KONECRANES PLC: SOLID PERFORMANCE IN SERVICE, EQUIPMENT MARKET UNCERTAINTY CONTINUES
KONECRANES PLC FINANCIAL STATEMENTS BULLETIN February 5, 2014 at 9:00 a.m.
Figures in brackets, unless otherwise stated, refer to the same period a year earlier.
FOURTH QUARTER HIGHLIGHTS
- Order intake EUR 422.2 million (423.8), -0.4 percent; Service -8.7 percent and Equipment +3.9 percent.
- Service contract base value EUR 178.2 million (177.9), +0,2 percent; +4.8 percent at comparable currency rates.
- Order book EUR 893.5 million (942.7) at year-end, -5.2 percent compared with a year before.
- Sales EUR 580.9 million (605.1), -4.0 percent; Service +3.6 percent and Equipment -9.2 percent.
- Operating profit excluding restructuring costs EUR 42.8 million (42.2), 7.4 percent (7.0) of sales.
- Restructuring costs EUR 3.1 million (5.8).
- Operating profit including restructuring costs EUR 39.7 million (36.4), 6.8 percent of sales (6.0).
- Earnings per share (diluted) EUR 0.38 (0.39).
- Net cash flow from operating activities EUR 79.6 million (84.9).
- Net debt EUR 187.3 million (181.8) and gearing 42.1 percent (39.3).
FULL-YEAR 2013 HIGHLIGHTS
- Orders received EUR 1,920.8 million (1,970.1), -2.5 percent; Service -2.6 percent and Equipment -1.5 percent.
- Sales EUR 2,099.6 million (2,171.5), -3.3 percent; Service +0.6 percent and Equipment -5.9 percent.
- Operating profit excluding restructuring costs EUR 115.5 million (138.3), 5.5 percent (6.4) of sales.
- Restructuring costs EUR 30.9 million (5.8).
- Operating profit including restructuring costs EUR 84.5 million (132.5), 4.0 percent of sales (6.1).
- Earnings per share (diluted) EUR 0.85 (1.46).
- Net cash flow from operating activities EUR 120.2 million (158.6).
- Dividend proposed by Board of Directors is EUR 1.05 (1.05) per share.
MARKET OUTLOOK
The growth in industrial production and container traffic is moderate and below the historical averages. The near-term investment outlook within manufacturing and process industries, as well as container handling, remains uncertain. However, there are certain positive macroeconomic signs in the developed world also outside the US.
FINANCIAL GUIDANCE
The order book at year-end 2013 was below the previous year, which will affect the company’s sales and operating profit in the beginning of the year. Due to the market uncertainty, it is too early to estimate the full-year 2014 sales development. The ongoing restructuring actions and improving project execution are expected to have a positive impact on profitability.
| KEY FIGURES | Fourth quarter | January-December | ||||
| 10-12/ 2013 | 10-12/ 2012 | Change % | 1-12/ 2013 | 1-12/ 2012 | Change % | |
| Orders received, MEUR | 422.2 | 423.8 | -0.4 | 1,920.8 | 1,970.1 | -2.5 |
| Order book at end of period, MEUR | 893.5 | 942.7 | -5.2 | |||
| Sales total, MEUR | 580.9 | 605.1 | -4.0 | 2,099.6 | 2,171.5 | -3.3 |
| EBITDA excluding restructuring costs, MEUR | 52.3 | 52.9 | -1.2 | 154.6 | 179.7 | -14.0 |
| EBITDA excluding restructuring costs, % | 9.0 | 8.7 | 7.4 | 8.3 | ||
| Operating profit excluding restructuring costs, MEUR | 42.8 | 42.2 | 1.4 | 115.5 | 138.3 | -16.5 |
| Operating margin excluding restructuring costs, % | 7.4 | 7.0 | 5.5 | 6.4 | ||
| EBITDA, MEUR | 49.9 | 50.0 | -0.3 | 140.5 | 176.8 | -20.5 |
| EBITDA, % | 8.6 | 8.3 | 6.7 | 8.1 | ||
| Operating profit, MEUR | 39.7 | 36.4 | 9.0 | 84.5 | 132.5 | -36.2 |
| Operating margin, % | 6.8 | 6.0 | 4.0 | 6.1 | ||
| Profit before taxes, MEUR | 35.9 | 33.7 | 6.4 | 75.5 | 124.2 | -39.2 |
| Net profit for the period, MEUR | 22.1 | 22.3 | -0.9 | 49.4 | 84.8 | -41.7 |
| Earnings per share, basic, EUR | 0.38 | 0.39 | -2.3 | 0.85 | 1.47 | -42.1 |
| Earnings per share, diluted, EUR | 0.38 | 0.39 | -2.2 | 0.85 | 1.46 | -42.0 |
| Dividend per share, EUR | 1.05* | 1.05 | 0.0 | |||
| Gearing, % | 42.1 | 39.3 | ||||
| Return on capital employed % | 11.6 | 18.4 | ||||
| Free cash flow, MEUR | 61.8 | 71.2 | 64.0 | 101.6 | ||
| Average number of personnel during the period | 11,987 | 11,917 | 0.6 | |||
* The Board’s proposal to the AGM
President and CEO Pekka Lundmark:
“As expected, the fourth quarter was clearly the best quarter during the year 2013. We exceeded the previous year’s operating profit despite the fact that our sales were EUR 24 million lower than a year ago. This shows that our cost programs are delivering the expected results. Also, net working capital development was good, giving a strong cash flow in the quarter. As a whole, the year 2013 did not meet our targets. We delivered an excellent annual average growth of 14 percent during the years 2003-2012, but in 2013 we saw that growth come to a halt. The full-year result was behind our expectations due to the equipment business, even though our service business result continued to improve.
Our issue is now clearly the volume. Our cost-savings programs will continue in 2014, and there is further potential in project execution and supply chain management. As our cost base is developing in the right direction, any additional volume would now give very good leverage on the bottom line. But we are, of course, not only waiting for a market recovery to give us the growth. We are making significant investments in new product development and sales management systems with an aim to continue to increase our market share regardless of the economy that drives the market size development. We have recently launched several new exiting products, and there is more in the pipeline for the year 2014.”
BOARD OF DIRECTORS’ PROPOSAL FOR DISPOSAL OF DISTRIBUTABLE FUNDS
The parent company’s non-restricted equity is EUR 203,354,966.48, the net income of which for the year is EUR 61,701,102.44. The Group’s non-restricted equity is EUR 366,150,000.
According to the Finnish Companies Act, the distributable funds of the company are calculated based on the parent company’s non-restricted equity. For the purpose of determining the amount of the dividend, the Board of Directors has assessed the liquidity of the parent company and the economic circumstances subsequent to the end of fiscal year.
Based on such assessments the Board of Directors proposes to the Annual General Meeting that a dividend of EUR 1.05 be paid on each share and that the remaining non-restricted equity is retained in shareholders’ equity.
CORPORATE GOVERNANCE STATEMENT 2013
Konecranes complies with the Finnish Corporate Governance Code 2010 approved by the Board of the Securities Market Association. Konecranes has issued a Corporate Governance Statement based on the recommendation 54 of the Code, which is attached to this release in pdf format and can be reviewed on the corporate website of Konecranes at www.konecranes.com.
DISCLOSURE PROCEDURE
Konecranes follows the disclosure procedure enabled by Disclosure obligation of the issuer (7/2013) published by the Finnish Financial Supervision Authority. This stock exchange release is a summary of Konecranes Plc’s financial statements bulletin 2013. The complete report is attached to this release in pdf format and is also available on Konecranes’ website at www.konecranes.com.
ANALYST AND PRESS BRIEFING
An analyst and press conference will be held at restaurant Savoy’s Salikabinetti (address Eteläesplanadi 14) at 11.00 a.m., Finnish time. The 2013 financial statements will be presented by Konecranes’ President and CEO Pekka Lundmark and CFO Teo Ottola.
A live webcast of the conference will begin at 11.00 a.m. at www.konecranes.com. Please see the stock exchange release on January 15, 2014 for the conference call details.
KONECRANES PLC
Miikka Kinnunen
Director, Investor Relations
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 Miikka Kinnunen, Director, Investor Relations, tel. +358 20 427 2050
Mr Mikael Wegmüller, Vice President, Marketing and Communications, tel. +358 20 427 2008
Konecranes is a world-leading group of Lifting Businesses™, serving a broad range of customers, including manufacturing and process industries, shipyards, ports and terminals. Konecranes provides productivity-enhancing lifting solutions as well as services for lifting equipment and machine tools of all makes. In 2013, Group sales totaled EUR 2,100 million. The Group has 11,800 employees at 600 locations in 48 countries. Konecranes is listed on the NASDAQ OMX Helsinki (symbol: KCR1V).
DISTRIBUTION
NASDAQ OMX Helsinki
Media
www.konecranes.com