IMI Severe Service - IMI plc
IMI Severe Service - IMI plc
IMI Severe Service - IMI plc
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Agenda• Welcome and introductions• What is <strong>Severe</strong> <strong>Service</strong>?• About <strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong>• Market and competitive landscape• Growth strategy
What is <strong>Severe</strong> <strong>Service</strong>?
<strong>Severe</strong> <strong>Service</strong>: ControlControl of steam flow througha turbine in a power stationControl of gas flow through a gasprocessing plant
<strong>Severe</strong> <strong>Service</strong>: IsolationEmergency shutdown of gasflow into a LNG plantShut-off of gas flow in a highintegrity pressure protectionsystem (HIPPS)
<strong>Severe</strong> <strong>Service</strong>: CharacteristicsCost of failure is many times the cost of the solution• High pressure drop• High velocity flow control• Extreme temperatures/cryogenics• Fine control requirements• Tight shut-off• Corrosive/erosive environments• Nuclear applications• Operational reliability• Safety critical/emergency shutdown• An engineered solutionincorporating high levels ofperformance and reliability
<strong>Severe</strong> <strong>Service</strong> – putting it in contextAverage house tapPressure: 50 psiHoover Dam300 psi<strong>Severe</strong> <strong>Service</strong>control valveUp to 15,000 psi
<strong>Severe</strong> <strong>Service</strong> – Top of the Pyramid<strong>Severe</strong> <strong>Service</strong>Applications andTechnologies~$3bnGeneral <strong>Service</strong>Applications and~$22bnTechnologiesSource: McIlvaine, PMSI, ARC, <strong>IMI</strong> estimates – Oil/Gas, Power and Petrochem only – excludes <strong>Service</strong>
<strong>Severe</strong> <strong>Service</strong>Not all <strong>Severe</strong> <strong>Service</strong> valves are the same …CavitationErosionPhotographs of competitors’ products
About <strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong>
<strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong> today• Leader in severe service solutions• Serving major customers in the global energy and power markets• Over 2,000 dedicated employees worldwide• Global manufacturing, sales and support capability• Emerging market focus• Unrivalled reputation for aftermarket support• Experienced and talented management team• Heroically, customer focused cultureStrong growth orientation with potential for strategic development
<strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong> – 2006 segmentationIndustry<strong>Service</strong>29%Fossil power20%GeographyAsia-Pacific36%Americas21%Industrial/other14%Oil & gas20%Nuclear power17%EMEA43%
<strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong> – Our journey1971B&Wacquires CCI1981<strong>IMI</strong>acquires CCI1997Sulzer valves2002STI2003Fluid Kineticsand HerionValves2006Truflo<strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong>1961Founded19791967Bailey ValvesCCI Patents theDRAG ® valve1992Dikkers nuclearvalves2001BTG valves2005ABB Japan ControlValves; 100% of CCIKorea; Shanghai CCI JVformed
Foundations of our success …Committed people everywhere
Foundations of our success …Direct relationship with the marketOEMEPCClient“Partner” “Customer” “End User”Oil & GasPowerIntegrationPrice, eng support,project executionLife cycle op cost,service
Foundations of our success …The Valve Doctor ® CCI Valve Doctors• Our best engineering talent• Strong application knowledge• Great, personal customer relationships• Keep us “ahead of the game” in termsof innovation and technology• Focus on results for the end-user –“Plant Betterment”• Our most experienced valve engineers:– 40 Valve Doctors– 9 countries– >600 years combined experience
Foundations of our success …Proven technology• Track record of solving severe service problems in over 4,500 plantsworldwide• Recognised as leader in custom engineered solutions• Focus on engineering leadership and innovation
Foundations of our success …Global service and operations capability
Market and competitive landscape
<strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong>: Oil & gasBillion US$1516 161720 21 2021.522232007 2008 2007 2008 2007 2008 2007 2008 2007 2008Source: BP, EIA• Oil majors are investing record CAPEX in exploration and productionto sustain the demand for energy and supported by high oil prices• 2007 CAPEX expenditure will exceed $280 + billion dollars• CAPEX is a leading indicator for <strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong>, but that is notthe whole story …
<strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong>: Oil and gasFocused on upstream gas production and midstream LNG/GTL chain
<strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong>: Oil and gasBn m 3 /year5,000Gas production$bn35Global LNG Capex4,00030253,000202,000151,00010502004 05 06 07 08 09 2010 2015 2020 202502002 2003 2004 2005 2006 2007 2008 2009 2010 2011Source: Douglas WestwoodSource: Douglas Westwood• Gas production projected to grow; primarily driven by demand forelectricity generation• Mid-term, greater proportion of gas will be transported by LNG forgeo-political reasons• Longer term clean coal processes and nuclear will impact demandfor LNG, especially from US and China
<strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong>: Fossil and nuclear powerGigawatts5,0004,0003,0002,0001,0000Global fossil-powered electricitygenerating capacity2003 2010 2015 2020 2025 2030Source: EIARussiaIndiaChinaBulgariaTaiw anUkraineArgentinaFinlandIranJapanKoreaPakistanRomaniaNuclear reactorsunder construction(April 18th, 2007)0 1 2 3 4 5 6 7Source: IAEA• Fossil generating capacity projected to grow steadily; driven byenergy demand in China and India• Environmental considerations will come to the fore, drivinginvestment in clean coal and CO 2 capture with re-injection• 31 nuclear plants under construction currently as part of upgradeand expansion of 443 units operating today
<strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong>: Competitive landscape#1 or #2 in markets we serve<strong>Severe</strong> <strong>Service</strong>: ControlPowerOil and Gas<strong>Severe</strong> <strong>Service</strong>: IsolationPower/O&G*Nuclear* Tri-X technology
Growth strategy
Growth Strategy: <strong>Severe</strong> <strong>Service</strong> SolutionsSeveral avenues for organic and strategic growthLeverage existingproducts, marketsand servicesEmerging marketfocusIncreaseapplication scopewith new productsand technologiesEnter newapplication areas,eg subsea,downstream<strong>Severe</strong> <strong>Service</strong>Solutions
Growth Strategy: <strong>Severe</strong> <strong>Service</strong> SolutionsFrom product provider to system integrator<strong>Severe</strong> <strong>Service</strong> SolutionsValves Actuation ControlIncreasing end-user influence
Growth Strategy: ExecutionBusinessDevelopment• Leveraging existing markets• HIPPS systems• Emerging markets focus• Acquisition of TrufloProcessExcellence• Global supply chain• Low cost procurement• New facility in India• Support center in IndiaInnovation• Dedicated R&D group• New chokes and actuationOrganisationCapability• Regional leadership• Leverage future acquisitions• World class leadership team
<strong>IMI</strong> <strong>Severe</strong> <strong>Service</strong> – In summary• Excellent <strong>IMI</strong> platform business• Positioned for profitable growth• Exposure to buoyant, global energy markets• Direct relationship with the partners, customers and end-users• Significant recurring aftermarket and service revenues• Strategic development potential• High proprietary, engineering content• Experienced, committed and talented teamDelivering on our commitments; developing the business
Focus presentationsOil & gas roomOil & gasLNG (Orton)Power roomNuclearFossil powerTechnology roomTechnology / InnovationCustomer <strong>Service</strong>
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