Overcoming surprising situations
Mikael Lilius, Chair of the Board, opened the meeting with a review of the Board’s focus areas in 2017. The year will be remembered for succession planning: in late summer, President and CEO Matti Kähkönen retired, after having served the company in various roles for nearly 40 years. He was followed by the Belgian Nico Delvaux. But things don’t always go as planned and late-December, Delvaux suddenly announced that he was going to leave the company.
Although the Chair was disappointed with this personal decision, Metso has overcome the unexpected development well, and its situation going forward is good. The recruitment of a new President and CEO is on its way, and the company is in good hands, with CFO Eeva Sipilä serving as interim President and CEO. The Executive Team is fully functional, all important positions have been filled, and the strategies of the business areas are being implemented as we speak. Demand increased during 2017 and good progress was made in many projects, such as digitalization and the expansion of distribution channels. In addition, an acquisition was completed in Australia. “To achieve the profitable growth is in our own hands now,” Lilius emphasized.
Increasing openness and shareholders’ impact
The Chair also addressed the meeting with remuneration matters. In the future, international legislation will increase openness and shareholders’ rights and impact, with regard to senior managers’ remuneration. Metso will monitor the development of this legislation and will follow the say-on-pay practices of the future.
Remuneration at Metso aims to increase commitment and motivation as well as attract good employees. Eventually, with remuneration we can support value creation for shareholders. In 2017, work was focused on implementing the new organizational structure and renewing the reward indicators to increase individuals’ influence on company’s overall performance. At the end of his speech, Lilius thanked Metso’s shareholders and employees. He said that the good work will continue in 2018 to ensure that also in the future remuneration is in line with how the company creates value for its stakeholders.
Innovation is an integral part of our history and future
Eeva Sipilä, interim President and CEO, took a look at Metso’s 150-year journey, which is closely connected to the Finnish industrial history and innovations. Sipilä repeated Lilius’s words on the positive market development and after presenting the financial statements for 2017, she proceeded to talk more closely about the new organizational structure, which aims for speed and agility. “Within the Executive Team, we are united by a good team spirit and a strong belief in achieving results together,” said Sipilä.
Innovation is an integral part of Metso’s history and future. In 2017, the company introduced the markets with two new crushers: the Lokotrack Urban and the MX4 cone crusher.
As we all know, nowadays construction mainly takes place in densely populated environments. Lokotrack Urban is a next-generation mobile crushing plant for this urban crushing. The customer benefits from the increased availability of crushing time, and with Lokotrack Urban, construction in urban environments is considerably safer and much more ecological and cost-effective. Metso MX on the other hand represents entirely new technology. It cuts operating costs by around 10% and enables 10% higher uptime compared to traditional cone crushers. An entire product family, with different sizes of equipment, will be built around Metso MX in the coming years.
Innovations aren’t always products. Metso’s Life Cycle Services minimize downtime, in addition to ensuring uninterrupted production and maximizing the quality of the end product extremely safely. In 2017, Life Cycle Services’ customer project in Chile won a Mining Magazine Award in the Service and Support category. The customer’s total maintenance time decreased by an impressive 69%. We were praised for our risk management methods, in addition to our mobile management application for aspects related to health, safety, quality and the environment.
Digitalization offers endless possibilities for innovation. Many intelligent features already exist in equipment. However, we must be able to process and analyze data to implement practical improvements. When maintenance is based on actual condition, instead of assumed or average condition, and is carried out according to plan, making use of remote support, maintenance shutdowns are shorter, safer and less frequent. This leads to a more energy-efficient and productive process and creates significant, genuine added value for our customers. It’s possible to somewhat decrease product development costs during a downturn, but this is not a sustainable solution over the long term. Sipilä promised that investment would be increased in 2018.
“Dear shareholders: I’m convinced that Metso’s 150-year journey will continue as successfully as it has begun. This year, we will be working hard to ensure that we are headed towards a new period of profitable growth,” concluded Sipilä.
We would like to take this opportunity to thank our shareholders and employees for a successful AGM!