The following is a summary of the Valmet Oyj (VOYJF) Q1 2024 Earnings Call Transcript:
Financial Performance:
Valmet reported Q1 orders of €1,050 million, EBITA at €121 million, and net sales of €1,212 million.
The backlog reached €3,790 million and EBITA margin stayed at 11.2%.
The Q1 orders and net sales were significantly contributed by the stable business, providing almost €110 million in EBITA.Valmet reported Q1 net working capital of around 4%, excluding the dividend liability and the acquisition of Tissue Converting.
Net debt decreased to €939 million, lowering the net debt to EBITDA ratio to 1.36. The company's total debt had an average interest rate of 4.6% at the end of Q1.
Business Progress:
Encouraging developments were reported in the Services business, with high order activity from the markets of China, North America, EMEA, and South America.
Despite the current drop in process technologies order intake, the company launched Valmet DNAe DCS system to consolidate its market position.
A focus on handling small to medium-sized projects in the Pulp sector while diversifying product offerings in the Paper business showed promise.
Valmet issued a €200 million green bond with a 4% fixed annual coupon during Q1.
Despite a decline in the Services business earnings and margins due to several factors, the company is pushing to improve the profitability of all business units.
Improvements were reported in industry conditions, fostering confidence in medium to long-term industry development.
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