July 31, 2020 / 7:33 AM / 5 days ago

UPDATE 1-Andritz sees flat 2020 profit as order intake slumps

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VIENNA, July 31 (Reuters) - Engineering group Andritz expects 2020 sales to fall slightly and profitability to remain largely at last year’s level as orders drop amidst the global economic crisis, it said on Friday.

Order intake was down 42.2% and the order backlog at the end of the second quarter was 4.2% lower than last year, the Austrian group said.

Profit and sales in the April-June period still increased, mainly because Andritz processed large orders at its pulp and paper business, which makes machines for tissue, board and paper production. Adjusted earnings before interest, tax and amortisation (EBITA) rose 10% to 104.2 million euros ($123.9 million) and sales increased 5.7% to 1.66 billion euros.

Cash flow from operating activities fell 80% to 43.1 million euros.

Andritz, which also supplies production lines to the crisis-hit auto and metal manufacturing industries, said it plans to cut costs more in the months ahead. That could include further capacity cuts.

The group started to restructure its German Schuler unit, one of the world’s largest manufacturers of press lines and automation systems for the automotive and metal processing industries, a year ago.

The move, which included job cuts, was necessary as demand for the products Schuler makes in Germany is increasingly shifting to Asia, Andritz said at the time.

$1 = 0.8413 euros Reporting by Kirsti Knolle; editing by Thomas Seythal and Michael Shields

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