Finland's Metso Outotec sets new targets after Q3 profit misses forecast
Adds detail, background
STOCKHOLM, Oct 28 (Reuters) - Finnish mining equipment maker Metso Outotec MOCORP.HE, fresh from the completion of its merger, outlined a new strategy and financial targets on Wednesday after posting quarterly core earnings below market expectations.
The engineering group, formed through the tie-up of Metso Minerals and Outotec earlier this year, also said it would sell its Recycling business, which had sales of 156 million euro last year.
Pekka Vauramo, whom the company announced separately would continue as chief executive through the end of 2023, said in a statement Metso Outotec had selected the areas where it would focus going forward.
"The aggregates and minerals industries have clear roles at the core of our strategy," he said, adding the group would begin a restructuring and turnaround program to improve financial performance in its Metals business.
Third-quarter adjusted operating earnings (EBITA) at Metso Outotec fell to 109 million euro ($128.8 million) from 153 million in the year-ago quarter to come in below the 125.6 million seen in a poll of analysts commissioned by the company.
The Finnish company said it would target an adjusted operating margin (EBITA) of at least 15% over a business cycle - the margin stood at 11.4% through the first three quarters of 2020 - and pay out dividends of at least 50% of its earnings per share.
In the short term, Metso said it expected market activity to remain at the current level, subject to a possible worsening of the Covid-19 pandemic.
Fellow Nordic mining gear makers, Sweden's Sandvik SAND.ST and Epiroc EPIRa.ST had both reported a pick-up in demand from mining clients in their recent quarterly reports.
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(Reporting by Helena Soderpalm; Editing by Simon Johnson and Niklas Pollard)
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