Alfa Laval’s (OMX: ALFA) Q4 sales grew be a healthy 14% to 8.1 billion SEK and since operating margin was 17%, operating profit was 1.4 billion. While the sales can be deemed quite satisfactory, lower margin and particularly 15% lower order intake when compared to Q3 caused a sell-of.
Lower demand from shipbuilding industry and longer decision times were the main causes behind the order decline. To be fair the orders were still up by 6% year-on-year at 6.77 billion. Measures to adapt to a lower production pace, higher share of project deliveries in investments in BRIC contributed to lower operating margin.
Full year numbers were an order intake of over 28.5 billion, net sales in the same region, net income of 3.25 billion and EPS of 7.68. The Board proposes a dividend of 3.25 SEK a share plus a mandate of share repurchases up to 5 percent of issued shares.
The company expects Q1 2012 demand to be in line or slightly higher than in Q4 2011. The fourth quarter and full year 2011 report has been reviewed by the company’s auditors, see page 24 for the review report. The stock retreated over 7% in today’s session. The stock has been on quite a run for the last four months so some selling on the news should also not come as a shock.
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