Industria
Valmet's Interim Review January 1 - September 30, 2014: Profitability continued to improve and is moving towards the targeted level
Valmet is reiterating its guidance presented on February 6, 2014 in which Valmet estimates that net sales in 2014 will decline from the 2013 level and EBITA before non-recurring items will increase in comparison with 2013.
Despite setbacks, an uneven global recovery continues. Largely due to weaker-than-expected global activity in the first half of 2014, the growth forecast for the world economy has been revised downward to 3.3 percent for this year. The global growth projection for 2015 was lowered to 3.8 percent. Downside risks have increased since the spring. Short-term risks include a worsening of geopolitical tensions. Medium-term risks include stagnation and low potential growth in advanced economies and a decline in potential growth in emerging markets. (International Monetary Fund, October 7, 2014)
Valmet is reiterating its short-term market outlook presented on July 31, 2014. Valmet estimates that activity in board and paper markets will remain on a good level. The activity in the services, pulp, energy, and tissue markets is estimated to remain satisfactory.
Valmet was successful on many fronts in the third quarter of the year. Even though the level of orders received was lower compared with the high level in the first half of the year, we have already, after three quarters of 2014, received more orders than during the full year of 2013. This is a clear indication of how customers perceive Valmet and trust us, and that we have the skills and technology to move our customers forward. This was proven again in the third quarter, as Valmet received the first OptiConcept M board production line and the first Advantage NTT tissue line orders to the USA. The orders received by the Services business line in the third quarter remained on the previous year's level.
Our profitability improved in the third quarter compared with the previous quarter. Since becoming an independent company, Valmet has been able to improve profitability every quarter and we are moving towards our targeted level. We have been able to steadily reduce our selling, general and administrative expenses, and increase our gross profit. Going forward, Valmet will continue to focus on improving profitability. After finalizing the savings program, we still have further profitability improvement potential through savings in procurement and quality, by actions to improve project and service margin, by continuing to improve cost competitiveness, and by improving product cost competitiveness to increase gross profit.
Valmet places considerable focus on developing sustainability, and on improving health and safety. During the third quarter, Valmet was included in the Dow Jones Sustainability Index, an index consisting of the world's leading companies in terms of economic, environmental and social criteria. The selection of Valmet illustrates our commitment to sustainability, and the transparency in our reporting.
Valmet will arrange a news conference in English for investment analysts, investors, and media on October 24, 2014 at 2:00 p.m. Finnish time (EET). The news conference will be held at Valmet's Head Office in Keilaniemi, Keilasatama 5, 02150 Espoo, Finland. The conference can also be followed through a live webcast at www.valmet.com/webcasts .
It is also possible to take part in the news conference through a conference call. Conference call participants are requested to dial in at least five minutes prior to the start of the conference, at 1:55 p.m. (EET), at +44 2071 928000. The participants will be asked to provide the following conference ID: 2551611.
During the webcast and conference call, all questions should be presented in English.
Hanna-Maria Heikkinen, Vice President, Investor Relations, Valmet Corporation, +358 10 672 0007
Markku Honkasalo, Chief Financial Officer, Valmet Corporation, +358 10 672 0008
VALMET CORPORATION
Markku Honkasalo
CFO
Hanna-Maria Heikkinen
VP, Investor Relations
www.valmet.com www.twitter.com/valmetglobal
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