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Introduction & Market Context
Metso (OTC:MXTOF) Oyj (HEL:METSO) presented its Q2 and Half-Year 2025 results on July 23, 2025, revealing a mixed performance with growing orders but declining profitability. The presentation, delivered by President and CEO Sami Takaluoma and CFO Pasi Kyckling, came as the company’s stock dropped 7.21% to €10.81 during the trading session, indicating investor concerns about the company’s financial performance.
The mining and aggregates equipment manufacturer reported order growth of 6% year-over-year, but this positive development was overshadowed by a 16% decline in adjusted EBITA and a 25% drop in earnings per share from continuing operations.
Quarterly Performance Highlights
Metso’s Q2 2025 results showed orders received increased to €1,234 million, up 6% from €1,162 million in Q2 2024. However, sales remained flat at €1,213 million compared to €1,214 million in the same period last year. The company’s profitability metrics declined significantly, with adjusted EBITA falling 16% to €171 million and the corresponding margin dropping to 14.1% from 16.9% a year ago.
As shown in the following comprehensive financial overview:
The company’s operating profit decreased 12% to €173 million, representing 14.2% of sales compared to 16.1% in Q2 2024. Earnings per share from continuing operations fell 25% to €0.12 from €0.16 a year earlier, showing a continued decline from the €0.14 reported in Q1 2025. Cash flow from operations remained relatively stable at €147 million, down just 3% from the previous year.
Segment Performance
The Aggregates segment showed strong order growth in North America and Europe, with orders received increasing to €331 million from €314 million in Q2 2024. Equipment orders grew by 14%, while services orders declined by 12%. Sales in this segment decreased to €320 million from €331 million, with the services share of sales dropping to 31% from 33%. Adjusted EBITA for Aggregates fell to €45 million from €55 million, with the margin declining to 14.1% from 16.6%.
The segment’s performance is illustrated in this chart:
The Minerals segment also demonstrated solid order intake, with orders increasing to €903 million from €847 million in Q2 2024. This growth was driven by strong small equipment and services orders, particularly in the copper and gold sectors. Equipment orders grew by 10% and services orders by 5%. Sales in this segment increased slightly to €892 million from €883 million, with services representing 64% of sales, down from 66% a year ago. Adjusted EBITA declined to €143 million from €152 million, with the margin dropping to 16.0% from 17.3%.
The following chart details the Minerals segment performance:
Detailed Financial Analysis
Metso’s income statement reveals the pressure on profitability despite stable sales. Net financial expenses increased significantly to €33 million from €16 million in Q2 2024, contributing to a 22% decline in profit before taxes to €140 million. The effective tax rate remained relatively stable at 24.2%, resulting in profit for the period from continuing operations of €106 million, down 21% from €134 million a year ago.
The detailed income statement provides further insight:
The company’s financial position shows increasing leverage, with net debt rising to €1,285 million from €1,036 million a year ago. The net debt to EBITDA ratio increased to 1.5 from 1.1, while gearing rose to 53.0% from 40.6%. During the quarter, Metso refinanced its credit facilities, establishing a new €700 million committed credit facility and issuing a new €300 million seven-year bond while tendering €130 million of outstanding 2027 notes.
Despite the profitability challenges, Metso’s cash generation showed improvement in the first half of 2025, with cash flow from operations reaching €343 million compared to €309 million in H1 2024. This improvement was primarily driven by better working capital management, as shown in the following chart:
Strategic Initiatives
Metso continues to invest in future growth through strategic acquisitions and operational investments. Recent acquisitions include Swiss Tower Mills Minerals, a screening business in China, and TL Solution for mill liner recycling. The company also divested its Ferrous business as part of its portfolio optimization strategy.
Capital investments include a new service center in Western Canada and a screen manufacturing center in Romania, aimed at strengthening the company’s global footprint and service capabilities.
On the sustainability front, Metso reported mixed progress against its key performance indicators. The company’s "Metso Plus" sustainability-linked sales were below target at €1,244 million, down 16% year-over-year. However, the company remains on track with its net zero target, achieving a 70% reduction in CO2 emissions in its own operations compared to the 2019 baseline.
The following chart illustrates Metso’s sustainability performance:
Logistics CO2 emissions reduction of 9% remains below the target of 20% by 2025, while the company exceeded its target for procurement spend from suppliers with science-based emissions targets, reaching 36.2% against a target of 30% by 2025.
Forward-Looking Statements
Metso’s market outlook indicates that activity in both the Minerals and Aggregates segments is expected to remain at current levels over the next six months. The company acknowledged that tariff-related turbulence could potentially affect global economic growth and market activity, though it did not provide specific guidance on how this might impact its business.
In the Q1 2025 earnings call, CEO Sami Takaluama had emphasized the company’s "strong management agenda and culture regarding margin resilience" and stated that they were "not expecting material direct impact of these tariffs now announced." However, the Q2 results suggest that margin pressure has intensified despite these assurances.
The company announced its upcoming Capital Markets Day, scheduled for October 2, 2025, at the Clarion Hotel Helsinki Airport in Finland, where it is expected to provide more details on its strategic direction and financial targets.
Given the declining profitability metrics and increasing debt levels, investors will likely be looking for concrete plans to address margin pressure and improve returns at this upcoming event, especially in light of the negative market reaction to the Q2 results.
Full presentation:
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