Metso Financial Statements Review 2017 presentation

Metso Financial Statements Review 2017 presentation

• 1.
  2017 Q4 and full-year results January1 – December 31, 2017
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  © Metso2 Forward lookingstatements It should be noted that certain statements herein which are not historical facts, including, without limitation, those regarding expectations for general economic development and the market situation, expectations for customer industry profitability and investment willingness, expectations for company growth, development and profitability and the realization of synergy benefits and cost savings, and statements preceded by ”expects”, ”estimates”, ”forecasts” or similar expressions, are forward looking statements. These statements are based on current decisions and plans and currently known factors. They involve risks and uncertainties which may cause the actual results to materially differ from the results currently expected by the company. Such factors include, but are not limited to: 1) general economic conditions, including fluctuations in exchange rates and interest levels which influence the operating environment and profitability of customers and thereby the orders received by the company and their margins 2) the competitive situation, especially significant technological solutions developed by competitors 3) the company’s own operating conditions, such as the success of production, product development and project management and their continuous development and improvement 4) the success of pending and future acquisitions and restructuring. Q4/2017 and full-year 2017 results
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  © Metso Q4/2017and full-year 2017 results3 Q4/2017 in brief Healthy market activity Good overall performance in Flow Control Lower mining orders and sales, and weaker profitability in Minerals Acquisition of WEARX in Australia Expansion of the aggregates and flow control distribution network continued
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  © Metso Group quarterlyfinancials 4 Q4/2017 and full-year 2017 results Orders received +2% (+5% in constant currencies) to EUR 684 million Sales grew 5% (+8% in constant currencies) to EUR 710 million Adjusted EBITA was EUR 64 million or 9.1% (64 million or 9.4%) Operating profit was EUR 60 million or 8.4% (44 million or 6.6%) Earnings per share were EUR 0.08 (EUR 0.17) Free cash flow totaled EUR 57 million (EUR 97 million) Orders, sales and profitability 0 2 4 6 8 10 12 14 16 18 0 100 200 300 400 500 600 700 800 900 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Orders received, EUR million Sales, EUR million Adjusted EBITA %
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  © Metso Minerals quarterlyfinancials 5 Q4/2017 and full-year 2017 results Orders declined 2% (+2% in constant currencies) - Solid aggregates and recycling - Timing and tighter controls on terms and conditions in mining Sales increased 3% (+6% in constant currencies) - Driven by aggregates equipment - Mining flat Adjusted EBITA margin was 8.9% ( 9.1%) - Unfavorable sales mix between equipment and services - Unfavorable sales mix within services - Margin pressure in consumables - Constraints in the services supply chain Orders, sales and profitability 0 2 4 6 8 10 12 14 0 100 200 300 400 500 600 700 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Orders received, EUR million Sales, EUR million Adjusted EBITA %
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  © Metso Flow Controlquarterly financials 6 Q4/2017 and full-year 2017 results Orders increased 15% (+19% in constant currencies) - Strong performance for both equipment and services Sales increased 10% (+14% in constant currencies) - Higher growth in equipment than in services Adjusted EBITA margin 15.6% (16.6%) - Good performance despite unfavorable mix Orders, sales and profitability 0 4 8 12 16 20 0 40 80 120 160 200 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Orders received, EUR million Sales, EUR million Adjusted EBITA % Note: The definition of Flow Control’s services business was changed as of January 1, 2018. Based on the new definition, services sales in 2017 would have been EUR 227 million, or 36% of total sales and services orders in 2017 would have been EUR 243 million, or 36% of total orders.
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  © Metso Income statement EURmillion Q4/2017 Q4/2016 Change % Q1-Q4/ 2017 Q1-Q4/ 2016 Change % Orders received 684 672 2% 2,982 2,724 9% Orders received, services business 435 442 -2% 1,897 1,741 9% Sales 710 676 5% 2,706 2,586 5% Sales, services business 458 442 4% 1,767 1,703 4% Adjusted EBITA 64 64 1% 244 274 -11% % of sales 9.1 9.4 9.0 10.6 Operating profit 60 44 34% 218 227 -4% % of sales 8.4 6.6 8.1 8.8 Profit for the period 12 25 -52% 102 130 -22% Earnings per share, EUR 0.08 0.17 -53% 0.68 0.87 -22% Return on capital employed before taxes, %, annualized 10.3 10.4 Note: EPS was affected by one-time tax-related items totaling EUR 29 million 7 Q4/2017 and full-year 2017 results
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  © Metso Balance sheet EURmillion Dec 31, 2017 % of total Dec 31, 2016 % of total Intangible assets 545 16.6% 538 16.6% Tangible assets 287 8.7% 315 9.7% Financial and other assets 130 4.0% 157 4.9% Inventories 750 22.8% 709 21.9% Receivables 631 27.5% 605 18.7% Current financial assets 271 5.1% 214 6.6% Cash and cash equivalents 673 20.5% 698 21.6% TOTAL ASSETS 3,287 3,236 Total equity 1,351 41.1% 1,439 44.5% Interest-bearing liabilities 854 26.0% 794 24.5% Non-interest-bearing liabilities 1,082 32.9% 1,003 31.0% TOTAL EQUITY AND LIABILITIES 3,287 3,236 8 Q4/2017 and full-year 2017 results
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  © Metso Cash flow 9Q4/2017 and full-year 2017 results EUR million Q4/2017 Q4/2016 Q1-Q4/ 2017 Q1-Q4/ 2016 Profit 12 25 102 130 Adjustments 54 47 192 170 Change in net working capital 22 55 -23 92 Financial items, paid -7 -11 -21 -25 Taxes paid -15 -8 -64 -21 Net cash provided by operating activities 65 108 185 346 Capital expenditure on fixed assets -12 -10 -38 -31 Other 0 -1 -2 0 Net cash from investments -41 -12 -66 -10 Free cash flow 57 97 158 339
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  © Metso Financial position 10Q4/2017 and full-year 2017 results Dec 31, 2017 Dec 31, 2016 Return on equity (ROE), % 7.3 9.0 Net gearing at the end of the year, % 1.8 -1.8 Cash conversion, % 155 261 Equity-to-assets ratio at the end of the year, % 44.5 48.0 Debt to capital, % 38.7 35.6 Net debt / EBITDA 0.1 -0.1 Interest cover (EBITDA) 8.0 7.4 Cash assets 673 698
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  © Metso Dividend proposalof EUR 1.05 11 * Additional dividend of EUR 0.40 was paid in August 2015 ** Board proposal for the 2018 AGM Q4/2017 and full-year 2017 results The proposed dividend totals EUR 157 million 154% of earnings per share Dividend and EPS 1.00 1.05 1.05 1.05 1.05 0.0 0.5 1.0 1.5 2.0 2.5 3.0 2013 2014 2015 * 2016 2017 ** EUR EPS (Earnings per share) DPS (Dividend per share)
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  © Metso Q4/2017and full-year 2017 results12 Market outlook Remain stable for Minerals equipment and services Remain stable for Flow Control equipment and services
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  company/metso metsogroup metsoworldmetsoworldmetsogroup www.metso.com