Comments on Q4 and full year 2016
“Vaisala’s fourth quarter order intake was very strong
reaching all time high EUR 93.0 million. Orders received increased by 5% from
previous year and the increase was driven by 10% growth in Controlled
Environment Business Area with strong APAC and Americas. Also Weather Business
Area’s orders received developed positively during the fourth quarter. In
October, Vaisala signed a USD 18 million contract
with Bahamas’ Ministry for Transport and Aviation. This contract was a
consequence of outstanding customer service and Vaisala’s leadership in
Automatic Weather Observation Systems and weather radars.
Vaisala’s fourth quarter net sales decreased by 8% from
previous year’s record high net sales and amounted to EUR 93.0 million.
Controlled Environment Business Area’s strong performance continued with 8% net
sales growth from previous year, while Weather Business Area’s net sales
decreased by 13% due to low orders received during the first three quarters of
2016. Fourth quarter operating result decreased to EUR 14.6 million following
In 2016, Weather observation market weakened, especially in
EMEA, compared to rather good previous two years. In APAC, Vaisala’s performance
improved in weather observation market thanks to a few large projects.
Industrial measurement market was favorable overall and Vaisala’s net sales
grew faster than the market. Vaisala’s orders received were EUR 311.3 million
and decreased by 3% from previous year. Controlled Environment Business Area’s
orders received increased in all regions and was strongest in APAC and
Americas, while Weather Business Area’s orders received decreased in
Transportation and Meteorology Infrastructure business units.
Despite the decline in order intake during 2016, Vaisala’s
net sales reached the previous year’s level and were EUR 319.1 million. Increased
investment in sales and marketing continued to pay off and Controlled
Environment Business Area’s net sales crossed the hundred million milestone.
The growth of net sales was excellent 11% reaching EUR 103.7 million and coming
from all regions. Weather Business
Area’s net sales decreased by 4% to EUR 215.4 million. Vaisala’s operating
result excluding write-down of intangible assets improved compared to previous
year and was strong at EUR 32.8 million or 10.3%
of net sales.
I want to thank all Vaisala employees for the strong
engagement to our business and strive for continuous improvement. The improved
quality, operational performance and customer satisfaction that has taken place
during the year would not have been possible without our employees’ outstanding
In 2016, strategy implementation continued with investments
in strategic growth areas in Weather and Controlled Environment Business Areas.
In Weather Business Area, we made an entry to the growing air quality
monitoring market by acquiring new technology, which measures pollution and
particles in the air. On the other hand, we reshaped successfully our
Transportation business to simplify structure and improve profitability. We
also decided to reorganize Weather Business Area from January 2017 onwards. The
new region-based organization is closer to customer and better aligned with the
strategy. In Controlled Environment, we continued investing in growth markets,
life science and power transmission. Regional expansion continued successfully
by contracting new distributors in countries with high industrial potential.
In 2017, Vaisala is expecting stable market for both weather
observation and industrial measurement. Weather observation market is expected
to improve in EMEA, APAC and Latin America and be stable in North America. In
China, weather observation market is expected to remain stable, even though
market conditions are currently difficult to project. Market outlook for
renewable energy solution is overall positive, even though growth of renewable
power capacity has decelerated. Market outlook for industrial measurement solutions
is stable globally, and Vaisala is expecting increase in 2017 deliveries.
We estimate our full-year
net sales to be in the range of EUR 310–340 million and the operating profit
(EBIT) in the range of EUR 32–42 million.”
Kjell Forsén, President and CEO
Financial Statement Release 2016, February 8, 2017