Metso's Interim Review January 1 - September 30, 2018

Metso's Interim Review January 1 - September 30, 2018

Metso Corporation, Stock Exchange Release, October 26, 2018 at 11:00 a.m. EEST
 
This is a summary of Metso's January 1 - September 30, 2018 Interim Review. The complete report is attached to this release and is also available at www.metso.com/latestreports.

Figures in brackets refer to the corresponding period in 2017, unless otherwise stated.

July-September 2018 in brief

• Healthy activity in all markets
• Orders received increased 8%, or 16% in constant currencies, to EUR 883 million (817 million)
• Services orders grew 4%, or 12% in constant currencies, to EUR 461 million (443 million)
• Sales grew 18%, or 25% in constant currencies, and totaled EUR 786 million (667 million)
• Services sales grew 10%, or 18% in constant currencies, and totaled EUR 436 million (397 million)
• Adjusted EBITA was EUR 96 million, or 12.2% of sales (43 million, or 6.4%)
• Operating profit (EBIT) totaled EUR 91 million, or 11.6% of sales (39 million, or 5.9%)
• Earnings per share were EUR 0.40 (0.13)
• Free cash flow was EUR 66 million (58 million)

 January-September 2018 in brief

• Orders received increased 13%, or 20% in constant currencies, to EUR 2,595 million (2,298 million)
• Services orders grew 7%, or 14% in constant currencies, to EUR 1,415 million (1,324 million)
• Sales grew 14%, or 21% in constant currencies, and totaled EUR 2,276 million (1,989 million)
• Services sales grew 10%, or 17% in constant currencies, and totaled EUR 1,300 million (1,183 million)
• Adjusted EBITA was EUR 272 million, or 11.9% of sales (179 million, or 9.0%)
• Operating profit (EBIT) totaled EUR 258 million, or 11.3% of sales (159 million, or 8.0%)
• Earnings per share were EUR 1.11 (0.60)
• Free cash flow was EUR 89 million (101 million) 

Key figures

EUR million	Q3/2018	Q3/2017	Change %	Q1-Q3/ 2018	Q1-Q3/ 2017	Change %	2017
Orders received	883	817	8	2,595	2,298	13	2,982
Orders received of services business	461	443	4	1,415	1,324	7	1,717
% of orders received	52	54		55	58		58
Order backlog at end of period				1,686	1,491	13	1,439
Sales	786	667	18	2,276	1,989	14	2,699
Sales of services business	436	397	10	1,300	1,183	10	1,595
% of sales	55	60		57	60		59
Adjusted EBITA	96	43	122	272	179	51	244
% of sales	12.2	6.4		11.9	9.0		9.0
Operating profit	91	39	131	258	159	63	218
% of sales	11.6	5.9		11.3	8.0		8.1
Earnings per share, EUR	0.40	0.13	205	1.11	0.60	85	0.68
Free cash flow	66	58	15	89	101	-12	158
Return on capital employed (ROCE) before taxes, annualized, %				17.1	9.8		10.3
Equity to assets ratio at the end of period, %				47.8	45.3		44.5
Net gearing at the end of period, %				10.3	3.8		1.8
Personnel at the end of period				12,772	11,698	9	12,037

Market outlook
Previous outlook, published on July 26, 2018, in brackets.

Our market conditions are expected to develop as follows:

• Growth in demand to increase for Minerals equipment
• Growth in demand to remain stable for Minerals services
• Growth in demand to remain stable (to level off) for Flow Control  

The outlook represents expected sequential market development with a rolling six-month view. 

Interim President and CEO Eeva Sipilä:

I am very pleased with our strong order growth of 8% during the third quarter. Despite global political and economic uncertainty, we have been successful in offering our customers solutions that deliver sustainable productivity improvements. We continue our intense efforts on R&D and digitalization to further develop our offering globally. In addition, work on growth investments and adjacent acquisitions supporting our profitable growth strategy has continued as planned, demonstrated by our announcement in September to invest in additional foundry capacity in India.

Our 18% sales growth reflects progress in ramping-up our supply chain. We continue to drive multiple actions to further improve our delivery capabilities and flexibility. Our sales mix in Minerals is changing, as indicated earlier, with higher growth in equipment than services. While this affects our margin development to some extent, the expansion of our installed base is important for our future. Nevertheless, we reached an adjusted EBITA margin of 12.2% in the quarter.

Metso's year-to-date financial results demonstrate, that we have been able to make a step change in our performance this year. The energy and commitment of the Metso people all over the world has been instrumental in this, and we will continue to build on these strengths under the leadership of our new President and CEO Pekka Vauramo, who is taking charge on November 1.

Audiocast and conference call details

Metso's Interim President and CEO Eeva Sipilä will present the financial results in an audiocast and a conference call for analysts and investors, held in English, today at 2:00 p.m. EEST. Audiocast can be followed at www.metso.com/latestreports.

Conference call participants are requested to dial in five minutes before the event on:
United States: +1 631 913 1422
other countries: +44 (0)333 300 0804

The confirmation code for joining the conference call is 45862865#.

For further information, please contact:
Eeva Sipilä, Interim President and CEO & CFO, Metso Corporation, tel. +358 20 484 3010
Juha Rouhiainen, VP, Investor Relations, Metso Corporation, tel. +358 20 484 3253                 
                                  
Metso Corporation
Eeva Sipilä
CFO

Juha Rouhiainen
VP, Investor Relations

Distribution:
Nasdaq Helsinki
Media
www.metso.com

Metso is a world-leading industrial company offering equipment and services for the sustainable processing and flow of natural resources in the mining, aggregates, recycling and process industries. With our unique knowledge and innovative solutions, we help our customers improve their operational efficiency, reduce risks and increase profitability. Metso is listed on the Nasdaq Helsinki in Finland and had sales of about EUR 2.7 billion in 2017. Metso employs over 12,000 people in more than 50 countries. www.metso.com,  www.twitter.com/metsogroup