Review by the President and CEO

President and CEO Kai Öistämö

Vaisala’s President and CEO Kai Öistämö

“Vaisala had an excellent start for the year 2022. The war in Ukraine and sanctions against Russia had no material impact on our performance, despite our decision to suspend all business with Russian and Belarussian customers. Strong demand that we enjoyed throughout 2021 continued during the first quarter. Our net sales grew by outstanding 29% and our order book reached all-time high EUR 169 million at the end of the quarter, which is 8% more than a year ago.

Our order intake grew in both business areas and in most of the market segments. Growth of orders received continued very strong in renewable energy market segment and aviation market segment took a big step in recovery towards pre-pandemic level. Strong development continued also in industrial instruments and life science market segments.

Industrial Measurements business area recorded 34% net sales growth and growth was strong in all market segments. Also, Weather and Environment business area’s 26% net sales growth is much higher than we have used to see. Net sales in renewable energy and meteorology markets segments grew strongly, and well in ground transportation. Despite strong order intake, net sales in aviation market segment were still somewhat lagging.

Our operating result more than doubled from previous year to EUR 17.5 million following net sales growth and gross margin improvement. During the first quarter, we committed to component spot purchases with EUR 6 million. Impact on gross margin was minor in the first quarter.

According to our updated strategy, we are managing three types of businesses: flagships, growth businesses, and emerging opportunities. As our first quarter excellent operating result margin of 14.8% showed, profitability was well managed across businesses while our net sales grew strongly. Growth businesses, like renewable energy and life science, reached strong growth and emerging opportunities are looking very promising. In Weather and Environment business area, acquisition of AerisWeather is driving development of our Data as a Service and Software as a Service businesses. Also, our recognitions in sustainability front continued. I am extremely proud of Vaisala being listed in the top 5 of the Financial Times’ European Climate Leaders 2022.

The war in Ukraine and sanctions against Russia had no direct material impact on Vaisala, however, they are affecting economic environment and have increased uncertainty to economic development. In addition, the pandemic situation especially in China and related shut down measures further increase economic uncertainty. Visibility to component availability remains weak and component supply constraints are expected to continue throughout 2022. Additional material costs related to spot purchases are expected to remain at high level during 2022. Despite these headwinds, we continue to estimate that our full-year 2022 net sales will be in the range of EUR 465–495 million and operating result (EBIT) to be in the range of EUR 55–70 million.”

Interim Report January-March 2022, April 29, 2022.