Wärtsilä Corporation Financial statements bulletin 2015

“A solid fourth quarter and continued growth in service volumes supported us in reaching our targets for the year 2015. Given the challenging operating environment we can be pleased with our performance.“

Jaakko Eskola,
President and CEO

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Solid development despite challenging market conditions

“A solid fourth quarter and continued growth in service volumes supported us in reaching our targets for the year 2015. Net sales grew by 5% and profitability reached 12.2%. Furthermore, the quarterly order intake in the equipment businesses improved sequentially towards year end. Given the challenging operating environment we can be pleased with our performance.

Services’ development was clearly the highlight of the year, with double digit growth in both orders and sales. Our success was driven by a focused sales approach and an enhanced value proposition, as well as by the increasing willingness of our customers to invest in performance optimising services. We will work actively to ensure the continued development of our offering in 2016. Another key focus area will be cash flow development, which this year was negatively affected by the timing of power plant deliveries.

Looking into 2016, we expect the market situation to remain similar to that seen during the previous year. The favourable development of service activity is expected to continue, while conditions in energy markets will remain challenging and the demand for new vessels limited due to overcapacity and low oil prices. Despite our cautious market outlook, we remain well positioned to benefit from the trends of increasing demand for efficiency and changing energy needs. Digitalisation will increasingly drive our business, as we utilise data analytics to further optimise our customers’ operations, and our own internal processes and performance. Based on our solid order book and project pipeline, a growing Services business and our focus on continuous improvement, we expect to see some growth in sales and operating margins in the coming year.”

jaakko-autograph.png

Jaakko Eskola, President and CEO

Wärtsilä's prospects for 2016

Wärtsilä expects its net sales for 2016 to grow by 0-5% and its operational profitability (EBIT% before non-recurring items) to be 12.5-13.0%.

Fourth quarter highlights

  • Order intake decreased 8% to EUR 1,403 million (1,522)

  • Net sales increased 3% to EUR 1,590 million (1,549)

  • Book-to-bill 0.88 (0.98)

  • EBITA EUR 224 million, or 14.1% of net sales (EUR 202 million or 13.1%)

  • Operating result before non-recurring items EUR 215 million, or 13.5% of net sales (EUR 196 million or 12.7%)

  • Earnings per share 0.79 euro (0.60)

  • Cash flow from operating activities EUR 176 million (212)

Highlights of the review period January-December 2015

  • Order intake decreased 3% to EUR 4,932 million (5,084)

  • Net sales increased 5% to EUR 5,029 million (4,779)

  • Book-to-bill 0.98 (1.06)

  • EBITA EUR 643 million, or 12.8% of net sales (EUR 594 million or 12.4%)

  • Operating result before non-recurring items EUR 612 million, or 12.2% of net sales (EUR 569 million or 11.9%)

  • Earnings per share 2.25 euro (1.76)

  • Cash flow from operating activities EUR 255 million (452)

  • Order book at the end of the period increased 8% to EUR 4,882 million (4,530)

  • Dividend proposal 1.20 euro per share

 Key figures

MEUR 10-12/2015 10-12/2014 Change 1-12/2015 1-12/2014 Change
Order intake 1 403 1 522 -8% 4 932 5 084 -3%
Order book at the end of the period 4 882 4 530 8%
Net sales 1 590 1 549 3% 5 029 4 779 5%
Operating result (EBITA)1 224 202 11% 643 594 8%
% of net sales 14.1 13.1 12.8 12.4
Operating result (EBIT)2 215 196 10% 612 569 8%
% of net sales 13.5 12.7 12.2 11.9
Profit before taxes 199 157 553 494
Earnings/share, EUR 0.79 0.60 2.25 1.76
Cash flow from operating activities 176 212 255 452
Net interest-bearing debt at the end of the period 372 94
Gross capital expenditure 346 94
Gearing 0.17 0.05
1 EBITA is shown excluding non-recurring items and purchase price allocation amortisation. Wärtsilä recognised non-recurring items amounting to EUR 13 million (30) in the fourth quarter, of which EUR 11 million related to the restructuring programme announced in July and EUR 3 million to acquisitions and other costs. Purchase price allocation amortisation amounted to EUR 9 million (6). During the review period January-December 2015, non-recurring items amounted to EUR 25 million (47), of which EUR 19 million related to the restructuring programme and EUR 6 million to acquisitions and other costs. Purchase price allocation amortisation amounted to EUR 32 million (26).
2 EBIT is shown excluding non-recurring items.
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