Nasdaq: FWLT. Presented by: Ankit Chadha, Ellen Yang, Ken Chen & Nicu-Mihai Achihaei

Transcription

1 Nasdaq: FWLT Presented by: Ankit Chadha, Ellen Yang, Ken Chen & Nicu-Mihai Achihaei

2 Introduction Investment Thesis Company Breakdown Catalysts/Key Drivers Competitors Risks Valuation Question and Answer Agenda

3 Company History Formed in 1927 out of Power Specialty Company and Wheeler Condenser & Engineering Company Incorporated in Canton of Zug, Switzerland of as 2008 Headquartered in Clinton, New Jersey

4 Business Overview Global engineering and construction contractor and power equipment supplier Operates through two segments Global Engineering and Construction (E&C) Global Power Group (GPG)

5 Investment Thesis Proprietary technology Expansion into emerging markets (by geography and sector) Hedged against rising input prices

6 Global E&C Designs and constructs leading-edge processing facilities Industries serviced include oil refining, power generation, chemical/petrochemical, and pharmaceuticals Services include Consulting Design and Engineering Project management and control Procurement Construction/Commissioning and Start-up Operations and Maintenance

7 Example E&C Project Power generation upgrade ESSO Sriracha Refinery, Thailand

8 What is Flow-Through? Two primary types of contracts: Cost-Reimbursable Contracts Fixed-Rate Contracts Specialized Fixed-Rate Contract: Lump-sum Turnkey

9 Flow-Through s Impact on Top Line 8,000 7,000 6,000 5,000 4,000 3,000 Flow-Through Scope Revenue 2,000 1, E 2010E 2011E

10 % of E&C Contracts by Type 17% Reimbursable Fixed-Rate 83%

11 Delayed Coking FWLT licenses Selective Yield Delayed Coking (SYDEC) to customers One of the leading technologies in refinery residue upgrading

12 Global Power Group Offers full range of steam generator equipment, aftermarket products, and services to the power, industrial, and waste-to-energy sectors Leader in carbon reduction and fuel-flexible combustion technology and the development of solutions to address carbon reduction

13 % of GPG Contracts by Type 15% 32% 53% Fixed-Rate LSTK Reimbursable

14 Products and Services Circulating Fluid-Bed Steam Generators (CFB) Pulverized Coal (PC) Steam Generator Industrial Steam Generators Auxiliary Equipment and Aftermarket Services CFB for Lagisza, Poland Project

15 Revolutionary New Advances

16 What are the Advantages? Circulating Fluid-Bed (CFB) steam generator with Flexi-Burn technology Benefits Low emissions Fuel flexibility

17 Revenue Generation Sales, installation, and servicing of generators Maintains two noncontrolling equity interests Waste-to-energy project and wind farm project in Italy Refinery/electric power generation project in Chile

18 Global E&C and GPG Representative Clients State-owned and multinational oil and gas companies Major petrochemical, chemical, and pharmaceutical companies National and independent electric power generation companies Government agencies

19 Operating Revenue by Industry (2008) Environmental 0% Other (net) 0% Oil Refining 23% Chemical/Petroche mical 22% Power Generation 24% Oil and Gas 28% Power Plant Operation and Maintenance 2% Pharmaceutical 1%

20 Catalysts and Key Drivers - Global E&C Unique Technologies Strengthening Macro-economic conditions Timing of Client Investment Long Term Energy Demand Bio Kinetics Inc. (Feb 2008)

21 Catalysts and Key Drivers GPG New Technologies Environmentally Friendly Power Plant Price Inflation Entry into New Geographic Markets

22 Recent Contracts 10/13/09: Saudi Arabia: Expansion of an industrial wastewater treatment plant 7/23/09: Australia: Power generation and water treatment facilities 4/1/09: India 20 year agreement with BGR Boilers Limited Pulverized coal steam generators to be sold in India Multiple contracts within next five years.

23 Current Backlog Australasia 6% Americas 18% Global E&C Scope Asia 43% Global Power Scope South America 11% Asia 7% Middle East 11% North America 33% Europe 44% Europe 22% Middle East 5%

24 Competitive Landscape Profitability 13 weeks ending FWLT Fluor Jacobs Industries Gross Profit Margin 16.8% 6.0% 13.7% Pre-tax Profit Margin 11.8% 5.3% 5.5% Net Profit Margin 9.3% 3.2% 3.5% Return on Equity 22.2% 5.8% 3.7% Return on Assets 4.1% 2.5% 2.2% Valuation FY 10 Price to Sales Price to Earnings Price to Book Price to Cash Flow

25 Fixed Price Contracts Cyclical Greenhouse Copenhagen Conference Dec 2009 ForEx Asbestos Claims Risks

26 Wrap-up

27 Q&A

28 Appendix Slides: Asbestos

29 Appendix Slides: Asbestos

30 Appendix Slides: Asbestos