Valmet (VALMT) Q4 2024 earnings summary

Executive summary

• Orders received reached a record EUR 5.8 billion in 2024, up 18% year-over-year, driven by a landmark EUR 1 billion pulp mill order in Brazil and growth in all segments, despite challenging market conditions.

• Net sales remained stable at EUR 5.36 billion, with increases in Automation and Services offset by a 16% decline in Process Technologies; comparable EBITA was EUR 609 million, flat year-over-year, with margin at 11.4%.

• Cash flow from operating activities reached a record EUR 554 million, reflecting improved earnings quality and strong working capital management.

• Strategic renewal work was initiated in Q4/24 to define future growth areas, simplify operations, and enhance efficiency.

• EPS declined 22% to EUR 1.52, mainly due to lower operating profit and higher net financial expenses.

Financial highlights

• Q4 orders received more than doubled to EUR 2.46 billion, with full-year orders up 18% to EUR 5,837 million; order backlog at year-end was EUR 4.5 billion, up 12% from 2023.

• Net sales for Q4 were EUR 1.53 billion (+2% year-over-year); full-year net sales declined 3% to EUR 5,359 million.

• Comparable EBITA for Q4 was EUR 192 million (up 5%); full-year comparable EBITA margin was 11.4%.

• Adjusted EPS for 2024 was EUR 1.93 (down from EUR 2.28); reported EPS dropped 22% to EUR 1.52.

• Cash flow from operations grew 57% to EUR 554 million.

Outlook and guidance

• Net sales and comparable EBITA for 2025 expected to remain at 2024 levels, reflecting a challenging market, especially in pulp and paper.

• Order backlog is 12% higher year-over-year, but EUR 200 million less is expected to be recognized as sales in 2025; approximately EUR 3.1 billion of order backlog expected to be realized as net sales in 2025.

• Dividend proposal of EUR 1.35 per share, unchanged from last year, with an 89% payout ratio, to be paid in two installments.

• Short-term market outlook: stable customer activity in Process Technologies and Automation; gradual improvement in Services, but with some uncertainty.