Wärtsilä’s comparable result and order intake improved as expected

Engine and power plant manufacturer Wärtsilä published its April-June interim report.

The company’s net sales decreased to EUR 1,131 million from EUR 1,220 million in the comparison period last year. The analysts’ consensus forecast anticipates net sales of EUR 1,110.5 million. The forecast compiled by Vara Research includes the forecasts of 18 analysts, the highest of which forecasts a turnover of EUR 1,255.5 million and the lowest a turnover of EUR 1,015 million.

The company’s comparable operating profit improved to EUR 71 million from EUR 55.0 million. The analysts’ forecast was EUR 73.1 million and the forecast range was EUR 57.9-93.0 million. The reported operating profit improved to EUR 58 million from EUR 49 million.

Order intake in the second quarter improved to EUR 1,154 million from EUR 1,011 million last year. The result exactly matched the analysts’ forecast of EUR 1,154.4 million.

Basic earnings per share improved to EUR 0.06 from EUR 0.04, while analysts expected a result of EUR 0.08.

In the previous interim report, Wärtsilä estimates that the short-term demand environment will be somewhat better than in the corresponding period last year. Wärtsilä now expects the demand environment to be better in the third quarter than in the same period last year. However, prevailing market conditions make the outlook uncertain.

The market is stabilizing

President and CEO Håkan Agnevall saw signs of market stabilization and recovery in the second quarter.

“In our key energy markets, the situation leveled off, although many investments in new power plant capacity were further delayed. In the energy storage market, demand remained at a good level. In addition, the recent order for a 156 MW multi-fuel power plant in Nebraska and the launch of a 380 MW meta-energy 380 MW project in Italy show how flexible control power will enable wind and solar energy to grow in electricity systems around the world, ”says Agnevall in the review.

Demand for services good

“Demand for services was also at a good level, and customers continued to show interest in long-term contracts, creating business stability in low-volume market conditions,” Agnevall points out.

The order intake for services increased by 24 percent to EUR 604 million from EUR 486 million in the comparison period. Agnevall emphasizes that the increase in order intake came from several customer segments.

“In the shipping market, vessel orders increased, although orders in our key vessel segments remained relatively low. Restrictions related to the coronavirus pandemic, which is particularly important for the cruise industry, are still greatly affected. Demand for services has developed positively in various ship segments due to the use of vessels and the growth of revenues. The good demand for long-term service contracts is due to customers’ desire to secure the performance of their vessels, ”says Agnevall.

“We anticipate a better demand environment in the third quarter than in the same period last year. In the longer term, we see fascinating opportunities for achieving carbon neutrality in both the marine and energy industries. ”

Source: Arvopaperi by www.arvopaperi.fi.

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