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Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 1
Capital Market Day 2005
Sulzer Chemtech
Mauricio Bannwart, President Sulzer Chemtech North and South America
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 2
Our Business: Components and Services for Separation Columns and Static Mixing
Products and ServicesTower internals for distillation, absorption, and reactive distillation processes; crystallization and pervaporation applicationsMixing and reaction technology with static mixersAssociated services: engineering, piloting, tower field service
Customer BenefitsHigh reliability and process efficiency as single-source provider for engineering, design, equip-ment, and services Profound process know-how on a wide range of applications lead to low total costMultiple manufacturing and engineering sites ensure closeness to markets on a global basis
Key Figures 2004 (in million CHF)
Orders received 346
Net sales 313
Operating income bef. goodwill (EBITA) 30
Personnel employed (number as per 12/31) 1 407
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 3
Orders ReceivedSplit by Segment and Market Area
Orders received 2004 by segment
Total CHF 346 million
Orders received 2004 by market area
Total CHF 346 million
SwitzerlandEU countriesOther European countriesNorth AmericaLatin AmericaAsia, AustraliaAfrica
19%
81% Separation Columns
Static Mixing
17%
39%
4%3%
34%
2%1%
31%
5%
40%
100%
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 4
Truly Global Operations and Service Network
(121)(159)
(92)(156)
(150)
(244)
(116)
Netherlands
India
Singapore
China
USAMexico
Switzerland(290)
Sulzer Chemtechmanufacturing companies
( )
Sulzer Chemtechsales offices
Staff, worldwide 1’407(Dec '04)
Poland
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 5
Markets and Customers: Separation Columns
Segments Oil and gas, petrochemical industry
Market size CHF 800–1.000 million
Growth General GDP, some segments 4–6%
CustomersRefineries, petrochemical, chemical, and gas plants, engineering contractors, e.g., Shell, BP, ExxonMobil, BASF, Fluor, TOYO
Key success factors Product technology, applications know-how, innovation, global market presence
Market position Technology leader, strong No. 2 market position
End product Gasoline, chemicals, monomers
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 6
Separation Columns—Components
Trays
Rings
Structured Packings
Distributor
Gas
Liqu
id
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 7
Separation Columns—Components and Services
Application know-how and technology: Enhance performance—save operating costs
Separation through processes like distillation and absorption
Tower diameters 0.3–13 m
Tower heights 2–80 m
Trays, structured packings, rings, distributors, supports, etc.
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 8
Separation Columns—Services
Full scope supplier of column components, column modifications, and installation services
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 9
The Way Forward—Shaping the Future
With the acquisition of Cana-Tex, Sulzer Chemtech builds the globally leading Mass Transfer Field Service Organization!
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 10
Oil Refinery
FCC
Isomerisation
Crude Atmospheric
Naphtha Splitter
Absorber
Lean Solvent
StabilizerSplitter
HDS
Coker
SWSDe C4
Hydrocracker
Catalytic Reformer
Visbreaking
De-C2
De-C3
De-I C4
H2S Abs.
Vacuum Fuel
Lube
Isostripper
DepropanizerAkylationStabilizer
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 11
Crude Atmospheric Column
S
Crude Atmospheric Unit
KERO
DIESEL
AGO
Gas
LPG LN
HN
HN
Residue
Desalter
Preflash
Crude Atmospheric
Tower
Overhead system
Side Strippers
STab
Naphtha Splitter
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 12
Less metal and coal combustion residuesLighter color
- Pump around
Capacity increase
10% less stripping steam Energy saving
Enhanced fractionation
Increase capacity
Increase yield recovery
Improve AGO quality
up to 60%
up to 80%
Trays MellapakPlus
10–30%
1–1.5% more yieldLess lighter in AR
up to 20%
Capacity increase
30% less stripping steam
- MellapakPlus
Advantages
HN
KERO
AGO
Diesel
- Trays
- Stripping section - Fractionation sections
Hydraulic debottlenecking
10–30%10–15%10–30% 20–60%
20–40% 20–50%
Objectives
Crude Atmospheric Column
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 13
Customer ROI
Total investment: US$ 1,500,000
Savings: US$ 16,000 per day (based on higher yield of Diesel recovered from LR)
Pay-back time: US$ 1,500,000 / US$ 16,000 per day
=94 Days
We make our customers more competitive!
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 14
Markets and Customers: Static Mixing
Segments Oil and gas, petrochemical industry, plastic production, automotive
Market size CHF 400–500 million
Growth General GDP, some segments 10–15 %
CustomersRefineries, petrochemical, and chemical plants, polymer production, construction industry, e.g., Shell, BP, Foster Wheeler, 3M, Hilti
Key success factors Product technology, applications know-how, innovation
Market position Technology leader, strong No. 1 (respectively No. 3) market position for Quadro
End product Polystyrene, engineered plastics, adhesives
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 15
Static Mixing—Products and Applications
Motionless mixers placed in pipes
Geometry of devices provides mixing effects
Wide range of applicationsfor gases and liquids
For cooling, heating, reactingin the polymer production process
Diameter from a few mm to 2 m
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 16
Static Mixing—Innovative Technology for the Foaming of Injection Molded Components
Customer benefits from:
Weight reduction and raw material savings
Better mechanical properties
Increased productivity through reduced cycle time
Existing production machines can be upgraded easily
Environmentally friendly
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 17
Static Mixing—Disposable Mixers and Cartridges (Quadro Systems)
Novel type of two component mixer
Designed for single use, after which it is disposed
Combination of disposable mixers and cartridges
Efficient mixing of reactive resins and adhesives
Minimum length and pressure drop required
Customized design
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 18
Static Mixing—Innovative Solutions Applied by 3M (Quadro Systems)
Customer benefits from:
Lower pressure drop
Steadier targeting of adhesive flow
Less material wastage
High mixing quality
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 19
Static Mixing—Innovative Peeler Cartridge (Quadro Systems)
Adhesive A Inner Tube Conventional sealing pistons
Adhesive B Cartridge Body Peeler Plunger of Dispensing Gun
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 20
Competitive Picture
Main
Competitors
Segment
Sulzer Koch-Glitsch Small Players Chemineer Mixpacand TAH
Structured Packings
Trays and Replacements
Rings
Separators
Field Service
Static Mixing
Quadro Systems
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 21
The Last 12 Months in Review
ExternalGrowth
Field services: acquisition of Cana-TexSmall to mid-size acquisitionsto grow mixing activitiesStrengthening of core activities through adjacencies, e.g., gas market
Organic Growth
Technology innovation, new applicationsCooperation with key customersGlobal availability
OperationalExcellence
Improved productivity, faster delivery, reduced quality costsFurther efforts to improve cost structure, particularly in EuropeExpand cost-effective locations, e.g., India, China, Mexico
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 22
Financial Performance January–June 2005
in million CHF2005 2004
200.2 167.8
149.2
147.0
17.8
13.4
9.0%
1 407
192.0
19.3 %
28.7 %
6.0 %
35.4 %
46.3 %
155.8
24.1
19.6
10.2%
1 341
Orders received
Net sales
Order backlog
EBITDA
EBITA
ROS (EBITA/sales)
Personnel employed(in numbers as of June 30/December 31)
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 23
Midrange Targets
in million CHF 2003 2004
312 346
313
147
40
30
9.6%
22.9%
1 407
307
119
34
23
7.5%
15.2 %
1 381
Midterm targets
Orders received
Net sales
Order backlog
EBITDA
EBITA
ROS (EBITA/sales)7–8% ROS
over the cycle
ROCE (EBITA/capital employed) >16% ROCE
Personnel employed(in numbers as of December 31)
Organic growth 4–6%
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 24
Review 2005—Outlook 2005/2006
Excellent half-year closing 2005
High order backlog at the end of July (CHF 168 million)
Continued strong tender activities in all areas
Further potential for large projects
Encouraging improvements in Europe, Middle East, and Africa as well as in North and South America
Smooth integration of Cana-Tex so far
On trackfor a
record in2005
Maintain market momentum; take advantage of good conditions
Expand in the gas market
Launch of Business Development and Technology (organizational transformation)
Leverage Tower Field Service activities together with Mass Transfer Components
Intensive project work “Sulzer Chemtech – The Way Forward”
Launch global ERP/PDM1) project
Optimisticoutlook
for 2006/2007
1) Enterprise Resource Planning/Product Data Management
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 25
Summary
Continue creating value
Grow above market rate at sustained profitability
Grow organically and through selective acquisitions
Continue to focus on separation columns and mixing and look for 1–2 steps adjacencies
Maintain a leading technology and service position
Maintain operational performance
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 26
Sulzer Chemtech
Capital Market Day 2005 | Mauricio Bannwart, Sulzer Chemtech | page 27
Safe Harbor StatementTHE SAFE HARBOR STATEMENT UNDER THE US PRIVATE
SECURITIES LITIGATION REFORM ACT 1995
This presentation contains forward-looking statements, including, but not limited to projections of future performance of materials and products, containing risks and uncertainties. These statements are subject to change based on known risks detailed from time to time in the company’s relevant filings and other known and unknown risks and various other factors which could cause the actual results or performance to differ materially from the statements made herein.