Agenda. Welcome and introductions. What is Severe Service? About IMI Severe Service. Market and competitive landscape.

Transcription

1 IMI Severe Service

2 Agenda Welcome and introductions What is Severe Service? About IMI Severe Service Market and competitive landscape Growth strategy

3 Personal introduction Appointed as President on August 1st, 2005 Previously 12 years with Novar plc; most recently as President of Novar s Americas region Wide experience in managing industrial systems businesses Professional engineer (Imperial College) with MBA (Harvard)

4 What is Severe Service?

5 Severe Service: Control Control of steam flow through a turbine in a power station Control of gas flow through a gas processing plant

6 Severe Service: Isolation Emergency shutdown of gas flow into a LNG plant Shut-off of gas flow in a high integrity pressure protection system (HIPPS)

7 Severe Service: Characteristics Cost of failure is many times the cost of the solution High pressure drop High velocity flow control Extreme temperatures/cryogenics Fine control requirements Tight shut-off Corrosive/erosive environments Nuclear applications Operational reliability Safety critical/emergency shutdown An engineered solution incorporating high levels of performance and reliability

8 Severe Service putting it in context Average house tap Pressure: 50 psi Hoover Dam 300 psi Severe Service control valve Up to 15,000 psi

9 Severe Service Top of the Pyramid Severe Service Applications and Technologies ~$3bn General Service Applications and ~$22bn Technologies Source: McIlvaine, PMSI, ARC, IMI estimates Oil/Gas, Power and Petrochem only excludes Service

10 Severe Service Not all Severe Service valves are the same Cavitation Erosion Photographs of competitors products

11 About IMI Severe Service

12 IMI Severe Service today Leader in severe service solutions Serving major customers in the global energy and power markets Over 2,000 dedicated employees worldwide Global manufacturing, sales and support capability Emerging market focus Unrivalled reputation for aftermarket support Experienced and talented management team Heroically, customer focused culture Strong growth orientation with potential for strategic development

13 IMI Severe Service 2006 segmentation Industry Service 29% Fossil power 20% Geography Asia-Pacific 36% Americas 21% Industrial/other 14% Oil & gas 20% Nuclear power 17% EMEA 43%

14 IMI Severe Service Our journey 1971 B&W acquires CCI 1981 IMI acquires CCI 1997 Sulzer valves 2002 STI 2003 Fluid Kinetics and Herion Valves 2006 Truflo IMI Severe Service 1961 Founded Bailey Valves CCI Patents the DRAG valve 1992 Dikkers nuclear valves 2001 BTG valves 2005 ABB Japan Control Valves; 100% of CCI Korea; Shanghai CCI JV formed

15 Foundations of our success Committed people everywhere

16 Foundations of our success Direct relationship with the market OEM EPC Client Partner Customer End User Oil & Gas Power Integration Price, eng support, project execution Life cycle op cost, service

17 Foundations of our success The Valve Doctor CCI Valve Doctors Our best engineering talent Strong application knowledge Great, personal customer relationships Keep us ahead of the game in terms of innovation and technology Focus on results for the end-user Plant Betterment Our most experienced valve engineers: 40 Valve Doctors 9 countries >600 years combined experience

18 Foundations of our success Proven technology Track record of solving severe service problems in over 4,500 plants worldwide Recognised as leader in custom engineered solutions Focus on engineering leadership and innovation

19 Foundations of our success Global service and operations capability

20 Market and competitive landscape

21 IMI Severe Service: Oil & gas Billion US$ Source: BP, EIA Oil majors are investing record CAPEX in exploration and production to sustain the demand for energy and supported by high oil prices 2007 CAPEX expenditure will exceed $280 + billion dollars CAPEX is a leading indicator for IMI Severe Service, but that is not the whole story

22 IMI Severe Service: Oil and gas Focused on upstream gas production and midstream LNG/GTL chain

23 IMI Severe Service: Oil and gas Bn m 3 /year 5,000 Gas production $bn 35 Global LNG Capex 4, , , , Source: Douglas Westwood Source: Douglas Westwood Gas production projected to grow; primarily driven by demand for electricity generation Mid-term, greater proportion of gas will be transported by LNG for geo-political reasons Longer term clean coal processes and nuclear will impact demand for LNG, especially from US and China

24 IMI Severe Service: Fossil and nuclear power Gigawatts 5,000 4,000 3,000 2,000 1,000 0 Global fossil-powered electricity generating capacity Source: EIA Russia India China Bulgaria Taiw an Ukraine Argentina Finland Iran Japan Korea Pakistan Romania Nuclear reactors under construction (April 18th, 2007) Source: IAEA Fossil generating capacity projected to grow steadily; driven by energy demand in China and India Environmental considerations will come to the fore, driving investment in clean coal and CO 2 capture with re-injection 31 nuclear plants under construction currently as part of upgrade and expansion of 443 units operating today

25 IMI Severe Service: Competitive landscape #1 or #2 in markets we serve Severe Service: Control Power Oil and Gas Severe Service: Isolation Power/O&G* Nuclear * Tri-X technology

26 Growth strategy

27 Growth Strategy: Severe Service Solutions Several avenues for organic and strategic growth Leverage existing products, markets and services Emerging market focus Increase application scope with new products and technologies Enter new application areas, eg subsea, downstream Severe Service Solutions

28 Growth Strategy: Severe Service Solutions From product provider to system integrator Severe Service Solutions Valves Actuation Control Increasing end-user influence

29 Growth Strategy: Execution Business Development Leveraging existing markets HIPPS systems Emerging markets focus Acquisition of Truflo Process Excellence Global supply chain Low cost procurement New facility in India Support center in India Innovation Dedicated R&D group New chokes and actuation Organisation Capability Regional leadership Leverage future acquisitions World class leadership team

30 IMI Severe Service In summary Excellent IMI platform business Positioned for profitable growth Exposure to buoyant, global energy markets Direct relationship with the partners, customers and end-users Significant recurring aftermarket and service revenues Strategic development potential High proprietary, engineering content Experienced, committed and talented team Delivering on our commitments; developing the business

31 Focus presentations Oil & gas room Oil & gas LNG (Orton) Power room Nuclear Fossil power Technology room Technology / Innovation Customer Service