Metso's Interim Review for January 1 - September 30, 2013
Metso Corporation's stock exchange release on October 24, 2013 at 12:00 p.m. local time
We will arrange a news conference on Metso's January-September 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 through
a conference call. Questions are accepted via conference call. Details of the
event can be found at the end of this release.
This is a summary of Metso's January-September 2013 Interim Review. Complete
report is attached to this release as a pdf-file and is also available at
www.metso.com/investors.
Figures in brackets, unless otherwise stated, refer to the comparison period,
i.e. the same period last year.
Highlights of the third quarter 2013:
* Order intake totaled EUR 1,249 million (EUR 1,511 million), which was 17
percent, or 11 percent using comparable exchange rates, lower than in the
comparison period. Orders received by the services business were down 15
percent, or 8 percent using comparable exchange rates, on the comparison
period, and totaled EUR 709 million, i.e. 59 percent of all orders received
(EUR 830 million and 57%).
* Net sales totaled EUR 1 579 million (EUR 1 754 million), down by 10 percent,
or 4 percent using comparable exchange rates. Services net sales were 3
percent down, and 4 percent up using comparable exchange rates, compared to
those booked during the same quarter last year. Services sales totaled EUR
762 million and accounted for 50 percent of total net sales (EUR 788 million
and 46%).
* Earnings before interest, tax and amortization (EBITA), before non-recurring
items, were EUR 143 million, i.e. 9.1 percent of net sales (EUR 171 million
and 9.8%) The decline was mainly due to lower profitability at Valmet
Automotive.
* Earnings per share were EUR 0.39 (EUR 0.73).
* Free cash flow was EUR 95 million (EUR 118 million).
Our guidance for Metso's 2013 financial performance
We repeat our guidance for 2013 financial performance, which was published on
October 17, 2013 and at the time lowered from previous guidance given in our
January-June Interim Review on July 25, 2013. Lowering was primarily resulting
from lower profitability at the separate business entity Valmet Automotive
during the second half of the year.
Our guidance for 2013:
We estimate that our net sales and EBITA before non-recurring items in 2013 will
be significantly lower than those in 2012.
The previous guidance, published on July 25, 2013:
We estimate that our net sales and EBITA before non-recurring items in 2013 will
be somewhat lower than those in 2012.
Both statements above are related to Metso's current segment reporting and are
based on the economic situation, market outlook, order backlog for 2013, and
foreign exchange rates remaining similar to those at the time of publishing.
In addition to the updated guidance for the group, we published the following
additional segment information for 2013:
* Mining and Construction segment: Net sales are expected to be somewhat lower
and EBITA before non-recurring items at around the same level compared to
2012
* Automation segment: Net sales are expected to be at around the same level
and EBITA before non-recurring items is expected to improve significantly
compared to 2012
* Pulp Paper and Power segment (businesses to be demerged from Metso): Both
net sales and EBITA before non-recurring items are expected to be
significantly lower compared to 2012. Net sales and EBITA before non-
recurring items during the second half are expected to be at about the first
half's level.
* Valmet Automotive is expected to book a substantial loss for 2013.
Metso plans to publish separate guidance statements for its continuing
operations and Valmet Corporation during the fourth quarter.
Metso's President and CEO Matti Kähkönen comments on the third quarter:
The third quarter was somewhat mixed. We were able to improve the profitability
of the Mining and Construction and Automation segments, despite continued soft
demand for larger equipment and project orders, thanks to improved productivity
and a resilient services business, which also supported a favorable delivery
mix. Pulp, Paper and Power booked satisfactory quarterly EBITA. However, work
continues to improve its profitability. Significant negative development was
seen at Valmet Automotive and corrective actions have been taken.
The demerger project has progressed according to plan and shareholders approved
the demerger of the Pulp, Paper and Power businesses to the new Valmet
Corporation in the Extraordinary General Meeting in October.
Metso's key figures
Q3/ Q3/
EUR million 2013 2012 Change % Q1-Q3/ 2013 Q1-Q3/ 2012 Change % 2012
Orders received 1,249 1,511 -17 4,716 5 166 -9 6,865
Orders received of
services business 709 830 -15 2,388 2 523 -5 3,264
% of
orders received * 59 57 52 51 49
Order backlog at
end of period 3,736 5 031 -26 4,515
Net sales 1,579 1,754 -10 4,925 5 406 -9 7,504
Net sales of
services business 762 788 -3 2,268 2,304 -2 3,174
% of net
sales * 50 46 47 44 44
Earnings before
interests, tax and
amortization
(EBITA) and non-
recurring items 142.9 171.4 -17 416.6 490.8 -15 687.5
% of net
sales 9.1 9.8 8.5 9.1 9.2
Operating profit 90.2 157.7 -43 306.3 451.4 -32 601.7
% of net
sales 5.7 9.0 6.2 8.3 8.0
Earnings per
share, EUR 0.39 0.73 -47 1.21 1.98 -39 2.46
Free cash flow 95 118 -19 149 188 -21 257
Return on capital
employed (ROCE)
before taxes,
annualized % 12.8 20.2 19.7
Equity to asset
ratio at end of
period, % 38.7 41.8 40.5
Net gearing at end
of period, % 24.0 16.7 14.2
*Excluding Valmet
Automotive
Short-term outlook
Market development
Many of our customer industries continue to be characterized by a weaker
investment appetite compared to previous year. Although some initial positive
signs have been seen at the macro economic level, these have not had a material
impact on our businesses.
Mining and Construction and Automation segments:
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 is expected to remain satisfactory,
whereas demand for flow control products and related services is expected to
remain good.
Pulp, Paper and Power segment (businesses to be separated in the demerger):
In the Services business, demand is expected to remain satisfactory.
In the Pulp and Energy business, demand for pulp mills and rebuilds is expected
to remain satisfactory, while that for power plants based on renewable energy
sources is expected to remain weak.
In the paper business, structural change in the paper industry is likely to
continue and demand for papermaking lines is expected to remain weak.
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.
www.metso.com, www.twitter.com/metsogroup
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 for media, investors and analysts in
Helsinki on Thursday, October 24, 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 at
www.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.
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: 927 192
A replay of the call will be available for two weeks until November 7, 2013 on
the following phone numbers:
* US: +1 954 334 0342
* other countries: +44 20 7031 4064
* access code 927 192
An audio file (mp3) and a transcript of the event will be made available for
downloading at www.metso.com/IRwebcasts on Monday, October 28, 2013 the latest.
The presentation material will be available after the publication of the Interim
Review on October 24, 2013 at www.metso.com/investors at approximately 12.00
noon local time (EEST).
Welcome!
Distribution:
NASDAQ OMX Helsinki Ltd
Media
www.metso.com