Konecranes Oyj - Company Announcement

KONECRANES PLC - KONECRANES ANNOUNCES PRELIMINARY THIRD QUARTER FIGURES, LOWERS 2011 OPERATING PROFIT GUIDANCE DUE TO WEAKER THAN EXPECTED GROWTH IN SERVICE

KONECRANES PLC  STOCK EXCHANGE RELEASE  October 10, 2011  8.30 a.m.

Konecranes forecasts its 2011 operating profit, excluding possible
restructuring costs, to be approximately on the same level as in 2010. Sales
are expected to be higher than in 2010. 

The demand for Konecranes' products and services developed according to the
expectations in the third quarter of 2011. Konecranes' preliminary third
quarter order intake was approximately EUR 459 million, sales 451 million and
operating profit EUR 26 million. 

The reason for the lower than expected sales and operating profit in the third
quarter is a weaker development within Business Area Service. Growth in
deliveries has been slower than originally planned, which affects fixed cost
absorption in the expanded service network. Growth in capacity utilization
within key customer groups has stagnated, affecting spare parts demand and thus
our profitability. Additionally, certain modernization projects have suffered
from execution bottlenecks. Due to these reasons, the Business Area Service
operating profit in 2011 is expected to fall short from that of 2010. 

Sales and profitability of Business Area Equipment has developed according to
the expectations and the 2011 operating profit of the business area is forecast
to increase from 2010. 

Finnish Metalworkers' Union, salaried workers' union Pro and the Federation of
Professional and Managerial Staff YTN have declared a ban on overtime in the
technology industry as a result of the interrupted collective bargaining
negotiations. The overtime ban started on October 4. At the same time, the
Metalworkers' Union and Pro have issued a strike warning on 44 companies
including Konecranes. The initial phase of the industrial action would start on
October 21. The action is planned to end on November 7 if no solution is
reached in the negotiations before that. To mitigate the adverse effects of the
possible industrial action, Konecranes has already started to move its
deliveries from Finland to its other supply units outside Finland. This results
in additional costs. The strike, if realized, would put pressure on reaching
the new financial guidance for 2011. 

The management will initiate actions to reduce costs and to improve operational
efficiency within the Group. Due to these actions, Konecranes may incur
restructuring costs in the fourth quarter of 2011, which are not taken into
account in the new financial guidance. 

Konecranes estimated in its January-June interim report the year 2011 sales and
operating profit to be higher than in 2010 while complementing that the
increased technology and IT development will add approximately EUR 20 million
to the cost base from 2011, while the benefits will follow from 2012 onwards.
Konecranes' 2010 operating profit was, excluding restructuring costs, EUR 115.1
million and including restructuring costs EUR 112.4 million. 

Further information on Konecranes' financial performance and market outlook
will be given in the January-September 2011 interim report on October 20. 


KONECRANES PLC


Miikka Kinnunen, Director, Investor Relations



FURTHER INFORMATION
Investors and analysts:
Miikka Kinnunen, Director, Investor Relations
E-mail: miikka.kinnunen@konecranes.com or phone +358 20 427 2050

Teo Ottola, CFO
E-mail: teo.ottola@konecranes.com or phone +358 50 521 1064

Media:
Mikael Wegmüller, Vice President, Marketing and Communications
E-mail: mikael.wegmuller@konecranes.com or phone +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 2010, Group sales totaled EUR 1,546 million. The Group has 11,200
employees at 578 locations in 46 countries. Konecranes is listed on the NASDAQ
OMX Helsinki (symbol: KCR1V). 



DISTRIBUTION
NASDAQ OMX Helsinki
Media
www.konecranes.com