Metso's Half-Year Review January 1 - June 30, 2018

Metso's Half-Year Review January 1 - June 30, 2018
Metso Corporation, Stock Exchange Release, July 26, 2018 at 09:00 a.m. EEST


This is a summary of Metso's January 1 - June 30, 2018 Half-Year 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.

April-June 2018 in brief

• Healthy activity in all markets
• Orders received increased 14%, or 22% in constant currencies, to EUR 853 million (749 million)
• Services orders grew 7%, or 15% in constant currencies, to EUR 463 million (431 million)
• Sales grew 15%, or 23% in constant currencies, and totaled EUR 776 million (675 million)
• Services sales grew 10%, or 18% in constant currencies, and totaled EUR 442 million (403 million)
• Adjusted EBITA was EUR 91 million, or 11.7% of sales (70 million, or 10.4%)
• Operating profit (EBIT) up 45%, totaling EUR 86 million, or 11.1% of sales (60 million, or 8.9%)
• Earnings per share were EUR 0.38 (0.24)
• Free cash flow was EUR 21 million (4 million)

January-June 2018 in brief

• Orders received increased 16%, or 23% in constant currencies, to EUR 1,712 million (1,482 million)
• Services orders grew 8%, or 16% in constant currencies, to EUR 954 million (882 million)
• Sales grew 13%, or 20% in constant currencies, and totaled EUR 1,490 million (1,322 million)
• Services sales grew 10%, or 18% in constant currencies, and totaled EUR 864 million (786 million)
• Adjusted EBITA was EUR 176 million, or 11.8% of sales (136 million, or 10.3%)
• Operating profit (EBIT) up 40%, totaling EUR 167 million, or 11.2% of sales (119 million, or 9.0%)
• Earnings per share were EUR 0.71 (0.47)
• Free cash flow was EUR 23 million (43 million)
   

Key figures

EUR million	Q2/2018	Q2/2017	Change %	H1/2018	H1/2017	Change %	2017
Orders received	853	749	14	1,712	1,482	16	2,982
Orders received by the services business	463	431	7	954	882	8	1,717
% of orders received	54	58		56	60		58
Order backlog at the end of the period				1,601	1,411	13	1,439
Sales	776	675	15	1,490	1,322	13	2,699
Sales of the services business	442	403	10	864	786	10	1,595
% of sales	57	60		58	59		59
Earnings before interest, tax and amortization (EBITA), adjusted	91	70	30	176	136	29	244
% of sales	11.7	10.4		11.8	10.3		9.0
Operating profit (EBIT)	86	60	45	167	119	40	218
% of sales	11.1	8.9		11.2	9.0		8.1
Earnings per share, EUR	0.38	0.24	58	0.71	0.47	51	0.68
Free cash flow	21	4	425	23	43	-47	158
Return on capital employed (ROCE) before taxes, annualized, %				16.8	11.1		10.3
Equity-to-assets ratio at the end of the period, %				47.0	45.9		44.5
Net gearing at the end of the period, %				13.7	7.5		1.8
Personnel at the end of the period				12,708	11,788	8	12,037

Market outlook

The outlook represents expected sequential market development with a rolling six-month view. 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 level off for Flow Control

Previous market outlook (published April 25, 2018)

Our market conditions are expected to develop as follows:

• Growth in demand to remain stable for Minerals equipment and services
• Growth in demand to remain stable for Flow Control equipment and services

Interim President and CEO Eeva Sipilä:

We saw continued healthy market activity across our businesses and were particularly pleased to see the project activity in the mining equipment market increase during the second quarter. The solid growth in both equipment and services is a clear indication of our strong position in our key markets. The recent increased uncertainty relating to global trade is something we are obviously watching closely. However, we currently estimate the direct impact of the tariffs enforced so far on Metso to be limited.

Going forward, we will continue to focus on operational excellence as well as on implementing Metso's other strategic fundamentals. We are moving forward with our Digital Strategy and currently successfully piloting comminution analytics at customer sites in North America, Africa, and Australia. We are also taking R&D plans forward across our portfolio to strengthen our offering further. Also, our work on adjacent acquisitions supporting our growth strategy continues. Overall, while we have a lot of areas of further improvement ahead of us, I am encouraged by the results we have achieved during the first six months of the year.

Audiocast and conference call

Metso's Interim President and CEO Eeva Sipilä will present the financial results in a webcast and conference call for analysts and investors, held in English, today at 1 p.m. EEST. Webcast is viewable at www.metso.com/latestreports.

Conference call participants are requested to dial in five minutes before the event on:
United States: +1 929 477 0338
other countries: +44 (0)330 336 9104

The confirmation code is 800906. A recording and a transcript will be available at www.metso.com/latestreports after the event has finished.

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