Outotec's interim report January-March 2019
OUTOTEC OYJ INTERIM REPORT MAY 8, 2019 AT 9:00 AM
INTERIM REPORT JANUARY-MARCH 2019
Positive signs in greenfield investments and good growth in Services
"The overall market sentiment developed positively in the first quarter. In addition to brownfield investments, we are seeing signs of increased greenfield investments in both minerals processing and metal refining technologies. Order intake was at the same good level as in the first quarter last year. I am pleased with the 22% growth in service orders and the 19% increase in equipment orders for Minerals Processing.
Sales decreased during the quarter primarily due to fewer plant and equipment deliveries, while service sales increased by 11%. Profitability clearly improved both in absolute and relative terms due to better gross margins. Cash flow was lower this quarter compared to the comparison period due to the timing of advance and milestone payments, as well as temporarily higher inventories.
I am pleased with the progress in our must-win battles that further improve our performance. These programs focus on strengthening customer focus, service business, product competitiveness, project competencies and people development.
In the reporting period, we were ranked as the 12th most sustainable company in the world in the Global 100 index for the 7th consecutive year. Our biggest contribution to the industry comes from our technologies that can significantly reduce CO2 emissions. Our R&D efforts continue to focus on developing technologies that enable customers to increase their profitability in a sustainable manner.
Negotiations concerning the ilmenite smelter project are ongoing in cooperation with the customer. We remain confident that we are provided adequately for the project.
After the end of the quarter, Outotec received a EUR 140 million greenfield mineral concentrator and gold processing plant order from Ma'aden in the Kingdom of Saudi Arabia. We have a proven track record of delivering mineral processing and metals refining plants for gold applications and a long history with Ma'aden with whom we have successfully completed several projects.
We continue to be positive about the current market outlook and reiterate our 2019 guidance for sales and adjusted EBIT," concludes President & CEO Markku Teräsvasara.
Summary of key figures
| Q1 | Q1 | Q1-Q4 | |||
| EUR million | 2019 | 2018 | %1 | %2 | 2018 |
| Order intake | 336.1 | 333.8 | 1 | 1 | 1,251.3 |
| Service order intake | 159.9 | 130.8 | 22 | 23 | 532.5 |
| Order backlog at end of period | 1,040.0 | 1,053.8 | -1 | - | 946.6 |
| Sales | 254.7 | 287.1 | -11 | -11 | 1,276.5 |
| Service sales | 114.7 | 103.0 | 11 | 13 | 496.6 |
| Gross margin, % | 27.1 | 22.8 | 15.4 | ||
| Adjusted EBIT3 | 11.0 | 7.0 | -46.2 | ||
| Adjusted EBIT3 , % | 4.3 | 2.4 | -3.6 | ||
| EBIT | 9.3 | 5.4 | -66.1 | ||
| EBIT, % | 3.7 | 1.9 | -5.2 | ||
| Net cash from operating activities | -18.3 | 68.5 | 70.4 | ||
| Earnings per share, EUR | 0.02 | 0.00 | -0.42 |
1 Change, %
2 Change in comparable currencies, %
3 Excluding restructuring- and acquisition-related items as well as PPA amortizations.
Financial guidance for 2019 reiterated
Based on the current market outlook, we expect sales to increase, and adjusted EBIT* to increase significantly from the 2018 adjusted EBIT (EUR 63.8 million), excluding the provision for the ilmenite smelter project.
*Excluding restructuring- and acquisition-related items, as well as PPA amortizations.
This text is a summary of Outotec's January-March 2019 Interim Report. 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: May 8, 2019
Time: 2:00 PM EEST
Venue: Outotec House, Rauhalanpuisto 9, Espoo, Finland
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