Net sales and profitability

Sales decreased

Wärtsilä’s net sales for January-December 2011 decreased by 7.6% to EUR 4,209 million (4,553). This was slightly more than the estimated decrease of 0-5%. The main reason was delayed power plant project deliveries. Power Plants accounted for 32%, Ship Power for 24% and Services for 43% of the total net sales. Net sales for Power Plants totalled EUR 1,365 million (1,525), a decrease of 10%. Ship Power’s net sales decreased by 15% and totalled EUR 1,022 million (1,201). Net sales from the Services business amounted to EUR 1,816 million (1,823). Net sales development was good especially in the strategic focus areas of environmental services, electric & automation and propulsion services. However, over 75% of revenues are still derived from engine related services. The merchant market in particular was rather weak. Net sales increased also in Contracts and Projects. Revenues from projects can vary significantly from quarter to quarter.

Of Wärtsilä’s net sales for January-December 2011, approximately 68% was EUR denominated, 13% USD denominated, with the remainder being split between several currencies.

Operating result and profitability

For the financial period January-December 2011, the operating result before non-recurring items was EUR 469 million (487). Profitability (EBIT%) was 11.1% of net sales (10.7), well in line with Wärtsilä’s estimate for 2011. Including non-recurring items, the operating result was EUR 445 million or 10.6% of net sales. Wärtsilä recognised EUR 24 million of non-recurring items related to the restructuring measures during the financial period January-December 2011.

Financial items amounted to EUR -16 million (-13). Net interest totalled EUR -5 million (-12). Dividends received totalled EUR 3 million (7). Profit before taxes amounted to EUR 429 million (548). Taxes in the reporting period amounted to EUR 136 million (151). The profit for the financial period amounted to EUR 293 million (397). Earnings per share were 1.44 euro (1.96) and equity per share was 8.30 euro (8.30). Return on investment (ROI) was 20.4% (26.0). Return on equity (ROE) was 17.5% (25.0).

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