Jul 28, 2006. /Lesprom Network/. Highlights of the second quarter - New orders worth Euro 1,390 million were received in April-June, i.e. 16% more than in the corresponding period last year (Euro 1.2 billion in Q2/05). - The order backlog grew by 33% from the end of June 2005 and was Euro 2.9 billion at the end of June 2006 (Euro 2.2 billion at June 30, 2005). - Net sales increased by 14% and totaled Euro 1.2 billion (Euro 1.0 billion in Q2/05). - Operating profit was Euro 116.4 million, i.e. 10.0% of net sales (Euro 83.3 million and 8.1% in Q2/05). - Metso recognized a nonrecurring deferred tax asset of Euro 57 million in the income statement. - Earnings per share were Euro 0.97 (Euro 0.49 in Q2/05). - Net cash generated by operating activities was Euro 56 million (negative Euro 17 million in Q2/05). - Return on capital employed (ROCE) was 21.7% (17.3% in Q2/05). Metso’s market situation remained favorable during the second quarter, resulting in strong growth in orders received. “In the light of the continuing positive trend in all our business areas, we estimate that our organic growth alone will this year clearly exceed the set 10% growth target for net sales,” says Jorma Eloranta, president and CEO. Eloranta is also very pleased with the solid profitability development. “Our strong focus on sales management together with the good market situation is bringing results. Furthermore, our cost structure has remained healthy thanks to our firm commitment to profit-enhancement and continuous productivity improvement throughout Metso.” "Based on our strong order backlog and the favorable market outlook we expect that our good financial performance will continue also during the second half of the year, and our operating profit will clearly exceed the operating profit in 2005," says Eloranta. “At the moment our main challenge is to ensure that our delivery capability, especially in Metso Minerals and Metso Automation, continues to meet the robust market demand.” Short-term outlook No change has occurred in Metso’s market outlook during the first half-year. The favorable market situation is expected to continue in the civil engineering, mining and energy industries in 2006. The overall pulp and paper industry demand is expected to remain at least as satisfactory as in 2005. Of Metso Paper’s products, the market outlook for new paper and board machines is the strongest in Asia. In Euroope and in North America, demand for rebuilds is expected to level out. The markets for both new tissue machines and tissue machine rebuilds are expected to be good. The markets for new fiber lines are expected to remain brisk in South America and good in Asia. Based on the strong order backlog and the favorable market outlook, it is estimated that Metso's good financial performance will continue also during the second half of the year, and the operating profit will clearly exceed the operating profit in 2005. Metso's net sales are estimated to grow by clearly more than 10% in 2006. The estimates concerning Metso's net sales and operating profit do not include any changes resulting from acquisitions or divestitures. Metso is a global engineering and technology corporation with 2005 net sales of approximately Euro 4.2 billion. Its 22 000 employees in more than 50 countries serve customers in the pulp and paper industry, rock and minerals processing, the energy industry and selected other industries.