KCI KONECRANES H1/2006: STRONG GROWTH AND MARGIN IMPROVEMENT CONTINUES
KCI KONECRANES PLC STOCK EXCHANGE RELEASE 3 August, 2006 10.00 a.m. 1 (14)
KCI KONECRANES H1/2006: STRONG GROWTH AND MARGIN IMPROVEMENT CONTINUES
Second quarter order intake set a new record: 369.2 MEUR.
January - June (H1/2006) orders 701.9 MEUR (growth 41.4 %, organic 21.7 %).
H1/2006 sales 636.6 MEUR (growth 48.9 %, organic 28.7 %).
H1/2006 operating profit (EBIT) 35.0 MEUR (13.9 MEUR).
H1 EBIT margin improved to 5.5 % (3,2 %), Q2 margin to 6.2 % (3,8 %).
H1 net income was 20.7 MEUR (-0.6 MEUR) and earnings per share 36 cents (-1
cent).
Acquisition of MMH Holdings, Inc completed; numbers consolidated as of 1 June.
Full year sales growth expectation raised from over 35% to 40-45%.
Second quarter First half year LY
MEUR 4-6/ 4-6/ Change 1-6/ 1-6/ Change 1-12/
SALES 06 05 % 06 05 % 05
Maintenance Services 119.6 98.7 21.2 222.3 184.9 20.2 406.5
Standard Lifting
Equipment 136.2 69.6 95.7 254.2 133.6 90.3 318.0
Special Cranes 104.5 79.0 32.3 202.9 140.4 44.5 331.1
Internal Sales -20.4 -12.6 61.9 -42.8 -31.5 35.9 -84.8
Sales total 339.9 234.8 44.8 636.6 427.4 48.9 970.8
Operating profit 21.0 9.0 134.0 35.0 13.9 152.3 49.3
(EBIT)
Share of result of
associated companies
and joint ventures 0.4 0.2 0.3 0.2 0.5
Interests, net -2.1 -1.7 -4.5 -3.1 -6.8
Other financial income
and expenses -1.6 -6.6 -1.3 -11.9 -9.0
Income before taxes 17.6 0.9 1805.2 29.5 -0.9 3297.4 34.1
Net income 12.4 0.7 1649.4 20.7 -0.6 3341.5 24.1
Earnings per share,
basic (EUR) 0.21 0.01 0.36 -0.01 0.43
Earnings per share,
diluted (EUR) 0.21 0.01 0.35 -0.01 0.42
ORDERS RECEIVED
Maintenance Services 104.1 84.5 23.2 200.8 163.0 23.2 364.5
Standard Lifting
Equipment 160.3 80.6 98.9 307.0 156.5 96.2 322.1
Special Cranes 124.3 131.5 -5.5 239.4 210.8 13.6 463.3
Internal Orders -19.5 -17.5 11.4 -45.4 -33.7 34.7 -88.7
Orders Received total 369.2 279.1 32.3 701.9 496.5 41.4 1061.2
Order book at end of
period 640.7 414.7 54.5 432.1
Comment on first half year result:
The strong demand continued, and the second quarter order intake set another
record. Manufacturing output increased, boosting H1 sales growth to 48,9 %. The
growth is well balanced: all Business Areas and geographical regions report
healthy growth. The improving operational efficiency led to better margins.
Second quarter EBIT margin was 6.2 %, while it was 3.8 % a year ago. Margins
improved in all Business Areas. The return on capital employed increased to 22.6
% and return on equity to 30.2 % on last twelve month basis.
2 (14)
Comment on full year 2006 result:
At the moment we see no signs of slowing demand. Full year sales growth is
expected to be 40-45 %. The positive margin development is expected to continue.
Pekka Lundmark, President & CEO:
"The positive development of all key aspects of our business continued in the
second quarter. The strong demand for both new equipment and maintenance services
continued in all geographical regions, and we were able to significantly increase
our manufacturing output. The sales growth of nearly 50 % demonstrates clearly
improved market shares. As expected, all business areas showed improving margins.
The operating margin in both Maintenance Services and Standard Lifting is clearly
ahead of last year, despite the recent acquisitions diluting the Standard Lifting
margin. Special Cranes has recovered to a more reasonable level, but a lot of
work is still needed before the target level is reached. Our return on capital
employed continued to increase, now at 22.6 % on last twelve month basis.
The second quarter saw the completion of another major acquisition, as a KCI
Konecranes subsidiary bought 100 per cent of the shares in MMH Holdings, Inc, the
owner of U.S. based Morris Materials Handling, Inc. I am very pleased to welcome
our new colleagues, close to one thousand, to the team. The acquired business
with its large installed base of cranes, and good position especially within the
American process industries provides us with very exiting opportunities for the
future".
At the moment we see no signs of a slowdown in overall demand. Hence we have
today upgraded our sales growth guidance from the earlier "over 35 %" to "40-45
%". The positive margin development that we have seen in the recent quarters is
also expected to continue."
Markets
The very positive market sentiments during the first quarter 2006 prevailed
during the second quarter. The quotation activity further increased within
general manufacturing and primary metal industries and remained at good level in
container handling, shipyard, warehousing and power generation industries. The
investment activity within paper and automotive industries remained low.
Geographical market development was positive or strong in all of the Group's main
markets. Also market demand for predictive and preventive maintenance developed
well.
Orders received and order book
(Numbers in brackets are corresponding values for comparable period in 2005
unless otherwise indicated.)
Orders received excluding the value of the maintenance contract base during
January - June 2006 totalled EUR 701.9 (496.5) million boosting the total growth
to 41.4 % and the organic growth to 21.7 %. The acquisition of Stahl CraneSystems
(which is included in the numbers for six months) and the acquisition of MMH
Holdings (which is included for one month) contributed to the total growth.
KCI Konecranes recorded strong orders growth in all its Business Areas and main
markets.
3 (14)
Orders received by Business Areas, MEUR
1-6/2006 1-6/2005 Change % Organic
growth %
Maintenance 200.8 163.2 +23.2 +16.7
Services
SLEQ 307.0 156.5 +96.2 +40.6
Special Cranes 239.4 210.8 +13.6 +13.6
Internal -45.4 -33.7
Total 701.9 496.5 +41.4 +21.7
4-6/2006 4-6/2005 Change % Organic
growth %
Maintenance 104.1 84.5 +23.2 +10.7
Services
SLEQ 160.3 80.6 +98.9 +40.0
Special Cranes 124.3 131.5 -5.4 -5.4
Internal -19.5 -17.5
Total 369.2 279.0 +32.3 +11.5
Orders received during April - June reached again an all time high level for one
single quarter and totalled EUR 369.2 (279.0) million. The growth was 32.3 %
(11.5 % organic). Only Special Cranes orders during the second quarter were at a
lower level compared to the corresponding quarter of last year. In Special Cranes
one single quarter is however too short a time period to indicate any trend
change. The quotation activity in Special Cranes remained very strong.
Order book and contract base
The order book at the end of June totalled EUR 640.7 (414.7). The value of the
order book grew by 54.5 % compared to the level at the end of June 2005 and 48.3
% compared to the yearend 2005. The acquired business operations increased the
value of the order book by approx. EUR 129 million.
Order book by Business Areas, MEUR
June 2006 June 2005 Change % Dec 31 2005
Maintenance 118.7 88.2 +34.5 78.0
Services
SLEQ 192.3 86.2 +123.2 64.5
Special Cranes 377.7 254.1 +48.7 319.8
Internal -48.0 -13.8 -30.3
Total 640.7 414.7 +54.5 432.1
The order book (excluding the value of maintenance contract base) grew
significantly in all Business Areas. The positive development in the maintenance
contract base continued both in terms of units and value. At the end of June 2006
a total of 251 837 (239 665) cranes and hoists were included in the contract
base. The MMH Holdings, Inc.'s contract base is not included in these figures.
Sales
KCI Konecranes' net sales for January - June 2006 totalled EUR 636.6 (427.4)
million. The growth was 48.9 % and the organic growth 28.7 %.
4 (14)
Sales by Business Areas, MEUR
1-6/2006 1-6/2005 Change % Organic
growth %
Maintenance Services 222.3 184.9 +20.2 +15.1
SLEQ 254.2 133.6 +90.3 +33.8
Special Cranes 202.9 140.4 +44.5 +43.2
Internal -42.8 -31.5
Total 636.6 427.4 +48.9 +28.7
The acquisition of Stahl CraneSystems contributed (for six months) to the sales
growth in Standard Lifting Equipment and the acquisition of MMH Holdings (for one
month) contributed to sales in all Business Areas.
Quarterly sales by Business Areas, MEUR
4-6/2006 4-6/2005 Change % Organic
growth %
Maintenance Services 119.6 98.7 +21.2 +11.7
SLEQ 136.2 69.6 +95.7 +34.9
Special Cranes 104.5 79.1 +32.1 +29.8
Internal -20.4 -12.6
Total 339.9 234.8 +44.8 +22.0
Net sales for April - June totalled EUR 339.9 (234.8) million, up by 44.8 %
compared to the corresponding period last year. The organic growth was 22.0 %.
The percentage growth accelerated or stayed at a high level in comparison to the
first quarter growth numbers in all Business Areas even though the comparable
figures for last year were very challenging. Strong growth was recorded also in
all major markets.
Sales by Market, MEUR
1-6/2006 1-6/2005 Change %
Nordic and Eastern
Europe 120.9 95.6 26.5
EU (excl. Nordic) 211.2 139.9 50.9
Americas 195.9 115.7 69.3
Asia-Pacific 108.6 76.2 42.5
Result
Operating income for January - June 2006 was EUR 35.0 (13.9) million which is an
increase of EUR 21.1 million or 152.3 % compared to January - June 2005 (Reported
operating income for January - June 2005 was EUR 14.1 million. Operating income
last year included EUR 0.2 million positive share of associated companies'
result, which is now reported below operating income for better comparison.). The
operating income margin was 5.5 (3.2) %. During April - June 2006 operating
income was EUR 21.0 (9.0) million and the corresponding profit margin was 6.2
(3.8) %.
5 (14)
Operating income by Business Areas, MEUR
1-6/2006 % of 1-6/2005 % of
sales sales
Maintenance Services 16.6 7.5 11.5 6.2
SLEQ 24.3 9.6 10.9 8.2
Special Cranes 11.2 5.5 3.2 2.3
./. Group overheads -16.2 -2.5 -12.0 -2.8
./. elimination of
internal profit -0.9 -0.1 -0.3 -0.1
Total 35.0 5.5 13.9 3.2
4-6/2006 % of 4-6/2005 % of
sales sales
Maintenance Services 9.9 8.3 6.9 7.0
SLEQ 14.3 10.5 6.0 8.6
Special Cranes 5.6 5.4 1.9 2.4
./. Group overheads -8.8 -2.6 -6.0 -2.6
./. elimination of
internal profit -0.1 -0.9 +0.3 +0.1
Total 21.0 6.2 9.0 3.8
A clear profitability improvement continued during the second quarter in all
Business Areas. The development is mainly attributable to the strong sales
growth, improved productivity and the US dollar/euro development, which was now
somewhat more favourable compared to the situation last year. The reported
results and profitability of the acquired operations also contributed, as
expected, to higher profit.
Financial costs (net of expenses and income) were EUR 5.8 (15.0) million. The
corresponding figure for January - June 2005 included a loss arising from a
change in fair value of approx. EUR 10.9 million on derivates used for hedging
purposes. At this time last year hedge accounting on forward contracts for cash
flow hedging was not applied in Special Cranes sales projects.
The January - June income before taxes were EUR 29.5 (-0.9) million and income
before taxes during the second quarter was EUR 17.6 (-1.9) million.
Corporate income taxes for January - June totalled EUR 8.9 (+0.3) million
corresponding to a 30 percent tax rate. Second quarter taxes totalled EUR 5.3
(0.2) million.
Net income for January - June was EUR 20.7 (-0.6) million or EUR 0.36 (-0.01) per
share. Corrected for the fair value change mentioned in financial costs the more
comparable earnings per share in January - June 2005 was approx. EUR 0.10. In the
second quarter net income was EUR 12.4 (0.7) million or EUR 0.21 (0.01) per
share.
The return on capital employed for January - June 2006 was 19.6 (8.4) % and the
return on equity 25.4 (-1.0) %. Counted on a last twelve months' basis return on
capital employed was 22.6 (15.1) % and return on equity was 30.2 (10.6) %. The
higher capital return ratios are a consequence of improved profitability and
sustained efficiency in capital utilisation.
The profit accumulation in KCI Konecranes has typically been slow in the
beginning of the year and then accelerated towards the yearend. This seasonality
in earnings pattern is expected to repeat itself also during this year but it is
expected to be less pronounced compared to previous years.
6 (14)
Cash flow and balance sheet
The cash flow from operations before financing items and taxes for January - June
2006 was EUR 38.2 (24.7) million. Cash flow remained at a good level despite of
strong growth. The net cash flow from operating activities (after financing and
taxes) was EUR 26.1 (16.5) million or EUR 0.45 (0.29) per share.
Net debt totalled EUR 177.0 (116.0) million and gearing was 102.1 (91.3) %. The
Group's total equity/total assets ratio (solidity) was 24.1 (26.5) %. Taking into
account the latest acquisitions (Stahl CraneSystems and MMH Holdings), the
gearing and solidity ratio developments were at very satisfactory levels.
According to preliminary MMH Holdings, Inc.'s accounts the acquisition did not
change KCI Konecranes' structure of balance sheet in any significant manner.
Capital expenditures
In January - June 2006 the Group's capital expenditures excluding acquisitions
totalled EUR 7.7 (7.4) million. Capital expenditures including acquisitions
totalled EUR 59.0 (7.5) million.
Personnel
At the end of June 2006 KCI Konecranes had 7256 (4940) employees in total.
Personnel by Business Areas:
6/2006 6/2005 Change %
Maintenance Services 3775 2786 +35.5
Standard Lifting 2297 1178 +95.0
Equipment
Special Cranes 1015 855 +18.7
Group Staff 169 121 +39.7
Total 7256 4940 +46.9
Approximately one fourth of the growth in personnel is attributable to organic
growth and the rest to acquisitions.
Important Events
On 19 May 2006 HMM Acquisition Corp., a wholly owned Konecranes Inc. subsidiary,
acquired 59.2% of the shares of MMH Holdings, Inc., the owner of U.S. based
Morris Materials Handling, Inc. The holding was further increased on May 26 to
74.5% and on June 5 to approx. 90.9%. On June 7 HMM Acquisition Corp. had
increased its stake to 96.7% and completed a short form merger as a result of
which Konecranes, Inc. obtained 100% of MMH Holdings, Inc. shares. Morris
Material Handling, Inc. has over 120 years of history in crane industry and is a
recognised player in the maintenance service and overhead crane industry,
especially in the North-American market. The addition of MMH's product ranges
especially for the steel and power industries complements KCI Konecranes'
offering. The acquisition also brings new opportunities for growth in Maintenance
Services through the large installed base of MMH cranes. Through its subsidiaries
MMH also has local operations in Canada, Mexico and Chile. MMH Holdings, Inc was
consolidated into the KCI Konecranes Group figures as of 1 June 2006.
Operationally MMH Holdings, Inc. continues as an independent entity within the
KCI Konecranes Group.
On 18 May 2006 Mr. Hannu Rusanen was appointed President, Maintenance Services
Business Area, with effect as of September 1, 2006. In his new role, he will
assume the global responsibility for the Group's maintenance service operations,
7 (14)
including MTM (Machine Tool Maintenance). Mr. Tom Sothard, who has had two roles,
as both head of Global Maintenance Services and KCI Konecranes' Americas region,
will focus on the latter one. Mr Rusanen will also continue in his current
position as head of Nordic region.
On 22 June 2006 Mr. Pierre Boyer was appointed to a new position in KCI
Konecranes' Executive Management Team as President, Europe, Middle East & Africa
(EMEA), with effect as of 1 September 2006.
On 7 June 2006 KCI Konecranes arranged a Capital Markets Day for institutional
investors, analysts and media representatives at Group headquarters in Hyvinkää,
Finland. The day focused on presentations by all Business Area Presidents, the
Group's Chief Technology Officer and the President & CEO's presentation on the
impacts of the acquisition of US-based Morris Materials Handling, Inc. The event
gathered 27 participants.
Shares and shareholders
Change in share capital and subscription of shares with stock options
Pursuant to KCI Konecranes stock options, a total of 422 800 new KCI Konecranes
shares were recorded in the Trade Register during Q2/2006.
Following these subscriptions KCI Konecranes' share capital at the end of June
was EUR 29 756 860, and the total number of shares was 59 513 720.
Shares and trading volume
KCI Konecranes Plc's share price increased by 35.32 % during January - June and
closed at EUR 14.08. The period high was EUR 17.70 and period low EUR 10.23. The
volume weighted average share price during the period was EUR 13.74. During the
same period the OMX Helsinki Index increased by 5.52%, the OMXH25 Helsinki Index
by 6.08% and the OMX Helsinki Industrials Index by 12.84%.
At the end of June KCI Konecranes Plc's total market capitalisation was EUR 838
million including the company's own shares, the 34th largest market value of
companies listed on the Helsinki Stock Exchange.
The trading volume totaled 64,569,345 shares (adjusted with share split) of KCI
Konecranes Plc, which represents 108.50% of the company's total amount of
outstanding shares. In monetary terms trading was EUR 886 million, which was the
23rd largest trading value of companies listed on Helsinki Stock Exchange. The
daily average trading volume was 340 952 shares representing a daily average
turnover of EUR 7.15 million. As of 1 August 2006, the KCI Konecranes share was
included in the OMXH25 stock index, which is a market-value weighted share price
index. The OMXH25 index contains the twenty-five (25) most traded stock classes
in terms of their daily median trading volume expressed in euro for the preceding
calendar half-year on Helsinki Stock Exchange.
Flagging notifications
On 5 April, 2006 the holdings of Capital Group Companies, Inc. decreased to 4.90
percent of the share capital and voting rights of KCI Konecranes Plc.
The Company's own shares
At the end of June, KCI Konecranes Plc held 842 600 of the company's own shares.
This corresponds to 1.42 % of the company's total outstanding shares and votes.
The shares were bought back between February 20 and March 5, 2003.
8 (14)
Litigations
The litigation between Morris Materials Handling, Inc. and Konecranes, Inc. and
KCI Konecranes Plc was dismissed on June 8, 2006 through a joint stipulation of
the parties. The dismissal was prompted when Konecranes, Inc. became the sole
shareholder of MMH Holdings, Inc. the owner of U.S. based Morris Materials
Handling, Inc.
At the moment KCI Konecranes does not expect any ongoing litigations or cases to
have a material effect.
Future prospects
At the moment we see no signs of slowing demand. Full year sales growth is
expected to be 40-45 %.
The positive margin development is expected to continue.
Helsinki, 3 August, 2006
Board of Directors
Disclaimer
Certain statements in this report, which are not historical fact, including,
without limitation those regarding expectations for market growth and
developments, expectations for growth and profitability and statements preceded
by "believes", "expects", "anticipates", "foresees" or similar expressions, are
forward-looking statements. Therefore they involve risks and uncertainties, which
may cause actual results to materially differ from the results expressed in such
forward-looking statements. Such factors include but are not limited to the
company's own operating factors, industry conditions and general economic
conditions.
Important orders
Here are some examples on orders received during April - June 2006. The list
illustrates our reach, both in terms of customer base and geographical coverage.
Dragados S.P.L., a well-established logistics company and a domestic leader in
port handling operations in Spain, ordered 12 Rubber Tired Gantry cranes (RTG)
for their port operations in Malaga at Terminales del Sudeste.
KCI Konecranes received its first RTG order for a Ukraine from Ukrtranscontainer
who ordered six units for the Illichivsk container terminal.
The Black Sea Port giant Novorossiysk Commercial Sea Port (NCSP) ordered in total
19 units of various Forklift trucks and Reach Stackers for container handling.
Norec in Liverpool UK ordered a partial refurbishment of a Ship-to-shore
container crane where the cabin runway is to be totally replaced.
Uralskaya Stal, a new customer to KCI Konecranes and one of Russia's largest
steel companies, ordered a 210-ton casting crane for the Novotroisk steel-melting
plant in Russia.
TSW Trier ordered one 110T capacity steel mill crane equipped with 20T magnet
equipped trolley to their plant in Trier, Germany.
9 (14)
Haeusler of Switzerland ordered two steel plate storage cranes with magnetic
spreaders, two Pipe handling cranes and two Maintenance cranes for a project in
Abu Dhabi.
Vallourec Mannesman Tubes from France ordered two bar handling cranes with
magnetic spreaders to be delivered to Saint Saulve in France.
Alcoa Bohai Aluminum Industries Co. Ltd. of China ordered multiple process and
CXT cranes for their Aluminium processing plant in QinHuangDao, Hebei Province,
China.
Klabin S.A., Brasil ordered two 80T capacity SpaceMaker paper mill process cranes
and a 10T capacity CXT maintenance crane to start operation by a new paper
machine at their Monte Alegre plant in Telêmaco Borba, Brasil.
RWE Power of Germany ordered two 300T capacity paper mill process cranes and two
20T capacity maintenance cranes for their plant in Neurath, Germany.
Marubeni Corporation from Tokyo, Japan ordered three 40/10T Turbine Hall EOT
Cranes for its Simple Cycle Power Plant project in Nigeria.
KAB-Takuma ordered two waste handling cranes, two slag handling cranes and a
turbine hall crane including several CXT hoists for their Lakeside WTE project
near London's Heathrow Airport.
Bechtel LLC ordered two 54T capacity special process cranes and two 10T
SpaceMaker cranes for their Sohar Aluminium project in Oman.
Siemens of Germany ordered multiple cranes including two 300T and five 100T
capacity process cranes for their test centre in Duisburg, Germany.
Noble Drilling from Houston, TX, USA ordered three 45 Ton Gantry Cranes for use
on semi-submersible drill rigs, designed specifically for use in ultra-deep
waters.
The presented Financial information is construed according to the recognition and
measurement principles of
International Financial Reporting Standards (IFRS).
The figures presented in the tables below have been rounded to one decimal, which
should be taken into account when reading the sum figures.
The interim report has not been subject to audit.
10 (14)
CONSOLIDATED STATEMENT OF INCOME - IFRS (MEUR)
1-6/2006 1-6/2005 1-12/2005
Sales 636.6 427.4 970.8
Other operating income 0.9 1.2 2.2
Depreciation -9.9 -7.3 -15.6
Other operating expenses -592.6 -407.4 -908.1
Operating income (EBIT) 35.0 13.9 49.3
Share of result of associates
and joint ventures 0.3 0.2 0.5
Financial income and expenses -5.8 -15.0 -15.8
Income before taxes 29.5 -0.9 34.1
Taxes -8.9(1 0.3(1 -10.0
Net Income 20.7 -0.6 24.1
Earnings per share,
basic (EUR) 0.36 -0.01 0.43
Earnings per share,
diluted (EUR) 0.35 -0.01 0.42
1) According to estimated tax rate
CONSOLIDATED BALANCE SHEET - IFRS (MEUR)
6/2006 6/2005 12/2005
Non-current assets 218.3 134.0 197.6
Inventories 218.6 152.1 157.0
Receivables and other current
assets 354.5 230.6 325.4
Cash and cash equivalents 40.9 31.1 44.0
Total assets 832.3 547.8 724.0
Equity 173.3 127.1 152.1
Non-current liabilities 173.5 56.9 106.9
Provisions 20.8 15.8 20.1
Current liabilities 464.7 348.0 444.9
Total equity and liabilities 832.3 547.8 724.0
Gearing % 102.1 91.3 88.1
Solidity % 24.1 26.5 23.7
Return on capital employed %,
22.6 15.1 17.2
Last Twelve Months (LTM)
Return on equity %,
Last Twelve Months (LTM) 30.2 10.6 16.6
Equity/share, EUR 2.95 2.25 2.66
STATEMENT OF CHANGES IN SHAREHOLDERS` EQUITY (MEUR)
Share Other Other Transl. Fair Retained Min. Tot.
Cap. Restr. Reserv. Diff. value Earnings Int. Eq.
Cap. Reserv.
Equity
12/2004 28.6 22.3 0.0 -6.1 0.0 92.7 0.1 137.6
Options
exercised 0.1 0.8 0.9
Dividend
distrib. -14.8 -14.8
Share .
issue
11 (14)
Change in
untaxed
reserves -0.7 -0.7
Cash flow
hedge
Translat.
differ. 4.1 4.1
Share
based
payments
recogn.
against
equity 0.6 0.6
Net
profit
for the
period -0.6 -0.6
Equity
6/2005 28.7 23.1 0.0 -2.0 0.0 77.2 0.1 127.1
Equity
12/2005 29.0 26.5 0.0 -1.2 -4.9 102.7 0.1 152.1
Options
exercised 0.8 9.3 10.1
Dividend
distrib. -15.8 -15.8
Share 0.5 0.5
issue
Change in
untaxed
reserves 0.0 0.0
Cash flow
hedge 8.4 8.4
Translati
on -3.0 -3.0
differenc
e
Share
based
payments
recognize
d against 0.4 0.4
equity
Net
profit
for the 20.7 20.7
period
Equity
6/2006 29.8 35.8 0.5 -4.2 3.5 107.9 0.1 173.4
12 (14)
CONSOLIDATED CASH FLOW STATEMENT - IFRS (MEUR)
1-6/2006 1-6/2005 1-12/2005
Operating income before chg in net
working capital 44.8 21.3 65.8
Change in net working capital -6.6 3.4 0.7
Cash flow from operations before
financing items and taxes 38.2 24.7 66.5
Financing items and taxes -12.1 -8.2 -18.1
Net cash flow from operating activities 26.1 16.5 48.4
Net cash used in investing activities -56.8 -9.4 -46.1
Cash flow before financing activities -30.7 7.0 2.3
Net cash used in financing activities 28.5 2.4 19.7
Translation differences in cash -0.9 1.0 1.3
Change of cash and cash equivalents -3.1 10.4 23.3
Cash and cash equivalents at
beginning of period 44.0 20.7 20.7
Cash and cash equivalents at end
of period 40.9 31.1 44.0
Change of cash and cash equivalents -3.1 10.4 23.3
SEGMENT REPORTING
1. BUSINESS SEGMENTS (MEUR)
Order Intake by Business 1-6/2006 1-6/2005 LTM* 1-12/2005
Area
Maintenance Services 200.8(1 163.0 402.3 364.5
Standard Lifting Equipment 307.0 156.5 472.7 322.1
Special Cranes 239.4 210.8 492.0 463.3
./. Internal -45.4 -33.7 -100.4 -88.7
Total 701.9(1 496.5 1266.6 1061.2
1) Excl. Service Contract Base
* LTM = last 12 months (full year 2005 ./. six months 2005 + six months 2006)
Order Book total (2 6/2006 6/2005 12/2005
Total 640.7 414.7 432.1
2) Percentage of completion deducted
Sales by Business Area 1-6/2006 1-6/2005 LTM* 1-12/2005
Maintenance Services 222.3 184.9 443.9 406.5
Standard Lifting Equipment 254.2 133.6 438.6 318.0
Special Cranes 202.9 140.4 393.6 331.1
./. Internal -42.8 -31.5 -96.1 -84.8
Total 636.6 427.4 1180.0 970.8
*LTM = last 12 months (full year 2005 ./. six months 2005 + six months 2006)
Operating Income by 1-6/2006 1-6/2005 1-12/2005 LTM*
Business Area
MEUR % MEUR % MEUR % MEUR
Maintenance Services 16.6 7.5 11.5 6.2 29.4 7.2 34.5
Standard Lifting
Equipment 24.3 9.6 10.9 8.1 28.8 9.1 42.3
Special Cranes 11.2 5.5 3.2 2.3 15.2 4.6 23.1
Group costs -16.2 -12.0 -23.8 -28.0
Consolidation items -0.9 0.3 -0.3 -1.5
Total 35.0 13.9 49.3 70.5
* LTM = last 12 months (full year 2005 ./. six months 2005 + six months 2006)
13 (14)
Personnel by Business Area 6/2006 6/2005 12/2005
(at the End of the Period)
Maintenance Services 3,775 2,786 2,999
Standard Lifting Equipment 2,297 1,178 1,898
Special Cranes 1,015 855 890
Group staff 169 121 136
Total 7,256 4,940 5,923
Average number of personnel
during period 6,435 4,814 5,087
2. GEOGRAPHICAL SEGMENTS (MEUR)
Sales by Market 1-6/2006 1-6/2005 LTM* 1-12/2005
Nordic and Eastern Europe 120.9 95.6 240.4 215.1
EU (excl. Nordic) 211.2 139.9 371.8 300.5
Americas 195.9 115.7 357.9 277.7
Asia-Pacific 108.6 76.2 209.8 177.4
Total 636.6 427.4 1180.0 970.8
* LTM = last 12 months (full year 2005 ./. six months 2005 + six months 2006)
INVESTMENTS (MEUR) 1-6/2006 1-6/2005 1-12/2005
Total (excl. Acquisitions) 7.5 7.5 16.0
NET INTEREST BEARING LIABILITIES (MEUR) 6/2006 6/2005 12/2005
Long- and short-term interest bearing
liabilities -218.4 -147.6 -178.4
Cash and cash equivalents and other
interest bearing assets 41.4 31.5 44.4
Total -177.0 -116.1 -133.9
CONTINGENT LIABILITIES AND PLEDGED 6/2006 6/2005 12/2005
ASSETS
(MEUR)
Contingent Liabilities
For own debts
Mortgages on land and buildings 5.9 5.9 5.9
For own commercial obligations
Pledged assets 0.9 0.3 0.3
Guarantees 115.3 110.4 117.2
For others
Guarantees 0.0 0.1 0.0
Other contingent and financial
liabilities
Leasing liabilities 38.7 28.6 45.1
Other liabilities 0.7 1.1 0.7
Total 161.4 146.4 169.2
14 (14)
NOTIONAL AND FAIR 6/2006 6/2006 6/2005 6/2005 12/2005 12/2005
VALUES OF Nominal Fair Nominal Fair Nominal
DERIVATIVE value value value value value Fair
FINANCIAL value
INSTRUMENTS (MEUR)
Foreign exchange
forward contracts 300.5 3.7 338.6 -2.2 304.0 -8.9
Interest rate swap 0.0 0.0 25.0 0.3 0.0 0.0
Electricity
derivates 0.7 0.4 0.0 0.0 0.8 0.2
Total 301.3 4.1 363.6 -1.9 304.8 -8.7
Derivatives are used for hedging currency and interest rate risks as well as risk
of price fluctuation of electricity. Company applies hedge accounting on
derivatives used to hedge cash flows in special cranes projects.
Events on 3 August, 2006
Analyst and press briefing
A luncheon presentation for media and analysts will be held at Helsinki World
Trade Center, Marski Hall at 12.00 noon Finnish Time (address Aleksanterinkatu
17).
Live webcast
A live webcast of the presentation for analysts and media will begin at 12.00
noon Finnish Time and can be followed at www.konecranes.com/investor.
Internet
This report and graphic material is available on the Internet at
www.konecranes.com/investor immediately after publication. A recording from the
webcast presentation will be available on the Internet later on 3 August.
Next report
Interim Report, January - September 2006, will be published on 2 November, 2006.
Graphics
A graphical presentation of this report is available on the Internet at
www.konecranes.com/investor.
KCI KONECRANES PLC
Franciska Janzon
IR Manager
FURTHER INFORMATION
Mr. Pekka Lundmark, President and CEO, tel. +358-20 427 2000
Mr Teuvo Rintamäki, Chief Financial Officer, tel. +358-20 427 2040,
Ms Franciska Janzon, IR Manager, tel. +358-20 427 2043
DISTRIBUTION
Helsinki Stock Exchange
Media
KCI KONECRANES PLC
