(Adds CEO, analyst comment, shares)
April 23 (Reuters) - Metso Outotec reported a bigger than expected jump in first-quarter profit on Friday on a recovery in demand, especially for its aggregates business, plus cost savings from last year’s merger that created the mining equipment group.
The aggregates business, which sells products like crushers, screens and feeders mostly for the construction industry, boosted its quarterly operating profit to 33 million euros from 13 million a year earlier.
The company said there was strong demand for its equipment in Europe and North America.
“There is some catching up going on regarding the orders which did not come through last year, but clients are also investing thanks to stimulus packages,” Chief Executive Pekka Vauramo told Reuters in an interview.
Metso Outotec’s shares rose 2%.
“Overall we view this as a solid set of results,” analysts at Credit Suisse said in a note.
The company, created by merging Outotec with the main business of Metso, said operating profit rose to 91 million euros ($109 million) from 68 million, beating the 84.5 million in a Refinitiv poll of analysts.
“Our orders received increased 2% during the quarter, which was largely driven by a strong demand in the aggregates market. In addition, both the Minerals and Metals segments have seen overall customer activity improving,” the company said.
Metso Outotec also said it was on schedule to reach an annual 120 million euros savings target from the merger. It has cut more than 1,000 overlapping positions and closed offices.
$1 = 0.8317 euros Reporting by Tarmo Virki in Tallinn; editing by Jason Neely, David Evans and Jane Merriman