121016 investor presentation final

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<ol><li> 1. TOMRAINVESTORPRESENTATION TOMRA SYSTEMS ASA 19th October 2012 </li><li> 2. TOMRA was founded on an innovation in 1972that began with design, manufacturing and saleof reverse vending machines (RVMs) for automatedcollection of used beverage containers 2 </li><li> 3. Today, TOMRA creates sensor-based solutions foroptimal resource productivity helping our customersincrease their financial results and reduce theirenvironmental impact3 </li><li> 4. TOMRA has installations in over 80 marketsworldwide and had total revenue of ~3.7 billion*NOK in 2011TOMRA has ~2,200 employees and is publicly listedon the Oslo Stock Exchange* Excluding BEST4 </li><li> 5. The TOMRA Group continues to innovate andprovide cutting-edge solutions for optimal resourceproductivity within two main business areas:Collection Solutions (reverse vending, materialrecovery and compaction)Sorting Solutions (recycling, mining and food)5 </li><li> 6. A TINY BLUE AND GREEN OASIS OF LIFE INA COLD UNIVERSE. DAVID SUZUKI </li><li> 7. THE WORLD POPULATION AND STANDARDOF LIVING IS INCREASING DRAMATICALLY </li><li> 8. WORLD RESOURCES ARE UNDERUNPRECEDENTED PRESSURE </li><li> 9. RESOURCE PRODUCTIVITY MUST INCREASETO ENSURE SUSTAINABLE DEVELOPMENT </li><li> 10. THE DAWN OF THE RESOURCE REVOLUTIONSOURCE: McKinsey10 </li><li> 11. The resource revolution is abouttransforming how we obtain, use, and reuse resourcesfor sustainable economic growth and improved qualityof life for all. 11 </li><li> 12. At TOMRA we have always thought this way.From inventing the worlds first reverse vendingmachine in 1972 to providing the mostinnovative sensor-based sorting systems today. 12 </li><li> 13. TOMRA IS TRANSFORMING HOWWE OBTAIN OUR RESOURCES </li><li> 14. Our sorters can reduce water consumptionwith 3-4 cubic meters per ton oreOur sorters can reduce energy consumptionin mining by 15%Our sorters can increase recovery of valuableminerals by up to 25%14 </li><li> 15. TOMRA IS TRANSFORMING HOWWE USE OUR RESOURCES </li><li> 16. Our optical sorters can analyze 25 tons of product perhour, maximizing yield and recovery while reducingwaste, energy, and chemical useWe recover 5% - 10% of the produce, through higher yields andbetter utilization, reducing pressure on the food chainThats approximately 25,000 trucks per year in potatoes alone16 </li><li> 17. TOMRA IS TRANSFORMING HOWWE REUSE OUR RESOURCES </li><li> 18. 30 billion used beverage containers are every yearcaptured by our reverse vending machinesOur optical waste sorter can analyze and sort a footballstadium covered with waste in less than 15 minutes715,000 tons of metal is recovered every year byour metal recycling machinesOur vertical balers enable daily savings of ~20,000transport movements, 160,000 liters of fuel andup to 50% of customers waste handling costs 18 </li><li> 19. TOMRA CREATES SENSOR-BASED SOLUTIONS FOROPTIMAL RESOURCE PRODUCTIVITY </li><li> 20. Today we see more opportunities for optimalresource productivity than ever before20 </li><li> 21. WASTE INTO VALUE </li><li> 22. YIELD INTO USAGE </li><li> 23. SOURCE INTO RESOURCE </li><li> 24. PURPOSE INTO PROFITS </li><li> 25. PROFITS INTO PROGRESS </li><li> 26. TOMRA invests 8% of its yearly revenue in R&amp;D, toprogress and create solutions to move past the falsechoice between the earth and the economy 26 </li><li> 27. TOMRA: Leading the resource revolution 27 </li><li> 28. TOMRA IN SHORT </li><li> 29. THE TOMRA TRANSFORMATION JOURNEY 20002004 2008 2012FROM: TO:5%16% 40% 100% 95%84%60% Collection Collection CollectionA house ofCollectionA brandedbrands SortingSortingSortinghouse29 </li><li> 30. CREATING VALUE THROUGH TWO STRONG BUSINESSAREAS Sorting Solutions Two strong areas for value creationA larger part of TOMRA 40% 60% StableHigh growth High marginsHigh marginsCollection Sorting Low cyclicality Medium cyclicality High technology - sustainable businessSource: Rounded proforma figures after acquisition30 </li><li> 31. TOMRAS TWO BUSINESS AREAS*TOMRA Collection Solutions TOMRA Sorting Solutions Reverse Vending Machines RecyclingKey activities Sale and service of solutions for automated collection of used beverageHigh speed identifying, sorting and processing of information: containers with deposit in retail stores material, shape, size, color, defect, damage and location of objectsShare of 11 sales ~46% ~11%Employees960175CustomersGrocery retailersMaterial recovery facilities, scrap dealers, metal shredder operatorsMarket share~65%~50-60% Compaction MiningKey activities On of the worlds largest manufacturer The leading provider of sensor-based of vertical balers sorting systems for the mining industryShare of 11 sales ~4%~3%Employees75 50CustomersRetail, manufacturing industry, restaurant, catering &amp; hotel, warehouse &amp; distribution Mining companiesMarket share~15-20% in active markets ~40-60%Material Recovery FoodKey activities Pick-up, transportation and processing of used beverage containers and Optical sorting and processing operation of a network of collection sites in USAsolutions for foodShare of 11 sales ~13% Odenberg: ~7% (acquired in 2011) /BEST: ~16% (acquired in 2012)Employees400Odenberg: 175 / BEST: 310CustomersGrocery retailers and beverage manufacturers Food growers, packers and processorsMarket share~60% in USA (markets served)~25%* Proforma 2011 as if BEST should have been part of TOMRA31 </li><li> 32. TOMRA INSTALLED BASETOMRA Collection Solutions TOMRA Sorting Solutions INSTALLED UNITS INSTALLED UNITS INSTALLED UNITS INSTALLED UNITSINSTALLED UNITS INSTALLED UNITS Nordic~15,000 Nordic~16,000 Europe 1850 Europe70 Europe ~1,150 Europe ~1,950 Germany ~23,000 UK~17,000 Asia220 US / Canada 35 US/Canada ~1,350US/Canada~1,050 Other Europe~12,000 Other Europe~26,000 US / Canada 500 Australia 20 Asia ~120 Asia/Oceania ~330 Japan~500 Asia/Oceania ~4,000 Other 380 South Africa45 Other~100 South America ~120 North America ~15,000 North America~4,000 Other 20 Middle East/ ~350 South America ~1000 Middle East/Africa ~500Africa TOTAL ~67,000 TOTAL~67,500TOTAL 2,950 TOTAL 190TOTAL~2,720 TOTAL~3,80032 </li><li> 33. USING THE POWER OF BUSINESS TO DO GOOD EMPLOYEESETHICAL BUSINESS BEHAVIOUR 81% of our employees say Member of UN Global Compact TOMRA is a Great Place to since end 2009 Work Implementing ethicalpolicies worldwide ENVIRONMENT INCREASING CUSTOMER VALUES We contribute to avoided emissions of Productivity about ~10mill tons Revenues CO2 annually Quality33 </li><li> 34. TOMRA IN DEPTH </li><li> 35. TOMRA Collection Solutions 35 </li><li> 36. TOMRA REVERSE VENDING TRANSFORMING BEHAVIOR </li><li> 37. THE USED BEVERAGE CONTAINER RECYCLINGVALUE CHAINGeneric used beverage container (UBC) recycling value chainRVM-based UBC recycling value chain RVM SERVICE/ DATA ADMIN/ MATERIALMATERIAL MATERIAL MATERIALTECHNOLOGY SUPPORT CLEARINGPICK-UP PROCESSING BROKERAGE RECYCLING37 </li><li> 38. RVM PRODUCT PORTFOLIO38 </li><li> 39. RVM VALUE PROPOSITION RVMs reduce need for manual labour and willtypically have a payback period of 12-18Reduced costsmonths for medium sized stores Improved logistics and handling RVMs keep track of all deposit transactions in Germany alone the total transaction volume Clearing ofhas an annual value in excess of ~4 bn EURdeposits RVMs have several fraud detection features toprevent paying out deposit on non-eligiblecontainers RVMs make it convenient and easy forHighconsumers to return their empty containersconsumer convenience RVMs are clean and efficient and ensurecorrect redemption of containers39 </li><li> 40. MARKET STRUCTURES AND BUSINESS MODELS Mandatory Non-refillables account for 75% of all containers sold and are popular due to 1 (non-refillable) simplified distribution/manufacturing and consumer marketing aspects deposit markets Some markets have MANDATORY deposit systems to ensure proper collection ofcontainers RVMs are used to make these systems more effective and efficient Voluntary (refillable) Refillable containers account for ~25% of all containers sold and have traditionally 2 deposit marketsbeen used by local and regional breweries outside NA Refillable containers are typically part of a VOLUNTARY deposit system toincentivize consumers to return containers for reuse RVMs are used to make this system more effective and efficient Other incentive-based In markets without deposit there might still be a need to organize collection of 3 marketsempty containers, either to support overall recycling targets/ambitions or to (non-deposit)demonstrate corporate social responsibility Although the rationale for using RVMs varies from market to market, RVMs can ingeneral be used to facilitate the collection process 40 </li><li> 41. COMPETITIVE LANDSCAPEAnnual revenuefrom RVM&gt;65,000 Number of installed RVMs 10,000-20,000 2,500-5,00030Number of RVM marketsSource: TOMRA estimates and analysis 41 </li><li> 42. TOMRA COLLECTION: OUR STRATEGY1 Protect and defend Cost leadership existing business Increased differentiationSpur growth in Accelerated machine replacement2 existing markets Incremental revenue streams on installed base New deposit markets3 Succeed in new markets Viable non-deposit business models 42 </li><li> 43. COST LEADERSHIP AMBITION Overall ambition to reduce COGS on new RVMs by 40% from 2010 to 2015 20% by aggressive sourcing and production strategy 70% of sourcing from low-cost countries Flexible and quicker assembly close to main markets 15% by technology and design for low cost manufacturing Modularity building block principle Smarter design , e.g. combining processors and sensors 5% by other means New production techniques Automation Volume43 </li><li> 44. RECENT TOMRA INNOVATIONS T-820 TouchMultiPac SoftDrop MK3 Flake Setting new standards in Taking uptime to new levels Enabling simpler store Boosting operational uptime usability foroperations and logistical efficiency consumer, owner and operatorTOMRAPlus DMRDoublefeed A new management tool for Minimizing border fraud Customer-specific solution proactive admin of your issues in Michiganenabling space-efficient reverse vending systems operations 44 </li><li> 45. PRESENT AND PROSPECTIVE DEPOSIT SCHEMESCanadaEuropeSaskatchewanNorwayScotlandManitobaIceland SpainAlberta FinlandOntario SwedenNorthwest Territories Croatia Czech RepublicNunavut Germany MontenegroYukon Denmark SerbiaPrince Edward IslandNetherlands LithuaniaNova Scotia IsraelLatviaNew Brunswick EstoniaNewfoundlandQuebecUSA AustraliaCaliforniaFlorida Northern TerritoryOregonGeorgia South AustraliaConneticutNorth CarolinaNew YorkVirginiaGeneral AustraliaMassachusettesKentuckyVermont MissouriMaineHawaiiIowaMichigan States / provinces with a States / provinces in States / provinces in running deposit systemadvanced discussion Initial discussions 45 </li><li> 46. TOMRA Sorting Solutions46 </li><li> 47. STRONG REVENUE GROWTH SINCE INCEPTION IN 1996 Total revenue growth (organic plusRevenue development and key milestones Acquired 31st of May 2012 inorganic) of ~35% per year fromEUR million2004-11 Organic growth for the same period was ~22%Ultrasortacquired Odenberg Technology base and acquired segment/application knowledge expanded both through acquisitions and in-house ventures &gt;120 CommoDas Growth driven by: acquired Price increases in food, commodities &amp; landfill costs TITECHReal Vision TITECH Visionsort AS Systems acquired by Favorable changes in regulatory established acquiredTOMRA framework (DSD, WEEE, ELV, etc) QVision AS Strong sales and service network 14.50.5established Technology leadership Higher quality and food safety1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 demands47 </li><li> 48. OUR CORE TECHNOLOGY: THE EYES AND BRAINS OFSORTING AND PROCESSING High-tech sensors are utilized to identify objects on a conveyor belt High speed processing of information: material, shape, size, color, defect, damage and location of objects Precise sorting by air jets or mechanical fingers 48 </li><li> 49. A COMMON SENSOR BASED TECHNOLOGY PORTFOLIOSensor/Material PropertySegment[m] Technology10-12 RM (Radiometric) Natural Gamma RadiationMining Gamma-10-11radiation10-10 XRT (X-ray transmission) Atomic Density Recycling, Mining, FoodLow Energy X-ray X-ray10-910-8XRFX ray fluorescence (ElementalRecycling, MiningUltraviolett (UV) 10-7 Spectroscopy)10-6COLOR (CCD Color Camera) Reflection, Absorption,Recycling, Mining, FoodVisible light (VIS)10-5 Transmission10-4Near Infrared (NIR) Laser attenuation andMonochromatic Reflection Mining, Food10-3PM (Photometric) /Absorption of Laser Light Infrarot (IR)10-2 Scattering analysis of Laser Light Microwaves 10-1NIR / MIR (Near/Medium Reflection, Absorption Recycling, Mining, FoodInfrared Spectrometry) (Molecular Spectroscopy)101LIBS Laser induced breakdownRecycling, MiningRadio waves 102spectroscopy103Alternating current EM (Electro- Conductivity,Recycling, Mining, Food104 (AC) Magnetic sensor) permeability49 </li><li> 50. CUTTING-EDGE TECHNOLOGY DRIVEN BYSIGNIFICANT INVESTMENTS IN R&amp;DSENSOR PORTFOLIO In-house R &amp; D department with morethan 305 peopleElectromagnetic Sensor (EM)Radiometry (RM)Material property detected:Material property detected: Partnership with leading R&amp;Delectromagnetic properties likeradioactivityconductivity and permeabilityinstitutions: SINTEF, CTR, FraunhoferILT; universities like RWTH and BrusselsCCD Color Camera (COLOR) IR Camera (IR) 8% of revenue invested in R&amp;D Material property detected: heatMaterial property detected:color properties in the color areconductivity and heat dissipation 15 test centers worldwideas red, green and blueX-ray Transmission (XRT) X-ray Fluorescence (XRF)Material property detected: specific Material Property detected:atomic density irrespective of size, elemental compositionmoisture or pollution levelVisible Light Spectrometry (VIS) Near-Infrared Spectrometry (NIR)Material property detected: visibleMaterial property detected: specific andspectrum for transparent and opaqueunique spectral properties of reflectedmaterialslight in the near-infrared spectrumLaserInfrared Transmission (IRT)Material property detected:Material property detected:scattering of laser lightlight absorptionTest center in Koblenz, Germany 50 </li><li> 51. WHY SENSOR-BASED SORTING? Increase purity of Increaserecovery of Increase yieldINCREASEsellable materials valuable metals, minerals, Increase throughputREVENUES Increase recovery ratediamonds and gems from ores Increase capacity New technology give access to old dumpsREDUCE Reduce labor Reduce energy ReducelaborCOSTS requirements consumption requirements Lower operating and Reduce water consumption Loweroperating andservice costs Less wear and tear service costs Less rocks needs crushing ReducewasteOTHER Consistentquality of Less environmental impactFood safetyBENEFITSoutput streams Reduce carbon footprintIncreased and consistent Increaseflexibility of Easier permitting quality and safetyproduction lineIncreased flexibility of Monitor material production linecompositionProduction reporting and analysis51a part of TOMRA </li><li> 52. ADOPTION OF SENSOR-BASED SORTING AT DIFFERENTMATURITY LEVELSMaturity/industryadoption FOODRECYCLINGMINING* Time* In certain mining sub-segments, such as industrial minerals and diamonds, sensor-based sorti...</li></ol>