First half (H1) sales totalled €1,935m, slightly down from €1,963m in January to June 2020, while operating profit was €188m, or 9.7% of sales (€158m or 8.0% in H1 2020).
Metso Outotec president and CEO Pekka Vauramo commented: "During the second quarter, we saw continued positive market development as well as good progress in our integration and sustainability actions. Market activity, which started to improve in late 2020, was strong in all our segments and translated into an order growth of 43% in the second quarter."
Vauramo added that the aggregates business has enjoyed a robust recovery of infrastructure investments in Europe and in the US, and quarterly orders were higher than in the first quarter.
The minerals and metals segments had a steady flow of small and mid-size orders, and in addition, received a few larger orders.
"Importantly, we have won many of these orders thanks to our Planet Positive portfolio, which is designed to help our customers to improve the sustainability and productivity of their operations," said Vauramo. "The pandemic continues to limit the opportunities in the services business, as restrictions to site access are in place in some markets. On the other hand, in those markets, where the situation has eased, activity related to on-site service work is increasing."
He added that the Metso Outotec integration has proceeded ahead of plan, and as of the end of June the group had achieved €105m in cost synergies. This compares to its target of €120m synergies at the end of 2021, which the group is confident it will meet.
Revenue synergies are also materialising, and Vauramo said the backlog related to revenue synergies stood at €91m at the end of June.
"In addition to the integration, we are making progress on our portfolio streamlining with the divestments of the aluminium business and most recently the waste recycling business," he said.
Sales in the second quarter of 2021 were flat year-on-year, despite the strong growth in the aggregates segment. The minerals and metals segments are, as expected, impacted by timing of deliveries in our backlog being weighted to the second half of the year.
Vauramo said that the rapid economic recovery has put pressure on global supply chains and logistics, and as this has coincided with the implementation of Metso Outotec's internal footprint and warehouse consolidation, it resulted in delivery delays in its minerals business.
The group has implemented corrective actions and says it will be able to deliver more efficient and sustainable logistics to its customers. Lower sales affected minerals’ profitability, while aggregates achieved a stronger adjusted EBITA margin than ever before. Metso Outotec says the profitability of the metals segment turned to positive thanks to the successful turnaround actions.
Looking forward to the second half of the year Vauramo said: "We expect to see further recovery from the pandemic and our customers being active in their ongoing operations and future investments. Sustainability is becoming one of the top priorities for consumers and industries and it is a strategic priority for us as well. Thanks to this approach, we are confident that we are well-positioned and have the most comprehensive offering to help our customers to meet their sustainability and productivity targets."
The Covid-19 pandemic continued to affect Metso Outotec’s end markets and customer operations during January-June 2021. Restrictions on workforce mobility and limited access to customer sites were still effective in the second quarter in several countries, while in some other markets, such as North America and Australia, domestic travel has recovered enabling an increase in customer activity related to on-site work. Metso Outotec’s own operations have continued to run with additional health and safety measures and without major disruptions.
Metso Outotec says it expects the market activity to remain at the current strong level, subject to the development of the Covid-19 pandemic.
