Andritz 4Q 19 Company News - Clean results almost in line, disappointing dividend
While Andritz's 4Q 19 group performance improved almost across the board, EBITA was slightly weaker than we had expected on the back of additional restructuring charges for capacity adjustments in Hydro and Pulp&Paper but were still in line with consensus. We calculate adj. EBITA of EUR 167.3 mn in 4Q, 3.6% below RCBe, due to a weaker than expected performance in Metals. Management toned down the wording for sales guidance for 2020 to a slight or moderate increase (i.e. between 0-5%) vs. a non-specified increase before but confirmed the EBITA outlook at the level of 2019 adjusted EBITA of EUR 456 mn. This is fully in line with consensus (EUR 455 mn) and tops our forecast of EUR 448 mn by a few millions. The guidance, however, does not account for a severe impact of the Covid-19 outbreak. The dividend proposal of EUR 0.7 (2.3% yield) was a major disappointment vs. our and consensus expectations (EUR 1.55 and EUR 1.45, respectively, per share).Andritzis develops production systems and industrial process solutions for standard and specialized products. Co. maintains five business areas. Pulp and Paper provides technology and services for production of various grades of pulp and fiber for the manufacture of paper, board and tissue. Metals develops and manufactures plants for the production of cold-rolled carbon steel, stainless steel, and non-ferrous metals strip. Environment and Process provides products and services for mechanical and thermal solid or liquid separation. Feed and Biofuel develops and produces equipment for production of feed. Hydro supplies turnkey electromechanical equipment and services for hydro power plants.
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