Interim Report Q4 2007Interim Report Q4 2007
Mr. Lars RenstrMr. Lars RenströömmPresident and CEOPresident and CEOAlfa Laval GroupAlfa Laval Group
-- Orders received and marginsOrders received and margins-- HighlightsHighlights-- Development per segmentDevelopment per segment-- Geographical developmentGeographical development-- Financials Financials -- OutlookOutlook
© Alfa Laval Slide 3 www.alfalaval.com
Key figures
Orders received up 0% to SEK 6,576 million.Orders received up 0% to SEK 6,576 million.
Net sales up 21% to SEK 7,220 million.Net sales up 21% to SEK 7,220 million.
Adjusted EBITA up 65% SEK 1,675 million. Adjusted EBITA up 65% SEK 1,675 million.
-- Negative currency effect SEK 44 million.Negative currency effect SEK 44 million.
October October –– December 2007December 2007
January January –– December 2007December 2007
Orders received up 18% to SEK 27,553 million.Orders received up 18% to SEK 27,553 million.
Net sales up 29% to SEK 24,849 million.Net sales up 29% to SEK 24,849 million.
Adjusted EBITA up 65% to SEK 4,980 million. Adjusted EBITA up 65% to SEK 4,980 million.
-- Negative currency effect SEK 254 million.Negative currency effect SEK 254 million.
© Alfa Laval Slide 4 www.alfalaval.com
Proposed dividend, repurchase and splitProposed dividend, repurchase and split
Proposed mandate for repurchase of sharesProposed mandate for repurchase of shares
The Board of Directors proposes a new mandate for repurchaseThe Board of Directors proposes a new mandate for repurchase
of up to 5 percent of the issued shares with the intentionof up to 5 percent of the issued shares with the intention
to cancel repurchased shares.to cancel repurchased shares.
Proposed dividend for 2007Proposed dividend for 2007
The Board of Directors proposes a dividend of 9:00 SEK (6:25).The Board of Directors proposes a dividend of 9:00 SEK (6:25).
Proposed share split 4:1Proposed share split 4:1
The Board of Directors proposes a share split 4:1 The Board of Directors proposes a share split 4:1 –– each old each old
share will be split into 4 new shares. If the proposal is acceptshare will be split into 4 new shares. If the proposal is accepted ed
the split is expected to be completed during June 2008the split is expected to be completed during June 2008 ..
© Alfa Laval Slide 5 www.alfalaval.com
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
0
4 000
8 000
12 000
16 000
20 000
24 000
28 000
32 000
SEK millionSEK millionQ
404
Q40
4
Q10
5Q
105
SEK million R 12SEK million R 12
Q20
5Q
205
Orders receivedOrders received
= rolling twelve months value
Q30
5Q
305
= order intake per quarter
Q40
5Q
405
Q10
6Q
106
Q20
6Q
206
Q30
6Q
306
= % development at constant rates by quarter year on year
+ 5
%+
5%
+ 5
%+
5%
+ 9
%+
9%
+25%
+25%
+23%
+23%
+28%
+28%
+35%
+35%
+17%
+17%
+xx%
+40%
+40%
Q40
6Q
406
Q10
7Q
107
+36%
+36%
Q20
7Q
207
+13%
+13%
+30%
+30%
Q30
7Q
307
Q40
7Q
407
0%0%
© Alfa Laval Slide 6 www.alfalaval.com
Order analysisOrder analysis
2006 2006 (SEK million)(SEK million)
Structural change, %Structural change, %Currency effects,%Currency effects,%Organic development, %Organic development, %Total, %Total, %2007 2007 (SEK million)(SEK million)
6,6726,672
OctOct –– Dec 07Dec 07
6,5766,576
+ 1+ 1-- 2 2
00-- 11
© Alfa Laval Slide 7 www.alfalaval.com
0
225
450
675
900
1 125
1 350
1 575
1 800
0,0
3,0
6,0
9,0
12,0
15,0
18,0
21,0
24,0
SEK million and in percent of salesSEK million and in percent of sales
* Adjusted EBITA – ”Earnings before interests, taxes, amortization of goodwill and step up values and comparison distortion items.”
Adjusted EBITA / margin *Adjusted EBITA / margin *
Q404Q404 Q105Q105 Q205Q205 Q305Q305 Q405Q405 Q106Q106 Q206Q206 Q306Q306 Q406Q406 Q107Q107 Q207Q207 Q307Q307 Q407Q407
Interim Report Q4 2007Interim Report Q4 2007
Mr. Lars RenstrMr. Lars RenströömmPresident and CEOPresident and CEOAlfa Laval GroupAlfa Laval Group
-- Orders received and marginsOrders received and margins-- HighlightsHighlights-- Development per segmentDevelopment per segment-- Geographical developmentGeographical development-- Financials Financials -- OutlookOutlook
© Alfa Laval Slide 9 www.alfalaval.com
Highlights during the quarterHighlights during the quarterAcquisitions during 2007 Acquisitions during 2007 –– add 4% annual salesadd 4% annual sales
Finnish company Finnish company FincoilFincoil, turnover SEK 375 million. , turnover SEK 375 million. Manufactures and markets air heat exchangers predominantly for Manufactures and markets air heat exchangers predominantly for
industrial cooling and refrigeration. industrial cooling and refrigeration.
The company has 150 employees.The company has 150 employees.
© Alfa Laval Slide 10 www.alfalaval.com
Highlights during the quarterHighlights during the quarterLarge orders, total SEK 160 million (680) Large orders, total SEK 160 million (680)
Clean technology to CanadaClean technology to Canada..Order value SEK 50. Delivery during 2008 and 2009.Order value SEK 50. Delivery during 2008 and 2009.
© Alfa Laval Slide 11 www.alfalaval.com
Highlights during the quarterHighlights during the quarterLarge ordersLarge orders
Clean technology to Canada.Clean technology to Canada.
Energy recovery in natural gas productionEnergy recovery in natural gas production
in South East Asia.in South East Asia.Total value SEK 110 million. Delivery during 2008 and 2009.Total value SEK 110 million. Delivery during 2008 and 2009.
© Alfa Laval Slide 12 www.alfalaval.com
Highlights during the quarterHighlights during the quarterLegislation drives development of clean technologiesLegislation drives development of clean technologies
Orders for seven ballast water treatment systems.Orders for seven ballast water treatment systems.CombinedCombined the orders are the orders are worthworth aboutabout SEK 25 million.SEK 25 million.
DeliveriesDeliveries duringduring 2008 and 2009. 2008 and 2009.
© Alfa Laval Slide 13 www.alfalaval.com
5050 CanadaCanada Water treatmentWater treatment EnvironmentEnvironment 20082008180180 ChinaChina EvaporationEvaporation Pulp and paper Pulp and paper 200720075555 ChinaChina ProcessingProcessing FoodFood 200720075050 VietnamVietnam (Various)(Various) MarineMarine 20072007--20082008
100100 USA/TaiwanUSA/Taiwan Central coolingCentral cooling Oil refiningOil refining 2008 2008 5050 BelgiumBelgium ProcessingProcessing Bio ethanolBio ethanol 20082008
190190 Saudi ArabiaSaudi Arabia Central coolingCentral cooling PetrochemicalPetrochemical 20092009135135 EuropeEurope ProcessingProcessing FoodFood 200820086060 IndiaIndia Clean technologyClean technology Pulp and paperPulp and paper 200820085050 Latin AmericaLatin America ProcessingProcessing PetrochemicalPetrochemical 2008200850 50 UkraineUkraine ProcessingProcessing Food/breweryFood/brewery 200820086565 USAUSA EvaporationEvaporation Process IndustryProcess Industry 200820085050 CanadaCanada Water treatmentWater treatment EnvironmentEnvironment 20082008--20092009
110110 S. East AsiaS. East Asia Energy recoveryEnergy recovery EnergyEnergy 20082008--200920091,1951,195
Large orders 2007Large orders 2007SEK millionSEK million CountryCountry ApplicationApplication IndustryIndustry DeliveryDelivery
(1,405 in 2006)
Interim Report Q4 2007Interim Report Q4 2007
Mr. Lars RenstrMr. Lars RenströömmPresident and CEOPresident and CEOAlfa Laval GroupAlfa Laval Group
-- Orders received and marginsOrders received and margins-- HighlightsHighlights-- Development per segmentDevelopment per segment-- Geographical developmentGeographical development-- Financials Financials -- OutlookOutlook
© Alfa Laval Slide 15 www.alfalaval.com
Orders received by SegmentOrders received by Segment
Comfort & RefrigerationComfort & Refrigeration
SanitarySanitary
Marine & DieselMarine & Diesel
Fluids & UtilityFluids & UtilityOEMOEM
Parts & ServiceParts & Service
Life ScienceLife Science
Process IndustryProcess Industry
Energy & EnvironmentEnergy & Environment
FoodFood
October October –– December 2007, December 2007, at constant ratesat constant rates
+
+
+
−
+
+
−−
−+
© Alfa Laval Slide 16 www.alfalaval.com
Orders received by SegmentOrders received by SegmentThe Process Technology Division, October The Process Technology Division, October –– December 2007,December 2007,at constant rates and for comparable unitsat constant rates and for comparable units
Weak start, we ended Weak start, we ended the quarter well.the quarter well.
Strong base businessStrong base businessin all segments. in all segments.
Recovery in the EnergyRecovery in the Energy& Environment segment. & Environment segment.
Life ScienceLife Science
Process IndustryProcess Industry
Energy & EnvironmentEnergy & Environment
FoodFood
−
+
−
−
© Alfa Laval Slide 17 www.alfalaval.com
Orders received by SegmentOrders received by SegmentThe Equipment Division, October The Equipment Division, October –– December 2007, December 2007, at constant rates and for comparable unitsat constant rates and for comparable units
Comfort & RefrigerationComfort & Refrigeration
SanitarySanitary
Marine & DieselMarine & Diesel
Fluids & UtilityFluids & Utility
OEMOEM
Continued strong marketsfor the Marine & Dieselsegment.
Weak market forheat pumps (OEM).
Good demandfrom food and beverage.
+
+
+
−
+
© Alfa Laval Slide 18 www.alfalaval.com
Air heat exchangersAir heat exchangers
● Two complementary acquisitions during 2007: Helpman (the Netherlands) and Fincoil (Finland).
● Now no 2 on the European market for industrial refrigeration,a market with an estimatedpotential of SEK 5.5 billion.
● Markets with structural growth - increased living standard and a need for new environmentally friendly refrigerants.
Building a strong positionBuilding a strong position
© Alfa Laval Slide 19 www.alfalaval.com
Orders received by SegmentOrders received by Segment
Comfort & RefrigerationComfort & Refrigeration
SanitarySanitary
Marine & DieselMarine & Diesel
Fluids & UtilityFluids & UtilityOEMOEM
Parts & ServiceParts & Service
Life ScienceLife Science
Process IndustryProcess Industry
Energy & EnvironmentEnergy & Environment
FoodFood
January January –– December 2007, December 2007, at constant ratesat constant rates
++ +
++
+
+
+
−
=
Interim Report Q4 2007Interim Report Q4 2007
Mr. Lars RenstrMr. Lars RenströömmPresident and CEOPresident and CEOAlfa Laval GroupAlfa Laval Group
-- Orders received and marginsOrders received and margins-- HighlightsHighlights-- Development per segmentDevelopment per segment-- Geographical developmentGeographical development-- Financials Financials -- OutlookOutlook
© Alfa Laval Slide 21 www.alfalaval.com
Orders received by RegionOrders received by Region
CentrCentr. & East 10 %
. & East 10 %
North America 16 %
North America 16 %
Asia 33 %Asia 33 %
L. America 6 %
L. America 6 %
Other 2 %
Other 2 %
Western EuropeWestern Europe23 %23 %
Nordic 10 %
Nordic 10 %
+37+37
+7+7
October October –– December 2007, December 2007, at constant ratesat constant rates
+20+20
+7+7--1212--1717
© Alfa Laval Slide 22 www.alfalaval.com
Highlights AmericasHighlights Americas
North AmericaNorth AmericaSubstantially lower orderSubstantially lower orderintake for the bio ethanolintake for the bio ethanolapplication.application.
Base business up 5 percent.Base business up 5 percent.
Latin AmericaLatin AmericaGood development in all segments Good development in all segments -- strongest in Comfort & Refrigerationstrongest in Comfort & Refrigeration
and Energy & Environment.and Energy & Environment.
Best growth in Mexico, ColombiaBest growth in Mexico, Colombiaand Chile.and Chile.
October October –– December 2007, December 2007, at constant ratesat constant rates
+37+37
--1717
© Alfa Laval Slide 23 www.alfalaval.com
Highlights EuropeHighlights Europe
Western Europe incl. NordicWestern Europe incl. NordicThe Equipment Division in lineThe Equipment Division in linewith Q4 2006, despite a downturnwith Q4 2006, despite a downturnin the heat pump market.in the heat pump market.
Best development in the Nordic Best development in the Nordic and and IbericaIberica regions.regions.
Central and Eastern EuropeCentral and Eastern EuropeStable growth in both divisions. Russia and Turkey showedthe best development..
October October –– December 2007, December 2007, at constant ratesat constant rates
+20+20
+7+7--1212
© Alfa Laval Slide 24 www.alfalaval.com
Highlights AsiaHighlights Asia
AsiaAsiaBest development in Food,Best development in Food,Energy & Environment andEnergy & Environment andMarine & Diesel.Marine & Diesel.
India, China and South East AsiaIndia, China and South East Asiashowed the strongest growthshowed the strongest growth..
October October –– December 2007, December 2007, at constant ratesat constant rates
+7+7
© Alfa Laval Slide 25 www.alfalaval.com
Orders received by RegionOrders received by Region
CentrCentr. & East 9%
. & East 9%
North America 16%
North America 16%
Asia 31%Asia 31%
L. America 6%
L. America 6%
Other 2%
Other 2%
Western EuropeWestern Europe26 %26 %
Nordic 10%
Nordic 10%
+51+51
+28+28
January January –– December 2007, December 2007, at constant ratesat constant rates
+15+15 +8+8
+19+19
+10+10
Interim Report Q4 2007Interim Report Q4 2007
Mr. Thomas Mr. Thomas ThuressonThuressonCFOCFOAlfa Laval GroupAlfa Laval Group
-- Orders received and marginsOrders received and margins-- HighlightsHighlights-- Development per segmentDevelopment per segment-- Geographical developmentGeographical development-- Financials Financials -- OutlookOutlook
© Alfa Laval Slide 27 www.alfalaval.com
HighlightsHighlights
Order intake Order intake Net salesNet sales
6,5766,5767,2207,220
SEK millionSEK million OctOct –– Dec 07Dec 07
© Alfa Laval Slide 28 www.alfalaval.com
Gross profit marginGross profit margin
20
30
40
50In percent of salesIn percent of sales
40.940.938.938.9
35.035.0
Q404Q404 Q105Q105 Q205Q205 Q305Q305 Q405Q405 Q106Q106
33.433.4
Q206Q206 Q306Q306 Q406Q406 Q107Q107 Q207Q207 Q307Q307 Q407Q407
© Alfa Laval Slide 29 www.alfalaval.com
HighlightsHighlights
Order intake Order intake Net salesNet salesAdjusted EBITAAdjusted EBITAAdjusted EBITAAdjusted EBITA--marginmarginProfit before taxProfit before tax
SEK millionSEK million OctOct –– Dec 07Dec 07
6,5766,5767,2207,2201,6751,675
23.2% 23.2% 1,5871,587
© Alfa Laval Slide 30 www.alfalaval.com
Earnings per shareEarnings per share
EarningsEarnings
Earnings, excluding stepEarnings, excluding step--upup
20072007
9.669.66
10.1510.15
20062006
4.344.34
4.894.89
Oct Oct –– DecDec20072007
28.4828.48
30.5530.55
20062006
15.1015.10
17.2317.23
Full yearFull year
© Alfa Laval Slide 31 www.alfalaval.com
Repurchase of sharesRepurchase of sharesMandate to repurchase 10 percent of the issued sharesMandate to repurchase 10 percent of the issued shares
Q4 07Q4 07
343,650343,6500.30.3132132
YTD 07YTD 07
3,602,5393,602,5393.23.2
1,4971,497
Number of repurchased sharesNumber of repurchased sharesPercentage of outstanding sharesPercentage of outstanding sharesDecrease of equity capital*Decrease of equity capital*
*In parent company and in the Group (SEK millions)*In parent company and in the Group (SEK millions)
© Alfa Laval Slide 32 www.alfalaval.com
HighlightsHighlights
Order intake Order intake Net salesNet salesAdjusted EBITAAdjusted EBITAAdjusted EBITAAdjusted EBITA--marginmarginProfit before taxProfit before taxCash flow from operating activitiesCash flow from operating activitiesROCEROCEROEROE
SEK millionSEK million OctOct –– Dec 07Dec 07
6,5766,5767,2207,2201,6751,675
23.2%23.2%1,5871,5871.2501.250
54.2%54.2%44.1%44.1%
© Alfa Laval Slide 33 www.alfalaval.com
Cash flows fromCash flows from-- operating activitiesoperating activities-- investing activitiesinvesting activities
Financial Financial netnet paidpaidDividendsDividends
TotalTotal
CashCash--flow statementflow statement
Pro Forma FreePro Forma Free--cashcash--flow*flow*
*Incl. operating activities, capital expenditure (excl. product *Incl. operating activities, capital expenditure (excl. product rights), provisions and financial net paidrights), provisions and financial net paid. .
SEK millionSEK millionJan Jan –– DecDec
20072007Jan Jan –– DecDec
20062006
3,2643,264-- 1,6761,676
-- 244244-- 715715
629629
2,4642,464
2,6192,619--1,5771,577-- 115115-- 599599
327327
2,1322,132
© Alfa Laval Slide 34 www.alfalaval.com
Foreign exchangeForeign exchange
SEK millionSEK million
Translation effectTranslation effectTransaction effectTransaction effect
TotalTotal
*Based on EUR/USD 1.45 and EUR/SEK 9.45 for open exposures*Based on EUR/USD 1.45 and EUR/SEK 9.45 for open exposures
Impact on adjusted EBITA from Impact on adjusted EBITA from FxFx. fluctuations. fluctuations
Q4 07Q4 07
-- 3737-- 77-- 4444
WY 08*WY 08*
00-- 140 140 -- 140140
WY 07WY 07
-- 147147-- 107107-- 254254
© Alfa Laval Slide 35 www.alfalaval.com
Order backlog as per December 31SEK millionsSEK millions
For For deliverydelivery duringduring nextnext yearyear
0
2000
4000
6000
8000
10000
12000
14000
16000
3,2983,298
11,432
14,73014,730
2,3442,344
10,015
12,35912,359
1,3681,368
6,129
7,4977,497
For For deliverydelivery later later thanthan nextnext yearyear
2007200720052005 20062006
Interim Report Q4 2007Interim Report Q4 2007
Mr. Lars RenstrMr. Lars RenströömmPresident and CEOPresident and CEOAlfa Laval GroupAlfa Laval Group
-- Orders received and operating margin Orders received and operating margin -- HighlightsHighlights-- Development per segmentDevelopment per segment-- Geographical developmentGeographical development-- Financials Financials -- OutlookOutlook
© Alfa Laval Slide 37 www.alfalaval.com
Outlook for the near futureOutlook for the near future
““Alfa Laval expects the demand to Alfa Laval expects the demand to remain on the current high level.remain on the current high level.””
© Alfa Laval Slide 38 www.alfalaval.com