Metso's Annual General Meeting, March 30, 2010: President and CEO Jorma Eloranta's review
Metso Corporation's company release, March 30, 2010 at 3:00 pm.
At Metso Corporation's Annual General Meeting starting today at 3:00 pm, President and CEO Jorma Eloranta reports that the development of Metso's operating environment during the first three months of the year is consistent with the company's expectations.
"In conjunction with the publication of the financial statements on February 8, 2010, we estimated that our operating environment would remain demanding in the first half of the year but would gradually recover. The market development during the first months of the year supports this view: The stronger demand in the mining industry and in power production during the fourth quarter of 2009 has continued to develop favorably. Also in the oil, gas and petrochemical industry - important for our automation business - and in the recycling industry, our customers' confidence in the development of the markets appears to have strengthened. Our customers are starting to invest again."
"In the construction industry and in the pulp and paper industry the outlook has not really changed, although the positive price development in pulp during recent weeks creates a foundation for the gradual start up of investments also in the pulp industry."
"All in all, positive tone in the markets has increased during the first months," Eloranta summarizes the market situation. According to Eloranta, the early-year development supports the full-year financial outlook presented in conjunction with the publication of the financial statements. In its financial statements press release on February 8, 2010, Metso estimated its net sales to remain at about the same EUR 5 billion level as in 2009 and profitability to remain satisfactory in 2010.
"As we have previously told, there have been price pressures in the markets since last summer," Eloranta notes. "This is typical when demand is lower than normal. We have been able to transfer some of the price pressures to our component and raw materials suppliers, but not in full. We estimate the price pressures to gradually ease as the market situation improves. We are improving our profitability also by continuously developing our own operations."
"Winning new, profitable orders is the top priority in all our businesses this year," Eloranta emphasizes. He points out that global megatrends - globalizing economy, the rise of emerging economies, changing demographics and sustainability - support the long-term profitable growth of Metso and its customers: "The downswing in the global economy doesn't seem to have changed their momentum."
Metso sees significant growth opportunities, especially in technology related to bioenergy production. "We are already a leading global supplier of bioenergy technology, and we have very extensive know-how in the entire process - from the handling of biofuel and solid waste to boiler technology, environmental systems and process automation. We are also developing next-generation solutions for e.g. gasification, pyrolysis and heat-treatment of biomass. We are talking about long-term development work that, according to our estimates, will yield significant business for Metso in the years ahead."
At the beginning of the meeting, Metso's Board of Directors Chairman Jukka Viinanen talked briefly about the succession issues at Metso's top management. "As you can read from the Annual Report, Metso's Board has discussed successors to Metso's top management because, in fact, within the next 12 months half of the company's Executive Team members, Jorma Eloranta, Olli Vaartimo and Bertel Langenskiöld, will turn 60 years old - the age of retirement in accordance with their executive contracts. Jorma Eloranta will retire at the end of February 2011, unless otherwise agreed upon. It has been agreed with Olli Vaartimo and Bertel Langenskiöld that they will be available until the end of June 2011. So the management renewal process is very much under deliberation, and progress in the matter will be communicated as new decisions are made. The goal is to ensure as flexible transition as possible," Viinanen notes.
Metso is a global supplier of sustainable technology and services for mining, construction, power generation, automation, recycling and the pulp and paper industries. We have about 27,000 employees in more than 50 countries. www.metso.com
For further information, please contact:
Jorma Eloranta, President and CEO, Metso Group, tel. +358 20 484 3000
Further information for investors, please contact:
Johanna Henttonen, Vice President, Investor Relations, Metso Group, tel. +358 20 484 3253
It should be noted that certain statements herein which are not historical facts, including, without limitation, those regarding expectations for general economic development and the market situation, expectations for customer industry profitability and investment willingness, expectations for company growth, development and profitability and the realization of synergy benefits and cost savings, and statements preceded by "expects," "estimates," "forecasts" or similar expressions, are forward-looking statements. These statements are based on current decisions and plans and currently known factors. They involve risks and uncertainties which may cause the actual results to materially differ from the results currently expected by the company.
Such factors include, but are not limited to:
(1) general economic conditions, including fluctuations in exchange rates and interest levels which influence the operating environment and profitability of customers and thereby the orders received by the company and their margins
(2) the competitive situation, especially significant technological solutions developed by competitors
(3) the company's own operating conditions, such as the success of production, product development and project management and their continuous development and improvement
(4) the success of pending and future acquisitions and restructuring.
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