HELSINKI- Finnish engineering group Metso Outotec raised its cost synergy target to 120 million euros ($142 million) from 100 million euros, lifting the newly-merged company's shares by 3% on Wednesday.
Metso's minerals business merged with and Outotec on July 1 to form one of the largest global makers of machinery for the mining industry.
Metso Outotec, which reported its first quarterly earnings as a combined company, said in a statement that the timetable and scope of the synergies were better than forecast.
"The target is therefore raised ... and the implementation will be accelerated so that the run-rate of the synergies is expected to be realized by the end of 2021," it said.
Citi analyst Klas Bergelind wrote in a note that this was "a good thing" given "increased macro uncertainty".
Metso Outotec also reported proforma adjusted EBITA (earnings before interest, tax and amortisation) of 143 million euros for the second quarter, driven by solid product margins and rapid cost savings, but gave no year-on-year comparison.
Sales for the quarter stood at 1.047 billion euros, in line with preliminary expectation of 1.045 billion, after the company issued a profit warning last week.
(Reporting by Anne Kauranen; Editing by Louise Heavens and Alexander Smith) ((email@example.com; +358925166112;))