Metso Minerals sales reached record levels in 2006, but the company believes there is further growth to come and is reorganising to maximise its potential. Mike Woof reports
"From both growth and profitability standpoints, we are performing very well," said Metso Minerals Industries construction business line president Jouni Salo. "The reason for the change is that we know we can perform even better." According to Salo, Metso is moving away from being a very product orientated, engineering-led company and intends to become more responsive to customer demand. Under the new organisation, Metso will be better able to integrate demand from different market segments such as quarrying, contracting and construction with the varying needs of these sectors on a geographic basis.
However, Salo was keen to emphasise that this move is about developing the business. "This is a reorganisation and not a restructuring process. This is nothing to do with cutting jobs - we're looking to grow the company," he said.
Growth Markets
The company intends to move away from its reliance on the mining sector and develop its share of the quarrying and construction markets. Although growth in these sectors is lower than for mining, these industries are less cyclical and offer a good base for further expansion according to Salo and he added, "We have strong growth targets." Internationally, Metso shows a widespread base of operations and Salo said: "We have a very strong position in North America and in Western Europe. In Eastern Europe and Russia we're looking for more growth." However Salo recognises that not all of its growth targets can be achieved through increased sales of its current product lines. "We are looking for growth in two ways, organic growth and through acquisitions. In terms of organic growth, Asia and Eastern Europe are the key areas. We are looking for acquisitions in the construction market, a complimentary business. There are niches to add to our operation," he said.
There are some businesses Metso is particularly interested in, though for obvious reasons Salo was not able to name any names.
Quarry matters
In the key quarrying industry, Salo says Metso already has a substantial slice of the crushing and screening equipment business. "We already have over 20%," he said, adding that the company is not satisfied with this share.
Quarry solutions represent an interesting market, as there is a strong focus on aggregate quality. He said: "This is where we want to use our knowledge base. The demand for a high quality end product is increasing in the mobile side with contractors too." There are reasons for this and Salo outlined one key change, "Quarrying is increasingly being carried out by contractors and they demand quality machines and output." At the moment Salo believes Metso leads the worldwide market for crushing and screening equipment in the contracting and construction sectors, with a share of 15% or more. Salo is very aware that competition on price provides challenges and said: "A key side of our contractor business is to develop distribution and it'd be good to have more contractor-type machines."
Salo explained that while these would meet demands for more price competitive equipment in this sector, he emphasised that Metso's reputation for product quality would be upheld. "Our current plan is to develop simpler products but we don't have a plan to compete with the price-driven market. There are certain types of contractors that fit our profile," he explained. "Firms like
We are concentrating on markets and segments where we know we can compete." Quarrying presents many challenges but Salo believes his company's experience in this sector and its ability to offer an array of solutions will win it opportunities over its competitors. The quarrying industry is changing and Salo said, "Plants will be more complicated. Future stationary installations will be larger and more complex," he said. Salo explained that this will meet demand from aggregate users who want different sizes of products to higher qualities than at present, and factors such as cubicity are becoming crucial for some users.
Green solutions
Environmental issues are increasingly important for quarrying companies, particularly in Europe where regulations grow tighter almost every day. Rather than just supplying machines, Metso intends to offer its customers solutions to challenges facing the quarrying sector. "We have several products to reduce noise and dust emissions," he said. "Environmental issues are clearly becoming more important." Some of these solutions are based around established principles such as encapsulating conveyors and discharge points or using water mist systems to minimise dust emissions. Automation can also help and Salo said: "How you run the plant can define how much dust it produces."
Monitoring the load and speed of the plant in real-time and adapting performance to ensure efficient throughput will help. "Optimising the system not only increases the production output but you can also control noise and dust levels." Salo explained: "We can help customers by auditing the plant to see how it is operating." Salo pointed out that while other companies focus on selling new machines to tackle reliability issues, this service might mean Metso will miss out on certain deals. However he said that in the long term it reinforces the message that efficient customer support takes top priority with Metso. "We are selling know-how," Salo said.
The company's wide knowledge base of the quarrying sector is also being complimented by new technical developments.
Traditionally, technicians working on screens have used the same methods to evaluate wear and tear on machines. However, Metso has developed a screen analyser tool that gives a much more accurate view of running performance and can help reduce unscheduled downtime. This unit monitors energy consumption, the stroke of the screen decks, the condition of the bearings and the overall structure. He said: "In most instances when you look at screens it's the structure or the bearings that fail." This service tool is so new it has only just been given a name, the Metso LSB (for longtitudinal measurement, structural measurement and bearing measurement). It will inevitably be used for problem solving at sites according to Salo and interestingly, the tool can also be used on equipment from competing companies.
Salo explained that the reason why Metso pulled out of having a stand at this year's
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