2010-02-03 11:30:00 CET
2010-02-03 11:31:36 CET
REGULATED INFORMATION
Cargotec - Financial Statement Release
Cargotec's Financial Statements Review 2009 - Year of streamlining operations and structural changes in a difficult market situation
Cargotec's Financial Statements Review 2009 - Year of streamlining operations
and structural changes in a difficult market situation
CARGOTEC CORPORATION, STOCK EXCHANGE RELEASE, 3 FEBRUARY 2010 AT 12:30 PM EET
The figures in this financial statements review are based on Cargotec
Corporation's audited 2009 Financial Statements.
Report highlights - year 2009
· Orders received totalled EUR 1,828 (3,769) million.
· Order book was EUR 2,149 (3,054) million at the end of the financial
period. The decline from the previous year was 30 percent.
· Sales were EUR 2,581 (3,399) million, which was 24 percent less
compared to 2008.
· Operating profit excluding restructuring costs was EUR 61.3 (192.8)
million, representing 2.4 (5.7) percent of sales.
· Operating profit was EUR 0.3 (173.7) million. Operating profit
includes EUR 61.1 (19.1) million in restructuring costs.
· Cash flow from operating activities before financial items and taxes
totalled EUR 289.7 (133.8) million.
· Net income for the period amounted to EUR 7.1 (120.8) million.
· Earnings per share were EUR 0.05 (1.91).
· The Board of Directors proposes a dividend of EUR 0.39 per class A
share and EUR 0.40 per class B share outstanding be paid.
Report highlights - fourth quarter
· Orders received totalled EUR 464 (633) million.
· Sales were EUR 669 (924) million.
· Operating profit excluding restructuring costs was EUR 31.7 (35.9)
million, representing 4.7 (3.9) percent of sales.
· Operating profit was EUR 7.4 (16.8) million. Operating profit includes
EUR 24.3 (19.1) million in restructuring costs.
Cargotec's President and CEO Mikael Mäkinen:"There were many positives in 2009 despite the difficult market situation.
Thanks to successful deliveries of marine cargo handling equipment we achieved
an excellent result in Marine business. Our cash flow strengthened throughout
the year. In addition, our streamlining of operations and development of our
supply set-up progressed as planned. I am satisfied with the EUR 32 million
underlying operating profit we reached in the fourth quarter and with
restructuring costs remaining smaller than anticipated in the same period, our
full year operating profit turned positive", affirms President and CEO Mikael
Mäkinen.
Press conference for analysts and media
A press conference for analysts and media will be combined with a live
international telephone conference and arranged on the publishing day at 2.00 pm
EET at Cargotec's head office, Sörnäisten rantatie 23, Helsinki. The event will
be held in English. The interim report will be presented by President and CEO
Mikael Mäkinen. The presentation material will be available on www.cargotec.com
by 2.00 pm EET.
The telephone conference, during which questions may be presented, can be
accessed at the following numbers ten minutes before the beginning of the event:
US callers +1 646 843 4608, non-US callers +44 20 3023 4412, access code
Cargotec Corporation.
The event can also be viewed as a live webcast at www.cargotec.com. An on-demand
audiocast of the conference will be published on Cargotec's website later during
the day.
A replay of the conference call will be available until 5 February 2010 3.00 pm
EET, in the following numbers: US callers +1 866 583 1039, non-US callers
+44 20 8196 1998, access code 136498#.
For further information, please contact:
Eeva Sipilä, CFO, tel. +358 204 55 4281
Paula Liimatta, IR Manager, tel.+358 204 55 4634
Cargotec improves the efficiency of cargo flows on land and at sea - wherever
cargo is on the move. Cargotec's daughter brands Hiab, Kalmar and MacGregor are
recognised leaders in cargo and load handling solutions around the world.
Cargotec's global network is positioned close to customers and offers extensive
services that ensure the continuous, reliable and sustainable performance of
equipment. Cargotec's sales totalled EUR 2.6 billion in 2009 and it employs more
than 9,500 people. Cargotec's class B shares are quoted on the NASDAQ OMX
Helsinki. www.cargotec.com <http://www.cargotec.com/>
Operating environment
Demand for load handling equipment was weak, significantly affected by the
marked fall in construction and new truck sales. With their fleets
under-utilised, customers are postponing investment decisions in the uncertain
economic situation. In some markets, low demand is feeding through as price
competition between equipment manufacturers. By the end of the year, demand in
customer segments other than those related to construction showed tentative
signs of recovery.
The number of containers handled in ports around the world dropped clearly in
2009. Lower usage rates of container handling equipment led to reductions in
replacement investments. Meanwhile, the uncertainty in the container handling
markets was reflected in the lengthening of customers' investment
decision-making processes. However, due to publicly funded infrastructure
projects, the Asia Pacific market area saw greater levels of activity than
elsewhere in the world. Demand for forklift trucks and terminal tractors was
lower than in the previous year, due to lower industrial production and
distribution centre activity.
The markets for marine cargo handling equipment contracted, following the end of
the ship ordering boom of the last few years, although some positive development
was visible in the offshore equipment market towards the end of the year.
Overcapacity in shipping has led to the idling of vessels, their use for storage
purposes and increased scrapping. Nevertheless, cancellations of orders for
marine cargo handling equipment have so far remained at moderate levels.
Partly idle equipment lowered demand for services. Lower cargo handling
equipment utilisation rates also affected spare parts sales. However, the
services markets are in better shape than the equipment markets.
Orders received and order book
Orders received in 2009 totalled EUR 1,828 (3,769) million, which was 51 percent
less than in the comparison period. It should also be noted that the order
intake during the comparison period 2008 was record-high in both Kalmar and
MacGregor. Orders received by MacGregor for EUR 175 million were cancelled from
the order book in 2009, and thereafter removed from the book. The value of the
orders secured during the fourth quarter was EUR 464 (633) million.
At the end of 2009, the order book totalled EUR 2,149 (3,054) million, 30
percent lower than in 2008. The management estimates that the order book
includes some EUR 300 million of orders placed with MacGregor bearing a risk of
cancellation.
Orders received by business area
+------------+---------+--+---------+--+--------+----------+----------+--------+
|MEUR |1-12/2009| %|1-12/2008| %|Change %|10-12/2009|10-12/2008|Change %|
+------------+---------+--+---------+--+--------+----------+----------+--------+
|Hiab | 525|29| 818|22| -36| 143| 157| -9|
+------------+---------+--+---------+--+--------+----------+----------+--------+
|Kalmar | 738|40| 1,566|41| -53| 162| 348| -53|
+------------+---------+--+---------+--+--------+----------+----------+--------+
|MacGregor | 569|31| 1,393|37| -59| 160| 129| 24|
+------------+---------+--+---------+--+--------+----------+----------+--------+
|Internal | -3| | -9| | | -1| -2| |
|orders | | | | | | | | |
+------------+---------+--+---------+--+--------+----------+----------+--------+
|Total | 1,828| | 3,769| | -51| 464| 633| -27|
+------------+---------+--+---------+--+--------+----------+----------+--------+
Hiab's orders received in 2009 accounted for EUR 525 (818) million, representing
36 percent less than the previous year. Hiab's share of orders received during
the fourth quarter was EUR 143 (157) million. A major part of the orders Hiab
secured were small individual orders, which is representative of its operations
in general. The biggest individual order was received in February, when Hiab
signed a contract for 292 loader cranes with BAE Systems Inc. in the US. Hiab's
order book at the end of the year, totalling EUR 119 (164) million, was 27
percent less than a year before.
Kalmar's orders received in 2009 totalled EUR 738 (1,566) million, which was 53
percent less than in the comparison period. Demand fell due to a clear drop in
the number of containers handled in the world's ports and faltering industrial
production. Orders received during the fourth quarter totalled EUR 162 (348)
million. Major agreements included E-One rubber-tyred gantry crane (RTG) orders
from Namibia, Portugal, Poland, Turkey and Vietnam, orders for two ship-to-shore
cranes (STS) from Latin America, an order for 20 shuttle carriers from Spain and
orders for terminal tractors from China, Tunis and Russia. In addition, orders
for more than 100 rough terrain container handlers were received from
Tank-Automotive Armament Command (TACOM), which is part of the US Department of
Defence. Cargotec Port Security, which is part of Kalmar, won its first
commercial contract for a spreader-mounted radiation detection system from the
US-based Lockheed Martin. Kalmar's order book at the end of 2009, totalling EUR
427 (704) million, was 39 percent lower than at the end of 2008.MacGregor's orders received in 2009 accounted for EUR 569 (1,393) million, 59
percent less than in 2008. Orders received during the fourth quarter totalled
EUR 160 (129) million. The drop in orders received reflected a strong slow-down
in the exceptional ship order boom of the last couple of years. However, other
market participants' delivery problems had a positive impact, with shipyards
seeking to secure their project schedules with MacGregor's help.
MacGregor received several important orders during the year. An order for hatch
covers to be installed on 10 bulk carriers was received from a South Korean
shipyard. Hatch covers for 32 container ships under construction in Japan and
South Korea and 30 cargo handling cranes and hatch covers for six container
ships under construction at a Chinese shipyard, will be delivered during
2010-2012. In addition, agreements were made for the delivery of 120 cargo
handling cranes destined for 32 bulk carriers under construction in China and
India, for two twin boom level luffing cargo handling cranes for the US Navy and
for specialist cargo handling systems for two logistics support vessels for the
Australian Navy. MacGregor also agreed on the delivery of six cranes for STX
Europe and of hatch covers for two new-generation heavy duty ships for a German
shipyard.
Significant orders for RoRo equipment were received from France, Germany,
Ireland, Japan, Jordan and Morocco. The order from Japan includes
electrically-driven RoRo equipment for two car carriers and the German order
RoRo systems for seven RoRo vessels.
MacGregor also received an order for 28 hose handling and provision cranes from
Korean shipyard Daewoo Shipbuilding & Marine Engineering Co. and an order for
selfunloading systems to be installed on two coastal cement carriers from a
Japanese company.
In December, a contract was signed to deliver a range of advanced offshore and
subsea load handling systems for a deepsea research vessel which will be built
at a Japanese shipyard. An active heave compensated offshore crane will be
delivered to a US customer during early 2010. Two knuckle-jib ship cranes will
be delivered and installed for a researched vessel under construction at a
Russian shipyard and one ship crane for an offshore vessel under construction in
Canada, also in early 2010. Moreover, in July, MacGregor won an order for a ship
unloader for handling coal from Brazil.
MacGregor's order book at the end of the financial period was EUR 1,604 (2,187)
million, which was 27 percent less than at the end of 2008. More than 60 percent
of the order book is bulk, general cargo and container ship related. Offshore
support vessel related orders comprise more than 10 percent of the order book.
The orders cancelled during the financial period, EUR 175 million, were removed
from the order book.
Services' market activity also declined compared to the previous year, but to a
smaller extent than in the equipment market. Although a large number of small
contracts typical of the services business were signed, customers are delaying
decision-making related to major contracts. Major service orders received during
the year included three-year service agreement renewal for all RoRo equipment
for 27 vessels from Grimaldi, refurbishment of 13 straddle carries for a
Tunisian port operator and five-year equipment servicing and maintenance
contract signed with an Albanian port operator.
Sales
Year 2009 sales declined 24 percent from the comparison period and totalled EUR
2,581 (3,399) million. Only deliveries of marine cargo handling equipment grew
from the previous year. In terms of sales, EMEA (Europe, Middle East, Africa)
was the largest market, its share declining to 46 (56) percent of consolidated
sales. The America's share of sales was 18 (16) and that of Asia Pacific 36 (28)
percent. Sales for the fourth quarter were EUR 669 (924) million.
Sales by business area
+------------+---------+--+---------+--+--------+----------+----------+--------+
|MEUR |1-12/2009| %|1-12/2008| %|Change %|10-12/2009|10-12/2008|Change %|
+------------+---------+--+---------+--+--------+----------+----------+--------+
|Hiab | 568|22| 907|27| -37| 152| 216| -29|
+------------+---------+--+---------+--+--------+----------+----------+--------+
|Kalmar | 1,008|39| 1,515|44| -34| 213| 413| -48|
+------------+---------+--+---------+--+--------+----------+----------+--------+
|MacGregor | 1,009|39| 985|29| 2| 305| 298| 2|
+------------+---------+--+---------+--+--------+----------+----------+--------+
|Internal | -4| | -8| | | -1| -3| |
|sales | | | | | | | | |
+------------+---------+--+---------+--+--------+----------+----------+--------+
|Total | 2,581| | 3,399| | -24| 669| 924| -28|
+------------+---------+--+---------+--+--------+----------+----------+--------+
Hiab's sales in 2009 totalled EUR 568 (907) million, which was 37 percent less
than in the previous year. Sales were on a low level all year, reflecting the
general weakness in the load handling equipment market. Fourth quarter sales
were EUR 152 (216) million.
Kalmar's sales in 2009 totalled EUR 1,008 (1,515) million. The decline from the
previous financial period was 34 percent. In the second half of 2009, delivery
volumes saw a clear drop due to a low order intake which continued throughout
the year. Fourth quarter sales were EUR 213 (413) million.
MacGregor's sales 2009 totalled EUR 1,009 (985) million. Growth was two percent
from 2008. This sales growth was the result of the strong order intake in
previous years and successful project deliveries. Fourth quarter sales were EUR
305 (298) million.
Services sales during the financial period amounted to EUR 690 (871) million,
representing 27 (26) percent of total sales. Sales from services declined 21
percent from the comparison period level, which is a consequence of lower demand
in all areas of the services business. Services accounted for 30 (23) percent of
sales at Hiab, 33 (29) percent at Kalmar and 19 (23) percent at MacGregor.
Financial result
The operating profit for 2009 weakened from 2008, totalling EUR 0.3 (173.7)
million. Operating profit includes EUR 61.1 (19.1) million in restructuring
costs. EUR 26.8 (14.1) million of the restructuring costs are related to Hiab,
EUR 16.4 (4.5) million to Kalmar and EUR 1.9 (-) million to MacGregor. In
addition, a total of EUR 15.9 (0.3) million in write-offs and personnel-related
restructuring costs were booked at corporate level.
Operating profit in 2009, excluding restructuring costs, was EUR 61.3 (192.8)
million, representing 2.4 (5.7) percent of sales. This includes a EUR 4.8 (8.3)
million cost impact for the purchase price allocation treatment of acquisitions
and EUR 12.2 (9.4) million costs from the On the Move change programme.
Operating profit in 2009 for Hiab, excluding restructuring costs, was EUR -35.0
(49.4) million, EUR 24.6 (89.6) million for Kalmar and EUR 105.2 (83.6) million
for MacGregor.
Fourth quarter operating profit totalled EUR 7.4 (16.8) million. The operating
profit includes EUR 24.3 (19.1) million in restructuring costs. Operating profit
for the fourth quarter, excluding restructuring costs, was EUR 31.7 (35.9)
million, representing 4.7 (3.9) percent of sales. Fourth quarter operating
profit, excluding restructuring costs, totalled EUR -5.7 (3.7) million for Hiab,
EUR 3.5 (12.1) million for Kalmar and EUR 40.5 (30.7) million for MacGregor.
MacGregor's profitability improved during each quarter. Hiab's and Kalmar's
operating profit was eroded by low production capacity utilisation. During the
first half of the year, the product profitability of deliveries was weakened by
material costs, which were still at the previous high price levels. However,
towards the end of the financial period, the decrease in material prices began
to have a positive impact. In addition, costs savings from significant
restructuring measures totalled EUR 90 million during the year.
Net financing expenses were EUR 27.0 (61.9) million in 2009.
Net income in 2009 was EUR 7.1 (120.8) million and earnings per share EUR 0.05
(1.91).
Balance sheet, cash flow and financing
The consolidated balance sheet total was EUR 352 million lower at EUR 2,687
million than at the end of 2008. Equity at the end of 2009 was EUR 871 (855)
million representing EUR 14.20 (13.95) per share. Return on equity (ROE) was
0.8 (13.7) percent, return on capital employed (ROCE) 0.2 (12.7) percent and the
total equity/total assets ratio 37.5 (33.0). Tangible assets on the balance
sheet were EUR 301 (284) million and intangible assets EUR 784 (754) million.
Cash flow from operating activities before financial items and taxes in 2009 was
EUR 290 (134) million. Cash flow was positively affected by the fall of EUR 201
million during the year in net working capital. At the end of 2009, net working
capital was EUR 123 (324) million. This fall was due to shrunken component and
materials inventories and lower receivables. In addition, at the beginning of
2009, the balance sheet showed a significant amount of work-in-progress, which
healthy early-year delivery volumes within Kalmar and MacGregor have reduced.
Cargotec's liquidity is healthy. The dividend payment totalled EUR 37.4 (66.0)
million.
Net debt at year-end was EUR 335 (478) million, including EUR 612 (565) million
in interest-bearing debt. Gearing was 38.0 (55.3) percent.
Cargotec's financing structure is healthy. Interest-bearing debt consists mainly
of long-term corporate bonds maturing from the year 2012. In order to strengthen
its financial structure, Cargotec raised a total of EUR 100 million as five-year
Pension Premium Loans (TyEL) in March and June 2009. In addition, Cargotec had
EUR 585 million of unused long-term credit facilities at the end of the
financial period.
New products and product development
Research and product development expenditure in 2009 was EUR 36.5 (47.0)
million, representing 1.4 (1.4) percent of sales. Despite the weak market
situation, Cargotec continues to invest in product development.
During the financial period, Hiab introduced a new medium range loader crane
specially designed for the construction industry, and several new products in
the small crane product family. In addition, Hiab launched its first stiff boom
crane for the Chinese market. Furthermore, a new 30-tonne demountable and three
new hooklifts were introduced in Hiab's demountable product family. The safety
of Hiab cranes was enhanced in order to fulfil the new Machine Directive
2006/42/EC in Europe, which entered into force in December 2009.
During the financial period, Kalmar continued its product development and
introduced several new products improving energy efficiency in particular. A new
streamlined reachstacker ensures cost-effective and flexible container handling
for medium capacity ports. Due to the new technology used in Kalmar's electrical
shuttle carriers, this equipment features reduced fuel consumption and lower
emissions. Moreover, the all-electric rubber-tyred gantry crane (RTG) was
further improved with several safety and environmental features. Additionally,
three new hybrid terminal tractors for technology trials were supplied to the
Port of Long Beach, US. Kalmar also launched a customised automation platform
for the management of container handling equipment fleet in ports and terminals
and a new heavy range terminal tractor for LoLo (lift-on, lift-off) operations.
The tractor has been designed in close co-operation with customers and meets the
strictest requirements for ergonomics and driveability, energy-efficiency as
well as environmental friendliness.
During the first half, Kalmar finalised performance testing related to the
development of its automatic stacking crane system in the Hamburg CTB terminal.
The automatic stacking crane meets German requirements for security systems.
Integration testing with the customer's terminal system will continue in 2010.
In addition, Kalmar prepared the commencement of ship-to-shore crane production
in Asia. At the same time, Kalmar changed its cranes to enable easier final
assembly at the customer's site. This makes their transportation simpler and
less expensive. New Kalmar ship-to-shore cranes will be delivered with a novel
crane control system featuring the crane's control, crane management and fault
diagnostics.
In November, an electric drive innovation MacRack was introduced to simplify the
operation of MacGregor side-rolling hatch covers.
In May, MacGregor introduced an innovative ultra-deepwater lifting system, which
includes a side-mounted hang-off frame for the transfer of loads from a
steel-rope winch fitted standard crane, to vertically suspended fibre ropes.
This development is a continuation of the January delivery of the first subsea
knuckle-jib crane equipped with an option for fibre rope handling. Technology
for handling lightweight fibre rope rather than traditional steel wire rope
offers several advantages: much heavier loads can be handled without placing a
strain on the crane at unlimited depths and, consequently, overall safety is
improved due to lighter equipment still capable of carrying out heavy work
operations.
Capital expenditure
Capital expenditure for the financial period, excluding acquisitions and
customer financing, totalled EUR 87.8 (76.8) million. Investments in customer
financing were EUR 19.0 (35.9) million. Depreciation for 2009 amounted to EUR
58.7 (57.4) million.
Cargotec made the decision to proceed with an investment plan for a
multi-assembly unit (MAU) in Stargard Szczecinski in Northern Poland, to improve
its global supply footprint. This new MAU is intended to support the production
of a wide range of Cargotec equipment. Production began in rented premises at
the end of the third quarter. Production in Cargotec's own premises at a new
site is planned for the second quarter of 2010. The cash flow impact of the
investment cost was EUR 19.1 million in 2009.
The expansion of container spreader production capacity in Malaysia was
finalised during the fourth quarter. The new factory for rough terrain container
handlers in Texas, USA, started production. In addition, the capacity expansion
investment in Narva, Estonia and the doubling of production capacity in
Shanghai, China, were finalised during the first half of 2009.
On the Move change programme
In January 2008, Cargotec announced the launch of an extensive On the Move
change programme. This change programme was intended to form a basis for
profitable growth through improved customer focus and efficiency. Of the
programme's estimated EUR 80-100 million savings target, half will result from
non-volume related cost-structure adjustments and supply set-up changes and has
been included in an overall cost savings estimate exceeding EUR 150 million. The
materialisation of the other, volume-related half of the original On the Move
savings target will require an improvement in the market situation. This
stand-alone change programme was concluded at the end of the year. Ongoing
issues were transferred to operative areas of responsibility.
The projects in the first phase focused on streamlining support functions and
the company structure as well as initiating information management (IM) projects
for the improvement of efficiency. Changes in company structure were to a large
extent finalised during the year. IM projects will continue in 2010.
At the beginning of 2009, Cargotec established a common Supply organisation,
responsible for sourcing and supply and which is developing global supply closer
to customers as well as steering such operations towards lower cost
environments. During 2009, Cargotec implemented a major change in its supply
footprint. In 2008, the decision was taken to close a factory in the USA and
Finland. Further, similar decisions were taken during the year 2009, affecting
factories in Indonesia, the Netherlands and Sweden. As a consequence of these
factory closures and in order to enhance efficiency, the operations and capacity
utilisation of the remaining factories will be developed.
As part of the On the Move change programme, Cargotec merged Hiab and Kalmar
business areas globally. The resulting new business area, Industrial and
Terminal, comprising Hiab and Kalmar business areas, began operating at the
beginning of October while financial reporting continued according to previous
structure until year-end. The new Industrial and Terminal organisation includes
Product Solutions, charged with ensuring the competitiveness of the global
product offering, Service Solutions with responsibility for ensuring the
competitiveness of the global service offering and three regional organisations
with responsibility for sales and service: Americas, Asia-Pacific and EMEA.
Acquisitions and disposals
During the financial period, Cargotec completed two acquisitions. In December,
Cargotec acquired the port service and equipment related part of Moroccan
Société Maghrepic S.A.'s business operations. Maghrepic has been Cargotec's
dealer representative in Morocco and has long experience of service and spare
parts. According to the deal, Cargotec employed 44 persons, most of whom are
service technicians. In August, Cargotec acquired the assets of a Danish sales
and services company Arne Holst & Co. A/S. This acquisition included the
takeover of business assets and customer contacts as well as the transfer of
four employees to Cargotec. In addition, Cargotec acquired an 18 percent
minority holding in Kalmar España S.A. and 20 percent minority holdings in
Italian Officine Cargotec Ferrari Genova S.r.l and Officine Cargotec Ferrari
Prato S.r.l. as well as in Australian Hiab Australia Pty Ltd. Subsequent to
these transactions, Cargotec owns all shares in the companies.
In November, Cargotec agreed on the termination of the 2006 signed cooperation
agreement with the Chinese company Goodway. The cooperation agreement will be
terminated in early 2010.
In October, Cargotec agreed to transfer its off-road forestry cranes business to
the Finnish Mesera Salo Oy. The transfer agreement also included stationary
mounted off-road crane models. As part of the deal, some key employees in the
off-road crane business transferred to Mesera. The real estate related to the
business and located in Salo, Finland, was sold to the Finnish Rakennus-Järvi Oy
in December.
Personnel
Cargotec employed 9,606 (11,826) people at the end of the year, 2,220 fewer than
at the end of 2008. Due to restructuring measures, the number of personnel
declined most in Sweden and Finland. Hiab employed 3,127 (4,308) people, Kalmar
3,862 (4,766), and MacGregor 2,286 (2,577). The average number of employees in
2009 was 10,785 (11,777). Part-time personnel represented 3 (3) percent of
employees. 16 (15) percent of the personnel were female and 84 (85) percent
male. The number of personnel in corporate level support functions increased due
to the establishment of Cargotec's shared service centre as well as common
supply and country organisations.
At the end of 2009, 19 (20) percent of Cargotec's total employees were located
in Sweden, 11 (13) percent in Finland and 30 (30) percent in the rest of Europe.
North and South American personnel represented 11 (11) percent, Asia Pacific 26
(24) percent and the rest of the world 2 (2) percent of total employees.
Salaries and remunerations to employees totalled EUR 351 (387) million for the
financial period.
During the year, all of Cargotec's human resources (HR) policies were revised.
These policies contain provisions on the HR principles and practices as well as
recruitment, internal transfers, training, performance management, foreign
assignments, management contracts, compensation and rewarding, job titles, and
respect for the employee in the workplace. HR policies are updated annually and
are implemented in Cargotec's operating countries through its global HR
management network.
A dramatic change in Cargotec's operating model characterised 2009. Focus areas
in human resources management had to be adjusted to the rapidly changing
circumstances. The key objective was to offer strong global support for change
management.Adjusting capacity to demand and other restructuring measures
In September 2008, capacity adjustment measures were begun, mainly in Western
Europe and North America, due to the fall in demand and profitability. During
2009, these measures were extended to Cargotec units all over the world, with
the goal of improving the company's profitability and securing its
competitiveness.
Adjustment measures began with reductions in temporary employees and
subcontractors. During 2009, as part of a long-term plan, Cargotec implemented a
major transformation of its production set-up. The decision taken in 2008 to
close a factory in the United States and Finland was followed in 2009 by
closures in the Netherlands, Indonesia and Sweden. Alongside employee dismissals
due to these factory closures, other units saw permanent employee reductions. In
addition, temporary lay-offs or shorter working weeks were implemented in
several production units, in line with the flexibility possible under local
legislation.
As part of the On the Move change programme, Cargotec decided to merge Hiab and
Kalmar business areas throughout the world. The elimination of overlaps led to
employee reductions in several units.
Cargotec also began planning the conversion of the Tampere unit into a
competence and technology centre, which will improve the worldwide
competitiveness of the company's products. The plan is to shift the operational
focus from traditional production to a developer of new products and concepts
and an enabler of serial production. In the wake of this almost three-year
process of transformation, it is estimated that the Tampere unit will employ
around 250 people in place of the current 550.
Due to capacity adjustment and other restructuring measures, the number of
employees had fallen by the end of 2009 by 2,867: 1,497 in Hiab, 1,079 in
Kalmar, 281 in MacGregor and 10 in group administrative functions. In Sweden
there were employee reductions of 595, plus 550 in Finland and a total of 1,722
in other countries. During the first half of 2010, it is estimated that
approximately 400 people will leave the company as a result of already initiated
restructuring measures.
It is estimated that already completed and ongoing restructuring initiatives,
including structural capacity adjustment measures, will create total annual cost
savings exceeding EUR 150 million. This savings estimate includes all cost
structure streamlining actions announced since the beginning of 2008. By the
year end, the running rate of savings achieved was EUR 140 million.
Environment
The environmental principles are specified in Cargotec's environmental policy.
Cargotec's operations, in other words its assembly plants, service units and
offices, mainly have local impacts while the most significant environmental
impacts globally are generated through the use of Cargotec's equipment. Further
environmental impacts are the result of material deliveries associated with
Cargotec's operations, and of business travel.
Cargotec has introduced a corporate-wide environmental key performance indicator
(KPI) monitoring system. International standards were applied when creating the
system. At the moment, the related monitoring covers 16 assembly plants and nine
other units. The KPIs are published on Cargotec's website annually.
Environmental impact assessment is repeated in line with a standard procedure
every time operations are affected by major changes such as mergers or
acquisitions, or when entirely new operations are launched. Environmental impact
assessment involves an analysis of the local impacts of the units' operations on
soil, water systems, the natural environment and the atmosphere. In 2009, the
most significant environmental impact assessment was conducted in the vicinity
of a plant being constructed in Poland.
Internal control and risk management
The key task of internal control is to ensure that management decisions are
implemented across the organisation, that operations run efficiently and that
business-related decision making is sound and appropriate. Internal control is
also responsible for ensuring that risk management efforts are adequate and that
personnel comply with company policies as well as non-company regulations and
laws.
Cargotec's Board of Directors has approved the Company's risk management
policy. A core principle is preventive action for identifying, assessing and
handling risks and, if they materialise, treating them effectively. The
President and CEO and the Executive Board are responsible for the methods,
implementation and supervision of risk management, and report on these to the
Board of Directors. Risk management is spread across business areas and units.
Each unit is responsible for assigning responsibility for risk management and
identifying, managing and reporting risks. The Corporate Risk Management
function is responsible for the overall development of risk management,
supported by corporate-wide risk management principles, practices and risk
reports. Financial risks are centrally managed by the Corporate Treasury.
Strategic and business risks are related to business cycles in the world economy
and Cargotec's customer sectors, the availability of raw materials and
components and the related price trends, mergers and acquisitions, and the
operations of dealers and subcontractors. The company prepares for them by
signing long term delivery agreements and seeking alternative suppliers.
Cargotec requires that the companies in its supply chain are familiar with
Cargotec's risk management principles and practices, and follow similar
principles. Risk management guidelines and instructions on self-assessment have
been drafted for suppliers and subcontractors.
Operational risks relate to persons, property, processes, products, information
technology and practices. The materialisation of operational risks may result in
bodily injuries, property damage, business interruptions or product liability
claims. First and foremost, Cargotec's main operational risk management
measures involve better product safety and business processes in order to ensure
business continuity. With respect to key person risks, succession plans for
leadership and key assignments are updated on an annual basis for the purpose of
ensuring continuity in operations.
Main hazard risks include risks related to personnel, property, business
interruptions and logistics. In addition to preventive risk management measures,
the company protects itself against these risks by taking out global insurance
policies covering all units.
Efforts to develop the risk management system will continue in accordance with
the Company's risk management policy.
Changes in the organisation and management
In June 2009, Cargotec announced the merger of Hiab and Kalmar business areas.
As a result, two business areas were formed: Marine, comprising former MacGregor
business area, and Industrial and Terminal, which comprises former Hiab and
Kalmar business areas. Olli Isotalo continues to head the Marine business while
Pekka Vauramo heads the Industrial and Terminal business. Pekka Vauramo is also
continuing in his role as Deputy to CEO. These changes did not affect Cargotec's
external financial reporting in 2009. As of 1 January 2010, Cargotec will report
in two reporting segments Industrial and Terminal, and Marine.
The new Industrial and Terminal organisation includes Product Solutions, charged
with ensuring the competitiveness of the global product offering, Service
Solutions with responsibility for ensuring the competitiveness of the global
service offering and three regional organisations with responsibility for sales
and service: EMEA, Americas, Asia Pacific.
Unto Ahtola was appointed Executive Vice President, Product Solutions, and a
member of Cargotec's Executive Board. He joined Cargotec on 2 November 2009.
Stefan Gleuel, formerly Senior Vice President, MacGregor Service Division, was
appointed Executive Vice President, Service Solutions as of 1 October 2009, and
a member of Cargotec's Executive Board.
Harald de Graaf was appointed Executive Vice President, EMEA, as of 1 July
2009. He continues as a member of Cargotec Executive Board. Ken Loh was
appointed Executive Vice President, Asia Pacific and a member of Cargotec's
Executive Board as of 1 October 2009. Mr Loh's previous post was President,
Kalmar Asia Pacific Region. As of 1 October 2009, Lennart Brelin was appointed
Executive Vice President, Americas and a member of Cargotec's Executive Board.
Lennart Brelin worked previously as Senior Vice President, Hiab Americas region.
Kirsi Nuotto, a member of Cargotec's Executive Board, was appointed Executive
Vice President, Human Resources and Communications as of 1 July 2009.
New branding strategy
Cargotec defined a new corporate-wide branding strategy and launched a new
visual image, aimed at strengthening the Cargotec name and its main strategic
brands Hiab, Kalmar and MacGregor. The new brand strategy supports Cargotec's
'One Company' approach and is built on the strong reputation of its market-
leading brands.
Cargotec itself is more visibile in the common, new visual identity of these
brands: they all share a common symbol, the elephant. The Cargotec elephant will
be displayed on most materials together with the three main brands, Hiab, Kalmar
and MacGregor. These three brands all have a strong reputation within Cargotec's
customer base and, in the future, products will continue to be branded with
these names.
Annual General Meeting
Decision taken at Cargotec Corporation's Annual General Meeting
Cargotec Corporation's Annual General Meeting (AGM) was held on 5 March 2009 in
Helsinki. The AGM approved the financial statements and consolidated financial
statements and granted discharge from liability to the President and CEO and the
members of the Board of Directors for the accounting period 1 January-31
December 2008.
The AGM approved a dividend of EUR 0.59 per class A share and EUR 0.60 per class
B share outstanding be paid.
The number of the members of the Board of Directors was confirmed at six. Tapio
Hakakari, Ilkka Herlin, Peter Immonen, Karri Kaitue and Antti Lagerroos were
re-elected to the Board of Directors. Anja Silvennoinen was elected as a new
member to the Board of Directors. The meeting decided that a yearly remuneration
of EUR 80,000 be paid for the Chairman, EUR 55,000 for the Deputy Chairman and
EUR 40,000 for the other Board members. In addition, it was decided that members
receive EUR 500 for attendance at Board and Committee meetings and that 30
percent of the yearly remuneration will be paid in Cargotec Corporation's class
B shares and the rest in money.
Authorised public accountants Johan Kronberg and PricewaterhouseCoopers Ltd were
re-elected as auditors.
Authorisations granted by the Annual General Meeting
The AGM authorised the Board of Directors to decide on purchasing of own shares
with non-restricted equity. The shares may be repurchased in order to develop
the capital structure of the Company, to finance or carry out possible
acquisitions, to implement the Company's share-based incentive plans, to be
transferred for other purposes or to be cancelled. Altogether no more than
6,400,000 own shares may be repurchased, of which no more than 952,000 are class
A shares and 5,448,000 are class B class. The above mentioned amounts include
the 2,990,725 class B shares repurchased during 2005-2008 in the Company's
possession on the AGM date.
In addition, the AGM authorised the Board to decide on issuance of a maximum of
6,400,000 treasury shares, of which no more than 952,000 are class A shares and
5,448,000 are class B shares, in one or more lots. The share issue can be
directed and it is to be used to as compensation in acquisitions and in other
arrangements, to finance acquisitions or for personnel incentive purposes.
Both authorisations shall remain in effect for a period of 18 months from date
of decision of the AGM.
Organisation of the Board of Directors
The Board of Directors elected Ilkka Herlin to continue as Chairman of the
Board. Tapio Hakakari was elected as Deputy Chairman. Cargotec's Senior
Executive Vice President Kari Heinistö continues to act as secretary of the
Board of Directors.
The Board of Directors decided that the Audit Committee and Nomination and
Compensation Committee continue to assist the Board in its work. The Board of
Directors elected among its members Ilkka Herlin, Karri Kaitue (chairman) and
Anja Silvennoinen as members of the Audit Committee. Tapio Hakakari, Ilkka
Herlin (chairman), Peter Immonen and Antti Lagerroos were elected to the
Nomination and Compensation Committee.
Shares and trading
Share capital
Cargotec's share capital on 31 December 2009 totalled EUR 64,304,880. The share
capital increased by EUR 600 due to share subscriptions with Cargotec 2005B
option rights during the financial period. On 31 December 2009, the number of
class B shares listed on the NASDAQ OMX Helsinki was 54,778,791 while that of
unlisted class A shares totalled 9,526,089. Class B shares accounted for 85.2
(85.2) percent of the total number of shares and 36.5 (36.5) percent of votes.
Class A shares accounted for 14.8 (14.8) percent of the total number of shares
and 63.5 (63.5) percent of votes. The total number of votes attached to all
shares was 15,002,624 (15,002,744).
Own shares
At the end of 2009, Cargotec held a total of 2,959,487 own class B shares, which
corresponds to 4.60 percent of the total number of shares and 1.97 percent of
votes. The shares were repurchased in 2005-2008.
The Board of Directors decided to exercise the authorisation conferred by the
AGM held on 5 March 2009, to acquire own shares. In accordance with this
authorisation, the shares may be repurchased in order to develop the capital
structure of the Company, to finance or carry out possible acquisitions, to
implement the Company's share-based incentive plan, to be transferred for other
purposes or to be cancelled. No own shares were repurchased in 2009.
Share-based incentive programme - issue of own shares as reward
On 5 March 2009, the Board of Directors decided on a directed bonus issue of
31,356 class B shares owned by the Company to the 61 participants in the
Company's share-based incentive programme as a reward for the earnings period
2007-2008. A total of 118 class B shares were returned to the Company, entailing
a directed bonus issue of 31,238 class B shares. The decision in favour of a
directed bonus issue is based on the authorisation of the AGM of Shareholders
held on 5 March 2009. The maximum amount to be paid out as shares from the
incentive programme during 2007-2011 is 387,500 class B shares.
Option rights
The Company has no valid option programme. The subscription period with 2005B
option rights ended on 31 March 2009. A total of 333,570 Cargotec class B shares
were subscribed under 2005B option rights during the subscription period. After
the end of the subscription period, the unused option rights became null and
void and have been removed from their holders' book-entry accounts.
Market capitalisation and trading
At the end of 2009, the total market value of class B shares was EUR 1,001
million, excluding treasury shares held by the Company. The year-end market
capitalisation, in which unlisted class A shares are valued at the average price
of class B shares on the last trading day of the year, was EUR 1,183 million,
excluding treasury shares held by the Company.
The class B share closed at EUR 19.31 on the year end. The average share price
in 2009 was EUR 11.55, the highest quotation being EUR 19.31 and the lowest EUR
6.37. The share value increased 139 percent during the year. In 2009,
approximately 55 million class B shares were traded on the NASDAQ OMX Helsinki,
corresponding to a turnover of approximately EUR 630 million. The average daily
trading volume of class B shares was 218,255 shares or EUR 2,509,293.
Short-term risks and uncertainties
Despite signs of recovery in the world economy and financial markets, economic
trends are still characterised by uncertainty. Similar uncertainty surrounds the
development of demand for Cargotec's products and services, and the willingness
of its customers to invest, during 2010.
The uncertain market situation may continue to lead to the deferment of
investment decisions or the postponement or cancellation of orders. Furthermore,
customers' financial situations will affect the collection of receivables and
the level of credit loss. The weak market situation is also burdening suppliers
and sub-contractors, which may have a knock-on effect on Cargotec's supply
chain.
Cargotec estimates that approximately EUR 300 million of the order book at the
beginning of 2010 involves a risk of cancellation. A continuation in shipping
overcapacity may lead to a reappraisal by ship owners of the need to cancel
ordered vessels.
Events after the reporting period
In January 2010, Cargotec sold its US-based hydraulic cylinders manufacturing
business Waltco Hydraulics to Ligon Industries, LLC. Waltco Hydraulics, situated
in Ohio, was part of Waltco Lift Corp. belonging to the Industrial and Terminal
business area at Cargotec. Waltco Hydraulics employed 25 people.
In January 2010, Cargotec announced that its Executive Board is renewed. The
Executive Board consists of the following members: Mikael Mäkinen, President and
CEO; Pekka Vauramo, Deputy to CEO and Senior Executive Vice President,
Industrial and Terminal business area; Olli Isotalo, Executive Vice President,
Marine business area; Axel Leijonhufvud, Executive Vice President, Supply; Eeva
Sipilä, Executive Vice President, Chief Financial Officer; Kirsi Nuotto,
Executive Vice President, HR and Communications; Matti Sommarberg, Executive
Vice President, Chief Technology Officer; Harald de Graaf, Executive Vice
President, EMEA region; Ken Loh, Executive Vice President, Asia Pacific region;
Lennart Brelin, Executive Vice President, Americas region; Unto Ahtola,
Executive Vice President, Product Solutions, I&T and Stefan Gleuel, Executive
Vice President, Service Solutions, I&T.
Senior Executive Vice President Kari Heinistö and Executive Vice President of
Hiab business area Pekka Vartiainen will leave the Executive Board. Kari
Heinistö will join a new employer as of 1 April 2010. Pekka Vartiainen will
develop a common way of working towards Cargotec's defence business customers.
Board of Directors' proposal on the distribution of profit
The parent company's distributable equity on 31 December 2009 was EUR
875,129,857.79 of which net income for the period was EUR -48,369,672.04. The
Board of Directors proposes to the AGM convening on 5 March 2010, that of the
distributable profit, a dividend of EUR 0.39 for each of the 9,526,089 class A
shares and EUR 0.40 for each of the 51,819,304 outstanding class B shares be
paid, totalling EUR 24,442,896.31. The remaining distributable equity, EUR
850,686,961.48 will be retained and carried forward.
No significant changes have occurred in the Cargotec's financial position after
the end of the financial year. Liquidity is good and, in the Board of Director's
view, the proposed distribution of dividend poses no risk to the Company's
financial standing.
Outlook
There are tentative positive signs visible in the order intake for industrial
business. Uncertainty continues in port terminal business. Based on the strong
order book, sales in marine cargo handling business are expected to remain on a
healthy level in 2010. Cargotec's 2010 sales are estimated to be on 2009 level
and operating profit to exceed EUR 100 million. It is estimated that still a few
million euro in restructuring costs from currently ongoing restructuring
measures will be booked during early-2010.
Annual General Meeting 2010
Cargotec Corporation's Annual General Meeting will be held at the Marina
Congress Center in Helsinki on 5 March 2010 at 11.00 am EET.
Financial calendar 2010
Interim Report January-March 2010, on Thursday, 29 April 2010
Interim Report January-June 2010, on Wednesday, 21 July 2010
Interim Report January-September 2010, on Wednesday, 27 October 2010
Cargotec Corporation will publish its Corporate Governance Statement 2009 on
week 6 together with the 2009 Annual Report. The statement will be published
separately from the Board of Directors' report and it will be available after
publishing on Cargotec's website www.cargotec.com.
Helsinki, 3 February 2010
Cargotec Corporation
Board of Directors
Consolidated Statement of Income
MEUR 10-12/2009 10-12/2008 1-12/2009 1-12/2008
--------------------------------------------------------------------------------
Sales 668.6 923.5 2,580.9 3,399.2
Cost of goods sold -546.6 -763.8 -2,158.7 -2,762.5
--------------------------------------------------------------------------------
Gross profit 122.1 159.7 422.2 636.7
Gross profit, % 18.3 % 17.3 % 16.4 % 18.7 %
Other operating income 12.5 15.0 42.7 39.1
Selling and marketing
expenses -32.5 -49.4 -144.5 -189.9
Research and development
expenses -9.2 -13.2 -34.4 -43.6
Administration expenses -42.2 -58.7 -179.0 -212.0
Restructuring costs -24.3 -19.1 -61.1 -19.1
Other operating expenses -19.8 -18.1 -46.5 -38.0
Share of associated
companies' and joint
ventures' net income 0.9 0.5 0.8 0.6
--------------------------------------------------------------------------------
Operating profit 7.4 16.8 0.3 173.7
Operating profit, % 1.1 % 1.8 % 0.0 % 5.1 %
Financing income 3.4 1.8 14.5 16.0
Financing expenses -10.4 -15.2 -41.6 -44.5
--------------------------------------------------------------------------------
Income before taxes 0.5 3.4 -26.7 145.2
Income before taxes, % 0.1 % 0.4 % -1.0 % 4.3 %
Taxes 12.5 5.6 33.9 -24.4
--------------------------------------------------------------------------------
Net income for the period 13.0 9.0 7.1 120.8
--------------------------------------------------------------------------------
Net income for the period,
% 1.9 % 1.0 % 0.3 % 3.6 %
Net income for the period
attributable to:
Equity holders of the
Company 11.3 8.5 3.1 118.4
Minority interest 1.7 0.4 4.0 2.4
--------------------------------------------------------------------------------
Total 13.0 9.0 7.1 120.8
--------------------------------------------------------------------------------
Earnings per share for profit attributable to the equity holders of the
Company:
Basic earnings per share,
EUR 0.18 0.14 0.05 1.91
Diluted earnings per
share, EUR 0.18 0.14 0.05 1.91
Consolidated Statement of Comprehensive Income
--------------------------------------------------------------------------------
10-12/2009 10-12/2008 1-12/2009 1-12/2008
--------------------------------------------------------------------------------
Net income for the period 13.0 9.0 7.1 120.8
Gain/loss on cash flow
hedges -10.5 -67.8 6.9 -131.1
Gain/loss on cash flow
hedges transferred to
Statement of Income 1.1 30.6 36.2 29.2
Translation differences 6.9 0.7 20.5 9.8
Taxes relating to components
of other comprehensive
income 0.6 10.8 -14.6 27.9
--------------------------------------------------------------------------------
Comprehensive income for the
period 11.1 -16.8 56.1 56.6
--------------------------------------------------------------------------------
Comprehensive income for the
period attributable to:
Equity holders of the
Company 9.8 -18.2 52.1 53.2
Minority interest 1.4 1.4 4.0 3.4
--------------------------------------------------------------------------------
Total 11.1 -16.8 56.1 56.6
--------------------------------------------------------------------------------
Consolidated Statement of Financial Position
MEUR 31 Dec 2009 31 Dec 2008
--------------------------------------------------------------------------------
ASSETS
Non-current assets
Goodwill 689.6 669.2
Other intangible assets 94.7 85.0
Property, plant and equipment 301.2 283.5
Investments in associated companies and joint
ventures 7.5 7.0
Available-for-sale investments 1.5 2.0
Loans receivable and other interest-bearing assets
1) 7.4 7.7
Deferred tax assets 113.9 97.2
Derivative assets 9.1 55.0
Other non-interest-bearing assets 8.0 8.1
--------------------------------------------------------------------------------
Total non-current assets 1,233.0 1,214.6
Current assets
Inventories 609.3 881.9
Loans receivable and other interest-bearing assets
1) 2.9 0.2
Income tax receivables 30.6 18.5
Derivative assets 38.8 130.4
Accounts receivable and other non-interest-bearing
assets 506.1 714.0
Cash and cash equivalents 1) 266.6 79.2
--------------------------------------------------------------------------------
Total current assets 1,454.5 1,824.3
--------------------------------------------------------------------------------
Total assets 2,687.4 3,038.9
1) Included in interest-bearing net debt
MEUR 31 Dec 2009 31 Dec 2008
--------------------------------------------------------------------------------
EQUITY AND LIABILITIES
Equity attributable to the equity
holders of the Company
Share capital 64.3 64.3
Share premium account 98.0 98.0
Translation differences -1.1 -20.4
Fair value reserves -24.9 -54.5
Retained earnings 734.6 768.0
--------------------------------------------------------------------------------
Total equity attributable to the
equity holders of the Company 870.8 855.3
Minority interest 10.6 9.1
--------------------------------------------------------------------------------
Total equity 881.5 864.4
Non-current liabilities
Loans 1) 511.2 440.2
Deferred tax liabilities 29.7 43.0
Pension obligations 37.8 33.5
Provisions 19.0 34.6
Derivative liabilities 28.4 84.5
Other non-interest-bearing
liabilities 28.6 26.6
--------------------------------------------------------------------------------
Total non-current liabilities 654.7 662.5
Current liabilities
Current portion of long-term loans 1) 23.0 4.0
Other interest-bearing liabilities 1) 60.1 110.6
Provisions 66.2 70.4
Advances received 339.0 420.4
Income tax payables 40.1 53.2
Derivative liabilities 58.0 129.3
Accounts payable and other
non-interest-bearing liabilities 564.8 724.0
--------------------------------------------------------------------------------
Total current liabilities 1,151.3 1,512.0
--------------------------------------------------------------------------------
Total equity and liabilities 2,687.4 3,038.9
1) Included in interest-bearing net debt. In addition, the calculation of the
interest-bearing net debt includes
the hedging of cross-currency risk relating to the USD 300 million Private
Placement bond, totalling on 31 December 2009, EUR 17.5 (31 Dec 2008: 10.2)
million.
Consolidated Statement of Changes in Equity
Attributable to the equity holders of the Company
| |
Trans- | |
Share lation Fair | |
Share premium differ- value Retained |Minority| Total
MEUR capital account rences reserves earnings Total|interest|equity
---------------------------------------------------------------+--------+-------
Equity on 1 | |
Jan 2008 64.2 97.4 -29.6 19.9 738.7 890.6| 6.1| 896.7
---------------------------------------------------------------+--------+-------
Comprehensive | |
income for | |
the period* 9.2 -74.5 118.4 53.2| 3.4| 56.6
| |
Dividends | |
paid -65.3 -65.3| -0.6| -66.0
| |
Shares | |
subscribed | |
with options 0.1 0.6 0.7| | 0.7
| |
Acquisition of | |
treasury | |
shares -23.6 -23.6| | -23.6
| |
Share-based | |
incentives, | |
value of | |
received | |
services* -0.2 -0.2| | -0.2
| |
Other changes | 0.2| 0.2
---------------------------------------------------------------+--------+-------
Equity on | |
31 Dec 2008 64.3 98.0 -20.4 -54.6 768.0 855.3| 9.1| 864.4
---------------------------------------------------------------+--------+-------
---------------------------------------------------------------+--------+-------
Equity on | |
1 Jan 2009 64.3 98.0 -20.4 -54.6 768.0 855.3| 9.1| 864.4
---------------------------------------------------------------+--------+-------
Comprehensive | |
income | |
for the | |
period* 19.3 29.6 3.1 52.1| 4.0| 56.1
| |
Dividends paid -36.7 -36.7| -1.5| -38.2
| |
Shares | |
subscribed | |
with options 0.0 0.0 0.0| | 0.0
| |
Share-based | |
incentives, | |
value of | |
received | |
services* 0.1 0.1| | 0.1
| |
Other changes | -1.0| -1.0
---------------------------------------------------------------+--------+-------
Equity on | |
31 Dec 2009 64.3 98.0 -1.1 -24.9 734.6 870.9| 10.6| 881.5
---------------------------------------------------------------+--------+-------
* Net of tax
Key Figures
1-12/2009 1-12/2008
-------------------------------------------------------
Equity/share EUR 14.20 13.95
Interest-bearing net debt MEUR 334.8 477.8
Total equity/total assets % 37.5 33.0
Gearing % 38.0 55.3
Return on equity % 0.8 13.7
Return on capital employed % 0.2 12.7
Consolidated Statement of Cash Flows
MEUR 1-12/2009 1-12/2008
--------------------------------------------------------------------------------
Net income for the period 7.1 120.8
Depreciation and impairments 60.0 60.1
Financing items and taxes -6.9 52.9
Change in receivables 243.9 -171.2
Change in payables -301.6 309.3
Change in inventories 287.9 -237.5
Other adjustments -0.8 -0.6
--------------------------------------------------------------------------------
Cash flow from operations 289.7 133.8
Interest received 1.8 4.9
Interest paid -25.3 * -25.5
Dividends received 0.0 0.0
Other financial items 36.6 11.2
Income taxes paid -38.6 -30.7
--------------------------------------------------------------------------------
Cash flow from operating activities 264.2 93.7
Capital expenditure -106.8 -113.2
Proceeds from sales of fixed assets 29.7 15.0
Acquisitions, net of cash -7.6 -46.5
Cash flow from investing activities, other items -2.5 -10.5
--------------------------------------------------------------------------------
Cash flow from investing activities -87.2 -155.1
Proceeds from share subscriptions 0.0 0.7
Acquisition of treasury shares 0.0 -23.6
Proceeds from long-term borrowings 100.6 0.7
Repayments of long-term borrowings -4.2 -2.4
Proceeds from short-term borrowings 16.5 61.3
Repayments of short-term borrowings -46.9 -32.0
Dividends paid -37.4 -66.6
--------------------------------------------------------------------------------
Cash flow from financing activities 28.6 -61.9
--------------------------------------------------------------------------------
Change in cash 205.6 -123.3
Cash, cash equivalents and bank overdrafts 1 Jan 45.9 167.5
Effect of exchange rate changes 0.9 1.7
--------------------------------------------------------------------------------
Cash, cash equivalents and bank overdrafts 31 Dec 252.5 45.9
Bank overdrafts 31 Dec 14.2 33.3
--------------------------------------------------------------------------------
Cash and cash equivalents 31 Dec 266.6 79.2
* Interest paid include EUR 0.1 million capitalised
interests
Segment Reporting
Sales, MEUR 1-12/2009 1-12/2008
-----------------------------------------------------------
Hiab 568 907
Kalmar 1,008 1,515
MacGregor 1,009 985
Internal sales -4 -8
-----------------------------------------------------------
Total 2,581 3,399
-----------------------------------------------------------
Operating profit, MEUR 1-12/2009 1-12/2008
--------------------------------------------------------------------------------
Hiab -35.0 * 49.4 *
Kalmar 24.6 * 89.6 *
MacGregor 105.2 * 83.6
Corporate administration and
other -33.5 * -29.8 *
--------------------------------------------------------------------------------
Operating profit from operations 61.3 * 192.8 *
Restructuring costs -61.1 -19.1
--------------------------------------------------------------------------------
Total 0.3 173.7
--------------------------------------------------------------------------------
Operating profit, % 1-12/2009 1-12/2008
--------------------------------------------------------------------------------
Hiab -6.2 %* 5.4 %*
Kalmar 2.4 %* 5.9 %*
MacGregor 10.4 %* 8.5 %
Cargotec, operating profit
excluding restructuring costs 2.4 %* 5.7 %*
Cargotec 0.0 % 5.1 %
* Excluding restructuring costs of which Hiab accounted for EUR 26.8 (2008:
14.1) million, Kalmar for EUR 16.4 (4.5) million, MacGregor for EUR 1.9 (-)
million and Corporate administration for EUR 15.9 (0.3) million.
Sales by geographical segment,
MEUR 1-12/2009 1-12/2008
-----------------------------------------------------------
EMEA 1,193 1,901
Americas 457 556
Asia Pacific 931 942
-----------------------------------------------------------
Total 2,581 3,399
-----------------------------------------------------------
Sales by geographical segment, % 1-12/2009 1-12/2008
--------------------------------------------------------------------------------
EMEA 46.2 % 55.9 %
Americas 17.7 % 16.4 %
Asia Pacific 36.1 % 27.7 %
--------------------------------------------------------------------------------
Total 100.0 % 100.0 %
--------------------------------------------------------------------------------
Orders received, MEUR 1-12/2009 1-12/2008
----------------------------------------------------------------------------
Hiab 525 818
Kalmar 738 1,566
MacGregor 569 1,393
Internal orders received -3 -9
----------------------------------------------------------------------------
Total 1,828 3,769
----------------------------------------------------------------------------
Order book, MEUR 31 Dec 2009 31 Dec 2008
----------------------------------------------------------------------------
Hiab 119 164
Kalmar 427 704
MacGregor 1,604 2,187
Internal order book 0 -1
----------------------------------------------------------------------------
Total 2,149 3,054
----------------------------------------------------------------------------
Capital expenditure, MEUR 1-12/2009 1-12/2008
----------------------------------------------------------------------------
In fixed assets (excluding acquisitions) 86.9 75.7
In leasing agreements 0.9 1.1
In customer financing 19.0 35.9
----------------------------------------------------------------------------
Total 106.8 112.8
----------------------------------------------------------------------------
Number of employees at the end of year 31 Dec 2009 31 Dec 2008
----------------------------------------------------------------------------
Hiab 3,127 4,308
Kalmar 3,862 4,766
MacGregor 2,286 2,577
Corporate administration and support functions 331 175
----------------------------------------------------------------------------
Total 9,606 11,826
----------------------------------------------------------------------------
Average number of employees 1-12/2009 1-12/2008
----------------------------------------------------------------------------
Hiab 3,746 4,509
Kalmar 4,277 4,680
MacGregor 2,476 2,449
Corporate administration and support functions 285 139
----------------------------------------------------------------------------
Total 10,785 11,777
----------------------------------------------------------------------------
Notes
Taxes in income statement
MEUR 1-12/2009 1-12/2008
--------------------------------------------------------------------------------
Current year tax expense 20.9 46.3
Change in deferred tax assets and
liabilities -44.0 -8.9
Tax expense for previous years -10.8 -13.0
--------------------------------------------------------------------------------
Total -33.9 24.4
--------------------------------------------------------------------------------
Commitments
MEUR 31 Dec 2009 31 Dec 2008
--------------------------------------------------------------------------------
Guarantees 0.5 0.2
Dealer financing 0.1 0.2
End customer financing 10.3 11.5
Operating leases 49.1 48.0
Other contingent liabilities 3.7 4.0
--------------------------------------------------------------------------------
Total 63.7 63.9
--------------------------------------------------------------------------------
Cargotec Corporation has guaranteed obligations of Cargotec companies, arising
from ordinary course of business,
up to a maximum of EUR 554.7 (31 Dec 2008: 599.3) million.
Cargotec leases property, plant and equipment under non-cancellable operating
leases. The leases have varying terms and renewal rights.
It is not anticipated that any material liabilities will arise from trade
finance commitments.
The future minimum lease payments under non-cancellable operating
leases
MEUR 31 Dec 2009 31 Dec 2008
--------------------------------------------------------------------------------
Less than 1 year 13.1 14.9
1-5 years 23.0 26.5
Over 5 years 13.1 6.7
--------------------------------------------------------------------------------
Total 49.1 48.0
The aggregate operating lease expenses totaled EUR 14.7 (2008:
15.6) million.
Fair values of derivative financial instruments
Positive Negative Net fair Net fair fair value fair value value value
MEUR 31 Dec 2009 31 Dec 2009 31 Dec 2009 31 Dec 2008
--------------------------------------------------------------------------------
FX forward contracts,
cash flow hedges 42.0 72.2 -30.1 -119.4
FX forward contracts,
non-hedge accounted 5.9 4.3 1.6 67.2
Cross currency and
interest rate swaps, cash
flow hedges - 9.9 -9.9 23.7
--------------------------------------------------------------------------------
Total 47.9 86.4 -38.5 -28.4
--------------------------------------------------------------------------------
Non-current portion:
FX forward contracts,
cash flow hedges 9.1 18.4 -9.4 -53.2
Cross currency and
interest rate swaps, cash
flow hedges - 9.9 -9.9 23.7
--------------------------------------------------------------------------------
Non-current portion 9.1 28.4 -19.3 -29.5
--------------------------------------------------------------------------------
Current portion 38.8 58.0 -19.2 1.1
--------------------------------------------------------------------------------
Cross currency and interest rate swaps hedge the US Private Placement
corporate bond funded in February 2007.
Nominal values of derivative financial instruments
MEUR 31 Dec 2009 31 Dec 2008
-------------------------------------------------------------------------------
FX forward contracts 2,386.5 3,617.5
Cross currency and interest rate swaps 225.7 225.7
-------------------------------------------------------------------------------
Total 2,612.3 3,843.3
-------------------------------------------------------------------------------
Acquisitions and disposals
Acquisitions 2009
In 2009, Cargotec completed two acquisitions.
In December the service business assets of Moroccan company Société Maghrebic,
SA.'s business operations. Maghrepic has been Cargotec's dealer representative
in Morocco and has long experience as a service and spare parts provider.
According to the deal, Cargotec employed 44 persons, most of whom are service
technicians.
In August Cargotec purchased the assets of the Danish sales and service company
Arne Holst & Co. A/S. This acquisition included the takeover of business assets
and customer contacts as well as the transfer of four employees to Cargotec.
In addition, Cargotec acquired an 18 percent minority holding in Kalmar España,
S.A. and 20 percent minority holdings in Italian Officine Cargotec Ferrari
Genova S.r.l. and Officine Cargotec Ferrari Prato S.r.l. as well as in
Australian Hiab Australia Pty Ltd. Subsequent to these transactions, Cargotec
owns all the shares in the companies.
In 2009, Hiab established a small joint-venture focusing on the environmental
segment in China.
The transaction price of the acquisitions completed in 2009 amounted to EUR 7.2
million and the related goodwill in Cargotec balance sheet to EUR 3.1 million.
Goodwill amounting to EUR 2.2 million is related to the acquisition of the
minority interests.
Management estimates that the consolidated sales for 2009 would have been EUR
2,588 million if the acquisitions had been completed on 1 January 2009.
The business combinations of Société Maghrepic S.A. and Arne Holst & Co. A/S
were accounted as preliminary as the determination of fair values to be assigned
to the assets, liabilities and contingent liabilities was not yet finalised.
The business combinations of Equipos y Servicios Terminales y Puertos SRL, CVS
Technoports S.r.l. and CVS Service S.r.l. were accounted as preliminary at the
end of 2008, as the determination of fair values was unfinished. The accounting
of these acquisitions was finalised in 2009. This had no impact on the previous
year's figures.
Disposals 2009
In November, Cargotec agreed on the termination of the 2006 signed cooperation
agreement with the Chinese company Goodway. The cooperation agreement will be
terminated in early 2010. In October, Cargotec agreed to transfer its off-road
forestry cranes business to the Finnish Mesera Salo Oy. The transfer agreement
also included stationary mounted off-road crane models. As part of the deal,
some key employees in the off-road crane business transferred to Mesera. The
real estate related to the business and located in Salo, Finland, was sold to
the Finnish Rakennus-Järvi Oy in December. These transactions had no material
impact on Cargotec's result or cash flow.
Accounting Principles
The financial statements review has been prepared according to the International
Accounting Standard 34: Interim Financial Reporting. The accounting policies
adopted are consistent with those of the annual financial statements of 2009.
All figures presented have been rounded and consequently the sum of individual
figures may deviate from the presented sum figure.
Adoption of new and revised standards starting on 1 January 2009
Starting from 1 January 2009, Cargotec has adopted the following new and revised
standards by the IASB published in 2008:
- IFRS 8, Operating segments: The adoption of the new standard does not have a
material impact on the segment information presented in the financial
statements, as Cargotec segment reporting was also previously aligned with
management reporting, and the accounting principles of the management reporting
are consistent with those of the financial reporting.
-IAS 1, Presentation of Financial Statements: The adoption of the revised
standard has an impact on the presentation of financial statements.
- IAS 23, Borrowing Costs: The amended standard requires that also the borrowing
costs that are directly attributable to the acquisition of the qualifying asset
form part of the cost of that asset. In previous years, Cargotec has expensed
such borrowing costs as incurred. The amendment has no material impact on the
result for the financial year.
Calculation of key figures
Total equity attributable to the shareholders
of the parent company
Equity / share = _______________________________________
Share issue adjusted number of shares
at the end of period (excluding treasury shares)
Interest-bearing
net debt = Interest-bearing debt* - interest-bearing assets
Total equity
Total equity /
total assets (%) = 100 x _______________________________________
Total assets - advances received
Interest-bearing debt* - interest-bearing assets
Gearing (%) = 100 x _______________________________________
Total equity
Net income for period
Return on equity
(%) = 100 x _______________________________________
Total equity (average for period)
Income before taxes + interest and other
financing expenses
Return on capital
employed (%) = 100 x ________________________________________________
Total assets - non-interest-bearing debt
(average for period)
Net income for the period attributable to the
shareholders of the parent company
Basic earnings /
share = ________________________________________________
Share issue adjusted weighted average number of shares during the
period (excluding treasury shares)
* Including cross currency hedging of the USD 300 million Private Placement
corporate bond.
Quarterly
Figures
Cargotec Q4/2009 Q3/2009 Q2/2009 Q1/2009 Q4/2008
--------------------------------------------------------------------------------
Orders received MEUR 464 437 471 456 633
Order book MEUR 2,149 2,371 2,555 2,772 3,054
Sales MEUR 669 559 678 675 924
Operating
profit MEUR 31.7 * 11.6 * 3.0 * 15.0 * 35.9 *
Operating
profit % 4.7 * 2.1 * 0.4 * 2.2 * 3.9 *
Basic
earnings/share EUR 0.18 -0.02 -0.12 0.01 0.14
Hiab Q4/2009 Q3/2009 Q2/2009 Q1/2009 Q4/2008
--------------------------------------------------------------------------------
Orders received MEUR 143 114 130 138 157
Order book MEUR 119 127 138 148 164
Sales MEUR 152 124 139 153 216
Operating
profit MEUR -5.7 * -9.2 * -11.9 * -8.1 * 3.7 *
Operating
profit % -3.8 * -7.4 * -8.5 * -5.3 * 1.7 *
Kalmar Q4/2009 Q3/2009 Q2/2009 Q1/2009 Q4/2008
--------------------------------------------------------------------------------
Orders received MEUR 162 164 187 224 348
Order book MEUR 427 459 514 611 704
Sales MEUR 213 207 282 306 413
Operating
profit MEUR 3.5 * 1.9 * 5.6 * 13.6 * 12.1 *
Operating
profit % 1.6 * 0.9 * 2.0 * 4.5 * 2.9 *
MacGregor Q4/2009 Q3/2009 Q2/2009 Q1/2009 Q4/2008
--------------------------------------------------------------------------------
Orders received MEUR 160 158 155 96 129
Order book MEUR 1,604 1,785 1,903 2,013 2,187
Sales MEUR 305 229 257 218 298
Operating
profit MEUR 40.5 * 22.9 23.3 18.4 30.7
Operating
profit % 13.3 * 10.0 9.1 8.5 10.3
* Excluding restructuring cost
[HUG#1380161]
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