Is the scrubbers growth over?
The return to growth in Marine was much appreciated when the Q3 figures came out. This was, once again, largely driven by the IMO 2020 sulphur regulation. Now, the question is rather to identify where the industry is going and what level of growth in scrubbers is sustainable.
06 Dec 19
Strong set of Q3 results
Alfa Laval reported a strong set of Q3 results, with both sales and adjusted EBITA growing in double-digits. Following a weak momentum in Q2, the Marine division was back in positive territory at record levels. This trend should continue to be supported by the IMI 2020 regulation, and management gave a positive outlook for Q4, with demand expected to be somewhat higher compared to this quarter.
24 Oct 19
Weaker orders on lower scrubbers
Alfa Laval reported a mixed set of results, with declining orders due to both pumping systems and scrubbers, a better than expected development in Energy and Marine, while Food and Water underperformed and affected the whole group’s performance. The Marine division continues to drive growth thanks to good deliveries and execution. Management remains confident and expects demand to be “somewhat higher” in Q3 compared to Q2.
17 Jul 19
Robust Q1, weaker Q2 outlook
Alfa Laval reported a good set of results, once again driven by the Marine division which continues to benefit from strong orders for scrubbers PureSOx and, as expected, demand for PureBallast (ramp-up). The only dampener from this release is the cautious Q2 outlook given by management, expecting to be “somewhat lower” than the first quarter.
25 Apr 19
Lower than expected Q4 results
Order intake and earnings were weaker than expected in Q4. The Energy business reported decreasing margins (-130bp), and FX headwinds have not helped despite strong demand for environmental products. Indeed, in the Marine division (growth driver), we continue to see a positive trend but at a slower pace, while the Energy business dragged down the performance due to overcapacity. Has the peak been reached? What is clear is that growth would continue in the coming quarters, but at a slower pace.
05 Feb 19
Marine and Food & Water drive the performance
Alfa Laval reported strong Q3 results. Orders intake increased by 35% over the quarter and +26% on an organic basis. Net sales increased +24% to SEK10.1bn, while adjusted EBITA was up +33% to SEK1.7bn (including a positive FX impact of SEK50m). The gross margin progressed to 34% (+20bp), while the adjusted EBITA margin progressed from 16% to 17.1%. Free cash flow increased +12.7% to SEK877m.
26 Oct 18
Accelerating growth in the Marine division
Revenues were SEK10.1bn and operating income came in at SEK1.4bn, both are beating consensus expectations. The order intake increased by 12% to SEK9.7bn, mainly driven by the buoyant Marine division and the continuing positive trend in the Food & Water division during the year. Outlook 2018: management expects the demand in Marine & Energy division to decrease sequentially in Q1. Meanwhile, Food & Water should continue its upward momentum and be somewhat higher than in Q4 17.
31 Jan 18
Back to the ground
The Q3 17 revenue was SEK8.2bn (-5% yoy), and the adjusted EBITA was SEK1.3bn, both below the consensus expectations but in line with our estimates. The order intake came in at SEK8.4bn (+12% yoy), mainly driven by the good order intake for environmental applications and improved contracting for the ship made in the Marine division. Free cash flow from operating activities was SEK1.0bn (15% yoy). Management expects that demand in Q4 should be higher than in Q3.
25 Oct 17
Q1 order intake beat expectations
Q1 17 net sales were SEK8.1bn (-1% yoy), somewhat above consensus expectations. The operating income was SEK1,016m (-5% yoy), beating consensus. The net income, at SEK776m (vs. SEK871m in Q1 16), was also a positive surprise. Outlook for Q2 17: demand in line or somewhat lower than in Q1.
26 Apr 17
Some order recovery in Marine, Process Technology
Q4 16 net sales were SEK9.9bn (-8% yoy), above consensus expectations. The operating income was SEK820m (vs. SEK1,483m in Q4 15), missing consensus. Net income at SEK 616m (vs. SEK935m in Q4 15) was also below expectations. On the other hand, the order intake, at SEK8.7bn, beat estimates. Outlook for Q1 17: demand somewhat lower than in Q4.
31 Jan 17
Restructuring one-offs at SEK1.5bn; SEK300m G&A savings
Q3 results: net sales were SEK8.6bn (-11% yoy), in line with consensus expectations. The order intake came in at SEK7.5bn (-13% yoy), below estimates. The adjusted EBITDA, at SEK1,339m (-20% yoy), is also in line. However, the company reported an operating loss (-SEK33m, vs. a SEK1,402m operating income in Q3 15) due to restructuring costs: SEK1.1bn in Q3, o/w SEK600m of write-offs and SEK500m for redundancies (700 employees, c. 4% of headcount); Alfa Laval expects SEK1.5bn in total. The company aims at saving SEK300m on sales and administrative costs. The net loss was at SEK106m (vs. a SEK988m profit in Q3 15). Outlook for Q4 16: demand in line with or somewhat higher than in Q3.
25 Oct 16
Strategic review: first results
The strategic review aims at getting back on to a solid organic growth track and face the hurdles related to the oil & gas and marine sectors. The organisation will be structured around target industries, where divisions bundle product-based business units: - Marine division; - Food & Water division; - Energy division. The divisions will share common Global Sales & Service (regrouping the previously three regional sales functions) as well as Operations. The strategy has three pillars: - Customers: improve interaction. The goal is to improve speed in customer interaction through clarity and accountability. Moreover, the company should become more selective in picking its market and application presence: fewer areas with better growth prospects. - Products: technological strength. Alfa Laval continues to rely on its three core technologies. Development axes include customer energy/environmental performance and digitalisation. The group will invest in a new R&D lab for high-speed separators in Sweden. - Services: expand the offering. New service centres are being open in 2016 (Iran, Angola and California).
30 Aug 16
Starting a strategic review
Q1 16 results: the order intake was at SEK 7.7bn (-19% yoy, ex. currency effects). Net sales fell by 6% yoy (at constant currencies), to SEK 8.2bn. Adjusted EBITA was at SEK 1.3bn (-15% yoy), missing consensus. The operating income came in at SEK 1.1bn (-17% yoy), also below consensus. Net income was at SEK 871m (flat yoy), somewhat above consensus. Cash flow from operations stood at SEK 0.9bn (-17% yoy). Outlook Q2 16: demand at about the same level as in Q1 16.
26 Apr 16
Q4 15 missing expectations and weak demand calls for negative revision
Q4 results: the order intake was at SEK9.4bn (-11% yoy, ex. currency effects). Net sales declined by 2% yoy (at constant currencies), to SEK10.8bn. Adjusted EBITA came in at SEK1.8bn (-10% yoy), below consensus. The operating income came in at SEK1.5bn (-11% yoy). Net income was at SEK935m (+3% yoy), missing the consensus. Cash flow from operations of SEK1.9bn (+11% yoy). Outlook Q4 15: demand somewhat lower than in Q4 15.
02 Feb 16
Q3 marginal miss; stable or somewhat higher demand expected in Q4
Q3 results: the order intake was slightly below consensus (by 3%), at SEK87bn (-15% yoy, ex. currency effects). Net sales were flat yoy (at constant currencies), at SEK9.7bn, largely in line with consensus estimates. Adjusted EBITA came in at SEK1.7bn (+9% yoy), 2% lower than consensus. However, it was a record level for a Q3. The operating income came in at SEK1.4bn (+40% yoy). Net income was SEK988m (+42% yoy). Cash flow from operations was SEK1.4bn (+18% yoy). Outlook Q4 15: demand in line or somewhat higher than in Q3.
27 Oct 15
Pointing to stable demand (vs. guidance of weaker demand in previous quarters)
Q2 results: order intake was SEK9.1bn (-7% yoy at constant currencies). Net sales increased by 11% yoy (at constant currencies), to SEK10.2bn, above consensus estimates of SEK9.9bn. Adjusted EBITA came in at SEK1.8bn (+35% yoy). Operating income came in at SEK1.5bn, above consensus at SEK1.4bn. Net income was SEK1,075m (+35% yoy), vs. consensus at SEK938m. Cash flow from operations was SEK1.5bn (+28% yoy). Outlook: Q3 demand at about the same level as Q2. Management sees a stabilisation of demand in Oil & Gas.
16 Jul 15