Capital Market Day 2014

Customers Services Division

CMD illustration to come
Brian Day, Group EVP
Brian M. Day, Group EVP Customer Services
 Group EVP, Customer Services Division, since
Jan 2015
 FLSmidth from 2007:
 Senior Vice President, Global Customer
Services, Minerals
 Vice President, Global Customer Services,
Minerals
 GL&V-Dorr Oliver Eimco: Vice President
Aftermarket (2002-2007)
 Baker Hughes Inc.: Aftermarket Manager
(1991-2002)
 EIMCO Process Equipment Company: Product
Engineer / Process Engineer (1980-1991)
 Bachelor of Science degree, Sales recruiting
and training, Leadership and business
management
 Born 1956, American

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The Customer Services Division in brief
 Full array of services before, during Revenue (BDKK) EBITA%
and after delivery of new plants and 8 20%
equipment 6.8
7.2

 More than 100 warehouse, service and 6 5.6 15

support centers Worldwide

 More than 2/3 of all employees are in 4 10

direct customer contact (~6,400 employees)

2 5
 Main business:
 Spare parts ~70%
0 0
 Service ~15% 2012 2013 2014 Future
Q1-Q3
 O&M ~15% Revenue
Revenue EBITA% growth

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Total Cost of Ownership Approach

Purchase Operating and

Price maintenance costs
over plant life will in
most some cases far
Total Cost of Ownership

outweigh purchase
CAPEX price…

Transportation Warehousing
…and what about
Labour support on items that
Consumption
Purchasing are linked to
administration
or Usage productivity
Reliability (throughput), uptime
OPEX Repairs and safety over the
Productivity
life-cycle
Safety

Maintenance
Inflation
Offer up front-
standard repeatable
Disposal models

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How we service our customers

 Maximize our customers’ plant productivity and return on assets

by providing parts, maintenance, rebuilds, upgrades and services

 Increase customers’ return on assets by providing expertise in audits, operation

and maintenance of our customers’ plants (including all aspects service, parts
and rebuild, regardless of the age, location and OEM of the plant)

 Deliver a superior alternative to customers’ for OEM replacement parts and

services for mission critical equipment used in global mining

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 Achieving profitable growth
by maximizing our customers’ productivity

Our ambition:
Our vision:
 5-10% annual revenue growth over cycle
 EBITA > 15% Best in class in
 NWC 15-20% maximizing our
 Develop O&M to become industry standard customers’ productivity
 Grow wear parts business >10% and return on assets.
 Target strategic products and geographies with specific skills
and best practices

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 Regional alignment of organisation
Understanding regional needs is key..

North America Europe Russia & CIS

 Upgrades & retrofits  Upgrades & retrofits  Site services
 Canada projects  Export markets  O&M
 Parts (stock) & services  Installed base support
 Account management

Australia & Southeast

Asia
Americas EMEAI  Upgrades & retrofits -
ours and competitors’
 Process audits
ASEC  Install site services
Central & South America  O&M
 Service offerings
 Service center repairs-
key accounts
 Wear parts (e.g. mill liners)
Africa & Middle East India
 O&M (primarily “M”)
 Service offerings- local  Back end support
service units  Customer clusters-
 Wear parts (e.g. mill liners) installed base
 O&M  O&M (Power industry
 Upgrades & retrofits ship unloaders)
Americas: North, Central and South America
EMEAI: Europe, Middle East, Africa and India
ASEC: Australia, South East Asia and China

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Building strong customer relationships
and increasing our customers’ productivity

 Leverage our local direct highly trained service and parts organization

 Ability to react quickly to customer needs - speed

 Account management- customised offerings

 Strategic footprint - warehouse, service and support centers

 Predictive maintenance - asset management; total cost of ownership

modeling; training

 Leverage strong product and flow-sheet capabilities in Cement and

Minerals (engineered solutions)

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Service Offerings - Value Chain

Operation &
Maintenance
Rebuilds &
Upgrades • Full scale Maintenance
Services program
• On-Site repair , • Full scale Operations
assembly program
Parts • Cost per ton program
• Service Audits • Service supervision
service • Remote monitoring and
• Troubleshooting
• Complete rebuilds / trouble shooting
• Stocking of fast moving • On-site repairs
repairs / retrofits / • Enhanced uptime
& strategic parts • Parts installation calibration
• Predictive maintenance
• Stock location optimized • Service supervision • On-Site Training
service programs • Improved performance
for efficient delivery and
serviceability • On-site permanent set • Laboratory sampling
up (where applicable) services
• Simplified order
handling process • On-Site training • In and out programs
programs
• 24/7 enquiry handling • Service multiple
(orders & customer sites
troubleshooting) • Process optimization
• Service Training assistance
Programs

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Service Centers – strategically located

Perth Supercenter

Corporate Social
Health & Safety Plant Availability Increased Knowledge
Responsibility
Strategic Stock
Equipment/Process Training/Education
Safety Training Training to Support Local
Rebuild and Repair
Communities
Building Local Skill
Small-scale Lab Level
Sustained Focus on Eco-Friendly
Safety Culture Customized Buildings
Mechanical Audits Training

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FLSmidth Intelligent Collaboration
Environment Room (ICE) - Valby

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Sustainable value creation
Virtuous circle: CSR as a driver for O&M
productivity
Case study in Eqypt:
Significant social-economic impact through O&M business model

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Plant availability and Asset management

Maximise client’s return on investment by achieving rapid ramp-up from

commissioning and guaranteeing high plant availability and high levels of
production throughout the life of the project.

FLSmidth Service
100%
Typical Operation

Increased Availability from FLSmidth

rated capacity

Service

0% time

ramp-up operations

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Product and Flow Sheet Intelligence

• Asset management
• Maintenance planning
• Parts and resource forecasting
• Plant lifecycle predictability

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The Customer Services Division:
Key takeaways

 Resilient and growing business area

 Focused regional approach with local direct support

 Leverage efforts to service both industries

 Particular growth areas:

 Develop Operation & Maintenance to become industry
standard
 Move into wear parts to close customer relationship gap

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