Sulzer: Strong Start in 2011
Sulzer made a strong start in the first quarter of 2011 with an increase in order intake of 15.5% adjusted* and 12.4% nominally compared with the respective period of the previous year. All divisions contributed to this increase.
Growth was driven by continued recovery in the early-cycle markets and by some large project orders. For the full year 2011, order intake is expected to show adjusted* growth of close to 10%.
Sulzer started well in 2011 with an increase in order intake of 15.5% adjusted* and 12.4% nominally to CHF 917.8 million. This increase reflects a further sequential improvement over previous quarters. Acquisitions supported growth, while the strong Swiss franc continued to have a significant negative translation impact. All four divisions increased their order intake figures. The early-cycle markets continued their recovery and some large projects returned in the late-cycle markets. The automotive, aviation, and other industrial markets remained strong and showed further growth over the prior year. In the late-cycle markets, activity in the oil and gas segment showed initial recovery; however, the hydrocarbon processing industry remained at a low level. As expected, power generation continued its downward trend in the first three months of the year. The emerging markets remained the growth driver for the company. North America also showed growth, and the order intake in Europe was stable.
Outlook for full-year 2011: Adjusted* order intake growth close to 10%
The positive trend in the early-cycle markets is expected to continue, albeit at a somewhat slower pace. Activity in the automotive industry is likely to continue at its current high level. Further growth in the aviation and other general industrial markets is anticipated. The oil and gas industry is expected to continue to grow, especially in the second half of the year, as the number of project studies has increased. The hydrocarbon processing industry will probably remain flat for most of 2011. Sulzer predicts that, after a sharp decline in 2010, activity in the power generation industry will stabilize. Overall, order intake is expected to show adjusted* growth of close to 10% compared with the full year 2010.
Geographically, the emerging markets are expected to remain growth drivers. The negative translation effects stemming from the strong Swiss franc are likely to persist. However, with its global manufacturing and service network, Sulzer is naturally hedged against major currency impacts on profitability.
* Adjusted for currency effects as well as acquisitions and divestitures
