Spirax-Sarco Engineering plc Capital Markets Day Friday 11 th - - PowerPoint PPT Presentation

Spirax-Sarco Engineering plc Capital Markets Day

Friday 11th September

Nick Anderson

Group Chief Executive

Spirax-Sarco Engineering plc

3

Agenda

“Doing better what we already do well.”

• Welcome from Nick Anderson (Group Chief Executive)
• Presentation by Jay Whalen (President of WMFTG)
• Presentation by Simon Nicholson (Managing Director, Watson-Marlow Ltd)
• Site tour

Lunch

• Presentation by Richard Green (Group Product Manager, WMFTG)
• Presentation by Rachel Pallett (Sales and Marketing Director, EME, WMFTG)
• Presentation by Ian Farnworth (Group Supply Chain Director, SxS)
• Presentation by Sheldon Banks (Divisional Director for the Americas, SxS)
• Round up and Q&A, Nick Anderson

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1) Increase direct sales effectiveness through sector focus 2) Develop the knowledge and skills of our expert sales and service teams 3) Broaden our global presence 4) Leverage R&D investments 5) Optimise supply chain effectiveness 6) Operate sustainably and help improve our customers’ sustainability

To deliver self-generated growth outperforming our markets

Doing better what we already do well

Our strategy

5

Our strategy

Objective: self-generated growth that outperforms our markets Focus: doing better what we already do well Our six-part Group strategy reflects the key elements of the Spirax Sarco steam business strategy, the Watson-Marlow Fluid Technology Group strategy and the Group acquisitions strategy:

• To be the world leader in steam

and thermal energy solutions

• Intensify customer focus through

enhanced customer value propositions

• Focus on priority industries
• Increased R&D effectiveness
• Global excellence in supply chain
• Competitive advantage through

enhanced knowledge and skills

Spirax Sarco

Eight strategic thrusts

• 1. Grow end user sales in Food & Beverage and

Healthcare

• 2. Grow sales in OPC and Chemicals
• 3. Grow sales in OEM’s
• 4. Early entry to attractive geographic markets
• 5. Grow sales of Thermal Energy Management

and Controls products

• 6. Global excellence in Supply Chain
• 7. Launch the right products to market faster
• 8. Develop knowledge and skills

6

Our strategy

Objective: self-generated growth that outperforms our markets Focus: doing better what we already do well Our six-part Group strategy reflects the key elements of the Spirax Sarco steam business strategy, the Watson-Marlow Fluid Technology Group strategy and the Group acquisitions strategy:

• To be the world leader in steam

and thermal energy solutions

• Intensify customer focus through

enhanced customer value propositions

• Focus on priority industries
• Increased R&D effectiveness
• Global excellence in supply chain
• Competitive advantage through

enhanced knowledge and skills

• Enhance market sector sales

focus

• Achieve rapid geographical

expansion

• Accelerate development of

breakthrough products

• Attain excellence in

manufacturing

• Selective product and market

sector diversification

Watson-Marlow

Spirax Sarco

• To create significant

shareholder value through supplementing organic growth

• Expand the capabilities of our

niche businesses through new technologies, skills or geographic coverage

• Increase our addressable

market into adjacent related sectors

Acquisitions

8

Summary: strategy implementation

“Doing better what we already do well”

• Strategy implementation is delivered through the execution of

selected projects across whole organisation

• Governed by a Strategy Steering team focused on driving

transformational projects

• Supported by dedicated Strategy Implementation team

including regional programme managers

• Strategy deployment tool (Hoshin Kanri) used to cascade the

strategy across the Group and align all business units

• Engaging multiple levels across the global organisation

Accelerating growth and adding value for the long term

7

Watson-Marlow Fluid Technology Group

Jay Whalen

Executive Director President, Watson-Marlow Fluid Technology Group

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Watson-Marlow Fluid Technology Group

Eight brands

Low-flow peristaltic metering pumps (joined SSE plc in 1990) Precision pump and transfer tubing High-flow industrial hose pumps (acquired 1996) Low-flow, high precision OEM pumps (acquired 2000) Aseptic filling (acquired 2008) Sinusoidal pumps (acquired 2009) Biopharm tubing connection systems (acquired 2014) Stainless steel tank bottom and in-line valves for biopharm (acquired 2015)

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In a peristaltic pump, a flexible tube is occluded and fluid is driven through the pump by rollers or shoes. Restitution of the tubing draws in fresh fluid.

Peristaltic pump

How it works

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Peristaltic pump

Value proposition

The pump does not touch the fluid

Making peristaltic pumps perfect for clean fluids which must not be contaminated – biopharm & pharmaceuticals, and food & beverage applications. A sterile tube makes a sterile pump.

The fluid does not touch the pump

Making peristaltic pumps equally suitable for dirty fluids which contaminate other pumps – slurries, pigments, effluent applications. No need to strip or clean the pump; a new tube makes a new pump.

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• Simple single shaft and single rotor design
• Symmetrical sinusoidal pumping chambers provide

positive displacement of product. As one chamber discharges the other fills

• A gate shuttles back and forth along the rotor

separating the suction chamber from the discharge, preventing fluid slip

• Large pumping chambers eliminate product

compression and damage to large solids

MasoSine pump

How it works

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Fits perfectly in gap between hygienic Watson-Marlow pumps and higher pressure Bredel pumps

• Higher flow rates
• Higher viscosities
• Higher pressures
• Non-lubricated
• Gentle pumping
• Simple maintenance
• Targets rotary lobe pumps
• Strengthens product portfolio
• Doubled share of food & beverage market

MasoSine pump

Value proposition

14

The connection between Watson-Marlow pumps and Watson-Marlow tubing in biopharm single use aseptic process

• “Single-use” is a growing trend

within the growing biotechnology sector

• Peristaltic pumps and tubing are

perfect for single-use

• BioPure add the aseptic connection

systems and enable the manufacture of single use assemblies

BioPure connection systems

Value proposition

BioClamp BioBarb BioValve

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Asepco stainless steel valves

Value proposition

Asepco radial valves deliver purity and reliability

• Radial valves’ ability to drain and clean

simplifies batch to batch changeovers

• Less risk of contamination of the

customer’s high value product

• Validation of the cleaning routine is

paramount, and the simpler Asepco design fits to that well

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Five core strategies

• Market sector sales focus
• Rapid geographical expansion
• Accelerate development of breakthrough products
• Excellence in manufacturing
• Selective product and market sector diversification

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Water and wastewater

Abrasion-resistant pumping of solids- laden fluids. Accurate and controllable chemical metering.

Food and beverage

Accurate, repeatable dosing with low- shear pumping

• action. No damage

to solids and soft

• fruit. Clean in place

and steam in place. MasoSine: gentle, low shear, viscous.

Biotech and pharmaceuticals

Sterile pumping, filling, transfer tubing and connections. Applications include fermentation, filtration, aseptic filling and tablet coating.

Industrial and chemicals

Wide chemical compatibility, flow rate ranges and control options. Ease of use ensures rapid acceptance by operators.

Mining

Rugged pumps required to reliably handle aggressive flocculent chemicals and abrasive slurries 24/7.

Fluid path technology for process industries

Strategy: market sector sales focus

18 Biopharmaceutical Industrial Environmental Food & Beverage Medical Mining Other

Sales by market sector

Strategy: market sector sales focus

35% BioPharm/Pharmaceutical

Mainly Watson-Marlow pumps and tubing, and Flexicon filling. Boost from Biopure

20% Industrial General industrial markets slow 12% Water & Wastewater

Environmental recovering in 2014

11% Food & Beverage

MasoSine and Watson-Marlow

8% Mining

All Watson-Marlow and Bredel. Stabilized in 2014

6% Medical & Clinical Diagnostic

Watson-Marlow and Alitea OEM route to market accounts for 21% of sales

2014 Sales

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Direct sales operation > 3yrs Direct sales operations < 3yrs Direct operations planned 2015/16

• Greater understanding of

customers’ processes

• Greater support to end customers
• Knowledge-based, close

relationship with customers

• Watson-Marlow actively

converting 3rd party distribution to direct sales

Rapid geographical expansion

Strategy: rapid geographical expansion

Direct sales operations driven by market sector focus:

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2014 new and emerging markets

Strategy: rapid geographical expansion

In 2014 18% of sales from emerging markets (2013: 19%)

Americas 44%

(2013: 44%)

Emerging markets 8% (2013: 9%)

EMEA 44%

(2013: 44%)

Emerging markets 2% (2013: 3%)

Asia Pacific 12%

(2013: 12%)

Emerging markets 8% (2013: 7%)

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AOD (air-operated diaphragm) pumps Wilden and Warren Rupp – mainly industrial and printing Peristaltic hose pumps Verder, Abaque, Boyser and PCM Delasco – mainly water treatment and mining Progressive Cavity pumps Moyno, Mono and Allweiler – mainly food & beverage, water treatment, mining Industrial lobe pumps and circumferential piston pumps Johnson, Waukesha and Alfa-Laval

Competition

Sanitary lobe pumps Waukesha, ITT Jabsco and Fristam – mainly food and beverage, pharmaceutical and cosmetics Peristaltic metering and OEM pumps Masterflex and Verder – laboratory and industrial. Chinese knockoffs Solenoid diaphragm pumps Prominent, Alldos, Grundfos and LMI – mainly water treatment Mechanical diaphragm pumps Pulsafeeder and Bran+Luebbe – mainly chemical dosing

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Breakthrough products

Strategy: accelerate development of breakthrough products

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• Watson-Marlow Qdos – totally new peristaltic metering pump to directly

target solenoid diaphragm pumps in water & wastewater, mining and general chemical/industrial sectors. Qdos30 now joined by Qdos60

• Bredel Apex – mid range hose pump capable of 7 bar. Ideal for general

industrial areas. In five sizes from 275 litres per hour to 6,200 litres per hour

• Single Use Assemblies – Single-use tubing assemblies for the growing

biopharmaceutical market

• AMP Pump – Chinese manufactured entry level peristaltic pump for the

Asian market

Innovative product development

Strategy: accelerate development of breakthrough products

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Our smallest pump, at its lowest speed, would take nearly 13,000 years to pump what the largest pump can pump in one minute

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Addressable market size 2014

£138m £622m

WMFTG 18% Other 82%

Total addressable market, 2014 - £760m

• Acquisitions
• Product development

Market size

£760m

Asepco adds £11m addressable market in 2015

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Our factories – centre of excellence

Strategy: excellence in manufacturing

• Each factory is a centre of excellence for its own particular part of the product range
• Improvement driven by the Global Excellence in Manufacturing program (GEM)
• All factories accredited to ISO 9001 and seven of eight to ISO 14001

Asepco Mountain View, USA BioPure Portsmouth, UK Watson-Marlow Tubing Falmouth, UK Watson-Marlow Pumps Falmouth, UK Bredel Hose Pumps Delden, Netherlands MasoSine Pumps Ilsfeld, Germany Flexicon Filling Systems Ringsted, Denmark Alitea OEM Pumps Stockholm, Sweden

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Leveraging growth

Strategy: selective product and market sector diversification

• Expanding our product portfolio and addressable market, to leverage growth

Acquisitions: Flexicon – aseptic filling (2008) MasoSine – sinusoidal pumps for food and beverage (2009) BioPure – aseptic tubing connection systems and assemblies (2014) Asepco – stainless steel aseptic valves for biopharm (2015) Product: Qdos – peristaltic metering pump range targeting industrial process

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• Consistent revenue growth
• Consistent profit growth
• Expanding market share
• Expanding sales footprint
• Excellence in manufacture
• Breakthrough product development
• Expanding addressable market
• Niche related fluid path acquisitions

A market leader in positive displacement pumps and related fluid path equipment

Watson-Marlow Fluid Technology Group

Watson-Marlow Fluid Technology Group

Simon Nicholson

Managing Director Watson-Marlow Pumps & Tubing

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Falmouth facility

Heritage and scale

• Watson-Marlow started in Marlow, Bucks in 1956
• Relocated to Falmouth in 1969 with 12 people
• Now on 3 sites employing over 280 people
• Manufacture annually 125,000 pump heads, 15,000 pump drives, 140,000

elements and 12,000 km of tubing

• Process 35,000 Sales Orders lines, despatched to 70 destinations globally
• ISO 9001, ISO 14001, OHSAS 18001 accredited

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Watson-Marlow Pumps and Tubing

Products / core competences

Design and manufacture

• Peristaltic pumps with flow rates 0.6ml/min to 8,000 litres/hour
• Tubing and elements in bore sizes 0.13mm to 25.4mm

Providing WMFTG with core competences

• Make-To-Order assembly capability
• Precision machining of critical pump / element components
• Tubing extrusion within “Good Manufacturing Practice”

compliant cleanrooms

• New Product Development of mechanical/electronic

technology platforms

32

Supply strategy

Excellence in manufacturing and global process

1. Utilise - Global Excellence in Manufacturing (GEM) 2. Strengthen - Make-to-Order (MTO) 3. Invest in - Global IT solutions (ERP)

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Global Excellence in Manufacturing

GEM core principles

• Our way of working
• Our operating system
• A philosophy we believe in
• The right way to manage our
• perations and daily work

34

Global Excellence in Manufacturing

How GEM delivers

Since GEM introduced in 2012

• £1m savings to P&L
• 7,500 hours savings added to capacity

35

Global Excellence in Manufacturing

313/314 Pumpsroller press automation

• 500 hours labour saving in 2015 provides

extra capacity

• From 3 hours to 20 mins to assemble

1,000 rollers, with added mistake proofing Tubing tooling set-up reduction

• £6k benefit to P&L in 2015

through material saving

• Reduced setup 25% downtime

provides extra capacity and changeover flexibility

How GEM works

Bright Idea Management Review GEM project Labour/cost savings P&L benefit

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Excellence in global process

Make-to-Order (MTO)

• Modular design allows late configuration/flexibility
• Assembly cells build customer specific product
• Daily shipments to the sales companies
• No finished stock of pumps or drives at Falmouth
• Minimal stock held at sales companies
• MTO reduced Order to Despatch process from

20 days to 2 days

37

Excellence in global process

Global IT solutions (ERP)

• WMFTG is deploying a global ERP solution
• Sales companies enter customer orders directly
• Inter-company orders sent automatically
• Manufacturing requirement appears in real time
• Interfaces with global freight suppliers to allow

automatic despatch data/tracking

• Global ERP solution to reduce Order to Despatch

process from 2 days to 1 day

Watson-Marlow Fluid Technology Group

Richard Green

Group Product Manager

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New Product Development

Agenda

New Product Development strategy What we have achieved so far Key breakthrough products in the pipeline Continuous improvement in process Closing comments

40

New Product Development

Our strategy

Accelerate the development of breakthrough products We will invest in new product development to grow the performance envelope of our niche peristaltic and sinusoidal pumps, and associated fluid path technologies to gain market share against our competitors, whilst expanding our addressable market and market sector

• penetration. Continual development of our product

range will also focus on value engineering and cost reduction.

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New Product Development

Already achieved

• Two central themes:
• Growth into key market sectors by increasing

addressable market

• Improving competitiveness and efficiency

through value engineering and cost reduction

• Group Product Management carry out portfolio

planning: selecting the right projects to align with strategy

• Individual projects commissioned through factory

based NPD teams

• Several successful breakthrough products already in

the market

42

New Product Development

Recent breakthrough products in the market

120 cased pumps Sector based development Updated product platform Market share increase IN pumps Improving competitiveness Designed for Chinese manufacture Just launched Qdos metering pumps Sector based development Expanding addressable market by opening up the performance envelope APEX hose pumps Improving competitiveness Product positioning exercise, increasing market share

43

New Product Development

Breakthrough product development in progress

Objectives

• Continue growth into chemical metering
• Own the fluid path in biopharm, capitalise on growth of

single-use systems

• Be the pump of choice in food and beverage process
• How we are achieving objectives:
• Increasing performance
• Expanding addressable market
• Sector based sales teams with value propositions specific

to their market

44

New Product Development

NPD excellence – continuous improvement programme

Improving NPD efficiency

• New group-wide NPD-specific project management

process

• Honing group-wide project governance
• Reducing time-to-market: retaining core IP expertise

at the factories, but investing in targeted bandwidth

• Clarifying development direction and visibility
• Roadmapping: viewing planning over a longer

horizon

• Rapid assimilation of acquisitions into the Group

NPD process – e.g. Asepco

45

New Product Development

Accelerating the development of breakthrough products

Conclusions

• A clear strategy
• Focused on increasing market share and addressable market
• Focused on improving competitiveness
• Several breakthrough products launched in the past few years
• Exciting breakthrough products in development for 2016
• Continuous focus on improving process, efficiency and time-to-market within

the New Product Development process …to accelerate the product development of breakthrough products

Watson-Marlow Fluid Technology Group

Rachel Pallett

Sales and Marketing Director, EME

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• B Eng

Electronic Engineering, Imperial College London

• 1991

Renishaw plc (held engineering, sales, business development and general management roles)

• 2008

Independent consultancy (learning, leadership)

• 2010

Joined WM Ltd as UK Sales Manager

• 2011

Appointed European Sales Manager

• 2013

Appointed Sales & Marketing Director - EME

Rachel Pallett - background

48

WMFTG regional sales structure

Americas Asia-Pacific and sub-Saharan Africa Europe, Russia, Middle East + North Africa

49

3 new direct sales companies

Moscow, Russia Warsaw, Poland Vienna, Austria

Rapid geographical expansion of direct sales presence

EME regional activity over the past 5 years

23 distributor conversions

Watson-Marlow x 3 Bredel x 7 Flexicon x 4 MasoSine x 5 BioPure x 3 Asepco x 1

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• Roll-out of new AX ERP & CRM system
• 9 out of 12 EME sales companies now

‘live’ – Inter-company sales process with AX factories – Unified customer database,

• pportunity pipeline

– Improved scope for future efficiency savings

Process development in sales operations

51

• Sales team structure
• Product and application training
• Sales conferences
• Exhibitions, advertising, digital

marketing

• Business development

Sector focus in sales and marketing

52

Sector focus examples

Customer site ‘lunch and learn’ event

BioProducts Laboratory Ltd, UK

OEM e-book digital marketing campaign Achema 2015, Frankfurt

53

Cost savings calculator e-campaign industrial wastewater sector

Sector focus examples

Product brochures include testimonials to illustrate Customer Value Propositions Sales engineers trained to demonstrate value in sector specific applications

54

• Facilitate capturing ‘Voice of the Customer’
• Participate in NPD stakeholder reviews
• Identify trial sites and early adopters
• ‘Product champions’ accelerate sales growth

Sales involvement with NPD

Group Supply Chain, Spirax Sarco Steam Specialties

Ian Farnworth

Group Supply Chain Director, Spirax Sarco

56

Purpose

• 1. Introduce you to our Supply Chain
• 2. Current status and opportunity for improvement in our

Supply Chain

• 3. Key Supply Chain developments

57

Our Supply Chain encompasses all of the activities that transport and transform raw materials and components into a finished product that is delivered to the end customer.

• 1. Introduction to our Supply Chain

Supplier

Transport

Manufacturing

Transport

Operating Company

Transport

Customer

58

• 46 operating units in 41 countries
• Direct sales presence in 56 countries
• 8 (+1 in 2016) regional manufacturing

units

• Excluding UK & France: 80% +

supplied within region

• Direct sales model = distributor
• Short order book, 5-6 weeks
• Very wide product range
• Highly variable demand with low

visibility

• High availability requirement,

same/next day

• 1. Our Supply Chain

Requires a highly “agile” Supply Chain

59

Good performance but further

• pportunity in the Supply Chain:
• Delivery performance
• Inventory optimisation
• Planning operations
• Lead time & agility
• Purchasing co-ordination
• Operational efficiencies
• Manufacturing to Supply Chain

thinking

• Group synergy and leverage
• Knowledge sharing within the

Group

• 2. Current status & opportunity for improvement

Our metrics VOC: Our knowledge

Progress in these areas will support growth

60

• 3. Key Supply Chain developments

Customer First Thrust 6 objectives

Spirax is recognised as having an excellent product availability service throughout the world, as viewed by the customer Spirax Supply Chain achieves continuous improvement in efficiency

• 1. Planning
• 2. Agility
• 3. Efficiency

Time Now

OTTC deployment IQM deployment OTTR deployment Manufacturing planning : system development Manufacturing planning : talent development S&OP deployment

Activity aligned with growth requirement

61 Customer First Thrust 6 objectives

Spirax is recognised as having an excellent product availability service throughout the world, as viewed by the customer. Spirax Supply Chain achieves continuous improvement in efficiency

• 3. Key Supply Chain developments

Time Now

Activity aligned with growth requirement

• 1. Planning
• 2. Agility

Lead time programme: Kaizen events/projects within all manufacturing locations

• 3. Efficiency

Sectorisation in Supply Capex programme within manufacturing Lead time programme within manufacturing

62 Customer First Thrust 6 objectives

Spirax is recognised as having an excellent product availability service throughout the world, as viewed by the customer. Spirax Supply Chain achieves continuous improvement in efficiency

• 3. Key Supply Chain developments

Time Now

Activity aligned with growth requirement

• 1. Planning
• 2. Agility
• 3. Efficiency

Efficiency programme: Kaizen events/projects within all manufacturing locations Sourcing synergies Capex programme within manufacturing Efficiency programme within manufacturing

63

• 3. Other Group Supply Chain developments to

support

Direct Sales Model, Spirax Sarco Steam Specialties

Sheldon Banks

Divisional Director for the Americas, Spirax Sarco

65

Our operating company offering

Market leading products plus more …

Health & Safety Compliance Project Management Installation & Commissioning Service & Maintenance Training 24-Hour Priority Response Steam Trap Surveys & Management Steam System Audits

66

Direct sales model with a variety of supply options

Contractors End user Distributors Typical sales

• perating

company

Selling takes place here

OEMs Direct

How we supply

67

End customer relationship strength

Account Manager End Customer Buyer End Customer Buyer Account Manager

Supply Chain Supply Chain Engineering Engineering Projects Projects Product Experts Production Solutions Sustainability Supply Chain Engineering Projects Production Sustainability Supply Chain Engineering Projects Product Experts Solutions

Weak Connection Strong Connection

68

Our

SALESFORCE

is unique and a major investment

The Spirax Sarco brand is not just the products but also the people. The products and people together create brand loyalty.

Vs.

Competitor Field Sales Competitor #1 Competitor #2 Competitor #3 Competitor #4 Competitor #5 Competitor #6

Developing knowledge and skills

UK and ROI example

69

Loss of

STEAM

knowledge in the user base, direct contact essential

Customers no longer have the steam knowledge they once had nor the resources for engineering. Many customers do not understand what problems they have, let alone how to fix them.

Developing knowledge and skills

70

Solution

SELLING

focussed on VALUE for our Customers

Taking sales from a vendor to trusted advisor is well on the way as we become their steam engineers. How to Win Customer Value Proposition (CVP)

71

Challenges of

SUSTAINABLE

processes are a minefield for the customer, we help

Encircling the customer are a myriad of

• pportunities to develop a sustainable

business. Spirax Sarco guides clients to successful funding and technology as the industry steam leader.

Customer

CRC ROCs DEC RHI ESOS Clean Steam HTM 203 ECA L8 Legionella Climate Change Levy EU ETS

Developing knowledge and skills

72

Encourage

INNOVATION

that is driven from customer engagement and unmet needs

As a pioneer in the packaged system, Spirax Sarco sales lead the way on many fronts. Systems represent a growing share of the Company’s sales.

Launch the right products to market faster

73

Leverage

IP

in our databases as a means to win

A unique database of the installed steam plant and customer base. Unprecedented contact information with most of the key customers. Leveraging this information for sales growth is a formidable advantage.

>400,000 contacts >80,000 active customers We know the steam boiler population

Direct Sales Model

74

Customer

TRAINING

in Spirax Sarco is recognised as the industry standard

Direct contact with the customer has created long term, high value training support to our users for the lifetime of their systems. Training centres are seen as centres of excellence in a world where customer steam knowledge is diminishing.

From SME’s to Blue Chips

Direct Sales Model

75

Case Study

Spirax Sarco helps Kettering General Hospital secure funding for £250k energy saving project

Sectorisation

76

Case Study

Trap survey and replacement programme helps Texas refinery save $245,000 per annum

Sectorisation

77

Case Study

Spirax Sarco provides turnkey steam system for Europe’s largest printworks

Direct Sales Model

78

Case Study

Spirax Sarco helps cheese producer to upgrade plant with Clean Steam Generators

Sectorisation

79

energy savings, CO₂ savings, water savings, productivity improvements, quality improvements, cost reductions, regulatory compliance, effluent reduction, recovered product, safer working environment

Value created in many forms …

80

Summary

Reseller Contractor OEM End user

Spirax Sarco value

Direct Sales Model

Nick Anderson

Group Chief Executive

Spirax-Sarco Engineering plc

82

Our strategy

Objective: self-generated growth that outperforms our markets Focus: doing better what we already do well Our six-part Group strategy reflects the key elements of the Spirax Sarco steam business strategy, the Watson-Marlow Fluid Technology Group strategy and the Group acquisitions strategy:

• To be the world leader in steam

and thermal energy solutions

• Intensify customer focus through

enhanced customer value propositions

• Focus on priority industries
• Increased R&D effectiveness
• Global excellence in supply chain
• Competitive advantage through

enhanced knowledge and skills

• Enhance market sector sales

focus

• Achieve rapid geographical

expansion

• Accelerate development of

breakthrough products

• Attain excellence in

manufacturing

• Selective product and market

sector diversification

• To create significant

shareholder value through supplementing organic growth

• Expand the capabilities of our

niche businesses through new technologies, skills or geographic coverage

• Increase our addressable

market into adjacent related sectors

Watson-Marlow

Acquisitions Spirax Sarco

83

Summary: benefits

“Doing better what we already do well”

The Group strategy will:

• increase the effectiveness of our direct sales organisation
• leverage our strengths in key sectors
• capitalise on the most attractive opportunities
• expand our addressable markets
• align and direct resources more effectively
• improve business performance

Accelerating growth and adding value for the long term

84

Questions?