Sulzer Predicts Slower Growth in 2008
Swiss engineering group Sulzer posted a 24 percent rise in full-year order intake on Tuesday, boosted by demand in the oil and gas sector, but said the growth rate was likely to slow in 2008.
Order intake at the group, which makes pumps for the oil and gas industry as well as surface coatings for jet engines, rose to 4.05 billion Swiss francs ($3.71 billion), narrowly missing the 4.11 billion francs forecast on average in a Reuters survey of seven analysts.
Sulzer, which competes with Dallas-based pump maker Flowserve , said it expected order intake to remain at a high level in 2008 but that growth rates were likely to slow due to high comparative figures for 2007.
But despite the company's expectation of slower growth this year, Landsbanki Kepler analyst Christoph Ladner said he had expected an even more cautious outlook.
"Overall I think the results are positive," Ladner said.
Economic growth was seen slowing in the United States and Europe, but other areas should continue to be strong. Sulzer was upbeat about the oil and gas markets, but expects some weakening in the pulp and paper as well as in the general industries segments.
Sulzer's Pumps unit posted an 18.5 percent jump in orders to a record volume of 2.08 billion francs, thanks to the higher oil price, bigger projects and high energy demand in all regions.
Sulzer trades at around 12 times expected 2009 earnings, according to Reuters Estimates, at a discount to Flowserve, at around 14.