Lately blowout reports have been treated with a run-up going into the report and then a pop on the news followed by a heavy profit taking sell-off that has pushed the stock below. Helped by an improving sentiment towards the end of the week on hopes of more money printing to come helped Metso Group (OMX: MEO1V) to buck that trend following Thursday afternoon release of Q2 2012 accounts. Net sales growth of 21% and profit above all estimates certainly did not hurt either. Services sales already represent almost half of the 1.9 billion of net sales. Quarterly earnings reached 0.70 Euros.
Comparison period included major orders so the order intake looks worse than it actually is. The 1.735 billion Euros worth of orders received did not include any major ones and is pretty much on par with 2010 Q2. Guidance is maintained, with net sales expected to grow from 2011 and EBITA before non-recurring items to improve.
Current demand is relatively stable but the company remains vigilant. Mining equipment, project and services demand is excellent, construction capital and services demand satisfactory as is power segment demand, automation demand is good where as pulp mill market activity is satisfactory while paper and board machines demand is weak but services activity for existing facilities is good. Metso’s share regained 30 Euro plateau on the heels of this report.
Showing posts with label Metso. Show all posts
Showing posts with label Metso. Show all posts
Saturday, 28 July 2012
Tuesday, 24 July 2012
Valmet to start making Mercedes Benz A-Class in Finland
Valmet Automotive Inc. and Daimler AG (FWB: DAI) said that the Finnish car maker will start to manufacture new Mercedes-Benz A-Class cars in Uusikaupunki, Finland to satisfy expected high demand. This should allow Valmet Automotive to call back some 300-400 laid-off employees and possibly add hundreds more from 2014 onwards. Valmet is majority owned by Metso (OMXH: MEO1V) with Pontos Group and Finnish Industry Investment holding the remaining 34%.
The parties are expected to finalize their contract this year and more than 100 000 Mercedes vehicles are planned to be manufactured in Uusikaupunki from 2013 to 2016. Daimler says there are already 40 000 orders for the cars and it will need more manufacturing capacity in addition to its own facilities in Rastatt, Germany. Kecskemét, Hungary plant is also already operating at full capacity and both facilities now have other products in the pipeline. Expected launch of the new A-Class Benz is in September.
The parties are expected to finalize their contract this year and more than 100 000 Mercedes vehicles are planned to be manufactured in Uusikaupunki from 2013 to 2016. Daimler says there are already 40 000 orders for the cars and it will need more manufacturing capacity in addition to its own facilities in Rastatt, Germany. Kecskemét, Hungary plant is also already operating at full capacity and both facilities now have other products in the pipeline. Expected launch of the new A-Class Benz is in September.
Monday, 4 June 2012
Metso order news
Metso Oyj (OMX: MEO1V) will deliver biggest mining cones crushers it has built to Codelco to be used in the world’s largest open pit copper mine, the Finnish engineering company said today. The operational weight of a single crusher exceeds 150 tonnes and has the ability to process up to 1800 tonnes of ore per hour in secondary position. The order value is more than 9 million Euros. Chuquicamata mine is located in the Atacama Desert in Northern Chile. Over its long operations, many Nordic workers have become very familiar with the working conditions over there.
Last week the company noted it will supply a board machine rebuild for SCA’s (OMX: SCA) Piteå mill. This will increase the annual capacity of the mill’s value added white top kraftliner products by 55 000 tonnes to 165 000 tonnes in total. The company also said it will also acquire full ownership of the heat and power plants supplier MW power joint venture by buying out Wärtsilä’s (OMX: WRT1V) 40% stake subject to required approvals.
Last week the company noted it will supply a board machine rebuild for SCA’s (OMX: SCA) Piteå mill. This will increase the annual capacity of the mill’s value added white top kraftliner products by 55 000 tonnes to 165 000 tonnes in total. The company also said it will also acquire full ownership of the heat and power plants supplier MW power joint venture by buying out Wärtsilä’s (OMX: WRT1V) 40% stake subject to required approvals.
Thursday, 26 April 2012
Metso down despite earnings beat
Engineering group Metso (OMX: MEO1V) which provides equipment and services to pulp & paper, energy, and mining sector companies in particular reported quarterly earnings today. Net sales grew by 22% vs. Q1 2011 to 1.85 billion Euros. EBITA grew in low double digits to 140 million and earnings per share were up slightly at 0.56 EUR. Order intake of 1.9 billion can certainly be characterized as strong.
The company expects demand to continue strong in most business areas although with significant variations in between different geographies. Pulp & Paper sector activity is expected to slow somewhat. Services demand overall is supposed to be strong.
It is difficult to find one underlying reason behind today’s stock price action, Metso did after all retreat almost 5%. It would seem that even though the numbers appear to be slightly better than consensus, individual investors focusing on the individual negative comments. The margin development is perhaps the biggest of those and it has appeared in many of these early engineering sector reports. This has inspired some people to call a top.
The company expects demand to continue strong in most business areas although with significant variations in between different geographies. Pulp & Paper sector activity is expected to slow somewhat. Services demand overall is supposed to be strong.
It is difficult to find one underlying reason behind today’s stock price action, Metso did after all retreat almost 5%. It would seem that even though the numbers appear to be slightly better than consensus, individual investors focusing on the individual negative comments. The margin development is perhaps the biggest of those and it has appeared in many of these early engineering sector reports. This has inspired some people to call a top.
Monday, 16 April 2012
Finpro: China wants to renew paper factories
Finpro, which aims to help Finnish companies in international markets, said in a press release that China is eager to use Finnish know-how to upgrade its paper plants. The organization formerly known as Finnish Export Association said that China plans to renew its pulp and paper manufacturing and will increase production by over 30% in connection with the latest five-year plan.
Finpro and Finnish Technology Industries have started a project to bring Finnish technology expertise in the field together in a single entity to take into the Chinese market. Investments of up to 40 billion Euro may be made for some 30-50 new paper machines in existing factory locations and modernization of old equipment. Of course a headline number in one thing and the actual rewards reaped from such projects are always very uncertain.
Metso (OMX: MEO1V) is seen as the most likely beneficiary of continued investments in the field in China. The company is already doing large-scale business there and its stock market value reflects expectations of continued strong order inflow. Metso advanced 1% today.
Finpro aims to focus on aiding smaller companies to be able to take part in the push. Vaahto Group (HEL: WAT1V) was down over 10% in a continued sell-off after it reported of 2.9 million Euro operating loss for 1 September 2011-29 February 2012 period on Friday.
Many Chinese travelling to the Nordic region notice the superior quality of local paper as one of the very few things that clearly stands out compared to home. In historical context this is of course somewhat perplexing. I personally have been asked by several local commercial chambers in the Middle Kingdom on the matter and what it would take for them to be able to get into projects alleviating the situation as well in the years past during my long stays there.
While it is possible to acquire quality paper in China, it tends to be pretty expensive (the moister environment in the Southern regions also affects perception). The raw material availability is typically a concern for pulp mills, something what the companies have been tackling with large scale plantations and raw timber imports from Russia.
Of course pulp is also imported particularly from South America and companies from Nordic regions take part in that trade. Coated paper imports have already been declining so the impact on Nordic pulp & paper sector companies in general is ambiguous depending on the actual investment mix and how the particular company is positioned.
Finpro and Finnish Technology Industries have started a project to bring Finnish technology expertise in the field together in a single entity to take into the Chinese market. Investments of up to 40 billion Euro may be made for some 30-50 new paper machines in existing factory locations and modernization of old equipment. Of course a headline number in one thing and the actual rewards reaped from such projects are always very uncertain.
Metso (OMX: MEO1V) is seen as the most likely beneficiary of continued investments in the field in China. The company is already doing large-scale business there and its stock market value reflects expectations of continued strong order inflow. Metso advanced 1% today.
Finpro aims to focus on aiding smaller companies to be able to take part in the push. Vaahto Group (HEL: WAT1V) was down over 10% in a continued sell-off after it reported of 2.9 million Euro operating loss for 1 September 2011-29 February 2012 period on Friday.
Many Chinese travelling to the Nordic region notice the superior quality of local paper as one of the very few things that clearly stands out compared to home. In historical context this is of course somewhat perplexing. I personally have been asked by several local commercial chambers in the Middle Kingdom on the matter and what it would take for them to be able to get into projects alleviating the situation as well in the years past during my long stays there.
While it is possible to acquire quality paper in China, it tends to be pretty expensive (the moister environment in the Southern regions also affects perception). The raw material availability is typically a concern for pulp mills, something what the companies have been tackling with large scale plantations and raw timber imports from Russia.
Of course pulp is also imported particularly from South America and companies from Nordic regions take part in that trade. Coated paper imports have already been declining so the impact on Nordic pulp & paper sector companies in general is ambiguous depending on the actual investment mix and how the particular company is positioned.
Tuesday, 27 March 2012
Metso services contract to Kaunisvaara, Northern Sweden in focus
Metso (OMX: MEO1V) announced it has signed a six-year service contract for Kaunisvaara iron ore processing plant with Northland Resources AB (TSX: NAU, OSE: NAUR, FWB NPK). The order is valued 73 million Euros. In July 19 last year Metso announced a equipment and mill lining services order from the same customers. The most recent contract builds on that, which was also a repeat order.
The duration of the services contract is six years with tasks including technical assistance, maintenance, audits & inspections and spare parts. It is partially in 2011 Q4 order backlog and will go to Q1 2012 orders reserved for the remaining portion. The contract period starts immediately whereas services will be provided once the process line becomes operational.
International development-stage mining company Northland Resources AB is planning to establish a major iron ore province at the Pajala Shear Zone in Northern parts of Sweden and Finland. The company aims to maximize the uptime of the Tapuli (the second of the two iron ore deposits at Kaunisvaara, the other being Sahavaara) process line.
The contract is a cost per ton-type, so it gives them visibility on future plant expenditure. Kaunisvaara Project is expected to start producing high grade iron concentrate towards the end of this year and the company has said it is on track to have the first shipment on Port of Narvik in early 2013. There are off-take agreements for 100% of production in place.
Metso says it will increase its local services offering and customer services in Northern Sweden. It will be adding a service centre in Pajala to support this contract. The company already has presence in Gällivare, Kiruna and Luleå. Metso feels the region holds great potential as mining companies over there will invest in new projects in the future.
The duration of the services contract is six years with tasks including technical assistance, maintenance, audits & inspections and spare parts. It is partially in 2011 Q4 order backlog and will go to Q1 2012 orders reserved for the remaining portion. The contract period starts immediately whereas services will be provided once the process line becomes operational.
International development-stage mining company Northland Resources AB is planning to establish a major iron ore province at the Pajala Shear Zone in Northern parts of Sweden and Finland. The company aims to maximize the uptime of the Tapuli (the second of the two iron ore deposits at Kaunisvaara, the other being Sahavaara) process line.
The contract is a cost per ton-type, so it gives them visibility on future plant expenditure. Kaunisvaara Project is expected to start producing high grade iron concentrate towards the end of this year and the company has said it is on track to have the first shipment on Port of Narvik in early 2013. There are off-take agreements for 100% of production in place.
Metso says it will increase its local services offering and customer services in Northern Sweden. It will be adding a service centre in Pajala to support this contract. The company already has presence in Gällivare, Kiruna and Luleå. Metso feels the region holds great potential as mining companies over there will invest in new projects in the future.
Sunday, 12 February 2012
Metso: order inflow stalls in Q4
Finnish engineering group Metso (OMX: MEO1V) reported earnings on Thursday. Orders received in 2011 were a new record for the company but a major drop in them during Q4 worried investors. Total orders grew from close to 6 billion in 2010 to nearly 8 billion in 2011. However in Q4 the process industry machinery supplier booked just 1.3 billion of them, which is 12% below Q4 2010 number.
Net sales in Q4 were just under 2.1 billion and earnings per share stood at 0.81. Free cash flow was a mere 45 million. Full-year sales were over 6.6 billion, EBITA exactly 628,5 million and EPS 2.38. Free cash flow was 14% lower than in 2010 at 375 million Euros. Board of Directors proposes a dividend increase of 10% to 1.70 Euros. This is 71% of 2011 earnings. The Board may also propose an extra dividend, situation permitting, at a later date.
Guidance for 2012 reflects the current 4 billion Euros strong order backlog. It is 2013 that the markets are worried about now. On Friday an 80 million Euro order to supply a containerboard machine for Kipas Kagit Sanayi Isletmeleri A.S’s new mill in Kahramanmaras, Turkey provided some relief. Assuming that current economic situation persist, Metso expects 2012 sales grow compared to 2011 and EBITA before non-recurring items to improve.
Mining and Construction Technology segment has been the star performer lately. Underlying demand is expected to remain good although Metso does not expect as many large orders in the beginning of 2012 as last year. Services demand is expected to remain good. Demand for automation products is expected to be good in early 2012 while pulp & paper industry activity is expected to slow down somewhat. Demand for power plants using renewable energy sources should benefit from continuous need to replace old energy sources and new capacity.
Net sales in Q4 were just under 2.1 billion and earnings per share stood at 0.81. Free cash flow was a mere 45 million. Full-year sales were over 6.6 billion, EBITA exactly 628,5 million and EPS 2.38. Free cash flow was 14% lower than in 2010 at 375 million Euros. Board of Directors proposes a dividend increase of 10% to 1.70 Euros. This is 71% of 2011 earnings. The Board may also propose an extra dividend, situation permitting, at a later date.
Guidance for 2012 reflects the current 4 billion Euros strong order backlog. It is 2013 that the markets are worried about now. On Friday an 80 million Euro order to supply a containerboard machine for Kipas Kagit Sanayi Isletmeleri A.S’s new mill in Kahramanmaras, Turkey provided some relief. Assuming that current economic situation persist, Metso expects 2012 sales grow compared to 2011 and EBITA before non-recurring items to improve.
Mining and Construction Technology segment has been the star performer lately. Underlying demand is expected to remain good although Metso does not expect as many large orders in the beginning of 2012 as last year. Services demand is expected to remain good. Demand for automation products is expected to be good in early 2012 while pulp & paper industry activity is expected to slow down somewhat. Demand for power plants using renewable energy sources should benefit from continuous need to replace old energy sources and new capacity.
Friday, 16 December 2011
Plenty of news, Nordic stocks in the black on Thursday
H & M Hennes & Mauritz AB (STO: HM B) November 2011 sales decreased by 1% in comparable units. Total sales were up by 9%. In one year the company added 266 new stores to bring the number up to a total of 2472. Fourth quarter sales were over 36.1 billion SEK including VAT (unaudited, 30.9 billion VAT excluded). The numbers were below expectations. Retailers have blamed warmer than expected weather for sluggish sales as of late. H&M gained 1% in today’s session on high volume.
CEO Magnus Hall of Swedish paper firm Holmen (OMX: HOLM B) told Reuters news agency that orders for paperboard and printing paper remain weak and may fall further in the short term, where as market for timber is already so weak that Hall does not think it can get much worse.
Metso Corporation (OMX: MEO1V) will supply world’s first commercial installation of LignoBoost technology to Domtar’s Plymouth North Carolina pulp mill in USA. LignoBoost separates and collects lignin from pulping liquor and Metso feels this order is an important breakthrough for the adobtation of the technology.
Biotechnology company NorDiag ASA (OSE: NORD) more than doubled its stock market value in a day. The news that its US subsidiary NorDiag Inc entered into a five-year distribution agreement with AutoGen Inc, wherein AutoGen will distribute NorDiag’s products to North American Life Science market was the catalyst. Financial details weren’t disclosed but NorDiag expects a significant sales impact from 2012 and beyond.
As a continuation of the news from the other day on confirmed Pancreas Disease in Central Norway, Salmar ASA (OSE: SALM) said a confirmed detection of the disease has been made in one of its sites. The site has 2 million fish, with around half a million of them vaccinated against PD, and a book value of 50 million NOK. Salmar’s stock price was down slightly.
Scana Industrier (OSE: SCI) shot down 20% after a trading halt this morning. The company announced plans for a fully guaranteed rights issue for 120 million new shares. The existing shareholders shall have pre-emptive rights with non-tradable rights. Eight largest shareholders and two other shareholders are behind the full guarantee. The company is also negotiating on a new three year bank facility to replace the outstanding multi-currency term loan and revolving credit facility from 2007 with maturity in October 2012. The price action in the past couple of months suggests this did not come as a terrible surprise. Scana recovered in late trading to finish the day down by 4%.
Electromagnetic Geoservices ASA (OSE: EMGS) and world’s largest oilfield service company Schlumberger intend to enter into a cooperative agreement from January 3 2012 onwards. The parties will offer their expertise in marine electromagnetic related fields of processing, advanced modelling and earth model building and Schlumberger will withdraw from the ongoing patent disputes. The companies will cross-license patents relevant to the CSEM acquisition business. EMGS ended the day up by more than 12%.
Christmas sales reports from Nordic countries are mixed, with some chains already offering discounts that traditionally start after holidays. Finnish retailing conglomerate Kesko (OMX: KESB) managed to grow sales by 7.4% in November.
CEO Magnus Hall of Swedish paper firm Holmen (OMX: HOLM B) told Reuters news agency that orders for paperboard and printing paper remain weak and may fall further in the short term, where as market for timber is already so weak that Hall does not think it can get much worse.
Metso Corporation (OMX: MEO1V) will supply world’s first commercial installation of LignoBoost technology to Domtar’s Plymouth North Carolina pulp mill in USA. LignoBoost separates and collects lignin from pulping liquor and Metso feels this order is an important breakthrough for the adobtation of the technology.
Biotechnology company NorDiag ASA (OSE: NORD) more than doubled its stock market value in a day. The news that its US subsidiary NorDiag Inc entered into a five-year distribution agreement with AutoGen Inc, wherein AutoGen will distribute NorDiag’s products to North American Life Science market was the catalyst. Financial details weren’t disclosed but NorDiag expects a significant sales impact from 2012 and beyond.
As a continuation of the news from the other day on confirmed Pancreas Disease in Central Norway, Salmar ASA (OSE: SALM) said a confirmed detection of the disease has been made in one of its sites. The site has 2 million fish, with around half a million of them vaccinated against PD, and a book value of 50 million NOK. Salmar’s stock price was down slightly.
Scana Industrier (OSE: SCI) shot down 20% after a trading halt this morning. The company announced plans for a fully guaranteed rights issue for 120 million new shares. The existing shareholders shall have pre-emptive rights with non-tradable rights. Eight largest shareholders and two other shareholders are behind the full guarantee. The company is also negotiating on a new three year bank facility to replace the outstanding multi-currency term loan and revolving credit facility from 2007 with maturity in October 2012. The price action in the past couple of months suggests this did not come as a terrible surprise. Scana recovered in late trading to finish the day down by 4%.
Electromagnetic Geoservices ASA (OSE: EMGS) and world’s largest oilfield service company Schlumberger intend to enter into a cooperative agreement from January 3 2012 onwards. The parties will offer their expertise in marine electromagnetic related fields of processing, advanced modelling and earth model building and Schlumberger will withdraw from the ongoing patent disputes. The companies will cross-license patents relevant to the CSEM acquisition business. EMGS ended the day up by more than 12%.
Christmas sales reports from Nordic countries are mixed, with some chains already offering discounts that traditionally start after holidays. Finnish retailing conglomerate Kesko (OMX: KESB) managed to grow sales by 7.4% in November.
Thursday, 28 July 2011
Metso misses
Metso (OMX: MEO1V) joined a growing list of companies reporting somewhat decent earnings that are nevertheless weaker than consensus estimates and strong Q2 2010 and thus get severely punished in the market.
Net sales were up 14% but operating earnings were down by nearly the same percentage. Free cash flow was down more notably to 49 million (164 million). Comparable EBITA increased by 12 percent. Second quarter order intake was an all time high; 2.883 billion Euros worth of orders were received in April-June, a 73% increase to Q2 2010.
Guidance for the year remains unchanged: 15% net sales growth and improved profitability. Metso’s stock retreated 8% to 34,58 Euro. More information is available on the company’s report site.
Net sales were up 14% but operating earnings were down by nearly the same percentage. Free cash flow was down more notably to 49 million (164 million). Comparable EBITA increased by 12 percent. Second quarter order intake was an all time high; 2.883 billion Euros worth of orders were received in April-June, a 73% increase to Q2 2010.
Guidance for the year remains unchanged: 15% net sales growth and improved profitability. Metso’s stock retreated 8% to 34,58 Euro. More information is available on the company’s report site.
Thursday, 14 July 2011
Some Finnish heavy industry news in brief
Talvivaara Mining Company (OMX: TLV1V, LSE:TALV) will replace IT service company Tieto (HEL: TIE1V, OMXS: TIEN) in OMXH25 list on August 1, 2011.
Outotec (OMXH: OTE1V) received an order worth roughly 50 million Euros from Maaden Bauxite Alumina Company (JV of Saudi Arabian Mining Company (Maaden) and Alcoa) in Saudi Arabia. It will deliver alumina calcination technology, precisely two calciners to integrated aluminum complex at Ras Al Khair.
Metso (OMX: MEO1V) has received numerous large orders in last few days. Today the company said it is to provide mill maintenance to Amcor in Australia. Yesterday the company said it will supply minerals processing equipment to Taigang Group Lanxian Mining Co. Ltd. (TISCO) in China. On Tuesday Metso said it will deliver CHP boiler plants to Fortum (OMX: FUM1V) in Finland and in Latvia. And finally on Monday the company said it will perform replacement of chemical recovery boiler of UBE chemicals in Thailand.
Outotec (OMXH: OTE1V) received an order worth roughly 50 million Euros from Maaden Bauxite Alumina Company (JV of Saudi Arabian Mining Company (Maaden) and Alcoa) in Saudi Arabia. It will deliver alumina calcination technology, precisely two calciners to integrated aluminum complex at Ras Al Khair.
Metso (OMX: MEO1V) has received numerous large orders in last few days. Today the company said it is to provide mill maintenance to Amcor in Australia. Yesterday the company said it will supply minerals processing equipment to Taigang Group Lanxian Mining Co. Ltd. (TISCO) in China. On Tuesday Metso said it will deliver CHP boiler plants to Fortum (OMX: FUM1V) in Finland and in Latvia. And finally on Monday the company said it will perform replacement of chemical recovery boiler of UBE chemicals in Thailand.
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