Metso's Interim Review, January 1 - June 30, 2001: FURTHER IMPROVEMENT IN PROFITABILITY
- Metso's net sales for January-June were EUR 2,019 million (1-6/2000: EUR 1,825 million).
- Operating profit was EUR 121 million (EUR 69 million).
- Income before extraordinary items and taxes was EUR 128 million (EUR 58 million).
- Earnings per share were EUR 0.61 (EUR 0.30).
- New orders totaling EUR 1,915 million (EUR 2,525 million) were received.
- The order backlog at the end of June was EUR 1,813 million (EUR 1,907 million).
The demand for Metso Paper's products was satisfactory in Europe and South America in the January-June period. Investment projects for new machines were pending mainly in China and also somewhat in Europe. The weakening of pulp and paper industry markets was reflected in the postponement of decisions regarding larger investment projects, which reduced the orders received by Metso Paper especially towards the end of the second quarter. The demand for construction and civil engineering industry products was good in Europe, except for Germany, but was weaker than last year in North America. The demand for mining industry products picked up in the southern hemisphere. The demand for Metso Automation's products was good mainly in Europe and more active than expected in certain Asian countries, but slowed down in North America.
Metso's profitability was clearly better than in the corresponding period last year. The Corporation's operating profit grew substantially, the operating profit percentage being 6.0.
The value of new orders received in January-June declined from the comparison period in 2000, due to the decline in large project orders received by the largest business area, Metso Paper. The other business areas received the same volume or more new orders than earlier. At the end of June, Metso's order backlog was 5 percent lower than at the end of last year.
In June 2000, Metso made a public offer for the acquisition of Svedala, the Swedish manufacturer of rock and mineral processing equipment. Metso received a draft of a consent decree from the U.S. Federal Trade Commission (FTC) after providing the FTC with a proposal for the sale of certain crushing and screening operations to Sandvik and the sale of grinding mill operations to Outokumpu. Metso is continuing negotiations with the FTC concerning certain aspects of these agreements. The competition authorities in other critical markets have already approved the deal, and it can be closed when the FTC clearance has been received and Metso has acquired 90 percent of Svedala's share capital.
The short-term market situation is estimated to continue as satisfactory for Metso and profitability is expected to improve this year, compared with 2000. The improvement in profitability will be due to the order backlog at the end of June, the growth in the share of service operations and the synergy benefits and cost savings of the merger that created Metso.
Metso Corporation's Interim Review for January-June.
The full report including tables can be downloaded from the enclosed link.