Wärtsilä Corporation FINANCIAL STATEMENTS RELEASE 30 January 2009 at
8.30 local time
NET SALES GREW 23%, PROFITABILITY IMPROVED TO 11.4%
FOURTH QUARTER OCTOBER-DECEMBER 2008 HIGHLIGHTS
- Order intake fell 48% to EUR 823 million (1,594)
- Net sales grew 20% to EUR 1,530 million (1,272)
- Operating result (EBIT) grew 34% to EUR 197 million, or 12.9% of
net sales (EUR 147 million and 11.5%)
- Earnings per share amounted to EUR 1.46 (1.05)
HIGHLIGHTS OF THE REVIEW PERIOD JANUARY-DECEMBER 2008
- Order intake EUR 5,573 million (5,633), -1%
- Order book totalled EUR 6,883 million (6,308), growth 9%
- Materialised order cancellations totalled EUR 333 million
- Net sales EUR 4,612 million (3,763), growth 23%
- Operating result EUR 525 million (380), growth 38%
- Profitability 11.4% (10.1)
- Earnings per share amounted to EUR 3.88 (2.74)
- Cash flow from operating activities EUR 278 million (431)
- Board of Director's proposes 1.50 euros per share in dividend
OLE JOHANSSON, PRESIDENT AND CEO:"The year 2008 will go down in history as a year of contrasts for
Wärtsilä. On one hand it was another record year; net sales grew by
more than 23% and the profitability also improved clearly. The order
intake was brisk in the beginning of the year and by the end of June
the order book reached a level of 7.5 billion euros. On the other
hand, the global financial and economic crisis created uncertainty in
Wärtsilä's main markets. As a result order intake, particularly in
our Ship Power sector, slowed down markedly during the second half of
the year and there was an increase in order cancellations. During the
review period cancellations of EUR 333 million materialised and we
see an additional EUR 800 million at risk. The power plants markets
continued to be active throughout the year and orders were signed
even at the very end of the year. While it is difficult to foresee
the extent and duration of the downturn, the effect on our activities
should, at least during the current year, be limited. We look at 2009
with confidence. The substantial order book at the end of the year
should support net sales growing 10-20% in 2009 even with the risk of
cancellations, which would maintain the profitability at last year's
good level."
WÄRTSILÄ'S PROSPECTS FOR 2009
Despite the risk of cancellations, the substantial order book at the
end of the year should support a 10-20 percent growth in net sales
for 2009, which would maintain the profitability at last year's good
level.
ENCLS: Board of Directors' Proposal to the Annual General Meeting
ANALYST AND PRESS CONFERENCE
An analyst and press conference will be held on Friday 30 January
2009, at 10.45 a.m. Finnish time (8.45 a.m. UK time), at the Wärtsilä
headquarters in Helsinki, Finland. The combined web- and
teleconference can be viewed on the internet at the following
address:
http://wip.goodmood.tv:80/wip/directlink.do?newbrowser=1&pid=2668366.
To participate in the teleconference please call: +44 (0) 20 7162
0077 and enter the Conference ID: 823162. If you want to ask
questions during the teleconference, press the number 1 on your phone
to register for a question and the # -key to withdraw a question. The
event title for the call is: Results Q4, please be ready to state
your details and the name of the conference to the operator. If
problems occur, please press the *-button followed by the 0-button.
We would recommend that you would register to the conference in
advance at the following address:
https://eventreg1.conferencing.com/webportal3/reg.html?Acc=085460&Conf=163662.
An on-demand version of the webcast will be available on the company
website later the same day.
Wärtsilä Corporation in brief
Wärtsilä enhances the business of its customers by providing them
with complete lifecycle power solutions. When creating better and
environmentally compatible technologies, Wärtsilä focuses on the
marine and energy markets with products and solutions as well as
services. Through innovative products and services, Wärtsilä sets out
to be the most valued business partner of all its customers. This is
achieved by the dedication of close to 19,000 professionals manning
160 locations in close to 70 countries around the world.
FINANCIAL STATEMENTS BULLETIN JANUARY-DECEMBER 2008
The figures in this financial statements bulletin are audited.
FOURTH QUARTER 10-12/2008 IN BRIEF
MEUR 10-12/2008 10-12/2007 Change
Order intake 823 1 594 -48%
Net sales 1 530 1 272 20%
Operating result 197 147 34%
% of net sales 12.9% 11.5%
Profit before taxes 183 145 26%
Earnings/share, EUR 1.46 1.05
REVIEW PERIOD JANUARY-DECEMBER 2008 IN BRIEF
MEUR 1-12/2008 1-12/2007 Change
Order intake 5 573 5 633 -1%
Order book at the end of the period *) 6 883 6 308 9%
Net sales 4 612 3 763 23%
Operating result 525 380 38%
% of net sales 11.4% 10.1%
Profit before taxes 516 372 39%
Earnings/share, EUR 3.88 1) 2.74
Cash flow from operating activities 278 431
Interest-bearing net debt
at the end of the period 455 -27
Gross capital expenditure 366 231
1) 3.96 euros before the effect of the combination of Wärtsilä's
share series.
*) Cancellations amounting to EUR 333 million and the order book of
Bio Power amounting to EUR 116 million have been eliminated from the
order book. Additions relating to acquisitions and other adjustments
amounted to EUR 158 million.
OPERATING ENVIRONMENT AND MARKETS 2008
SHIP POWER MARKETS UNDER TURMOIL
The year 2008 started with very high activity in all the main marine
vessel segments. Due to the financial crisis uncertainty increased
during the autumn. As a consequence the shipping market came to a
complete standstill in the last quarter of 2008 and only a handful of
new orders were placed. In total, ordering volumes for the year 2008
represented roughly half of the very high volumes of 2007. Despite
the gloomy ending to the year, ordering for the full year was still
at the same level, or even above, that of the years preceding the
booming markets of 2006-2007. Although signs of declining demand have
been seen for quite some time, the markets were taken by surprise by
the speed at which the slowdown has occurred.
Cancellations and rescheduling of existing orders occurred during the
last 6 months of the year. Tightened lending policies together with
the low asset values in combination with heavily decreased freight
rates totally froze shipbuilding financing. In the bigger vessel
segments, such as tankers and bulkers, some 300-400 vessels were
cancelled in 2008. It is quite clear that more cancellations will
occur. The cancellation risk is still biggest for various merchant
vessels and some offshore vessels due to the developments in oil
pricing. Furthermore slippage of shipyard delivery schedules will
most probably occur in the future. Many yards are scaling back from
their original timetables, which in turn inevitably impacts the
schedules of the whole supply chain.
Measured by number of vessels, China still holds the number one
position with a 38% market share while Korean yards have signed 29%
of the new vessels ordered in 2008. Japan's share has grown to 14%,
whereas Europe and other areas total 9% and 10% of the total market.
Measured by tonnage, Korea still represents the biggest share with
44%, China following with 38%, Japan with 12% and Europe with just 2%
of the market.
Ship Power market shares
At the end of 2008, Wärtsilä's market share in medium-speed main
engines had increased to 37% (34 at the end of the third quarter
2008). This was mainly due to improved performance within the
Merchant segment as well as bigger weighting of traditional Wärtsilä
dominated areas such as Cruise&Ferry and Special vessels. The market
share in low-speed engines increased slightly to 15% (13 at the end
of the previous quarter). In auxiliary engines the market share was
8% (9).
POWER PLANT MARKETS ACTIVE
During the first part of the year, activity in the power plant market
was high and demand was strong. When the magnitude of the financial
crisis became clear in the autumn, a slowdown in customer decision
making processes was seen but towards the end of the year ordering
activity again picked up. At the end of the year offering activity
still was at a high level and markets were active. The impact of the
financial crisis is starting to be seen in certain markets where
potential new projects are being delayed, mainly in the industrial
self-generation segment.
Power Plants market shares
According to statistics compiled by the Diesel and Gas Turbine
magazine, the total global market for oil and gas power plants in
Wärtsilä's power range grew to 20,980 MW (14,065) between June 2007
and May 2008. The market for gas power plants, including both
reciprocating engines and gas turbines, grew to 15,630 MW (10,900),
Wärtsilä's share of the market being 8% (12). Wärtsilä's market share
of heavy fuel oil plants increased to 49% (38) following a strong
intake of orders from markets such as Brazil and Pakistan. In light
fuel oil power plants, Wärtsilä's market share was 20% (24).
THE MARKET CONDITIONS FOR SERVICES REMAINED FAVOURABLE
The market conditions in the Services business remained favourable
throughout the year. Wärtsilä's installed engine base of approx.
162,000 MW, for both the Ship Power and Power Plants markets,
consists of thousands of installations distributed all over the
world. Both end markets consist of several customer segments for
Services. Therefore downturns within specific vessel segments or
geographical areas should not significantly affect Services. Also,
Wärtsilä's portfolio is the broadest in the market and offers various
sources of revenues, which also limits exposure to market
fluctuations. Fluctuating energy prices, combined with new and more
stringent environmental legislation are driving machinery development
towards more complex technologies and advanced control systems.
Maintaining, tuning or upgrading this equipment for optimal
efficiency and emission compliance requires highly skilled
specialists that aren't always available to the market. The market
for Wärtsilä's Services remained active throughout the review period.
ORDER INTAKE AT LAST YEAR'S LEVEL, ORDER BOOK GREW 9%
In the fourth quarter Wärtsilä's order intake totalled EUR 823
million (1,594), a decrease of 48%. Order intake for Wärtsilä Ship
Power decreased significantly due to the current very unstable market
conditions and totalled EUR 152 million (640).
The fourth quarter order intake for the Power Plants business
totalled EUR 263 million (463), 43 % lower than the corresponding
period last year. Ordering activity was slower during the first two
months of the quarter, in the immediate wake of the financial crisis,
but accelerated towards the end of the year. Due to its project
nature the Power Plants business is lumpy and order intake, as well
as net sales can vary significantly from one quarter to another.
During the fourth quarter the largest oil-fired power plant orders
were received from Brazil and Mali. The latest order from Brazil
follows the five others from the same country signed earlier in the
year. The largest gas power plants orders were received from Nigeria
and the USA.
During the review period January-December 2008 the order intake
totalled EUR 5,573 million (5,633), a decrease of 1%. The order
intake for Ship Power totalled EUR 1,826 million (2,600), a 30%
decrease. Order intake was brisk in Wärtsilä's Ship Power business
during the first half of 2008. Demand was especially high for bulk
carriers as a result of the bulker boom in 2007 but demand was strong
in other Merchant vessel types as well. Ordering within the Offshore
vessels segment continued to be strong at the beginning of the year.
Along with the global financial and economic crisis uncertainty grew
for Wärtsilä's Ship Power business. As a result, the order intake
slowed down markedly during the second half of the year and
speculations about potential cancellations of vessel orders
increased. Towards the end of the year, activity in the shipbuilding
markets had come to an almost complete halt. For the review period
the Merchant vessel segment represented 47% of Wärtsilä Ship Power's
new orders. Offshore represented 27%, Special vessels 11%,
Cruise&Ferry 10% and Navy represented 5% of the total Ship Power
order intake.
During the review period January-December 2008, growth in Power
Plants orders was very strong at 33% totalling EUR 1,883 million
(1,421). The increase in order intake was mainly related to orders
received from the Americas, the Middle East and some African
countries. Ordering activity was especially strong in Brazil from
where Wärtsilä received six orders for flexible baseload power plants
having a total output of 1,035 MW. The orders were mainly a result of
the energy auctions conducted in Brazil in 2007. During the period
Wärtsilä also continued to strengthen its position on the US grid
stability market. The review period also marked a milestone for
Wärtsilä with the receipt of an order for a combined heat and power
(CHP) plant that will run on liquid biofuel extracted from the seeds
of the jatropha plant. This power plant, which is to o be built in
Belgium, will be the first in the world ever to produce both
electricity and heat using jatropha oil as fuel and is yet another
important step in the development of Wärtsilä's fuel flexibility.
During the review period January-December 2008 the order intake for
Wärtsilä Services totalled EUR 1,858 million (1,607), a growth of
16%. Wärtsilä Services received several substantial project orders
and signed a number of operations and maintenance contracts all over
the world during the period.
The total order book at the end of the review period stood at EUR
6,883 million (6,308), a growth of 9% in relation to the
corresponding date last year. During the period cancellations of EUR
333 million materialised and have been deducted from the order book.
Wärtsilä sees an additional EUR 800 million at risk. In 2008 realised
cancellations were concentrated mainly within the Merchant and
Offshore vessel segments, with some minor impact on Special vessels.
At the establishment of the joint venture combining Metso's
Heat&Power and Wärtsilä's BioPower businesses, Bio Power's order book
amounting to EUR 116 million, has been transferred. Additions
relating to acquisitions and other adjustments amounted to EUR 158
million.
The Ship Power order book totalled EUR 4.486 million (4,292), a
growth of 5%. At the end of the review period, the Power Plants order
book amounted to 1,949 million (1,608), a growth of 21% compared to
the corresponding date last year. Services order book totalled EUR
445 million (405), a growth of 10%.
Fourth quarter order intake by business
MEUR 10-12/2008 10-12/2007 Change
Ship Power 152 640 -76%
Services 410 489 -16%
Power Plants 263 463 -43%
Order intake, total 823 1 594 -48%
Order intake Power Plants
MW 10-12/2008 10-12/2007 Change
Oil 290 419 -31%
Gas 207 244 -15%
Renewable fuels 0 79 -100%
Order intake for the review period by business
MEUR 1-12/2008 1-12/2007 Change
Ship Power 1 826 2 600 -30%
Services 1 858 1 607 16%
Power Plants 1 883 1 421 33%
Order intake, total 5 573 5 633 -1%
Order intake Power Plants
MW 1-12/2008 1-12/2007 Change
Oil 2 029 1 358 49%
Gas 1 240 1 005 23%
Renewable fuels 80 483 -83%
Order book by business
MEUR 31 Dec. 2008 31 Dec. 2007 Change
Ship Power 4 486 4 292 5%
Services 445 405 10%
Power Plants 1 949 1 608 21%
Order book, total*) 6 883 6 308 9%
*) Cancellations amounting to EUR 333 million and the order book of
Bio Power amounting to EUR 116 million have been deducted from the
order book. Additions relating to acquisitions and other adjustments
amounted to EUR 158 million.
NET SALES
During the fourth quarter Wärtsilä's net sales increased by 20% to
EUR 1,530 million (1,272) compared to the corresponding period last
year. Net sales for Ship Power totalled EUR 579 million (449), a
growth of 29%. Power Plants' net sales for the fourth quarter
totalled 464 million (390), which is 19% higher than in the
corresponding quarter last year. The fourth quarter net sales for
Services amounted to EUR 495 million (431), a growth of 15%, of which
14% was organic growth.
Wärtsilä's net sales for January-December 2008 grew strongly by 23%
and totalled EUR 4,612 million (3,763). Ship Power net sales grew by
16% and totalled EUR 1,531 million (1,320). Net sales for Power
Plants developed very strongly during the review period and totalled
1,261 million (882), which represents a growth of 43% compared to the
corresponding period last year. Net sales from the Services business
increased to EUR 1,830 million (1,550), a growth of 18%. Organic
growth represented 17% of Services' net sales growth. For the review
period January-December 2008, Services net sales accounted for
40%,Ship Power net sales for 33% and Power Plants for 27% of the
total net sales.
Fourth quarter net sales by business
MEUR 10-12/2008 10-12/2007 Change
Ship Power 579 449 29%
Services 495 431 15%
Power Plants 464 390 19%
Net sales, total 1 530 1 272 20%
Net sales for the review period by business
MEUR 1-12/2008 1-12/2007 Change
Ship Power 1 531 1 320 16%
Services 1 830 1 550 18%
Power Plants 1 261 882 43%
Net sales, total 4 612 3 763 23%
FINANCIAL RESULTS
The operating result for the fourth quarter amounted to EUR 197
million (147) or 12.9% (11.5) of net sales. The operating result for
the review period January-December 2008 rose to EUR 525 million
(380), which is 11.4% of net sales (10.1). Financial items amounted
to EUR -9 million (-8). Net interest totalled EUR -19 million (-11).
Dividends received totalled EUR 7 million (7). Other financial items
developed positively due to the favourable development of derivative
interest differentials despite the negative impact from fair value
adjustments. Profit before taxes amounted to EUR 516 million (372).
Taxes in the review period amounted to EUR 127 million (106). The
profit for the financial period amounted to EUR 389 million (265).
Earnings per share were EUR 3.88 (2.74). Return on Investment (ROI)
was 32% (26). Return on Equity (ROE) was 31% (21).
BALANCE SHEET, FINANCING AND CASH FLOW
Cash flow from operating activities for January-December 2008
totalled EUR 278 million (431). Liquid reserves at the end of the
period amounted to EUR 197 million (296). Net interest-bearing loan
capital amounted EUR 455 million (-27). Going forward Wärtsilä's
financial room to manoeuvre is secured by committed long-term finance
agreements. Advance payments at the end of the period totalled EUR
1,243 million (860). The solvency ratio was 34.3% (45.9) and gearing
was 0.39 (-0.01). The main reason for the drop in solvency relates to
dividends paid, balance sheet growth and the decrease in
mark-to-market bookings of assets and hedges.
HOLDINGS
Wärtsilä owns 7,270,350 B shares in Assa Abloy, or 2.0% of the total.
This holding has been registered in the balance sheet at its market
value at the end of the reporting period, EUR 59 million.
CAPITAL EXPENDITURE
Gross capital expenditure during the review period totalled EUR 366
million (231), which comprised EUR 198 million (65) in acquisitions
and investments in securities, and EUR 168 million (166) in
production and information technology investments. Investments
related mainly to the increase in capacity and the expansion of the
Services activities around the world. Depreciation for the review
period amounted to EUR 99 million (78).
Due to continued volume growth, efficiency improvements and Services
related logistical development plans, the total capital expenditure
excluding acquisitions for 2009, is expected to be approx. EUR 180
million.
SUSTAINABLE DEVELOPMENT
Wärtsilä's Sustainability Report, which is part of the annual report,
is prepared in accordance with the GRI G3 guidelines. It represents a
balanced and reasonable view of Wärtsilä's economic, environmental
and social performance. The Sustainability Report is assured.
PERSONNEL
Wärtsilä's personnel on average during the review period was 17.623
(15.337). At the end of December Wärtsilä had 18,812 (16,336)
employees, an increase of 15%. The largest personnel increases took
place in the Services business where 11,011 (9,563) people were
employed at the end of December.
During the review period Wärtsilä launched a Top Graduates
professional programme for R&D. During the programme, attendees will
drive R&D projects throughout Wärtsilä's international organisation.
Similar programmes for finance and IM graduates have been in place
since March 2007.
STRATEGIC ACQUISITIONS, JOINT-VENTURES AND EXPANSION OF THE NETWORK
In March, Wärtsilä signed an agreement to acquire the Norwegian
company Maritime Service AS, which specialises in ship service, and
mechanical and reconditioning services. Maritime Service has its
operations in Ålesund, on the west coast of Norway. The annual net
sales of Maritime Service were NOK 26 million (EUR 3.2 million) in
2007.
In April, Wärtsilä acquired the Danish company International
Combustion Engineering A/S (I.C.E.) that specialises in project
engineering and the service and repair of steam boilers and ancillary
burner systems. The company's annual net sales amounted to DKK 46.8
million (EUR 6.3 million) in 2007. This acquisition expands
Wärtsilä's service offering into the new type of boiler services,
which in turn further improves Wärtsilä's competitiveness as a
leading total services provider. Wärtsilä continued to expand its
boiler services capability in June with the acquisition of the boiler
services business of I.C.E.'s former subsidiary in Dubai.
In June, Wärtsilä acquired the German company Claus D. Christophel
Mess- und Regeltechnik GmbH (CDC), which specialises in the design,
delivery and service of automation systems for ship owners and yards.
CDC's annual net sales were EUR 2.1 million in 2007.
In July, Wärtsilä signed an agreement to acquire the global ship
design group Vik-Sandvik, a leading independent group providing
design and engineering services to ship owners and the ship building
industry worldwide. This acquisition was a major step in Wärtsilä's
strategy to strengthen its position as a total solutions provider and
to be the most valued partner for its customers. By combining ship
design capability with its existing offerings in propulsion systems
and automation, Wärtsilä will be able to provide more added value to
its customers, with further growth potential in new lifecycle
services. Wärtsilä's goal is to become the leading provider of ship
design services in various segments. The value of the acquisition was
EUR 132 million, with an additional maximum sum of EUR 38 million to
be paid based on the performance of the business over the next three
years. In 2007, Vik-Sandvik's net sales were EUR 55 million and the
profitability is at a very good level. The number of employees is
410. Vik-Sandvik has been included in the consolidation since August
1, 2008.
In September, Wärtsilä acquired Navelec SAS, a French company
specialising in marine navigation and communication systems,
electrical marine services, and control and automation services.
Through this acquisition Wärtsilä is able to broaden its service
offering and technological knowledge in the areas of navigation and
communications. It also strengthens Wärtsilä's position as the
leading service provider within electrical marine and automation
services. Navelec's annual net sales were EUR 7 million in 2007. The
company employs 45 people.
In September Wärtsilä continued to expand within the field of ship
design with the signing of an agreement to acquire Conan Wu &
Associates Pte Ltd (CWA), a leading naval architecture and ship
design company in Singapore. The deal also includes partnership
agreements regarding CWA's businesses in Malaysia and China. The
price of the deal is EUR 23 million with an additional amount to be
paid based on the performance of the business during the years
2008-2010. In 2007, CWA's net sales were EUR 10.7 million and the
profitability was at a very good level. CWA has 66 employees in
Singapore. The acquisition price was paid and the company
consolidated during the fourth quarter.
The total cost of the above acquisitions was EUR 215 million, and EUR
126 million was reported as goodwill. The goodwill of Vik-Sandvik was
EUR 97 million.
In July, Wärtsilä Corporation and the Manara Consortium formed a
joint venture, Manara Wartsila Power Ltd (MWP), which aims to become
the leading developer of decentralised independent power producer
(IPP) projects in Islamic countries. Wärtsilä owns 19.9% of the
company.
In September, Wärtsilä and Metso signed a contract to form a joint
venture combining Metso's Heat & Power business and Wärtsilä's
Biopower business. The new joint venture is one of Europe's leading
providers of medium- and small-scale power and heating plants,
focusing on renewable fuel solutions. Metso owns 60% and Wärtsilä 40%
of the joint venture. It is estimated that in 2008 the consolidated
annual pro forma net sales of the joint venture was approximately EUR
130 million, and the number of employees approximately 200. All
regulatory approvals required for the closing of the transaction were
received during the fourth quarter of 2008. The order book relating
to the BioPower business, EUR 116 million, was transferred to the
joint venture at the end of the year and was thereby eliminated from
Wärtsilä's order book.
During the review period, Wärtsilä Services continued the expansion
of its network by opening and expanding offices and workshops in
Namibia, Chile, Brazil, Madagascar, Azerbaijan, China, Turkey and
Dubai. Geographical expansion continues to be part of Wärtsilä's
strategic focus.
OTHER STRATEGIC INITIATIVES
Wärtsilä intends to strengthen its international customer service by
centralising its spare parts logistics, and by building a new spare
parts distribution centre in the Netherlands. A large and modern
central warehouse will be built near the company's current service
unit. By this action Wärtsilä seeks faster and more efficient
deliveries of spare parts. The distribution centre will become fully
operational in mid 2011.
Wärtsilä and Emerson Process Management announced the expansion of
their global offshore alliance in June. Under the expansion, the
companies can now deliver integrated energy and automation systems
for Floating Production Storage and Offloading (FPSO) vessels and for
semi submersible oil and gas drilling rigs. The collaboration between
the companies began in 2006 within an alliance that at the time
covered mainly FPSO vessels.
The importance of Asia as a shipbuilding hub has increased during
recent years. In order to be closer to the main shipbuilding markets,
the senior management of Wärtsilä Ship Power has relocated to
Shanghai.
MANUFACTURING
During the fourth quarter Wärtsilä established a new global
environmental products know-how unit, known as Delivery Centre
Ecotech. The unit will focus on developing and delivering
environmental technologies, as well as products for emissions
reduction and efficiency improvement. By centralising the broad and
outstanding know-how that exists within the company, Wärtsilä will
strengthen its global leadership position in offering environmental
technologies for power solutions.
In Vaasa, Finland an important environmental initiative was taken by
launching a modernisation programme to reduce energy consumption in
test bed facilities. Wärtsilä is further promoting similar
initiatives globally.
During 2008, new license agreements were signed for the manufacturing
and sale of Wärtsilä low-speed marine diesel engines with Jiangsu
Rongsheng Heavy Industries Group Co. Ltd. (RSHI), Zhenjiang CME Co.
Ltd. (CME) and CSSC-MES Diesel Co. Ltd. (CMD) in China.
In 2008, capacity additions were made in Korea, Norway and India. In
Korea the Wärtsilä-Hyundai Engine Company, a joint venture with
Hyundai Heavy Industries, was inaugurated. This 50/50 joint venture
company manufactures Wärtsilä 50DF dual fuel engines for LNG carriers
and other applications. In Rubbestadneset, Norway, Wärtsilä extended
its gear plant. This extension will strengthen Wärtsilä's position as
leading provider of power solutions to marine customers globally. In
Khopoli, India, Wärtsilä inaugurated the extension of its plant for
auxiliary units and modules for power stations. This new extension
will cater to the demand for supplying auxiliaries all over the
world. In Shanghai, China, Wärtsilä inaugurated a new facility
related to quality assurance and optimised supply management that
will further strengthen the Asian supply chain.
The investment programmes for enhancing productivity in Trieste,
Italy and for the extension of propulsion capacity in Drunen, the
Netherlands as well as in Zhenjiang, China have proceeded during
2008. These programmes are important for the execution of Wärtsilä's
record high order book.
RESEARCH & DEVELOPMENT
During 2008 several R&D milestones were passed. The HALT-chamber
(Highly Accelerated Life Test) was inaugurated in January at the
University of Applied Sciences in Vaasa. The HALT project is executed
in cooperation between Wärtsilä and the University of Applied
Sciences. Highly Accelerated Life Test methods provide a way to
efficiently develop products to reach increased lifetime and
reliability.
In May, Wärtsilä and Mitsubishi Heavy Industries Ltd. signed a joint
development agreement to design and develop new small, low-speed
marine diesel engines of less than 450 mm cylinder bore. This
agreement is an extension of the strategic alliance created by
Wärtsilä and Mitsubishi in September 2005.
During the second quarter, the new RTX-4 full-scale, low-speed
research engine was inaugurated in the Diesel Technology Centre in
Winterthur, Switzerland. This large research engine is employed to
further develop Wärtsilä low-speed marine diesel engines to meet
market needs
The first RT-flex 82C common rail engine successfully completed its
official shop test in September at the Hyundai Heavy Industries Co.
Ltd. licensee facilities in Korea. The engine is an addition to
Wärtsilä's low speed engine portfolio and has been developed in
collaboration with Hyundai Heavy Industries.
The Wärtsilä fuel cell power plant at the Vaasa Housing Fair in
Finland was inaugurated during the third quarter. The fuel cell unit,
developed by Wärtsilä, is based on planar solid oxide fuel cell
(SOFC) technology, and is the first of its kind in the world. The
plant is fuelled by methane gas originating from a nearby landfill, a
gas that would otherwise be harmful to the environment. The fuel cell
power plant produces both electricity and heating for the residential
area's needs. In the next stage the fuel cells will be tested for
other applications.
In October, the International Maritime Organization (IMO) approved
amendments to the MARPOL Annex VI regulations on ship emissions. The
amended regulation on NOx emissions will be introduced in two
additional tiers; Tier 2 represents a global 20% NOx reduction from
the present Tier 1 level and will come into force in 2011, and the
Tier 3 level in 2016 represents a massive 80% NOx reduction from the
present Tier 1 level when applied to specific designated NOx Emission
Control Areas. The engine concepts for meeting the Tier 2 NOx level
are ready for the whole Wärtsilä marine engine portfolio and some
engines are already pre-certified. For Tier 3, the "Selective
Catalytic Reduction" (SCR catalyst) represents a means by which the
level can already be achieved today. Wärtsilä has over 100 SCR
equipped engines in operation. Wärtsilä is currently investigating
and developing other measures to ensure cost efficient compliance
with IMO Tier 3 regulations. The revised Annex VI also sets limits on
the fuel sulphur content. Wärtsilä engines are designed for operation
on any fuel sulphur content.
In the engine laboratory in Vaasa, a 6-cylinder prototype of the new
Wärtsilä 34DF, dual-fuel gas engine, was introduced. Testing started
in order to confirm the performance of this new engine type. The
first orders for the new engine W20V46F for power plant applications
were received, and serial production has been started.
In 2008 Wärtsilä's research and development expenses totalled EUR 121
million (122), or 2.6% of net sales.
CHANGES IN MANAGEMENT
Atte Palomäki (43) M.Sc. (pol.) started as Group Vice President,
Corporate Communications and a member of the Board of Management on
March 1, 2008.
SHARES AND SHAREHOLDERS
In March Wärtsilä's A and B-series shares were combined. Following
this combination all shares now carry one vote and equal rights. The
combination of the share series involved a free share issue directed
to the holders of Series A-shares so that holders of Series A-shares
received one share free of charge for each nine Series A-shares. In
the directed share issue 2,619,954 shares were given. Trading with
the new and combined shares started on 27th of March 2008.
SHARES ON HELSINKI EXCHANGES
31 December 2008 Number of Number of Number of shares
shares votes traded 1-12/2008
WRT1V 98 620 565 98 620 565 147 205 344
1. Jan - 31 Dec. 2008 High Low Average 1) Close
WRT1V 52.40 15.50 35.41 21.01
1) Trade-weighted average price
31 Dec. 2008 31 Dec. 2007
Market capitalisation, 2 072 5 023
EUR million
31 Dec. 2008 31 Dec.
2007
Foreign shareholders 45.8% 50.0%
CHANGES IN OWNERSHIP
During the review period and in relation to the combination of the
share series and the directed free share issue, Wärtsilä was informed
of the following changes in ownership:
Following the transaction, the Fiskars Group's share of Wärtsilä
Corporation's votes decreased to less than 1/5 (20%). In total,
Fiskars Group holds 16,846,301 or 17.1% of Wärtsilä Corporation's
share capital and votes.
Varma Mutual Pension Insurance's share of Wärtsilä Corporation's
shares increased to more than 1/20 (5%) and its share of the votes
decreased to less than 1/10 (10%). Following the transaction Varma
holds 5,130,087 or 5.2% of Wärtsilä's share capital and total votes.
Svenska Litteratursällskapet i Finland r.f's share of Wärtsilä
Corporation's votes decreased to less than 1/20 (5%). Following the
transaction Svenska Litteratursällskapet holds 1,735,506 or 1.76% of
Wärtsilä's share capital and total votes.
The above-mentioned changes came into effect when the combined and
new shares were registered in the trade register on 26 March 2008.
OPTION SCHEMES
During the review period, Wärtsilä had one option scheme that ended
on 31 March 2008. All option rights of this 2002 option scheme were
exercised.
DECISIONS TAKEN BY THE ANNUAL GENERAL MEETING
Wärtsilä's Annual General Meeting on 19 March 2008 approved the
financial statements and discharged the members of the Board of
Directors and the company's President & CEO from liability for the
financial year 2007. The Meeting approved the Board of Directors'
proposal to pay a dividend of EUR 2.25 per share and an extra
dividend of EUR 2.00 per share for a total dividend of EUR 4.25 per
share.
The Annual General Meeting decided that the Board of Directors shall
have six members. The following were elected to the Board: Ms Maarit
Aarni-Sirviö, Mr Kaj-Gustaf Bergh, Mr Kari Kauniskangas, Mr Antti
Lagerroos, Mr Bertel Langenskiöld and Mr Matti Vuoria.
The firm of authorised public accountants KPMG Oy Ab was appointed to
be the company's auditors.
The Annual General Meeting approved the proposal of the Board of
Directors to amend the Articles of Association.
The Annual General Meeting approved the proposal of the Board of
Directors to direct a free share issue to holders of A shares and to
combine the Series A and Series B shares and the changes to the
Articles of Association.
ORGANISATION OF THE BOARD OF DIRECTORS
The Board of Directors of Wärtsilä Corporation elected Antti
Lagerroos as its chairman and Matti Vuoria as the deputy chairman.
The Board decided to establish an Audit Committee, a Nomination
Committee and a Compensation Committee. The Board appointed from
among its members the following members to the Committees:
Audit Committee:
Chairman Antti Lagerroos, Maarit Aarni-Sirviö, Matti Vuoria
Nomination Committee:
Chairman Antti Lagerroos, Matti Vuoria, Kaj-Gustaf Bergh
Compensation Committee:
Chairman Antti Lagerroos, Matti Vuoria, Bertel Langenskiöld
BOARD OF DIRECTOR'S PROPOSAL TO THE AGM 2009
The Board of Directors proposes to the Annual General Meeting to be
held on the 11 March 2009 that a dividend of 1.50 euros per share be
paid for the financial year 2008. Wärtsilä's distributable funds at
the end of the period totalled EUR 415,185,892.59 million. The Annual
Report 2008, including the financial review and the review by the
Board of Directors, will be available on the company website
www.wartsila.com on 20 February 2009. The printed Annual Report will
be available week 9.
RISKS AND BUSINESS UNCERTAINTIES
The global financial crisis has rapidly changed the economic
environment and the shipping market. Fears of an oversupply in some
vessel types have become evident and freight rates have fallen
drastically. The ship owners' asset values have dropped and, in some
cases, second hand values are not even available. In most parts of
the market, ordering a new vessel is not feasible as new build prices
are still high, despite the very recent softening. Banks have almost
completely ceased lending for new projects, opting to focus on
securing current vessels under construction. Some owners are facing
difficulties in taking delivery of their orders and trading of orders
is already taking place. The balance is gradually moving from a
shipyard market to a ship owners' market as orders have become
scarcer. The slippage in shipyard delivery schedules is also a risk
that affects the Ship Power business. Due to this uncertainty within
the shipbuilding markets, the risk of cancellation of vessel orders
has increased from the previous quarter. Wärtsilä sees a potential
cancellation risk of approximately EUR 800 million.
Even though the fundamentals within the Power Plant business remain
unchanged, the current financial crisis has an effect on the timing
of orders. The financing of some future projects may also face
difficulties. To date this risk has not materialised. Offering
activity remains at a high level. The funding of many future projects
appears to be secure, particularly in countries with continued GDP
growth. Government funded projects for utilities also seem to be on
the upturn, as economic stimulus packages are being implemented in
many parts of the world. Infrastructure projects are often
prioritised. As expected, the uncertainty in the market has created a
slowdown in the industrial self generation segment, in particular in
the mining industry where new investments are postponed, down-scaled
or put on hold. At the end of 2008, industrial self generation
projects represented 19% of the total order book of the Power Plants
business.
During the year the risk related to the uncertainty in the global
market for raw materials eased and raw material prices became more
stabilised. Constraints relating to the availability of key
components, previously limiting Wärtsilä's growth, has eased. Due to
the current market situation and economical development, Wärtsilä
closely monitors the impacts of the financial crisis on the whole
supply chain.
MARKET OUTLOOK
Due to the extensive financial crisis and the economic recession, the
shipbuilding and shipping environment is in a very different
situation compared to six months ago. Ordering activity for new
vessels has come to an almost complete stand still, and it is hard to
estimate at what point activity could start to pick up again. There
is an imbalance between vessel capacity and demand in certain vessel
segments such as bulk carriers and container vessels. Ship owners
have started to lay up parts of their fleet as well to reduce
operating frequency to balance the capacity. In the longer term, the
most decisive factor is how fast the market will be able to adapt to
this situation and regain balance. In addition to the general global
economical development, vessel order cancellations and scrapping of
older fleets will play an important role in the market's recovery.
In vessel segments of greater importance to Wärtsilä, such as
Offshore, Special vessels and Cruise&Ferry, there is still activity
on the market. However, difficulties in funding and stricter lending
conditions, are affecting these projects as well. These markets are
the ones most likely to pick up the fastest when the most acute phase
of the crisis is over.
Demand within the Power Plants market remains at a good level. The
need for a more efficient and CO2-friendly power generation mix
remains. The main drivers for demand in this market remain the quest
for increased efficiency, and versatility in power generation due to
environmental concerns and fuel availability issues. The flexible
baseload market segment is expected to remain active, especially
throughout the Middle East, Africa and the Americas. Continued
potential is seen in the grid stability services market in North
America as well as in other developed countries. A slow down will be
seen in the industrial self-generation market segment, especially in
mining but also in the cement industry. Wärtsilä's power plant
solutions are ideally suited for today's markets, which require high
efficiency and operational flexibility as well as environmental
sustainability. For Wärtsilä Power Plants, ordering activity is
estimated to be at a good level during the next two quarters.
Visibility into the timing of orders is harder to predict.
Services, which during the review period constituted 40% of total net
sales, continues its stable development.
The long order book and flexible manufacturing model, in combination
with the stable Services business and its global network, gives
Wärtsilä time to react to fluctuations in the market.
WÄRTSILÄ'S PROSPECTS FOR 2009
Despite the risk of cancellations, the substantial order book at the
end of the year should support a 10-20 percent growth in net sales
for 2009, which would maintain the profitability at last year's good
level.
WÄRTSILÄ FINANCIAL STATEMENTS BULLETIN 2008
This financial report is prepared in accordance with IAS 34 (Interim
Financial Reporting) using the same accounting policies and methods
of computation as in the annual financial statements for 2007 except
for the changes below. All figures in the accounts have been rounded
and consequently the sum of individual figures can deviate from the
presented sum figure.
Use of estimates
The preparation of the financial statements in accordance with IFRS
requires management to make estimates and assumptions that affect the
valuation of the reported assets and liabilities and other
information, such as contingent liabilities and the recognition of
income and expenses in the income statement. Although the estimates
are based on the management's best knowledge of current events and
actions, actual results may differ from the estimates.
Amended and new International Financial Reporting Standards (IFRS)
and Interpretations as of 1 January 2008:
- IFRIC 11 IFRS 2 - Group Treasury Share Transaction
- IFRIC 12 Service Concession Agreements
- IFRIC 13 Customer Loyalty Programmes
- IFRIC 14 IAS 19 - The Limit on Defined Benefit Asset, Minimum
Funding Requirements and their Interaction
- Amendments to IAS 39 and IFRS 7 - Reclassification of Financial
Instruments
Wärtsilä's consolidation method in joint ventures has changed from a
proportionate line by line consolidation to the equity method.
The adoption of the new and revised standards and interpretations
does not have any material effect on the interim financial report.
The figures in this financial statements bulletin are audited.
Consolidated Income Statement
MEUR 2008 2007
Net sales 4 612 3 763
Change in inventories of
finished goods & work in progress 304 59
Work performed by the Group and capitalized 7 8
Other income 26 21
Material and services -2 999 -2 249
Employee benefit expenses -854 -728
Depreciation -99 -78
Other expenses -474 -417
Share of profit of associates and joint
ventures 1
Operating result 525 380
Income from financial assets 7 7
Interest income 9 8
Other financial income 22 12
Interest expenses -27 -18
Other financial expenses -20 -16
Profit before taxes 516 372
Income taxes -127 -106
Profit for the financial period 389 265
Attributable to:
Equity holders of the parent company 380 262
Minority interest 9 3
Total 389 265
Earnings per share attributable to equity
holders of the parent company:
Earnings per share, EUR 3,88 2,74
Diluted earnings per share, EUR 3,88 2,73
Consolidated Balance Sheet, Assets
MEUR 31 Dec. 2008 31 Dec. 2007
Non-current assets
Intangible assets 244 202
Goodwill 549 445
Property, plant and equipment 435 365
Investment properties 11 13
Equity in associates and joint ventures 41 16
Investments available for sale 106 155
Interest-bearing investments 11 12
Deferred tax receivables 85 70
Trade receivables 3
Other receivables 12 7
1 498 1 283
Current assets
Equity in associates* 1
Inventories 1 656 1 081
Interest-bearing receivables 1 2
Trade receivables 891 874
Income tax receivables 14 11
Other receivables 486 201
Cash and cash equivalents 197 296
3 245 2 466
Assets 4 743 3 749
*Oy Ovako Ab has been liquidated 2008
Consolidated Balance Sheet, Shareholders'
equity and liabilities
MEUR 31 Dec. 2008 31 Dec. 2007
Shareholders' equity
Share capital 336 336
Share premium reserve 61 61
Translation differences -27 3
Fair value reserve 50 127
Retained earnings 764 788
Total equity attributable to equity holders
of the parent 1 184 1 315
Minority interest 15 10
Total shareholders' equity 1 199 1 325
Liabilities
Non-current liabilities
Interest-bearing debt 448 245
Deferred tax liabilities 86 81
Pension obligations 40 45
Provisions 24 25
Advances received 329 394
Other liabilities 1 3
927 792
Current liabilities
Interest-bearing debt 216 38
Provisions 165 139
Advances received 915 466
Trade payables 444 348
Income tax liabilities 58 35
Other liabilities 819 605
2 616 1 632
Total liabilities 3 544 2 424
Shareholders' equity and liabilities 4 743 3 749
Consolidated Cash Flow Statement
MEUR 2008 2007
Cash flows from operating activities:
Profit before taxes 516 372
Adjustments:
Depreciation 99 78
Financial income and expenses 9 8
Selling profit and loss of fixed assets and
other changes 2 -7
Share of profit of associates and joint
ventures -1
Cash flow before changes in working capital 626 450
Changes in working capital:
Current assets, non-interest-bearing,
increase (-) / decrease (+) -278 -162
Inventories, increase (-) / decrease (+) -561 -251
Current liabilities, non-interest-bearing,
increase (+) / decrease (-) 589 548
Changes in working capital 250 135
Cash flow from operating activities before
financial items and taxes 377 585
Financial items and taxes:
Interest and other financial expenses -45 -42
Interest and other financial income 50 15
Income taxes -104 -127
Financial items and taxes -99 -154
Cash flow from operating activities 278 431
Cash flow from investing activities:
Investments in shares and acquisitions -198 -65
Investments in tangible and intangible
assets -168 -166
Proceeds from sale of shares 9 7
Proceeds from sale of tangible and
intangible assets 21 2
Loan receivables, increase (-) / decrease
(+) and other changes 1
Dividends received from investments 7 7
Cash flow from investing activities -329 -214
Cash flow after investing activities 51 217
Cash flow from financing activities:
Issuance of share capital 4
New long-term loans 260 65
Amortization and other changes in long-term
loans -4 -33
Loan receivables, increase (-) / decrease
(+) 5
Current loans, increase (+) / decrease (-) 129 31
Dividends paid -412 -168
Cash flow from financing activities -26 -95
Change in liquid funds, increase (+) /
decrease (-) -76 122
Cash and cash equivalents at beginning of
period 296 179
Joint ventures' cash and cash equivalents
at beginning of period -18
Fair value adjustments, investments 1 1
Exchange rate changes -6 -6
Cash and cash equivalents at end of period 197 296
STATEMENT OF CHANGES IN SHAREHOLDERS'
EQUITY
Total equity attributable to equity holders
MEUR of the parent Minority Total
interest equity
Fair
Share value
and
Share issue Translation other Retained
capital premium differences reserves earnings
Shareholders'
equity on 1
January 2008 336 61 3 127 788 10 1 325
Translation
differences -23 -23
Other changes 4 4
Investments
available for
sale
gain/loss
from fair
valuation,
net of
taxes -37 -37
Cash flow
hedges
gain/loss
from fair
valuation,
net of
taxes -18 -18
transferred
to income
statement,
net of
taxes -22 -22
Net income
recognized
directly in
equity -23 -77 4 0 -96
Profit for
the financial
period -7 380 9 382
Total recognized
income an expense for
the period -30 -77 384 9 286
Dividends
paid -408 -4 -412
Shareholders'
equity on 31
Dec. 2008 336 61 -27 50 764 15 1 199
Shareholders'
equity on 1
January 2007 334 58 3 128 693 13 1 230
Translation
differences
Other changes -6 -5
Investments
available for
sale
gain/loss
from fair
valuation,
net of
taxes -18 -18
Cash flow
hedges
gain/loss
from fair
valuation,
net of
taxes 29 29
transferred
to income
statement,
net of
taxes -13 -13
Net income
recognized
directly in
equity -1 -6 -7
Profit for
the financial
period 262 3 265
Total recognized
income and expense
for the period -1 262 -2 259
Options
exercised 1 3 4
Dividends
paid -167 -1 -168
Shareholders'
equity on 31
Dec. 2007 336 61 3 127 788 10 1 325
Geographical segments Europe Asia Americas Other Group
MEUR
Net sales 2008 1 695 1 792 689 436 4 612
Net sales 2007 1 442 1 432 520 369 3 763
INTANGIBLE ASSETS AND PROPERTY, PLANT & EQUIPMENT
MEUR 2008 2007
Intangible assets
Book value at 1 January 646 602
Changes in exchange rates -30 -6
Acquisitions 191 47
Additions 29 33
Depreciation and impairment -42 -30
Disposals and intra-balance sheet
transfer -1
Book value at end of period 793 646
Property, plant and equipment
Book value at 1 January 377 315
Changes in exchange rates -3 3
Acquisitions 9 1
Additions 139 133
Companies sold -17
Depreciation and impairment -57 -48
Joint ventures' opening balances -6
Disposals and intra-balance sheet
transfer -13 -9
Book value at end of period 446 377
GROSS CAPITAL EXPENDITURE
MEUR 2008 2007
Investments in securities and
acquisitions 198 65
Intangible assets and property,
plant and equipment 168 166
Group 366 231
During the review period investment in the enlargement of propulsion
equipment manufacturing in the Netherlands and China amounted to EUR
12 million during the review period, and Wärtsilä had commitments
related to the enlargements amounting to EUR 6 million at the end of
the review period. In addition, Wärtsilä centralizes warehousing and
logistics of spare parts by investing in a new distribution centre
in the Netherlands. The investments to the new distribution centre
amounted to EUR 11 million during the review period.
IMPACT OF ACQUISITIONS ON THE CONSOLIDATED BALANCE SHEET
During the review period Wärtsilä has acquired a Norwegian company
Maritime Service AS, specializing in ship service, mechanical and
reconditioning services, a Danish company International Combustion
Engineering A/S, specializing in project engineering and the service
and repair of steam boilers and ancillary burner systems, the
boiler services business of International Combustion Engineering's
(I.C.E.) former subsidiary in Dubai and a German company Claus D.
Christophel Mess- und Regeltechnik GmbH (CDC) specializing in the
design, delivery and service of automation systems for ship owners
and yards. In addition, Wärtsilä has acquired a French company
Navelec SAS specializing in marine navigation and communication
systems, electrical marine services and control and automation
services, a global Norwegian ship design group Vik-Sandvik which
provides ship design and engineering services and a leading naval
architecture and ship design company Conan Wu & Associates Pte Ltd
(CWA), headquartered in Singapore.
2008
MEUR Vik-Sandvik Others
Acquisition costs 165 49
Acquired assets to fair value -68 -20
Goodwill 97 29
Specification of acquired assets:
Intangible assets 51 14
Property, plant and equipment 5 4
Investments available for sale 6
Inventories 4
Receivables 34 9
Cash and cash equivalents 24 3
Liabilities -4 -10
Deferred tax liabilities -47 -3
Total 68 20
INTEREST-BEARING LOAN CAPITAL
MEUR 31 Dec. 2008 31 Dec. 2007
Long-term liabilities 448 245
Current liabilities 216 38
Loan receivables -12 -14
Cash and bank balances -197 -296
Net 455 -27
FINANCIAL RATIOS 2008 2007
Earnings per share, EUR 3.88 2.74
Diluted earnings per share, EUR 3.88 2.73
Equity per share, EUR 12.01 13.70
Solvency ratio, % 34.3 45.9
Gearing 0.39 -0.01
PERSONNEL
2008 2007
On average 17 623 15 337
At end of period 18 812 16 336
CONTINGENT LIABILITIES
MEUR 31 Dec. 2008 31 Dec. 2007
Mortgages 61 13
Chattel mortgages 10 8
Total 71 22
Guarantees and contingent liabilities
on behalf of Group companies 664 479
Nominal amount of rents according
to leasing contracts 87 69
Total 751 548
NOMINAL VALUES OF DERIVATIVE INSTRUMENTS
MEUR Total amount of which closed
Interest rate swaps 140
Foreign exchange forward contracts 1 894 471
Currency options, purchased 50
COMMODITY DERIVATIVES Amount in of which
metric tons closed
Oil swaps 17 700 12 000
Copper futures 1 250
CONDENSED INCOME STATEMENT, QUARTERLY
10-12 7-9 4-6 1-3 10-12 7-9 4-6 1-3
MEUR /2008 /2008 /2008 /2008 /2007 /2007 /2007 /2007
Net sales 1 530 1 140 1 092 850 1 272 933 797 761
Other income 10 6 5 5 10 3 4 4
Expenses -1 313 -996 -953 -753 -1 114 -821 -710 -683
Depreciation and
impairment -31 -26 -21 -21 -22 -19 -18 -18
Share of profit of
associates and
joint ventures 1 -1 1 1
Operating result 197 123 124 81 147 96 73 64
Financial income
and expenses -14 5 7 -7 -1 -2 -1 -4
Profit before taxes 183 127 131 75 145 95 72 60
Income taxes -36 -30 -36 -25 -43 -26 -20 -17
Profit for the
financial period 147 97 96 49 103 68 52 42
Attributable to:
Equity holders of
the parent company 144 95 94 47 101 68 52 42
Minority interest 3 3 2 2 2 1 1
Total 147 97 96 49 103 68 52 42
Earnings per share attributable to equity holders
of the parent company:
Earnings per share,
EUR 1.46 0.97 0.96 0.49 1.05 0.71 0.54 0.44
Diluted earnings
per share, EUR 1.46 0.97 0.96 0.49 1.05 0.70 0.54 0.44
CALCULATION OF FINANCIAL RATIOS
Earnings per share (EPS)
Profit for the financial period attributable to equity holders of the
parent company
Adjusted number of shares over the financial year
Equity per share
Equity attributable to equity holders of the parent
company
Adjusted number of shares at the end of the period
Solvency ratio
Shareholders' equity x 100
Balance sheet total - advances received
Gearing
Interest-bearing liabilities - cash and bank balances
Shareholders' equity
29 January 2009
Wärtsilä Corporation
Board of Directors
Wärtsilä Corporation ENCLOSURE TO THE FINANCIAL STATEMENTS BULLETIN
30.1.2009
Proposal of the Board
The parent company's distributable funds total 415,185,892.59 euros,
which includes 246,281,834.83 euros in net profit for the year. There
are 98,620,565 shares with dividend rights.
The Board of Directors proposes to the Annual General Meeting that
the company's distributable earnings be disposed of in the following
way:
EUR
A dividend of 1.50 euros per share be paid,
making a total of 147.930.847,50 euros
That the following sum be retained in
shareholders' equity 267.255.045,09 euros
Totalling 415.185.892,59 euros
No significant changes have taken place in the company's financial
position since the end of the financial year. The company's liquidity
is good and in the opinion of the Board of Directors the proposed
dividend will not put the company's solvency at risk.
