Company Announcement No. 2-2018, 31 January 2019
Solid operating results and modestly positive outlook for 2019
Strongest order intake in six years
· Strong order intake
· Revenue growth resumed
· Strong performance in Mining
· Steps taken to improve profitability in Cement
· Low free cash flow
"The high order intake in 2018 is due to an improving mining market, but it also reflects the performance of our organisation, our position and strong lifecycle solutions. This combination lays a good foundation for future growth," commented Group CEO Thomas Schulz.
Revenue grew by 4% in 2018. The 13% growth in the order intake was attributable to Mining delivering 24% growth, especially driven by copper, while Cement was unchanged. The strong order intake bodes well for revenue growth in 2019.
EBITA was up by 5% in line with revenue, and the EBITA margin increased slightly to 8.5% from 8.4%.
The cash flow from operating activities was impacted by significant negative developments in discontinued activities, and the free cash flow amounted to only DKK 100m.
The return on capital employed rose to 11.0% from 10.4% in 2017 as a result of the higher EBITA and lower capital employed.
The proposed dividend is DKK 9 per share (2018: DKK 8).
Guidance for 2019
FLSmidth guides for revenue of DKK 19-21bn (2018: DKK 18.8bn) and an EBITA margin of 9-10% (2018: 8.5%). The return on capital employed (ROCE) is expected to be 12-14% (2018: 11.0%).
The positive trend in the mining industry is expected to continue in 2019 modestly, while cement market conditions are expected to be stable with global macroeconomic uncertainties for both industries.
Group CEO Thomas Schulz commented: "Both our cement and mining customers are constantly pursuing productivity improvements. As Productivity Provider #1, we are in the right spot to support their agenda and by taking innovation and digitalization to the next level, we will be an even stronger business partner going forward. Additional factors that will strengthen our competitiveness are our ongoing efforts to standardise our product offering and leverage our unique customer insight," said Thomas Schulz.
Nicolai Mauritzen, tel +45 36 18 18 51, email@example.com
Sofie Karen Lindberg, tel +45 30 93 18 77, firstname.lastname@example.org
Key figures 2018
|(DKKm)||Q4 2018||Q4 2017||Change (%)||2018||2017||Change (%)|
|Order intake (gross)||4,503||4,836||-7%||21,741||19,170||13%|
|- of which service order intake||2,680||2,693||0%||10,907||10,710||2%|
|Service order intake share||60%||56%||50%||56%|
|- of which service revenue||2,613||2,583||1%||10,208||10,473||-3%|
|Service revenue share||48%||52%||54%||58%|
|EBITDA before special non-recurring items||582||493||18%||1,826||1,732||5%|
|Free cash flow||46||602||-92%||100||952||-89%|
|Net working capital||2,200||1,833||+20%||2,200||1,833||+20%|
|Net interest-bearing debt||(1,922)||(1,545)||+24%||(1,922)||(1,545)||+24%|
For additional information, go to the Investors at www.flsmidth.com
Read the Annual Report 2018 here
FLSmidth delivers sustainable productivity to the global mining and cement industries. We deliver market-leading engineering, equipment and service solutions to our customers enabling them to improve performance, drive down costs and reduce environmental impact. Our operations span the globe and our 11,400 employees are present in more than 60 countries. In 2018, FLSmidth generated a revenue of DKK 18.8 billion. www.flsmidth.com