ANDRITZ company presentation March 2015atl.g.andritz.com/c/com2011/00/03/26/32615/1/1/0/...The Schuler Group was consolidated into the consolidated financial statements of ANDRITZ

Company presentation March 2015

ANDRITZ GROUP

2. Results 2014

3. Long-term goals and outlook

1. ANDRITZ GROUP overview

KEY FINANCIAL FIGURES 2014

* MEUR = million euro

The ANDRITZ GROUP

Overview

Unit 2014

Order intake MEUR* 6,101.0

Order backlog (as of end of period) MEUR 7,510.6

Sales MEUR 5,859.3

EBITA MEUR 379.5

Net income (including non-controlling interests) MEUR 210.0

Employees (as of end of period; without apprentices) - 24,853

Profile: globally leading supplier of plants, equipment, and services for hydropower stations, the pulp and paper industry, the metal-

working and steel industries, and solid/liquid separation in the municipal and industrial sectors

Headquarters: Graz, Austria

Global presence: over 250 production sites and service/sales companies worldwide

3 Company presentation March 2015

Product offerings: equipment for production

of all types of pulp, paper, tissue, and board;

energy boilers

Order intake 2014: 1,996 MEUR

Sales 2014: 1,969 MEUR

Share of ANDRITZ GROUP’s total order intake: 30-35%

Worldwide leading position in four business areas

HYDRO and PULP & PAPER …

Product offerings: electromechanical equipment for

hydropower plants (turbines, generators); pumps;

turbo generators



Share of ANDRITZ GROUP’s total order intake: 30-35%


Product offerings: equipment for solid/liquid separation

for municipalities and various industries; equipment

for production of animal feed and biomass pellets

Order intake 2014: 596 MEUR

Sales 2014: 587 MEUR

Share of ANDRITZ GROUP’s total order intake: 10%

Product offerings: presses for metalforming (Schuler);

systems for production of stainless steel, carbon steel,

and non-ferrous metal strip; industrial furnace plants



Share of ANDRITZ GROUP’s total order intake: 25%

… METALS and SEPARATION


1,744

2,710

3,283

3,610

3,198

3,554

4,596

5,177

5,7115,859

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Compound Annual Growth Rate (CAGR) of Group sales 2005-2014:

+14% p. a. (thereof approximately half organic growth)

Strengthening of market position

Growth through organic expansion and acquisitions

Recent acquisitions by business area since 1990

2011 Iggesund Tools 2011 Tristar Industries 2011 Asselin-Thibeau 2012 AES 2013 MeWa METALS 1997 Sundwig 1998 Thermtec 2000 Kohler 2002 SELAS SAS Furnace Div. 2004 Kaiser 2005 Lynson 2008 Maerz 2012 Bricmont 2012 Soutec 2013 Schuler (> 95%) 2013 FBB Engineering 2014 Herr-Voss Stamco SEPARATION 1992 TCW Engineering 1995 Jesma-Matador 1996 Guinard 2000 UMT 2002 3SYS 2004 Bird Machine 2004 NETZSCH Filtration 2004 Fluid Bed Systems 2005 Lenser Filtration 2006 CONTEC Decanter 2009 Delkor Capital Equipment 2009 Frautech 2010 KMPT 2012 Gouda 2013 Shende Machinery

HYDRO 2006 VA TECH HYDRO 2007 Tigép 2008 GE Hydro business 2008 GEHI (JV) 2010 Precision Machine 2010 Hammerfest Strøm (59%) 2010 Ritz 2011 Hemicycle Controls PULP & PAPER 1990 Sprout-Bauer 1992 Durametal 1994 Kone Wood 1998 Kvaerner Hymac 1999 Winberg 2000 Ahlstrom Machinery 2000 Lamb Baling Line 2000 Voith Andritz Tissue LLC (JV) 2002 ABB Drying 2003 IDEAS Simulation 2003 Acutest Oy 2003 Fiedler 2004 EMS (JV) 2005 Cybermetrics 2005 Universal Dynamics Group 2006 Küsters 2006 Carbona 2006 Pilão 2007 Bachofen + Meier 2007 Sindus 2008 Kufferath 2009 Rollteck 2010 Rieter Perfojet 2010 DMT/Biax 2011 AE&E Austria


2. Results 2014



Financial highlights 2014

Order intake, sales, and order

backlog reach record highs

Order intake

6.1 bn. EUR

Sales

5.9 bn. EUR

Order backlog

7.5 bn. EUR

Earnings and margins substantially

improved compared to very low levels of 2013

Strong development of cash flow

and net cash position

Solid level of net working capital

Dividend proposal of 1.00 EUR/share

Company presentation March 2015 8

SALES by region 2014 vs. 2013 (%)

SALES by business area 2014 vs. 2013 (MEUR) GROUP SALES (MEUR)

* Schuler portion

The Schuler Group was consolidated into the consolidated financial statements of ANDRITZ as of March 1, 2013

Group sales

Slight increase due to Schuler

967* 1,178*

5,711 5,859

2014 2013 +/-

HYDRO 1,752 1,805 -3%

PULP & PAPER 1,969 2,005 -2%

METALS 1,551 1,311 +18%

SEPARATION 587 590 +/-0%

+3% (-1% ex Schuler)

5,859 MEUR

2014 2013

Europe 41 43

North America 16 16

South America 15 13

China 13 13

Asia (ex China) 11 11

Others* 4 4

Project-related lower

sales generation in

HYDRO and PULP &

PAPER

+8% ex Schuler

Emerging

markets: 43%

Europe & North

America: 57%

Well-balanced geographical

exposure in sales …

2013 2014 * Africa and Australia


ORDER INTAKE by region 2014 vs. 2013 (%)

ORDER INTAKE by business area 2014 vs. 2013 (MEUR) GROUP ORDER INTAKE (MEUR)

* Schuler portion


Group order intake significantly increased

PULP & PAPER and METALS favorably up

868*

1,194* 5,611

6,101

+9% (+3% ex Schuler)

* Africa and Australia

Also +37% ex Schuler

2014 2013 +/-

HYDRO 1,817 1,865 -3%

PULP & PAPER 1,996 1,908 +5%

METALS 1,693 1,234 +37%

SEPARATION 596 604 -1%

2014 2013

Europe 37 41

North America 18 18

South America 14 12

China 12 11

Asia (ex China) 12 14

Others* 7 4

6,101 MEUR

Emerging

markets: 45%

Europe & North

America: 55%

… and in order intake

2013 2014


ORDER BACKLOG by business area 2014 (%)

ORDER BACKLOG by business area 2014 vs. 2013 (as of end of period; MEUR) GROUP ORDER BACKLOG (as of end of period in MEUR) * Schuler portion


1,040* 1,058*

7,389 7,511

+2% (+2% ex Schuler)

Order backlog at record high, mainly driven by METALS

7,511 MEUR

2014 2013 +/-

HYDRO 3,709 3,722 +/-0%

PULP & PAPER 1,875 1,886 -1%

METALS 1,566 1,428 +10%

SEPARATION 361 353 +2%

+31% ex Schuler

2013 2014

HYDRO 49

PULP & PAPER 25

METALS 21

SEPARATION 5

HYDRO and

PULP & PAPER

account for ~75%

of total backlog


EBITA (MEUR) EBITA MARGIN (%)


164.1

379.5

+131%

Strong increase in earnings and profitability

compared to very low levels of 2013

2013 2014

2013:

2.9%

2014:

6.5%

Increase of EBITA and EBITA margin driven by strong

earnings improvements of PULP & PAPER, SEPARATION,

and METALS; unchanged good profitability of HYDRO


Unit 2014 2013 +/-

Order intake MEUR 6,101.0 5,611.0 +8.7%

Order backlog (as of end of period) MEUR 7,510.6 7,388.5 +1.7%

Sales MEUR 5,859.3 5,710.8 +2.6%

EBITDA MEUR 472.0 255.2 +85.0%

EBITA MEUR 379.5 164.1 +131.3%

EBIT MEUR 295.7 89.8 +229.3%

EBT MEUR 299.4 80.3 +272.9%

Financial result MEUR 3.7 -9.5 +138.9%

Net income (including non-controlling interests) MEUR 210.0 53.2 +294.7%

Cash flow from operating activities MEUR 342.1 93.7 +265.1%

Capital expenditure MEUR 106.5 111.4 -4.4%

Equity ratio % 17.0 16.7 -

Liquidity MEUR 1,701.6 1,517.0 +12.2%

Net liquidity (after deduction of all financial liabilities) MEUR 1,065.1 893.1 +19.3%

Net working capital MEUR -570.9 -539.4 -5.8%

EBITDA margin % 8.1 4.5 -

EBITA margin % 6.5 2.9 -

EBIT margin % 5.0 1.6 -

Employees (as of end of period; without apprentices) - 24,853 23,713 +4.8%

Key figures 2014 at a glance


Increase in net

liquidity driven by

strong cash flow

generation and

project-related

customer

advances

Unchanged solid

level of net

working capital


HYDRO (1)

Reasonable project activity, but far below peak level of 2011

MODERNIZATIONS/REHABILITATIONS

Solid project activity in Europe and North

America, although below peak years

NEW HYDROPOWER PLANTS

Some projects in emerging markets in

implementation or planning phase

(particularly in South America and Africa)

COMPETITION

Stable competition at challenging level

PUMPS

Solid project activity

The consortium GE/ANDRITZ HYDRO is appointed preferred bidder for the supply of the electromechanical

equipment for the world’s first tidal lagoon hydropower project in Swansea Bay, Wales. The hydropower plant

will have a total capacity of 320 megawatts.

Ph

oto

: T

ida

l L

ag

oo

n S

wa

nse

a B

ay p

lc.


Unit 2014 2013 +/-

Order intake MEUR 1,816.7 1,865.4 -2.6%

Order backlog (as of end of period) MEUR 3,708.6 3,722.4 -0.4%

Sales MEUR 1,752.3 1,804.8 -2.9%

EBITDA MEUR 177.2 176.8 +0.2%


EBITA MEUR 144.8 146.9 -1.4%



HYDRO (2)

Satisfactory business development

Slight project-related

decline in sales

Earnings and margin

at unchanged

satisfactory levels

Order intake in

line with

expectations

Increase of

employees related to

projects in South

America and Turkey


PULP & PAPER (1)

Good investment and project activity

MODERNIZATIONS/GREENFIELD

Good project and investment activity for

modernizations/refurbishments and for

new greenfield pulp mills

BIOMASS/RECOVERY BOILERS

Good investment activity

COMPETITION

Unchanged challenging price competition

TISSUE

Solid demand, especially in China

Ph

oto

: M

ets

ä F

ibre

Oy

ANDRITZ has signed a letter of intent with Metsä Fibre to deliver key production technologies for a new bio-

product pulp mill in Finland.


PULP & PAPER (2)

Strong improvement in earnings and profitability

Favorable order intake

of almost 2 billion euros

Slight project-related

decline in sales

Earnings and margin

recovered compared to

low level in 2013; good

profitability development in

service, capital still

impacted by execution of

some lower margin orders

Unit 2014 2013 +/-


Order backlog (as of end of period) MEUR 1,875.4 1,885.6 -0.5%

Sales MEUR 1,969.3 2,005.3 -1.8%

EBITDA MEUR 127.6 -11.5 +1,209.6%

EBITDA margin % 6.5 -0.6 -

EBITA MEUR 102.9 -35.7 +388.2%

EBITA margin % 5.2 -1.8 -



METALS (1): good investment activity

in metal forming and for aluminum equipment

METALFORMING

Good project activity, especially in China;

satisfactory level in Europe

STAINLESS STEEL

Unchanged low project activity, however some

selective investments in emerging markets

COMPETITION

Stable competition at challenging level

ALUMINUM

Very good project activity

One of the largest orders in Schuler’s 175-year history was received from FAW Volkswagen

Automotive, China. The order comprises three press lines with ServoDirect technology. The servo-

press lines are used mainly to produce car body parts, such as hoods or doors.


METALS (2)

Favorable business development

Order intake favorably

up due to the metal-

forming (Schuler) and

aluminum equipment

Sales increase mainly

due to Schuler (ex

Schuler: +8.0%)

Satisfactory earnings and

margin development

compared to 2013, which

was impacted by

restructuring provisions

by Schuler; EBITA 2014

positively influenced by

release of provision

overhang 2014


Unit 2014 2013 +/-


Order backlog (as of end of period) MEUR 1,566.1 1,427.6 +9.7%

Sales MEUR 1,550.4 1,311.0 +18.3%

EBITDA MEUR 134.0 76.6 +74.9%


EBITA MEUR 110.2 53.5 +106.0%




ENVIRONMENT AND FOOD

Solid investment activity

SEPARATION (1)

MINING AND MINERALS

Unchanged low project activity

FEED AND BIOMASS PELLETING

Good project activity

CHEMICALS

Solid project activity

For the waste water treatment plant, industrial effluent treatment plant, and food application segments,

ANDRITZ launched a new sludge dewatering machine: the ANDRITZ C-Press is a screw press providing

high performance and combining compact design with low operating costs.


SEPARATION (2)

Order intake and sales stabilized, earnings improved

Order intake and sales

practically unchanged

compared to 2013

Earnings and margin back

on track compared to low

level in 2013 (additional

costs related to launch of

new products in China)

Unit 2014 2013 +/-

Order intake MEUR 595.8 604.1 -1.4%

Order backlog (as of end of period) MEUR 360.5 352.9 +2.2%

Sales MEUR 587.3 589.7 -0.4%

EBITDA MEUR 33.2 13.3 +149.6%


EBITA MEUR 21.6 -0.6 +3,700.0%

EBITA margin % 3.7 -0.1 -





2. Results 2014

4.7

5.2 5.3 5.1

6.3 6.1 6.1

6.4 6.5

5.1*

7.2 7.2 6.9

2.9**

6.5

937 1,319

1,110 1,225 1,481

1,744

2,710

3,283 3,610

3,198 3,554

4,596

5,177

5.711** 5,859

0

1,000

2,000

3,000

4,000

5,000

6,000

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

EBITA margin (%) Sales (MEUR)

* Including restructuring expenses ** Including Schuler as of March 1, 2013; no pro forma figures are available for the reference periods of previous years

Target to continue long-term profitable growth

Goal: maintain 7% and improve to 8% with top-line sales growth

23

%

MEUR

Long term:

maintain 7%

and improve to

8% with top-line

sales growth

Average

2005-2009:

6.0% Average

2000-2004:

5.3%

5.7

Company presentation March 2015

Outlook for 2015

Investment activity to remain at current satisfactory levels

HYDRO

Good project activity for modernizations and new hydropower stations to

continue; satisfactory market activity for pumps to continue

PULP & PAPER

Solid project activity for modernizations/capacity increases and power/

biomass boilers; good pipeline for green-/brownfield pulp mill projects

METALS

Global metalforming market to stay at good level; steel at unchanged

subdued level; good market activity in aluminum to continue

SEPARATION

Low project activity in mining to remain; solid project activity in chemicals;

good investment activity in environment, food, and feed/biomass pelleting

stable +/-

stable +

stable +

stable +

ANDRITZ GROUP 2015

Slight increase in sales

and improvement of

earnings expected


Financials

Appendix:

4,132

5,707

4,924 5,611

6,101

2010 2011 2012 2013 2013

3,554

4,596 5,177

5,711 5,859

2010 2011 2012 2013 2014

7.2 7.2 6.9

2.9

6.5

2010 2011 2012 2013 2014

ANDRITZ GROUP

Sales, order intake, EBITA, and EBITA margin 2010-2014

Sales (in MEUR): CAGR +13%

26

Order intake (in MEUR): CAGR +10%

EBITA (in MEUR)

EBITA margin (in %)

Average

4,979 MEUR

Average

5,295 MEUR

Average

298 MEUR

Average

6.1%

257.6

331.5 357.8

164.1

379.5

2010 2011 2012 2013 2014

1,870 2,096 2,008

1,865 1,817

2010 2011 2012 2013 2014

1,579 1,773 1,837 1,805 1,752

2010 2011 2012 2013 2014

HYDRO



27

Order intake (in MEUR): CAGR -1%

EBITA (in MEUR)

EBITA margin (in %)

Average

1,749 MEUR

Average

1,931 MEUR

Average

142 MEUR

Average

8.1%

118.0

147.7 153.2 146.9 144.8

2010 2011 2012 2013 2014

7.5 8.3 8.3 8.1 8.3

2010 2011 2012 2013 2014

1,416

2,694

1,962 1,908 1,996

2010 2011 2012 2013 2014

1,130

1,885

2,282 2,005 1,969

2010 2011 2012 2013 2014

Average

4.6%

7.3 6.4

5.9

-1.8

5.2

2010 2011 2012 2013 2014

82.2

120.4 134.6

-35.7

102.9

2010 2011 2012 2013 2014

PULP & PAPER



28


EBITA (in MEUR)

EBITA margin (in %)

2013

2013

Average

1,854 MEUR

Average

1,995 MEUR

Average

81 MEUR

5.4 5.2

6.2

4.1*

7.1**

2010 2011 2012 2013 2014

18.4 19.4 25.1

53.5

110.2

2010 2011 2012 2013 2014

303 319 324

1,234

1,693

2010 2011 2012 2013 2014

340 373 405

1,311

1,550

2010 2011 2012 2013 2014

METALS


Sales (in MEUR): CAGR +46%*

29

Order intake (in MEUR): CAGR +54%*

EBITA (in MEUR)

EBITA margin (in %)

* +2% ex Schuler

* +13% ex Schuler

Average

ex Schuler:

367 MEUR

Schule

r: 9

67

S

chule

r:

868

39.7

*

* Schuler: 4.1% (8.4% before restructuring expenses)

Average

ex Schuler:

362 MEUR

Average

ex Schuler:

17.7 MEUR

Average

ex Schuler:

4.8%

Schule

r: 1

,178

S

chule

r:

1,1

94

* thereof Schuler

98.4

*

** Schuler: 8.4%

544

598

629

604 596

2010 2011 2012 2013 2014

505 566

653 590 587

2010 2011 2012 2013 2014

Average

5.2%

7.7 7.8 6.9

-0.1

3.7

2010 2011 2012 2013 2014

SEPARATION



30

39.0 44.0 44.9

-0.6

21.6

2010 2011 2012 2013 2014


EBITA (in MEUR)

EBITA margin (in %)

Average

580 MEUR

Average

594 MEUR

Average

30 MEUR

Documents

ANDRITZ company presentation March 2015atl.g.andritz.com/c/com2011/00/03/26/32615/1/1/0/...The Schuler Group was consolidated into the consolidated financial statements of ANDRITZ