Positive development continued; we are again focusing on profitable growth
Metso’s favorable development continued in April-June, just as we had anticipated. The overall positive tone in the global economy and the recovery in demand continued in most of our customer industries. We succeeded in winning new sales in all our businesses around the world. Emerging markets’ share of new sales climbed to 60 percent in the second quarter – a new record!
I am happy that all our key figures improved, not only compared to the second quarter of 2009 but also from the first quarter of this year. The improvement was thanks to steadily recovering demand, our improved competitiveness and continuously strengthening global presence.
I am particularly pleased with the significant profitability improvement in our Paper and Fiber Technology segment. Measures to lighten the cost structure are finally starting to be visible also in the results. Improved capacity utilization rates contributed positively to gross profit margins. On the other hand, earnings were somewhat negatively affected as the selling, general and administrative expenses have increased, reflecting the increased demand and strengthening of our sales, marketing and other resources.
In our earnings report, we estimate that the overall positive mood in the global markets will continue despite some restlessness in the European financial markets. We are closely monitoring the situation and have so far not seen material impact on our global trading environment as evidenced by our strong order intake during the second quarter.
We have revised our net sales guidance based on positive developments, such as, our increased order backlog and the expectation that the recovery of the global economy will continue. We now estimate that our net sales in 2010 will grow about 10 percent from the EUR 5 billion level of 2009. Our profitability guidance is intact: We expect our profitability to be satisfactory.
Now it is time to again turn our attention also to longer-term issues. We will continue focusing on the key areas of our strategy, areas such as the development of the services business, our global presence and the environmental business.
Jorma Eloranta
CEO
Metso Corporation
Last updated Aug 05, 2010
