Agenda – Rotating Equipment Services
Capital Market Day 2015 Rotating Equipment Services Peter Alexander, Division President | February 12, 2015 Agenda – Rotating Equipment Services Sulzer Full Potential for RES Point of Departure Mission & Strategy Operational Excellence Summary Rotating Equipment Services | Capital Market Day 2015 | slide 2 The best of two worlds: OEM and independent services… Equipment serviced Turbo Pumps Electrical Turbines and Compressors OEM and 3rd party Generators and Motors BU AME US, Canada Mexico Brazil, Argentina Colombia, Venezuela We are well positioned to become the worldwide preferred and integrated rotating equipment service provider with the best and broadest technical capabilities available BU EMEA UK, Germany Netherlands, Norway France, Spain Middle East, Russia BU APAC Australia Indonesia, India China, Singapore Rotating Equipment Services | Capital Market Day 2015 | slide 3 ….with a unique service proposition for our customers Single point of service reduces customer costs and complexity Solving our customers problems 100 locations in 25 countries True service mindset Best quality and technology Global reach and local presence Broadest range of capabilities OEM and non-OEM expertise Gas and steam turbines, centrifugal compressors, pumps, motors, generators Rotating Equipment Services | Capital Market Day 2015 | slide 4 Rotating Equipment Services Division Snapshot Sales by geography (2014) APAC 12% Sales by market segment1) EMEA 39% 25% 35% 2% 1% 28% AME 49% 32% Sales and profitability development 45% 2013 2014 Oil and gas Water 10.1% 10.0% 9.3% 8.9% Power General industry 2013 Sales (CHFm) 1) 725 706 32% ROSR 2014 opROSA Rotating Equipment Services | Capital Market Day 2015 | slide 5 2014: Rotating Equipment Services; 2013: Turbo Services Market outlook generally positive despite unclear development in the oil and gas market Oil and Gas Power General Industry Low oil price might extend usage cycle of equipment New investments driven by low gas prices Mining in Latin America with improvement potential EU capacity reduction Scale back of conventional in Europe; Opportunities in MEA Industrial base (especially UK) declining in Europe Developing market Continuous growth of ISP opportunities Stability in Australia, opportunities in China AME EMEA APAC Our short-term market outlook Source: Market reports; Management opinion Rotating Equipment Services | Capital Market Day 2015 | slide 6 Leading position in growing and sustainable markets Our market position Gas Turbines Steam Turbines #2 service provider in addressable market OEM share ~70% #2 service provider in addressable market OEM share ~65% Compressors #3 service provider in addressable market OEM share ~55% Pumps #2 service provider in addressable market OEM share ~55% Electrical #1 service provider in addressable market OEM share ~30% Large installed base Headroom for growth in the markets Future-proof machines Ready for new technologies Large installed base and growth opportunity Rotating Equipment Services | Capital Market Day 2015 | Slide 7 Agenda – Rotating Equipment Services Sulzer Full Potential for RES Point of Departure Mission & Strategy Operational Excellence Summary Rotating Equipment Services | Capital Market Day 2015 | slide 8 Mission and growth drivers for Rotating Equipment Services RES Mission The worldwide preferred and integrated rotating equipment service provider with the best and broadest technical capabilities available Combine offer, optimize sites Operational Excellence Partnerships and joint ventures Close white spots Access new segments and services Provide more services to more customers Rotating Equipment Services | Capital Market Day 2015 | Slide 9 Our global footprint of over 100 service locations enables us to offer more services to more customers UK: 24 SCs Capability of Service Center Turbomachinery Type of location Service center Pumps Planned service center Electromechanical RES HQ Rotating Equipment Services | Capital Market Day 2015 | slide 10 Success stories: Leveraging RES structure in all regions Americas Tallgrass Pony Express Pipeline project Installation and commissioning of 15 pump / motor skids Insourcing of the installation service EMEA PCK Refinery overhaul project Compressor repair and retrofit in NL, DE, and CH Leverage existing relationship Asia-Pacific Singapore and Indonesia full scope Simplified service selection for a customer Offering the full service portfolio out of one shop Rotating Equipment Services | Capital Market Day 2015 | slide 11 Agenda – Rotating Equipment Services Sulzer Full Potential for RES Point of Departure Mission & Strategy Operational Excellence Summary Rotating Equipment Services | Capital Market Day 2015 | slide 12 Sulzer Full Potential: Spare parts growth and optimization of service branch network Spare Parts Full Potential Optimization Service Branch Network Optimization across entire spare parts value chain Individual branch action plans per branch for all product types Improved manufacturing and sourcing Co-location, right sizing and operational improvements of service branches for substantial cost improvements Pricing optimization and sales improvement Capability transfer for offering extensions of branches across products Streamlining of organization and processes Service full potential Rotating Equipment Services | Capital Market Day 2015 | Slide 13 Agenda – Rotating Equipment Services Sulzer Full Potential for RES Point of Departure Vision & Strategy Operational Excellence Summary Rotating Equipment Services | Capital Market Day 2015 | slide 14 RES delivery in line with Sulzer vision One Significant cost savings potential from functional integration Single contact point for customers to Sulzer services Reduced organization complexity Focused Market-oriented We are working together for the benefit of Sulzer Sharing of common market information between divisions Performance-critical equipment and service solutions Harmonized frontend, leveraged relationships Technology and market leadership Know how and expertise leveraging globally Shared KPI’s with PE Combined market and regional approach Rotating Equipment Services | Capital Market Day 2015 | Slide 15 Rotating Equipment Services: Generating value by providing “more services to more customers” Great market proposition with our combined offering Be the worldwide preferred and integrated rotating equipment service provider with the best and broadest technical capabilities available Focusing on operational excellence Opportunities to grow geographically and through acquisitions Rotating Equipment Services | Capital Market Day 2015 | slide 16 This document may contain forward-looking statements, including, but not limited to, projections of financial developments and future performance of materials and products, containing risks and uncertainties. These statements are subject to change based on known and unknown risks and various other factors that could cause the actual results or performance to differ materially from the statements made herein. Furthermore, the information shown herein has been compiled to the best knowledge of the authors. However, Sulzer Ltd. and its affiliated companies, including all directors, officers and employees cannot assume any responsibility for the quality of the information, and therefore any representations or warranties (expressed or implied) as to the accuracy or completeness of the information is excluded. Rotating Equipment Services | Capital Market Day 2015 | slide 17
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