· Q116 Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120 ... *...

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www.alfalaval.com23/04/2020 | © Alfa Laval 2 |

Report for Q1 2020Tom Erixon

President and CEO

Alfa Laval Group

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picture

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Key figures

23/04/2020 | © Alfa Laval 3 |

Q1 2020 Q1 2019 %-change %-▲,org*

Order intake 11,877 12,213 -3 -2

Net sales 10,590 10,158 4 5

Adjusted EBITA** 1,750 1,728 1

Adjusted EBITA-margin (%) 16.5 17.0

*) Organic growth excluding currency effects and structural changes. SEK 769 (-83) million of the order intake in the quarter is a result of revaluation of the backlog denominated in foreign currency.

**) Impact on EBITA of foreign exchange effects SEK 90 (95) million.

www.alfalaval.com

Orders received

23/04/2020 | © Alfa Laval 4 |

0

7 000

14 000

21 000

28 000

35 000

42 000

49 000

0

2 000

4 000

6 000

8 000

10 000

12 000

14 000

Q116 Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120

SEK million SEK million R 12

-3%

+2

2%

+1

4%

+1

4%

-22

%

= Order intake per quarter

= Order intake per quarter “large” = Rolling twelve months value

= % development by quarter, year on year+XX%

www.alfalaval.com

− Orders received excluding the “Marine Environmental”* business

Orders received

23/04/2020 | © Alfa Laval 5 |

0

7 000

14 000

21 000

28 000

35 000

42 000

49 000

0

2 000

4 000

6 000

8 000

10 000

12 000

14 000


SEK million SEK million R 12

+4

%

+8

%

+1

1%

-12

%

-21

%

= Order intake per quarter

= Order intake per quarter “ Marine Environmental”

”

= Rolling twelve months value, excluding “Marine Environmental”

= % development by quarter, year on year, excluding “Marine Environmental”+XX%

*) Alfa Laval PureSOx and Alfa Laval PureBallast.

www.alfalaval.com

− Order intake Q1, share and development

Service, by division

23/04/2020 | © Alfa Laval 6 |

ENERGY FOOD & WATER MARINE

Q120: 27%

Absolute development

YoY


YoY


YoY

+ +

Q120: 33% Q120: 27%

+

= Service share of total order intake

www.alfalaval.com

− January – March 2020 & development Q1-20 vs. Q1-19 at constant rates

Orders received by region

23/04/2020 | © Alfa Laval 7 |

17%;

North America

-37%

-5%

+33%

+9%

-24%

+18%

2%;

Africa & Oceania8%; Nordic

20%;

Western Europe

7%;

Central- & Eastern

Europe

42%; Asia

4%;

Latin America

+67%

January – March 2020 vs Q1 2019

www.alfalaval.com

− SEK million at prevailing rates

Top ten markets*

23/04/2020 | © Alfa Laval 8 |

0 1 000 2 000 3 000 4 000 5 000 6 000 7 000 8 000

France

Benelux

Japan

South East Asia

Mid Europe

Adriatic

Korea, South

Nordic

China

United States

*The order intake development of the 2019 top ten markets.= FY 2019

= LTM 2020

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− SEK millions and in percent of sales

Adjusted EBITA/margin*

23/04/2020 | © Alfa Laval 9 |

* Adjusted EBITA – ”Earnings before interests, taxes, amortization of goodwill and step up values and comparison distortion items.”

10,0

11,0

12,0

13,0

14,0

15,0

16,0

17,0

18,0

19,0

20,0

0

250

500

750

1 000

1 250

1 500

1 750

2 000

2 250

2 500

Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120

SEK million Percent of sales

16.517.016.9

15.7

www.alfalaval.com

− Highlights and comments

Energy division

23/04/2020 | © Alfa Laval 10 |

MARKETS & ORDER INTAKE

• Investment activity in the hydrocarbon chain

negatively impacted by current market turmoil.

• Demand in HVAC and refrigeration continued on a

high level with good growth in the quarter.

• Stable growth in Service.

PROFITABILITY (EBIT)

• Strong invoicing growth and a favorable load resulted

in an improved operating margin in the quarter.

Q1 20 Q1 19 YoY %-

change

Q4 19

ORDERS 3,197 3,448 -7.3 3,594

SALES 3,039 2,807 +8.3 3,961

EBIT 488 399 593

EBIT (%) 16.1 14.2 15.0

0

200

400

600

800

1 000

1 500

2 000

2 500

3 000

3 500

4 000


Sales EBIT

www.alfalaval.com


Food & Water division

23/04/2020 | © Alfa Laval 11 |


• Overall demand remained stable on a high level.

• Strong demand from customers in the dairy and

biotech segments.

• Service developed well in the quarter.


• The positive mix from a higher share of service could

not fully compensate for the lower invoicing and

lower load in some factories.

Q1 20 Q1 19 YoY %-

change

Q4 19

ORDERS 3,612 3,480 +3.8 3,720

SALES 3,118 3,153 -1.1 3,938

EBIT 498 524 664

EBIT (%) 16.0 16.6 16.9

0

200

400

600

800

1 000

1 500

2 000

2 500

3 000

3 500

4 000


Sales EBIT

www.alfalaval.com


Marine division

23/04/2020 | © Alfa Laval 12 |


• Demand in BU Pumping systems was solid both for

cargo pumping and offshore.

• Demand for PureBallast systems continued on a high

level, while the retrofit demand for PureSOx was

negatively impacted by the oil price development.

• Service continued to grow.


• Capital sales was affected by negative mix. FX driven

balance sheet revaluations had a negative effect on

profitability.

Q1 20 Q1 19 YoY %-

change

Q4 19

ORDERS 5,068 4,963 +2.1 3,840

SALES 4,433 3,932 +12.7 5,017

EBIT 708 761 985

EBIT (%) 16.0 19.4 19.6

0

200

400

600

800

1 000

1 200

1 400

2 000

2 500

3 000

3 500

4 000

4 500

5 000

5 500


Sales EBIT

Note) SEK 636 (-60) million of the order intake in the Marine Division in the quarter is a result of revaluation of the backlog denominated in foreign currency.

| www.alfalaval.com| © Alfa Laval

Report for Q1 2020 Jan Allde

CFO

Alfa Laval Group

www.alfalaval.com

− MSEK

Sales

23/04/2020 | © Alfa Laval 14 |

0

7 000

14 000

21 000

28 000

35 000

42 000

49 000

0

2 000

4 000

6 000

8 000

10 000

12 000

14 000

Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20

= Sales per quarter = Rolling 12-months value

= % development year on year+XX%

+4

%

+1

5%

+9

%

-1%

-10

%

10,590

SEK million R 12SEK million

www.alfalaval.com

− In percent of sales

Adjusted gross margin

23/04/2020 | © Alfa Laval 15 |

30

35

40

45

Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120

37.638.038.3

37.1

Q1 2019 38.0

Mix/price -

Load/volume =

PPV/metals +

FX -

Structure =

Q1 2020 37.6

www.alfalaval.com

− MSEK

Divisional sales and profitability

23/04/2020 | © Alfa Laval 16 |

ENERGY FOOD & WATER MARINE

Q1 2020 2019 2020 2019 2020 2019

Sales 3,039 2,807 3,118 3,153 4,433 3,932

Op. profit 488 399 498 524 708 761

Op. margin, % 16.1 14.2 16.0 16.6 16.0 19.4

• Volume and factory

loading (+)

• Mix impact (-)

• Cost (=)


loading (-)

• Mix impact (+)

• Cost (-)


loading (=)

• Mix impact (-)

• FX (~ -2%) • Revaluation (~50%)

• Dilution (~50%)

• Cost (-)

Op. Margin (%) comments

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− MSEK

Key figures

23/04/2020 | © Alfa Laval 17 |

Q1 2020 Q1 2019

Sales 10,590 10,158

Gross profit 3,763 3,604

Sales & Admin -1,670 -1,669

R&D -286 -260

Net other cost/income -291 -212

Operating income 1,528 1,471

Financial net -142 151

Profit before tax 1,386 1,622

Taxes -362 -397

EPS 2.43 2.90

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− MSEK

Cash-flow statement

23/04/2020 | © Alfa Laval 18 |

Q1 2020

Q1 2019

Cash flow from- operating activities- investing activities

959-83

975-494

Financial net paid -347 167

Total 529 648

Pro Forma Free cash-flow* 405 708

*Incl. operating activities, capital expenditure and financial net paid.

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− Estimated impact on adjusted EBITA from FX fluctuations, MSEK

Foreign exchange

23/04/2020 | © Alfa Laval 19 |

Q1 2020 FY 2020 FY 2021*

Transaction effect 60 530 380

Translation effect 30 20 -

Total 90 550 380

Projected FX-effect for 2020 communicated with Q4 report: SEK 380 million

Note: Excludes FX effects caused by revaluation of balance items in foreign currency.

*) Based on EUR/USD 1.118 and EUR/SEK 10.935

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− SEK billion

Order backlog as per March 31

23/04/2020 | © Alfa Laval 20 |

0

5

10

15

20

25


22.9

15

.57.4

25.7

16

.69

.1

book to bill1.20 0.860.88

= For delivery next year or later

= For delivery during the current year

0.89 1.12

www.alfalaval.com

− FY 2020, SEK billion

Sales

23/04/2020 | © Alfa Laval 21 |

Q1 Sales 10.6

Backlog, for delivery current year +15.5

Subtotal 26.1

Price

“In-for-out”*

FX translation

Acquisitions

Full year 2020

*IFO in Q2-Q4 2019 excluding acquisitions/divestments was SEK 20.0 bln.

For you to consider:

www.alfalaval.comwww.alfalaval.com23/04/2020 | © Alfa Laval 22 |

“We expect demand in the second quarter to be lower than in the first quarter.”

Outlook for the second quarter:

www.alfalaval.com

www.alfalaval.com

− Distribution of orders Q1 2020 (MSEK)

Activity split O&G, total

23/04/2020 | © Alfa Laval 24 |

Marine

Alfa Laval

Share of totalAlfa Laval

Energy

Drilling Processing &Transportation

PetrochemicalsRefinery

Grand total SEQ/YOY

960 (-/-)

735 (+/+)

=1,695*(-/-)

= 14.3%3.7% 3.3%1.6%5.7%

38

399

= 437

336

336

= 672

196

0

= 196

390

0

= 390

*) incl. aftermarket

(SEQ/YoY)

www.alfalaval.com

− Distribution of orders LTM, end of March

Marine Division’s industry split

23/04/2020 | © Alfa Laval 25 |

Share

Driver

Marine Offshore oil and gas

Engine power Service

World trade &

fleet capacity

Oil & gas demand

and prices

Electrical power

needs

World trade

Environment & Energy, Marine

Legislation &

fuel cost

30%

4%26%

7%

33%

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− Distribution of sales LTM end of March

Marine Division’s industry split

23/04/2020 | © Alfa Laval 26 |

Share

Driver

28%

Marine Offshore oil and gas

Engine power Service

4%

26%

World trade &

fleet capacity

Oil & gas demand

and prices

Electrical power

needs

World trade

Environment & Energy, Marine

35%

Legislation &

fuel cost

7%

www.alfalaval.com

− Compared with same quarter last year (%), excluding currency effects

Organic growth pace

23/04/2020 | © Alfa Laval 27 |

(30)

(20)

(10)

0

10

20

30

Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120

= Order intake growth

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Cautionary statement

23/04/2020 | © Alfa Laval 28 |

This presentation contains forward-looking statements that are based on the

current expectations of the management of Alfa Laval Group.

Although management believes that the expectations reflected in such forward-

looking statements are based on reasonable assumptions, no assurance can be

given that such expectations will prove to have been correct. Accordingly, results

could differ materially from those implied in the forward-looking statements as a

result of, among other factors, changes in economic, market and competitive

conditions, changes in the regulatory environment, other government actions and

fluctuations in exchange rates. Alfa Laval undertakes no obligation to publicly

update or revise these forward-looking statements, other than as required by law

or other regulations.

www.alfalaval.com

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