IMI Critical Engineering. Roy Twite Divisional Managing Director

Transcription

1 IMI Critical Engineering Roy Twite Divisional Managing Director 1

2 Behind the numbers 100 Value Engineering workshops held in the last 12 months 69m Orders H from Value Engineering 12 Plants consolidated or sold, 17 remaining 17m Invested in new ERP and CRM systems 12,000 Continuous improvement actions in New products already launched in

3 IMI Critical Engineering at-a-glance We help our customers control critical in-plant processes by providing superior, customengineered valves, actuation and control systems. Revenue split by geography 4% 51% 7% 16% 22% Western Europe North America Emerging Markets UK RoW Our performance in 2016 Our brands Our product categories Revenue 651m % of Group revenue 39% Operating profit 81.8m Number of employees 3,700 Order intake m Aftermarket 299m Power 94m Oil & Gas 135m Petrochemical 45m Nuclear Power 10m Other 31m Control valves Butterfly valves Actuation Ball valves Slide valves FCC valves 3

4 Leading the market Supporting the customer Successful adoption of Value Engineering tools Realignment of global footprint New Product Development Impact of future energy mix on New Construction orders Gas is the most important transition fuel Growth in LNG demand Nuclear outlook remains attractive Installed base delivering high quality profits stream 4

5 Delivering against IMI Group strategy Year 0: The hard work begins Year 1: Increased investment Year 2: Benefits starting to show Year 3: Nearly firing on all cylinders Year 4: Up to full speed Ambition: Double operating profits IMI Critical Engineering Deliverables Houston facility IMI STI relocation Quarter turn actuators Oil & Gas ball valves Korea localisation IMI Bopp & Reuther Website & Intranet Obeya & Project Management Process Branding and website ERP implemented in 6 sites CRM blue-print designed Organisational Upgrade Consolidated Nuclear manufacturing in IMI Bopp & Reuther Internal Control Declaration 73% Launch 15 new products IMI Th Jansen manufacturing consolidated into IMI Z&J China sites consolidated Implement VA/VE and competitor strip down Launch 10 new products Sales acceleration China localisation Implement dedicated Middle East business unit. Internal Control Declaration 75% ERP implemented in 9 sites CRM implemented in 40% of the Division Launch 10 new products Lean score at 85% Internal Control Declaration 78% Bolt-on acquisition ERP implemented in 80% of the division CRM implemented in 80% of the Division Bolt-on acquisition Launch 10 new products CRM and ERP implementations complete Internal Control Declaration 80% Supported by value enhancing acquisitions 5

6 Footprint for growth 6

7 IMI Critical Engineering footprint for growth People footprint from 2013 to 2017: Increased by 15% in the East Decreased by 16% in the West Consolidated or sold 12 plants Before Now 7

8 IMI Critical Engineering footprint for growth IMI CCI Korea: 80% Lean Score IMI CCI SriCity: 71% Lean Score IMI Critical Engineering China: 70% Lean Score 8

9 ERP programme 19m capex approved 8 sites live, 8 to go Austria Improved financial control Faster management decision making Driving overhead efficiencies Malaysia IFS Korea India Singapore Japan Sweden Czech Republic 9

10 CRM programme 3m capex approved 40% of revenue this year, 80% by 2018, 100% by 2019 Supporting top line growth Enabling global project capture Proactively serving our global installed base 10

11 Energy transition 11

12 energy demand forecast Future energy growth from South-East Asia, Middle East and India (Source IEA World Energy Outlook) Energy Demand by Region in the New Policies Scenario Middle East 2.2% China 0.9% India 3.3% Southeast Asia 2.2% 12

13 Gas power growth Energy Demand (Mtoe) World Primary Energy Demand (CAGR) by Fuel in the New Policies Scenario Oil: 0.4% Gas: 1.5% Coal: 0.2% Renewables: 2.3% Nuclear: 2.3% Coal Oil Gas Nuclear Renewables (Source: Based on IEA data from World Energy Outlook OECD/IEA 2016, Licence: as modified by IMI) 13

14 LNG demand LNG demand to grow at 4% - 5% annually between 2015 and 2030 (Source: Shell LNG Outlook 2017) Capacity additions need to come on line by 2024 to meet demand IMI orders possible in 2019 / 2020 (Source: BP Energy Outlook 2017) 14

15 Nuclear new construction Top Nuclear New Construction Projects Under Construction Planned 35 Number of Reactors China Russia India UAE Korea UK 15

16 IMI Critical Engineering New Construction 2016 New Construction orders: 9% Gas Power 9% LNG 2% Nuclear Bookings ( m) New Construction Orders By Destination Region in Emerging Markets Middle East & Africa North America Western Europe LNG 9% Other 11% New Construction Orders in 2016 Nuclear 2% Gas Power 9% Other Power 6% Petrochemical 14% Other Oil & Gas 34% Coal Power 15% Other includes Biomass, CSP, CHP for Oil and Gas 16

17 IMI Critical Engineering Aftermarket 2016 Aftermarket orders: 16% Gas Power 5% LNG 15% Nuclear 120 Aftermarket Orders By Destination Region in 2016 Aftermarket Orders in 2016 Coal Power 18% LNG 5% Petrochemical 8% Other Power 10% Bookings ( m) Emerging Markets North America Other includes Biomass, CSP, CHP for Oil and Gas Western Europe Middle East & Africa Other 16% Gas Power 16% Nuclear 15% Other Oil & Gas 12% 17

18 IMI Critical Engineering footprint Control valves installed base 750,000 valves in the installed base c. 300m in aftermarket revenue 18

19 Are we ready for the 2040 electric vehicle target? British energy capacity Current electricity usage at peak times 61GW per year To produce the extra 30GW per year we would need to build an extra: 10,000 New wind turbines Build time 6 months per wind turbine Costing 1.3 million per wind turbine or 9.6 Hinkley nuclear power station Build time 20 years per nuclear plant Costing 20 billion for each nuclear power station Extra energy needed to power electric cars by GW per year The electric driving revolution Electric vehicle uptake Vehicles (millions) How key electric cars compare Tesla Model S Top of the range Nissan Leaf Best seller Electricity generation sources Generation (Terawatt-hour) Source: The Telegraph 25 th Jul 2017 Range Range miles miles Charge time 9 hours Charge time hours Cost 126,900 Cost 16,680 19

20 Electricity generation sources Generation (Terawatt-hour) 20

21 Are we ready for the 2040 electric vehicle target? China gears up to ban diesel and petrol cars in coming decades Aim to implement before the UK Ford estimate demand would be 6m electric vehicles per year by

22 Leading the market Supporting the customer Successful adoption of Value Engineering tools Realignment of global footprint New Product Development Impact of future energy mix on New Construction orders Gas is the most important transition fuel Growth in LNG demand Nuclear outlook remains attractive Installed base delivering high quality profits stream 22

23 Disclaimer This document may contain forward-looking statements that may or may not prove accurate. For example, statements regarding expected revenue growth and operating margins, market trends and our product pipeline are forward-looking statements. It is believed that the expectations reflected in these statements are reasonable but they may be affected by a number of risks and uncertainties that are inherent in any forward-looking statement which could cause actual results to differ materially from those currently anticipated. Any forward-looking statement is made in good faith and based on information available to IMI plc as of the date of the statement. All written or oral forward-looking statements attributable to IMI plc are qualified by this caution. IMI plc does not undertake any obligation to update or revise any forward-looking statement to reflect any change in circumstances or in IMI plc s expectations.