HELSINKI, April 24 (Reuters) – Finnish ship technology and power plant maker Wartsila missed first-quarter earnings expectations on Tuesday and said geopolitical uncertainty was slowing demand in the marine market.
In a phone interview following the quarterly report, Chief Executive Jaakko Eskola said Wartsila aimed to grow through acquisitions and that it continued to look at Rolls-Royce’s marine business, which the British company is reviewing for a possible sale.
Wartsila said the marine sector, which has been hit by overcapacity and lack of financing, was recovering, but not at the pace the company had anticipated.
“We are seeing that this geopolitical uncertainty impacts customers’ decision-making … merchant and offshore segments’ activity is not growing as we had thought,” Eskola said.
“It is a concern. Talks about trade war … they create uncertainty and make customers consider purchases a little longer.”
First-quarter earnings before interest, taxes and amortisation (EBITA) rose 9 percent to 98 million euros ($120 million), but fell short of the 118 million euros expected by analysts in a Reuters poll.
Shares in the company were down 4.3 percent at 0936 GMT.
“Wartsila’s profitability was a disappointment … we had also anticipated an improvement in their (marine) outlook,” said Inderes analyst Erkki Vesola, who has a “reduce” rating on the stock.
Eskola, however, said Wartsila was well-positioned for future growth and would look for further deals after announcing last month a plan to acquire navigation company Transas for 210 million euros.
Asked about Rolls Royce’s loss-making marine business, he said: “We will investigate all possible acquisition cases if they would support our strategy. Rolls-Royce Marine is of course very close to our strategy.”
Rolls-Royce Marine last year had sales of 1.1 billion pounds ($1.5 billion). Wartsila generated revenue of 1.3 billion euros at its Marine Solutions unit, but made roughly the same amount of service sales from ship customers.
($1 = 0.7172 pounds)
($1 = 0.8196 euros) (Reporting by Jussi Rosendahl; Editing by Louise Heavens and Mark Potter)
ROME (Reuters) – An Italian judge on Friday cleared three migrant sea rescue charities that had been accused of abetting irregular immigration in complicity with human traffickers, throwing out a case opened...
(Bloomberg) — The closure of one of the East Coast’s busiest ports after the collapse of Baltimore’s Francis Scott Key Bridge has so far not led to broad price increases,...
(Bloomberg) — An Iranian ship that’s been linked to Houthi attacks in the Red Sea is returning home, removing a prominent asset in the area as the Islamic Republic braces...
April 18, 2024
Total Views: 1491
Why Join the gCaptain Club?
Access exclusive insights, engage in vibrant discussions, and gain perspectives from our CEO.
This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.