Highlights of the second quarter 2013:
- New orders worth EUR 1,883 million (EUR 1,735 million) were received in April-June, an increase of 9 percent. Orders received by the services business across all segments were on a par with the comparison period, amounting to EUR 806 million, i.e. 44 percent of all orders received (EUR 812 million and 48%).
- Net sales totaled EUR 1,756 million (EUR 1,897 million). Services business net sales were comparable to those booked during the same quarter last year, totaling EUR 780 million, and accounted for 46 percent of total net sales (EUR 795 million and 43%).
- Earnings before interest, tax, and amortization (EBITA), and before non-recurring items, were EUR 142 million, i.e. 8.1 percent of net sales (EUR 178 million and 9.4%).
- Earnings per share were EUR 0.34 (EUR 0.69).
- Free cash flow was EUR 20 million negative (EUR 46 million negative).
- The demerger process proceeded according to plan.
We have updated our guidance for 2013 financial performance:
Based on the current economic situation, the market outlook, our order backlog for 2013, and foreign exchange rates remaining similar to those at the end of June, we estimate that Metso’s net sales and EBITA before non-recurring items in 2013 will be somewhat lower than those in 2012.
Previous guidance (from January-March 2013 Interim Review, published on April 23, 2013): We estimate that Metso’s EBITA before non-recurring items in 2013 will be at around 2012 levels and that our net sales will be similar to that in 2012 or slightly lower.
Metso’s President and CEO Matti Kähkönen comments on the second quarter:
We can be satisfied with what we achieved during the second quarter. Despite the prevailing uncertainty of the global economy, which has continued to impact our customer industries, we received new orders worth more than EUR 1.8 billion during the quarter. It was positive to see Metso win another major pulp mill order; new investments in the mining industry have continued at a lower level, however. Our net sales declined year-on-year, primarily due to a slow-down in some of our capital businesses. The services business has remained at a similar level to last year, which is positive, but we are continuing our efforts to grow volumes in this area. EBITA before non-recurring items was fairly good, with Automation performing well, while Mining and Construction was impacted by declining capital deliveries. Pulp, Paper and Power faced similar challenges to those experienced during previous quarters.
We also made good progress with the demerger in the second quarter. The Board signed a demerger plan at the end of May and will propose that shareholders approve the demerger at an Extraordinary General Meeting in early October. Outlining the strategies and organization of the new Metso and Valmet will keep us busy during the next few months, and I remain confident that the demerger, conditional on the EGM’s approval of course, will be successful and will be in the best interest of Metso and its shareholders.
Short-term outlook
Market development
Uncertainty in the global economy continued and demand in our customer industries deteriorated somewhat during the first half of the year. Some initial positive signs seen in the US and China have not impacted materially our customer industries.
We expect demand for mining equipment to remain satisfactory. Due to our large installed equipment base and our stronger services presence, we expect demand for our mining services to remain good.
Demand for construction equipment and related services is projected to remain satisfactory. Demand for our process automation systems and flow control products and services is expected to remain good. Strong demand in the oil and gas industry is expected to offset the continuing softness affecting the pulp and paper industry.
The market for pulp mills and rebuilds is expected to remain satisfactory, with good demand for services.
Structural changes in the paper industry are likely to continue and the demand for papermaking lines is expected to remain weak, while the outlook for services is good.
Demand for recovery boilers for pulp mills is projected to continue satisfactory. Demand for power plants based on renewable energy sources is expected to stay weak and that for related services to remain satisfactory.
Metso is a global supplier of technology and services to customers in the process industries, including mining, construction, pulp and paper, power, and oil and gas. Our 30,000 professionals based in over 50 countries contribute to sustainability and deliver profitability to customers worldwide. Metso’s shares are listed on the NASDAQ OMX Helsinki Ltd.
For further information, please contact:
Matti Kähkönen, President and CEO, Metso Corporation, tel. +358 20 484 3000
Harri Nikunen, CFO, Metso Corporation, tel. +358 20 484 3010
Juha Rouhiainen, VP, Investor Relations, Metso Corporation, tel. +358 20 484 3253
Metso Corporation
Harri Nikunen
CFO
Juha Rouhiainen
VP, Investor Relations
Invitation to news conference for investors, analysts and media
Metso will arrange a news conference in Helsinki today, July 25, 2013 at 08:00 EDT / New York, 13:00 BST / London, 14:00 CEST / Paris, 15:00 EEST / Helsinki.
The event will take place at Metso Group Head Office, Fabianinkatu 9 A, Helsinki, Finland.
This conference can also be followed through a live webcast atwww.metso.com/IRwebcasts and a conference call from 3:00 p.m. local time onwards. Questions are accepted during the event via conference call.
Due to live webcast, we kindly ask those attending to be present 5 minutes prior to the start of the event.
Representatives of the media are also welcome to attend, requests for same day interviews are also accepted.
Conference call details
Conference call participants are requested to dial in five minutes before the scheduled time at:
US: +1 877 491 0064
other countries: +44 20 7162 0077
access code: 927 190
A replay of the call will be available until August 8, 2013 on the following phone numbers:
US: +1 954 334 0342
other countries: +44 20 7031 4064
access code: 927 190
An audio file (mp3) and a transcript of the event will be made available for downloading at www.metso.com/IRwebcasts on Monday, July 29, 2013 the latest.
The presentation material will be available after the publication of the Interim Review on July 25, 2013 at www.metso.com/Investors at approximately 12.00 noon local time.
Distribution:
NASDAQ OMX Helsinki Ltd
Media
