The year 2011 in brief

The year 2011 was marked by good growth in order intake and resilience in profitability, despite lower net sales. The order intake increased by 13% compared to the previous year. Order intake for Power Plants grew by 13% and for Ship Power by 52%. The book-to-bill climbed over one for the first time since 2008. Wärtsilä’s net sales totalled EUR 4,209 million, a decrease of 7.6% from the previous year. This was slightly more than the estimated decrease of 0-5%, and it was mainly due to delayed power plant deliveries. The operating profit (EBIT) was 11.1% of net sales (10.7), which was well in line with Wärtsilä’s estimate for 2011. The continued good profitability was a result of a good mix of orders, successful execution, and keeping our costs under control.

2011 was also a year of changes. Wärtsilä’s new President & CEO, Björn Rosengren, assumed his position on 1 September 2011. The economic environment also changed significantly, with the financial problems within the EU and US markets starting to escalate during the summer, eventually affecting GDP development globally. Despite this, the growing emerging markets continued to invest in new power generation capacity. During the year, Wärtsilä received several power plant orders relying on the benefits of Wärtsilä’s Smart Power Generation concept. Ship Power order intake development was strong in offshore and other specialised vessel segments, due to robust contracting activity in the corresponding vessel types. Ordering activity was also high in the LNG carrier markets, resulting in a strong order intake for our Korean joint venture. The uncertainty in the global economy began to have an impact on the marine service market, especially in Europe and in the merchant vessel market. However, this development was offset by higher activity levels in markets such as offshore and power plant services, resulting in Services’ net sales remaining stable during 2011.

Several strategic investments were made during 2011. In June, Wärtsilä and Jiangsu CuiXing Marine Offshore Engineering Co. Ltd. agreed to establish a joint venture in China for the manufacture of Wärtsilä 26 and Wärtsilä 32 medium-speed marine engines. In July, Wärtsilä acquired Cedervall, one of the leading manufacturers of shaft seal and bearing systems for the marine industry, and in November, Wärtsilä inaugurated its new spare parts distribution centre in Kampen, the Netherlands. To strengthen our position in the offshore, marine gas application, and environmental solutions markets, we acquired Hamworthy, a British company that has a strong product offering and position in these markets.

Key figures
                 
MEUR 2011 Q4 / 2011 Q3 / 2011 Q2 / 2011 Q1 / 2011 2010 2009
Net sales 4 209 1 238 851 1 036 1 083 4 553 5 260
  Power Plants 1 365 413 243 360 349 1 525 1 645
  Ship Power 1 022 309 197 223 294 1 201 1 767
  Services 1 816 513 412 452 439 1 823 1 830
Depreciation and amortisations -113 -29 -27 -28 -29 -116 -165
Operating result1 469 145 94 117 113 487 638
Operating result1, % 11.1 11.7 11.0 11.3 10.4 10.7 12.1
Profit before taxes 429 131 83 108 107 548 558
Earnings per share1, EUR 1.52 0.48 0.28 0.39 0.38 1.68 2.15
Balance sheet total 4 600 4 600 4 439 4 396 4 533 4 696 4 655
Interest-bearing liabilities, gross 652 652 604 607 618 628 664
Cash and cash equivalents 592 592 658 541 619 776 244
ROI, % 20.4 - - - - 26.0 29.9
Gearing 0.04 0.04 -0.03 0.04 0.00 -0.09 0.28
Order book, end of period 4 007 4 007 4 042 3 779 3 669 3 795 4 491
Order intake 4 516 1 250 1 118 1 170 979 4 005 3 291
Personnel, end of period 17 913 17 913 17 875 17 654 17 526 17 528 18 541
Year-end market capitalisation 4 402 - - - - 5 631 2 768
                 
1 Figures exclude non-recurring restructuring items and selling profits.
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