The final Shareholders’ Meeting of Neles was held on June 22, 2022, in Vantaa. The Shareholders’ Meeting adopted the final accounts of Neles in accordance with Chapter 16, Section 17 of the Finnish Companies Act, consisting of the financial statements and annual report for the financial period January 1, 2022–March 31, 2022. The Shareholders’ Meeting also resolved on discharging the members of the Board of Directors and the President and CEO of Neles from liability. Update on the integration of Flow Control into Valmet
The integration of Flow Control (former Neles) into Valmet is proceeding according to the plan. Active sales and marketing of Valmet’s whole offering was commenced in the second quarter, and implementation of several cost synergy actions regarding function costs, common locations and supply chain continued during the third quarter. Valmet expects to generate annual run rate synergies of approximately EUR 25 million, of which approximately 60 percent are expected to be achieved by the end of 2023 and approximately 90 percent by the end of 2024.
Russia’s invasion of Ukraine and sanctions on Russia
Due to Russia’s invasion of Ukraine, Valmet reviewed key contractual obligations, project schedules, and identified risks for projects that are delivered to Russia. Based on the review, Valmet identified projects that it estimates no longer to meet the criteria of a customer contract for revenue recognition purposes, and consequently made a reversal of approximately EUR 80 million to its order backlog during 2022.
On June 3, 2022, Valmet announced that it has initiated employee reductions, which will result in a 50 percent reduction in the number of employees in Russia in the first implementation phase. Consequently, Valmet recorded an expense of approximately EUR 20 million during 2022 for estimated restructuring costs, asset impairments and other exceptional items triggered by Valmet’s decision to withdraw from Russia. These costs have been reported in cost of sales, in selling, general and administrative expenses and in other operating expenses, and have been reported as items affecting comparability. Therefore they do not impact Comparable EBITA. At the end of September 2022, Valmet had a total of approximately 60 employees in Russia, working primarily in sales, engineering, maintenance and financial administration. Valmet does not have production in Russia. Approximately 2 percent of Valmet’s total net sales came from its Russian operations in 2021.
Valmet will withdraw from Russia completely and will continue to implement the withdrawal in stages as the review of implementation options is fully completed. Valmet complies with all sanctions and export regulations impacting business with Russia and Belarus and monitors the development actively.
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News conference and webcast for analysts, investors and media
Valmet will arrange a news conference in English as a live webcast at https://valmet.videosync.fi/2022-q3 on Wednesday, October 26, 2022, at 2:00 p.m. Finnish time (EEST). President and CEO Pasi Laine and CFO Katri Hokkanen will be presenting the results.
Recording of the webcast will be available shortly after the event at the same address.
It is possible to take part in the news conference through a conference call by registering through the link below:
https://call.vsy.io/access-9701
After the registration you will be provided phone numbers and a conference ID to access the conference. If you wish to ask a question during the conference, please dial *5 on your telephone keypad to enter the question queue.
All questions should be presented in English.
The event can also be followed on Twitter at www.twitter.com/valmetir.
Further information, please contact:
Pekka Rouhiainen, Vice President, Investor Relations, Valmet, tel. +358 10 672 0020
VALMET
Katri Hokkanen
CFO
Pekka Rouhiainen
Vice President, Investor Relations
DISTRIBUTION:
Nasdaq Helsinki
Major media
www.valmet.com
Valmet is a leading global developer and supplier of process technologies, automation and services for the pulp, paper and energy industries. With our automation systems and flow control solutions we serve an even wider base of process industries.
We aim to become the global champion in serving our customers. Our 17,000 professionals work close to our customers and are committed to improving our customers’ performance – every day.
The company has over 220 years of industrial history and a strong track record in continuous improvement and renewal. In 2022, a major milestone was achieved when the flow control company Neles was merged into Valmet. The combined company net sales in 2021 was approximately EUR 4.5 billion based on the respective company figures.
Valmet’s shares are listed on the Nasdaq Helsinki and the head office is in Espoo, Finland.
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