Download ppt - Q3 2010 interim report

© 2010 Konecranes Plc. All rights reserved.

October 21,2010Pekka Lundmark, President and

CEOTeo Ottola, CFO

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Q3 2010INTERIM REPORT


HIGHLIGHTS OF Q3/10

• Positives– Key macroeconomic indicators continued to point to a recovery– Improving new equipment demand– Improved EBIT margin in Equipment thanks to higher volume,

successful cost savings, favorable product mix, FX tailwind

• Negatives– New equipment orders still relatively low in developed markets– Continued price competition especially in standard equipment

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Q3 ORDERS RECEIVED Y/ Y EMEA AME APACSERVICEEQUIPMENT


CAPACITY UTILIZATION: EU27 AND USA

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SOURCES: Eurostat, Federal Reserve Bank of St. Louis

77,5

64

66

68

70

72

74

76

78

80

82

84

86

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

2005 2006 2007 2008 2009 2010

Capacity utilisation of manufacturing in EU

74,7

72,4

64

66

68

70

72

74

76

78

80

82

84

86

Jan 2005

Jul 2005

Jan 2006

Jul 2006

Jan 2007

Jul 2007

Jan 2008

Jul 2008

Jan 2009

Jul 2009

Jan 2010

Jul 2010

Capacity utilisation in the USA

Total industry Manufacturing


CONTAINER TRAFFIC

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SOURCES: Drewry Container Annual 2009/2010, Drewry Freight Shipper Insight

Annual container handling volume Monthly container handling volume

0

100

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600

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

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2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

Million teu

-25 %

-20 %

-15 %

-10 %

-5 %

0 %

5 %

10 %

15 %

20 %

25 %

Change Y/Y


MARKET OUTLOOK AND FINANCIAL GUIDANCE AS OF OCT 21, 2010

• The demand for maintenance services is expected to continue to be above last year’s level due to higher capacity utilization within customer industries

• The demand for new equipment is expected to remain robust in Asia-Pacific and in emerging markets in general while customers’ decision-making is still conditional on the sustainability of economic growth in western Europe and North America

• Price competition to remain

Financial guidance unchangedGrowing demand will support

our sales and profitability already during the second half of 2010

However, due to the low first half year sales we expect full year 2010 sales to be lower than in 2009

Operating profit in 2010 expected to be lower than in 2009 before restructuring costs

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COMBINATION OF ORGANIC AND ACQUISITIVE GROWTH

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0

500

1000

1500

2000

2500

MEUR

11% CAGR6% ORGANIC GROWTH

1. Our main strategy is to grow organically2. In M&A, our first priority are bolt-on

acquisitions3. We also keep an open mind towards

larger M&A


ACQUISITIONS IN 2010

• Five MTS companies: two in Denmark and in the UK, one in the US

• Crane service and MTS company in France

• Purchase of 22% of shares in Kito

Capex on acquisitions and investments in associated companies EUR 35.1 million in January-September

Acquisitive impact approximately 4% on orders and 3% on sales in January-September

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ACQUISITION OF INDIAN WMI CRANES

• One of the leading suppliers of heavy-duty cranes in India

• Development of offering in India, adds in India to supply and sourcing network, enhances service business in India

• Acquisition in two phases within a year, maximum price approx. EUR60m

• Net sales of EUR30m, order book of more than EUR50m, good order prospects

• Approximately 350 people and additionally contracted workforce of about 600 persons

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*Closing subject to regulatory approvals


Q3/2010 GROUP ORDERS AND NET SALESOrders: 373.4 (308.5) MEUR, +21.0% | Net sales: 393.6 (368.7) MEUR, +6.8%

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0

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ORDERS SALESMEUR


Q3/2010 GROUP EBIT & MARGINEBIT: 34.3 (24.0) MEUR, +42.5% | Margin: 8.7% (6.5%), excluding restructuring costs

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0 %

2 %

4 %

6 %

8 %

10 %

12 %

14 %

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MEUR EBIT MARGIN


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2003 2004 2005 2006 2007 2008 2009 1-9/09 1-9/10

MEUR

1-9/2010 GROUP ORDERS RECEIVED1 058.3 (987.7) MEUR, +7.1%

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GROUP ORDER BOOK September 30, 2010679.7 (638.4) MEUR, +6.5%

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MEUR


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2003 2004 2005 2006 2007 2008 2009 1-9/09 1-9/10

MEUR

1-9/2010 GROUP NET SALES1 076.9 (1 242.4) MEUR, -13.3%

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1-9/2010 GROUP EBIT & MARGINEBIT: 69.2 (91.6) MEUR | MARGIN: 6.4% (7.4%), excluding restructuring costs

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0 %

2 %

4 %

6 %

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12 %

14 %

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2003 2004 2005 2006 2007 2008 2009 1-9/09 1-9/10

MEUREBIT MARGIN


SALES SPLIT BY BUSINESS AREA AND REGION (R12M)

15

59% 41%

17%

30% 54%

R12M1,506 MEUR

(FY 2009 1,671)

R12M1,506 MEUR

(FY 2009 1,671) (56)(29)

(16)

(63) (37)


ROCE %

RETURN ON CAPITAL EMPLOYED

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24.3

17.8

10.8

17.2

29.5

46.2*

56.3

19.3 18.8

13.7

*The 2007 ROCE including capital gain was 50.4%


SERVICE

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SERVICE: Q3/2010 ORDERS AND NET SALESOrders: 152.4 (124.5) MEUR, +22.4% | Net sales: 173.2 (157.6) MEUR, +9.9%

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• New orders grew in all regions and business units

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180

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Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10

ORDERS SALESMEUR


SERVICE: Q3/2010 EBIT AND MARGINEBIT: 14.6 (13.9) MEUR | MARGIN: 8.4% (8.8%), excluding restructuring costs

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• Streamlining costs of EUR 1.5 million in Q3/10

0 %

1 %

2 %

3 %

4 %

5 %

6 %

7 %

8 %

9 %

10 %

0

2

4

6

8

10

12

14

16

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Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10

MEUR EBIT MARGIN


SERVICE CONTRACT BASE September 30, 2010377 (371) thousand units, +1.6% | annual value 146.6 (122.6) MEUR, +19.6%

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0

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50 000

100 000

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350 000

400 000

2001 2002 2003 2004 2005 2006 2007 2008 2009 Q3/10

NUMBER OF EQUIPMENT VALUE MEURUNITS


SERVICE ORDER BOOK September 30, 2010111.7 (88.1) MEUR, +26.8%

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0

20

40

60

80

100

120

Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10

MEUR

© 2010 Konecranes Plc. All rights reserved. 22

EQUIPMENT


EQUIPMENT: Q3/2010 ORDERS AND NET SALESOrders: 240.0 (205.9) MEUR, +16.5% | Net sales: 252.6 (233.5) MEUR, +8.2%

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• Order intake rose in EMEA and APAC, but fell in the Americas due to low port crane orders

• New orders increased in all business units except Port Cranes

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Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10

ORDERS SALESMEUR


EQUIPMENT: Q3/2010 EBIT AND MARGINEBIT: 22.0 (14.0) MEUR | MARGIN: 8.7% (6.0%), excluding restructuring costs

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• EBIT margin improved due to higher volume, cost savings, sales mix and currencies

0 %

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Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10

MEUR EBIT MARGIN


EQUIPMENT ORDER BOOK September 30, 2010 585.6 (565.6) MEUR, +3.5%

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Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10

MEUR


BALANCE SHEET AND CASH FLOW

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Q3/2010 NET WORKING CAPITAL183.3 (211.1) MEUR | 12.2% (11.2%) of sales

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0 %

2 %

4 %

6 %

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14 %

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Q1/08 Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10

MEUR NWC, MEUR NWC EXCL. DIVIDENDS, MEUR

% OF R12M SALES % OF SALES EXCL. DIVIDENDS


-50

0

50

100

150

200

2001 2002 2003 2004 2005 2006 2007 2008 2009 1-9/09 1-9/10

MEUR

CASH FLOW BEFORE FINANCING ACTIVITIES

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110.3

-28.6

44.1

35.4

6.9

-30.4

179.1

70.2

181.8

2.3

16.6

36.2 MEUR capexon acquisitions andinvestments inassociated companies


Q3/2010 GEARINGEquity: 415.7 (389.1) MEUR | Net debt: 0.7 (-14.9) MEUR | Gearing: 0.2% (-3.8%)

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26.3% 24.4%

8.8%

2.8%

10.0%9.1%

-3.8%

-19.1%

-12.4%

4.7%

0.2%

-25 %

-15 %

-5 %

5 %

15 %

25 %

35 %

45 %

55 %

65 %

-150

-100

-50

0

50

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Q1/08 Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10

MEUR EQUITY NET DEBT GEARING


APPENDIXES

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STATEMENT OF INCOME

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Q3 2010 MEUR

Q3 2009MEUR

% Change

Sales 393.6 368.7 6.8

Other operating income 0.8 0.4

Depreciation and impairments -7,8 -7.4

Other operating expenses -352,3 -351.5

Operating profit 34.3 10.2 236.8

Share of associates’ and joint ventures’ result 0.3 -0.7

Financial income and expenses -1.8 -2.3

Profit before taxes 32.7 7.2 354.8

Taxes -9.7 -3.0

Net profit for the period 23.0 4.2 442.8


BALANCE SHEET

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MEURSeptember

30, 2010September

30, 2009MEUR

September 30, 2010

September 30, 2009

Non-current assets

338.1 256.3 Equity 415.7 389.1

Inventories 279.6 303.0Non-current

liabilities114.4 93.5

Other current assets

419.8 400.5 Provisions 53.2 54.9

Cash and cash equivalents

103.3 88.5Current

liabilities557.4 510.9

Total assets 1 140.7 1 048.4Total equity and

liabilities1 140.7 1 048.4


CASH FLOW STATEMENT

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MEUR Q3 2010 Q3 2009

Operating income before change in net working capital 41.2 17.2

Change in net working capital -2.9 57.4

Financing items and taxes -6.3 -8.4

Net cash from operating activities 32.1 66.2

Cash flow from investing activities -10.9 -9.2

Cash flow before financing activities 21.2 57.0

Proceeds from options exercised and share issues 0.0 0.2

Change of interest-bearing debt -6.3 -64.2

Net cash used in financing activities -6.3 -64.0

Translation differences in cash -6.7 -1.4

Change of cash and cash equivalents 8.2 -8.4

Cash and cash equivalents at beginning of period 95.1 96.9

Cash and cash equivalents at end of period 103.3 88.5

Change of cash and cash equivalents 8.2 -8.4


KEY FIGURES

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Q3 2010MEUR

Q3 2009MEUR

% Change

Sales 393.6 368.7 6.8

Operating profit (EBIT), including restructuring costs 34.3 10.2 236.8

Profit before taxes 32.7 7.2 354.8

Net profit for the period 23.0 4.2 442.8

Cash flow from operating activities 32.1 66.2 -51.6

Cash flow from operating activities per share (EUR) 0.54 1.12 -51.7

Interest bearing net debt 0.7 -14.9 -105.0

Gearing (%) 0.2 -3.8 -105.3

Solidity (%) 42.9 43.7 -1.8

Return on capital employed (%), (R12M) 18.8 32.7 -42.5

Return on equity (%), (R12M) 14.8 26.7 -44.6

Equity per share (EUR) 6.97 6.59 5.8

Investments total (excl. acquisitions) 11.3 13.9 -18.3

Personnel at end of period 9 795 9 419 4.0

Personnel on average during the period 9 677 9 720 -0.4


Finnish companies and organizations

Finnish households

Foreign owners

Nominee registered

THE LARGEST SHAREHOLDERS

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Trading information•Listing: NASDAX OMX Helsinki•Date of listing: March 27, 1996•Segment: Large Cap•Sector: Industrials•Trading code: KCR1V•1-9/10 average daily trading volume 379,831 shares, EUR 8.6 million

Market cap > EUR 1 billionLargest shareholders on September 30, 2010

Nr of shares

% of all shares

1 Htt 2 Holding Oy Ab 6,215,568 10.02%

2 Gustavson Stig, Chairman of the Board of Konecranes

2,038,490 3.29%

3 Varma Mutual Pension Insurance Company

2,005,275 3.23%

4 Nordstjernan Ab 1,380,024 2.23%

5 Ilmarinen Mutual Pension Insurance Company

1,295,891 2,09%

6 Nordea Funds 1,187,990 1.92%

7 Sigrid Juselius Foundation 638,500 1,03%

8 Folkhälsan non-governmental organization Svenska Finland Rf

535,600 0,86%

9 KCR Management Oy 517,696 0.84%

10 The State Pension Fund 500,000 0.81%

Konecranes’ treasury shares 2,524,760 4.07%

Nominee registered shares 28,575,006

46.09%

Other shareholders 14,587,320

23.52%

Total number of shares 62,002,120

100,00%

36.1%

13.2%

4.6%

46.1% *)

*) According to the flagging notification on September 8, 2010 BlackRock Inc. holds 6,271,713 (10.2%) Konecranes shares.


CONTACT INFORMATION

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Pekka Lundmark, President and CEOTel. +358 (0)20 427 2000 [email protected]

Teo Ottola, Chief Financial OfficerTel.+358 (0)20 427 2040 [email protected]

Miikka Kinnunen, Director, Investor RelationsTel. +358 (0)20 427 [email protected]

Anna-Mari Kautto, Assistant, Investor RelationsTel. +358 (0)20 427 [email protected] www.konecranes.com


THANK YOU!

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