Oct 25, 2022 | Maritime business news

Announcing the group’s financial result for the July-September 2022 period, which showed a good order intake but profitability is still challenging, Wärtsilä’s president and CEO Håkan Agnevall (pictured) said that “The decarbonisation journey will transform our industries and Wärtsilä is very well positioned to play a key role there.”

Agnevall said: “During the third quarter of 2022, uncertainty about economic development and geopolitical tensions continued. Intensifying cost inflation, prevailing disturbances in supply chains, tightening monetary policies, and challenging macro environment are creating turbulence within the global business environment. Despite the challenging market conditions, we were able to clearly grow our order intake.

“In the marine markets, the service business remained on a good track. The active cruise fleet has been well over 90% on average during the quarter, the offshore fleet witnessed increasing utilisation and day rates, and the demand for LNG cargoes has exceeded the available supply. However, the demand for new ships has moderated during the year, as many shipyards are operating at close to full capacity, and prices have increased. Our position as a frontrunner in marine technology was demonstrated with an order to supply a propulsion package for the world’s largest aluminium catamaran. It will operate between Argentina and Uruguay with our dual-fuel engine technology. Total order intake increased by 36% and service order intake by 27%.”

The comparable operating result decreased by 6%, mainly due to cost inflation, a less favourable sales mix between equipment and services, higher storage volumes, and declined profitability of Voyage, which is to be integrated into Marine Power as a business unit.

Agnevall continued: “On the technology side, we introduced the new Wärtsilä 25 medium-speed four-stroke engine, designed to accelerate and support the maritime sector’s efforts in achieving decarbonised operations. The engine is already capable of operating on diesel, LNG, or on either gas or liquid carbon-neutral biofuels. In the future it can easily be upgraded to operate with future carbon-free fuels as they become available. The Wärtsilä 25 engine is intended to be the first Wärtsilä engine to run on ammonia as a fuel.”

The group anticipates that cost inflation will remain high in the last quarter of 2022, which will be countered by price realisation and continuous improvement to mitigate the impact of inflation.

Agnevall concluded: “Order intake and sales are growing and we are making considerable progress in developing the solutions to shape the decarbonisation of marine and energy. We are moving up the service value ladder and increasing the performance-based service agreements. We are also simplifying our organisation and are addressing our cost structure. The decarbonisation journey will transform our industries and Wärtsilä is very well positioned to play a key role there.”

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