KONECRANES PLC: JANUARY - MARCH 2008 INTERIM REPORT
KONECRANES PLC INTERIM REPORT APRIL 29, 2008 10.00 A.M.
KONECRANES PLC: JANUARY - MARCH 2008 INTERIM REPORT
- All time high orders received: 562.3 (Q1/07: 429.4) MEUR, +30.9 %
- Net sales: 439.2 (380.5) MEUR, +15.4 %
- Strong operating profit (EBIT): 45.0 (30.8) MEUR, EBIT margin: 10.2 (8.1) %
- Profit before taxes: 46.3 (27.4) MEUR
- Earnings per share: 0.57 (0.33) EUR
- 2008 Net Sales growth target raised to approximately 15% assuming currencies
remain at the current levels through 2008.
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| | First quarter | R12 MTH | |
--------------------------------------------------------------------------------
| EUR million | 1-3/ | 1-3/ | Change | 4/07-3/08 | 1-12/ |
| | 2008 | 2007 | % | * | 2007* |
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| Orders received | 562.3 | 429.4 | 30.9 | 2,004.8 | 1,872.0 |
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| Order Book at end of | 909.7 | 636.8 | 42.9 | | 757.9 |
| period | | | | | |
--------------------------------------------------------------------------------
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| Sales total | 439.2 | 380.5 | 15.4 | 1,808.4 | 1,749.7 |
--------------------------------------------------------------------------------
| Operating profit | 45.0 | 30.8 | 45.8 | 188.9 | 174.7 |
| (EBIT) | | | | | |
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| EBIT margin, % | 10.2 | 8.1 | | 10.4 | 10.0 |
--------------------------------------------------------------------------------
| Share of result of | 0.2 | -0.2 | | 1.1 | 0.7 |
| associates | | | | | |
| and joint ventures | | | | | |
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| Interests, net | -1.3 | -2.6 | | -7.2 | -8.5 |
--------------------------------------------------------------------------------
| Other financial | 2.4 | -0.6 | | -2.7 | -5.7 |
| income and expenses | | | | | |
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| Profit before taxes | 46.3 | 27.4 | 68.8 | 197.7 | 178.8 |
--------------------------------------------------------------------------------
| Taxes | -13.0 | -8.0 | | -54.6 | -49.6 |
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| Net profit for the | 33.3 | 19.5 | 71.1 | 143.0 | 129.2 |
| period | | | | | |
--------------------------------------------------------------------------------
| Earnings per share, | 0.57 | 0.33 | 73.8 | 2.41 | 2.17 |
| basic (EUR) | | | | | |
--------------------------------------------------------------------------------
| Earnings per share, | 0.56 | 0.32 | 75.2 | 2.38 | 2.13 |
| diluted (EUR) | | | | | |
--------------------------------------------------------------------------------
| Gearing % | 26.3 | 65.0 | | | 7.0 |
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| Return on capital | | | | 51.0 | 50.4 |
| employed %, Rolling | | | | | |
| 12 Months (R12M) | | | | | |
--------------------------------------------------------------------------------
| Average number of | 8,625 | 7,677 | 12.3 | | 8,005 |
| personnel during the | | | | | |
| period | | | | | |
--------------------------------------------------------------------------------
* The EBIT and EBIT margin is presented excluding the EUR 17.6 million capital
gain booked in Q2 2007, while other figures include the capital gain.
President and CEO Pekka Lundmark's comments on Q1 2008 performance:
"The fact that we are able to report all-time high order intake is encouraging.
The 31 % growth demonstrates our strength on the market place especially when
the general economic uncertainty has further increased and the unfavorable
exchange rate development lowers our reported euro growth by six percentage
points. The strong first quarter orders have led us to raise our full year sales
growth target to approximately 15 %.
In spite of the increasing raw material prices and unfavorable exchange rates
our operating margin increased by more than two percentage points, to 10.2 %,
compared to the first quarter 2007. This shows that our target to continue to
improve our full year operating margin from previous year's 10 % is fully
realistic."
Summary of Konecranes' financial performance in the first quarter of 2008.
Demand remained strong in all Business Areas. Group orders received increased
30.9 percent (+36.9 percent in comparable currency rates*) to all time high EUR
562.3 (429.4) million, boosted by a very strong quarter in Heavy Lifting, and
continued high growth in Standard Lifting. The increase in orders for process
cranes in the Americas, and large port orders in the Europe, Middle East, Africa
(EMEA) region boosted order intake in Heavy Lifting. Standard Lifting achieved
very strong order growth in EMEA, and in the Asia-Pacific (APAC) region in
particular, while orders in the Americas were roughly unchanged at a high level.
In Service, reduced modernization orders and changes in currency rates
suppressed order growth. However, in comparable currency rates Service orders
growth continued. Higher prices stood for approximately five percentage points
of the 36.9 percent order growth in comparable currency rates.
Higher sales in all Business Areas resulted in Group net sales growth of 15.4
percent (+20.7 percent in comparable currency rates) to EUR 439.2 (380.5)
million. Standard and Heavy Lifting achieved strong sales growth as production
capacity has been continuously raised in response to the increasing order
intake. Service sales showed low growth as a result of currency changes and
lower modernization sales. Higher prices accounted for roughly five percentage
points of 20.7 percent sales growth in comparable currency rates.
Group operating profit rose to EUR 45.0 (30.8) million, boosted by higher
volumes, and the improved EBIT margin in Service and Standard Lifting. Changes
in currencies had a negative EBIT margin impact of approximately one percentage
point. The Group EBIT margin rose to 10.2 (8.1) percent despite the lower EBIT
margin in Heavy Lifting.
Cash flow from operations before financing items and taxes amounted to EUR 22.1
(34.5) million. Net Working capital increased by EUR 32.7 million from the low
level at the end of 2007.
Net debt increased to EUR 68.9 (end-2007: 19.7) million after the dividend
payment of EUR 46.8 million. Gearing increased to 26.3 (end-2007: 7.0) percent.
* The growth at comparable currency rates has been reached by re-calculated the
comparison period figures with the Q1 2008 currency rates.
Interim Report January-March 2008
Change in Reporting Method
In order to increase the transparency of the reported Business Area performance,
all the services and spare parts business will be reported in the Service
Business Area as of January 1, 2008.
Due to this change, the Business Area figures for 2007 have been restated for
better comparability. The restated figures differ from the reported figures for
all three Business Areas, while the Group and regional figures are unchanged.
The main change in the reporting method is that the non-Konecranes branded spare
parts business is included in the Service Business Area, where previously it was
reported in Standard and Heavy Lifting. The spare part business for
Konecranes-branded products was included in the Service Business Area as of
2007. The 2007 comparison figures according to the new reporting structure are
presented in the table below.
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| | Restate | Restate | Restate | Restated | Restated | Reported |
| | d | d | d | | | |
--------------------------------------------------------------------------------
| | Q1/07 | Q2/07* | Q3/07 | Q4/07 | 2007* | 2007* |
--------------------------------------------------------------------------------
| Service | | | | | | |
--------------------------------------------------------------------------------
| Orders | 159.0 | 157.2 | 154.8 | 152.4 | 623.4 | 563.0 |
| Received, | | | | | | |
| MEUR | | | | | | |
--------------------------------------------------------------------------------
| Net Sales, | 163.2 | 166.7 | 173.2 | 189.1 | 692.2 | 628.6 |
| MEUR | | | | | | |
--------------------------------------------------------------------------------
| Operating | 18.5 | 21.1 | 24.7 | 27.6 | 91.9 | 78.7 |
| Profit, MEUR | | | | | | |
--------------------------------------------------------------------------------
| Operating | 11.3 | 12.7 | 14.3 | 14.6 | 13.3 | 12.5 |
| Margin, % | | | | | | |
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| Standard | | | | | | |
| Lifting | | | | | | |
--------------------------------------------------------------------------------
| Orders | 183.4 | 187.5 | 188.2 | 184.2 | 743.3 | 793.8 |
| Received, | | | | | | |
| MEUR | | | | | | |
--------------------------------------------------------------------------------
| Net Sales, | 131.8 | 156.8 | 163.4 | 186.9 | 638.9 | 692.6 |
| MEUR | | | | | | |
--------------------------------------------------------------------------------
| Operating | 14.3 | 21.9 | 25.1 | 29.0 | 90.4 | 101.2 |
| Profit, MEUR | | | | | | |
--------------------------------------------------------------------------------
| Operating | 10.9 | 14.0 | 15.4 | 15.5 | 14.2 | 14.6 |
| Margin, % | | | | | | |
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| Heavy Lifting | | | | | | |
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| Orders | 114.9 | 148.4 | 191.8 | 165.3 | 620.4 | 633.9 |
| Received, | | | | | | |
| MEUR | | | | | | |
--------------------------------------------------------------------------------
| Net Sales, | 110.6 | 125.8 | 115.0 | 184.4 | 535.7 | 549.0 |
| MEUR | | | | | | |
--------------------------------------------------------------------------------
| Operating | 7.3 | 5.5 | 3.8 | 15.0 | 31.6 | 34.0 |
| Profit, MEUR | | | | | | |
--------------------------------------------------------------------------------
| Operating | 6.6 | 4.4 | 3.3 | 8.1 | 5.9 | 6.2 |
| Margin, % | | | | | | |
--------------------------------------------------------------------------------
*Operating profit (EBIT) and margin excluding EUR 17.6 million capital gain
booked in Q2 2007.
Group Structure
In the first quarter of 2008, Konecranes made four acquisitions. The business of
the machine tool service company Eiker Automasjon AS in Norway was acquired in
January, and the ownership in industrial crane and service company Eydimen 2000
S.L. in Spain was raised to 100 percent from 19 percent in March. In the
beginning of March Konecranes raised its ownership in the Finnish company
Nostininnovaatiot Oy to 80 percent from 17 percent. Konecranes also increased
its shareholding in the joint venture company Meiden Hoist System Company in
Japan from 49 to 65 percent. Meiden was consolidated on March 31, 2008,
affecting only the first quarter balance sheet, not Group sales or profits. The
Meiden personnel of 68 employees has been included in the Standard Lifting
personnel at the end of March, 2008. Meiden is estimated to contribute
approximately EUR 15 million in net sales in the last three quarters of 2008.
The net sales of businesses acquired after the first quarter of 2007, and which
are not included in the comparison figure for 2007, accounted for approximately
one percentage point (non-organic growth) of Group sales growth.
Market Review
Overall market demand for Konecranes' products and services continued strong in
the first quarter of 2008. Industrial production continued to increase at a very
fast pace in the Asia-Pacific region (APAC), and at a moderate rate in EMEA
(Europe, Middle East & Africa) and the Americas, which resulted in good
investment demand in most industry segments.
Strong demand for process cranes and port equipment in Russia and Eastern
Europe, and growing demand in the Middle East, contributed to the overall strong
demand in the EMEA region. The demand for standard lifting equipment also
improved in EMEA. In the Americas region, demand for process cranes improved,
while demand for standard lifting equipment stabilized at a high level, and
demand for port equipment remained at a relatively low level. Demand in APAC
continued to improve, both in lifting equipment and services. Globally,
investment activity was especially strong in the steel and other metals, power,
waste-to-energy, shipbuilding and petrochemicals industries. Demand for lifting
equipment remained low in the paper and automotive industries.
Higher input costs, especially steel and labor, led to upward pressure on the
market prices for equipment and services.
GROUP
Orders Received, Order Book and Contract Base
Order intake amounted to EUR 562.3 (Q1 2007: 429.4) million, representing growth
of 30.9 percent (+36.9 percent in comparable currency rates). Service orders
decreased 1.8 percent, Standard Lifting orders rose 21.2 percent and Heavy
Lifting orders increased 84.7 percent. In comparable currency rates, order
intake improved in all regions and Business Areas. Higher prices accounted for
approximately five percentage points of the order growth in comparable currency
rates.
Order intake growth was excellent in EMEA, boosted by Heavy Lifting and
particularly port orders. Good export activity among general manufacturing
customers in Western Europe also supported EMEA order intake. Order growth in
the Americas was moderate, but in comparable currency rates it was very good,
boosted by process crane orders. Order growth in the Asia-Pacific region was
excellent due to strong development in Standard Lifting.
The value of the order backlog at the end of March was EUR 909.7 (end of March
2007: 636.8) million, up by 42.9 percent year-on-year and 20.0 percent from the
end of 2007.
Sales
Net sales rose to EUR 439.2 (380.5) million, representing growth of 15.4 percent
(20.7 percent in comparable currency rates). Service sales increased 1.8
percent, but nearly nine percent in comparable currency rates. Standard Lifting
sales rose 27.7 percent and Heavy Lifting sales increased 21.4 percent. Higher
prices accounted for approximately five percentage points of the Group sales
growth in comparable currency rates.
EMEA posted the strongest sales growth, with Heavy Lifting especially boosting
growth. In the Americas, all Business Areas posted sales growth in comparable
currency rates, but as a result of the weaker US dollar, reported sales declined
slightly. Standard Lifting was the main contributor to the strong sales growth
in APAC.
Net Sales by Region, MEUR
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| | Q1 | Q1 | Change | Change % | R12M | 2007 | Change |
| | 2008 | 2007 | percent | in | | | percen |
| | | | | comparabl | | | t |
| | | | | e | | | |
| | | | | currency | | | |
| | | | | rates | | | |
--------------------------------------------------------------------------------
| EMEA | 243.3 | 188.2 | 29.3 | 31.9 | 1,006.6 | 951.4 | 5.8 |
--------------------------------------------------------------------------------
| AME | 144.3 | 151.7 | -4.8 | 3.2 | 582.4 | 589.7 | -1.2 |
--------------------------------------------------------------------------------
| APAC | 51.5 | 40.7 | 26.6 | 30.0 | 219.4 | 208.6 | 5.2 |
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| Total | 439.2 | 380.5 | 15.4 | 20.7 | 1,808.4 | 1,749.7 | 3.4 |
--------------------------------------------------------------------------------
Profitability
The Group's operating profit (EBIT) increased to EUR 45.0 (30.8) million and the
operating margin rose to 10.2 (8.1) percent. Higher volumes, and the improved
profitability in Service and Standard Lifting were the main drivers of the
increase in operating profit. The changes in currency rates had a negative
impact of approximately one percentage point on the operating profit margin. The
weaker profitability development in Heavy Lifting had a negative impact on EBIT
growth and the Group EBIT margin.
Unallocated Group overhead costs were EUR 11.0 (8.5) million, representing 2.5
(2.2) percent of net sales. The increase in Group overhead costs of EUR 2.5
million from the first quarter of 2007 includes approximately EUR 1.0 million in
costs of non-recurring nature. Group overhead costs consist mainly of common
development costs (personnel, R&D, systems, marketing), treasury and legal
functions, development of the company structure (M&A), and Group management and
administration.
Group EBITDA was EUR 51.1 (37.0) million or 11.6 (9.7) percent of net sales.
Depreciations were unchanged at EUR 6.2 million.
The share of profit from associated companies amounted to EUR 0.2 (-0.2)
million.
Group interest costs (the net of interest income and expenses) were EUR 1.3
(2.6) million.
Group profit before taxes was EUR 46.3 (27.4) million. Income taxes were EUR
13.0 (8.0) million, corresponding to an effective tax rate of 28 (2007: 28)
percent for the year.
Group net profit was EUR 33.3 (19.5) million. Basic earnings per share totaled
EUR 0.57 (0.33) and diluted earnings per share were EUR 0.56 (0.32).
The Group's annualized return on capital employed was 51.2 (Q1/2007: 29.9)
percent and return on equity was 49.1 (Q1/2007: 35.3) percent. On a rolling
twelve-month basis, return on capital employed was 51.0 (2007: 50.4) and return
on equity 59.6 (2007: 51.2).
Cash flow and balance sheet
Cash flow from operations before financing items and taxes, but after the change
in working capital, was EUR 22.1 (34.5) million, representing EUR 0.38 (0.58)
per share. Net working capital increased by EUR 32.7 million to EUR 199.1
million from the end of 2007 as a result of higher inventories and work in
progress. Compared with the end of March 2007, net working capital decreased by
EUR 23.5 million.
Cash flow from financing items and taxes was EUR -14.1 (-12.2) million. Net cash
flow from operating activities was EUR 8.0 (22.3) million, representing EUR 0.14
(0.38) per share.
In total, EUR 5.2 (12.0) million of cash was used to cover capital expenditures
including acquisitions. The cash-based capital expenditures in fixed assets were
EUR 2.6 (6.8) million.
The Group's capital expenditures excluding acquisitions were EUR 3.1 (5.4)
million. These capital expenditures consisted mainly of replacement or capacity
expansion investments on machines, equipment and information technology. Capital
expenditures in acquisitions were EUR 2.7 (5.4) million.
The parent company paid EUR 46.8 (26.8) million in dividends.
Group interest-bearing debt was EUR 130.5 (204.5) million, and interest-bearing
net debt was EUR 68.9 (141.8) million. Gearing was 26.3 (65.0) percent. The
solidity (equity) ratio was 32.1 (27.1) percent and the current ratio was 1.3
(1.3).
The Group has a EUR 200 million committed back-up financing facility to secure
running liquidity. At the end of the first quarter, EUR 25.3 (year-end 2007:
27.2) million was in use.
Service
The service Business Area developed favorably in the first quarter of 2008.
Order and sales growth in comparable currency rates was stable, and
profitability improved substantially on better pricing and higher productivity.
Order intake decreased slightly to EUR 156.1 (159.0) million. In comparable
currency rates, order growth was 4.2 percent. In addition to the changes in
currency rates, lower modernization orders suppressed order growth. Good order
intake growth continued in crane maintenance operations.
The contract base developed favorably, but changes in currencies had a negative
impact on the value of the contract base. At the end of March 2008, there were
323,644 (270,406) units included in the annual maintenance contract base. This
includes approximately 16 000 units in Germany with an annual value of EUR 2.8
million that were not reported in the contract base earlier. The increase in
number of units in the contract base excluding the previously not reported units
was approximately 15.000 from the end of 2007 and 38.000 from the end of March
2007. The annual value of the contract base increased to EUR 109 million from
106 million at the end of 2007 including the EUR 2.8 million in previously not
reported contracts. In comparable currency rates and excluding the EUR 2.8
million previously not reported, the value of the contract base increased by 3.9
percent from the end of 2007.
Sales rose to EUR 166.1 (163.2) million, representing 1.8 percent growth (8.7
percent in comparable currency rates). Sales growth was stable across all
regions.
The operating profit in Service rose to EUR 22.2 (18.5) million, and the EBIT
margin improved to 13.4 from 11.3 percent. Pricing and improved productivity
were the main drivers of the EBIT increase.
The shortage of technicians was reduced somewhat, and at end of the first
quarter the number of operatives had increased to approximately 3,400 from 3,200
at the end of 2007 and 2,950 at the end of March 2007.
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| Service | Q1 2008 | Q1 2007 | Change | R12M | 2007 | Change |
| | | | percent | | | percent |
--------------------------------------------------------------------------------
| Orders, MEUR | 156.1 | 159.0 | -1.8 | 620.5 | 623.4 | -0.5 |
--------------------------------------------------------------------------------
| Order book, | 121.8 | 112.9 | 7.8 | | 109.3 | |
| MEUR | | | | | | |
--------------------------------------------------------------------------------
| Sales, MEUR | 166.1 | 163.2 | 1.8 | 695.1 | 692.2 | 0.4 |
--------------------------------------------------------------------------------
| EBIT, MEUR | 22.2 | 18.5 | 20.5 | 95.7 | 91.9 | 4.1 |
--------------------------------------------------------------------------------
| EBIT margin, | 13.4 | 11.3 | | 13.8 | 13.3 | |
| % | | | | | | |
--------------------------------------------------------------------------------
| Personnel | 4,885 | 4,128 | 18.3 | | 4,436 | |
--------------------------------------------------------------------------------
Standard Lifting
Standard Lifting enjoyed excellent order, sales and profitability growth in the
first quarter of 2008.
Order intake grew 21.2 percent to EUR 222.2 (183.4) million. APAC achieved the
strongest order growth. Also orders in EMEA increased substantially, while
orders in the Americas were roughly unchanged at a high level in comparable
currency rates. The Standard Lifting order book increased to EUR 338.4 million
compared with 270.9 at the end of 2007, as a result of order intake exceeding
output. The order book represents slightly more than five months of sales.
Sales rose 27.7 percent to EUR 168.3 (131.8) million due to the increase in
production and deliveries. Sales decreased quarter-on-quarter from the
record-high level in Q4 2007 mainly due to a lower proportion of industrial
cranes sales versus component sales, and the timing of deliveries.
Standard Lifting's operating profit increased to EUR 26.8 (14.3) million and the
EBIT margin rose to 15.9 from 10.9 percent. Standard Lifting's first quarter
product mix was favorable in terms of EBIT margin as components accounted for a
higher proportion of sales compared with the product mix in first quarter in
2007 and in the order book. The change in product mix in coming quarters will
have a negative impact of approximately one percentage point on the EBIT margin.
The stronger euro had a negative impact on profitability. The currency hedging
rates for the second and third quarter, and the expected fourth quarter hedging
rate will also impact profitability negatively.
--------------------------------------------------------------------------------
| Standard | Q1 2008 | Q1 2007 | Change | R12M | 2007 | Change |
| Lifting | | | percent | | | percent |
--------------------------------------------------------------------------------
| Orders, MEUR | 222.2 | 183.4 | 21.2 | 782.1 | 743.3 | 5.2 |
--------------------------------------------------------------------------------
| Order book, | 338.4 | 211.0 | 60.4 | | 270.9 | |
| MEUR | | | | | | |
--------------------------------------------------------------------------------
| Sales, MEUR | 168.3 | 131.8 | 27.7 | 675.4 | 638.9 | 5.7 |
--------------------------------------------------------------------------------
| EBIT, MEUR | 26.8 | 14.3 | 87.0 | 102.9 | 90.4 | 13.8 |
--------------------------------------------------------------------------------
| EBIT margin, | 15.9 | 10.9 | | 15.2 | 14.2 | |
| % | | | | | | |
--------------------------------------------------------------------------------
| Personnel | 2,471 | 2,321 | 6.5 | | 2,479 | |
--------------------------------------------------------------------------------
Heavy Lifting
Heavy Lifting posted exceptionally strong order intake and very good sales
growth, but the profitability remained below targets.
Order intake grew 84.7 percent to EUR 212.2 (114.9) million. Port equipment in
the EMEA region accounted for a high proportion of the order intake. Process
crane orders showed strong growth in the Americas, and continued at a good level
in EMEA. The lead-time in Heavy Lifting is on average 10-14 months. Heavy
Lifting's order book increased substantially to EUR 476.5 million from EUR 406.1
million at the end of 2007 due to the record-high order intake.
Sales rose 21.4 percent to EUR 134.2 (110.6) million. Sales growth was fairly
evenly divided between port equipment and process cranes, as well as across the
three geographical regions.
In Heavy Lifting, operating profit increased to EUR 7.7 (7.3) million, but the
EBIT margin decreased to 5.8 (6.6) percent. The recent difficulties in procuring
subcontracted components eased slightly in the first quarter, but still burdened
Heavy Lifting's profitability. First quarter deliveries also included some lower
margin process crane projects. Return on capital continued at a very good level.
--------------------------------------------------------------------------------
| Heavy Lifting | Q1 2008 | Q1 2007 | Change | R12M | 2007 | Change |
| | | | percen | | | percent |
| | | | t | | | |
--------------------------------------------------------------------------------
| Orders, MEUR | 212.2 | 114.9 | 84.7 | 717.7 | 620.4 | 15.7 |
--------------------------------------------------------------------------------
| Order book, | 476.5 | 336.0 | 41.8 | | 406.1 | |
| MEUR | | | | | | |
--------------------------------------------------------------------------------
| Sales, MEUR | 134.2 | 110.6 | 21.4 | 559.3 | 535.7 | 4.4 |
--------------------------------------------------------------------------------
| EBIT, MEUR | 7.7 | 7.3 | 6.1 | 32.1 | 31.6 | 1.4 |
--------------------------------------------------------------------------------
| EBIT margin, % | 5.8 | 6.6 | | 5.7 | 5.9 | |
--------------------------------------------------------------------------------
| Personnel | 1,296 | 1,173 | 10.5 | | 1,272 | |
--------------------------------------------------------------------------------
Personnel and personnel development
At the end of March, the Group employed 8,845 (7,805) persons. The average
number of personnel was 8.625 (7,677) in the first quarter of 2008. Since the
end of 2007, the number of employees increased by 441, of which 374 in Service.
The Meiden personnel of 68 employees have been included in the Standard Lifting
personnel at the end of March, 2008.
Change in Management
Pekka Lettijeff was appointed Chief Procurement Officer (CPO) as of January 21,
2008. His areas of responsibility include all direct and indirect purchasing
across the Konecranes Group. Mr Lettijeff is a member of the Konecranes Group
Executive Board and reports to Pekka Lundmark, President & CEO.
Near-term Risks
Konecranes' customers operate in many different industries and geographical
segments that are at different stages of the economic cycle. A general global
economic downturn could reduce the demand for Konecranes' products and services.
Currency exchange rates imply risks to reported orders, sales and operating
profit. The main currency risk is the USD against the euro. A one-percent
depreciation of the USD against the euro has a negative annual EBIT impact of
approximately EUR 1.2 million, excluding the effect of currency hedging.
The substantial increase in the cost of steel creates a risk regarding
profitability, as the higher costs require price increases in order to maintain
profitability.
Incentive Programs and Share Capital
Konecranes had five ongoing stock option plans (1997, 1999, 2001, 2003 and 2007)
during the first quarter of 2008. The subscription period for the 1999B and
2003B options ended on 31 March, 2008. In total, 800,000 new shares were
subscribed under the 2003B program, which increased Konecranes' share capital by
EUR 275,600, and 416,000 new shares were subscribed under the 1999B program,
which increased Konecranes share capital by EUR 155,400. The ongoing option
plans (1997, 2001, 2003 and 2007) include more than 230 key employees. The terms
and conditions of the stock option programs are available on Konecranes' website
at www.konecranes.com.
Pursuant to Konecranes' stock option plans 68,640 new shares were subscribed for
and registered in the Finnish Trade Register during year the first quarter of
2008. As a result of these subscriptions, the number of Konecranes shares
increased to 61,047,420 shares. In April 2008, 102,600 new shares were
subscribed for and registered in the Finnish Trade Register, raising the number
of shares to 61,150,020 on April 14, 2008.
The remaining stock options at the end of the accounting period entitle to
subscription of a total of 1,980,300 shares, and the stock options remaining
after the subscriptions made in April entitle to subscription of a total of
1,877,700 shares.
The average number of shares in the first quarter of 2008 was 58,469,652
excluding own shares in the company's possession.
Repurchase of Konecranes shares and shares in the company's possession
On the basis of the authorization of the 2007 AGM, Konecranes Board of Directors
decided to commence repurchasing shares at the earliest on 8 November, 2007.
Between November 8, 2007 and January 4, 2008 Konecranes repurchased 1,800,000
for EUR 47.6 million, of which EUR 1.6 million was used in 2008. At the end of
March, 2008, Konecranes held 2,542,600 of the company's own shares. This
corresponds to 4.2 percent of the company's total outstanding shares and votes.
Resolutions of Konecranes' Annual General Meeting
Konecranes Annual General Meeting held on 13 March, 2008 approved the company's
Financial Statements for the fiscal year 2007 and discharged the Board and
Managing Director from liability.
The AGM adopted the Board's proposal that dividend of EUR 0.80 be paid on
58,496,180 shares, totalling EUR 46,796,944.00. Konecranes has 2,542,600 own
shares in its possession, which are not entitled to dividend. The rest of the
non-restricted equity of EUR 8,327,024.87 was retained and carried forward. The
dividend was paid on 28 March, 2008.
The AGM approved the proposal of the Nomination and Compensation Committee that
seven of the eight members of the Board of Directors be re-elected. Mr. Stig
Stendahl had informed that he was not available for re-election. Mr. Mikael
Silvennoinen was elected as a new member. The Board of Directors elected in the
AGM in 2008 comprises Mr. Svante Adde, Mr. Stig Gustavson, Mr. Matti Kavetvuo,
Ms. Malin Persson, Mr. Timo Poranen, Mr. Björn Savén, Mr. Kim Gran and Mr.
Mikael Silvennoinen. The term of the Board ends at the next AGM.
The AGM confirmed an annual fee of EUR 100,000 for the Chairman of the Board,
EUR 64,000 for the Vice Chairman of the Board, and EUR 40,000 for other Board
members and that 40 % of the annual fee will be used to acquire Konecranes Plc
shares from the market to each Board member. Should the acquisition of shares
not be possible due to reasons consequent upon the Company or Board member, the
compensation will be paid in its entirety in cash. In addition, compensation of
EUR 1,500 was approved for attendance at Board Committee meetings. Travel
expenses are compensated against invoice.
The AGM confirmed that Ernst & Young Oy continue as the Company's external
auditors.
The Board of Directors elected Stig Gustavson to continue as Chairman, and Björn
Savén to continue as Vice Chairman. Svante Adde was elected Chairman of the
Audit Committee, and Matti Kavetvuo, Kim Gran and Mikael Silvennoinen as
Committee members. Björn Savén was elected Chairman of the Nomination and
Compensation, and Stig Gustavson, Timo Poranen and Malin Persson were elected
Committee members.
Board Authorizations
The AGM authorized the Board to repurchase the Company's own shares. No more
than 6,097,878 shares may be repurchased. The Company cannot at any moment own
more shares than the amount of shares, which together with shares held by its
subsidiaries corresponds to 10 percent of all the registered shares of the
Company.
The Board resolves upon the methods of the repurchase and other provisions.
Among others, derivatives can be used in the purchase. The shares can be
purchased in deviation from the proportioned holdings of the shareholders
(directed purchase).
The AGM authorized the Board to transfer shares repurchased by the Company. The
authorization is limited to a maximum of 6,097,878 shares. The shares may be
transferred in one or several tranches. The Board is authorized to resolve upon
the terms and conditions of the transfer of the own shares. The Board is
authorized to resolve to transfer the shares deviating from the shareholders'
pre-emptive rights to acquire the Company's shares, provided that weighty
financial grounds exist. The Board can use this authorization to grant stock
option rights and other special rights concerning the Company's own shares,
referred to in Chapter 10 of the Companies Act but not, however, to resolve upon
a personnel stock option plan.
The AGM authorized the Board of Directors to resolve upon share issue as well as
upon issue of stock option rights, convertible bonds and other special rights
entitling to shares referred to in Chapter 10 Section 1 of the Companies Act as
follows.
Shared issued on the basis of the authorization are new shares of the Company.
The authorization is limited to issuance of a maximum of 12,195,756 shares.
On the basis of the authorization, the Board of Directors may also resolve upon
issuance of new shares to the Company itself. The Company cannot, however, at
any moment together with its subsidiaries own more than 10 percent of all the
registered shares of the Company. The shares issued may then, among other
things, be transferred on the basis of the authorization granted for the Board
of Directors to transfer the company's own shares.
The Board of Directors is authorized to resolve upon all the terms and
conditions of the share issue and the issuance of special rights entitling to
shares. The shares and the special rights entitling to shares may be issued with
deviation from the shareholders' pre-emptive right, provided that weighty
financial grounds exist for this. The authorization does not, however, concern
resolving upon a personnel stock option plan.
This authorization shall be effective until the next Annual General Meeting of
Shareholders, however no longer than until 12 September 2009.
Partial change of the 1997, 1999 and 2001 stock option program
The AGM approved the Board of Directors' proposal that Section 5 of the terms of
share subscription in the stock option programs 1997, 1999 and 2001 approved by
the General Meeting of Shareholders on 4 March 1997, 11 March 1999 and 8 March
2001 respectively, concerning shareholders' rights, are amended to read as
follows: “The right to dividend pertaining to the shares and other shareholders'
rights shall commence on the date when the new shares are registered with the
Trade Register."
Shares and trading volume
Konecranes' share price increased by 3.5 percent during the first quarter of
2008 and closed at EUR 24.40. The period high was EUR 25.87 and period low EUR
15.56. The volume-weighted average share price during the period was EUR 21.90.
In the same period, the OMX Helsinki Index deceased by 15.9 percent and the OMX
Helsinki Industrials Index decreased by 3.9 percent.
At the end of March 2007, Konecranes' total market capitalization was EUR 1,490
million including own shares in the company's possession, making it the 23rd
largest company on the Nordic Exchange Helsinki.
The trading volume totaled 57.0 (32.1) million shares, representing an
annualized turnover velocity of 375 (207) percent on the total number of
outstanding shares. Total trading amounted to EUR 1,247 (781) million, which was
the 14th highest on the OMX Nordic Exchanges Helsinki. The daily average trading
volume was 919,708 (502,307) shares, representing a daily average turnover of
EUR 20.1 (12.2) million.
Flagging notifications
Barclay Global Investors UK Holdings Ltd informed Konecranes that its ownership
in Konecranes had exceeded five percent of the share capital and voting rights
on February 28, 2008. The total number of shares owned by the group totaled
3,444,786, representing 5.64 percent of the shares and votes in Konecranes.
Events after the period under review
In mid April 2008, Konecranes acquired the Spanish company Ausió Sistemas de
Elevación S.L. The company specializes in manufacturing, sales and service of
industrial cranes and hoists. Konecranes acquired the company from its owner,
who will continue as General Manager in the company. The company has some 100
employees and net sales of EUR 17 million. In April 2008, Konecranes also signed
an agreement to acquire the Ukrainian service company Craneservice Ukraine. The
company has 140 employees and annual sales of over EUR five million.
Headquartered in Odessa, Craneservice Ukraine operates in the major ports of
Ukraine, such as Mariupol, Iljichevsk and Odessa, in practice serving and
modernizing all crane brands in the region.
Future prospects
Based on the level of new enquiries for cranes and services on Konecranes key
markets, the demand is expected to remain strong. However, it is likely that the
Heavy Lifting order intake will not continue on the exceptionally high Q1 level.
Changes in the macroeconomic environment could have an effect on the business.
Derived from scheduled deliveries and the current demand outlook for the rest of
2008, Konecranes targets 2008 Net Sales to increase by approximately 15 percent
assuming currencies remain at the current levels through 2008. In comparable
currency rates, net sales are targeted to increase slightly over 20 percent. The
Group EBIT margin is targeted to exceed the comparable level of 10.0 percent
(excluding capital gain) achieved in 2007, in spite of cost inflation and the
unfavorable exchange rate development. The previous targets given in the 2007
Financial Statements were double-digit sales growth, an opportunity to improve
EBIT margin from 10.0 percent. The Group's long-term over-the-cycle margin
target is 10 percent.
The EBIT margin in Heavy Lifting in the coming quarters is targeted to improve
compared with the first quarter. The 2008 Heavy Lifting EBIT margin is targeted
to exceed the 5.9 percent achieved in 2007.
Konecranes Plc
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.
--------------------------------------------------------------------------------
| CONSOLIDATED STATEMENT OF INCOME - IFRS | | | |
--------------------------------------------------------------------------------
| EUR million | 1-3/2008 | 1-3/2007 | Change | 1-12/2007 |
--------------------------------------------------------------------------------
| | | | % | |
--------------------------------------------------------------------------------
| Sales | 439.2 | 380.5 | 15.4 | 1 749.7 |
--------------------------------------------------------------------------------
| Other operating income | 0.6 | 0.7 | | 20.3 |
--------------------------------------------------------------------------------
| Depreciation and impairments | -6.2 | -6.2 | | -24.6 |
--------------------------------------------------------------------------------
| Other operating expenses | -388.7 | -344.3 | | -1 553.1 |
--------------------------------------------------------------------------------
| Operating profit | 45.0 | 30.8 | 45.8 | 192.3 |
--------------------------------------------------------------------------------
| Share of result of associates | 0.2 | -0.2 | | 0.7 |
| and joint ventures | | | | |
--------------------------------------------------------------------------------
| Financial income and expenses | 1.1 | -3.2 | | -14.3 |
--------------------------------------------------------------------------------
| Profit before taxes | 46.3 | 27.4 | 68.8 | 178.8 |
--------------------------------------------------------------------------------
| Taxes | -13.0 | -8.0 | | -49.6 |
--------------------------------------------------------------------------------
| Net profit for the period | 33.3 | 19.5 | 71.1 | 129.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net profit for the period | | | | |
| attributable to : | | | | |
--------------------------------------------------------------------------------
| Shareholders of the parent | 33.3 | 19.5 | | 129.2 |
| company | | | | |
--------------------------------------------------------------------------------
| Minority interest | 0.0 | 0.0 | | 0.0 |
--------------------------------------------------------------------------------
| Earnings per share, basic | 0.57 | 0.33 | 73.8 | 2.17 |
| (EUR) | | | | |
--------------------------------------------------------------------------------
| Earnings per share, diluted | 0.56 | 0.32 | 75.2 | 2.13 |
| (EUR) | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED BALANCE SHEET - IFRS | | | |
--------------------------------------------------------------------------------
| EUR million | | | |
--------------------------------------------------------------------------------
| ASSETS | 31.3.2008 | 31.3.2007 | 31.12.2007 |
--------------------------------------------------------------------------------
| Non-current assets | | | |
--------------------------------------------------------------------------------
| Goodwill | 56.4 | 54.0 | 56.8 |
--------------------------------------------------------------------------------
| Other intangible assets | 60.8 | 54.7 | 59.4 |
--------------------------------------------------------------------------------
| Property, plant and equipment | 60.6 | 68.2 | 61.9 |
--------------------------------------------------------------------------------
| Advance payments and construction | 4.1 | 11.0 | 4.7 |
| in progress | | | |
--------------------------------------------------------------------------------
| Investments accounted for using | 4.1 | 6.1 | 6.3 |
| the equity method | | | |
--------------------------------------------------------------------------------
| Available-for-sale investments | 2.0 | 2.1 | 2.4 |
--------------------------------------------------------------------------------
| Long-term loans receivable | 1.6 | 0.5 | 1.7 |
--------------------------------------------------------------------------------
| Deferred tax assets | 24.7 | 25.4 | 24.9 |
--------------------------------------------------------------------------------
| Total non-current assets | 214.4 | 221.9 | 218.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Current assets | | | |
--------------------------------------------------------------------------------
| Inventories | | | |
--------------------------------------------------------------------------------
| Raw material and semi- | 112.0 | 96.7 | 105.3 |
| manufactured goods | | | |
--------------------------------------------------------------------------------
| Work in progress | 140.8 | 119.5 | 129.9 |
--------------------------------------------------------------------------------
| Advance payments | 21.9 | 35.4 | 16.0 |
--------------------------------------------------------------------------------
| Total inventories | 274.6 | 251.6 | 251.2 |
--------------------------------------------------------------------------------
| Accounts receivable | 332.5 | 283.9 | 328.0 |
--------------------------------------------------------------------------------
| Loans receivable | 0.3 | 0.1 | 0.2 |
--------------------------------------------------------------------------------
| Other receivables | 23.1 | 23.6 | 18.9 |
--------------------------------------------------------------------------------
| Deferred assets | 102.7 | 71.0 | 84.6 |
--------------------------------------------------------------------------------
| Cash and cash equivalents | 59.7 | 62.0 | 56.0 |
--------------------------------------------------------------------------------
| Total current assets | 793.0 | 692.3 | 738.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| TOTAL ASSETS | 1,007.4 | 914.2 | 956.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EQUITY AND LIABILITIES | 31.3.2008 | 31.3.2007 | 31.12.2007 |
--------------------------------------------------------------------------------
| Capital and reserves attributable | | | |
| to the shareholders of the parent | | | |
--------------------------------------------------------------------------------
| Share capital | 30.1 | 30.1 | 30.1 |
--------------------------------------------------------------------------------
| Share premium account | 39.3 | 39.3 | 39.3 |
--------------------------------------------------------------------------------
| Share issues | 0.7 | 0.2 | 0.0 |
--------------------------------------------------------------------------------
| Fair value reserves | 4.5 | 3.6 | 3.3 |
--------------------------------------------------------------------------------
| Translation difference | -21.0 | -6.1 | -12.9 |
--------------------------------------------------------------------------------
| Paid in capital | 3.5 | 1.9 | 4.7 |
--------------------------------------------------------------------------------
| Retained earnings | 169.8 | 129.6 | 87.0 |
--------------------------------------------------------------------------------
| Net profit for the period | 33.3 | 19.5 | 129.2 |
--------------------------------------------------------------------------------
| Total Shareholders' equity | 260.2 | 218.0 | 280.7 |
--------------------------------------------------------------------------------
| Minority interest | 1.4 | 0.1 | 0.1 |
--------------------------------------------------------------------------------
| Total equity | 261.6 | 218.0 | 280.8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Liabilities | | | |
--------------------------------------------------------------------------------
| Non-current liabilities | | | |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 49.0 | 79.4 | 45.7 |
--------------------------------------------------------------------------------
| Other long-term liabilities | 56.7 | 58.8 | 57.3 |
--------------------------------------------------------------------------------
| Deferred tax liabilities | 18.2 | 19.0 | 15.8 |
--------------------------------------------------------------------------------
| Total non-current liabilities | 123.9 | 157.2 | 118.8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Provisions | 35.9 | 27.3 | 37.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Current liabilities | | | |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 81.5 | 125.1 | 31.8 |
--------------------------------------------------------------------------------
| Advance payments received | 192.9 | 109.8 | 179.1 |
--------------------------------------------------------------------------------
| Progress billings | 2.7 | 8.5 | 2.7 |
--------------------------------------------------------------------------------
| Accounts payable | 101.2 | 102.2 | 120.4 |
--------------------------------------------------------------------------------
| Other short-term liabilities | 31.1 | 23.9 | 22.8 |
| (non-interest bearing) | | | |
--------------------------------------------------------------------------------
| Accruals | 176.6 | 142.2 | 163.3 |
--------------------------------------------------------------------------------
| Total current liabilities | 586.0 | 511.7 | 520.1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total liabilities | 745.8 | 696.2 | 676.1 |
--------------------------------------------------------------------------------
| TOTAL EQUITY AND LIABILITIES | 1007.4 | 914.2 | 956.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED STATEMENT | | | | | |
| OF CHANGES IN EQUITY - | | | | | |
| IFRS | | | | | |
--------------------------------------------------------------------------------
| EUR million | Share | Share | Share | Fair | Trans-lati |
| | capita | premium | issues | value | on |
| | l | account | | Reserves | Difference |
--------------------------------------------------------------------------------
| Balance at 1 January, | 30.1 | 39.3 | 0.0 | 3.3 | -12.9 |
| 2008 | | | | | |
--------------------------------------------------------------------------------
| Option excercised | | | | | |
--------------------------------------------------------------------------------
| Share issue | | | 0.7 | | |
--------------------------------------------------------------------------------
| Dividend distribution | | | | | |
--------------------------------------------------------------------------------
| Cash flow hedge | | | | 1.2 | |
--------------------------------------------------------------------------------
| Translation difference | | | | | -8.1 |
--------------------------------------------------------------------------------
| Share based payments | | | | | |
| recognized against | | | | | |
| equity | | | | | |
--------------------------------------------------------------------------------
| Purchase of treasury | | | | | |
| shares | | | | | |
--------------------------------------------------------------------------------
| Minority interest | | | | | |
--------------------------------------------------------------------------------
| Net profit for the | | | | | |
| period | | | | | |
--------------------------------------------------------------------------------
| Balance at 31 March, | 30.1 | 39.3 | 0.7 | 4.5 | -21.0 |
| 2008 | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Balance at 1 January, | 30.0 | 39.0 | 0.0 | 3.7 | -5.8 |
| 2007 | | | | | |
--------------------------------------------------------------------------------
| Option exercised | 0.0 | 0.3 | | | |
--------------------------------------------------------------------------------
| Share issue | | | 0.2 | | |
--------------------------------------------------------------------------------
| Dividend distribution | | | | | |
--------------------------------------------------------------------------------
| Cash flow hedge | | | | -0.1 | |
--------------------------------------------------------------------------------
| Translation difference | | | | | -0.3 |
--------------------------------------------------------------------------------
| Share based payments | | | | | |
| recognized against | | | | | |
| equity | | | | | |
--------------------------------------------------------------------------------
| Purchase of treasury | | | | | |
| shares | | | | | |
--------------------------------------------------------------------------------
| Minority interest | | | | | |
--------------------------------------------------------------------------------
| Net profit for the | | | | | |
| period | | | | | |
--------------------------------------------------------------------------------
| Balance at 31 March, | 30.1 | 39.3 | 0.2 | 3.6 | -6.1 |
| 2007 | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | | Paid in | Retained | Minority | Total |
| | | Capital | Earnings | interest | Equity |
--------------------------------------------------------------------------------
| Balance at 1 January, | | 4.7 | 216.2 | 0.1 | 280.8 |
| 2008 | | | | | |
--------------------------------------------------------------------------------
| Option excercised | | 0.4 | | | 0.4 |
--------------------------------------------------------------------------------
| Share issue | | | | | 0.7 |
--------------------------------------------------------------------------------
| Dividend distribution | | | -46.8 | | -46.8 |
--------------------------------------------------------------------------------
| Cash flow hedge | | | | | 1.2 |
--------------------------------------------------------------------------------
| Translation difference | | | | | -8.1 |
--------------------------------------------------------------------------------
| Share based payments | | | 0.4 | | 0.4 |
| recognized against | | | | | |
| equity | | | | | |
--------------------------------------------------------------------------------
| Purchase of treasury | | -1.6 | | | -1.6 |
| shares | | | | | |
--------------------------------------------------------------------------------
| Minority interest | | | | 1.3 | 1.3 |
--------------------------------------------------------------------------------
| Net profit for the | | | 33.3 | | 33.3 |
| period | | | | | |
--------------------------------------------------------------------------------
| Balance at 31 March, | | 3.5 | 203.1 | 1.4 | 261.6 |
| 2008 | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Balance at 1 January, | | 0.5 | 156.3 | 0.1 | 223.7 |
| 2007 | | | | | |
--------------------------------------------------------------------------------
| Option exercised | | 1.4 | | | 1.7 |
--------------------------------------------------------------------------------
| Share issue | | | | | 0.2 |
--------------------------------------------------------------------------------
| Dividend distribution | | | -26.8 | | -26.8 |
--------------------------------------------------------------------------------
| Cash flow hedge | | | | | -0.1 |
--------------------------------------------------------------------------------
| Translation difference | | | | | -0.3 |
--------------------------------------------------------------------------------
| Share based payments | | | 0.1 | | 0.1 |
| recognized against | | | | | |
| equity | | | | | |
--------------------------------------------------------------------------------
| Purchase of treasury | | | | | 0.0 |
| shares | | | | | |
--------------------------------------------------------------------------------
| Minority interest | | | | | 0.0 |
--------------------------------------------------------------------------------
| Net profit for the | | | 19.5 | | 19.5 |
| period | | | | | |
--------------------------------------------------------------------------------
| Balance at 31 March, | | 1.9 | 149.1 | 0.1 | 218.0 |
| 2007 | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED CASH FLOW STATEMENT - IFRS | | |
--------------------------------------------------------------------------------
| EUR million | 1-3/2008 | 1-3/2007 | 1-12/2007 |
--------------------------------------------------------------------------------
| Cash flow from operating | | | |
| activities | | | |
--------------------------------------------------------------------------------
| Operating income | 45.0 | 30.8 | 192.3 |
--------------------------------------------------------------------------------
| Adjustments to operating profit | | | |
--------------------------------------------------------------------------------
| Depreciation and impairments | 6.2 | 6.2 | 24.6 |
--------------------------------------------------------------------------------
| Profits and losses on sale of | 0.0 | -0.1 | -18.0 |
| fixed assets | | | |
--------------------------------------------------------------------------------
| Other non-cash items | 0.0 | -0.2 | -0.2 |
--------------------------------------------------------------------------------
| Operating income before change in | 51.1 | 36.7 | 198.7 |
| net working capital | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Change in interest-free short-term | -26.5 | 45.9 | -14.9 |
| receivables | | | |
--------------------------------------------------------------------------------
| Change in inventories | -25.4 | -22.4 | -28.3 |
--------------------------------------------------------------------------------
| Change in interest-free short-term | 22.8 | -25.7 | 77.6 |
| liabilities | | | |
--------------------------------------------------------------------------------
| Change in net working capital | -29.0 | -2.2 | 34.4 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from operations before | 22.1 | 34.5 | 233.2 |
| financing items and taxes | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest received | 0.2 | 0.4 | 2.2 |
--------------------------------------------------------------------------------
| Interest paid | -1.0 | -3.0 | -10.8 |
--------------------------------------------------------------------------------
| Other financial income and | 0.0 | -0.6 | -0.4 |
| expenses | | | |
--------------------------------------------------------------------------------
| Income taxes paid | -13.3 | -9.1 | -40.7 |
--------------------------------------------------------------------------------
| Financing items and taxes | -14.1 | -12.2 | -49.7 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net cash from operating activities | 8.0 | 22.3 | 183.5 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from investing | | | |
| activities | | | |
--------------------------------------------------------------------------------
| Acquisition of Group companies, | -1.1 | -5.1 | -13.8 |
| net of cash | | | |
--------------------------------------------------------------------------------
| Acquisition of shares in | 0.0 | 0.0 | 0.0 |
| associated company | | | |
--------------------------------------------------------------------------------
| Investments in other shares | -0.1 | -0.2 | -0.5 |
--------------------------------------------------------------------------------
| Capital expenditures | -2.6 | -6.8 | -22.5 |
--------------------------------------------------------------------------------
| Proceeds from sale of fixed assets | 0.1 | 0.1 | 32.3 |
--------------------------------------------------------------------------------
| Dividends received | 0.0 | 0.0 | 0.2 |
--------------------------------------------------------------------------------
| Net cash used in investing | -3.6 | -12.0 | -4.4 |
| activities | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow before financing | 4.4 | 10.3 | 179.1 |
| activities | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from financing | | | |
| activities | | | |
--------------------------------------------------------------------------------
| Proceeds from options exercised | 0.4 | 2.0 | 6.7 |
| and share issues | | | |
--------------------------------------------------------------------------------
| Purchase of treasury shares | -2.5 | 0.0 | -46.0 |
--------------------------------------------------------------------------------
| Proceeds from long-term borrowings | 2.5 | 0.0 | 100.1 |
--------------------------------------------------------------------------------
| Repayments of long-term borrowings | 0.0 | -40.8 | -177.8 |
--------------------------------------------------------------------------------
| Proceeds from (+), payments of (-) | 47.4 | 73.1 | -20.8 |
| short-term borrowings | | | |
--------------------------------------------------------------------------------
| Change in longt-term receivables | 0.1 | -0.1 | -1.3 |
--------------------------------------------------------------------------------
| Change in short-term receivables | -0.1 | 0.1 | 0.0 |
--------------------------------------------------------------------------------
| Dividends paid | -46.8 | -26.8 | -26.7 |
--------------------------------------------------------------------------------
| Net cash used in financing | 1.1 | 7.5 | -165.8 |
| activities | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Translation differences in cash | -1.8 | -0.1 | -1.7 |
--------------------------------------------------------------------------------
| Change of cash and cash | 3.8 | 17.7 | 11.6 |
| equivalents | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at | 56.0 | 44.4 | 44.4 |
| beginning of period | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at end | 59.7 | 62.0 | 56.0 |
| of period | | | |
--------------------------------------------------------------------------------
| Change of cash and cash | 3.8 | 17.7 | 11.6 |
| equivalents | | | |
--------------------------------------------------------------------------------
The effect of changes in exchange rates has been eliminated by converting the
beginning balance at the rates current on the last day of the year.
--------------------------------------------------------------------------------
| SEGMENT | | | | | | |
| INFORMATION | | | | | | |
--------------------------------------------------------------------------------
| 1. BUSINESS | | | | | | |
| SEGMENTS | | | | | | |
--------------------------------------------------------------------------------
| EUR million | | | | | | |
--------------------------------------------------------------------------------
| Order Intakes by | 1-3/ | % of | 1-3/ | % of | 1-12/ | % of |
| Business Area | 2008 | total | 2007 | total | 2007 | total |
--------------------------------------------------------------------------------
| Service 1) | 156.1 | 26 | 159.0 | 35 | 623.4 | 31 |
--------------------------------------------------------------------------------
| Standard Lifting | 222.2 | 38 | 183.4 | 40 | 743.3 | 37 |
--------------------------------------------------------------------------------
| Heavy Lifting | 212.2 | 36 | 114.9 | 25 | 620.4 | 31 |
--------------------------------------------------------------------------------
| ./. Internal | -28.2 | | -27.8 | | -115.1 | |
--------------------------------------------------------------------------------
| Total | 562.3 | 100 | 429.4 | 100 | 1,872.0 | 100 |
--------------------------------------------------------------------------------
| 1) Excl. Service | | | | | | |
| Contract Base | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Order Book 2) | 31.3.20 | | 31.3.2007 | | 31.12.200 | |
| | 08 | | | | 7 | |
--------------------------------------------------------------------------------
| Total | 909.7 | | 636.8 | | 757.9 | |
--------------------------------------------------------------------------------
| 2) Percentage of | | | | | | |
| completion | | | | | | |
| deducted | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Sales by Business | 1-3/ | % of | 1-3/ | % of | 1-12/ | % of |
| Area | 2008 | total | 2007 | total | 2007 | total |
--------------------------------------------------------------------------------
| Service | 166.1 | 35 | 163.2 | 40 | 692.2 | 37 |
--------------------------------------------------------------------------------
| Standard Lifting | 168.3 | 36 | 131.8 | 33 | 638.9 | 34 |
--------------------------------------------------------------------------------
| Heavy Lifting | 134.2 | 29 | 110.6 | 27 | 535.7 | 29 |
--------------------------------------------------------------------------------
| ./. Internal | -29.5 | | -25.0 | | -116.9 | |
--------------------------------------------------------------------------------
| Total | 439.2 | 100 | 380.5 | 100.0 | 1,749.7 | 100 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating Profit | 1-3/ | EBIT% | 1-3/ | EBIT% | 1-12/ | EBIT% |
| (EBIT) by | 2008 | | 2007 | | 2007 | |
| Business Area | MEUR | | MEUR | | MEUR | |
| without gain on | | | | | | |
| the sale of real | | | | | | |
| estate | | | | | | |
--------------------------------------------------------------------------------
| Service | 22.2 | 13.4 | 18.5 | 11.3 | 91.9 | 13.3 |
--------------------------------------------------------------------------------
| Standard Lifting | 26.8 | 15.9 | 14.3 | 10.9 | 90.4 | 14.2 |
--------------------------------------------------------------------------------
| Heavy Lifting | 7.7 | 5.8 | 7.3 | 6.6 | 31.6 | 5.9 |
--------------------------------------------------------------------------------
| Group costs | -11.0 | | -8.5 | | -36.8 | |
--------------------------------------------------------------------------------
| Consolidation | -0.7 | | -0.7 | | -2.3 | |
| items | | | | | | |
--------------------------------------------------------------------------------
| Total | 45.0 | 10.2 | 30.8 | 8.1 | 174.7 | 10.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total Operating | 1-3/ | EBIT% | 1-3/ | EBIT% | 1-12/ | EBIT% |
| Profit (EBIT) by | 2008 | | 2007 | | 2007 | |
| Business Area | MEUR | | MEUR | | MEUR | |
--------------------------------------------------------------------------------
| Service | 22.2 | 13.4 | 18.5 | 11.3 | 92.7 | 13.4 |
--------------------------------------------------------------------------------
| Standard Lifting | 26.8 | 15.9 | 14.3 | 10.9 | 99.3 | 15.5 |
--------------------------------------------------------------------------------
| Heavy Lifting | 7.7 | 5.8 | 7.3 | 6.6 | 39.5 | 7.4 |
--------------------------------------------------------------------------------
| Group costs | -11.0 | | -8.5 | | -36.8 | |
--------------------------------------------------------------------------------
| Consolidation | -0.7 | | -0.7 | | -2.3 | |
| items | | | | | | |
--------------------------------------------------------------------------------
| Total | 45.0 | 10.2 | 30.8 | 8.1 | 192.3 | 11.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Personnel by | 31.3.20 | | 31.3.2007 | | 31.12.200 | |
| Business Area | 08 | | | | 7 | |
--------------------------------------------------------------------------------
| (at the End of | | % of | | % of | | % of |
| the Period) | | total | | total | | total |
--------------------------------------------------------------------------------
| Service | 4 855 | 55 | 4 128 | 53 | 4 436 | 53 |
--------------------------------------------------------------------------------
| Standard Lifting | 2 471 | 28 | 2 321 | 30 | 2 479 | 29 |
--------------------------------------------------------------------------------
| Heavy Lifting | 1 296 | 15 | 1 173 | 15 | 1 272 | 15 |
--------------------------------------------------------------------------------
| Group staff | 223 | 3 | 183 | 2 | 217 | 3 |
--------------------------------------------------------------------------------
| Total | 8 845 | 100 | 7 805 | 100 | 8 404 | 100 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 2. GEOGRAPHICAL | | | | | | |
| SEGMENTS | | | | | | |
--------------------------------------------------------------------------------
| EUR million | | | | | | |
--------------------------------------------------------------------------------
| Sales by Market | 1-3/200 | % of | 1-3/2007 | % of | 1-12/2007 | % of |
| | 8 | total | | total | | total |
--------------------------------------------------------------------------------
| Europe-Middle | 243.3 | 55 | 188.2 | 49 | 951.4 | 54 |
| East-Africa | | | | | | |
| (EMEA) | | | | | | |
--------------------------------------------------------------------------------
| Americas (AME) | 144.3 | 33 | 151.7 | 40 | 589.7 | 34 |
--------------------------------------------------------------------------------
| Asia-Pacific | 51.5 | 12 | 40.7 | 11 | 208.6 | 12 |
| (APAC) | | | | | | |
--------------------------------------------------------------------------------
| Total | 439.2 | 100.0 | 380.5 | 100.0 | 1 749.7 | 100.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NOTES: | | | | |
--------------------------------------------------------------------------------
| KEY FIGURES | 1-3/2008 | 1-3/2007 | Change % | 1-12/2007 |
--------------------------------------------------------------------------------
| Earnings per share, basic | 0.57 | 0.33 | 73.8 | 2.17 |
| (EUR) | | | | |
--------------------------------------------------------------------------------
| Earnings per share, diluted | 0.56 | 0.32 | 75.2 | 2.13 |
| (EUR) | | | | |
--------------------------------------------------------------------------------
| Return on capital employed | 51.0 | 33.3 | 53.2 | 50.4 |
| %, Rolling 12 Months (R12M) | | | | |
--------------------------------------------------------------------------------
| Return on equity %, Rolling | 59.6 | 42.8 | 39.3 | 51.2 |
| 12 Months (R12M) | | | | |
--------------------------------------------------------------------------------
| Equity per share, EUR | 4.47 | 3.66 | 22.1 | 4.80 |
--------------------------------------------------------------------------------
| Current ratio | 1.3 | 1.3 | 0.0 | 1.3 |
--------------------------------------------------------------------------------
| Gearing % | 26.3 | 65.0 | -59.5 | 7.0 |
--------------------------------------------------------------------------------
| Solidity % | 32.1 | 27.1 | 18.5 | 36.1 |
--------------------------------------------------------------------------------
| Investments total (excl. | 3.1 | 5.4 | -42.9 | 25.2 |
| Acquisitions), EUR million | | | | |
--------------------------------------------------------------------------------
| Interest-bearing net debt, | 68.9 | 141.8 | -51.4 | 19.7 |
| EUR million | | | | |
--------------------------------------------------------------------------------
| Net working capital, EUR | 199.1 | 222.6 | -10.6 | 166.4 |
| million | | | | |
--------------------------------------------------------------------------------
| Average number of personnel | 8 625 | 7 677 | 12.3 | 8 005 |
| during the period | | | | |
--------------------------------------------------------------------------------
| Average number of shares | 58,469,65 | 59,367,12 | -1.5 | 59,608,990 |
| outstanding, basic | 2 | 0 | | |
--------------------------------------------------------------------------------
| Average number of shares | 59,089,95 | 60,473,63 | -2.3 | 60,507,038 |
| outstanding, diluted | 6 | 0 | | |
--------------------------------------------------------------------------------
| Number of shares | 58,504,82 | 59,529,62 | -1.7 | 58,505,780 |
| outstanding, at end of the | 0 | 0 | | |
| period | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| The period end exchange | 31.3.2008 | 31.3.2007 | | 31.12.2007 |
| rates: | | | | |
--------------------------------------------------------------------------------
| USD | 1.580 | 1.332 | -15.7 % | 1.472 |
--------------------------------------------------------------------------------
| CAD | 1.608 | 1.537 | -4.4 % | 1.445 |
--------------------------------------------------------------------------------
| GBP | 0.791 | 0.680 | -14.0 % | 0.733 |
--------------------------------------------------------------------------------
| CNY | 11.076 | 10.295 | -7.1 % | 10.752 |
--------------------------------------------------------------------------------
| SGD | 2.179 | 2.020 | -7.3 % | 2.116 |
--------------------------------------------------------------------------------
| SEK | 9.377 | 9.346 | -0.3 % | 9.442 |
--------------------------------------------------------------------------------
| NOK | 8.048 | 8.119 | 0.9 % | 7.958 |
--------------------------------------------------------------------------------
| AUD | 1.717 | 1.648 | -4.0 % | 1.676 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| The period average | 31.3.2008 | 31.3.2007 | | 31.12.2007 |
| exchange rates: | | | | |
--------------------------------------------------------------------------------
| USD | 1.496 | 1.311 | -12.4 % | 1.370 |
--------------------------------------------------------------------------------
| CAD | 1.500 | 1.536 | 2.4 % | 1.468 |
--------------------------------------------------------------------------------
| GBP | 0.756 | 0.671 | -11.3 % | 0.684 |
--------------------------------------------------------------------------------
| CNY | 10.721 | 10.169 | -5.1 % | 10.416 |
--------------------------------------------------------------------------------
| SGD | 2.110 | 2.007 | -4.8 % | 2.063 |
--------------------------------------------------------------------------------
| SEK | 9.400 | 9.189 | -2.2 % | 9.249 |
--------------------------------------------------------------------------------
| NOK | 7.957 | 8.169 | 2.7 % | 8.016 |
--------------------------------------------------------------------------------
| AUD | 1.652 | 1.667 | 0.9 % | 1.635 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONTINGENT LIABILITIES AND PLEDGED | | | |
| ASSETS | | | |
--------------------------------------------------------------------------------
| EUR million | 31.3.2008 | 31.3.2007 | 31.12.2007 |
--------------------------------------------------------------------------------
| Contingent liabilities | | | |
--------------------------------------------------------------------------------
| For own debts | | | |
--------------------------------------------------------------------------------
| Mortgages on land and buildings | 0.0 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
| For own commercial obligations | | | |
--------------------------------------------------------------------------------
| Pledged assets | 1.3 | 1.1 | 0.3 |
--------------------------------------------------------------------------------
| Guarantees | 243.3 | 154.0 | 255.3 |
--------------------------------------------------------------------------------
| Other contingent liabilities and | | | |
| financial liabilities | | | |
--------------------------------------------------------------------------------
| Contingent liabilities | | | |
--------------------------------------------------------------------------------
| Next year | 23.2 | 11.8 | 24.1 |
--------------------------------------------------------------------------------
| Later on | 63.5 | 26.0 | 63.7 |
--------------------------------------------------------------------------------
| Other | 0.2 | 1.5 | 0.0 |
--------------------------------------------------------------------------------
| Total | 331.5 | 194.4 | 343.5 |
--------------------------------------------------------------------------------
| Leasing contracts follow the normal | | | |
| practices in corresponding | | | |
| countries. | | | |
--------------------------------------------------------------------------------
| Total by category | | | |
--------------------------------------------------------------------------------
| Mortgages on land and buildings | 0.0 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
| Pledged assets | 1.3 | 1.1 | 0.3 |
--------------------------------------------------------------------------------
| Guarantees | 243.3 | 154.0 | 255.3 |
--------------------------------------------------------------------------------
| Other liabilities | 86.8 | 39.3 | 87.9 |
--------------------------------------------------------------------------------
| Total | 331.5 | 194.4 | 343.5 |
--------------------------------------------------------------------------------
Contingent liabilities relating to litigations
Various legal actions, claims and other proceedings are pending against the
Group in various countries. These actions, claims and other proceedings are
typical for this industry and consistent with a global business offering that
encompasses a wide range of products and services. These matters involve
contractual disputes, warranty claims, product liability (including design
defects, manufacturing defects, failure to warn and asbestos legacy),
employment, vehicles and other matters involving claims of general liability.
While the final outcome of these matters cannot be predicted with certainty
Konecranes is of the opinion, based on the information available to date and
considering the grounds presented for such claims, available insurance coverage
and the reserves made, that the outcome of such actions, claims and other
proceedings, if unfavorable, would not have a material, adverse impact on the
financial condition of the Group.
--------------------------------------------------------------------------------
| NOTIONAL AND FAIR VALUES OF DERIVATIVE | | | |
| FINANCIAL INSTRUMENTS | | | |
--------------------------------------------------------------------------------
| EUR million | 31.3. | 31.3. | 31.3. | 31.3. | 31.12. | 31.12. |
| | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 |
--------------------------------------------------------------------------------
| | Nominal | Fair | Nominal | Fair | Nominal | Fair |
| | value | value | value | value | value | value |
--------------------------------------------------------------------------------
| Foreign | 155.8 | 8.4 | 176.8 | 2.7 | 168.8 | 5.4 |
| exchange | | | | | | |
| forward | | | | | | |
| contracts | | | | | | |
--------------------------------------------------------------------------------
| Electricity | 1.2 | 0.2 | 1.2 | 0.0 | 0.9 | 0.3 |
| derivatives | | | | | | |
--------------------------------------------------------------------------------
| Total | 157.0 | 8.6 | 178.1 | 2.7 | 169.7 | 5.7 |
--------------------------------------------------------------------------------
Derivatives are used for hedging currency and interest rate risks, as well as
the risk of electricity price fluctuations. The Company applies hedge accounting
on the derivatives used to hedge cash flows in Heavy Lifting projects.
ACQUISITIONS
At the end of January 2008 Konecranes strengthened its position in the machine
tool service (MTS) business in Scandinavia by acquiring the business of the
Norwegian MTS company Eiker Automajon AS. On March 6 Konecranes acquired the
entire share capital of Eydimen 2000 S.L., the Spanish crane and service
company. Prior to this transaction, Konecranes held 19.2 percent of the share
capital in Eydimen. Also at the beginning of March Konecranes acquired
additional 62.8 percent of the Finnish company Nostininnovaatiot Oy. Prior stake
in this company was 17.4 percent. On March 31 Konecranes signed an agreement to
exercise its options to raise its holding in the joint venture company Meiden
Hoist System Company, Ltd of Japan from 49.0 to 65.0 percent.
The preliminary fair values of the identifiable assets and liabilities of the
acquired businesses at the date of acquisitions are
summarized below.
--------------------------------------------------------------------------------
| EUR million | 31.3.2008 | 31.3.2008 |
--------------------------------------------------------------------------------
| | Recognized on | Carrying |
| | acquisition | value |
--------------------------------------------------------------------------------
| Intangible assets | 4.4 | 0.1 |
--------------------------------------------------------------------------------
| Tangible assets | 0.3 | 0.3 |
--------------------------------------------------------------------------------
| Deferred tax assets | 0.4 | 0.4 |
--------------------------------------------------------------------------------
| Inventories | 3.8 | 3.5 |
--------------------------------------------------------------------------------
| Account receivables and other assets | 11.4 | 11.4 |
--------------------------------------------------------------------------------
| Cash and bank | 1.5 | 1.5 |
--------------------------------------------------------------------------------
| Total assets | 21.9 | 17.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Deferred tax liabilities | 2.1 | 0.0 |
--------------------------------------------------------------------------------
| Account payables | 7.3 | 7.3 |
--------------------------------------------------------------------------------
| Other liabilities | 5.8 | 5.8 |
--------------------------------------------------------------------------------
| Minority interest | 1.3 | 1.0 |
--------------------------------------------------------------------------------
| Total liabilities | 16.5 | 14.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net assets | 5.4 | 3.1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Acquisition costs | 5.4 | |
--------------------------------------------------------------------------------
| Goodwill | 0.0 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash outflow on acquisition | | |
--------------------------------------------------------------------------------
| Acquisition costs | 5.4 | |
--------------------------------------------------------------------------------
| Cash flow of earlier interests in | -2.7 | |
| acquired businesses | | |
--------------------------------------------------------------------------------
| Liabilities assumed | -0.1 | |
--------------------------------------------------------------------------------
| Acquisition costs paid in cash | 2.6 | |
--------------------------------------------------------------------------------
| Cash and cash equivalents of acquired | -1.5 | |
| companies | | |
--------------------------------------------------------------------------------
| Net cash flow arising on acquisition | 1.1 | |
--------------------------------------------------------------------------------
QUARTERLY FIGURES:
--------------------------------------------------------------------------------
| CONSOLIDATED STATEMENT OF INCOME - IFRS, | | | |
| QUARTERLY | | | |
--------------------------------------------------------------------------------
| EUR million | Q1/2008 | Q4/2007 | Q3/2007 | Q2/2007 | Q1/2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Sales | 439.2 | 522.8 | 424.4 | 422.0 | 380.5 |
--------------------------------------------------------------------------------
| Other operating income | 0.6 | 0.8 | 0.6 | 18.2 | 0.7 |
--------------------------------------------------------------------------------
| Depreciation and | -6.2 | -6.9 | -5.7 | -5.9 | -6.2 |
| impairments | | | | | |
--------------------------------------------------------------------------------
| Other operating expenses | -388.7 | -456.3 | -373.8 | -378.7 | -344.3 |
--------------------------------------------------------------------------------
| Operating profit | 45.0 | 60.4 | 45.5 | 55.6 | 30.8 |
--------------------------------------------------------------------------------
| Share of result of | 0.2 | 0.1 | 0.4 | 0.5 | -0.2 |
| associates and joint | | | | | |
| ventures | | | | | |
--------------------------------------------------------------------------------
| Financial income and | 1.1 | -3.6 | -4.3 | -3.1 | -3.2 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| Profit before taxes | 46.3 | 56.9 | 41.5 | 53.0 | 27.4 |
--------------------------------------------------------------------------------
| Taxes | -13.0 | -14.3 | -12.0 | -15.4 | -8.0 |
--------------------------------------------------------------------------------
| Net profit for the | 33.3 | 42.6 | 29.5 | 37.6 | 19.5 |
| period | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED BALANCE SHEET - IFRS | | | | |
--------------------------------------------------------------------------------
| EUR million | Q1/2008 | Q4/2007 | Q3/2007 | Q2/2007 | Q1/2007 |
--------------------------------------------------------------------------------
| ASSETS | | | | | |
--------------------------------------------------------------------------------
| Goodwill | 56.4 | 56.8 | 58.4 | 55.2 | 54.0 |
--------------------------------------------------------------------------------
| Other intangible assets | 60.8 | 59.4 | 61.1 | 52.6 | 54.7 |
--------------------------------------------------------------------------------
| Property, plant and | 60.6 | 61.9 | 59.4 | 59.0 | 68.2 |
| equipment | | | | | |
--------------------------------------------------------------------------------
| Other | 36.6 | 40.0 | 43.3 | 43.8 | 45.1 |
--------------------------------------------------------------------------------
| Total Non-current assets | 214.4 | 218.0 | 222.2 | 210.6 | 221.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Inventories | 274.6 | 251.2 | 268.3 | 257.2 | 251.6 |
--------------------------------------------------------------------------------
| Receivables and other | 458.7 | 431.7 | 422.2 | 402.3 | 378.6 |
| current assets | | | | | |
--------------------------------------------------------------------------------
| Cash and cash | 59.7 | 56.0 | 57.3 | 62.0 | 62.0 |
| equivalents | | | | | |
--------------------------------------------------------------------------------
| Total Current assets | 793.0 | 738.9 | 747.8 | 721.6 | 692.3 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total Assets | 1 007.4 | 956.9 | 970.1 | 932.3 | 914.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EQUITY AND LIABILITIES | | | | | |
--------------------------------------------------------------------------------
| Total Equity | 261.6 | 280.8 | 287.1 | 259.2 | 218.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-current liabilities | 123.9 | 118.8 | 151.8 | 154.0 | 157.2 |
--------------------------------------------------------------------------------
| Provisions | 35.9 | 37.2 | 30.5 | 27.3 | 27.3 |
--------------------------------------------------------------------------------
| Advance payments | 192.9 | 179.1 | 158.7 | 134.6 | 109.8 |
| received | | | | | |
--------------------------------------------------------------------------------
| Other current | 393.1 | 340.9 | 341.9 | 357.1 | 401.9 |
| liabilities | | | | | |
--------------------------------------------------------------------------------
| Total Liabilities | 745.8 | 676.1 | 682.9 | 673.0 | 696.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total Equity and | 1,007.4 | 956.9 | 970.1 | 932.2 | 914.2 |
| Liabilities | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED CASH FLOW STATEMENT - | | | |
| QUARTERLY | | | |
--------------------------------------------------------------------------------
| EUR million | Q1/2008 | Q4/2007 | Q3/2007 | Q2/2007 | Q1/2007 |
--------------------------------------------------------------------------------
| Cash flow before change | 51.1 | 67.2 | 51.0 | 43.8 | 36.7 |
| in net working capital | | | | | |
--------------------------------------------------------------------------------
| Change in net working | -29.0 | 39.2 | 10.5 | -13.1 | -2.2 |
| capital | | | | | |
--------------------------------------------------------------------------------
| Financing items and | -14.1 | -9.5 | -9.5 | -18.4 | -12.2 |
| taxes | | | | | |
--------------------------------------------------------------------------------
| Net cash from operating | 8.0 | 96.9 | 52.1 | 12.2 | 22.3 |
| activities | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from investing | -3.6 | -6.4 | -12.1 | 26.1 | -12.0 |
| activities | | | | | |
--------------------------------------------------------------------------------
| Cash flow before | 4.4 | 90.5 | 40.0 | 38.3 | 10.3 |
| financing activities | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Proceeds from options | 0.4 | 1.2 | -0.1 | 3.6 | 2.0 |
| exercised and share | | | | | |
| issues | | | | | |
--------------------------------------------------------------------------------
| Purchase of treasury | -2.5 | -46.0 | 0.0 | 0.0 | 0.0 |
| shares | | | | | |
--------------------------------------------------------------------------------
| Change of | 50.0 | -46.3 | -28.7 | -57.0 | 32.3 |
| interest-bearing debt | | | | | |
--------------------------------------------------------------------------------
| Dividends paid | -46.8 | 0.0 | 0.0 | 0.1 | -26.8 |
--------------------------------------------------------------------------------
| Net cash used in | 1.1 | -91.1 | -28.8 | -53.3 | 7.5 |
| financing activities | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Translation differences | -1.8 | -0.7 | -1.0 | 0.1 | -0.1 |
| in cash | | | | | |
--------------------------------------------------------------------------------
| Change of cash and cash | 3.8 | -1.4 | 10.2 | -14.9 | 17.7 |
| equivalents | | | | | |
--------------------------------------------------------------------------------
| Cash and cash | 56.0 | 57.3 | 47.1 | 62.0 | 44.4 |
| equivalents at beginning | | | | | |
| of period | | | | | |
--------------------------------------------------------------------------------
| Cash and cash | 59.7 | 56.0 | 57.3 | 47.1 | 62.0 |
| equivalents at end of | | | | | |
| period | | | | | |
--------------------------------------------------------------------------------
| Change of cash and cash | 3.8 | -1.4 | 10.2 | -14.9 | 17.7 |
| equivalents | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| QUARTERLY SEGMENT | | | | | |
| INFORMATION | | | | | |
--------------------------------------------------------------------------------
| EUR million | | | | | |
--------------------------------------------------------------------------------
| Sales by Business Area | Q1/2008 | Q4/2007 | Q3/2007 | Q2/2007 | Q1/2007 |
--------------------------------------------------------------------------------
| Service | 166.1 | 189.1 | 173.2 | 166.7 | 163.2 |
--------------------------------------------------------------------------------
| Standard Lifting | 168.3 | 186.9 | 163.4 | 156.8 | 131.8 |
--------------------------------------------------------------------------------
| Heavy Lifting | 134.2 | 184.4 | 115.0 | 125.8 | 110.6 |
--------------------------------------------------------------------------------
| ./. Internal | -29.5 | -37.6 | -27.2 | -27.2 | -25.0 |
--------------------------------------------------------------------------------
| Total | 439.2 | 522.8 | 424.4 | 422.0 | 380.5 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating Profit (EBIT) | Q1/2008 | Q4/2007 | Q3/2007 | Q2/2007 | Q1/2007 |
| by Business Area without | | | | | |
| gain on the sale of real | | | | | |
| estate | | | | | |
--------------------------------------------------------------------------------
| Service | 22.2 | 27.6 | 24.7 | 21.1 | 18.5 |
--------------------------------------------------------------------------------
| Standard Lifting | 26.8 | 29.0 | 25.1 | 21.9 | 14.3 |
--------------------------------------------------------------------------------
| Heavy Lifting | 7.7 | 15.0 | 3.8 | 5.5 | 7.3 |
--------------------------------------------------------------------------------
| Group costs | -11.0 | -12.2 | -5.9 | -10.2 | -8.5 |
--------------------------------------------------------------------------------
| Consolidation items | -0.7 | 1.0 | -2.3 | -0.3 | -0.7 |
--------------------------------------------------------------------------------
| Total | 45.0 | 60.4 | 45.5 | 38.0 | 30.8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Order Intakes by | Q1/2008 | Q4/2007 | Q3/2007 | Q2/2007 | Q1/2007 |
| Business Area | | | | | |
--------------------------------------------------------------------------------
| Service 1) | 156.1 | 152.4 | 154.8 | 157.2 | 159.0 |
--------------------------------------------------------------------------------
| Standard Lifting | 222.2 | 184.2 | 188.2 | 187.5 | 183.4 |
--------------------------------------------------------------------------------
| Heavy Lifting | 212.2 | 165.3 | 191.8 | 148.4 | 114.9 |
--------------------------------------------------------------------------------
| ./. Internal | -28.2 | -30.9 | -28.4 | -28.0 | -27.8 |
--------------------------------------------------------------------------------
| Total | 562.3 | 471.0 | 506.4 | 465.1 | 429.4 |
--------------------------------------------------------------------------------
| 1) Excl. Service | | | | | |
| Contract Base | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Order book by Business | Q1/2008 | Q4/2007 | Q3/2007 | Q2/2007 | Q1/2007 |
| Area | | | | | |
--------------------------------------------------------------------------------
| Service | 121.8 | 109.3 | 122.8 | 124.5 | 112.9 |
--------------------------------------------------------------------------------
| Standard Lifting | 338.4 | 270.9 | 267.7 | 239.5 | 211.0 |
--------------------------------------------------------------------------------
| Heavy Lifting | 476.5 | 406.1 | 434.3 | 360.9 | 336.0 |
--------------------------------------------------------------------------------
| ./. Internal | -27.0 | -28.4 | -29.9 | -25.1 | -23.1 |
--------------------------------------------------------------------------------
| Total | 909.7 | 757.9 | 794.8 | 699.8 | 636.8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Sales by Market | Q1/2008 | Q4/2007 | Q3/2007 | Q2/2007 | Q1/2007 |
--------------------------------------------------------------------------------
| Europe-MiddleEast-Africa | 243.3 | 297.6 | 238.6 | 227.0 | 188.2 |
| (EMEA) | | | | | |
--------------------------------------------------------------------------------
| Americas (AME) | 144.3 | 159.6 | 135.4 | 143.1 | 151.7 |
--------------------------------------------------------------------------------
| Asia-Pacific (APAC) | 51.5 | 65.6 | 50.4 | 51.9 | 40.7 |
--------------------------------------------------------------------------------
| Total | 439.2 | 522.8 | 424.4 | 422.0 | 380.5 |
--------------------------------------------------------------------------------
ACCOUNTING PRINCIPLES
The presented financial information is construed according to the recognition
and measurement principles of International Financial Reporting Standards
(IFRS).
Konecranes applies the same accounting policies as were applied in the 2007
annual financial statements, except for the change in Segment reporting. The
change in the Segment reporting method is that the non-Konecranes branded spare
parts business is included in the Service Business area, where previously it was
reported in Standard and Heavy Lifting. The spare part business for
Konecranes-branded products was included in the Service Business area as of
2007. The 2007 comparison figures according to the new reporting structure are
restated accordingly.
The key figures in this interim financial report are calculated with same
accounting principles than in year 2007 annual financial statements. The
calculation rules of key figures are presented in the financial statements of
the previous year.
The figures presented in the tables above 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.
Events on 29 April, 2008
Analyst and press briefing
A luncheon presentation for media and analysts will be held at Konecranes office
in Helsinki at 12.00 noon Finnish Time (address: Eteläesplanadi 22 B).
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.
Internet
This report and presentation material is available on the Internet at
www.konecranes.com immediately after publication. A recording of the webcast
will be available on the Internet later on the same day.
Next report
Konecranes Interim Report January - June 2008 will be published on 30 July, 2008
10.00 a.m.
KONECRANES PLC
Paul Lönnfors
IR Manager
FURTHER INFORMATION
Mr Pekka Lundmark, President and CEO, tel. +358-20 427 2000
Mr Teo Ottola, Chief Financial Officer, tel. +358-20 427 2040,
Mr Paul Lönnfors, IR Manager, tel. +358-20 427 2050
DISTRIBUTION
OMX Nordic Exchange
Media
