThe order, which is worth approximately SEK 65 million, includes air--

cooled heat exchangers, boilers and separators for a combinedcooled heat exchangers, boilers and separators for a combined--cycle cycle

power plant. Delivery is scheduled for 2012.power plant. Delivery is scheduled for 2012.




�� Order from edible oil company in IndonesiaOrder from edible oil company in Indonesia�� DieselDiesel--power order in the Dominican Republic.power order in the Dominican Republic.�� EnergyEnergy--efficiency order from Russian refinery.efficiency order from Russian refinery.

Alfa Laval will supply compact heat exchangers that will reuse heat in the Alfa Laval will supply compact heat exchangers that will reuse heat in the

refinery process for preheating crude oil, resulting in a energyrefinery process for preheating crude oil, resulting in a energy--efficient efficient



refinery process for preheating crude oil, resulting in a energyrefinery process for preheating crude oil, resulting in a energy--efficient efficient solution. The value is approximately SEK 70 million and delivery is solution. The value is approximately SEK 70 million and delivery is scheduled for 2012.scheduled for 2012.

Large orders in 2011Large orders in 2011

SEK SEK mlnmln CountryCountry ApplicationApplication Industry Industry DeliveryDelivery

Large orders, total SEK > 1 400 million (1 000) Large orders, total SEK > 1 400 million (1 000)

IndiaIndia

Saudi ArabiaSaudi Arabia

GermanyGermany

USUS

RussiaRussia

IndiaIndia

BrazilBrazil

5050

7575

6060

substantialsubstantial

7070

6565

135135

FoodFood

RefineryRefinery

PowerPower

PowerPower

RefineryRefinery

FoodFood

BreweryBrewery

20112011

20122012

20122012

20122012

20122012

20122012

20112011

SeveralSeveral

Heat transferHeat transfer

Oil treatmentOil treatment


Energy efficiencyEnergy efficiency

SeveralSeveral

SeveralSeveral


BrazilBrazil

Singapore Singapore

UAEUAE

ChinaChina

Middle EastMiddle East

IndiaIndia

KazakhstanKazakhstan

CanadaCanada

IndonesiaIndonesia

FinlandFinland

RussiaRussia

135135

110110

6060

5050

9090

100100

5555

6060

8585

6565

7070

BreweryBrewery

PetrochemPetrochem

Nuclear powerNuclear power

PetrochemPetrochem

Natural gasNatural gas

FoodFood

RefineryRefinery

EnvironmentalEnvironmental

FoodFood

Diesel powerDiesel power

RefineryRefinery

20112011

20122012

20132013--1818

20122012

20122012

20132013

20122012

20122012

20122012

20122012

2012 2012

SeveralSeveral





SeveralSeveral


Water treatmentWater treatment

SeveralSeveral

SeveralSeveral


Top 10 marketsTop 10 marketsOrder intake 2011 YTDOrder intake 2011 YTD

Mid Europe

Korea, South

Nordic

China

United States

(8)(8)


0 1000 2000 3000 4000

Japan

India

Brazil

Russia

Adriatic

SEK at prevailing ratesSEK at prevailing rates

(10)(10)

(5)(5)








-- OutlookOutlook

Orders received by customer segmentOrders received by customer segment

Industrial Industrial EquipmentEquipment

Marine & DieselMarine & Diesel

Process IndustryProcess Industry

Energy Energy

& & EnvironmentEnvironment

October October –– December 2011, December 2011, at at constant constant rates and like for likerates and like for like

−−−− ++++

++++−−−−

−−−−


SanitarySanitary

OEMOEMFoodFood

Parts & ServiceParts & Service−−−−

−−−−

====

−−−−

Orders received by customer segmentOrders received by customer segmentProcess Technology Division Process Technology Division Q4, sequential development Q4, sequential development at at constant ratesconstant rates

��Stable development for Stable development for base business and Parts & base business and Parts & Service.Service.

��Energy down due to nonEnergy down due to non--repeat large orders. repeat large orders. Environment lifted by Environment lifted by strong development for strong development for base business.base business.

��Food down. Still, continued Food down. Still, continued


Energy Energy


FoodFood

−−−−

−−−−

−−−−

www.alfalaval.com

Slide 16

© Alfa Laval

��Food down. Still, continued Food down. Still, continued growth for vegetable oil in growth for vegetable oil in Asia.Asia.

FoodFood

Parts & ServiceParts & Service

−−−−

====

Orders received by customer segmentOrders received by customer segmentEquipment Division, Equipment Division, Q4, sequential development Q4, sequential development at at constant ratesconstant rates

�� Sanitary rose on demand Sanitary rose on demand in Western Europe and in Western Europe and North America.North America.

�� Marine & Diesel down Marine & Diesel down following lower contracting following lower contracting levels at the yards.levels at the yards.

�� Industrial Equipment Industrial Equipment somewhat lower due to somewhat lower due to seasonality for certain seasonality for certain


−−−−

−−−−

Industrial EquipmentIndustrial Equipment


seasonality for certain seasonality for certain applications.applications.

Parts & ServiceParts & Service====

SanitarySanitary

OEMOEM

++++

−−−−−−−−

Orders received by customer segmentOrders received by customer segment

Industrial Industrial EquipmentEquipment



Energy Energy


January January –– December 2011, December 2011, at constant at constant rates and like for likerates and like for like

++++ ++++

++++++++

++++


SanitarySanitary

OEMOEMFoodFood

Parts & ServiceParts & Service++++

====

++++

++++

Report Q4 2011Report Q4 2011







-- OutlookOutlook

Orders received by RegionOrders received by Region

Asia Asia 31 31 %%

October October –– December 2011, December 2011, at constant ratesat constant rates

+26+26+9+9

+24+24

+3+3


+28+28


Asia Asia 31 31 %%

October October –– December 2011, sequential development December 2011, sequential development at at constant ratesconstant rates

+28+28--99

==

--3434


Asia Asia 31 31 %%

--99

North America North America

� Order intake down, affected by

non-repeat large orders.

Highlights AmericasHighlights AmericasOctober October –– December 2011, sequentially, December 2011, sequentially, at at constant ratesconstant rates

--99


� Base business was unchanged.

Latin Latin America America

�� Order intake somewhat lower due to Order intake somewhat lower due to

nonnon--repeats in Process Technology repeats in Process Technology

division.division.

�� Energy & Environment still showed Energy & Environment still showed

good growth, as did the Equipment good growth, as did the Equipment

Division.Division.

--99

Highlights EuropeHighlights Europe

Western Europe incl. NordicWestern Europe incl. Nordic

�� Dip in large orders had Dip in large orders had

a negative impact in the region.a negative impact in the region.

�� Continued growth for the Continued growth for the

October October –– December 2011, sequentially December 2011, sequentially at at constant ratesconstant rates

+28+28

==


�� Continued growth for the Continued growth for the

base business.base business.

Central Central and Eastern Europe and Eastern Europe

�� Strong development, boosted by the Strong development, boosted by the

Process Technology division. Process Technology division.

�� Turkey and Russia both reported solid Turkey and Russia both reported solid

growth.growth.

Highlights AsiaHighlights Asia

Asia Asia

�� Orders dropped due to a decline Orders dropped due to a decline

in Marine & Diesel and also nonin Marine & Diesel and also non--

repeat large orders in Process repeat large orders in Process

October October –– December 2011, sequentially, December 2011, sequentially, at at constant ratesconstant rates

--3434


repeat large orders in Process repeat large orders in Process

Technology.Technology.

�� WaitWait--andand--see mode for projects see mode for projects

in India and China.in India and China.


Asia Asia 35 35 %%

JanuaryJanuary–– December 2011, December 2011, at constant ratesat constant rates

+36+36+19+19

+24+24

+39+39


Asia Asia 35 35 %%

+39+39


Mr. Thomas ThuressonMr. Thomas ThuressonCFOCFOAlfa Laval GroupAlfa Laval Group






-- OutlookOutlook

HighlightsHighlights

Order intake Order intake

Net salesNet sales

6,7746,774

8,1498,149

SEK millionsSEK millions OctoberOctober –– December 2011December 2011


Gross profit marginGross profit margin

40

50In percent of salesIn percent of sales

37.837.839.339.338.738.740.240.2

www.alfalaval.com© Alfa Laval

20

30

Q109Q109 Q309Q309 Q409Q409 Q110Q110 Q210Q210 Q310Q310 Q410Q410 Q111Q111 Q211Q211 Q311Q311 Q411Q411Q408Q408 Q209Q209


Order intake Order intake Net salesNet salesAdjusted EBITAAdjusted EBITA

Adjusted EBITAAdjusted EBITA--marginmargin

Structural cost for savings measuresStructural cost for savings measuresProfit before taxProfit before tax

SEK millionsSEK millions OctoberOctober –– December 2011December 2011

6,7746,774

8,149 8,149

1,3871,387

17.0%17.0%

--9090

1,3811,381


Profit before taxProfit before tax 1,3811,381

Earnings per shareEarnings per share

EarningsEarnings

Earnings, excluding Earnings, excluding stepstep--upup

20112011

7.687.68

8.428.42

20102010

7.347.34

8.028.02

Jan Jan –– Dec Dec 20112011

2.212.21

2.432.43

20102010

2.142.14

2.322.32

Oct Oct –– DecDec



Order intake Order intake

Net salesNet sales

Adjusted EBITAAdjusted EBITA

Adjusted EBITAAdjusted EBITA--marginmargin

Profit before taxProfit before tax

SEK millionsSEK millions Oct Oct –– Dec 2011Dec 2011

6,7746,774

8,1498,149

1,3871,387

17.0% 17.0%

1,381 1,381


Profit before taxProfit before tax

Cash flow from operating activitiesCash flow from operating activities

ROCEROCE

ROEROE

1,381 1,381

1,2911,291

31.3%31.3%

22.9%22.9%

Cash flow fromCash flow from

-- operating activitiesoperating activities

-- investing activitiesinvesting activities

Financial Financial net paidnet paid

DividendsDividends

CashCash--flow statement flow statement

SEK millionsSEK millions

Jan Jan –– Dec Dec

20112011

Jan Jan –– DecDec

20102010

+3,429+3,429

-- 5,4975,497

+ 105+ 105

--1,2581,258

+4,098+4,098

-- 1,4171,417

-- 8484

--1,0551,055


DividendsDividends

TotalTotal

Pro Forma Pro Forma Free cashFree cash--flowflow****Incl. operating activities, capital expenditure and financial net paid.Incl. operating activities, capital expenditure and financial net paid.

--1,2581,258

2,9792,979

--1,0551,055

3,5853,585

--3,2213,221 --1,5421,542

4Q Pro 4Q Pro Forma Forma Free cashFree cash--flow*flow* 983983 805805

Process to delist Alfa Laval India Ltd.Process to delist Alfa Laval India Ltd.

•• Sept. 19Sept. 19thth, Alfa Laval announced the aim to achieve full ownership of its subsidiary , Alfa Laval announced the aim to achieve full ownership of its subsidiary

Alfa Laval India Ltd and seek delisting.Alfa Laval India Ltd and seek delisting.

•• The delisting proposal passed hurdle of receiving backing from two thirds of Alfa The delisting proposal passed hurdle of receiving backing from two thirds of Alfa

Laval India Ltd minority shareholders.Laval India Ltd minority shareholders.

•• Beginning of January an indicative price of INR 2 850/share was announced, but Beginning of January an indicative price of INR 2 850/share was announced, but

the actual cost is dependent on the fixing of the final price. However, at INR 2 850 per the actual cost is dependent on the fixing of the final price. However, at INR 2 850 per

www.alfalaval.com

the actual cost is dependent on the fixing of the final price. However, at INR 2 850 per the actual cost is dependent on the fixing of the final price. However, at INR 2 850 per

share, 100 percent of the outstanding shares represents about SEK760 million.share, 100 percent of the outstanding shares represents about SEK760 million.

•• The bookThe book--building process is estimated to open February 15building process is estimated to open February 15thth and results are and results are

expected to be available by the end of the month.expected to be available by the end of the month.

••Once Alfa Laval reaches an ownership of at least 94.4 percent, the company can go Once Alfa Laval reaches an ownership of at least 94.4 percent, the company can go

ahead and apply for delisting. ahead and apply for delisting. ��

((AmountsAmounts in SEK m)in SEK m) Process Process

Technology*Technology*

EquipmentEquipment Marine & Marine &

Diesel*Diesel*

Alfa Laval Alfa Laval

GroupGroup

Orders ReceivedOrders Received 12,73812,738 9,5089,508 6,4236,423 28,67128,671

Order BacklogOrder Backlog 6,8896,889 1,3851,385 5,4625,462 13,73613,736

Net InvoicingNet Invoicing 12,16012,160 9,4479,447 7,0437,043 28,65228,652

Alfa Laval GroupAlfa Laval GroupPerformance by Division Performance by Division -- JanuaryJanuary -- December December 2011 2011

www.alfalaval.com

Net InvoicingNet Invoicing 12,16012,160 9,4479,447 7,0437,043 28,65228,652

Operating Operating IncomeIncome / /

EBITEBIT

2,5162,516 1,2781,278 1,7081,708 4,6914,691

-- In % of salesIn % of sales 20.720.7 13.513.5 24.324.3 16.416.4

© Alfa Laval Slide 34

*) *) InclIncl. Aalborg from May 1st. Aalborg from May 1st

Foreign exchangeForeign exchange

SEK millionSEK million

Translation effectTranslation effect

Transaction effectTransaction effect

TotalTotal

Estimated impact on adjusted EBITA from FX fluctuationsEstimated impact on adjusted EBITA from FX fluctuations

WY WY 12*12*

105105

--110110

--55

FY 11FY 11

--278278

--190190

--468468

Q4 11Q4 11

--1111

--6969

--8080


TotalTotal

*Based on EUR/USD 1.28 and EUR/SEK 9.00*Based on EUR/USD 1.28 and EUR/SEK 9.00

--55--468468--8080

Projected FXProjected FX--effect for 2011 as communicated with the Q3 report effect for 2011 as communicated with the Q3 report SEK SEK --410 million 410 million

Order backlog as per Dec. 31

SEK millionsSEK millions

10000

12000

14000

16000

11,90611,906

2,2692,269

2,4462,446

1,9791,979

11,55211,552

13,73613,736


For delivery For delivery in 2012in 2012

0

2000

4000

6000

8000

For delivery For delivery later than 2012later than 2012

9,5739,5739,6379,637 11,29011,290

20092009 20102010 20112011

SalesSalesFull year Full year 20122012

SEK (SEK (blnbln))

Full year 2011Full year 2011 28.728.7

Order backlog, likeOrder backlog, like--forfor--likelike -- 0.30.3

FXFX--translation translation + 0.5+ 0.5

SubtotalSubtotal 28.928.9

www.alfalaval.com

Aalborg, 4 monthsAalborg, 4 months ++ 0.8*0.8*

Orders “inOrders “in--forfor--out” ?out” ?

Price ?Price ?

Full year 2012Full year 2012

* An indication based on FY orders 2011. Less 8 months of sales 2011.



-- Orders received and operating margin Orders received and operating margin





-- OutlookOutlook

Outlook for the first quarterOutlook for the first quarter

“We expect that demand during “We expect that demand during

the first quarter 2012 will be in the first quarter 2012 will be in

line with, or somewhat higher line with, or somewhat higher


line with, or somewhat higher line with, or somewhat higher

than, the fourth quarter 2011.” than, the fourth quarter 2011.”

Report for Q4 2011 - Alfa Laval EBITA margin 17.0% Adjusted EBITA margin 17.0% vvss 18.6%...

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