Metso Corporation’s Interim Review, January 1 - September 30, 2000: SIGNIFICANT IMPROVEMENT IN PROFIT AND STRONG ORDER BACKLOG
Market demand for Metso’s products was good in January-September, and significantly better than in the corresponding period last year. Favorable economic growth in the main market areas was reflected in the new orders received, which grew by 34 percent in value. The new orders received by Metso’s fiber and paper technology were 69 percent higher, mainly due to paper machine rebuild orders in Europe and North America. The new orders of automation and control technology grew by 12 percent, especially due to the lively demand in Europe. The new orders of rock and mineral processing grew by 21 percent, although demand leveled off in the third quarter. At the end of September, Metso’s order backlog was 28 percent higher than at the end of 1999.
Profitability improved significantly in all business areas. The main contributing factors were the rationalization measures introduced previous year, increased deliveries, and higher capacity utilization rates.
The demand for Metso’s products is expected to remain good in the near future, too. “The improved profitability of the pulp and paper industry in Europe and in North America is estimated to maintain the industry’s willingness to invest, which should be reflected in fiber and paper technology and in automation and control solutions. The demand for rebuilds and spare parts and services is also expected to remain good because of the high capacity utilization rates in the pulp and paper industry,” says Heikki Hakala, President and CEO of Metso Corporation.
"Business is anticipated to increase in China, while elsewhere in Asia the improvement in the market will be slower. Signs of revival are to be seen in the South American markets, especially in the fiber technology business," says Hakala. Construction and civil engineering demand is forecast to remain good, but to level off towards the year’s end. On the other hand, mining sector investments are forecast to pick up in the main markets of South America, Australia, and southern Africa.
Metso’s profitability is expected to improve further in the final quarter of the year. Good profit development is likely to continue next year, too, due to the Corporation’s large order backlog, and the realization in full of the synergy benefits and cost savings resulting from the merger which created Metso.
Metso Corporation is a global supplier of process industry machinery and systems. Metso’s business areas are fiber and paper technology, automation and control technology, and machinery. In 1999, the net sales of Metso Corporation were EUR 3.4 billion, and the personnel totaled approximately 23,000. Metso Corporation is listed on the Helsinki and New York Stock Exchanges.
The full report including tables can be downloaded from the enclosed link.