Kongsberg Maritime Torfinn Kildal, President WORLD CLASS through people, technology and dedication
Kongsberg Maritime Business Model & Strategic Direction Offshore & Merchant Marine Yachting & Fishery Summary
Kongsberg Maritime market segments Kongsberg Maritime Offshore & Merchant Marine Dynamic Positioning & Navigation Marine Automation Process Automation Hydroacoustics Satellite Positioning & AIS Marine IT Yachting, Fishery & Commercial (SIMRAD) Autosteering, Hydroacoustics, Communication, Navigation
...more than 50 years in the Marine business
Focus on core applications, develop and maintain leading market positions DynPos & Positioning Automation & Controls Offshore & Subsea Hydroacoustic Simulation Merchant Marine & Maritime Training Communication Navigation Information Technology Yachting, Commercial and Fishery
Building on two strong Brands Maximize marine performance Maximizing your performance at sea Addressing the markets ; Offshore & Merchant Marine - Yachting, Commercial & Fisheries
Business model strategic direction Some key drivers Focus on products, systems and applications which are important to operators and owners Focus on both ship-builder and ship-owner operator/ users Focus on innovative and reliable solutions. Staying in technology forefront. Combining commercial available and proprietary technology. Focus on functionality and cost reductions Core technologies shall be used in several applications
Building strong international operations Strong presence in important marine and offshore areas Existing operations are a sound platform for further expansion Newfoundland (Canada) Nova Scotia (Canada) Norway British Columbia (Canada) Scotland Washington (USA) England Connecticut (USA) Texas (USA) France Italy Spain Morocco Louisiana (USA) Florida (USA) North Carolina (USA) Peru Brazil Nigeria Sweden Denmark Germany The Netherlands India South Korea China Singapore Norway 22 % Asia 24 % New York (USA) Chile South Africa Europe 31 % Americas 23 % Distribution of operating revenues
Building strong international operations Some key drivers Closer to our customers - Our international operations increase their scope to include - Installations, engineering, commissioning Continue to develop a strong global customer support - Brazil, West Africa Our operations in Asia will be hubs for global sourcing and supply management.
Building robust operations - Merchant Marine Ship (> 500 GT ) Deliveries 2001-2004 1200 1000 800 600 400 RR,RPx Container Bulker Tanker 200 0 2001 2002 2003 2004 Source; Loyds Fairply 2004/nov
Building robust operations Offshore & Subsea Seismic Field survey Field development Exploration Subsea Construction Production Storage Transportation
Offshore & Merchant Marine
Offshore & Merchant Marine DynPos & Positioning Navigation Automation & Controls Hydroacoustics Simulation Others 3 % Merchant marine 36 % Offshore & Subsea 61 %
Offshore & Merchant Marine Financial performance 3 500 350 3 000 300 2 500 250 MNOK 2 000 1 500 200 150 MNOK 1 000 100 500 50 0 1995 1996 1997 1998 1999 2000 2001 2002 2003 0 Operating revenues EBITA
Offshore & Merchant Marine Financial performance Operating revenues & EBITA % Order intake - quarterly 3 500 12 3 000 10 2 500 8 2 000 1 500 1 000 6 4 859 730 912 656 670 744 544 568 697 500 2 0 2001 2002 2003 2004-3Q 0 1Q 2Q 3Q Operating revenues 2004-3q EBITA % 2002 2003 2004
Offshore & Merchant Marine; Dynamic Positioning 1000 750 500 250 0 2001 2002 2003 2001 2002 2003 Maintain strong position within demanding applications No.3 15 % Dynamic Positioning Market Position Extended product range give access to new applications New product range increase our competitiveness in Offshore Support Vessels segment No.2 16 % KM-DP 44 % Important aftermarket Others 25 %
Offshore & Merchant Marine; Marine Automation 1000 750 500 250 0 2001 2002 2003 2001 2002 2003 Strong market position - Strong product range Integrated Automation Systems Machinery monitoring Propulsion Control Tank Level gauging No.2 14 % No.3 12 % Marine Automation Market Position KM-MA 23 % - Strong market presence Leading global supplier Others 51 %
Offshore & Merchant Marine; Marine Automation Ship ( > 500 GT ) Shipyard Contracting 2001-2004 We will continue to develop our presence in North East Asia and Europe New products are being introduced Strong order backlog 2000 1800 1600 1400 1200 1000 800 600 400 200 0 2001 2002 2003 2004 RR,RPx Container Bulker Tanker Source; Loyds Fairplay 2004 nov
Offshore & Merchant Marine; Hydroacoustics 1000 750 500 250 0 2001 2002 2003 2001 2002 2003 Subsea technology is becoming more important Use of Hydroacoustic technology are increasing Short term negative impact due to slower demand for Underwater Navigation Fragmented market, has a leading position No.2 11 % Hydroacoustics Market Positions Offshore & Survey No.3 9 % KM - HYD 26 % Other 59 %
Civil and Naval applications, equal in size
Yachting & Fishery
Yachting & Fishery Autosteering Navigation Hydroacoustics Communication Yachting, Commercial and Fishery Commercial 17 % Fisheries 30 % Yachting 53 %
Yachting & Fishery Financial performance 1000 100 900 90 800 80 700 70 600 60 MNOK 500 50 MNOK 400 40 300 30 200 20 100 10 0 1995 1996 1997 1998 1999 2000 2001 2002 2003 0 Operating revenues EBITA
Yachting & Fishery; Financial performance 1 000 12 750 500 250 10 8 6 4 2 Price pressures challenging margins Increased sales to boatbuilders Investments are low in the fisheries markets 0 2001 2002 2003 2004 0 Operating revenues Operating revenues 2004 3q EBITA %
Yachting & Fishery; Yachting We have good market position in medium to high end motor boats State-of-theart Acquisition of B&G have given SIMRAD access to high end sailboat segment Single Products Competition has increased, resulting in price pressure Total solutions Industry consolidation is ongoing Discount
Yachting & Fishery; Market positions in Yachting State-of-the-art SIMRAD Yachting Market positions High Medium end No.2 24 % SIMRAD 15 % Single roducts r Total solutions No.1 34 % Others 27 % Discount New companies is entering medium to high end segments Boatbuilder segment becoming more important SIMRAD takes markets shares in Boatbuilder segments
Yachting & Fishery; Fisheries Two main segments; Deep sea and Coastal SIMRAD has strong position in high end Deep sea fishing and Fishery research SIMRAD is entering Coastal fisheries, as demand for marine electronics increases Weak market conditions No.2 21 % No.1 35 % SIMRAD Fishing Market position SIMRAD 9 % Others 35 %
Kongsberg Maritime Business Model & Strategic Direction Offshore & Merchant Marine Yachting & Fishery Summary
Kongsberg Maritime Summary We will continue our current Business Model and Strategic Direction However, all operations are undergoing strategic and operational audit, which may result in structural changes We expect high activity in Offshore, Subsea and Merchant Marine. We are satisfied with our overall positions in these areas, they constitute a sound platform for further expansion Yachting and Fishery (Y&F) market conditions are changing. We are in process of making Y&F better fit to adopt to such changes. We have launched several internal programmes for cost reductions and increased competitiveness