Review by the President and CEO
Vaisala’s President and CEO Kjell Forsén comments on the second quarter 2018
“Vaisala’s second quarter net sales grew by 7% year-on-year and with comparable currency rates growth was double digit. Growth was strong in Americas for Weather and Environment Business Area and in APAC for Industrial Measurements Business Area. In Weather and Environment Business Area, net sales grew by 5% following 49% increase in project deliveries, partially due to revised revenue recognition rules. In Industrial Measurements Business Area, net sales increased by 10% thanks to continued strong instrument deliveries globally and especially in APAC.
Despite good net sales growth, sales mix including higher share of Weather and Environment Business Area’s project business reduced average gross margin, and operating result was lower than previous year’s level. Also, capacity building projects burdened average gross margin.
Order intake was exceptionally low and decreased by 12% from previous year. In Weather and Environment Business Area order intake was lowest for two years. Especially project orders were at a low level. Industrial Measurements Business Area’s instrument orders continued strong and order intake increased by 2%. With comparable exchange rates the increase was three times the euro increase.
Deliveries of the next generation continuous monitoring system, viewLinc, started well and the new product generation was well received. Customer’s feedback for vaporized hydrogen peroxide measurement probe has been excellent and sales volumes have met our expectations. Modest performance continued in digital solutions and power transmission during the quarter.
Market outlook for weather observation and industrial measurement solutions is expected to remain unchanged in all other areas except in China. Demand for weather observation solutions in China has further weakened during the quarter. Also, high share of project business is expected to affect Weather and Environment Business Area’s and Vaisala’s profitability negatively in the second half of 2018. Industrial Measurements Business Area’s key markets are expected to remain at healthy level. We continue to estimate our full-year 2018 net sales to be in the range of EUR 330–350 million and operating result (EBIT) in the range of EUR 35–45 million."
President and CEO
Half Year Financial Report January-June 2018, July 20, 2018