Order Intake of CHF 2.4 Billion for the First Nine Months

This figure represents an increase of 7.4% (adjusted* 6.1%) compared with the same period in the previous year.

Sulzer maintained its strong market positions in the first nine months of 2010. The company achieved an order intake that was 7.4% above the level of the comparable period of the previous year. The recently acquired businesses had a positive impact, while currency translation effects had a negative effect. Sulzer’s early-cycle markets developed positively, with signs of initial recovery in the pulp and paper, automotive, and other industrial markets. The aviation industry remained stable. In the oil and gas and hydrocarbon processing industries, there were signs of stabilization, although many customers remained cautious with regard to large-scale investments. As expected, the power generation industry declined clearly from the high levels of preceding years. Geographically, Europe and the Americas stabilized, while the emerging markets showed growing demand.

Outlook for 2010

Sulzer expects the positive trend in its early-cycle markets to continue, albeit at a slower pace. The automotive market is likely to level off at the current high activity level, while pulp and paper is predicted to show more project activity. The aviation industry is expected to remain stable. Oil and gas has started to show more activity again, while the hydrocarbon processing industry is stabilizing at a low level. For both markets, a fast recovery is not likely as many customers further delay projects due to concerns about global economic recovery. In the power generation market, activity is forecast to remain low, with the potential for further downward adjustments. Demand in some emerging markets is projected to develop at a faster pace compared with the established markets. For the full year, order intake is expected to be at a level slightly above that of 2009.

Order intake by division

Orders received by Sulzer Pumps totaled CHF 1 225.5 million (–4.6%; adjusted* –3.2%). Market activity in the oil and gas industry showed some recovery from the low levels of 2009, but excess capacity limits significant growth. Activity in the hydrocarbon processing industry increased in some of the emerging markets, but was unchanged in the established markets. The power generation industry continued to soften, except for project activity in the nuclear power segment. The pulp and paper industry showed an increase in activity. Sulzer Pumps expects the oil and gas, hydrocarbon processing, and power generation industries to remain subdued. Activity in the emerging markets is likely to remain higher than in the established markets. For the full year, the division expects an order intake below the level of the previous year.

The order intake of Sulzer Metco reached CHF 473.1 million. This figure represents an increase of 17.3% (adjusted* 21.7%) compared with the first nine months of 2009. The integration of Bekaert’s diamond-like carbon coatings activities is progressing well. Market activity in the automotive industry as well as other industrial markets increased. The aviation market remained stable, while the power generation industry softened. Demand was particularly high in Asia and the Americas, while market activity in Europe stabilized at lower levels. The automotive industry and other industrial markets are expected to maintain the activity levels seen in the first nine months of the year. Stable activity levels are forecast in the aviation industry, while the power generation market is predicted to remain soft. Market activity in Asia and in the Americas is expected to develop at higher levels than in the previous year, whereas the European market is likely to remain challenging. For the full year, the division anticipates a higher order intake than in 2009.

Compared with the first nine months of the previous year, Sulzer Chemtech posted an increase in order intake of 21.8%, or 21.0% on an adjusted* basis resulting in an order intake of CHF 455.2 million. Activity in the hydrocarbon processing industry was higher, but many customers were still reluctant to release major investments. Order volume for the Tower Field Service business unit was encouraging. While tendering activity in Process Technology increased, the performance of this business remains dependent on the progress of various large projects. The markets of Sulzer Mixpac Systems showed strong improvement compared with the previous year. All regions are likely to maintain a higher activity level—except Europe, which is predicted to remain challenging. For the full year, the division expects order intake to be above that of 2009.

Sulzer Turbo Services increased its order intake by 36.3% (adjusted* 6.9%), driven by the acquisition of Dowding & Mills. Orders received totaled CHF 286.1 million. Demand for the division’s services in the power generation industry was sound, while business generated in the hydrocarbon processing industry was comparatively low. Market activity in the Americas, Asia-Pacific, and Europe developed favorably, whereas the Middle East continued to be challenging. The demand for maintenance and support services in the oil and gas and the hydrocarbon processing industries has potential to improve. Compared with the previous years, the division anticipates a higher level of order intake for the full year, which will be supported by the recent acquisition of Dowding & Mills.

*Adjusted for currency effects as well as acquisitions and divestitures