Valmet Oyj: Valmet's Interim Review January 1 - September 30, 2021: Orders received increased to EUR 1.1 billion and Comparable EBITA to EUR 107 million in the third quarter

Figures in brackets, unless otherwise stated, refer to the comparison period, i.e. the same period of the previous year.

HELSINKI, Oct. 26, 2021 /PRNewswire/ --

July-September 2021: Comparable EBITA margin improved to 11.4 percent

• Orders received increased 58 percent to EUR 1,107 million (EUR 700 million).
  - Orders received increased in all business lines.
  - Orders received increased in Asia-Pacific, North America and EMEA (Europe, Middle East and Africa), remained at the previous year's level in South America, and decreased in China.
• Net sales increased 12 percent to EUR 935 million (EUR 832 million).
  - Net sales increased in the Pulp and Energy, Paper and Services business lines, and remained at the previous year's level in the Automation business line.
• Comparable earnings before interest, taxes and amortization (Comparable EBITA) were EUR 107 million (EUR 91 million), and the corresponding Comparable EBITA margin was 11.4 percent (10.9%).
  - Comparable EBITA increased due to higher gross profit.
• Earnings per share were EUR 0.50(EUR 0.38).
• Items affecting comparability amounted to EUR 0 million (EUR -3 million).
• Cash flow provided by operating activities was EUR 57 million (EUR 94 million).

January-September 2021: Orders received and Comparable EBITA increased

• Orders received increased 34 percent to EUR 3,647 million (EUR 2,712 million).
  - Orders received increased in all business lines.
  - Orders received increased in all areas.
• Net sales increased 6 percent to EUR 2,736 million (EUR 2,573 million).
  - Net sales increased in the Paper business line, remained at the previous year's level in the Services, and Pulp and Energy business lines, and decreased in the Automation business line.
• Comparable earnings before interest, taxes and amortization (Comparable EBITA) were EUR 282 million (EUR 218 million), and the corresponding Comparable EBITA margin was 10.3 percent (8.5%).
  - Comparable EBITA increased due to higher gross profit.
• Earnings per share were EUR 1.31(EUR 0.88).
• Items affecting comparability amounted to EUR 10 million (EUR -11 million).
• Cash flow provided by operating activities was EUR 385 million (EUR 418 million).

Guidance for 2021 unchanged

Valmet reiterates its guidance issued on April 16, 2021, in which Valmet estimates that net sales in 2021 will increase in comparison with 2020 (EUR 3,740 million) and Comparable EBITA in 2021 will increase in comparison with 2020 (EUR 365 million).

Short-term market outlook

Valmet estimates that the short-term market outlook for services has improved to good (previously good/satisfactory) and the short-term market outlook for tissue has decreased to satisfactory (previously good). Valmet reiterates the good short-term market outlook for automation, pulp, and board and paper and the weak short-term market outlook for energy.

President and CEO Pasi Laine: Order backlog amounted to EUR 4.2 billion

"Valmet's orders received increased to EUR 1.1 billion in the third quarter of 2021. Orders received increased in all business lines. In the stable business (Services and Automation business lines), orders received increased to EUR 451 million¹. In the capital business (Paper, and Pulp and Energy business lines), orders received increased to EUR 681 million.

Our order backlog reached a record high of EUR 4.2 billion, which is EUR 942 million higher than at the end of 2020.

Net sales increased both in the stable and capital business and amounted to EUR 935 million. The Comparable EBITA increased as well, and the Comparable EBITA margin was 11.4 percent.

On September 22, Valmet's and Neles' Extraordinary General Meetings resolved to approve the merger of Valmet and Neles. The planned closing date of the merger is January 1, 2022. The execution of the merger is still subject to obtaining the necessary merger control approvals by the relevant competition authorities, and therefore the planned closing date may still change."

¹ Including Automation package sales to capital projects

Merger with Neles

On July 2, 2021, Valmet announced that the Boards of Directors of Valmet Oyj and Neles Corporation have signed a combination agreement and a merger plan to combine the two companies through a merger. Both companies held an Extraordinary General Meeting on September 22, 2021, and both EGMs approved the merger. The planned closing date of the merger is January 1, 2022. The planned closing date may be delayed due to the regulatory processes ongoing. Should the closing be delayed from January 1, 2022, Valmet will issue a stock exchange release on the matter and the prospectus will be supplemented once there is more clarity on the timetable of the regulatory processes. Until the completion of the merger Valmet and Neles will carry out their respective businesses as separate and independent companies.

Key figures¹

EUR million	Q3/2021		Q3/2020		Change		Q1-Q3/ 2021		Q1-Q3/ 2020		Change
Orders received	1,107		700		58	%	3,647		2,712		34	%
Order backlog2	4,199		3,311		27	%	4,199		3,311		27	%
Net sales	935		832		12	%	2,736		2,573		6	%
Comparable earnings before interest, taxes and amortization (Comparable EBITA)	107		91		18	%	282		218		29	%
% of net sales	11.4	%	10.9	%			10.3	%	8.5	%
Earnings before interest, taxes and amortization (EBITA)	107		87		22	%	293		208		41	%
% of net sales	11.4	%	10.5	%			10.7	%	8.1	%
Operating profit (EBIT)	95		79		19	%	255		184		39	%
% of net sales	10.1	%	9.5	%			9.3	%	7.1	%
Profit before taxes	95		75		27	%	253		174		45	%
Profit for the period	75		57		32	%	197		131		50	%
Earnings per share, EUR	0.50		0.38		32	%	1.31		0.88		50	%
Earnings per share, diluted, EUR	0.50		0.38		32	%	1.31		0.88		50	%
Equity per share, EUR2	8.10		6.81		19	%	8.10		6.81		19	%
Cash flow provided by operating activities	57		94		-39	%	385		418		-8	%
Cash flow after investments	19		-380				312		-100
Return on equity (ROE) (annualized)							22	%	17	%
Return on capital employed (ROCE) before taxes (annualized)							21	%	17	%
Equity to assets ratio2							41	%	38	%
Gearing2							-1	%	18	%

1The calculation of key figures is presented on page 50.
2At end of period.

Orders received, EUR million	Q3/2021		Q3/2020		Change		Q1-Q3/ 2021		Q1-Q3/ 2020		Change
Services	343		288		19	%	1,099		1,014		8	%
Automation	83		65		29	%	277		238		17	%
Pulp and Energy	150		52		>100%		937		643		46	%
Paper	531		295		80	%	1,334		818		63	%
Total	1,107		700		58	%	3,647		2,712		34	%

Order backlog, EUR million	As at Sep 30, 2021		As at Sep 30, 2020		Change		As at Jun 30, 2021
Total	4,199		3,311		27	%	4,019

Net sales, EUR million	Q3/2021		Q3/2020		Change		Q1-Q3/ 2021		Q1-Q3/ 2020		Change
Services	324		307		5	%	951		924		3	%
Automation	76		72		5	%	206		218		-5	%
Pulp and Energy	260		211		23	%	729		717		2	%
Paper	276		242		14	%	849		713		19	%
Total	935		832		12	%	2,736		2,573		6	%

News conference and webcast for analysts, investors and media

Valmet will arrange a news conference in English as a live webcast at https://valmet.videosync.fi/2021-q3 on Tuesday, October 26, 2021, at 2:00 p.m. Finnish time (EEST). President and CEO Pasi Laine and CFO Kari Saarinen will be presenting the results. Recording of the webcast will be available shortly after the event at the same address.

It is possible to take part in the news conference through a conference call. Conference call participants are requested to dial in at least five minutes prior to the start of the conference at

Finland [phone]
United Kingdom [phone]
France [phone]
Germany [phone]
Norway [phone]
Sweden [phone]
United States [phone]

The participants will be asked to provide the conference PIN: 94442099#.

All questions should be presented in English.

The event can also be followed on Twitter at http://www.twitter.com/valmetir.

Important notice

The merger of Valmet and Neles Corporation ("Neles") and the merger consideration securities have not been and will not be registered under the U.S. Securities Act of 1933 (the "U.S. Securities Act"), and may not be offered, sold or delivered within or into the United States, except pursuant to an applicable exemption of, or in a transaction not subject to, the U.S. Securities Act.

The information in this report is not directed to, or intended for distribution to or use by, any person or entity that is a citizen or resident of, or located in, any locality, state, country or other jurisdiction where such distribution or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction and it does not constitute an offer of or an invitation by or on behalf of, Valmet, or any other person, to purchase any securities.

Further information, please contact:

Pekka Rouhiainen, Director, Investor Relations, Valmet, tel. [phone]
Kari Saarinen, CFO, Valmet, tel. [phone]

VALMET
Kari Saarinen
CFO

Pekka Rouhiainen
Director, Investor Relations

Valmet is the leading global developer and supplier of process technologies, automation and services for the pulp, paper and energy industries. We aim to become the global champion in serving our customers.

Valmet's strong technology offering includes pulp mills, tissue, board and paper production lines, as well as power plants for bioenergy production. Our advanced services and automation solutions improve the reliability and performance of our customers' processes and enhance the effective utilization of raw materials and energy.

Valmet's net sales in 2020 were approximately EUR 3.7 billion. Our 14,000 professionals around the world work close to our customers and are committed to moving our customers' performance forward - every day. Valmet's head office is in Espoo, Finland and its shares are listed on the Nasdaq Helsinki.

Read more www.valmet.com, www.twitter.com/valmetglobal

Follow Valmet IR on Twitter www.twitter.com/valmetir

Processing of personal data

This information was brought to you by Cision http://news.cision.com

https://news.cision.com/valmet-oyj/r/valmet-s-interim-review-january-1---september-30--2021--orders-received-increased-to-eur-1-1-billion,c3440372

The following files are available for download:

https://mb.cision.com/Main/19721/3440372/1486367.pdf

Interim Review Q3 2021 English