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FLSmidth announces 2Q19 results

Published by , Editorial Assistant
World Cement,

FLSmidth’s order intake for 2Q19 amounted to DKK5 billion, down 2% compared to 2Q18, and included a large cement order in Morocco and a large mining order in Australia. The order backlog stood at DKK16.8 billion by the end of the quarter, up 16% from the same period last year.

Following strong order intake and a buildup of order backlog in recent quarters, revenue increased 16% in 2Q19 to DKK5.5 billion, due to a high activity level.

As part of the company’s digital journey, the acquisition of IMP Automation Group was completed in June, strengthening the company’s portfolio of automated laboratory solutions for the mining industry.

EBITA came in at DKK487 million in 2Q19, up 28%. The EBITDA margin increased to 8.9%, from 8.1% in 2Q18. The Group generated cash flow from operations of DKK143 million in 2Q19, despite increased working capital associated with the higher activity level. The return on capital employed advanced to 11.1% from 10.4% at the same time last year.

Management’s guidance for the full year is maintained. Due to great progress on capital business vs a good development in services, the expected business mix for the year has changed. It is now more likely that the revenue will be in the higher end of the guided range of DKK19 – 21 billion, and EBITDA margin will be in the lower end of the guided range 9 – 10%. The company has noted that this has no implications for the expected return on capital employed.

“The second quarter showed a strong performance with improved revenue and profitability, driven by both mining and cement,” said Thomas Schulz, FLSmidth Group CEO. “Following a slow start to the year, we have been successful at converting backlog to revenue in 2Q19. In close cooperation with our customers, we have continued to deliver on our vision to provide sustainable productivity enhancement.

“Our success with both service and capital orders demonstrates our customers’ confidence in our ability to enhance their productivity. This is supported by an increased push for sustainable solutions that ties in well with our position, capabilities, and track record. In cement, we see higher demand for sustainable solutions, for example alternative fuel systems to replace fossil fuels and minimise CO2 emissions. In mining, we see increased interest for new technologies, such as dry stack tailings, but also a general need to reduce water consumption in the production process.”

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European cement news FLSmidth news Cement news 2018