Review by the President and CEO

Vaisala’s President and CEO Kjell Forsén comments on the third quarter 2017

“In the third quarter, orders received were strong and exceeded one hundred million euros for the first time in Vaisala’s history. We entered the last quarter of this year with a 26% higher order book than a year ago. In Weather and Environment Business Area, third-quarter order intake growth was outstanding at 50% year-on-year and included several large project orders. Finally, following almost ten years of negotiations, we were able to book the first project phase amounting to EUR 6.3 million of the Vietnamese contract announced in February 2016. Deliveries started during the third quarter, and Vietnam is expected to allocate budget funds for the second phase still this year. Demand was exceptionally strong in meteorology customer segment, and we signed among others several contracts for automatic radiosonde launching systems. In transportation and renewable energy customer segments demand did not improve. In Industrial Measurements Business Area, order intake slightly decreased compared to strong previous year due to slowness in Americas. However, orders continued to increase in APAC, and order book remained above ten million euros.

Third-quarter net sales increased by 6%. The increase came mainly from Weather and Environment Business Areas’s project deliveries, which increased by 51% compared to previous year. Industrial Measurements Business Areas’s net sales were all time high on quarterly level, even though year-on-year growth was modest 2%. Vaisala’s operating result was 16.9% of net sales, which is seasonally good as usually in third quarter. Industrial Measurements Business Area reached excellent operating result of 29.0% of net sales and Weather and Environment Business Area 12.3%.

In Weather and Environment Business Area’s Digital Solutions unit, our long-term target is to exceed 10% annual net sales growth. In order to reach this target, we have launched a new organization, reviewed the strategy and started infrastructure transition to cloud based solutions. Third-quarter operating result included EUR 0.8 million cost related to this transformation.

I am confident with our full-year outlook and we continue to estimate our full-year net sales to be in the range of EUR 310–340 million and the operating result (EBIT) in the range of EUR 32–42 million.”

Kjell Forsén

President and CEO

Interim Report January-September 2017, October 23, 2017​