Wartsila: R&D focus. File image/Pixabay.
Marine engineering firm Wartsila has posted weaker profits in its first quarter results.
Pre-tax profits fell by 45% compared to the same period a year ago.
And with the coronavirus pandemic reshaping business activity, the company has scrapped its market outlook for 2020 until such time as the market's direction is more clearly delineated.
"Demand in the first quarter was reasonable considering the prevailing market conditions," said Jaakko Eskola, president and chief executive of the Finnish firm.
"The decline in marine order intake was largely due to the lack of scrubber investments, as fuel spreads have narrowed," he added.
The executive also noted that the pandemic has "severely affected" the cruise sector leading to "several energy project sites [being] demobilised".
Under present market conditions, the company has lowered its cost based by around EUR 100 million ($107m). However, research and development (R&D) remain central to what Wartsila is about, Eskola said.
"We remain committed to investing in R&D projects that are critical to our long-term success... [and] are actively working on developing the use of alternative, commercially viable and environmentally friendly fuels to reduce greenhouse gas emissions in the shipping and energy sectors."
"Advances have been made in testing the use of ammonia in our engines and fuel systems, as well as the funding we have received for the X-Ahead project.
"The aim of this project is to develop deep expertise in the technical and business potential of Power-to-X, which will be used to promote a carbon neutral economy.
"These initiatives are indicative of our commitment to enabling sustainable societies with smart technology."