flsmidth @ seb enskildanordic seminar prologue 2013

FLSmidth @ SEB Enskilda Nordic Seminar Prologue 2013

SEB Enskilda Nordic Seminar Prologue 17 January 2013

Jørgen Huno Rasmussen, CEO - Copenhagen, 7 January 2013

Forward-looking statements

Disclaimer

7 January 2013SEB Enskilda Nordic Seminar Prologue 2

FLSmidth & Co. A/S’ financial reports, whether in the form of annual reports or interim reports, filed with the Danish Business Authority and/or announced via the company’s website and/or NASDAQ OMX Copenhagen, as well as any presentations based on such financial reports, and any other written information released, or oral statements made, to the public based on this interim report or in the future on behalf of FLSmidth & Co. A/S, may contain forward-looking statements.

Words such as ‘believe’, ‘expect’, ‘may’, ‘will’, ‘plan’, ‘strategy’, ‘prospect’, ‘foresee’, ‘estimate’, ‘project’, ‘anticipate’, ‘can’, ‘intend’, ‘target’ and other words and terms of similar meaning in connection with any discussion of future operating or financial performance identify forward-looking statements.Examples of such forward-looking statements include, but are not limited to:• statements of plans, objectives or goals for future operations, including those related to FLSmidth & Co. A/S markets, products, product research and product

development• statements containing projections of or targets for revenues, profit (or loss), capital expenditures, dividends, capital structure or other net financial items• statements regarding future economic performance, future actions and outcome of contingencies such as legal proceedings and statements regarding the underlying

assumptions or relating to such statements• statements regarding potential merger & acquisition activities. These forward-looking statements are based on current plans, estimates and projections. By their very

nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, which may be outside FLSmidth & Co. A/S’s influence, and which could materially affect such forward-looking statements.

FLSmidth & Co. A/S cautions that a number of important factors, including those described in this presentation, could cause actual results to differ materially from those contemplated in any forward-looking statements.

Factors that may affect future results include, but are not limited to, global as well as local political and economic conditions, including interest rate and exchange rate fluctuations, delays or faults in project execution, fluctuations in raw material prices, delays in research and/or development of new products or service concepts,interruptions of supplies and production, unexpected breach or termination of contracts, market-driven price reductions for FLSmidth & Co. A/S’ products and/or services, introduction of competing products, reliance on information technology, FLSmidth & Co. A/S’ ability to successfully market current and new products, exposure to product liability and legal proceedings and investigations, changes in legislation or regulation and interpretation thereof, intellectual property protection, perceived or actual failure to adhere to ethical marketing practices, investments in and divestitures of domestic and foreign enterprises, unexpected growth in costsand expenses, failure to recruit and retain the right employees and failure to maintain a culture of compliance.Unless required by law FLSmidth & Co. A/S is under no duty and undertakes no obligation to update or revise any forward-looking statement after the distribution of this presentation.

A leading supplier of equipment and services to the global minerals and cement industries

Revenue EUR ~3bn in 2011, of which 69% was generated in developing countries

Listed on NASDAQOMX Copenhagen, Denmark

Among the 5-10 most traded shares in CopenhagenCurrent Market Cap EUR ~2.2bn >40% foreign shareholders98% free-float

FLSmidth in brief

FLSmidth in brief


A strong competitive positionUnmatched scope of technology, equipment and expertise within cement, mineral processing and material handling

Unique ability to meet the full range of customer requirements, from complete plants to spare parts and full O&M services

Excellent track record of reliability, time to market and project follow-through

Proven ability to help customers increase capacity, reduce operating costs and lower environmental impact

Local presence in more than 50 countries

In-country resources and substantial presence in India

FLSmidth in brief

FLSmidth in brief


Engineering house and technology provider

Flexible cost structure (mostly engineering and project management)

Most manufacturing is outsourced (~80-90%)

Relatively low working capital due to prepayments from customers (typically 10-25% of total contract amount upfront)

Low maintenance CAPEX

Order related engineering off-shored to India

Increased sourcing from cost-competitive-countries (~40% at present; target is 75%)

Asset light business model

FLSmidth in brief


August 2002: Launch of Focus Strategy: Focus on core competencies (non-core divested in 2005) √

Grow Minerals to same size as Cement (happened in 2010) √

Grow the Service business continuously (has grown from DKK ~1bn in 2001 to DKK ~7bn in 2011) √

February 2012: Launch of Growth Strategy: We will be our customers’ preferred full-service provider of sustainable minerals and cement technologies

We will focus on 6 key industries: Copper, Gold, Coal, Iron ore, Fertilizer and Cement

We will offer customers in our six key industries full flow sheet solutions that reflect our core competences

Our primary value-proposition will be based on a holistic life-cycle approach, lower total cost of ownership and more sustainable and eco-efficient technologies

2012: Has been a year of transformation and expansion

2013: Main focus will be on execution and consolidation

Strategic roadmap

FLSmidth in Brief


Long history of strategic acquisitions- contributing to FLSmidth’s growth and success

FLSmidth in brief

SEB Enskilda Nordic Seminar Prologue 7

1926 1959 1990 19971914 2012

Key historical milestones …FLSmidth (Denmark) starts to supply equipment and services to the minerals industry

Fuller Company is established in Catasauqua, PA, USA

Traylor Engineering & Manufacturing Company is acquired by Fuller Company (Established 1902)

FLSmidth acquires Fuller Company

FLSmidth forms a separate minerals company, FFE Minerals

2007

FFE Minerals changes name to FLSmidth Minerals Acquisition of GL&V transformed minerals to a single source solution supplier

20001995 2010 201120092008

7 January 2013

http://www.pfaff-aqs.de/index.php?deutsch_home

http://www.glv.com/Corporate.aspx?idMenu1=1&id=1251

http://www.transweigh-india.com/index.html

Group Structure

Group Structure (February 2012)


MineralsCement*

FLSmidth

Old structure

Customer Services

Material Handling*

Mineral Processing** Cement

FLSmidth

Projects and Products

Projects and Products

New structure

*) Renamed Material Handling on 1 December 2012 (previously Bulk Materials)**) Renamed Mineral Processing on 1 December 2012 (previously Non-Ferrous)

7 January 2013

Divisions renamed

Divisions renamed


Effective 1 December 2012 the two divisions previously known as Non-Ferrous and Bulk Materials have been renamed to reflect the underlying technology focus in each of the two divisions

Non-Ferrous is now “Mineral Processing”

Bulk Materials is now “Material Handling”

Continued strong growth in revenue and order intake

Ludowici acquisition completed in Q3

Continued execution challenges inMaterial Handling

Revenue guidance maintained at DKK 25-26bn (excl. Cembrit)EBITA margin guidance clarified at 10%


Order intake up 11% on Q3’11, and also up 9% sequentially

Revenue up 23% due to positive developments in all segments, particularly in Mineral Processing and Customer Services

EBITA unchanged, reflecting a decrease in the EBITA margin

EBIT down 6%, adversely impacted by effects of purchase price allocations amounting to DKK -88m in Q3 (Q3’11: DKK -45m)

Excluding acquisitions, the number of employees increased 12%, most of which is related to O&M contracts

Financial developments in Q3 2012

Q3 Results 2012

7 January 2013 11

FLSmidth & Co. A/S(DKKm) Q3 2012 Q3 2011 Change

Order intake 7,956 7,176 +11%Order backlog 31,766 27,492 +16%Revenue 6,316 5,131 +23%Gross margin 25.6% 26.3%EBITA 628 628 0%EBITA margin 9.9% 12.2%EBIT 528 562 -6%EBIT margin 8.4% 11.0%Net results1) 377 403 -6%CFFO -28 563 n/aEmployees2) 14,740 11,628 +27%

SEB Enskilda Nordic Seminar Prologue

1) Including Cembrit2) Excluding Cembrit

Service accounts for ~40% of overall business

41%

20%

31%

8%

Interim Report Q3 2012


Order intake Q3 2012– classified by segment

Customer Services

Material Handling

Cement

39%

61%

Capital Business

Order intake & Revenue Q1-Q3 2012 – classified by Service and Capital business

Service Business

Mineral Processing

7 January 2013

28%

28%14%

6%

3%

7%

14%


Distribution of order intake by industry


Order intake Q1-Q3 2012 – classified by industry

Cement

Copper

Gold

Coal

Iron ore

Fertilizers

Other Announced orders in Q4 2012

Copper Kazakhstan DKK 380m (MP)Cement Russia DKK 200m (C)Copper Chile DKK 1.1bn (CS)Gold Russia DKK 200m (MP)

Total DKK 1,880m

... copper, cement and gold continue to be most important industries

7 January 2013

Unannounced orders record high DKK 5.9bn in Q3

Stable level of announced orders (orders > DKK 200m, announced when they become effective)

Contribution margin of 2012 order intake has increased the average margin of the order backlog

Order intake increased 11% in Q3 2012



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Order intake (quarterly)+11% vs. Q3 2011DKKm

Announced O&M ordersAnnounced Capital ordersUnannounced orders

Announced orders in Q3 2012

Cement Egypt DKK >1.1bn (CS)Copper South America DKK 655m (MP)Aluminium Venezuela DKK 280m (CS)

Total DKK >2,035m

7 January 2013

High visibility >1.3 years revenue in the backlog

We always know what to do the next 6-9 months

O&M order backlog DKK 4.5bn at the end of Q3’12 (~14% of total order backlog)

Order backlog provides high visibility into 2013



Expected conversion of Q3’12 backlog to revenue:

Q4 2012: 25%

2013: 46%

2014: 15%

2015+: 14% 0.901.001.101.201.301.401.501.60

05,000

10,00015,00020,00025,00030,00035,000

Q3 2010

Q4 2010

Q1 2011

Q2 2011

Q3 2011

Q4 2011

Q1 2012

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Q3 2012

Order backlog (quarterly)+15% vs. Q3 2011DKKm Book-to-bill ratio*

*) Order backlog divided by Trailing-Twelve-Months Revenue

7 January 2013

Organic growth +16% (excl. currency impact and acquisitions)

Pattern of increasing quarterly revenue over the calendar year expected to be repeated in 2012

EBITA margin challenged by execution problems in Material Handling and increasing SG&A ratio

Revenue increased 23% in Q3 2012



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Revenue (quarterly)+23% vs. Q3 2011DKKm EBITA margin

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Tight focus on SG&A developments



SG&A ratio up 1.2 %-points compared to Q3’11

Increase in SG&A vs. last year partly due to: Acquisitions (DKK ~108m in Q3 2012)

Currency effects (DKK ~75m in Q1-Q3 2012)

High tender activity leading to increasing proposal costs- adding to costs now and revenue later

Additionally, SG&A included costs of non-recurringnature amounting to DKK ~100m in Q3 2012:

Implementation of new strategy and organizationBusiness alignment related to roll out of global ERP business systemTransaction and integration costs in connection with acquisitions

Cost efficiency program initiated

SG&A ratio

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SG&A (quarterly)+34% vs. Q3 2011DKKm

CFFO adversely impacted by increase in working capital of DKK 813m in Q3

CFFI amounted to DKK -2,421m in Q3 primarily related to the acquisition of Ludowici, Decanter, Inc. and Teutrine and MIE Enterprises.

Temporary slow down in acquisitions except for smaller bolt-on in coming quarters

Cash flow from operating and investing activities



CFFO (quarterly)DKKm

-600-400-200

0200400600

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Q4 2010

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Q3 2011

Q4 2011

Q1 2012

Q2 2012

Q3 2012

CFFI (quarterly)-186% vs. Q3 2011DKKm

-3,000-2,400-1,800-1,200

-6000

600

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Q3 2012

Tight focus on working capital developments



Working capital* (quarterly)+447% vs. Q3 2011DKKm

Working capital increased 3.1 %-points of sales to 10.8% in Q3

Structural reasons for increase in working capital:Strategic initiatives in Customer Services

Change in business mix towards more Customer Services, more products and mining projects and less cement projects

Specific reasons for increase in working capital in Q3:

Acquired entities in Q3 2012 contributed with DKK 525m to Group working capital

Working capital program initiated, including:Monthly reporting, monitoring and follow-up on KPIs

Systematic NWC responsibility in the global organisation

Specific initiatives launched in relation to accounts receivables, account payables, inventories, etc.

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WC /TTM* Sales

*) Working capital excluding Cembrit

*) TTM : Trailing-Twelve-Months excluding Cembrit

Net debt increased in Q3 primarily due to acquisition of Ludowici

Equity ratio declined to 29% due to increased balance sheet total, primarily attributable to acquisitions and in particular Ludowici. An equity ratio below 30% is expected to be of temporary nature

Capital structure



NIBD* (quarterly)DKKm

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Equity (quarterly)DKKm Equity ratio

-0.8-0.400.40.81.21.6

-2,000-1,000

01,0002,0003,0004,000

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Gearing (NIBD/ TTM* EBITDA)

Gearing 1.4x EBITDA +14% vs. Q3 2011

*) NIBD excluding Cembrit

*) TTM: Trailing-Twelve-Months excl. Cembrit

Cembrit sales process



Not part of FLSmidth’s long term strategy, and a sales process is on-going

Cembrit is reported as discontinued activities

A number of potential acquirers have expressed a preliminary interest in Cembrit

A sales process is expected to be completed within 12 months from the announcement in August 2012, however FLSmidth cautions that there is no assurance that the process will in fact lead to a sale

Acquisition of Ludowici



Acquisition of Ludowici finalised on 3 July 2012

Integration process is ongoing and progressing well

Ludowici to be included across Mineral Processing and Customer ServicesSubstantial sales synergies expected to be achieved over the next couple of years, including

Additional FLSmidth equipment into coal plants

FLSmidth pull through of Ludowici products

Ludowici pull through of FLSmidth products

Added sales from Customer Services

Ludowici to substitute 3rd party screens and wear parts sold by FLSmidth in systems and islands in all focus industries

Ludowici integration ahead of plan



Cross functional integration teams for each business area are established and working effectively

Employee integration in Australia, India China, South Africa, Chile, USA and Peru on schedule and expected to be substantially complete by Q1 2013

Integration of Ludowici manufacturing activities into FLSmidth Super Centers in Chile, Peru, Australia and Tucson ahead of schedule

Supply chain and procurement integration implementation underway and starting to yield results

Successful re-branding and IT migration of FLSmidth Ludowici globally

Ludowici technologies included in larger FLSmidth projects such as the recently announced copper concentrator in Kazakhstan

Market trends



Continued good underlying demand and order intake

Only minor changes in project pipeline or ongoing dialogue with customers

In the short term, mining companies are likely to remain focused on cash flows and reducing capex programs

In the short term, coal and iron ore seem to be the weakest commodities, whereas copper and gold are expected to hold up

Long term prospects remain encouraging

In Cement, proposal activity remain high in many parts of the World. The US cement market is beginning to see a recovery

What are our expectations for the next couple of quarters?

Coal and iron ore weakest commodities in the short term due to slowing growth in China and declining demand for coal in the USA

Copper and gold are holding up due to different structural supply/demand balance

Historically, FLSmidth has highest exposure to copper and gold, where continued high demand is expected

Brownfield expansions and optimisation projects as well as late-stage greenfield projects are likely to be prioritized over new greenfield projects due to shorter payback

Mining Capex outlook




Have we seen any changes in order activity or customer behaviour?

We have noticed public announcements of changed capex budgets, but have seen no significant changes in relation to our proposal hotlist so far

Once investments have been made in infrastructure, mining companies will most certainly also invest in equipment to get a return on investment

Therefore, mining equipment suppliers are typically late-cyclical by nature



80-90% of CAPEX associated with greenfield plants relates to infrastructure, whereas equipmentonly accounts for 10-20% of the total investment

7 January 2013

What if Mining Capex drops significantly in 2013?Mining capex is not just mining capex! The good projects will still be developed and investments will still be made in maintaining and optimising existing operations. Especially, copper and gold projects are likely to continue

Experiences from 2008/2009?Cancellations happens very rarely, and only 3% of the order backlog was cancelled in late 2008

Another 10% of the order backlog was put on hold, but restarted again at a later stage

We were able to bridge the downturn and maintain a stable EBIT margin of 9-10% throughout the cycle due to a high backlog and a flexible cost structure




Future Outlook


Long term financial targets (unchanged)

Future Outlook


Financial targets

Annual revenue growth Above market averageEBITA margin 10-13%Equity ratio >30%Financial gearing (NIBD/EBITDA) <2Pay-out ratio 30-50%CFFI (excl. acquisitions) DKK -700m to -900m

The Board will be considering and adopting new financial targets for Return on Capital Employed in connection with the Annual Report for 2012

Group Guidance 2012 Actual2011

Revenue DKK 25-26bn1) DKK 22bn

EBITA ratio 10%2) 10.9%

EBIT ratio 8%3) 9.9%

Tax rate 30-32% 31%

CFFI (excl. acquisitions and their subsequent Capex needs) DKK -900m DKK -733m

Group guidance 2012 clarified

Future Outlook


1) Continuing activities - excluding Cembrit, and including Ludowici as of 3 July 20122) Previous EBITA-margin expectation of ≥10% clarified at 10% in Q3 3) EBIT-margin expectation reduced in Q2 due to write-down of capitalized R&D costs of DKK

188m. Previous EBIT-margin expectation of 8-9% clarified at 8% in Q3.

Jørgen Huno Rasmussen to retire mid 2013, 10 years after agreeing to join FLSmidth

Thomas Schulz to be appointed new CEO no later than 1 June 2013:

47 years old and German citizen

MSc & PhD in Engineering with a dissertation in Mineral Mining and Quarrying

Employed by Sandvik (Svedala Industries) since 1998, most recently as President of ‘Construction’ and member of Sandvik's Executive Management Group

CEO succession plan

CEO succession plan


Key take-awaysContinued strong order intake, especially in Customer Services

Order prospects continue to be good, particularly in Copper and Gold

Our order book is robust and provides high visibility well into 2013

Work to do on capital efficiency and execution in Material Handling


Back-up slidesSegment information


Customer Services


Customer Services

Customer Services


(DKKm) Q3 2012

Q3 2011 Change Q1-Q3

2012Q1-Q3

2011 Change Full-year2011

Expected trendin 2012

Order intake 3,345 1,270 +163% 6,760 3,983 +70% 5,271 Strongly increasingOder backlog 7,909 6,290 +26% 7,909 6,290 +26% 6,082

Revenue 1,968 1,404 +40% 4,944 3,708 +33% 5,259 Strongly increasingEBITDA 258 253 +2% 695 622 +12% 882

EBITA 226 240 -6% 637 583 +9% 838

EBITA margin 11.5% 17.1% 12.9% 15.7% 15.9% Slightly decreasing1)

EBIT 199 238 -16% 5282) 577 -9% 832

EBIT margin 10.1 17.0% 10.7%2) 15.6% 15.8%

1) Previous expectation: Stable2) Including one-off write-down of capitalized R&D costs in Q2 of approximately DKK 60m

Very strong order intake in Q3 reflects continued good market conditions and a new seven year O&M contract exceeding DKK 1.1bn

Clear pattern of increasing quarterly revenue over the calendar year

Margin adversely impacted by one-off costs related to acquisitions

Strong growth in order intake and revenue

Customer Services


Revenue (quarterly)DKKm EBITA margin+40% vs. Q3 2011

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8 Service Supercenters in the pipeline

Customer Services

37SEB Enskilda Nordic Seminar Prologue

Chile, Peru and Australia in operation in 2012

7 January 2013

Material Handling (previously Bulk Materials)


Material Handling Division

Material Handling


(DKKm) Q3 2012


2012Q1-Q3



Order intake 1,675 1,357 +23% 3,890 4,259 -9% 5,482 IncreasingOder backlog 5,514 5,416 +2% 5,514 5,416 +2% 5,136

Revenue 1,340 1,248 +7% 3,671 3,234 +14% 5,005 IncreasingEBITDA -29 105 n/a 27 114 -76% 276

EBITA -42 91 n/a -9 88 n/a 225

EBITA margin -3.1% 7.3% -0.2% 2.7% 4.5% DecreasingEBIT -60 67 n/a -44 33 n/a 146

EBIT margin -4.5% 5.4% -1.2% 1.0% 2.9%

Weak short term outlook for Material Handling, but large growth potential

Prudent tender approach

Primary focus on improved operational excellence

Good order intake but execution challenges



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Material Handling

Tight focus on execution challenges in Material Handling

Material Handling


Material Handling is the youngest and less mature business area, originating from a handful acquired specialised product companies. These companies work together in a global organisation to provide customers with innovative and value-adding material handling solutions.

The organisation has lagged adequate project execution skills and know-how to handle a sharply increasing business volume

As a consequence, Material Handling has faced challenges related to project execution...

..stemming from underestimated risks in connection with orders received in previous years...

..combined with lack of timely handling and mitigation hereof

A number of initiatives have been put in place, including:

Transfer of project management know-how and best practices from other divisions

New division head and member of Group Executive Management, Carsten Lund took office on 1 July 2012 and has relocated to Wadgassen in Germany, where the Material Handling Technology Centre is based

Strengthened divisional Management Group

Mineral Processing (previously Non-Ferrous)


Mineral Processing

Mineral Processing


(DKKm) Q3 2012


2012Q1-Q3



Order intake 2,598 3,222 -19% 7,849 7,223 9% 9,731 Strongly increasingOder backlog 9,929 8,482 17% 9,929 8,482 17% 8,779

Revenue 2,375 1,838 29% 6,154 4,264 44% 6,766 Strongly increasingEBITDA 240 246 -2% 596 501 19% 859

EBITA 215 238 10% 543 470 16% 815

EBITA margin 9.1% 13.0% 8.8% 11.0% 12.0% Slightly decreasingEBIT 164 204 -20% 3471) 377 -8% 689

EBIT margin 6.9% 11.1% 5.6%1) 8.8% 10.2%

1) Including one-off write-down of capitalized R&D costs in Q2 of approximately DKK 60m

Stable quarterly order intake

Exploration efforts are shifting to areas with more favourable investment climates such as Africa, Mexico, Canada and the CIS countries

Margin slightly under pressure due to one-off costs related to acquisitions as well as run-off of good margin orders taken in pre-crisis years

Continued strong order intake and revenue growth

Mineral Processing



0%3%6%9%12%15%18%

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Order intake (quarterly)-19% vs. Q3 2011DKKm

Products no longer the end but the means:

Islands– plant engineering, third party auxiliary products

Systems EPS – “Bundled Islands” w/ Material Handling

Systems EPC – “Bundled Islands” w/ Material Handling, civil and construction (future)

Life cycle support – O&M, Super Centers

Flexible approach – customers choose

Extended the scope and ”One Source” offerings

Mineral Processing


Single Machines

Uncover the potentialby extending our scope

7 January 2013

Crushing Milling Flotation Thickening Filtration ScreeningExtended

Scope Supply

1. Concentrators2. Gold Plants

(excluding Heap Leach)3. Iron Ore Beneficiation Plants

Concentrator Technology GroupSulfide and other ores of – Copper · Gold · Iron Ore · Platinum · Lead/Zinc · Molybdenum · Nickel

Concentrator Product Groups

Concentrator Flowsheets for Extended Scope Supply


GravityConcentration and

LeachingDownstream

Gold ProductsSolvent

Extraction (SX)Electrowinning

(EW)

LudowiciCentrifuges and Reflux Classifier

Decanter Centrifuges

Extended Scope Supply

1. Copper Leach and SX/EW Plants2. Gold Heap Leach, Carbon Columns

Merrill-Crowe3. Coal Preparation Plants 4. Phosphate5. Alumina6. Nickel Laterite

Hydromet Product Groups

Hydromet Technology GroupOxide and other Ores of – Copper · Gold · Coal · Phosphate · Potash · Alumina · Silver · Nickel

Hydromet Flowsheets for Extended Scope Supply


Rotary Kilns Rotary Dryers Preheaters Rotary Coolers Gas Suspension Calciners

Extended Scope Supply

1. Ferronickel2. Petroleum Coke Plants3. Lime Plants

Pyromet Technology Group Oxide Ores & Thermal Treatment – Ferronickel · Alumina · Phosphate · Coke · Lime

Pyromet Product Groups

Pyromet Flowsheets for Extended Scope Supply


Value Chain

FLSmidth

FlowsheetDevelopment,

Plant Design,Extended ScopeSupply

Crushing Milling Flotation Thickening Filtration Screening

Ore CharacterizationMineralogy,Process Dev.

Value Chain

FLSmidth

FlowsheetDevelopment,

Plant Design,Extended ScopeSupply

Gravity Concentrationand Leaching

Downstream Gold Products

SolventExtraction (SX)

Electrowinning(EW) Classification Centrifugation

Ore Characterization Mineralogy,Process Dev.

Value Chain

FLSmidth

FlowsheetDevelopment, Plant Design,Extended ScopeSupply

Rotary

kilns

Rotary

Dryers Preheaters

Rotars

CoolersGasSuspension Calciners

OreCharacterization Mineralogy,Process Dev.

FLSmidth Hydromet and Coal Prep Products

FLSmidth Pyromet Products

FLSmidth Concentrator Products


Competitive landscape

Mining Equipment competition


Cement


Cement

Cement


(DKKm) Q3 2012


2012Q1-Q3



Order intake 667 1,507 -56% 3,984 3,324 +20% 4,439 Slightly increasingOder backlog 8,579 7,858 9% 8,579 7,858 9% 7,749

Revenue 905 844 7% 2,716 3,020 -10% 4,354 Slightly increasingEBITDA 214 52 314% 471 308 53% 541

EBITA 208 38 461% 445 264 69% 494

EBITA margin 23.0% 4.5% 16.4% 8.7% 11.3% Slightly increasingEBIT 206 33 541% 3651) 253 44% 475

EBIT margin 22.8% 3.9% 13.4%1)

8.4% 10.9%

1) Including one-off write-down of capitalized R&D costs in Q2 of approximately DKK 60m

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Extraordinary high EBITA margin due to projects being executed better than expected and not least finalisation of projects resulting in reversal of contingencies

Proposal activity remains high in many parts of the world, but decision-making is dragging out

The US cement market is beginning to see a recovery

Weak order intake but solid order execution

Cement



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Order intake (quarterly)-56% vs. Q3 2011DKKm

Japan

Italy

IsraelIran

India

Hungary Hong Kong

Greece

Germany

Georgia

Gabon

FranceEstonia

Czech Republic

Croatia

China

Brazil

Belgium Australia

ArgentinaCanada

Singapore

Saudi Arabia

Russia

RomaniaPoland

Thailand

Tanzania

TaiwanSwitzerland

Sweden

SpainSouth Korea

Slovakia

PhilippinesNigeria

NetherlandsMoroccoMexico

Malaysia

Lithuania

Kenya

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Vietnam

United StatesUnited Kingdom

TurkeyTunisia

Emergingmarkets

Maturemarkets

Maturingmarkets

Cement consumption per capita (2006-2009 avg., in kg)

Real GDP per capita (2006-9 avg., in 2005 kUS $)Note: United Arab Emirates and Norway excluded as outliers

Market drivers and outlook

Cement plants are needed where GDP grows...

547 January 2013SEB Enskilda Nordic Seminar Prologue

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mty

Global contracted new kiln capacity (excl. China)

Cement Capex

7 January 2013 55

Global contracted new kiln capacity in 2011: 46 mty (2010: 65 mty)

2012 estimate: 50-60 mty

SEB Enskilda Nordic Seminar Prologue

The key players on the international market:

FLSmidth, Denmark

Polysius, Germany

KHD, Germany (now partly owned by CATIC, China)

Sinoma, China

FCB, France

CNBM, China

Competitive landscape

Cement Solutions competition


flsmidth @ seb enskildanordic seminar prologue 2013

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