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Andritz
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Graz, Austria, 07 May 2007 -- Based on strong organic growth and complementary acquisitions, the Andritz Group showed a very favorable development during the first quarter of 2007. Sales amounted to EUR 730.9 M, an increase of 61.9% compared to the reference quarter of last year (Q1 2006: EUR 451.5 M).

Net income, excluding minority interests, amounted to EUR 28.5 M, exceeding last year's reference quarter by 50.8% (Q1 2006: EUR 18.9 M). Order intake, at EUR 1031.0 M, reached the highest value ever achieved in a quarter. Order backlog, at EUR 3664.5 M as of 31 March 2007 (31 March 2006: EUR 2007.1 M), provides a solid basis for the business development in 2007.

Increase in Sales

In the first quarter of 2007, sales of the Andritz Group amounted to EUR 730.9 M, an increase of 61.9% compared to the reference quarter of last year (Q1 2006: EUR 451.5 M). This increase was due to both continued solid organic growth and the first-time consolidation of VA TECH HYDRO, which added EUR 140.2 M to the Group's sales during the first quarter of 2007.

In total, first-time consolidated companies added approximately EUR 159.8 M to Group sales in the first quarter of 2007. Organic growth of the Andritz Group, therefore, amounted to 26.5%.

Order Intake significantly up

Order intake of the Group during the first quarter of 2007 amounted to EUR 1031.0 M, increasing 37.9% compared to the first quarter of 2006 (Q1 2006: EUR 747.6 M). This increase was mainly due to the first-time consolidation of VA TECH HYDRO, adding EUR 278.0 M to the Group's order intake in the first quarter of 2007. The combined order intake of first-time consolidated companies amounted to approximately EUR 293.6 M.

In particular, the Rolling Mills and Strip Processing Lines, and the Feed and Biofuel Business Areas were able to increase their order intakes considerably compared to the reference period of last year. Order intake of the Pulp and Paper Business Area was somewhat lower compared to the very high level of last year's reference period.

Order backlog as of 31 March 2007 amounted to EUR 3664.5 M, an increase of 82.6% compared to the value at the reference date of last year (31 March 2006: EUR 2007.1 M). VA TECH HYDRO added EUR 1682.9 M to the Group's order backlog as of 31 MArch 2007.

Increase in Earnings

The Group's EBITA (earnings before interest, taxes, and amortization of intangibles related to acquisitions) amounted to EUR 39.8 M. This is an increase of 49.6% compared to the first quarter of 2006 (EUR 26.6 M. However, the EBITA margin, at 5.4%, was lower compared to the reference period of last year (Q1 2006: 5.9%). This was mainly due to the decline of profitability in the Pulp and Paper Business Area resulting from the processing of some larger orders with lower margins, increasing costs for steel, erection services and other outsourced supplies, as well as costs incurred in connection for the expansion of the product range. However, earnings and margins of the Rolling Mills and Strip Processing Lines, the Environment and Process, and the Feed and Biofuel Business Areas increased compared to the reference period of last year.

Net Income excluding minority interests amounted to EUR 28.5 M, exceeding last year's reference quarter by 50.8% (Q1 2006: EUR 18.9 M).

Solid balance sheet structure

As of 31 March 2007, the Andritz Group's balance sheet showed an unchanged solid financial structure. Net liquidity (cash and cash equivalents minus interest-bearing financial liabilities) as of 31 March 2007 amounted to EUR 401.5 M, thus increasing compared to the value as of the end of last year (31 December 2006: EUR 365.7 M). The equity ratio as of 31 March 2007 was 16.8% (31 December 2006: 17.5%).

Outlook

On the basis of forecasts of leading economic researchers who expect the global economy to continue to grow this year, Andritz expects its relevant markets to continue to develop favorably in 2007.

Wolfgang Leitner, president and CEO of Andritz, said: "In all of our five business areas, we see a continued high project activity. Based on the favorable economic conditions in all of our relevant markets and the high order backlog as of the end of the first quarter of 2007, we expect Group sales for the full year of 2007 to amount to approximately EUR 3.1 billion (sales 2006: EUR 2709.7 M), thus reaching another record year. Net income after taxes is expected to increase in line with sales (net income after taxes 2006: EUR 121.4 M)."

The Letter to Shareholders for the first quarter of 2007 is available on the Andritz Web site (www.andritz.com). Printed versions can be requested by telephone (+43 316 6902 2722), fax (+43 316 6902 465) or email (petra.wolf@andritz.com).

About the Andritz Group

Publicly listed Andritz Group is a global market leader for advanced production systems for pulp and paper, steel, and other specialized industries. Andritz has a staff of approximately 10,400 employees worldwide. It develops and makes its high-tech systems at 35 production sites (Austria, Germany, Finland, Denmark, France, Netherlands, the United States, Canada, and China).
 

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