Automation: Oil & gas customer industry. More information at www.metso.com/CMD or www.metso.com/investors.

1. Creating performance
and success
Perttu Louhiluoto
President, Automation
November 27, 2013
London, UK

2. 1
Our development for the past
12 months has been very good
2
Automation is a growth business
and we serve diversified
industries
3
We have solid growth
opportunities in all our focus
industries
4
We are ready to execute on our
ambitious targets

3. Metso in O&G – safety valves practically
invulnerable for sabotage
“The facility's hundreds
of control valves (officially
known as ESDs; or
emergency shutdown
devices),… ,were virtually
invulnerable, having been
recently refitted with
something called
a Neles ValvGuard
Petrobras Paulinia’s
(REPLAN) oil refinery
system”
is a terrorist target,
but Metso’s intelligent
safety valves provide
a high level of protection.
3
© Metso
Capital Markets Day 2013
(Extract from Dead or
Alive by Tom Clancy,
page 566)

4. Our Automation business today
Flow control solutions, automation and information
management networks and systems, combined
with life cycle performance services
Flow Control
Services
Flow Control solutions covering
control, automated on-off and
safety valves, as well as
intelligent positioners and
instrumentation
Services to maximize our
customers’ profitability, ranging
from process optimization to
intelligent maintenance and
upgrades
32% of net sales
45% of net sales
Net sales 2012: EUR 859 million
Personnel ~ 4,100
Process Automation
Systems
Complete process automation
solutions covering control
systems, specialty systems,
measurements, analyzers, and
other applications
23% of net sales
Our customers: O&G, P&P, Power, Mining, and other process industries
4
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Capital Markets Day 2013

5. Share of personnel in emerging markets has
increased
December 2005
Total number of employees: 3,169
3%2%
September 2013
Total number of employees: 4,250
6%
2%
8%
19 %
26 %
61 %
Europe and CIS
North America
Asia-Pacific
South and
Central America
Africa and Middle East
54 %
20 %
Europe and CIS
North America
Asia-Pacific
South and
Central America
Africa and Middle East
Transactions 2005 - 2013
Acquisition of Kemotron (conductivity measurements), Mapag (high-performance valves), Viconsys
(Machine vision), Valstone (Globe valves), ExperTune (Performance services) : ~200 people
5
© Metso
Capital Markets Day 2013

6. Major achievements during this year
1-9/2013
Change
from 1-9/2012
693
+8%
79
+12%
EBITA-%*
13.0%
+1.8-points
Operative ROCE-%
35.3%
+5.4 % -points
Orders received, EUR million
EBITA*, EUR million
Acquisitions
Operational improvements
 Driving services growth by acquiring
ExperTune (performance services)
 Significant GP-% improvement in
Flow Control
 Realized procurement savings
of EUR ~5 million
 Investing in a direct presence in emerging
markets by in-housing our valve production
from the SNJ joint venture in China (divesting
50% holding of joint venture)
6
© Metso
Capital Markets Day 2013
*before non-recurring items

7. Strong profitability improvement in Flow Control
Main sources
Flow Control GP-% development
 Improved supply chain
management and
procurement savings
 Reduced fixed costs
 Volume leverage
 Price management
Multiple
percentage
points
Jan 2008
7
© Metso
Capital Markets Day 2013
Sep 2013

8. 1
Our development for the past
12 months has been very good
2
Automation is a growth business
and we serve diversified
industries
3
We have solid growth
opportunities in all our focus
industries
4
We are ready to execute on the
ambitious targets

9. We are in a market strongly driven
by megatrends
Automation helps
process industries:
Automation industry net sales growth vs overall machinery sector
 generate more output
from less input (labor,
materials, energy)
 generate less waste
and pollution
 optimize yields
 improve environmental
management and
compliance
 maximize uptime
9
© Metso
Capital Markets Day 2013
Source: J.P: Morgan Global Industrial Automation research Sep 2013,
data from VDMA.

10. We serve a diversified mix of industries
Approximate net sales split
40%
of the world’s polyolefin flow
through Metso’s valves
#1
Automation
provider in P&P
75%
of the world's pulp
flows through
Metso valves
Oil & gas
Power
Mining and other
Pulp & Paper
10
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Capital Markets Day 2013
40%
40%
10%
10%
>100
Minerals processing
systems delivered
60%
of all LNG flows through
Metso’s valves
Nearly
1,000
power plants worldwide feature
Metso’s process automation
1st
Industry’s first mobile crushing
plant automation system

11. Markets are expected to continue to grow
Total market
size, USD bn
Mining
Short-term
outlook
Long-term
outlook
Automation
CAGR-%, 2012-17
4
6
Oil & Gas
Up- and
midstream
Downstream
25
Industrial Gas
Chemical and
Petrochemical
Pulp & Paper
13
© Metso
6
3
Power
11
6
3
14
Capital Markets Day 2013
6
Source: EIF, ARC, Frost & Sullivan and Metso estimates

12. 1
Our development for the past
12 months has been very good
2
Automation is a growth business
and we serve diversified
industries
3
We have solid growth
opportunities in all our focus
industries
4
We are ready to execute on the
ambitious targets

13. Oil & Gas is a highly lucrative automation
market with the biggest potential for Automation
• Automation has grown its oil & gas
O&G
Net sales split (Approximate)
business consistently over time
-
10-year CAGR: ~10%
• We have established strong direct
sales channels and a presence with
major end-customers and engineering,
procurement and construction
companies (EPCs)
40%
Automation market:
USD 38 billion
• Very fragmented business with a large
Addressable market:
USD 5 billion
• Strong and growing services business
Metso market position:
Established niche position
number of players
Opportunities for profitable growth
for Metso
13
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Capital Markets Day 2013
Market growth rate:
Main competitors:
Emerson, Flowserve, Samson
Source: EIF, ARC, Frost & Sullivan and Metso estimates
6%

14. Lot of opportunities globally – including
in frontier markets
O&G
EMEA:
North America
•
•
•
•
35%
Shale/Tight oil
Shale gas
Oil sands
Petrochemical
• Conventional oil & gas in:
• Middle East, Africa
30%
and Russia
• Russia refinery
modernizations
South
America
% Regional
share of
• Brazil Pre-salt
• Shale gas
in Argentina
Automation’s
oil & gas sales
14
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Capital Markets Day 2013
China:
• Refining
• Shale gas
reserves
• Pipelines
Asia-Pacific:
5%
• Conventional
oil & gas
• Refining
20%
10%

15. Metso can solve customers’ challenges
Customer challenges
1. Improved profitability
2. Environmental concerns and
compliance needs
3. Safety concerns
4. Maximized uptime
Metso solutions
Maximize the profitability of our
customers’ businesses with the most
reliable and cost-efficient solutions
Services:
• Intelligent maintenance and shutdown
solutions
• Process and control optimization
• Replacement products and spare parts
• Upgrades and extensions
Flow Control:
• Control and automated on-off valves
• Emergency shut-down (ESD) valves
Process Automation:
• Process Control systems
15
© Metso
Capital Markets Day 2013
O&G

16. Focus on optimizing performance
ExperTune
• Solutions for improving customers’
plant operation
• Flexible solutions enhansing
production, efficiency, quality, or
other business objectives
• Can be applied to greenfield or
brownfield sites
• Can be sold
- as a service and as software
- through direct and partner
channels
16
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Capital Markets Day 2013
#8,000
installations globally
O&G

17. Pulp & Paper provides profitable growth
opportunities for Automation
• Globally a niche segment, where
P&P
Net sales split (Approximate)
Metso is the #1 player
• Some segments are growing, and
growth is projected for pulp & paper
automation overall
40%
• Limited number of new entrants
expected and competitors defocusing
Automation market:
USD 3 billion
Addressable market:
USD 3 billion
Market growth rate:
Metso market position:
Opportunities for profitable growth
for Metso
17
© Metso
Capital Markets Day 2013
3%
#1
Main competitors: ABB, Honeywell,
Flowserve
Source: EIF, ARC, Frost & Sullivan and Metso estimates

18. Metso and Valmet will continue to work
closely together
• Metso’s automation offering for pulp,
paper, and power has brought strong
results
-
World’s leading process automation, flow
control solutions and related services
provider for pulp and paper
Widest range of automation-solutions for
pulp and paper
• Unique automation technology
-
and product development
Close cooperation with equipment vendor
and plant suppliers in projects and in
sales
• Close cooperation with Metso and
Valmet will continue benefitting both
companies and on customers
18
© Metso
Capital Markets Day 2013
P&P

19. Automation is looking to grow in the power
industry with partners
• We have consistently developed the
power automation system business for
many years
• Our technology is installed in over
1,000 power plants globally
-
Niche position in bio and waste-toenergy and in selected countries
Partners utilizing our technology
• Entered the indian fossil fuel power
generation with Bharat Heavy Electricals
Limited (BHEL) - >80% market share in
Indian Distributed Control System (DCS)
market in power
• Entered the Chinese fossil fuel power
market with SAC JV
Opportunities to grow through our
partners
19
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Capital Markets Day 2013
Power
Net sales split (Approximate)
10%
Automation market:
USD 14 billion
Addressable market:
USD 5 billion
Market growth rate:
Metso market position:
Established niche position
Main competitors:
ABB, Siemens, Emerson
Source: EIF, ARC, Frost & Sullivan and Metso estimates
6%

20. Success through partnerships:
Case SAC JV
• JV established with Guodian Nanjing Automation
Co., Ltd (SAC) in 2011 (Metso 33% / SAC 67%)
-
SAC is a public company owned 58% by Huadian Power
International Corporation Limited, one of the five largest
power generating companies in China
• Our Distributed Control System (DCS) technology
complements SAC’s digital power plant offering in
turnkey deliveries for Huadian Corp’s power plant
projects
• Fast business start-up, with numerous projects won,
commissioned, or being commissioned
• SAC JV's first project with DCS and turbine controls
for an ultra-supercritical 1,000 MW plant successfully
commissioned at Huadian's Jurong plant
20
© Metso
Capital Markets Day 2013
Power

21. Mining provides lucrative growth
opportunities for us
• We have gained a foothold in mining
Mining
and other
Net sales split (Approximate)
automation
• Market is developing rapidly – large
demand for intelligent solutions to
solve major industry challenges
- Increasing HSE standards
- Decreasing ore grade quality
- More remote mine sites and
-
scarcity of talent
Rising energy and water costs
• Our offering includes complementary
slurry pump and valve solutions
Excellent opportunity for us to develop
intelligent solutions by combining our
process, equipment and automation
know- how
21
© Metso
Capital Markets Day 2013
10%
Automation market:
USD 4 billion
Addressable market: < USD 1 billion
Market growth rate:
Metso market position:
Established niche position
Main competitors:
ABB, Honeywell, Rockwell
Source: EIF, ARC, Frost & Sullivan and Metso estimates
6%

22. Delivering intelligent solutions:
Case Belo Monte
Mining
and other
Customer
World’s third largest hydroelectric plant
Contractor: Consorcio Construtor Belo Monte – CCBM
Solutions
Engineering, Procurement and Construction (EPC) for crushing plants
Mining and Construction
Equipment
3 fixed, fully automated crushing
plants
Mining and Construction
Intelligence
Process automation and info systems for all six plants
Automation
3 mobile crushing plants featuring
remote monitoring
Mining and Construction
Remote monitoring system for
mobile equipment
Automation
22
© Metso
Capital Markets Day 2013

23. 1
Our development for the past
12 months has been very good
2
Automation is a growth business
and we serve diversified
industries
3
We have solid growth
opportunities in all our focus
industries
4
We are ready to execute on the
ambitious targets

24. We have set ourselves ambitious targets
in Automation
Maintain
market
leadership in
pulp & paper
automation
Become one
of the top 3 flow control
companies in oil & gas,
refining, and
petrochemicals
Become one of
the industry leaders
(profitability, scope, and
size) in the flow
control space
Achieve
significant
growth in
services
24
© Metso
Capital Markets Day 2013
Achieve a
significant and
growing PAS
business outside
pulp & paper
Become a leading
provider of advanced
automation solutions for
mining and construction
customers

25. We are focusing on prioritized must-win initiatives
to reach our targets
Must-win
Initiative
Services
• Expand service business offering and competencies
• Strengthen our network
Growth countries
• Strengthen the role of regions
• Increase growth in China, Brazil, India, Russia, and the Middle East
Technology
• Develop and expand our valve offering
• Develop Metso DNA as a growth platform
Operating model
• Strengthen cost-competitiveness and operational excellence,
sourcing in particular
• Ensure that we capture the true value of acquisitions
People
• Strengthen our safety culture
• Upgrade critical core competencies
Developing new
businesses
• Grow in mining and construction automation
• Grow in analyzers
25
© Metso
Capital Markets Day 2013

26. Conclusions
Automation’s organic
development for the past
12 months has been very
good
We have solid growth
opportunities in all our
target industries




26
Oil & Gas
Pulp & Paper
Power
Mining
© Metso
Capital Markets Day 2013
We have set ourselves
ambitious targets:
We will achieve
our targets by:
 Become one of the top
3 flow control companies
in oil & gas, refining, and
petrochemicals
 Achieve significant growth
in services
 Achieve a significant and
growing business outside
pulp & paper
 Become a leading provider
of advanced automation
solutions for mining and
construction customers
 Strengthening our costcompetitiveness and
operational excellence
 Strengthening the role of
regions
 Expanding our service
business
 Developing our technology
leadership and new
business models

28. Automation
Business model
Product
supply
28
© Metso
Services
Global large end customers
and EPCs. Number of regional
and local players. Long-term
focus.
Mix of Flow Control and Process
Automation system clientele
80%
Metso direct sales and
service network
>90%
Metso direct sales and
service network
>90% Metso direct sales and
A few agents in selected
markets and distributor
network in North America
<10%
A few agents in selected
markets and distributor
network in North America
<10% A few agents for selected
50%
In-house order
engineering, production
of key components and
assembly
70%
In-house spare parts
operations. Knowledge
based services and OEM
maintenance.
40%
In-house assembly and
final testing, in-house
project management and
engineering
50%
Sales &
service
Flow Control
20%
Customer
base
Externally purchased
materials, castings and
components
30%
Spare parts components
and sub-contracted basic
services
60%
Externally purchased
components, subassemblies, engineering
and services
Capital Markets Day 2013
Process Automation
systems
A few global corporations and a
number of regional and local
players. Long-term focus.
service network
products and markets.
Role of strategic partners
increasing