Outotec's Half year financial report 2017
OUTOTEC OYJ HALF YEAR FINANCIAL REPORT JULY 27, 2017 AT 9:00 AM
HALF YEAR FINANCIAL REPORT 2017
Good development in Minerals Processing, recovery of Metals, Energy & Water pending
"Our half year order intake improved significantly from last year, reflecting a more positive market sentiment in the mining industry. Our Minerals Processing segment, whose market activity started to improve in the second quarter last year, continued to develop well and its profitability improved.
During the reporting period, our order intake increased by 34% from last year. Service order intake was up by 15% mainly due to an increase in spare parts and shutdown services. Our sales increased by 6%; the growth came from process equipment orders in Minerals Processing. Increased sales improved our adjusted EBIT to EUR 3.5 million, but the result was weakened by lower gross margin. This was a result of sales mix, cost overruns in some project deliveries, as well as decreased sales in Metals, Energy & Water.
In the second quarter, our order intake and sales improved significantly in Minerals Processing, which together with earlier achieved cost savings more than doubled the segment's adjusted EBIT margin year-on-year from 4.1% to 8.8%. In Metals, Energy & Water, order intake, sales and adjusted EBIT declined in the second quarter. We continue actions to make this segment profitable again. The development in our new service organization was encouraging, with a 17% increase in order intake during the second quarter mainly coming from growth in spare parts and shutdown services. We will continue to further strengthen our capabilities in serving our customers and our large installed base.
During the second half of the year, market continues to offer attractive opportunities. The timing of large plant orders, however, is difficult to foresee", summarizes President & CEO Markku Teräsvasara.
Summary of key figures | Q2 | Q2 | Q1-Q2 | Q1-Q2 | Q1-Q4 | ||||
| EUR million | 2017 | 2016 | %1 | %2 | 2017 | 2016 | %1 | %2 | 2016 |
| Order intake | 286.3 | 280.7 | 2 | -1 | 604.6 | 450.9 | 34 | 30 | 1,007.7 |
| Service order intake | 130.8 | 112.2 | 17 | 11 | 245.9 | 214.1 | 15 | 9 | 443.3 |
| Order backlog at end of period | 1,035.6 | 1,017.3 | 2 | - | 1,035.6 | 1,017.3 | 2 | - | 1,002.1 |
| Sales | 272.2 | 267.6 | 2 | -1 | 540.0 | 507.4 | 6 | 3 | 1,057.9 |
| Service sales | 111.0 | 100.2 | 11 | 7 | 209.7 | 214.3 | -2 | -7 | 447.0 |
| Gross margin, % | 22.4 | 26.1 | 22.9 | 25.2 | 22.1 | ||||
| Adjusted EBIT3 | 2.3 | 4.9 | 3.5 | 0.1 | -23.0 | ||||
| Adjusted EBIT3, % | 0.9 | 1.8 | 0.6 | 0.0 | -2.2 | ||||
| EBIT | 0.8 | -0.8 | -0.0 | -13.0 | -67.7 | ||||
| EBIT, % | 0.3 | -0.3 | -0.0 | -2.6 | -6.4 | ||||
| Net cash from operating activities | -0.4 | -16.1 | -34.5 | -49.7 | -84.6 | ||||
| Earnings per share, EUR | -0.02 | -0.03 | -0.05 | -0.09 | -0.42 |
1 Change, %
2 Change in comparable currencies, %
3 Excluding restructuring and acquisition-related costs and PPA amortizations.
Financial guidance for 2017: revised on July 25
The guidance for 2017 is based on the current order backlog and market outlook as well as further cost savings.
- Sales are expected to be approximately EUR 1,100 -1,200 million, and
- Adjusted EBIT* is expected to be approximately 3 - 4 %
Previous guidance: The guidance for 2017 is based on the current order backlog and market outlook, as well as achieved cost savings.
- Sales are expected to be approximately EUR 1,050 -1,150 million, and
- Adjusted EBIT* is expected to be approximately 3 - 5%
* Excluding restructuring and acquisition-related costs, as well as purchase price allocation amortizations.
This text is a summary of Outotec's Half year financial report 2017. The full report is available as an attachment to this report.
FURTHER INFORMATION
Outotec Oyj
Markku Teräsvasara, CEO
Tel. +358 20 529 2000
Jari Ålgars, CFO
Tel. +358 20 529 2007
Rita Uotila, Vice President - Investor Relations
Tel. +358 20 529 2003, mobile +358 400 954 141
Format for e-mail addresses: firstname.lastname@outotec.com
BRIEFING/TELECONFERENCE
Date: July 27, 2017
Time: 2:00 PM
Venue: Outotec House, Rauhalanpuisto 9, Espoo, Finland
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