cement division - per mejnert kristensen - flsmidth
TRANSCRIPT
Capital Market Day 2014
Cement DivisionPer Mejnert Kristensen, Group EVP
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Per Mejnert Kristensen, Group EVP Cement Group EVP, Cement Division, since March 2012 FLSmidth since 1992:
Vice President, Head of Project Division EMEA/APAC, FLSmidth
Vice President, Head of Project Division 1, FLSmidth
General Manager, FLSmidth China Chief Representative, Thailand, FLSmidth
MSc (Mechanical Engineering), Bachelor of Commerce degree, International Trade, Graduate Diploma (Bus. Admin.), International Trade, GMP, CEDEP (INSEAD)
Born 1967, Danish
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The Cement Division in brief
Development, design and installation of premium main equipment and full flow-sheet engineering solutions for cement plants
Regional centres in Denmark, USA and India
FLSmidth has delivered more cement plants in the world than anyone else
Employees: ~1,300
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0
1
2
3
4
5
-5
0
5
10
15
20%
Revenue (BDKK)
2012
3.4
2013
4.4
2014Q1-Q3
2.4
Future
EBITA%
Revenue EBITA%
Fundamentals of the Cement Division
Our excellence: Best in class in risk and project management combined with full scope supply of sustainable cement technologies
Strategic focus: While harvesting on our superior competencies in delivering EP contracts (engineering & procurement), we will increase focus on:
EPC contracts (engineering, procurement and construction) – in partnership with reliable and competitive ‘C’ providers (construction)
Engineered single equipment and upgrade projects
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Cement consumption will continue to grow in the future
0
1,000
2,000
3,000
4,000
5,000
6,000
1920 1940 1960 1980 2000 2020
Worst
Best
Most likely
Glo
bal c
emen
t co
nsum
ptio
n (M
TPA)
Source: Global Cement Top 100 Report, 2014
Drivers: Economic growth GDP per capita Population growth Investments in
infrastructure Urbanisation Industrialisation
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Order intake growth expected in 2015
AngolaBrazil
Colombia
Egypt
IndiaIndonesia
Iran
Kenya
Mexico
Nigeria
RussiaVietnam
0
100
200
300
400
500
600
700
800
900
1.000
0 10 20 30 40 50 60
Con
sum
ptio
n pe
r ca
pita
(kg
)
GDP per capita (2013 kUSD)
China(1,600 kg/cap)
Saudi Arabia, Oman, UAE
(1,475 - 1,955 kg/cap)
Continued cement growth inemerging markets
Emerging marketsUrbanisation and industrialisation
Mature marketsEconomy matures
Source: Global Cement Report, 10th edition, International Cement Review; FLSmidth analysis
Despite over capacity in some markets, there is under capacity in others, creating a large need for more cement capacity in the coming years.
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0 10k 20k 30k 40k 50k 60kGDP per capita 2013 (USD)
Our Vision and ambition
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Our vision:Be our customers’ preferred full-service provider of sustainable cement technologies
Our ambition: Financials:
3-5% annual revenue growth over the cycle 3-8% EBITA over the cycle Maintain positive cash flow and negative NWC
throughout project execution
Products
Projects, products and services are interconnected
Projects
Services
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Regional opportunities
North America• Environmental
requirements(NESHAP)
• EP & EPC projects & upgrades
Central & South America• Product sales, • EP and EPC
projects
IndiaProduct and project sales
Africa & Middle EastEPC projects combined with O&M
Russia & CISEP projects combined with (light) O&M
EuropeUpgrades and productivity improvements
Southeast Asia• EP & EPC projects• Product sales
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ChinaProducts and technologies for environmental protection and energy efficiency
Best in class project management and risk control capabilities
Offering a complete and flexible solution: EP projects, EPC projects, products and upgrades
Ability to offer combined EPC & O&M (Design, Build, Operate)
Global reach with local presence
Most reliable cement plants & upgrades
Process knowledge and emissions control
Strong focus on R&D ensuring efficient products at competitive prices
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Our unique competencies
The largest cement R&D centerProduct and technology innovation & testing
We work on… Applied research to acquire new
knowledge, later translated into sellable solutions
Continuous development of new equipment and processes
Improvement of our existing solutions
… with special focus on… Productivity improvement Decreasing energy consumption Reducing emissions Increasing usage of alternative fuels
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We facilitate financing
FLSmidth cooperates with international financial institutions and banks, including the Danish Export Credit Agency (EKF), capable of financing cement projects worldwide.
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Design, Build and OperateMinimising risks and increasing return for customers
Tailor-made design of the complete plant
EPC solution in partnership with an experienced construction company
O&M guarantees high performance from take-over
Ramlaya, Egypt
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All you need is…
“…and Customers to purchase your guaranteed cement production”
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Raw materials
Permissions
The Cement Division: Key takeaways
Offering all from complete projects to individual products and upgrades
Increased focus on EPC while mitigating the risks, and harvesting on our superior EP competencies
Increased focus on product and upgrade sales
Sales lead for the Product Companies
‘Partner’ with the Customer Services Division to offer a combined Design, Build and Operate value proposition as well as ensure future spares and service sales
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