25 September 2002 – Finnish engineering group Wärtsilä today lowered expectations for its future profit potential blaming changes in market conditions.

The change in market conditions will affect both Wärtsilä Power Divisions profitability this year and the company’s timetable for reaching its long-term profitability targets, said the company in a statement released to the stock exchange. “In view of current outlook, operational profitability this year will remain below last year’s level of 4 per cent. Reaching the profitability target of 7-8 per cent will require global economic recovery leading to significant growth in demand.”

W?rtsil? said it expected to reach this profitability target only after 2003. Due to the slow order intake the company is taking measures to adjust to the current level of volume.

Global shipyard order intake began to grow modestly at the end of the first half of the year. Wärtsilä Marine’s order intake, likewise, picked up slightly but it is nonetheless well below expectations.

In the power plant markets uncertainty continues to prevail and investment decisions are being postponed. Wärtsilä is negotiating a number of power plant deals but these are not expected to affect this year’s net sales or result.

Wärtsilä’s Service division continues to grow, although more slowly than expected. The full-year net sales of the Power Divisions, however, is forecast to increase based on the current order book and acquisitions.

The market outlook for Imatra Steel continues to be uncertain. Net sales are forecast to grow as a result of growth in the forging business. The result will remain below last year’s level due to a decline in demand for special engineering steels. Imatra Steel has started to implement appropriate adjustment measures.