gea%20group%20cmd%202013%20 %20presentation%20gea%20me segment%20internet tcm11 25477

GEA Capital Markets Day 2013Presentations GEA Mechanical Equipment

GEA Mechanical Equipment2 GEA Capital Markets Day | June 26–27, 2013

Table of content

GEA Financials – Accelerating Growth through focusing on Core

GEA Mechanical Equipment – Managing Success in Challenging Markets

GEA Mechanical Equipment Financials

GEA Mechanical Separation Sales

GEA Mechanical Separation Service

Q & A

GEA Capital Markets Day – Day 1


Markus HüllmannPresident and CEOGEA Mechanical EquipmentJune 27, 2013

GEA Capital Markets Day 2013Managing Success in Challenging Markets


GEA Mechanical Equipment: OverviewI

FinancialsII

Market & InnovationIII

Global Production ConceptIV

Service Business: OverviewV

Table of content

Pillars of GEA ME‘s SuccessVI


Forward-looking statements are based on our current assumptions andforecasts. These statements naturally entail risks and uncertainties, whichmay cause the actual results of operations, financial position or performanceto diverge significantly from the estimates given here. Factors that could cause such a divergence include changes in the economic and businessenvironment, fluctuations in exchange rates and interest rates, launches ofcompeting products, poor acceptance of new products or services, andchanges in business strategy. We are under no obligation to update forward-looking statements.

Disclaimer

GEA Mechanical Equipment

GEA vision

GEA provides the world with innovative

solutions for smart food processing and for a

more efficient use of energy resources.

GEA is a global engineering group

recognized for its excellent technologies, its

dedication to provide best solutions to its

customers, and its management principles.

The GEA vision shows us where we want to be and is our source of inspiration

GEA Capital Markets Day | June 26–27, 20136


GEA Group‘s segment structure

7 GEA Capital Markets Day | June 26–27, 2013

16 %of Group Sales

12 %of Group Sales

Operating EBIT FY 2012: -3.7%

Operating EBIT FY 2012: 8.0%



GEA Farm Technologies GEA Heat Exchangers GEA MechanicalEquipment

GEA ProcessEngineering

GEA Refrigeration TechnologiesGEA Food Solutions

6 %of Group Sales

10 %of Group Sales

27 %of Group Sales

29 %of Group Sales

~ 100 %food related

~ 100 %food related

~ 6 %food related

~ 54 %food related

~ 68 %food related

~ 61 %food related



Spiral Cookers

Slicers

Thermoformers

Bowl Choppers Milking & Cooling

Farm Services

Farm Equipment

Finned, Shell & Tube

Cooling Towers

Plate Heat Exchangers

HVAC Systems

Separators

Decanters

Homogenizers

Valves

Spray Drying

Aseptic Filling

Brewery & Dairy Systems

Pharma Systems

Compressors

Packages and Skids

Ice Machines

Freezers


GEA Group‘s segment structure


16 %of Group Sales

12 %of Group Sales

Operating EBIT FY 2012: -3.7%




GEA Farm Technologies GEA Heat Exchangers GEA MechanicalEquipment

GEA ProcessEngineering

GEA Refrigeration TechnologiesGEA Food Solutions

6 %of Group Sales

10 %of Group Sales

27 %of Group Sales

29 %of Group Sales

~ 100 %food related

~ 100 %food related

~ 6 %food related

~ 54 %food related

~ 68 %food related

~ 61 %food related



Spiral Cookers

Slicers

Thermoformers

Bowl Choppers Milking & Cooling

Farm Services

Farm Equipment

Finned, Shell & Tube

Cooling Towers

Plate Heat Exchangers

HVAC Systems

Separators

Decanters

Homogenizers

Valves

Spray Drying

Aseptic Filling

Brewery & Dairy Systems

Pharma Systems

Compressors

Packages and Skids

Ice Machines

Freezers


• Within the GEA Group, GEA Mechanical Equipment combines all activities related to mechanical separation, homogenization, pumps, valves and tank cleaning.

• Its process equipment/components ensure smooth production processes at optimized costs in virtually all major industries.

• GEA Mechanical Equipment offers global footprint along the value chain in manyindustries, with a particular focus on the foodindustry

GEA Mechanical Equipment: segment profile


GEA Mechanical EquipmentMarkus Hüllmann

CEO

GEAMechanical Separation

Products• Separators• Decanters• Engineering & Process

Integration• Service

Products• Valves and Valve Manifolds• Pumps• Cleaning Equipment• In-Line Process

Connections• Service

Products• Homogenizers• High Pressure Pumps• Service

GEAFlow Components

GEAHomogenizers

GEA Mechanical Equipment: structure


Jörg TimmermannCFO

Business UnitBusiness Unit Business UnitBusiness Unit Business UnitBusiness Unit


Success factors: geared up for further growth

To Do’s from 2009 …To Do’s from 2009 … … and actions taken… and actions taken

High share of standardized busi-ness but lacking cost efficiency

Customized: focus on solutions Standardized: cost efficiency

Strong installed base – but coverage not best in class

Service resources and tools substantially improved

Efficiency – substantial improve-ment potential in our plants

Flexibility increased, leanprinciples implemented

Fragmented product portfolio in a number of areas (e.g. decanters)

Streamlined product portfolio and improved development efficiency

Centralized organization –lack of customer proximity

Improvement of localcompetencies – CoC, CoE

Service business not a separate business area

Business Area Service with sole focus on service business


• Film „Dare to continue“


LocationsLocations

GEA Mechanical Equipment: global footprint


Worldwide presence to be close to our customers

ManufacturingLocal Sales / Service Teams


Equipment

Processsolution

Market


GEA Mechanical Equipment: route to customer

GEA Mechanical EquipmentGEA Mechanical Equipment

GEA Process Engineering Process integratorGEA Process Engineering Process integrator

CustomerCustomer

Ser

vice

Ser

vice

Pro

cess

Sol

utio

n

Pro

cess

Sol

utio

n

Pro

cess

Sol

utio

n

Pro

cess

Sol

utio

n

Equ

ipm

ent

Equ

ipm

ent

Equ

ipm

ent

Equ

ipm

ent

Equ

ipm

ent

& P

roce

ssso

lutio

nE

quip

men

t &

Pro

cess

solu

tion


GEA Mechanical Equipment: route to customer

Our direct sales approach to thecustomer allowes market penetration andreach:

1. We are able to explain our application know-how in a professional way

and

2. Keep the grip onService business


–

– –

– –

– –

GEA Mechanical Equipment: fields of application


Chemicals / Pharmaceuticals

Marine& Energy

Oil & Gas

EnvironmentalTechnology

Beverage& Dairy

RenewableResources


Product examples: separator, mixproof valve, homogenizer

Mixproof Valves VARIVENTSeparator with integrated direct drive

Homogenization Technology


GEA ME‘s role in our customers‘ processes

Example: Dairy process

Raw milk

Ice water

Cooler

Plat

e he

atex

chan

ger1

Plat

e he

atex

chan

ger2

Heater

Bacteria-removingseparator 1

Homogenizer

Valve


Skimmingseparator

Raw milktank

Pump

Standardized milk


Raw milk

Ice water

Standardized milk

Cooler

Plat

e he

atex

chan

ger1

Plat

e he

atex

chan

ger2

Heater


Homogenizer

Valve


Skimmingseparator

Raw milktank

Pump


GEA ME‘s role in our customers‘ processes

GEA Refrigeration Technologies

GEA Farm Technologies

GEA Heat Exchangers


GEA Process Engineering

GEA Food Solutions

HomogenizerBacteria-removing / Skimming separator Valve

Raw Milk Tank Pump Plate heat exchanger



FinancialsII






685

740

874

972

717

725

844

934

100

117

161

188

14.0%16.1%

19.1% 20.1%

,0

,200

,400

,600

,800

1,000

1,200

2009 2010 2011 2012

EURm

Order Intake Sales EBIT EBIT %


Figures GEA ME 2009 to 2012

GEA ME’s 2009 to 2012 performance – continuous growth in volume and profitability

Note: EBIT = EBIT before restructuring and ppa



FinancialsII






• Growing industrial production and rising wage levels drive demands

• Consumers’ nutrition habits are changing

• Energy consumption is increasing

• Willingness to pay a good price for state-of-the-art, high quality process technology exists

• Purchase decision criteria and motivations for investment into technology as we supply it differ from presently larger mature markets in North America and Western Europe

– Needed for serving the quickly growing number of end-consumers in emerging markets

– Primarily efficiency increases and progressively more regulated production standards in Northern America and Western Europe

The increasing importance of„Emerging Markets“ for GEA


GEA Mechanical Equipment:market success examples

Nozzle separated Greek Yogurt – a strongly growing premium product market

Ballast water treatment with BallastMaster ultraV – outstanding market potential

Next generation of 24/7 PMO Valve®

Improved homogenizer for nano cellulose production

iSep – intelligent separating systems


• Human-machine interface offers an increasing business potential

• Continuous cost-pressure and scarce qualified resources at our customers, the need for self-operating and energy-efficient production processes is growing

• Timely response to changing operating conditions are immediately addressed by automatically adjusting operating parameters

• The nature of service continues to migrate from technical service (mechanics) to supplementary services (condition, utilities and energy monitoring)

• These factors warrant substantial sales potential


Intelligent separator – market

iSep – intelligent separating systems



FinancialsII





GEA Mechanical EquipmentGEA Capital Markets Day | June 26–27, 2013

GEA ME’s global production footprint

2727

Global Production Concept (GPC) – operational excellence and global market coverage

EMEAEMEA Asia / PacificAsia /

Pacific AmericasAmericas EMEAEMEA Asia / PacificAsia /

Pacific AmericasAmericas

20092009 2013 / 20142013 / 2014

FLC

HOM

MSP


GPC – global footprint

GPC – highest flexibility by shiftable capabilities and manufacturing capacities

EMEA

Asia / PacificAmericas

Sales Support

Design & DevelopmentProduction

Innovation


The GPC is close to completion

• Capacity for large separators increases by 50% - delivery times to be reducedby at least 1/3

• First cost benefits already realized (machining centres)• Further cost and WC benefits to be realized from improved plant logistics• Local demand will be served locally (Wuqing/Benaluru):

Benefits from local sourcing Customs/tariffs benefits Infrastructure for service growth

in Asia (workshops, APLC)

29

Global Production Concept (GPC)


Oelde Wuqing

Bengaluru



FinancialsII






Service – development service sales

233.8249.9

270.9308.4

0

50

100

150

200

250

300

350

2009 2010 2011 2012

Service Sales ME

EURm

+7%+7% +8%+8% +14%+14%

Service sales have strongly contributed to the overall growth realized since 2009


Service – service philosophy

Changing service philosophy demands advanced capabilities

Reactive Service Proactive Service

Service PhilosophyService Philosophy

Key

Suc

cess

Fac

tor

Key

Suc

cess

Fac

tor

Service personnel

Spare part availability

Process know-how

Electrical integration

24/7 support

In-time delivery

X

X

X

X

X

X

X

X


Service – GEA ME service potential

Service sales growth potential is highest beyond traditional markets

Traditional technologies

Developingtechnologies

++

++++++++

SizeSize Growth potentialGrowth potential Penetration / market coveragePenetration / market coverage

+


YouOriginal spare parts

Field service

Repairs

Rental bowls / exchange parts

Upgrades / modernization

Service – service portfolio


Customer benefit orientated service product solutions from GEA Westfalia Separator.

Factory rebuilt machines

Condition monitoring

Service level agreements

Reliability consultant – maintenance

Customer training

serv&care – our holistic service concept



FinancialsII




Table of content



GEA ME‘s pillars of success

Customer proximity

Product leadership

Operational excellence

33

55

44

22

11

Profound technological understanding of customer’s processes: Collaborating at eye level

Individual, customized machines: Highest problem solving skills allow best in class solutions

Effective and flexible service organization: Strengthen customer loyalty by lifecycle benefit

Consequently decentralized structure: Centers of excellence strengthen customer proximity

Outstanding operational excellence: processing, production, logistics, GPC


2. Individual, customized machines

Customization:• Bowl• Process

parameter

Standardization:• Drive• Hood• Frame

Outstandingcapability and USP

Efficient productionand price

competitiveness

Customer value bycustomization


= =

Highest problem solving skills allow best in class solutions


2. Profound technological understanding

Based on our outstanding technologicalexperience, we are a valued partner toour customers

We truly understand our customers‘ processes and supply individualizedbest in class equipment

Additionally, with our highly adaptedtechnical solutions we support ourcustomers to save energy and naturalresources

Collaborating at eye level


3. Effective and flexible service organization

Our global service network ensureshighest availability and continuousefficiency of our customers‘ equipment

Our service team significantlycontributes to enlarge new machinesbusiness

Our global service retains maximumasset value and keeps plant technologyupdated

Service itself is a major driving force forprofitable growth at GEA

Strengthen customer’s loyalty bylifecycle benefit


4. Consequently decentralized structure

Our Centers of Excellence ensure quick access to technological and processknow-how – worldwide

We are close to the different markets‘ needs and enhance customers‘ loyalty

The decentralized structure offers highlyefficient processes and short cycletimes

Centers of excellence strengthen customer proximity


5. Outstanding operational excellence

Continuous process optimization is a key driver to further enhance ourcompetitiveness

Our Global Production Concept leads toa significant decrease of process andproduction costs per unit

Local sourcing and our regional logisticshubs ensure a strong lead time reduction across the supply chain

Processing, production, logistics, GPC


Success factors: Geared up for further growth

What we benefited from …What we benefited from …

Growth of customized business– mainly food industry

Ability to explore profitable nichemarkets

Innovations – mechanical focus

Service business growth fromincrease in installed base

Sophisticated service offerings –from reactive to proactive

Efficiency – substantial productivity increases

… and opportunities to come… and opportunities to come

Future growth in standardized business – Marine, Environm.

Standardization w/o limiting customer benefit

Innovations – i-focus, hygienic/ aseptic, new applications

Increase in installed base of customized machines

Service infrastructure & new concepts – CRM, PLCs, etc.

Subtantial extension and globali-zation of production footprint


Table of content





Q & A




GEA Capital Markets Day 2013 Finance

Jörg TimmermannCFOGEA Mechanical EquipmentJune 27, 2013


• GEA ME – a story of profitable growth

• GEA ME‘s success from a financial perspective

• Capital efficiency at GEA ME – cash generation despite Capex

• Geared up for further profitable growth – the CFO agenda


Efficiency and growth …


685

740

874

972

717

725

844

934

100

117

161

188

14.0%16.1%

19.1% 20.1%

,0

,200

,400

,600

,800

1,000

1,200

2009 2010 2011 2012

EURm

Order Intake Sales EBIT EBIT %


Figures GEA ME 2009 to 2012

GEA ME’s 2009 to 2012 performance – continuous growth in volume and profitability

Note: EBIT = EBIT before restructuring and ppa


Figures GEA ME ytd May 2013

Start into FY 2013 shows that growth continues …

347.8 379.0

36.855.3

0

50

100

150

200

250

300

350

400

450

500

2012 2013

EURmYtd May Order Intake

Order Intake >EUR 1m/OrderOrder Intake <EUR 1m/Order

384.6

434.3

0

50

100

150

200

250

300

350

400

450

2012 2013

EURmYtd May Sales

50,3%

356.3 370.4

Notes:1) 14% adj. for FX (USD/RMB), 11% adj. for acquisitions2) 5% adj. for FX (USD/RMB, 2% adj. for acquisitions


Growth by customer industry

126 156 197 235121 116

131156117

140171

19684 41

44

58

45 29

44

40

47 45

48

40

23 40

41

39

93 104

109

111

60 44

50

48

1 10

9

11

0

100

200

300

400

500

600

700

800

900

1.000

2009 2010 2011 2012

Other Industries

Climate & Environment

Marine

Chemicals

Pharma

Power

Oil & Gas

Food & Beverages - Non-Liquid

Food & Beverages - Liquid

Food & Beverages - Dairy

We have managed to balance ups and downs in different customer industries and benefited from a booming food market

non-

food

. 35

4no

n-fo

od.

354

food

365

food

365

non-

food

. 34

7no

n-fo

od.

347

food

587

food

587

EURm

,


0

50

100

150

200

250

300

Mar

May Ju

lSe

pN

ov Jan

Mar

May Ju

lSe

pN

ov Jan

Mar

May Ju

lSe

pN

ov Jan

Mar

May Ju

lSe

pN

ov Jan

Mar

May Ju

lSe

pN

ov Jan

Mar

May

2008 2009 2010 2011 2012 2013

OI < EUR 1m OI >= EUR 1m < EUR 5m OI >= EUR 5m < EUR 15m OI >= EUR 15m


Strong development of our base level business – projects smaller than EUR 1m and Service (Rolling L3M view)

Order Intake by project size


Development Service sales

Service sales have strongly contributed to the overall growthrealised since 2009

EURm


233.8249.9

270.9308.4

0

50

100

150

200

250

300

350

2009 2010 2011 2012

+7%+7% +8%+8% +14%+14%


Regional growth

12%

11%

16%61%

Total Sales FY 2009: EUR 717.5m

Asia Pacific w/o China

China

North America

Others

17%

11%

18%

54%

Total Sales FY 2012: EUR 933.9m

78.1 85.1

14,8

FY 2009 FY 2012

China China fx

8.6%(2.9%)8.6%

(2.9%)

114.5157.4

13.3

FY 2009 FY 2012

USA USA fx

14.2% (11.2%)14.2% (11.2%)

93.4137.3

21.0

FY 2009 FY 2012

Asia Pacific w/o China fxAsia Pacific w/o China

CAGR % 19.2%(13.7%)19.2%

(13.7%)


100.2

187.9

30.2

31.7

25.7

0

50

100

150

200

250

EBIT pre ppa &restructuring

2009

Additional EBITfrom volume

Mix and priceeffects

Operating leverageand efficiency

EBIT pre ppa 2012

EURm


Development of EBIT – growth, leverage and mix

GEA ME strongly benefited from growth, mix, leverage andefficiency improvements

• EUR 216m sales growth@ 2009 margin (14%)

• Back to pre crisis volumeonly in 2011

• Above avg growth offood business

• Strong growth of after sales/ service

• Contribution/FTE upby 25% from 2009 to2012

• GPC effect partiallyrealised

14.0%14.0%

20.1%20.1%

+610 bp


Continuous improvement of WC/sales ratio since 2009

Working capital development

Implemented improvement measures• Level of stock machines reduced• Tight debtor/creditor management• EPLC started end of 2010• Outsourcing vs Insourcing

Ongoing improvement measures• Global Production Concept• PLC‘s in Asia and the Americas• Standardization• Improved sales planning (CRM)

242.

2

218.

3

217.

5

170.

4

187.

4

184.

0

178.

6

178.

0

187.

0

197.

1

184.

7

178.

1

200.

6

206.

5

208.

4

179.

9

224.

1

23.7%

27.8% 27.5%25.6%

24.5%24.6% 24.8%22.9%

21.1%23.1%

23.5%22.8%

19.3%24.0%

0

50

100

150

200

250

300

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2009 2010 2011 2012 2013

Working Capital (EURm) NOWC/LTM-Sales in % Linear (NOWC/LTM-Sales in %)

EURm


Most significant infrastructure investments substantiallycompleted – capex will return to normal level of ~ 2.5% of sales

Capital expenditure

2.4%

1.3%1.9%

2.7%

3.2%

2.2%

6.7% 6.8%

0

10

20

30

40

50

60

70

80

FY 2009 FY 2010 FY 2011 FY 2012

EURm

Global Production Concept Other Capex Capex-% of sales excl. GPC

Capex-% of sales Normal capex requirement


GEA ME – Cash generation despite unusually high level of capex

Cash flow driver

-100

-50

0

50

100

150

200

250

Jan

Feb

Mar

Apr

May Jun

Jul

Aug

Sep

Oct

Nov

Dec Jan

Feb

Mar

Apr

May Jun

Jul

Aug

Sep

Oct

Nov

Dec Jan

Feb

Mar

2011 2012 2013

Cash Flow Driver Development - L12M

EBITDA L12M Delta WC L12M CAPEX L12M CFD-% L12M CFD Margin L12M @ 2.5% Capex

~18% of

sales

~14% of

sales

EURm


ROCE development


368 346 328 310 301 304 308 318 329 345 373 402 430 456 465

23.8%24.5%26.5%28.7%34.5%36.8%

42.4%45.8%49.0%48.9%45.0%44.1%43.0%41.0%40.0%

0

100

200

300

400

500

600

Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 May

2009 2010 2011 2012 2013

Capital Employed (average LTM) ROCE (average LTM)

EURm

*ROCE LTM = EBIT (LTM) / Capital employed excluding goodwill from the acquisition of the former GEA AG by the former Metallgesellschaft AG in 1999 (average LTM)

ROCE driven by strong EBIT development and impacted by GPC



Success factors from CFO agenda …Success factors from CFO agenda …

Continuous improvement ofexisting production facilities

Intelligent sourcing decisions –outsourcing vs insourcing

… to be continued and further extended!… to be continued and further extended!

Lean concepts to be rolled out to further functional areas

Increasing extent of “local” sourcing

Effective control environment –avoidance of failures

Further enhance transparency – op. KPI dashboards / CRM

Efficient ERP systems environ-ment – one SAP template

Use of enhanced ERP solu-tions SAP EWM, APO, BI …

But most importantly …But most importantly …


... our success depends on … our people!... our success depends on … our people!




Table of content





Q & A




GEA Capital Markets Day 2013Sales


Ann CuylaertsVice President Sales InternationalGEA Mechanical SeparationJune 27, 2013


Set up sales organization


SalesSales

SalesSales Order Processing

Order Processing

Central ProcessTechnology



Energy & Marine

Beverage & Dairy

RenewableResources

Chemicals / Pharma

Environmental Technology

North America


Asia

EasternEurope& CIS

LatinAmerica

WesternEurope

Africa

Oil & Gas

Sales



Know-how bundled centrally

Responsibility for a specific application worldwide Product & process know-how Business development Development of new applications and product


Responsibility for a region/country for all applications Market development Local sales competence for customer intimacy Where applicable Center of Competence / Center of Excellence

Competent local sales force

LocationsLocations

ManufacturingLocal Sales / Service Teams





SalesSales


Order Processing






Product analysis Lab spinning tests Pilot scale testing of new applications Test machines

Central Process Technology


How do we differentiate?

73

Innovation, being technology leader, setting standards

Differentiation by customization

Grab opportunities by process know-how

Innovation, know-how and customization


Integrated direct drive

Gear drive

Belt drive

Innovations made by GEA are setting standards

19821958 2004 2008

Standard direct drive


Innovations made by GEA are setting standards


Geardrive

Beltdrive

Standard directdrive

Integr. directdrive

Efficiency - - + ++ ++

Space requirement + - - ++

Max. drive power - + ++ -

Wear parts - - + + ++Reliability / availability - + + ++

Ease of maintenance - + - +

Noise emission - + + ++

Comparison of different drive concepts



76






Individual, customized machines

Customization:• Bowl• Process

parameter

Standardization:• Drive• Hood• Frame

Outstandingcapability and USP

Efficient productionand price

competitiveness



= =

Highest problem solving skills allow best in class solutions



78






Grabbing opportunities, reacting on trends

Market share increased by 31% since 2008

Sales exceeded $1.5B in 2012

Average US consumers doubled expenditures for yogurt since 2002

US consumers are willing to pay price premium for healthy yogurt

Manufacturers claim cost effectiveness and high efficiency

Greek yogurt market share of US yogurt market

2008

2012

35%

4% +31%

1.5B

US EUUS EU

Expenditure Consumption

20%50%

Nozzle separated Greek Yogurt – a strongly growing premium product market


Production methods need to emphasize the traditional character of the product

GEA ME’s nozzle type separator KDB is a unique solution Special design Continuous operation High yield: no partial solids discharges, no losses Low idle time (CIP ≥ 16h) Low OPEX (water, electricity, ice-water, cleaning costs)

Customer intimacy: GEA supplies to key players


Grabbing opportunities, reacting on trends

Nozzle separated Greek Yogurt


The challenge

81

customization, technology leadership, grabbing opportunities

Scale, volume

&

Combining customization with volume

GEA Mechanical Equipment82

The challenge

Covered by low-end competition; experience will let them enter new(our) segments

Real growth potential in the middle market segment, especially in emerging markets

GEA Westfalia Separator has a dominant position in this marketsegment


Leading market position challenged by dynamic market environment


The solution

83

High quality standard

Highly standardized

Designed to basic needs

2nd product range: GEA Westfalia Separator easyline


Innovation, next control unit generation

84

Intuitive human interface

Modular programming

Integrated Operation – IO


Ratification of IMO guidelines forces ship owners to implement ballast water treatment systems

Market potential is high:

€ 4.4B for retrofits (~33,000 ships; aged ≤ 14 years)

€ 2.0B for new vessels (~ 1,500 vessels p.a.)

Ship owners demand cost efficiency, reliability and process safety


Innovation, ballast water treatment – the market

Ballast water treatment with BallastMaster ultraV – outstanding market potential


BallastMaster ultraV is our next seaprotectsolutions milestone

High performance / low maintenance

Green and safe

Flexible and adaptable


Innovation, ballast water treatment

BallastMaster ultraV – conquering new markets in marine business


A strong, experienced sales team

Innovative products, setting the standards in the market

And there are more innovations to come to grow our installed base

Summary

GEA Westfalia Separator stands for:


Table of content





Q & A




GEA Capital Markets Day 2013Service


Steffen BerschVice President Sales InternationalGEA Mechanical SeparationJune 27, 2013


Service sales @ GEA ME (BU MSP)CAGR (2009 – 2012): ~10%

205.5220.9

239.2

269.2

0

50

100

150

200

250

300

2009 2010 2011 2012

Ser

vice

Sal

es @

BU

MS

P

EURm

+8%+8% +8%+8% +13%+13%

• BU MSP Service stands for 80% of GEA ME segment service• BU MSP Service share in relation to new equipment sales is 30-35%• The Service product share is spare parts (70%), repairs (15%) and field service (15%)


GEA ME (BU MSP) in comparison to VDMA benchmark

Benchmark criteria VDMA avg. VDMA best BU MSP

Organization structure Profit Center Profit Center Profit Center

Reporting to CEO CEO CEO

Service share in comparison to total sales

20% 30% 30 – 35%

Growth of service business (VDMA 2005 reference)

2% 5% ~10%*

Spare Part share in comparison to total service sales

58% 90% 70%

Availability of parts (first pick) 75% 96% 80%

Delivery times for parts (Europe) 4.4 days 1.0 day 1.0 day

Delivery times for parts (Global) 8.2 days 3.0 days 3.0 days

Source: VDMA Kennzahlen (vergleichen, verstehen, verändern) – Kundendienst 2012*average growth from 2009-2012


Service product portfolio –segmentation enabled development in service business

Service Cluster 1

• Installation and commissioning• Training• Consumable parts• Spare and wear parts• Service and maintenance• Unplanned repair• Planned repair

• Installation and commissioning• Training• Consumable parts• Spare and wear parts• Service and maintenance• Unplanned repair• Planned repair

Service Cluster 2

• Improved service (e.g. retrofit, modernization)• End-of-Life Services• Reconditioning• Product monitoring• Services based on telecommunication network• Competitive product and related products/systems

• Improved service (e.g. retrofit, modernization)• End-of-Life Services• Reconditioning• Product monitoring• Services based on telecommunication network• Competitive product and related products/systems

Service Cluster 3

• Consulting services (e.g. planning, inventory management, logistics, SCM)

• Not intended in GEA ME’s service scope are:• Financing services (e.g. financing, leasing, renting,

insurance)• Operational process outsourcing (e.g. line operation,

output guarantee)• Business process outsourcing

• Consulting services (e.g. planning, inventory management, logistics, SCM)

• Not intended in GEA ME’s service scope are:• Financing services (e.g. financing, leasing, renting,

insurance)• Operational process outsourcing (e.g. line operation,

output guarantee)• Business process outsourcing

Product based service

in narrowsense


in narrowsense


in broadersense


in broadersense

Not directly product related service

Not directly product related service

alre

ady

cove

red

by G

EA M

Ede

velo

ping


GEA MSP service performance


Success factorsthat ensure furthergrowth of service

business

Success factorsthat ensure furthergrowth of service

business

More than 650 trained own service

personnel

Installed base:~ 70,000 deliveredmachines25 authorized repair workshops

repairing 1,500 machines/year

250 spare partshipments/day;

65,000 customercontacts/year

Automatic track and trace for every shipment

>100,000 activespare parts

Emergency deliverytime less than 24 hours in Europe

2 regional logisticcenters &

40 local hubs forparts

Installed base in more than 180 countries covered by over 40 own sales & service companies


The OUTLOOK – growth driver of the service business: development of the iBase

The installed base of delivered machines is growing. The growth rate of service potential is 4.5%.

Separators Decanters

Piec

es


The OUTLOOK – growth driver of the service business: utilization of service potentials

The iBase is growing continuously, the service potential is growing by 4.5% p.a..

Annual service spend is 4-7% of the replacement asset value.

The lifetime of a centrifuge is between 20 and 40 years.

Capture rate is 65% (in 2005: only 53%).

Capture rate in developed markets at 70-80%, while in emerging markets it is at 40-50%.

High capture rate in Food, Chemical/Pharmaceutical and Renewable Resources applications


serv&care

• Film



The service products and programs of GEA Westfalia Separator are designed to fulfill the three central tasks of maintenance.

Three central tasks of maintenanceThree central tasks of maintenance

Increase reliability

of the equipment

Increase reliability

of the equipment

Cost control

Cost control

Efficient processesEfficient

processes

Meet budget request

Meet budget request

Maximum utilization of raw product

Maximum utilization of raw product

Higher availability of the plant

Higher availability of the plant



1970 – 19901950 – 1970 1990 – 2005 2005 – 2013

Strategy Breakdown Preventive PredictiveRCM*

ProactiveRCM*

Approach Fix it Scheduled Conditionmonitoring

Failure sourcedetection

Humananalogy

Heartattack By-pass Detection

via EKGMonitor cholestorol

*RCM = Reliability-Centred Maintenance


Why we want to focus even stronger on service in the future and what is on our agenda:

EBIT margin substantial above group average

Low volatility in revenue generates continuous earnings stream

Strong contribution to customer relationship


What is on the agenda?


Increase service coverage of the installed base (International Repair Network; Marine Service Network; Logistics)

Expand the service product portfolio (more pro-active maintenance products)

Broaden geographic coverage and strengthen local capabilities (GEA ME Campus; de-central training)

Improve condition monitoring by setting up a machine operation center

Global roll-out of SAP-Service-CRM to get 360° view on customers


Table of content



GEA Mechanical Equipment Sales

GEA Mechanical Equipment Service

Q & A




GEA GroupJune 27, 2013

Questions & Answers

gea%20group%20cmd%202013%20 %20presentation%20gea%20me segment%20internet tcm11 25477

Documents