Pres1 OleJohansson CMD

Wärtsilä Capital Markets Day1 © Wärtsilä

STRATEGIC ROADMAPOLE JOHANSSON, PRESIDENT & CEO


Outlook 2008

• Orderbook for 2008 solid• Service growth continues

• Power plants market active

• Economic uncertainty continues• Ship orders down

• Power Plants financing?

Guidance for 2008 reiterated

+/- High level of activity and capacity constraints continue


Outlook 2009

• Orderbook for 2009 approx. 3,800 MEUR

• Service continues to grow by10-15%

• Supplier capacity in place

• Raw material and componentprices peaked

• Financial constraints may trigger cancellations and/or postpone-ments

• Supplier strength requires monitoring

• Slower economic activity mayaffect shipping and marineservices

2009 net sales estimated to grow 10-20%


SHIPPOWER

POWERPLANTS

SERVICES

Balanced portfolio for continued growth


Shipbuilding Trends: Shipyards’ perspective

0

100

200

300

400

500

600

700

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Contracts Size of Orderbook

Million DWT

Orderbook and Contracting

Source: Clarkson Research Services


Shipbuilding Trends: Shipyards’ perspective

0

25

50

75

100

125

150

175

200

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Historical Scheduled according to Orderbook

Million DWT

Deliveries



0 50 100 150 200 250 300 350 400

Cruise

Ferry

RoRo

Vehicle

Container

Other dry

General cargo

Bulker

Other tanker

LNG

LPG

Pure Chemical

Chemical/Products

Products

Crude

Shipbuilding trends: Owners’ perspective

Fleet Orderbook

Million Gt

Orderbook and share of fleet, MGt

Source: SAI, The Institute of Shipping Analysis

41%

50%

47%

56%

27%

44%

23%

67%

21%

8%

51%

43%

18%

10%

28%


Shipbuilding trends: Owners’ perspective

510.00

610.00

710.00

810.00

910.00

1,010.00

1,110.00

1,210.00

1,310.00

1,410.00

1,510.00

10/80 10/82 10/84 10/86 10/88 10/90 10/92 10/94 10/96 10/98 10/00 10/02 10/04 10/06

$/DWT

Average Newbuilding Prices $/DWT



Ship Power’s Competitive Edge

A highly diversified customer base

Strong product portfolio

A true lifecycle service provider: from pre-design and sales to delivery, commissioning and after-sales services

Strong on total efficiency:energy, operational, environmental and safety efficiency


Merchant OffshoreCruise

and FerryNavy

SpecialVessels

Wärtsilä Ship Power’s offering covers all key segmen ts


Ship Power’s Competitive Edge

Power distribution

Powerdrives

Automation PropulsionEngines Seals & bearings

Special vessels

Merchant

Offshore

Navy

Cruise & Ferry

Segment specific• Concepts• Applications• Project execution models• System integration

capabilities• Engineering services• Third party supplies

R&D

Ship design

Productengineering

Strategic purchasing

Wärtsilä components


Ship Design is key to early entry and full lifecycl e presence

BUILDOPERATE

Wärtsilä’s envisagedlifecycle entry point

Wärtsilä’shistoricallifecycleentry point

DESIGN


Owners demanding environmentally sound solutions

Environmental awareness and regulations call for:• Solutions to reduce emissions (SOx, NOx, CO2 and PM)• Alternatives to HFO: gas, biofuels, fuel cells• Flexibility in fuel usage: dual fuel • Solutions to maximize efficiency of components• Optimization of vessel design


World electricity consumption

10000

12000

14000

16000

18000

20000

22000

1991 1992 1993 1994 1995 1996 1997 1998 2000 2001 2002 2003 2004 2005 2006 2007

Actual Trend

TWh

World Electricity Generation


Flexible baseload

48%

Industrial self-generation18%

Oil & gas2%

Power Plants order intake by application

0

200

400

600

800

1000

1200

1400

1600

1800

2004 2005 2006 2007 1-9/2008

MEUR

Gridstability & peaking32%

Oil61%

Gas36%

Renewable3%


Power plant business outlook

• Domestic consumption should continue to grow

• Industrial sector demand may decrease

+/- Population growth, rising living standards andsubstitution should keep electricity demand growing

Electricity demand and economic growth correlate almost 1:1


Wärtsilä’s competitive advantages

• Flexibility of– Fuels– Plants sizing, modularity– Operation mode– Delivery scope incl. EPC– Operation & Maintenance support

• High product efficiency and reliability• Global presence and experience

from developing world


Custom

er Relationship

Managem

ent

Training Services

Reconditioning Services

Operations & Management

Propulsion Services

Automation Services

Engine Services

Ship Services

Boiler Services

Custom

ers

Value to customer’s business

We become the most valued business partner…

… by understanding Customers’ needs andassembling the appropriate solution to solve them.

ICEDenmark, 2008

Marine PropellerSouth Africa, 2007

Decam BVThe Netherlands, 2004

Deutz AGGermany, 2005

Total AutomationSingapore, 2006

McCall PropellerUnited Kingdom, 2007


Acquisitions & Joint Ventures

Marine Propeller LtdSouth AfricaSenitec AB

SwedenMcCall Propeller Ltd

United KingdomElectrical PowerEngineering LtdUnited Kingdom

Stockholmsfartygreparationer ABSwedenINTEC Injectortechnic GmbHGermanyWärtsilä BLRT ServicesKlaipeda UAB (JV)LithuaniaTotal Automation LtdSingapore

JMC Marine A/SDenmark

CGL Industries LtdCanada

MetalockSingapore Ltd

Singapore

Decam B.V.Netherlands

Elco Systems B.VNetherlands

Gerhardt Holding Co.USA

DEUTZ AG.Germany

Wärtsilä BLRTBaltica (JV)

Estonia

Caltax MarineDiesel BV

NetherlandsCiserv ABSweden

International CombustionEngineering A/SDenmark, DubaiClaus D. ChristophelMess- und Regeltechnik GmbHGermany

MaritimeService ASNorwayNavelec SASLe Havre,France

2001 2002 2003 2004 2005 2006 2007 2008


We are continuously developing our Services network

70 countries � > 160 locations � > 10’000 people � > 7’000 field service forces

0-100

300-500+

100-300

Manpower densityper country


AMERICAS EUROPE & AFRICA ASIA & MIDDLE EAST

300-500+

100-300

0-100

We are continuously developing our Services networkN

umbe

r of

Fie

ld S

ervi

ce p

erso

nnel

per

cou

ntry

70 countries � > 160 locations � > 10’000 people � > 7’000 field service forces


SHIPPOWER

POWERPLANTS

SERVICES

Mission

”We provide lifecycle power solutions

to enhance the business of our customers, whilst creating better

technologies that benefit both the

customer and the environment.

Wärtsilä Industial Operations - a flexible provider o f products


0

1000

2000

3000

4000

5000

6000

7000

2001 2002 2003 2004 2005 2006 2007 1-9/2008

Power PlantsShip Power Full-year estimate

MW

Delivered engine megawatts from own factories


Capacity utilization alternative - What if?

Services Retrofit Power Plants Ship Power Lost

Engine, % Propulsion, %

As-is Could-Be As-is Could-Be


Interchangeability between Marine and Power plant e ngine

Cost %

Sales phase4-7 mo

1-2 mo

Time

Bill of Material

Ex Works Delivery

Configurationfrozen


Competitive landscape is changing

• Performance requirements increase

• Complexity of installations increase

• Uncertainty about fuel price supports engine solutions

• Quality services in high demand

Competition adding engine andpropeller capacity

• Hyundai

• MAN• Rolls Royce

Services competition increasing

• Himsen / Goltens

• MAN investments

Pres1 OleJohansson CMD

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