Order Intake of CHF 817 Million

21.04.2010

The order intake in the first quarter of 2010 reached CHF 816.8 million. This figure represents a decrease of 1.8% adjusted (nominal 2.7%) compared with the first quarter of the previous year. Order intake was, however, higher than in the remaining three quarters of 2009, supported by some bigger projects awarded to Sulzer Pumps and Sulzer Chemtech.

Sulzer does not anticipate a quick recovery in its key markets. For the full year 2010, order intake is expected to be at a level comparable with that of 2009.

The market conditions remained challenging in the first quarter of 2010, but Sulzer Pumps and Sulzer Chemtech were awarded some larger projects that have been in the pipeline for an extended period. Supported by those orders and the ongoing market stabilization in some relevant key markets, the order intake of the first quarter was higher than in any of the previous three quarters. Sulzer succeeded in maintaining its strong market positions with its performance-critical solutions.

Demand from the oil and gas market was stable, while the hydrocarbon processing industry showed some increased project activity. The power generation market softened, while the demand in the aviation industry was comparatively stable. The automotive industry was more lively, and demand in the pulp and paper industry stabilized.

Activity remained at low levels, particularly in advanced economies while some emerging countries showed growing demand.

Outlook for 2010: Challenging market conditions continue

Order intake in 2010 is expected to be at a level comparable with that of 2009. Sulzer anticipates reduced project activity in the power generation market, while the development in the hydrocarbon processing industry will depend on the revival of large projects. For the oil and gas market, demand is predicted to be at levels comparable with those of 2009, and the activity in the aviation industry is also expected to remain around the current level. The development of the automotive market shows some positive signs. The pulp and paper industry is predicted to remain at a low level. Market activity in Europe and North America is expected to stay low, whereas some of the emerging markets are likely to strengthen comparatively.

Order intake by division

The order intake of Sulzer Pumps reached CHF 427.0 million. This figure represents a decrease of 12.9% on an adjusted1 basis and 12.8% on a nominal basis compared with the strong first quarter of 2009. Sulzer Pumps is the division with the most late cyclical markets within Sulzer, which is reflected in the new equipment order intake development. The oil and gas market remained weak, and the demand from the hydrocarbon processing industry was stable. The power generation market softened, as expected, compared with the level of 2009, although the nuclear power industry is experiencing increased activity in selected countries. Demand in the pulp and paper industry stabilized with signs of renewed activity in some countries. Some emerging countries showed growing demand, while activity levels remained low in most other regions. For 2010, the division anticipates lower order intake than in the previous year.

Orders received by Sulzer Metco totaled CHF 150.4 million, representing an adjusted1 increase of 6.7% and a nominal increase of 3.7%. Overall, the division experienced some stabilization in its markets. Innovations, such as carbon-based coating solutions, allowed Sulzer Metco to seize additional business opportunities in the automotive industry. Other industrial markets also showed slightly higher activity. Demand in the aviation and the power generation industries were comparatively stable. Activity in Asia was on a good level, while markets in the Americas and Europe stabilized. Overall, Sulzer Metco expects the order intake to stabilize in 2010.

Sulzer Chemtech posted an adjusted1 increase in order intake of 27.2% (nominal 27.0%) to CHF 163.9 million compared with the level of the first quarter of 2009. The activity in the hydrocarbon processing industry was supported by some larger projects that have been in the pipeline for an extended period of time. The volume of orders for Tower Field Services was healthy, while the markets for Sulzer Mixpac Systems became considerably more active. The divisional order intake is expected to be stronger in 2010 than it was in 2009.

Sulzer Turbo Services achieved an order intake of CHF 72.7 million, which was comparable with that of the first quarter of the previous year with an increase of 4.9% on an adjusted1 basis (–0.8% on a nominal basis). The market development in the oil and gas and the hydrocarbon processing industries remained challenging as customers postponed maintenance orders. However, the demand for services in the power generation market remained lively, supported by long-term service agreements. For the Asia-Pacific region, market activity stayed at relatively high levels. In 2010, Sulzer Turbo Services expects a stable level of order intake.

1 Adjusted for currency effects, acquisitions, and divestitures

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