Metso Corporation's stock exchange release on November 12, 2013 at 1:30 p.m. local time
Metso Corporation's Extraordinary General Meeting approved a demerger plan on October 1, 2013, pursuant to which all the assets, debts, and liabilities relating to Metso's Pulp, Paper and Power businesses will transfer without liquidation to Valmet Corporation. Metso's Mining and Construction segment and Automation segment will form Metso's continuing operations.
The demerger is expected to be registered in the Finnish Trade Register on or about December 31, 2013, after which Valmet shares will be admitted for public trading on NASDAQ OMX Helsinki on or about January 2, 2014.
A prospectus relating to Valmet Corporation, an entity to be established as part of Metso's partial demerger, was published on September 23, 2013 and is available on Metso's website (www.metso.com).
Basis of the Preparation of Unaudited Illustrative Financial Information
The following unaudited illustrative financial information is presented to illustrate the result of operations and the financial position of Metso's continuing operations had the demerger taken place on January 1, 2012. The unaudited illustrative information in respect of Metso set out below is based upon financial information derived from Metso's audited consolidated financial statements as of and for the year ended December 31, 2012, restated for the impact of the adoption of revised IAS 19 "Employee Benefits", and from Metso's unaudited consolidated interim report as of and for the nine month period ended September 30, 2013.
This unaudited illustrative information is presented for illustrative purposes only. Because of its nature, it addresses a hypothetical situation and does not represent the actual results of Metso's operations or financial position had the demerger been completed on January 1, 2012. This information is not intended to project Metso's operational results or financial position of Metso as of any future date.
Management believes that the illustrative information presented in this release provides a relevant basis to present the result of operations and the financial position of the continuing Metso Group. The adjustments made in preparing this information are based on available information and assumptions. There is no certainty that the assumptions applied in preparing the unaudited illustrative information will prove correct.
The following significant assumptions and adjustments to such historical information have been made in the preparation of the illustrative financial information for Metso's continuing operations:
All the revenues, expenses, assets, and liabilities relating to the PPP business have been excluded from Metso's reported consolidated financial information.
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The effects of certain intra-group arrangements that have been or will be undertaken by Metso prior to the demerger in order to achieve the planned legal group structures of both Metso and Valmet have been taken into account, as have the effects of certain refinancing measures, including a settlement of intra-group items between Metso and Valmet. The net settlement of the intra-group balances has been treated as an adjustment to cash and cash equivalents for consolidated balance sheet purposes (a decrease of EUR 102 million as of December 31, 2012 and an increase of EUR 51 million as of September 30, 2013), reflecting the cash amount to be paid by Metso to Valmet or vice versa to settle the balances.
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The total amount of equity derived from Metso's historical equity balance shown in the illustrative consolidated balance sheets represents the amount of net assets attributable to the PPP business. The adjustments made to equity reflect the contemplated equity structure of Valmet Corporation as described in the demerger plan.
Accounting treatment of the demerger
The demerger will be accounted for as a disposal to owners in accordance with IFRIC 17, Distributions of non-cash assets to owners. Once the demerger takes place, the difference between the fair value of the PPP business and its book value in Metso's consolidated balance sheet will be recorded as a gain on distribution. The PPP business to be divested through the demerger will be presented as discontinued operations in Metso's financial reporting when shareholders have approved the demerger.
| KEY FIGURES FOR METSO GROUP / AFTER DEMERGER | |||||||
| EUR million | As at and for the nine months' ended Sept.30, 2013 | As at and for the year ended Dec. 31, 2012 | |||||
| Net sales, total | 2,989 | 4,499 | |||||
| Operating profit | 299 | 463 | |||||
| Profit before taxes | 256 | 404 | |||||
| Amortization of intangible assets | -16 | -20 | |||||
| Depreciation of tangible assets | -46 | -57 | |||||
| Non-recurring items | |||||||
| Capacity adjustment expenses | 0 | -12 | |||||
| Cost related to demerger process | -1 | 0 | |||||
| Other NRE | -21 | 0 | |||||
| EBITA, before non-recurring items | 337 | 495 | |||||
| EBITA, % before NRE | 11.3 % | 11.0 % | |||||
| EBITDA | 361 | 540 | |||||
| Earnings per share, EUR | 1.21 | 1.82 | |||||
| Shares (Metso's outstanding shares, period average) | 149,813,092 | 149,715,383 | |||||
| Balance sheet total | 3,915 | 4,000 | |||||
| Equity | 1,232 | 1,359 | |||||
| Interest-bearing liabilities | 1,107 | 1,094 | |||||
| Net debt | 491 | 385 | |||||
| Gearing | 39.9 % | 28.3 % | |||||
| ROCE before taxes | 17.6 % | 19.2 % | |||||
| ROCE after taxes | 12.9 % | 13.8 % | |||||
| Equity to assets ratio | 36.5 % | n/a | |||||
| Orders received | 2,962 | 4,432 | |||||
| Order backlog | 2,078 | 2,269 | |||||
| Personnel, at the end of period | 18,658 | 17,665 | |||||
| EBITA, before non-recurring items: | Operating profit + amortization + non-recurring items | ||||||
| EBITDA | Operating profit + depreciation and amortization | ||||||
| Earnings per share, EUR | Profit | ||||||
| Number of outstanding shares of Metso, average | |||||||
| Gearing, % | Net interest bearing liabilities | x 100 | |||||
| Total equity | |||||||
| Return on capital employed (ROCE) before taxes, % | |||||||
| Profit before taxes + interest and other financial expenses | x 100 | ||||||
| Balance sheet total - non-interest bearing liabilities | |||||||
| Return on capital employed (ROCE) after taxes, % | |||||||
| Profit + interest and other financial expenses | x 100 | ||||||
| Balance sheet total - non-interest bearing liabilities | |||||||
| Equity to assets ratio, % | |||||||
| Total equity | x 100 | ||||||
| Balance sheet total - advances received | |||||||
Metso is a global supplier of technology and services to customers in the process industries, including mining, construction, pulp and paper, power, and oil and gas. Our 30,000 professionals based in over 50 countries contribute to sustainability and deliver profitability to customers worldwide. Metso's shares are listed on the NASDAQ OMX Helsinki Ltd.
www.metso.com, www.twitter.com/metsogroup
Further information, please contact:
Juha Rouhiainen,VP, Investor relations, Metso Corporation, tel +358 20 484 3253
Metso Corporation
Harri Nikunen
CFO
Juha Rouhiainen
VP, Investor Relations
Distribution:
NASDAQ OMX Helsinki Ltd
Media
www.metso.com
