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  4. FLSmidth sees strong improvements in earnings and cash flow from operations

FLSmidth sees strong improvements in earnings and cash flow from operations

 

Published by
 World Cement,

The Board of Directors and the Group Management of FLSmidth & Co. A/S have reviewed and approved the Interim Report for 1 January to 30 September 2014. The company recorded strong improvements in earnings and cash flow from operations, a reduction in net working capital, and low order intake as a result of continued low level of mining investments and increased market uncertainty. Full-year revenue and margin guidance have been maintained.

3Q14 financial highlights

  • Order intake decreased by 3% to DKK4.502 billion (3Q13: DKK4.642 billion).
  • Order backlog decreased by 13% to DKK21.416 billion (3Q13: DKK24.595 billion).
  • Revenue decreased by 18% to DKK5.526 billion (3Q13: DKK6.730 billion).
  • Earnings before amortisation and impairment of intangible assets (EBITA) increased by 104% to DKK499 million (3Q14: DKK245 million), corresponding to an EBITA margin of 9.0% (3Q13: 3.6%).
  • Earnings before interest and tax (EBIT) amounted to DKK410 million (3Q13: DKK-727 million) corresponding to an EBIT margin of 7.4% (3Q13: -10.8%).
  • Profit amounted to DKK215 million (3Q13: DKK-783 million).
  • Cash flow from operating activities increased by 213% to DKK887 million (3Q13: DKK283 million).
  • Net interest-bearing debt amounted to DKK-4.881 billion (end of 2013: DKK-4.718 billion).
  • Net working capital amounted to DKK2.761 billion (end of 2013: DKK2.382 billion).
  • Return on capital employed (ROCE) was unchanged at 10% (3Q13: 10%).

January – September financial highlights

  • Order intake decreased by 9% to DKK13.986 billion (January – September 2013: DKK15.295 billion).
  • Order backlog decreased by 4% to DKK21.416 billion (end of 2013: DKK22.312 billion).
  • Revenue decreased by 16% to DKK16.400 billion (January – September 2013: DKK19.503 billion).
  • Earnings before amortisation and impairment of intangible assets (EBITA) increased by 76% to DKK1.298 billion (January – September 2013: DKK755 million), corresponding to an EBITA margin of 7.9% (January – September 2013: 3.9%).
  • Earnings before interest and tax (EBIT) amounted to DKK1.030 billion (January – September 2013: DKK-399 million) corresponding to an EBIT margin of 6.3% (January – September 2013: -2.0%).
  • Profit amounted to DKK567 million (January – September 2013: DKK-605).
  • Cash flow from operating activities amounted to DKK559 million (January – September 2013: DKK-234 million).

Guidance for 2014

In 2014, FLSmidth & Co. A/S expects to see the following developments:

  • Revenue DKK21 – 24 billion (2014 YTD Actual: DKK16.4 billion).
  • EBITA margin 7 – 9% (2014 YTD Actual: 7.9%).
  • Return on capital employed 11 – 13% (2014 YTD Actual: 10%).
  • Cash flow from investments (excl. acquisitions) ~DKK -0.5 billion (previously ~ DKK-0.4 billion) (2014 YTD Actual: DKK-0.2billion).
  • Effective tax rate 33 – 35% (2014 YTD Actual: 34%).
  • Cost associated with the efficiency programme is expected to amount to approximately DKK-72 million in 2014, which is included in the guidance.

Read FLSmidth’s Interim Report (1 January – 30 September 2014) in full here.


Adapted from press release by Rosalie Starling

 

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