CARNEGIE NORDIC SMALL AND MID CAP SEMINAR

Transcription

1 CARNEGIE NORDIC SMALL AND MID CAP SEMINAR September 8, 2010 Teo Ottola, CFO 1

2 OUR BUSINESS IDEA IS TO IMPROVE MATERIALS HANDLING PRODUCTIVITY We deliver the highest lifecycle value by focusing on: MAXIMIZING THE PRODUCTIVITY OF UPTIME Maximizing the productivity of uptime Minimizing the cost of downtime Thus, we re not just lifting things, but entire businesses MINIMIZING THE COST OF DOWNTIME 2

3 OUR PRODUCTS AND SERVICES MANIPULATORS LIGHT LIFTING SYSTEMS STANDARD DUTY CRANES HEAVY DUTY CRANES YARD CRANES STRADDLE CARRIERS SHIP-TO-SHORE CRANES GOLIATH SHIPYARD CRANES NUCLEAR CRANES FORKLIFT TRUCKS AND REACH STACKERS SERVICE AND MODERNIZATIONS MACHINE TOOL SERVICE 3

4 OUR CUSTOMERS 2009 sales MEUR 1,671 4

5 OUR MARKETS Market size Market share Service Industrial and port cranes Open: > 3 BEUR > 20% Total: > 9 BEUR > 7% Industrial, port cranes Open: > 10 BEUR > 6% and machine tools Total: > 29 BEUR > 2% Equipment Hoists, components, > 6 BEUR ~ 15% industrial and process cranes, container handling equipment Total open market Excluding machine tools > 9 BEUR ~ 16% Including machine tools > 16 BEUR ~ 9% 5

6 BEST CUSTOMER SERVICE A UNIQUE BUSINESS IN THE INDUSTRY WITH ITS OWN RIGHT TO GROW Genuine service business starting from customers problems Preventive approach More value-added for customers through performance-based agreements as downtime costs more than the actual repair Own, dedicated management Outsourcing of service creates a win-win situation Konecranes can lower customers maintenance costs through better productivity for the service staff Increased density of the contract base for Konecranes 2/3 of the cranes still serviced in-house 3,200 service technicians around the world servicing cranes and machine tools of all makes 75% of the cranes in the contract base non- Konecranes equipment Growth potential not limited to own installed base 6

7 Q2/2010 REPORT 7

8 HIGHLIGHTS OF Q2/10 Positives Macroeconomic indicators continued to point to a recovery Service demand supported by higher capacity utilization among customer industries Signs of growth also in Equipment Negatives New equipment orders still relatively low, lacking large orders of heavy cranes Continued price competition especially in standard equipment Uncertainty on the sustainability of economic growth 8

9 CAPACITY UTILIZATION: EU27 AND USA SOURCES: Eurostat, Federal Reserve Bank of St. Louis 9

10 CONTAINER TRAFFIC Annual container handling volume Monthly container handling volume SOURCES: Drewry Container Annual 2009/2010, Drewry Freight Shipper Insight 10

11 ACQUISITIONS IN 2010 Four MTS companies: two in Denmark, one in the UK and the US Purchase of 22% of shares in Kito Crane service and MTS company in France Capex on acquisitions and investments in associated companies EUR 30 million in January-June Acquisitive impact approximately 3% on orders and sales in January- June 11

12 STRATEGIC ALLIANCE WITH KITO CORPORATION Purchase of 22% of shares for EUR 27 million For the year ended March 31, 2010, Kito s net sales amounted to EUR 182 million and operating profit to EUR 3.3 million Konecranes will sell Kito manual products; Kito will sell wire rope hoist made by Konecranes Enhances Konecranes presence in East Asia and North America Possibilities to expand cooperation 12

13 ENTRY INTO CHINESE HOIST BUSINESS Acquisition of 65% stake in Chinese hoist and crane manufacturer SANMA Strong position as a nationwide supplier of wire rope hoists in China and as a crane supplier in Jiangsu and the neighboring provinces Access middle segment market in China Net sales of approx. EUR 20 million and more than 500 employees Possibility to develop Konecranes manufacturing and sourcing in China 13

14 Q2/2010 GROUP ORDERS AND NET SALES Orders: (309.6) MEUR, +17.7% Net sales: (431.6) MEUR, -12.6% 14

15 Q2/2010 GROUP EBIT & MARGIN EBIT: 23.4 (30.7) MEUR, -23.8% Margin: 6.2% (7.1%), excluding restructuring costs 15

16 SALES SPLIT BY BUSINESS AREA AND REGION 16% R12M 59% 1,481 MEUR (FY ,671) 41% R12M 29% 1,481 MEUR (FY ,671) 55% 16

17 RETURN ON CAPITAL EMPLOYED * *The 2007 ROCE including capital gain was 50.4% 17

18 FUTURE PROSPECTS AS OF JULY 22, guidance for sales and operating profit reiterated, Equipment s demand outlook changed Demand for maintenance services supported by higher capacity utilization within customer industries Improved industrial production and container handling volumes have increased customers willingness to invest in new equipment too, but the decisionmaking is still conditional on the sustainability of economic growth Price competition to remain Growing 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 18

19 SERVICE 19

20 SERVICE: Q2/2010 ORDERS AND NET SALES Orders: (126.4) MEUR, +25.9% Net sales: (169.5) MEUR, +3.4% New orders grew in all geographic regions Strength in Modernization and Parts 20

21 SERVICE: Q2/2010 EBIT AND MARGIN EBIT: 16.0 (15.5) MEUR MARGIN: 9.1% (9.2%), excluding restructuring costs 21

22 SERVICE CONTRACT BASE June 30, (373) thousand units, -0.6% annual value (124.2) MEUR, +17.3% 22

23 EQUIPMENT 23

24 EQUIPMENT: Q2/2010 ORDERS AND NET SALES Orders: (202.6) MEUR, +8.4% Net sales: (293.0) MEUR, -24.4% Order intake rose in Americas and APAC, but fell in EMEA New orders increased in all business units except Port Cranes 24

25 EQUIPMENT: Q2/2010 EBIT AND MARGIN EBIT: 11.9 (20.5) MEUR MARGIN: 5.4% (7.0%), excluding restructuring costs 25

26 BALANCE SHEET AND CASH FLOW 26

27 Q2/2010 NET WORKING CAPITAL (260.8) MEUR 13.0% (12.8%) of sales 27

28 CASH FLOW BEFORE FINANCING ACTIVITIES MEUR capex on acquisitions and investments in associated companies

29 Q2/2010 GEARING Equity: (385.4) MEUR Net debt: 19.0 (35.5) MEUR Gearing: 4.7% (9.1%) 29

30 NOT JUST LIFTING THINGS, BUT ENTIRE BUSINESSES 30