Wärtsilä Shows Strong Second Quarter Amid Continuing Market Challenges
During the second quarter, Wärtsilä’s net sales increased by 22% to US$1,899 million compared to the corresponding period last year. Net sales for Ship Power totalled US$682 million, a growth of 31% compared to the corresponding period last year. Power Plants’ net sales for the second quarter totalled US$539 million, which is 39% higher than in the corresponding quarter last year. The second quarter net sales for Services amounted to US$668 million, a growth of 3%.
The market activity in new building remained very low and only a handful of ship orders were placed during the second quarter. The recent decrease in new building prices did not attract owners to place new orders as the economical fundamentals and an oversupply in bigger ship segments still prevail. The orders that materialized during the second quarter were mainly placed for specialized tonnage at specialized yards.
The market environment for Power Plants was mostly unchanged from the previous quarter. Inquiries for new power plants remained at a high level and market activity was good with customers showing continued interest in new flexible capacity. The impact of the financial crisis was evident through a slower conclusion of projects, mainly due to difficulties in securing financing. In North America an increased amount of inquiries were seen.
Despite the risk of cancellations and the nonrecurring restructuring items booked in the second quarter, the substantial order book at the end of the year should support a 10-20% growth in net sales for 2009, which would maintain the profitability at last year’s good level.
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