The increase in sales in Q3 2019 was mainly attributable to the Pulp & Paper business area, where sales increased strongly by 46.1 per cent compared to previous year. Both the Capital and Service business recorded a significant increase in sales due to favourable development of order intake in the past few quarters. The Metals (+5.6 per cent) – especially Metals Processing – and Separation (+2.2 per cent) business areas were also able to increase sales slightly compared to the previous year. The Hydro business area saw a slight decline (-2.8 per cent) in sales due to decrease in order intake in the past few years.
Xerium Technologies, Inc, which was consolidated as from October 2018, contributed around €111 to the sales in Q3 and around €333 million in the first three quarters of 2019.
The order intake of the group saw a very positive development – driven above all by the very positive development in the Pulp & Paper business area in the third quarter of 2019. At €2,093.9 million, it was 42.6 per cent higher than the figure for the previous year’s reference period (Q3 2018: €1,468.7 million).
Order intake for the business area Hydro at €343.0 million, was 13.2 per cent higher than the low figure for the previous year’s reference period (Q3 2018: €303.1 million). For Pulp & Paper business area, the order intake, at €1,163.3 million, reached the second highest quarterly figure in the company’s history. It was thus more than twice as high as the previous year’s reference figure (+113.3 per cent versus Q3 2018: €545.5 million).
In Metals, at €429.0 million, the order intake reached a solid level in view of the unchanged, difficult market conditions and was slightly below the figure for the previous year’s reference period (-6.0 per cent versus Q3 2018: €456.6 million). In Separation, order intake amounted to €158.6 million and was thus only slightly below the figure for the previous year’s reference period (-3.0 per cent versus Q3 2018: €163.5 million).
In the first three quarters of 2019, the Group’s order intake of €5,799.1 million, was significantly higher than in the previous year’s reference period (+22.4 per cent versus Q1-Q3 2018: €4,738.0 million). While order intake in the Pulp & Paper business area saw a sharp increase – above all due to the award of some large-scale orders to build new pulp mills, order intake in the Metals and Hydro business areas was significantly below the level of the previous year. Order intake in the Separation business area was also below the previous year’s reference period, which, however, included a large-scale order in the solid/liquid separation sector in China.
The Andritz Group does not expect any significant changes in the markets it serves for the remaining months of 2019. In the Pulp & Paper business area, unchanged good project and investment activity is anticipated in both the capital and the service sector. Continuing moderate project and investment activity – especially in modernisation and rehabilitation projects – is expected in the Hydro business area. Selective award of individual large-scale projects is likely.
In the Metals business area, the low investment activity of international car manufacturers and their suppliers is expected to continue in the Metals Forming sector (Schuler). Moderate project and investment activity is also anticipated in the Metals Processing sector (plants for production and finishing of steel strip).
Continuing solid project and investment activity is expected for the Separation business area. Regarding the expectations for the 2019 business year, Andritz confirms its guidance and expects a significant increase in sales compared to the previous year.
In terms of profitability, Andritz expects a largely unchanged operative EBITA margin before extraordinary effects (EBITA margin 2018 before extraordinary effects: 6.9 per cent). However, if the global economy suffered a major setback in the coming months, this could also have a negative impact on Andritz’s business development.
In addition, possible further capacitive adjustments that are necessary due to the market environment in individual business areas may result in financial measures for capacity reductions. These provisions could have a negative effect on the Andritz Group's earnings.
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