Wartsila Oyj Abp Q1 2023 Earnings Presentation Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Antti Kansanen - SEB, Research Division - Analyst : My question would be on the power plant side. And I mean, you have flagged a quite similar, let's say, mid- to long-term growth outlook for the balancing power as you have with the storage. But obviously, kind of the near-term growth is very different across the two businesses. So could you talk a little bit about the power plant balancing side? What is kind of curtailing the growth at the moment? And perhaps what is needed for the strong double-digit growth to come through on that market, please?

Question: Antti Kansanen - SEB, Research Division - Analyst : And I mean, you mentioned Asia and Europe specifically, but not the U.S. in kind of postponing decision-making. Am I reading this that you're perhaps expecting something larger from that market going into back half of this year?

Question: Tomi Markus Railo - DNB Markets, Research Division - Analyst : Yes, it's Tomi. Can you hear me?

Question: Tomi Markus Railo - DNB Markets, Research Division - Analyst : One of my questions was asked, but I would ask on price increases. Have you continued to do price increases in the beginning of the year and continue to do in the later quarters?

Question: Erkki Vesola - Inderes Oyj, Research Division - Analyst : Sorry, Hakan, can you hear me?

Question: Erkki Vesola - Inderes Oyj, Research Division - Analyst : Okay, okay. Very good. You previously talked about the uncertainty in your power plant engine delivery capability in the second half of this year, depending on order timing, et cetera. Can you give us any update on that front? Have the risks been raised? Or are they still the same? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 25, 2023 / 7:30AM, WRT1V.HE - Q1 2023 Wartsila Oyj Abp Earnings Presentation

Question: Antti Kansanen - SEB, Research Division - Analyst : Yes. Maybe coming back to the services growth, and as you mentioned, I mean, this quarter, it was mainly driven by agreements and then on projects, especially on the Marine side. So talk a little bit about the projects. What are you actually kind of -- what is the demand, both on Energy and Marine that you're getting right now? Is this sustained? Is there a cyclical element? Is this somehow to do with long lead times on the equipment side? So maybe expand on all of that, please?

Question: Antti Kansanen - SEB, Research Division - Analyst : And sorry, just a clarification. Was this a comment on your sales that you can deliver more or comment on orders that you're getting some of the pent-up demand now?

Question: Antti Kansanen - SEB, Research Division - Analyst : All right. Very clear. If I can ask a second question. It's kind of coming back to the storage profitability, and you won't probably give a numerical answer on this. But if we just think about your pricing on new orders, it's really starting to improve last year from second quarter onwards. So is it a fair assumption that your gross margin and earnings leverage would also start to improve now going into Q2 this year and onwards, just assuming lead times are up to one year or so on that business? Is that a good assumption for the margin development?

Question: Antti Kansanen - SEB, Research Division - Analyst : Yes, for sure. But I mean, we've been dealing -- or you've been dealing with this kind of a legacy bad projects for -- since then. I'm assuming storage is probably not the worst of those. But I guess, it's included in that as well.