| In the first quarter of 2008, most of Sulzer’s markets remained robust at high levels. The oil and gas (upstream) as well as the power generation segments developed well, while the hydrocarbon processing industry (oil and gas downstream) and the aviation segment remained stable at a high level. The pulp and paper segment has been softening, while the specific Sulzer relevant applications within the automotive segment grew well.
The growth came mainly from emerging regions, particularly Asia, Middle East, and South America. The order intake from Europe and North America was good, despite signals of softening in some markets. All major currencies have weakened against the Swiss franc, especially the US dollar, the British pound, and the euro.As a consequence, the consolidated nominal growth rates are negatively affected. The adjusted1 figures mainly reflect the development in local currencies, as acquisitions had a very limited impact.
Order intake by division
Sulzer Pumps posted a very strong quarter and increased the order intake to CHF 621.9 million. This was an adjusted1 rise of 27.2%, while the nominal growth was 18.5%. The demand for the division’s solutions was driven by some larger projects. The oil and gas and the power generation segments were of particular note, while activities in the pulp and paper market softened. Markets were active mostly in emerging regions. Order intake for the upcoming months is expected to stay at a high level with continued momentum from the oil and gas and power generation segments.
Sulzer Metco recorded an order intake of CHF 189.5 million. On an adjusted1 basis this was similar (–0.7%) to the previous year’s first quarter, but decreased nominally (–4.0%) due to currency effects. The aviation, power generation, automotive, and general industry segments were healthy. Compared with the same period in the previous year activity was higher for the consumables and the service businesses, while it was lower for the equipment business. The markets in Europe were stronger than in other regions. For the coming months, Sulzer Metco expects moderate growth, and the prospects for power generation, aviation, and automotive markets to remain intact.
Sulzer Chemtech reported an order intake for the first quarter of CHF 234.2 million, based on the oil and gas and hydrocarbon processing market segments stabilizing at a high level. The decrease of –11.8% (adjusted1) respectively –16.2% (nominal) compared to the previous year’s first quarter is mainly caused by the strong first quarter in 2007 when the division significantly benefited from a large order for the Pearl gas-to-liquid (GTL) plant project in Qatar. Excluding this project, Sulzer Chemtech’s order intake was above the first quarter of the previous year. The activity level was particularly strong in China, India, and the Middle East. Sulzer Mixpac Systems continued to perform well despite the slower activities of the US construction market. The outlook for the order intake in the coming months remains stable.
Sulzer Turbo Services posted an order intake of CHF 83.1 million, an increase of 11.9% (adjusted1) respectively 2.0% (nominal). The division benefited from good conditions in all market segments and regions.
Particularly positive was North America. The new facility in Canada has contributed with its first orders. Sulzer Turbo Services expects the order intake to remain stable with continued positive signs in the power generation segment.
Outlook
Even with the strong base effect of 2007, Sulzer anticipates good opportunities for further growth. Most of the key markets are expected to remain in good condition driven by the developments in emerging markets. The upstream oil and gas and the power segments are expected to continue to expand while hydrocarbon processing and aviation segments are likely to stabilize at high levels. The pulp and paper segment is expected to have moderate growth. The influence of the currency effects on translated figures will remain significant.
Order Intake for the First Quarter 2008 (January to March)
(millions of CHF)
|
|
1Q 2008 |
1Q 2007 |
Δ |
Δ adjusted1 |
|
Divisions |
1 128.7
|
1 083.4
|
4.2% |
10.9% |
|
Sulzer Pumps |
621.9 |
524.9 |
18.5% |
27.2% |
|
Sulzer Metco |
189.5 |
197.4 |
–4.0% |
–0.7% |
|
Sulzer Chemtech |
234.2 |
279.6 |
–16.2% |
–11.8% |
|
Sulzer Turbo Services |
83.1 |
81.5 |
2.0% |
11.9% |
|
Other |
5.9 |
2.7 |
– |
– |
|
Total |
1 134.6 |
1 086.1 |
4.5% |
11.1% |
|