Business objectives. Capitalize on strong markets. Growing services/adjacencies. Operating excellence lean. Creating business synergies

Transcription

1 GE Infrastructure GE Infrastructure Environment Business objectives Aviation industry strong traffic Capitalize on strong markets Energy riding international strength Oil & Gas fuel price, capex Transportation int l & mining Invest/win with great technology Globalize emerging markets Growing services/adjacencies Operating excellence lean Water Demand everywhere Creating business synergies Great markets GE advantages strong financials 2

2 Great markets O&G Visible opportunities Opportunity geography Key opportunities Asia N. America 19% 10% Latin America ~$14B Middle East opportunities Saudi: $200B spend, up and downstream India: $60B plan in oil & gas projects 15% 34% 22% Europe ~$15B Americas opportunities NA: focus on drilling and downstream Brazil: Petrobras to spend $87B MEA + India ~$11B European opportunities North sea: strong sub-sea activity Russia: Artic LNG and new gas pipelines ~$50B+ visible opportunities 3 Great markets Transportation global growth Age of fleet (years) Global (locos) Approx. Fleet Size N. Am China Russia/CIS India L. Am 27,700 11,400 13,600 4,900 3,600 RR s critical in developing countries Coal & commodity growth Freight corridors, land bridges & mining Emphasis on reliability, life cycle, & emissions Global expansion driven by emerging mkts, commodities growth e Key Wins: Kaz/Russia/CIS (Loco s, Mods, OHV) $1.0B+ China (Locos, Signaling, OHV, O&G, M&S) $800MM+ Middle East/Africa (Loco s, M&S, Parts) $350MM+ SEA/ANZ (Loco s, M&S) $130MM Europe (Loco s, Mods, Signaling, M&S) $150MM+ S. America (Loco s, OH s) $100MM Targets: MEA (Loco s, Mods, Signaling, MSA) $1.5B+ S. America (Loco s, Signaling, MSA) $1.0B+ Europe/Russia/CIS (Loco s, Mods, Signaling, MSA) $1.0B+ China/SEA/ANZ (Loco s, Mods, Signaling, MSA) $1.0B+ 4

3 Great markets unprecedented water challenges Increasing water scarcity Threat of waterborne illness Developing growth Rising energy costs New regulations Infrastructure demands 5 Partner with GE Energy GE s investments 30+ operating locations Gas, coal & wind generation Creating value Win where others don t see value GE Energy support in due diligence Improve EBITDA of investments efficiencies, expansions, O&M optimization, NPI Identify under-valued opportunities early Linden, NJ: expansion & efficiency Variable frequency transformer, Linden 7 upgrade Capacity / Heat rate improvements Contract restructuring +$20MM annual operating improvements +$100MM asset value increase 6

4 GE advantage adjacency growth in Wind Sales ($ in billions) $2.3 $3.5 $4.3 ~25% ~20% Drivers Clear product strategy technology differentiation Price > inflation Operational rigor global supply chain/logistics Beyond 08 '05 '06 '07E '08E 09E ROTC % U ~50 F 2.5 MW platform Services execution 7 GE advantage Commercial Engines Commercial engines Commercial installed base Best-selling on regionals 800 engine Best-selling on singleaisle 4,500 engine 21,900 CFM Best-selling on Boeing engine Best-selling on widebodies 2,250 engine 12,600 4,600 14,600 8,200 4, F GE EA Fleet in active commercial service Source: ACAS, GE internal studies GP7000 developed by GE/P&W Engine Alliance CFM is a 50/50 joint company between GE and Snecma 8

5 Strong financials Energy business evolution GT Wind Nuclear Gasification Gas engines Invest + deliver GE business model + ESBWR launch GE ref plant + GE global footprint Engineering commitment 5, % ~7,600 Environmental Emissions operating efficiency T+D Controls Reinvestment & grid intelligence Bently operational excellence 05 07E Solar Differentiate with IP business model / value prop 9 Strong financials lean capacity at Aviation CFM56 Turbine Blade Cycle Time () Single piece flow lines 42 Quick change tooling 29 Robotics '06 '07 YTD GE90 Assembly and Test Cycle Time () Material kitting Standard blocks of work 19 Automated test setup '05 '06 '07 YTD 10

6 Strong financials expanding Transportation margins Lean to build capacity Components Assembly Sub-assemblies Paint Test Transportation CM% EVO Cost-Out Launch 11% reduction 2007e Reliability Failures / Loco Year (F/LY) +6 pts e Remanufacturing D-9 AC % reduction AC6000 EVO '05 EVO '06 ~10,000 loco s under Service ~$12B+ Reman parts 30-40% less cost w/no adverse impact to performance $500MM+ life-cycle-cost oppt y 11 Infrastructure: investor perspective Great Markets should be for a long time Three macro tailwinds oil/gas, environmental, energy demand 2B+ people need what we sell Unique GE advantage horizontal leverage Technical breadth and execution Resources to invest in next-gen technologies and adjacencies Strong financials many products, many markets (vs. power bubble) Services mix should improve Supply chain excellence 40% of GE in great shape 12

7 GE Infrastructure