Atlas Copco Capital Markets Day 2017 Henrik Elmin, Business Area President
2 Agenda 11. Facts in brief 21. Fundamentals 31. Trends and opportunities a b c d Electric vehicles Light-weighting General industry Smart factory 41. Summary
ROCE 43% 3 Growth drivers Orders, revenues and operating margin Further developing the offer within assembly technologies Innovation is key Extend the service offer
Helping our customers with critical processes 4 Tightening Drilling Material removal Dispensing Self-pierce riveting Multiple industries Aerospace Metal fabrication Automotive Automotive
Tightening: Multiple industries 5 Automotive PowerTrain Tiers Electronics White goods Aerospace Off-road Energy Vehicle maintenance
6 Business concept General industry Partner in assembly technology Drilling Operator guidance Tightening Quality assurance Maintenance Process Improvements
Service Revenues from service, parts and consumables CAGR 2012-2016 16% 7 5 000 50% 4 000 40% 3 000 30% 2 000 20% 1 000 10% 0 2012 2013 2014 2015 2016 0% Service and consumables revenues, MSEK Service and consumables, share of revenues, %
Sustainable productivity in practice 8 HIGHEST ETHICAL BEHAVIOUR COMPETENT TEAMS SAFETY & WELL-BEING INNOVATE FOR ENERGY EFFICIENCY EFFICIENT USE OF RESOURCES EXAMPLE 1 EXAMPLE 2 EXAMPLE 3 The Henrob SPR Eco Controller The SCA 5 step Material Efficiency Package The TBP Battery Pulse Tool System
Trends 9 1 Quality assurance 5 Electric vehicles 6 Light-weighting 2 Ergonomics / safety 7 Electronics 3 4 Middle class growth Emerging markets 8 9 Flexible lines Automation 10 Data driven service
Strategic approach to acquisitions 10 2011 2011 2013 2013 2013 Adhesive systems and metering technology Drilling equipment Quality control solutions Mechanical and electrical wrenches Hydraulic torque wrenches and pumps 2013 2014 2014 2015 2016 High torque bolting solutions Self-pierce riveting Hydraulic torque wrenches and pumps Process control solutions Adhesive dispensing equipment
What will be the impact of electric vehicles? 11 SIMPLIFIED Base case New vehicle sales by powertrain type, % 61 75 91 98 5 4 13 2 11 22 3 11 4 2015 2020 2025 2030 Base case assumptions in 2030 Internal combustion engines Hybrid electric vehicles Plug-in hybrid electric vehicles Battery electric vehicles SOURCE: McKinsey 2017 ~90 USD/kwh CO 2 ~70 g CO 2 /km ~5% shared vehicle sales
12 What will be the impact of electric vehicles? Body shop Paint shop Final assembly Tier suppliers ICE powertrain suppliers E-powertrain Demand for Atlas Copco applications P/HEV BEV P/HEV BEV P/HEV: BEV: Plug-in/Hybrid Electric Vehicles Battery Electric Vehicles
Electric vehicles will drive demand 13 TIGHTENING TIGHTENING ADHESIVES RIVETING TIGHTENING
Light-weighting: Increased need for mixed material joining 14 Automotive Share of light-weight materials will increase Material split / percent SOURCE: McKinsey 2017
Light-weighting: Increased need for mixed material joining 15 Aerospace
General industry: Improving production yields in electronics 16 Growth in Electronics
New opportunities in the Smart factory 17 Increased automation Increased line complexity
18 Process Deviation Operator Issue Equipment Problem
Summary 19 Major opportunities in electric vehicles and multi-material design Well positioned in the Smart Factory Continuation of sustainable business model in the Automotive and General Industries
Committed to sustainable productivity.
Cautionary Statement Some statements herein are forward-looking and the actual outcome could be materially different. In addition to the factors explicitly commented upon, the actual outcome could be materially and adversely affected by other factors such as the effect of economic conditions, exchange-rate and interest-rate movements, political risks, the impact of competing products and their pricing, product development, commercialization and technological difficulties, supply disturbances, and major customer credit losses.