CAPITAL MARKETS DAY. Anders Thelin. Tanya Fratto. President Sandvik Tooling. Diamond Innovations

Transcription

1 CAPITAL MARKETS DAY 2007 Anders Thelin President Tanya Fratto President Diamond Innovations

2 Agenda Update Business model Growth levers Strategic acquisitions Market leadership Capacity and productivity Future opportunities

3 Agenda Update Business model Growth levers Strategic acquisitions Market leadership Capacity and productivity Future opportunities

4 Tools and tooling systems for metalworking Wear parts and superabrasive components Solutions using products in cemented carbide, high-speed steel, synthetic diamond, cubic boron nitride and special ceramics Sales SEK 22,500 M 2006 EBIT SEK 5,191 M, 23.1% ROCE 34.4% 15,100 employees

5 Financial objectives Sandvik Tooling Sandvik Mining i and Construction Sandvik Materials Technology Growth 7% 9% 8% ROCE 30% 25% 20%

6 Q Invoiced sales SEK M, Quarter EBIT- margin* ROCE 12-months* % * 30% 25% 20% 15% 10% % 0 0% Adjusted to IFRS from 2004 * Excluding one-offs in PTD in Q Continued strong growth Invoiced sales +12% Organic growth +9% EBIT +19%, 24.8% of sales SEK 1,568 M Currency effect SEK -90 M Insurance comp. >+1% unit Diamond Innovations -1% unit ROCE 33.8% (32.9%) Diamond Innovations -1.5% unit

7 Sales by customer segment 2006 Small Part Machining Aerospace Pump & Valve Automotive Mechanical engineering Die & Mould Heavy Equipment Oil & Gas Medical Machine Tool Makers

8 Sales by customer segment 2006 Small Part Machining Aerospace Pump & Valve Automotive Mechanical engineering Die & Mould Heavy Equipment Oil & Gas Medical Machine Tool Makers

9 Sales by region 2006 Asia Australia, New Zealand Eastern Europe Africa, Middle East South America Western Europe NAFTA

10 Profitable growth SEK M % 45% % % 30% 25% 20% 15% 10% 5% Invoicing ROCE ROCE target EBIT-margin %

11 Profitable growth SEK M % % % % Invoicing Organic growth Growth target % %

12 Agenda Update Business model Growth levers Strategic acquisitions Market leadership Capacity and productivity Future opportunities

13 Customer offer

14 Creating customer value

15 Business model SEK 116 B SEK B MSEK Tools Workpiece Material Machinery & Equipment Operators Overhead 4-5%

16 Productivity leverage Cost reduction Cost reduction per component: -1% per component: -15% Free capacity

17 Utilization h

18 Platform for superior growth Multibrand strategy >7% Global presence Sales and Marketing Production and distribution Sandvik Tooling growth premium Research and Development Market growth ~4 %

19 Agenda Update Business model Growth levers Strategic acquisitions Market leadership Capacity and productivity Future opportunities

20 Diamond Stainless Steel Cemented Carbide High Speed Steel Cubic Boron Nitride (CBN) Ceramics Diamond & CBN Growth potential 10% Fully integrated value chain

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24 Sales by region 2006 Diamond Innovations

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26 Polycrystalline products Granular products

27 Macroeconomic trends Demands Smaller, stronger, lighter products Stricter environmental regulations Material Offer Composite materials Machining compact graphite iron Efficient aluminum machining i

28 Successful combination Cemented carbide technology Know-how cemented carbide metal-cutting applications Strong R&D culture Diamond Innovations Superhard material technology Know-how diamond & CBN superabrasive applications Strong R&D culture

29 Sandvik and Diamond Innovations Successful combinations Future applications Oil & Gas Exploration drilling

30 Diamond Innovations Sales 2006 SEK >1,000 M Global presence 600 employees Complementary business Main units in US & Ireland

31 Agenda Update Business model Growth levers Strategic acquisitions Market leadership Capacity and productivity Future opportunities

32 Market leader in major industrial markets % share of global production, % 20% 15% 10% 5% 0% USA China Japan * Germany Eastern Europe *Note: Market leadership among non-asian manufacturers Source: Economist Intelligence Unit UK Italy

33 and in fast growing g markets Actual production growth, % 16% 14% 12% 10% 8% 6% 4% 2% 0% China South Korea * India Eastern Europe Germany USA Japan * *Note: Market leadership among non-asian manufacturers Source: Economist Intelligence Unit

34 and where the absolute growth is Production growth 2006, in SEK B *Note: Market leadership among non-asian manufacturers Source: Economist Intelligence Unit

35 400 in China Index, 100=

36 in India Index, 100=

37 in Russia Index, 100=

38 Agenda Update Business model Growth levers Strategic acquisitions Market leadership Capacity and productivity Future opportunities

39 Consolidation of production Diamond Innovations

40 Westminster South Carolina, USA

41 São Paulo Brazil

42 Sandvik Hard Materials Barcelona, Spain

43 Chiplun India

44 Walter Tübingen, Germany

45 Walter Münsingen, Germany Walter, Münsingen

46 Schmalkalden Germany

47 Improved productivity % growth Diamond Innovations

48 Resources to the front line Index, 100= Invoicing, SEK M Administration Sales and marketing

49 Agenda Update Business model Growth levers Strategic acquisitions Market leadership Capacity and productivity Future opportunities

50 Growth activities Multibrand strategy Brand positioning Global presence Strategic acquisitions Sales and Marketing Expansion of sales force Production and distribution Continued consolidation & rationalization Research and Development Increased New Sales Ratio Market growth Reinforced leadership in high-growth h markets

51 reinforced with diamonds