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Sandvik Capital Markets Day 15 August 2002Sandvik’s Opportunities
SMC and Sandvik Rock ProcessingAnders Ilstam
President Sandvik Mining and Construction
Nils-Evert KarlssonPresident Sandvik Rock Processing
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 2
Anders Ilstam
! Born 1941, Sweden! President Sandvik Mining and
Construction! With Sandvik since 1993! Career:
" 1990 - 1998 President CTT Tools" 1987 - 1990 President SKF Tools" 1983 - 1987 President Antonson & Avery" 1978 - 1983 President Centro-
Morgårdshammar" 1974 - 1978 President Centro-Maskin
! Reengineering, golf, businessdevelopment
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 3
Nils-Evert Karlsson
! Born 1948, Sweden! President Sandvik Rock
Processing! With Sandvik since Oct. 2001! Career:
" 2001 President SRP" 1970- 2001 Various positions within
Svedala-Arbrå and Svedala Industri(Production Manager, Business AreaManager, Technical Manager, Presidentetc.)
! Golf, outdoor activities
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 4
Sandvik Mining and ConstructionMachinery, equipment and tools for rock-excavation
Proforma 2001: Sales SEK 14.8 B
VA-Eimco
Sandvik Rock Processing(as of Oct 1 2001)
Sandvik Tamrock
Sandvik Materials HandlingJV Sandvik Smith
Driltech Mission
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 5
SMC Key Figures (Yr 2001 and *pro forma)
SalesSEK M Employees
! Sandvik Tamrock 7 629 4 338! VA-Eimco 2 358 1 316! Driltech Mission 1 047 385! Sandvik Materials Handling 1 993 932! Sandvik Rock Processing* 1 400 876! Sandvik Smith* 360 131
Total, proforma 14 787 8 073
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 6
SMC - Financial Goals
! Annual growth 6% + acq.
! Profitability"ROCE 20%"EBIT 10-15%
! Improved capital efficiency
Average over a business cycle
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 7
0
100
200
300
400
500
99 00 01 020%
3%
6%
9%
12%
15%SEK M, Quarter
Operating profitInvoicingSEK M, Quarter
SEK M
Rolling 12 months EBIT %
0
1 000
2 000
3 000
4 000
5 000
99 00 01 020
5 000
10 000
15 000
Sandvik Mining and Construction
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 8
The Acquisition of Svedala Industri
The approval process
Metso
Svedala Industri AB
11 September 2001 - acquisition finalized
Sandvik Rock Processing
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 9
Sandvik Rock Processing -parts of Svedala
! Crushers, screens, mobile crushing units
! Sales SEK 1,400 M (EUR 140 M)
! Employees 900
! Production units in Svedala, Arbrå, Chauny
! 100 field sales people
! Acquisition of assets SEK 550 M incl. goodwill
! Consignment stock SEK 300 M
! Earnings per share rise as of 2002
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 10
Complementary Products Through Svedala
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 11
The Integration Process
! First meeting face to face
! Listen to people
! New colleagues
! Been acquired / buyer
! Union contacts National - EWC
! Build trust
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 12
World Market PotentialRock Processing
● World market SEK 50 B● Annual growth 2-3%
● Competition: m/s" Metso Mineral 9%" Terrex 8%" Sandvik Rock Processing 3%" EXTEC 1%" Kawasaki <1%
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 13
= Aggregate= Cement= Water= Reinforcement
= Aggregate= Bitumen
Concrete Asphalt
The Use of Aggregate
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 14
Sand & gravel Stone CoalOil Cement OthersIron ore
23 billion tons/year
The Feed Material
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 15
Jaw Crushers (E)Jaw Crushers (P)Hydrocone (E)Hydrocone (P)Other crushersScreensMobilesOthers
Northern EuropeCentral Europe South Europe & MEAfricaAsia & AustraliaNorth AmericaSouth America
Products Regions
(E)=Equipment(P)=Parts
Sales SEK 1.4 billion (2001)
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 16
Arbrå
Chauny
Svedala
Production Plants
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 17
Feed
Machines&
Process
Products
What it’s all about….
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 18
Grizzly Feeder
Jaw Crusher
HydroconeCrusher
VibratingScreen
Feed
Products
TunnelFeeder
A typical Crushing & Screening plant
Sandvik Mining and Construction, Page 19
Automation
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 20
R&D
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 21
Drivers for SRP
! Use existing strengths of SMC
! Construction industry
! Trend towards mobile crushing units
! Recycling
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 22
SRP´s Opportunities! Expanding after market
! Additional application areas
! Extended product program
! Recycling activities
! Increased focus on mining area
Sandvik Mining and ConstructionSandvik Capital Markets Day 15 August 2002, Page 23
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