Metso Corporation : Margin improved in a slightly softer market environment
Metso Corporation's stock exchange release on April 23, 2013 at 12:00 a.m.
We will arrange a news conference on Metso's January-March 2013 interim review
for the media, investors and analysts, in Helsinki today. The event takes
place at Metso Group Head Office, Fabianinkatu 9 A, Helsinki, Finland. A News
conference in English will be arranged at 15:00 EEST / Helsinki time (08:00
EDT / New York, 13:00 BST / London, 14:00 CEST / Paris). The news conference
can also be followed through a live webcast at www.metso.com/irwebcasts and a
conference call, details at the end of this release. Questions are accepted
via conference call only.
This is a summary of Metso's January-March 2013 Interim Review. Complete
report is attached to this release as a pdf-file and is also available at
Figures in brackets, unless otherwise stated, refer to the comparison period,
i.e. the same period last year.
Highlights of the first quarter of 2013
oNew orders worth EUR 1,584 million were received in January-March (EUR
1,920 million). Orders received by the services business were at a similar
level to those in the first quarter of 2012 and totaled EUR 873 million,
i.e. 57 percent of all orders received (EUR 881 million and 48%).
oNet sales were EUR 1,590 million (EUR 1,755 million). Net sales in the
services business were at the level of comparison period, EUR 727 million
and accounted for 47 percent of Metso's net sales (EUR 721 million and
oEarnings before interest, tax and amortization (EBITA), before
non-recurring items, were EUR 132 million, i.e. 8.3 percent of net sales
(EUR 141 million and 8.0%).
oEarnings per share were EUR 0.48 (EUR 0.56).
oFree cash flow was EUR 74 million (EUR 116 million).
oThe Board decided to start a strategy study relating to a possible
demerger of Metso.
Guidance for financial performance during 2013 unchanged
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
March, we estimate that our EBITA before non-recurring items in 2013 will be
at around 2012 levels and our net sales at the 2012 level or slightly below.
Metso's President and CEO Matti Kähkönen comments on the first quarter:
The first quarter was two-fold for Metso. Firstly, as expected, demand for new
equipment and projects remained similar to that seen in the previous quarter
and below that in the first quarter of 2012. Secondly, and even more
importantly, Metso's flexible business model and focus on its services
business yielded a good operating result (EBITA) and an improved EBITA margin
for the quarter, despite net sales coming in a little slower than in early
2012. The Mining and Construction and Automation segments recorded a strong
improvement in their margins, and we expect these segments to perform well
going forward. Pulp, Paper and Power, however, was weak, as had been expected.
The challenges in this segment are known and we will continue our actions to
improve profitability in the business. The results of this work, together with
our slightly more optimistic view of the segment's customer industries, are
expected to be seen in better performance later this year.
In March, the Board launched a strategy study to review the possibilities of
separating Metso into two independent listed companies. This work is
proceeding at a good pace and according to the planned milestones. We are
confident that this project will be in the best interests of our customers,
personnel, shareholders and other stakeholders.
Metso's key figures
EUR million Q1/2013 Q1/2012 Change % 2012
Orders received 1,584 1,920 -18 6,865
Orders received of services business 873 881 -1 3,264
% of orders received ^1) 57 48 49
Order backlog at end of period 4,558 5,407 -16 4,515
Net sales 1,590 1,755 -9 7,504
Net sales of services business 727 721 1 3,174
% of net sales ^1) 47 43 44
Earnings before interest, tax and amortization 131.5 141.2 -7 687.5
(EBITA) and non-recurring items
% of net sales 8.3 8.0 9.2
Operating profit 119.2 129.0 -8 601.7
% of net sales 7.5 7.4 8.0
Earnings per share, EUR 0.48 0.56 -14 2.46
Free cash flow 74 116 -36 257
Return on capital employed (ROCE) before taxes, 15.1 17.8 19.6
Equity to assets ratio at end of period, % 36.9 36.3 40.5
Net gearing at end of period, % 13.5 7.6 14.2
^1) Excluding Valmet Automotive
The global economic situation and demand in our customer industries have
remained largely unchanged during the early part of the year. Some initial
positive signs have been seen in the US and China, which may have a positive
impact on the activity of our customer industries in the second half of 2013.
Stable capacity utilization levels and the need to increase production
efficiency will continue to support demand for our services business.
We expect underlying demand in the mining market to remain at the good level
seen during the first quarter of the year. Due to expected high utilization
rates at mines, our large installed equipment base, and stronger services
presence, we expect demand for our mining services to remain excellent.
Demand for construction equipment is projected to strengthen somewhat in
emerging markets, especially China. In developed markets, we anticipate demand
to remain at current relatively low levels going forward. Demand for our
construction industry services is expected to remain satisfactory.
Demand for our process automation and flow control solutions and services is
expected to remain good. Strong demand in the oil and gas industry is expected
to offset continuing softness in the pulp and paper industry.
The market for pulp mills is expected to remain satisfactory, with good demand
for rebuilds and services. Structural changes in the paper industry are likely
to continue and the demand for papermaking lines is expected to remain weak
and the outlook for services good. Demand for recovery boilers for the pulping
industry is projected to continue stable, whereas shale gas will continue to
have a negative impact on market of renewable energy solutions. All in all, we
expect the demand for power plants and for related services to remain
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
VP, Investor Relations
Invitation to news conference for media, investors and analysts
Metso will arrange a news conference for investors and analysts in English in
Helsinki on Tuesday, April 23, 2013 at 15:00 EEST / Helsinki time (08:00 EDT /
New York, 13:00 BST / London, 14:00 CEST / Paris)
The event will take place at Metso Group Head Office, Fabianinkatu 9 A,
This conference can also be followed through a live webcast at
www.metso.com/IRwebcasts and a conference call from 3:00 p.m. onwards.
Questions are accepted during the event via the conference call only.
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. Also, requests for same day interviews are accepted, please contact
Milla Kivinen, Communications officer, tel. +358 50 317 3500.
Conference call details
Conference call participants are requested to dial in five minutes before the
scheduled time at:
oUS: +1 877 491 0064
oother countries: +44 20 7162 0077
oaccess code: 927 189
A replay of the call will be available until May 7, 2013 on the following
oUS: +1 954 334 0342
oother countries: +44 20 7031 4064
oaccess code 927 189
An audio file (mp3) and a transcript of the event will be made available for
downloading at www.metso.com/IRwebcasts on Thursday, April 25, 2013 the
The presentation material will be available after the publication of the
Interim Review on April 23, 2013 at www.metso.com/Investors at approximately
12.00 noon local time/EEST.
NASDAQ OMX Helsinki Ltd
Interim Review Q1 2013
This announcement is distributed by Thomson Reuters on behalf of Thomson
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(i) the releases contained herein are protected by copyright and other
applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of
information contained therein.
Source: Metso Corporation via Thomson Reuters ONE
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