2016-10-25 11:00:55 CEST
2016-10-25 11:00:55 CEST
REGULATED INFORMATION
Cargotec - Interim report (Q1 and Q3)
Cargotec's January-September 2016 interim report: operating profit margin improved
CARGOTEC CORPORATION, INTERIM REPORT, 25 OCTOBER 2016 AT NOON EEST
Cargotec's January-September 2016 interim report: operating profit margin
improved
- Profitability continued to improve in Hiab
- No big project orders in Kalmar, long term market potential still strong
- Challenging market situation continued in MacGregor
July-September 2016 in brief
* Orders received decreased 19 percent and totalled EUR 733 (907) million.
* Order book amounted to EUR 1,874 (31 Dec 2015: 2,064) million at the end of
the period.
* Sales declined 8 percent and totalled EUR 854 (928) million.
* Sales in services totalled 210 (216) million, representing 25 (23) percent
of consolidated sales.
* Operating profit excluding restructuring costs decreased 3 percent and was
EUR 65.9 (68.3) million, representing 7.7 (7.4) percent of sales.
* Operating profit was EUR 56.2 (61.9) million, representing 6.6 (6.7) percent
of sales.
* Cash flow from operations before financial items and taxes totalled EUR
74.4 (74.5) million.
* Net income for the period amounted to EUR 33.5 (43.6) million.
* Earnings per share was EUR 0.52 (0.67).
January-September 2016 in brief
* Orders received decreased 10 percent and totalled EUR 2,461 (2,733) million.
* Sales declined 6 percent and totalled EUR 2,581 (2,753) million.
* Sales in services totalled 641 (653) million, representing 25 (24) percent
of consolidated sales.
* Operating profit excluding restructuring costs increased 6 percent and was
EUR 189.3 (178.6) million, representing 7.3 (6.5) percent of sales.
* Operating profit was EUR 176.4 (168.1) million, representing 6.8 (6.1)
percent of sales.
* Cash flow from operations before financial items and taxes totalled EUR
221.0 (227.3) million.
* Net income for the period amounted to EUR 113.0 (107.4) million.
* Earnings per share was EUR 1.75 (1.67).
Outlook for 2016 unchanged
Cargotec's 2016 sales are expected to be at the 2015 level (EUR 3,729 million)
or slightly below. Operating profit excluding restructuring costs for 2016 is
expected to improve from 2015 (EUR 230.7 million).
Cargotec's key figures
MEUR 7-9/2016 7-9/2015 Change 1-9/2016 1-9/2015 Change 2015
-------------------------------------------------------------------------------
Orders received 733 907 -19% 2,461 2,733 -10% 3,557
Service orders -9% 0%
received 205 226 667 665 880
Order book, end of -16% -16%
period 1,874 2,233 1,874 2,233 2,064
Sales 854 928 -8% 2,581 2,753 -6% 3,729
Sales of services 210 216 -3% 641 653 -2% 883
Sales of services, %
of Cargotec's sales 25 23 25 24 24
Operating profit* 65.9 68.3 -3% 189.3 178.6 6% 230.7
Operating profit, %* 7.7 7.4 7.3 6.5 6.2
Operating profit 56.2 61.9 -9% 176.4 168.1 5% 213.1
Operating profit, % 6.6 6.7 6.8 6.1 5.7
Income before taxes 46.6 55.4 154.9 149.2 186.2
Cash flow from
operations 74.4 74.5 221.0 227.3 314.6
Net income for the
period 33.5 43.6 113.0 107.4 142.9
Earnings per share,
EUR 0.52 0.67 1.75 1.67 2.21
Net debt, end of
period 581 678 581 678 622
Gearing, % 41.6 52.5 41.6 52.5 46.4
Personnel, end of
period 11,226 10,876 11,226 10,876 10,837
*excluding restructuring costs
Cargotec's CEO Mika Vehviläinen:
Hiab's strong development continued during the third quarter and profitability
improved compared to the previous year. Hiab's core business orders were at a
good level, but we did not receive any big defence industry orders as we did
during the comparison period.
Kalmar's result was also satisfactory; however, the pace of customer decision
making has slowed down, which could be seen in declining order numbers. Kalmar's
long-term market potential is still strong: bigger ship sizes and the need to
develop ports and make operations more effective require investments in port
technology and automation. The number of potential projects is still large, but
customers are delaying their investment decisions.
The challenging market situation continued in MacGregor. The global merchant
ship market is facing overcapacity and new ship orders are at an exceptionally
low level. Industry consolidation, alliances and possible new ship routes create
uncertainty in the industry. We are continuing with our measures to lower the
MacGregor cost level.
Our strategic focus areas are services, digitalisation and leadership
development. In services we see tremendous business potential that we need to
grasp with increased determination. We have increased our efforts in this area;
for example, Hiab opened a spare parts web shop in September, MacGregor
strengthened its spare parts delivery cooperation relationships in Asia, and
Kalmar has initiated new measures to speed up the growth in services. In terms
of digitalisation, we are developing Cargotec IoT Cloud-based solutions with our
customers regarding, for example, automation effectiveness and proactive
maintenance. Our internal leadership development programme is expanding to the
next phase now that the first 200 leaders have completed the intensive training
programme.
We are focusing our efforts on projects that improve competitiveness, the cost
efficiency of products and digitalisation. Additionally, we are investing in
global systems and procedures that in future enable higher efficiency in
operational activities as well as in support functions.
Alternative performance measures (APMs) used in Cargotec's financial reporting
New ESMA (European Securities and Markets Authority) guidelines on
Alternative Performance Measures (Alternative performance measure (APM) =
financial measure other than financial measure defined or specified in IFRS) are
effective as of 3 July 2016. The new guidelines have had no impact on
performance measures used by Cargotec, but in accordance with the guidelines,
Cargotec publishes the explanation of use, definitions as well as
reconciliations of its APMs to IFRS financial statements.
APMs are used at Cargotec to better convey the underlying business performance
and to enhance comparability from period to period. APMs are not substituting
the performance measures stipulated by IFRS, but are instead reported as
complementary information.
The alternative performance measures used by Cargotec are:
* Operating profit excluding restructuring costs= Operating profit +
restructuring costs
* Operating profit excluding restructuring costs, % of sales = (Operating
profit + restructuring costs) / Sales * 100
* Interest-bearing net-debt = Interest-bearing debt - interest-bearing assets
+/- Foreign-currency hedge of corporate bonds
Restructuring costs include restructuring provisions, asset impairments and
disposals, expenses for vacant premises and other restructuring-related expenses
in case of a significant restructuring programme of Cargotec or its business
area. In the interim report, the reconciliation of operating profit excluding
restructuring costs to operating profit of the statement of income is presented
in note 3. Reconciliation of interest-bearing net debt to interest-bearing
liabilities and assets is presented in note 6.
Press conference for analysts and media
A press conference for analysts and media, combined with a live international
telephone conference, will be arranged on the publishing day at 2:00 p.m. EEST
at Cargotec's head office, Porkkalankatu 5, Helsinki. The event will be held in
English. The report will be presented by CEO Mika Vehviläinen and Executive Vice
President, CFO Mikko Puolakka. The presentation material will be available at
www.cargotec.com by 2:00 p.m. EEST.
The telephone conference, during which questions may be presented, can be
accessed using the following numbers with access code Cargotec/3575778:
FI: +358 9 7479 0361
SE: +46 8 5033 6574
UK: +44 203 043 2003
US: +1 719 457 1036
The event can also be viewed as a live webcast at www.cargotec.com. An on-demand
version of the conference will be published at Cargotec's website later during
the day.
For further information, please contact:
Mikko Puolakka, Executive Vice President and CFO, tel. +358 20 777 4105
Hanna-Maria Heikkinen, Vice President, Investor Relations, tel. +358 20 777 4084
Cargotec (Nasdaq Helsinki: CGCBV) is a leading provider of cargo and load
handling solutions with the goal of becoming the leader in intelligent cargo
handling. Cargotec's business areas Kalmar, Hiab and MacGregor offer products
and services that ensure our customers a continuous, reliable and sustainable
performance. Cargotec's sales in 2015 totalled approximately EUR 3.7 billion and
it employs over 11,000 people. www.cargotec.com
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