Presentation is loading. Please wait.

Presentation is loading. Please wait.

Tom Johnstone, President and CEO CMD 2013. © SKF Group CMD 2013 Key items H1 summary and outlook SKF priorities Specific focus - IT investment (UNITE)

Similar presentations


Presentation on theme: "Tom Johnstone, President and CEO CMD 2013. © SKF Group CMD 2013 Key items H1 summary and outlook SKF priorities Specific focus - IT investment (UNITE)"— Presentation transcript:

1 Tom Johnstone, President and CEO CMD 2013

2 © SKF Group CMD 2013 Key items H1 summary and outlook SKF priorities Specific focus - IT investment (UNITE) - Cost reduction and Purchasing

3 © SKF Group CMD 2013 Highlights H Acquisitions and divestments SKF completed the acquisition of German-based ship components provider Blohm + Voss Industries (BVI) SKF divested the aerospace metallic rods business New facilities in India a new lubrication systems laboratory in SKF Global Technical Centre a new manufacturing unit in Pune for producing housings for bearings Two new SKF Solution Factories Inaugurated in Madrid, Spain and Katowice, Poland Programme to improve efficiency, reduce cost and strengthen profitable growth continues one-off costs of around SEK 440 million annual savings of around SEK 180 million Katowice, Poland Madrid, Spain

4 © SKF Group CMD 2013 Highlights H Some examples of new business with Pratt & Whitney, to supply engine main shaft bearings with Nordex for delivery of mainshaft bearings and lubrication systems for automated lubrication systems installed in the MSC Home Terminal cranes in Belgium’s Port of Antwerp with a steel and mining company for industrial bearings and units, seals, mechatronics, and services with Öhlins Racing AB for SKF’s integrated monotube seal with the Chinese customer Great Wall for hub bearing units 10-year contract worth SEK 900 million with Turbomeca service contracts worth SEK 200 million in Latin America contract for wheel hub bearing units (HBU3) to Volvo Car Corporation Thrust main shaft bearing, one of the bearings for the ARRANO Engine of TURBOMECA

5 © SKF Group CMD 2013 Half year 2013 SEKm Net sales31,54434,105 Operating profit3,3174,185 Operating margin, % Operating margin excl. one-offs, % Profit before taxes2,8643,730 Net profit1,9222,570 Basic earnings per share, SEK Cash flow, after investments before financing 2551,382

6 © SKF Group CMD 2013 Europe -7% Asia/Pacific -5% Latin America 11% Middle East & Africa -4% North America -6% Growth development by geography and by business area Organic growth in local currency YTD 2013 vs YTD 2012 SKF Group: -5.1% Strategic Industries:-9.9% Regional Sales and Service -6.3% Automotive2.0%

7 © SKF Group CMD 2013 Share of net sales 2012 Europe43% Asia Pacific24% North America23% Latin America7% Total Q vs Q / Sequential trend for Q SKF demand outlook Q3 2013, regions

8 © SKF Group CMD 2013 Sequential trend for Q Share of net sales 2012 Strategic Industries 31% Regional Sales and Service 39% Automotive27% Total Q vs Q SKF demand outlook Q3 2013, business areas

9 © SKF Group CMD 2013 Key items H1 summary and outlook SKF priorities Specific focus - IT investment (UNITE) - Cost reduction and Purchasing

10 © SKF Group CMD 2013 SKF priorities

11 © SKF Group CMD 2013 Growth and operating margin SEKm Operating margin 11.4%, excl. one-time costs 12.0% Operating margin 9.5% +17% -4% +51% -12%

12 © SKF Group CMD 2013 Key elements of Sustainable Profitable Growth Platforms Asset life cycle + service SKF BeyondZero portfolio 2nd brands Acquisitions New products QPM Macrotech PEER GLO Cirval GBC BVI S2M ALS ABBA Baker Lincoln

13 © SKF Group CMD 2013 Key items H1 summary and outlook SKF priorities Specific focus - IT investment (UNITE) - Cost reduction and Purchasing

14 © SKF Group CMD 2013 UNITE One SKF Knowledge Engineering Company Preferred by customers, employees and partners. Strong in purchasing and operations. CustomersEmployees Suppliers Operations SKF investment in IT – UNITE programme

15 © SKF Group CMD 2013 UNITE - One End-to-End Process 4. Sales & Operations Planning 7. Order & receive goods/ services 8. Production scheduling 9. Production execution 10. Deliver & customer Follow-up + Payment 1. Go To Market 2. Manage opportunities 3. Process order & confirmation Customer to Cash Forecast-to-Fulfill Purchase-to-PayRecord-to-Report 5.S&OP Meeting 6. Manage suppliers & contracts

16 © SKF Group CMD 2013 SKF investment in IT – UNITE programme Multi year programme New Demand Chain systems New Finance system First main installations Sales unit in Q Sales & Manufacturing unit in Q Estimated cost SEK ~500 m in 2013 (of which SEK ~300 m capitalised) SEK ~900 m in 2014

17 © SKF Group CMD 2013 Key items H1 summary and outlook SKF priorities Specific focus - IT investment - Cost reduction and Purchasing

18 © SKF Group CMD 2013 SKF Restructuring programme – costs and expected savings Restructuring activities launched in: SEKm Q4 2012Q1 2013Q2 2013Total One-off costs Annual savings when fully implemented The savings for the second half 2013 from these programmes will be around SEK 150 million, evenly split between the third and the fourth quarter.

19 © SKF Group CMD 2013 SKF Global Spend Total SKF spend Total SKF spend is SEK 36 billion – direct and indirect representing ~ 50% respectively 18% 44% 38% Rings & Subcontracting Components 8% 12% 13% 21% 18% 27% CAPEX IT Logistics Professional Services Facility Management MRO SEK 17.7 billion Direct Material Indirect Material & CAPEX SEK 15.6 billion Source: Spend cube Indirect MaterialIndirect MaterialIndirect MaterialIndirect MaterialDirect MaterialDirect MaterialDirect MaterialDirect Material Total Steel Raw Material & Rolling Elements

20 © SKF Group CMD 2013 Natural disasters Price and currency volatility Sustainable and Responsible Sourcing Geopolitical Risk Supplier Innovations Global & Local Supplier Relationships Supply Chain Disruptions Challenges in the global supply chain – many factors Effective sourcing strategy Market demand variations and volatility

21 © SKF Group CMD 2013 Key initiatives to achieve savings Category and business driven purchasing Supplier consolidation and localization Leverage of all purchasing power across all businesses Product, process & system standardization Total cost approach and leading purchasing practices applied

22 © SKF Group CMD 2013 Target: China supplier development to secure capacity and Q C D I M targets SKF benefits: Access to a supplier base in China close to Dalian 100% localization 2 suppliers fully approved in China Worldwide supplier market base fitting with new SKF manufacturing footprint Development of a Chinese suppliers base with export capacity Success Story – localization of cages in China Contract Status: 2012/2013 Savings: -40/50% vs Import in China

23 © SKF Group CMD 2013 Total Savings: USD 760,000 – 30% savings Supplier reduction: 14 3 Activity Combine purchasing of packaging materials across a number of units SKF benefits Reduction in supply base Cost savings Standardized packaging from one supplier Success Story Packaging – Cross platform leverage Corrugated & Anti-counterfeit packaging

24 © SKF Group CMD 2013 Success Story Standardization of capital equipment Equipment for Grinding, Honing, Laser marking and Assembly Clear business requirements Improved sourcing process Standardization of equipment Cross business leverage Regional Asian supplier base developed with global capabilities SEK 280 million of total cost savings HBU3 channel standardization

25 © SKF Group CMD 2013 Purchasing ramp up and saving plan New Group Purchasing organization in operation New process framework Sourcing waves 1 / Speed sourcing started to leverage spend across all BUs Integration of BU Purchasing Localization of the strategic supplier base New Group Purchasing organization in operation New process framework Sourcing waves 1 / Speed sourcing started to leverage spend across all BUs Integration of BU Purchasing Localization of the strategic supplier base Separation of strategic tasks from transactional tasks Sourcing waves 2 and continued Speed Sourcing activities Supplier Innovation Programmes on stream Strategic Partnership Agreements with key suppliers Common purchasing processes Supplier consolidation Separation of strategic tasks from transactional tasks Sourcing waves 2 and continued Speed Sourcing activities Supplier Innovation Programmes on stream Strategic Partnership Agreements with key suppliers Common purchasing processes Supplier consolidation Category and business driven organization fully leveraging SKF’s purchasing power Purchasing supporting the full internal value chain Focus on Total Cost of Ownership (TCO) Strong alignment with the business through a clear target setting process Highly competent purchasing professionals Reduced supply chain risk and costs through top performing suppliers in Q C D I M Category and business driven organization fully leveraging SKF’s purchasing power Purchasing supporting the full internal value chain Focus on Total Cost of Ownership (TCO) Strong alignment with the business through a clear target setting process Highly competent purchasing professionals Reduced supply chain risk and costs through top performing suppliers in Q C D I M SEK 1,500 m

26 © SKF Group CMD 2013 SKF priorities

27 © SKF Group CMD 2013 Key business message No change in demand outlook for Q3 SKF priorities in focus – good progress in H1 New IT investment (UNITE) and purchasing programmes going according to plan


Download ppt "Tom Johnstone, President and CEO CMD 2013. © SKF Group CMD 2013 Key items H1 summary and outlook SKF priorities Specific focus - IT investment (UNITE)"

Similar presentations


Ads by Google