2008-10-29 09:00:00 CET
2008-10-29 09:00:04 CET
REGULATED INFORMATION
Konecranes Oyj - Interim report (Q1 and Q3)
KONECRANES PLC: INTERIM REPORT JANUARY-SEPTEMBER 2008
KONECRANES PLC INTERIM REPORT October 29, 2008 at 10:00 a.m. Finnish time GOOD ORDER INTAKE CONTINUED AND PROFITABILITY IMPROVED Figures in brackets, unless otherwise stated, refer to the same period a year earlier THIRD QUARTER HIGHLIGHTS - Order intake was on a good level at EUR 515.9 million (506.4). Reported growth was 1.9 percent and growth at comparable currency rates was 5.4 percent. - Order book at end September grew by 34.0 percent year-on-year and reached EUR 1,065.2 million (794.8). - Order intake continued strong in Service and Standard Lifting but decreased as anticipated in Heavy Lifting. - Sales grew by 22.6 percent to EUR 520.4 million (424.4). Growth at comparable currency rates was 28.9 percent. - Operating profit was EUR 69.0 million (45.5), 13.3 percent of sales (10.7). JANUARY-SEPTEMBER HIGHLIGHTS - Orders received grew by 18.3 percent and totaled EUR 1,657.5 million (1,401.0). Growth at comparable currency rates was 23.7 percent. - Sales grew by 18.3 percent and were EUR 1,452.1 million (1,227.0). Growth at comparable currency rates was 24.3 percent. - Operating profit increased to EUR 172.3 million (114.4, excluding capital gain) and was 11.9 percent of sales (9.3, excluding capital gain). - Profit before taxes was EUR 162.4 million (104.3, excluding capital gain). - Earnings per share (diluted) was EUR 1.97 (1.21, excluding capital gain). FUTURE PROSPECTS - Full year 2008 sales growth target unchanged: sales targeted at 15 - 20 percent higher than in 2007. - Full year 2008 operating margin target unchanged: to exceed previous year's level. - Shortage of credit is affecting customer behavior; order intake in Q4 may be lower than in Q3. -------------------------------------------------------------------------------- | KEY FIGURES | 7-9/ | 7-9/ | Chang | 1-9/ | 1-9/ | R12M | 2007 | | | 2008 | 2007 | e % | 2008 | 2007 | | | -------------------------------------------------------------------------------- | Orders | 515.9 | 506.4 | 1.9 | 1 | 1 401.0 | 2 128.5 | 1 872.0 | | received, MEUR | | | | 657.5 | | | | -------------------------------------------------------------------------------- | Order book at | 1 | 794.8 | 34.0 | 1 | 794.8 | | 757.9 | | end of period, | 065.2 | | | 065.2 | | | | | MEUR | | | | | | | | -------------------------------------------------------------------------------- | Sales total, | 520.4 | 424.4 | 22.6 | 1 | 1 227.0 | 1 974.8 | 1 749.7 | | MEUR | | | | 452.1 | | | | -------------------------------------------------------------------------------- | Operating | 69.0 | 45.5 | 51.5 | 172.3 | 114.4* | 232.7 | 174.7* | | profit, MEUR | | | | | | | | -------------------------------------------------------------------------------- | Operating | 13.3 | 10.7 | | 11.9 | 9.3 %* | 11.8 % | 10.0 %* | | margin, % | % | % | | % | | | | -------------------------------------------------------------------------------- | Profit before | 63.5 | 41.5 | 52.9 | 162.4 | 104.3* | 219.2 | 161.2* | | taxes, MEUR | | | | | | | | -------------------------------------------------------------------------------- | Net profit for | 45.4 | 29.5 | 54.0 | 116.6 | 73.6* | 159.2 | 116.1* | | the period, | | | | | | | | | MEUR | | | | | | | | -------------------------------------------------------------------------------- | Earnings per | 0.77 | 0.49 | 56.6 | 1.99 | 1.23* | 2.70 | 1.95* | | share, basic, | | | | | | | | | EUR | | | | | | | | -------------------------------------------------------------------------------- | Earnings per | 0.77 | 0.48 | 61.4 | 1.97 | 1.21* | 2.68 | 1.92* | | share, | | | | | | | | | diluted, EUR | | | | | | | | -------------------------------------------------------------------------------- | Gearing % | | | | 8.8 % | 22.4 % | | 7.0 % | -------------------------------------------------------------------------------- | Return on | | | | | | 52.3 % | 50.4 % | | capital | | | | | | | | | employed %, | | | | | | | | | Rolling 12 | | | | | | | | | Months (R12M) | | | | | | | | -------------------------------------------------------------------------------- | Average number | | | | 9 051 | 7 905 | | 8 005 | | of personnel | | | | | | | | | during the | | | | | | | | | period | | | | | | | | -------------------------------------------------------------------------------- * 2007 operating profit, operating margin, profit before taxes, net profit for the period and earnings per share figures are presented excluding the capital gain on the sale of real estate booked in Q2 2007, while other figures include the capital gain. Including the capital gain, the operating profit and profit before taxes are EUR 17.6 million higher, the net profit for the period is EUR 13.0 million higher, and earnings per share is EUR 0.22 higher than presented. President and CEO Pekka Lundmark: "We can be pleased with our third quarter results. In spite of the uncertainty in the world economy, our order intake remained at a good level. In fact, this quarter's orders were the third highest in our company's history. Delivery volumes grew fast, the product mix was favorable and we succeeded in controlling our costs well, and we can report a very satisfying 13.3 percent operating margin for the quarter. As seen today, our order book looks healthy. We have received some order cancellations and requests for extended delivery times, but the effect so far on our business outlook is very small. However, should the credit market not stabilize in the near future, this situation could change. On the other hand, advance payments received represent approximately one fourth of our order book. This reduces the financial impact of order cancellations. The fact that we are almost debt-free is another valuable asset right now. Even though our company is not immune to a general slowdown in the world economy, there are several ways to seek continued growth even when the times get tougher. Many customers are interested in large scale maintenance service outsourcing deals when times are bad, simply to improve productivity and reduce costs. Several infrastructure related customer segments where we have a strong position, such as power generation, transportation and waste handling, are also likely to continue investments in a downturn. There are still several geographical markets in the world where we do not have sufficient coverage. We intend to continue to increase our market share organically, but a weak economy typically also opens up attractive opportunities for acquisitions at reasonable prices. And finally, we have plans to widen our product and service offering through important launches during the upcoming quarters. The extent to which these items will be able to compensate the effects of the downturn depends largely on how severe the dip in the economy is and how long it lasts.” KONECRANES'S JANUARY - SEPTEMBER 2008 INTERIM REPORT MARKET REVIEW General uncertainty has been increasing in the overall economic environment since the beginning of the year. The financial crisis that escalated in the latter part of the third quarter has spread fears of a severe economic slowdown in the world economy. However, during the past nine months, the effects of this development were not yet notably visible in the demand for lifting equipment and services, even if towards the end of the reporting period there were signs of declining industrial activity and confidence in certain markets. In fact, during the third quarter, activity in most of the customer segments - especially in steel and other metals, power, petrochemical, mining and waste-to-energy - remained strong. On the other hand, activity in the pulp & paper and automotive industries remained low globally and general manufacturing was showing some signs of softening. In the ports sector activity continued to be slow in the Americas and shipyards began to show some softening in the APAC area as well. However, even if the uncertainty was not yet directly visible in the demand for lifting equipment and services, it gradually began to be reflected in customer behavior in terms of slower decision making. This cautiousness was more pronounced with smaller customers than at larger companies. During the third quarter, input costs, especially for steel, labor and transportation, continued to rise. After the end of the reporting period raw material prices, especially for steel, have begun to decline. Note: Unless otherwise stated, the figures in brackets in the sections below refer to the same period in the previous year. ORDERS RECEIVED January-September orders received totaled EUR 1,657.5 million (1,401.0) representing growth of 18.3 percent. Orders received increased in Service by 5.9 percent, in Standard Lifting by 23.4 percent and in Heavy Lifting by 25.1 percent compared with a year earlier. Third-quarter order intake was on a good level at EUR 515.9 million (506.4). Order intake growth continued strong in Service and Standard Lifting and in the process crane segment of the Business Area Heavy Lifting. However, low orders in port equipment in Americas and in shipyards in APAC depressed the total Heavy Lifting orders. Regionally, solid growth in order intake continued in EMEA in all Business Areas. In APAC, total orders received increased despite the decline in Heavy Lifting as a result of good development both in Service and especially in Standard Lifting. In Americas, order intake remained strong in Service and Standard Lifting as well as in the process crane segment of Heavy Lifting. In the third quarter, orders from emerging markets accounted for slightly more than one third of order intake, compared with approximately 40 percent in the second quarter. Main reason for the decrease from the second quarter was the timing of Heavy Lifting orders from Russia. ORDER BOOK The value of the order book at end September totaled EUR 1,065.2 million. The order book increased slightly from the second quarter when it stood at EUR 1,027.7 million. Service accounted for EUR 151.6 million (14 percent), Standard Lifting for EUR 418.2 million (38 percent) and Heavy Lifting for EUR 531.7 million (48 percent) of the total end September order book. SALES Group sales in January-September grew by 18.3 percent and totaled EUR 1,452.1 million (1,227.0). Higher prices accounted for less than 5 percentage points of the sales growth. Third quarter sales grew by 22.6 percent and were EUR 520.4 million (424.4). Service sales grew by 8.1 percent, Standard Lifting by 26.5 percent and Heavy Lifting by 39.6 percent compared with the corresponding period in 2007. At end September, calculated for rolling 12 months, the regional breakdown was as follows: EMEA 57 (52), Americas 29 (35) and APAC 14 (13) percent. -------------------------------------------------------------------------------- | Net | 7-9/ | 7-9/ | Change | Change | 1-9/ | 1-9/ | R12M | 2007 | | sales | 2008 | 2007 | percen | % at | 2008 | 2007 | | | | by | | | t | comp. | | | | | | region | | | | currenc | | | | | | , MEUR | | | | y rates | | | | | -------------------------------------------------------------------------------- | EMEA | 298. | 238. | 24.9 | 27.5 | 827.2 | 653.8 | 1,124. | 951.4 | | | 1 | 6 | | | | | 9 | | -------------------------------------------------------------------------------- | AME | 144. | 135. | 6.5 | 19.2 | 413.6 | 430.2 | 573.1 | 589.7 | | | 1 | 4 | | | | | | | -------------------------------------------------------------------------------- | APAC | 78.3 | 50.4 | 55.3 | 59.9 | 211.3 | 143.0 | 276.8 | 208.6 | -------------------------------------------------------------------------------- | Total | 520. | 424. | 22.6 | 28.9 | 1,452. | 1,227.0 | 1,974. | 1,749. | | | 4 | 4 | | | 1 | | 8 | 7 | -------------------------------------------------------------------------------- CURRENCY RATE EFFECT Year-on-year order intake growth in January-September at comparable currency rates was 23.7 percent whereas the reported growth was 18.3 percent. The corresponding growth figures for sales were 24.3 and 18.3 respectively. In the third quarter Group order intake growth at comparable currency rates was 5.4 whereas the reported growth was 1.9 percent. The third quarter growth figures for sales were 28.9 and 22.6, respectively. Of the Business Areas, Service was most affected by the stronger euro rate, with order growth of 16.8 percent and sales growth of 16.1 percent at comparable currency rates, compared with 9.9 and 8.1 respectively in reported growth. Of the regions, the impact was largest in the Americas region, with sales increasing by 19.2 percent at comparable currency rates, compared with the increase of 6.5 percent in reported sales. The impact of changes in currency rates reduced the Group's operating margin by approximately 1 percentage point in both January-September and the third quarter compared with the same periods a year earlier. FINANCIAL RESULT The consolidated operating profit in January-September totaled EUR 172.3 million (114.4, excluding capital gain). Operating profit increased by EUR 57.9 million and the consolidated operating margin rose to 11.9 percent (9.3, excluding capital gain). Third-quarter operating profit rose to EUR 69.0 million (45.5) and the operating margin was 13.3 percent (10.7). All Business Areas contributed to the increase. The operating margin was on a good level of 14.5 percent in Service (14.3). Operating margin in Standard Lifting rose to a very good level of 18.4 percent (15.4) and improved substantially in Heavy Lifting to 9.0 percent (3.3). The net effect of higher prices and input costs in the third quarter was flat. The share of associated companies' and joint ventures' result, and net financial expenses totaled EUR -9.9 million (-10.0) in January-September. January-September profit before taxes was EUR 162.4 million (104.3, excluding capital gain). Income taxes in January-September were EUR -45.8 million (-30.8, excluding capital gain). The Group's effective tax rate was 28.2 percent (29.5, excluding capital gain). Net profit for January-September was EUR 116.6 million (73.6, excluding capital gain). Diluted earnings per share for January-September were EUR 1.97 (1.21, excluding capital gain). On a rolling twelve-month basis, return on capital employed was 52.3 percent (37.7, excluding capital gain) and return on equity 49.6 percent (43.2, excluding capital gain). Balance Sheet The consolidated balance sheet, which at end September stood at EUR 1,179.8 million, was EUR 209.8 million higher than at 30 September 2007 and EUR 222.9 million higher than at year-end 2007. Total equity at the end of the report period was EUR 354.6 million (287.1). From the end of the second quarter 2008 net working capital increased by EUR 7.8 million to EUR 243.1 million at end September. Increase in net working capital was mainly due to increase in inventories. Cash Flow and Financing Net cash flow from operating activities in January-September was EUR 73.6 million (86.6), representing EUR 1.24 per diluted share (1.43). In the third quarter, net cash flow from operating activities was EUR 51.4 million (52.1). Interest-bearing net debt decreased to EUR 31.1 million from EUR 73.6 million at end June. Interest-bearing net debt at end December 2007 was EUR 19.7 million. The solidity was 38 percent (35.4) and gearing 8.8 percent (22.4). The Group has a EUR 200-million committed back-up financing facility to secure running liquidity. At 30 September, none of this was in use. The amount in use at year-end 2007 was EUR 27.2 million. Total equity attributable to equity holders of the parent company at 30 September was EUR 353.0 million (287.1) or EUR 6.00 per share (4.78). Konecranes paid its shareholders dividends amounting to EUR 46.8 million or EUR 0.80 per share in March, 2008. CAPITAL EXPENDITURE January-September capital expenditure excluding acquisitions amounted to EUR 18.8 million (18.1). This amount consisted mainly of replacement or capacity expansion investments on machines, equipment and information technology. Capital expenditure including acquisitions was EUR 35.2 million (35.3). Third quarter capital expenditure excluding acquisitions was EUR 9.1 million (5.3) and including acquisitions EUR 11.3 million (17.1). ACQUISITIONS During January-September, EUR 16.4 million was spent on a total of nine acquisitions. Net assets of the acquired companies were recorded at EUR 12.7 million and goodwill of EUR 3.7 million was booked from the acquisitions. During the third quarter EUR 2.2 million was spent on three acquisitions mainly to support the Service strategy. Non-organic growth both in January-September and in the third quarter sales was approximately 3 percentage points. PERSONNEL In January-September the Group employed an average of 9,051 people (7,905). At 30 September, the headcount was 9,602 (8,284). At end September, the number of personnel by Business Area were as follows: Service 5,261 employees (4,390), Standard Lifting 2,669 employees (2,412), Heavy Lifting 1,393 employees (1,269) and Group staff 279 (213). The Group had 5,522 employees (4,677) working in EMEA, 2,569 (2,432) in the Americas and 1,511 (1,175) in the APAC region. BUSINESS AREAS Change in reporting method As of January 1, 2008 all the services and spare parts business is reported in the Service Business Area. The Business Area figures for 2007 have been restated for better comparability. Service -------------------------------------------------------------------------------- | | 7-9/ | 7-9/ | Change | 1-9/ | 1-9/ | R12M | 2007* | | | 2008 | 2007 | percen | 2008 | 2007* | | | | | | | t | | | | | -------------------------------------------------------------------------------- | Orders received, | 170.1 | 154.8 | 9.9 | 498.9 | 470.9 | 651.3 | 623.4 | | MEUR | | | | | | | | -------------------------------------------------------------------------------- | Order book, MEUR | 151.6 | 122.8 | 23.5 | 151.6 | 122.8 | | 109.3 | -------------------------------------------------------------------------------- | Sales, MEUR | 187.2 | 173.2 | 8.1 | 533.7 | 503.0 | 722.8 | 692.2 | -------------------------------------------------------------------------------- | Operating profit, | 27.1 | 24.7 | 9.7 | 72.8 | 64.3 | 100.4 | 91.9 | | MEUR | | | | | | | | -------------------------------------------------------------------------------- | Operating margin, | 14.5 | 14.3 | | 13.6 | 12.8 | 13.9 % | 13.3 % | | % | % | % | | % | % | | | -------------------------------------------------------------------------------- | Personnel | 5 261 | 4 390 | 19.8 | 5 261 | 4 390 | | 4 436 | -------------------------------------------------------------------------------- *The operating profit and operating margin are presented excluding the EUR 0.8 million capital gain booked in Q2 2007. January-September orders received totaled EUR 498.9 million (470.9), showing growth of 5.9 percent. The order book increased to EUR 151.6 million (122.8) at end September representing growth of 23.5 percent. Sales in the report period rose by 6.1 percent to EUR 533.7 million (503.0). Operating profit was EUR 72.8 million (64.3) and the operating margin 13.6 percent (12.8). The contract base developed favorably, in terms of both value and number of units. The total number of equipment included in the maintenance contract base increased to 375,605 at end September from 287,460 a year before. The annual value of the contract base increased to EUR 122 million from EUR 104 million respectively. During the third quarter, in addition to organic growth, approximately 39,000 units were added to the contract base mainly due to reviewing and restating the contract base in P&H. Third quarter order intake grew by 9.9 percent and totaled EUR 170.1 million (154.8). Order intake was good in all regions but especially in the APAC and EMEA areas. Compared with the second quarter 2008, order intake was slightly down mainly due to slower orders for modernizations. Third-quarter sales totaled EUR 187.2 million (173.2), representing growth of 8.1 percent compared with a year before. Of the regions, sales grew most in EMEA. The operating profit rose to EUR 27.1 million (24.7), and the operating margin to 14.5 percent (14.3). The number of service technicians at end September was 3,614, which is 461 and 15 percent more than at end September 2007. Since end December 2007 the number of technicians has increased by 433 or 14 percent. In January-September 2008, the number of technicians increased through acquisitions by 224. Standard Lifting -------------------------------------------------------------------------------- | | 7-9/ | 7-9/ | Change | 1-9/ | 1-9/ | R12M | 2007* | | | 2008 | 2007 | percen | 2008 | 2007* | | | | | | | t | | | | | -------------------------------------------------------------------------------- | Orders received, | 223.1 | 188.2 | 18.5 | 690.1 | 559.1 | 874.3 | 743.3 | | MEUR | | | | | | | | -------------------------------------------------------------------------------- | Order book, MEUR | 418.2 | 267.7 | 56.2 | 418.2 | 267.7 | | 270.9 | -------------------------------------------------------------------------------- | Sales, MEUR | 206.7 | 163.4 | 26.5 | 579.0 | 452.0 | 765.8 | 638.9 | -------------------------------------------------------------------------------- | Operating profit, | 38.1 | 25.1 | 51.6 | 99.8 | 61.4 | 128.8 | 90.4 | | MEUR | | | | | | | | -------------------------------------------------------------------------------- | Operating margin, | 18.4 | 15.4 | | 17.2 | 13.6 | 16.8 % | 14.2 % | | % | % | % | | % | % | | | -------------------------------------------------------------------------------- | Personnel | 2 669 | 2 412 | 10.7 | 2 669 | 2 412 | | 2 479 | -------------------------------------------------------------------------------- *The operating profit and operating margin are presented excluding the EUR 8.9 million capital gain booked in Q2 2007. January-September orders received totaled EUR 690.1 million (559.1), showing growth of 23.4 percent. The order book increased to EUR 418.2 million (267.7) at end September representing growth of 56.2 percent. The order book corresponds to more than five months of sales. Sales rose by 28.1 percent to EUR 579.0 million (452.0). Operating profit was EUR 99.8 million (61.4) and operating margin 17.2 percent (13.6). Order intake in the third quarter grew by 18.5 percent and totaled EUR 223.1 million (188.2). Order intake grew in all regions but as a percentage growth was highest in APAC. Compared with the second quarter 2008, order intake declined somewhat, mainly due to slower demand in EMEA. Third-quarter sales totaled EUR 206.7 million (163.4), representing 26.5 percent growth. The operating profit increased to EUR 38.1 million (25.1) and the operating margin to 18.4 percent (15.4). As in the second quarter, the product mix continued to favor components, which was also visible in the high profitability. Heavy Lifting -------------------------------------------------------------------------------- | | 7-9/ | 7-9/ | Change | 1-9/ | 1-9/ | R12M | 2007* | | | 2008 | 2007 | percen | 2008 | 2007* | | | | | | | t | | | | | -------------------------------------------------------------------------------- | Orders received, | 159.1 | 191.8 | -17.1 | 569.6 | 455.1 | 734.9 | 620.4 | | MEUR | | | | | | | | -------------------------------------------------------------------------------- | Order book, MEUR | 531.7 | 434.3 | 22.4 | 531.7 | 434.3 | | 406.1 | -------------------------------------------------------------------------------- | Sales, MEUR | 160.5 | 115.0 | 39.6 | 439.6 | 351.3 | 623.9 | 535.7 | -------------------------------------------------------------------------------- | Operating | 14.5 | 3.8 | 277.5 | 34.8 | 16.6 | 49.8 | 31.6 | | profit, MEUR | | | | | | | | -------------------------------------------------------------------------------- | Operating | 9.0 % | 3.3 % | | 7.9 % | 4.7 % | 8.0 % | 5.9 % | | margin, % | | | | | | | | -------------------------------------------------------------------------------- | Personnel | 1 393 | 1 269 | 9.8 | 1 393 | 1 269 | | 1 272 | -------------------------------------------------------------------------------- *The operating profit and operating margin are presented excluding the EUR 7.9 million capital gain booked in Q2 2007. January-September orders received totaled EUR 569.6 million (455.2), showing growth of 25.1 percent. The order book increased to EUR 531.7 million (434.3) at end September representing growth of 22.4 percent. The order book corresponds to about 10 months of sales. Sales rose by 25.1 percent to EUR 439.6 million (351.3). Operating profit was EUR 34.8 million (16.6) and operating margin 7.9 percent (4.7). Order intake in the third quarter was 17.1 percent less than a year ago and totaled EUR 159.1 million (191.8). Order intake in lift trucks and process cranes continued strong in all regions, but the total orders received decreased due to low orders for port and shipyard cranes. Compared with the second quarter 2008, order intake was stable for process cranes but declined substantially for port equipment. Third-quarter sales totaled EUR 160.5 million (115.0), representing 39.6 percent growth. The operating profit increased to EUR 14.5 million (3.8) and the operating margin rose to 9.0 percent (3.3). Improvement in the margin was supported by favorable product mix as well as the fact that the margin a year before was burdened by supply chain bottlenecks and cost overruns in some projects. Group Overhead Unallocated Group overhead costs in the reporting period were EUR -31.4 million (-24.6), representing 2.2 percent of sales (2.0). SHARE CAPITAL, SHARES AND STOCK OPTIONS The company's registered share capital at 30 September 2008 totaled EUR 30.1 million. At 30 September 2008, the number of shares including treasury shares totaled 61,424,020. In January 2008, EUR 1.6 million was used for repurchases of own shares on the basis of the authorization of the 2007 AGM and the decision of Konecranes Board in 2007. At 30 September, Konecranes held a total of 2,542,600 treasury shares, which corresponds to 4.1 percent of the total number of shares and which at that date had a market value of EUR 42.2 million. The AGM in March 2008 authorized the Board of Directors to resolve to repurchase a maximum of 6,097,878 of the company's own shares. The authorization is valid until the next Annual General Meeting of Shareholders, however no longer than until 12 September 2009. The Board of Directors did not exercise this authorization to buy own shares during the report period. The AGM in March 2008 authorized the Board of Directors to resolve upon share issue as well as upon issue of stock option rights, convertible bonds and other special rights entitling to shares. Shares issued on the basis of the authorization are new shares of the company. The authorization is limited to issuance of a maximum of 12,195,756 shares. The authorization does not concern resolving upon a personnel stock option plan. Details of the authorization are explained in more detail in the release covering the resolutions of the AGM, which is available on the company's website at www.konecranes.com. Pursuant to Konecranes' stock option plans, 52,600 new shares were subscribed for and registered in the Finnish Trade Register during the third quarter. As a result of these subscriptions, the total number of Konecranes shares increased to 61,424,020 shares. The outstanding stock options at the end of September entitle holders to subscribe a total of 2,599,700 shares. The terms and conditions of the stock option programs are available on Konecranes' website at www.konecranes.com. MARKET CAPITALIZATION AND TRADING VOLUME The closing price for Konecranes Plc's shares on 30 September, 2008 was EUR 16.61. The volume-weighted average share price in January-September was EUR 23.37, the highest price being EUR 32.50 in May and the lowest EUR 15.40 in September. In January-September, the trading volume totaled 134 million Konecranes Plc's shares, corresponding to a turnover of approximately EUR 3,124 million and an annualized turnover rate of approximately 290 percent of the total number of outstanding shares. The daily average trading volume was 701,275 shares, representing a daily average turnover of EUR 16.4 million. On 30 September, 2008, the total market capitalization of Konecranes Plc's shares was EUR 1,020.3 million, including treasury shares held by the company. FLAGGING NOTIFICATIONS Barclay Global Investors UK Holdings Ltd informed Konecranes that the total number of shares owned by the group totaled 3,444,786 on February 28, 2008, corresponding to 5.64 percent of the paid up share capital of Konecranes. No other disclosures of changes in holdings were received during the report period. EVENTS AFTER THE END OF THE REPORTING PERIOD Barclay Global Investors UK Holdings Ltd informed Konecranes that the total number of shares owned by the group totaled 2,999,322 on October 9, 2008, corresponding to 4.88 percent of the paid up share capital of Konecranes. Ilmarinen Mutual Pension Insurance Company informed Konecranes that the total number of shares owned by the group totaled 3,126,689 on October 16, 2008, corresponding to 5.09 percent of the paid up share capital of Konecranes. No other disclosures of changes in holdings were received until the release of this report. SHORT-TERM RISKS We have assessed that the principal short-term risks and uncertainties relate to general developments in the world economy, and to the prices and availability of certain components. If the turmoil in the financial markets develops into a widespread shortage of credit and thus into a general global economic downturn, demand for Konecranes's products and services could be affected and potentially lead to postponed projects, cancellations of orders and credit losses. Currency rate fluctuations can significantly affect the company's performance. The USD/EUR exchange rate has the largest impact on financial performance through a combination of the translational effect and transactional exposure. The combined impact of a depreciation of one percentage point in the USD/EUR rate is somewhat more than EUR -1 million in operating profit annually, excluding the effect of currency hedging. FUTURE PROSPECTS The underlying demand for lifting equipment and services is solid but the effects of the financial crisis have started to become visible. In the fourth quarter specifically, fears of a shortage of credit are affecting customer behavior so that the order intake in the fourth quarter may be lower than in the third quarter 2008. However, Konecranes is well equipped to face the uncertainty in the world economy. The high share of its business is in services, which are considered to be more stable also in a slower economic environment, and almost half of the new equipment business comes from emerging markets. Konecranes also has a strong financial position which is highly appreciated by customers. The financial outlook for 2008 is unchanged. Konecranes targets the full year sales to increase by 15-20 percent compared with 2007. The operating margin is targeted to exceed the comparable level of 10.0 percent (excluding capital gain) achieved in 2007. This interim report is unaudited. Helsinki, 29 October, 2008 Konecranes Plc Board of Directors Disclaimer It should be noted that certain statements in this report, which are not historical facts, including, without limitation, those regarding - expectations for general economic development and market situation, - expectations for general developments in the industry, - expectations regarding customer industry profitability and investment willingness, - expectations for company growth, development and profitability, - expectations regarding market demand for the company's products and services, - expectations regarding the successful completion of acquisitions on a timely basis and our ability to achieve the set targets and synergies, - expectations regarding competitive conditions, - expectations regarding cost savings, - and statements preceded by "believes,""expects,""anticipates,""foresees" or similar expressions, are forward-looking statements. These statements are based on current expectations, decisions and plans and currently known facts. Therefore, they involve risks and uncertainties, which may cause actual results to materially differ from the results currently expected by the company. Such factors include, but are not limited to, - general economic conditions, including fluctuations in exchange rates and interest levels, - the competitive situation, especially significant products or services developed by our competitors, - industry conditions, - the company's own operating factors, including the success of production, product development, project management, quality, and timely delivery of our products and services and their continuous development, - the success of pending and future acquisitions and restructurings. SUMMARY FINANCIAL STATEMENTS AND NOTES Accounting Principles The presented financial information is prepared accordance with International Accounting Standard (IAS) 34, Interim Financial Reporting, as adopted by the EU. Konecranes applies the same accounting policies as were applied in the 2007 annual financial statements, except for the change in Segment reporting. The change in the Segment reporting method is that the non-Konecranes branded spare parts business is included in the Service Business area, where previously it was reported in Standard and Heavy Lifting. The spare part business for Konecranes-branded products was included in the Service Business area as of 2007. The 2007 comparison figures according to the new reporting structure are restated accordingly. The key figures in this interim financial report are calculated with same accounting principles than in year 2007 annual financial statements. The calculation rules of key figures are presented in the financial statements of the previous year. The figures presented in the tables below have been rounded to one decimal, which should be taken into account when reading the sum figures. -------------------------------------------------------------------------------- | CONSOLIDATED STATEMENT OF | | | | | | | INCOME - IFRS | | | | | | -------------------------------------------------------------------------------- | EUR million | 7-9/ | 7-9/ | 1-9/ | 1-9/ | Change | 1-12/ | | | 2008 | 2007 | 2008 | 2007* | | 2007* | -------------------------------------------------------------------------------- | Sales | 520,4 | 424,4 | 1 452,1 | 1 227,0 | 18,3 | 1 749,7 | -------------------------------------------------------------------------------- | Other operating | 0,5 | 0,6 | 2,4 | 19,5 | | 20,3 | | income | | | | | | | -------------------------------------------------------------------------------- | Depreciation and | -6.7 | -5.7 | -19.3 | -17.8 | | -24.6 | | impairments | | | | | | | -------------------------------------------------------------------------------- | Other operating | -445.3 | -373. | -1 | -1 096.8 | | -1 553.1 | | expenses | | 8 | 262.9 | | | | -------------------------------------------------------------------------------- | Operating profit | 69.0 | 45.5 | 172.3 | 131.9 | 30.6 | 192.3 | -------------------------------------------------------------------------------- | Share of | -0.8 | 0.4 | -0.4 | 0.7 | | 0.7 | | associate | | | | | | | | companies' and | | | | | | | | joint ventures' | | | | | | | | result | | | | | | | -------------------------------------------------------------------------------- | Financial income | -4.6 | -4.3 | -9.4 | -10.7 | | -14.3 | | and expenses | | | | | | | -------------------------------------------------------------------------------- | Profit before | 63.5 | 41.5 | 162.4 | 121.9 | 33.2 | 178.8 | | taxes | | | | | | | -------------------------------------------------------------------------------- | Taxes | -18.1 | -12.0 | -45.8 | -35.4 | | -49.6 | -------------------------------------------------------------------------------- | Net profit for | 45.4 | 29.5 | 116.6 | 86.6 | 34.7 | 129.2 | | the period | | | | | | | -------------------------------------------------------------------------------- | Net profit for | | | | | | | | the period | | | | | | | | attributable to: | | | | | | | -------------------------------------------------------------------------------- | Shareholders of | 45.4 | 29.5 | 116.5 | 86.6 | | 129.2 | | the parent | | | | | | | | company | | | | | | | -------------------------------------------------------------------------------- | Minority interest | 0.0 | 0.0 | 0.1 | 0.0 | | 0.0 | -------------------------------------------------------------------------------- | Earnings per | 0.77 | 0.49 | 1.99 | 1.45 | 36.9 | 2.17 | | share, basic | | | | | | | | (EUR) | | | | | | | -------------------------------------------------------------------------------- | Earnings per | 0.77 | 0.48 | 1.97 | 1.43 | 38.2 | 2.13 | | share, diluted | | | | | | | | (EUR) | | | | | | | -------------------------------------------------------------------------------- *The income statement is presented including the capital gain on the sale of real estate booked in Q2 2007. -------------------------------------------------------------------------------- | CONSOLIDATED BALANCE SHEET - IFRS | | | | -------------------------------------------------------------------------------- | EUR million | | | | -------------------------------------------------------------------------------- | ASSETS | 30.9.2008 | 30.09.2007 | 31.12.2007 | -------------------------------------------------------------------------------- | Non-current assets | | | | -------------------------------------------------------------------------------- | Goodwill | 59.8 | 58.4 | 56.8 | -------------------------------------------------------------------------------- | Other intangible assets | 63.5 | 61.1 | 59.4 | -------------------------------------------------------------------------------- | Property, plant and equipment | 66.3 | 59.4 | 61.9 | -------------------------------------------------------------------------------- | Advance payments and construction | 4.4 | 5.1 | 4.7 | | in progress | | | | -------------------------------------------------------------------------------- | Investments accounted for using | 3.6 | 6.7 | 6.3 | | the equity method | | | | -------------------------------------------------------------------------------- | Available-for-sale investments | 2.2 | 2.4 | 2.4 | -------------------------------------------------------------------------------- | Long-term loans receivable | 1.5 | 1.0 | 1.7 | -------------------------------------------------------------------------------- | Deferred tax assets | 31.2 | 28.1 | 24.9 | -------------------------------------------------------------------------------- | Total non-current assets | 232.4 | 222.2 | 218.0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Current assets | | | | -------------------------------------------------------------------------------- | Inventories | | | | -------------------------------------------------------------------------------- | Raw material and semi-manufactured | 143.7 | 106.2 | 105.3 | | goods | | | | -------------------------------------------------------------------------------- | Work in progress | 191.1 | 137.2 | 129.9 | -------------------------------------------------------------------------------- | Advance payments | 24.8 | 25.0 | 16.0 | -------------------------------------------------------------------------------- | Total inventories | 359.6 | 268.3 | 251.2 | -------------------------------------------------------------------------------- | Accounts receivable | 372.2 | 307.9 | 328.0 | -------------------------------------------------------------------------------- | Loans receivable | 0.7 | 0.3 | 0.2 | -------------------------------------------------------------------------------- | Other receivables | 28.5 | 23.2 | 18.9 | -------------------------------------------------------------------------------- | Deferred assets | 111.4 | 90.8 | 84.6 | -------------------------------------------------------------------------------- | Cash and cash equivalents | 75.1 | 57.3 | 56.0 | -------------------------------------------------------------------------------- | Total current assets | 947.4 | 747.8 | 738.9 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | TOTAL ASSETS | 1 179.8 | 970.1 | 956.9 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | EQUITY AND LIABILITIES | 30.9.2008 | 30.09.2007 | 31.12.2007 | -------------------------------------------------------------------------------- | Equity attributable to equity | | | | | holders of the parent company | | | | -------------------------------------------------------------------------------- | Share capital | 30.1 | 30.1 | 30.1 | -------------------------------------------------------------------------------- | Share premium account | 39.3 | 39.3 | 39.3 | -------------------------------------------------------------------------------- | Share issues | 0.1 | 0.0 | 0.0 | -------------------------------------------------------------------------------- | Fair value reserves | 2.5 | 4.2 | 3.3 | -------------------------------------------------------------------------------- | Translation difference | -12.8 | -9.2 | -12.9 | -------------------------------------------------------------------------------- | Paid in capital | 6.0 | 5.6 | 4.7 | -------------------------------------------------------------------------------- | Retained earnings | 171.2 | 130.4 | 87.0 | -------------------------------------------------------------------------------- | Net profit for the period | 116.5 | 86.6 | 129.2 | -------------------------------------------------------------------------------- | Total equity attributable to | 353.0 | 287.1 | 280.7 | | equity holders of the parent | | | | | company | | | | -------------------------------------------------------------------------------- | Minority interest | 1.5 | 0.1 | 0.1 | -------------------------------------------------------------------------------- | Total equity | 354.6 | 287.1 | 280.8 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Non-current liabilities | | | | -------------------------------------------------------------------------------- | Interest-bearing liabilities | 34.5 | 74.2 | 45.7 | -------------------------------------------------------------------------------- | Other long-term liabilities | 57.0 | 57.6 | 57.3 | -------------------------------------------------------------------------------- | Deferred tax liabilities | 18.0 | 19.9 | 15.8 | -------------------------------------------------------------------------------- | Total non-current liabilities | 109.5 | 151.8 | 118.8 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Provisions | 41.8 | 30.5 | 37.2 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Current liabilities | | | | -------------------------------------------------------------------------------- | Interest-bearing liabilities | 74.0 | 48.6 | 31.8 | -------------------------------------------------------------------------------- | Advance payments received | 245.8 | 158.7 | 179.1 | -------------------------------------------------------------------------------- | Progress billings | 6.8 | 2.0 | 2.7 | -------------------------------------------------------------------------------- | Accounts payable | 114.5 | 98.5 | 120.4 | -------------------------------------------------------------------------------- | Other short-term liabilities | 24.5 | 25.2 | 22.8 | | (non-interest bearing) | | | | -------------------------------------------------------------------------------- | Accruals | 208.3 | 167.6 | 163.3 | -------------------------------------------------------------------------------- | Total current liabilities | 673.9 | 500.7 | 520.1 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Total liabilities | 825.2 | 682.9 | 676.1 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | TOTAL EQUITY AND LIABILITIES | 1 179.8 | 970.1 | 956.9 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED STATEMENT OF CHANGES IN | | | | | EQUITY - IFRS | | | | -------------------------------------------------------------------------------- | | Equity attributable to equity holders of the parent | | | company | -------------------------------------------------------------------------------- | EUR million | Share | Share | Share | Fair | Translation | | | capita | premium | issues | value | difference | | | l | account | | reserves | | -------------------------------------------------------------------------------- | Balance at | 30.1 | 39.3 | 0.0 | 3.3 | -12.9 | | 1 January, 2008 | | | | | | -------------------------------------------------------------------------------- | Option exercised | | | | | | -------------------------------------------------------------------------------- | Share issue | | | 0.1 | | | -------------------------------------------------------------------------------- | Dividends paid to | | | | | | | equity holders | | | | | | -------------------------------------------------------------------------------- | Dividends paid to | | | | | | | minority interest | | | | | | -------------------------------------------------------------------------------- | Cash flow hedge | | | | -0.8 | | -------------------------------------------------------------------------------- | Translation | | | | | 0.1 | | difference | | | | | | -------------------------------------------------------------------------------- | Share based payments | | | | | | | recognized against | | | | | | | equity | | | | | | -------------------------------------------------------------------------------- | Purchase of treasury | | | | | | | shares | | | | | | -------------------------------------------------------------------------------- | Business | | | | | | | combinations | | | | | | -------------------------------------------------------------------------------- | Net profit for the | | | | | | | period | | | | | | -------------------------------------------------------------------------------- | Balance at | 30.1 | 39.3 | 0.1 | 2.5 | -12.8 | | 30 September, 2008 | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Balance at | 30.0 | 39.0 | 0.0 | 3.7 | -5.8 | | 1 January, 2007 | | | | | | -------------------------------------------------------------------------------- | Option exercised | 0.0 | 0.3 | | | | -------------------------------------------------------------------------------- | Share issue | | | | | | -------------------------------------------------------------------------------- | Dividends paid to | | | | | | | equity holders | | | | | | -------------------------------------------------------------------------------- | Cash flow hedge | | | | 0.5 | | -------------------------------------------------------------------------------- | Translation | | | | | -3.4 | | difference | | | | | | -------------------------------------------------------------------------------- | Share based payments | | | | | | | recognized against | | | | | | | equity | | | | | | -------------------------------------------------------------------------------- | Purchase of treasury | | | | | | | shares | | | | | | -------------------------------------------------------------------------------- | Business | | | | | | | combinations | | | | | | -------------------------------------------------------------------------------- | Minority interest | | | | | | -------------------------------------------------------------------------------- | Net profit for the | | | | | | | period | | | | | | -------------------------------------------------------------------------------- | Balance at | 30.1 | 39.3 | 0.0 | 4.2 | -9.2 | | 30 September, 2007 | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | Equity attributable to equity holders of the parent | | | company | -------------------------------------------------------------------------------- | EUR million | Paid | Retained | Total | Minority | Total | | | in | earnings | | interest | equity | | | Capita | | | | | | | l | | | | | -------------------------------------------------------------------------------- | Balance at | 4.7 | 216.2 | 280.7 | 0.1 | 280.8 | | 1 January, 2008 | | | | | | -------------------------------------------------------------------------------- | Option exercised | 2.9 | | 2.9 | | 2.9 | -------------------------------------------------------------------------------- | Share issue | | | 0.1 | | 0.1 | -------------------------------------------------------------------------------- | Dividends paid to | | -46.8 | -46.8 | | -46.8 | | equity holders | | | | | | -------------------------------------------------------------------------------- | Dividends paid to | | | 0.0 | -0.1 | -0.1 | | minority interest | | | | | | -------------------------------------------------------------------------------- | Cash flow hedge | | | -0.8 | | -0.8 | -------------------------------------------------------------------------------- | Translation | | | 0.1 | | 0.1 | | difference | | | | | | -------------------------------------------------------------------------------- | Share based payments | | 1.8 | 1.8 | | 1.8 | | recognized against | | | | | | | equity | | | | | | -------------------------------------------------------------------------------- | Purchase of treasury | -1.6 | | -1.6 | | -1.6 | | shares | | | | | | -------------------------------------------------------------------------------- | Business | | | 0.0 | 1.5 | 1.5 | | combinations | | | | | | -------------------------------------------------------------------------------- | Net profit for the | | 116.5 | 116.5 | 0.1 | 116.6 | | period | | | | | | -------------------------------------------------------------------------------- | Balance at | 6.0 | 287.7 | 353.0 | 1.5 | 354.6 | | 30 September, 2008 | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Balance at | 0.5 | 156.3 | 223.7 | 0.1 | 223.7 | | 1 January, 2007 | | | | | | -------------------------------------------------------------------------------- | Option exercised | 5.1 | | 5.5 | | 5.5 | -------------------------------------------------------------------------------- | Share issue | | | 0.0 | | 0.0 | -------------------------------------------------------------------------------- | Dividends paid to | | -26.7 | -26.7 | | -26.7 | | equity holders | | | | | | -------------------------------------------------------------------------------- | Cash flow hedge | | | 0.5 | | 0.5 | -------------------------------------------------------------------------------- | Translation | | | -3.4 | | -3.4 | | difference | | | | | | -------------------------------------------------------------------------------- | Share based payments | | 0.9 | 0.9 | | 0.9 | | recognized against | | | | | | | equity | | | | | | -------------------------------------------------------------------------------- | Purchase of treasury | | | 0.0 | | 0.0 | | shares | | | | | | -------------------------------------------------------------------------------- | Business | | | 0.0 | | 0.0 | | combinations | | | | | | -------------------------------------------------------------------------------- | Minority interest | | | 0.0 | 0.0 | 0.0 | -------------------------------------------------------------------------------- | Net profit for the | | 86.6 | 86.6 | | 86.6 | | period | | | | | | -------------------------------------------------------------------------------- | Balance at | 5.6 | 217.0 | 287.1 | 0.1 | 287.1 | | 30 September, 2007 | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED CASH FLOW STATEMENT - IFRS | | | -------------------------------------------------------------------------------- | EUR million | 1-9/2008 | 1-9/2007 | 1-12/2007 | -------------------------------------------------------------------------------- | Cash flow from operating activities | | | | -------------------------------------------------------------------------------- | Net profit for the period | 116.6 | 86.6 | 129.2 | -------------------------------------------------------------------------------- | Adjustments to net profit for the | | | | | period | | | | -------------------------------------------------------------------------------- | Taxes | 45.8 | 35.4 | 49.6 | -------------------------------------------------------------------------------- | Financial income and expenses | 9.7 | 10.7 | 14.5 | -------------------------------------------------------------------------------- | Share of associate companies' and | 0.4 | -0.7 | -0.7 | | joint ventures' result | | | | -------------------------------------------------------------------------------- | Dividend income | -0.3 | 0.0 | -0.2 | -------------------------------------------------------------------------------- | Depreciation and impairments | 19.3 | 17.8 | 24.6 | -------------------------------------------------------------------------------- | Profits and losses on sale of fixed | 0.3 | -17.8 | -18.0 | | assets | | | | -------------------------------------------------------------------------------- | Other adjustments | 0.2 | -0.4 | -0.2 | -------------------------------------------------------------------------------- | Operating income before change in net | 192.0 | 131.6 | 198.7 | | working capital | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Change in interest-free short-term | -52.5 | 4.9 | -14.9 | | receivables | | | | -------------------------------------------------------------------------------- | Change in inventories | -100.2 | -41.9 | -28.3 | -------------------------------------------------------------------------------- | Change in interest-free short-term | 91.8 | 32.1 | 77.6 | | liabilities | | | | -------------------------------------------------------------------------------- | Change in net working capital | -60.9 | -4.8 | 34.4 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Cash flow from operations before | 131.1 | 126.7 | 233.2 | | financing items and taxes | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Interest received | 2.7 | 1.7 | 2.2 | -------------------------------------------------------------------------------- | Interest paid | -5.0 | -9.1 | -10.8 | -------------------------------------------------------------------------------- | Other financial income and expenses | -4.0 | -1.7 | -0.4 | -------------------------------------------------------------------------------- | Income taxes paid | -51.2 | -31.0 | -40.7 | -------------------------------------------------------------------------------- | Financing items and taxes | -57.5 | -40.1 | -49.7 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net cash from operating activities | 73.6 | 86.6 | 183.5 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Cash flow from investing activities | | | | -------------------------------------------------------------------------------- | Acquisition of Group companies, net of | -10.1 | -13.5 | -13.8 | | cash | | | | -------------------------------------------------------------------------------- | Acquisition of shares in associated | 0.0 | 0.0 | 0.0 | | companies | | | | -------------------------------------------------------------------------------- | Investments in other shares | -0.2 | -0.5 | -0.5 | -------------------------------------------------------------------------------- | Capital expenditures | -18.5 | -15.8 | -22.5 | -------------------------------------------------------------------------------- | Proceeds from sale of fixed assets | 0.7 | 31.8 | 32.3 | -------------------------------------------------------------------------------- | Dividends received | 0.3 | 0.0 | 0.2 | -------------------------------------------------------------------------------- | Net cash used in investing activities | -27.8 | 2.0 | -4.4 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Cash flow before financing activities | 45.8 | 88.6 | 179.1 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Cash flow from financing activities | | | | -------------------------------------------------------------------------------- | Proceeds from options exercised and | 3.0 | 5.5 | 6.7 | | share issues | | | | -------------------------------------------------------------------------------- | Purchase of treasury shares | -2.5 | 0.0 | -46.0 | -------------------------------------------------------------------------------- | Proceeds from long-term borrowings | 40.0 | -49.3 | 100.1 | -------------------------------------------------------------------------------- | Repayments of long-term borrowings | -52.9 | 0.0 | -177.8 | -------------------------------------------------------------------------------- | Proceeds from (+), payments of (-) | 33.0 | -3.5 | -20.8 | | short-term borrowings | | | | -------------------------------------------------------------------------------- | Change in long-term receivables | 0.2 | 0.0 | -1.3 | -------------------------------------------------------------------------------- | Change in short-term receivables | -0.5 | -0.7 | 0.0 | -------------------------------------------------------------------------------- | Dividends paid to equity holders of | -46.8 | -26.7 | -26.7 | | the parent | | | | -------------------------------------------------------------------------------- | Dividends paid to minority interest | -0.1 | 0.0 | 0.0 | -------------------------------------------------------------------------------- | Net cash used in financing activities | -26.6 | -74.7 | -165.8 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Translation differences in cash | -0.1 | -1.0 | -1.7 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Change of cash and cash equivalents | 19.2 | 13.0 | 11.6 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Cash and cash equivalents at beginning | 56.0 | 44.4 | 44.4 | | of period | | | | -------------------------------------------------------------------------------- | Cash and cash equivalents at end of | 75.1 | 57.3 | 56.0 | | period | | | | -------------------------------------------------------------------------------- | Change of cash and cash equivalents | 19.2 | 13.0 | 11.6 | -------------------------------------------------------------------------------- The effect of changes in exchange rates has been eliminated by converting the beginning balance at the rates current on the last day of the year. SEGMENT INFORMATION 1. BUSINESS SEGMENTS The 2007 comparison figures by Business Area according to the new reporting structure are presented in the table below. -------------------------------------------------------------------------------- | | Re-sta | Re-st | Re-stat | Re-stat | Re-stat | Reported | | | ted | ated | ed | ed | ed | | -------------------------------------------------------------------------------- | | Q1/07 | Q2/07 | Q3/07 | Q4/07 | 2007* | 2007* | -------------------------------------------------------------------------------- | Service | | | | | | | -------------------------------------------------------------------------------- | Orders received, | 159.0 | 157.2 | 154.8 | 152.4 | 623.4 | 563.0 | | MEUR | | | | | | | -------------------------------------------------------------------------------- | Sales, MEUR | 163.2 | 166.7 | 173.2 | 189.1 | 692.2 | 628.6 | -------------------------------------------------------------------------------- | Operating profit | 18.5 | 21.1 | 24.7 | 27.6 | 91.9 | 78.7 | | (EBIT), MEUR | | | | | | | -------------------------------------------------------------------------------- | Operating margin, | 11.3 | 12.7 | 14.3 | 14.6 | 13.3 | 12.5 | | % | | | | | | | -------------------------------------------------------------------------------- | Standard Lifting | | | | | | | -------------------------------------------------------------------------------- | Orders received, | 183.4 | 187.5 | 188.2 | 184.2 | 743.3 | 793.8 | | MEUR | | | | | | | -------------------------------------------------------------------------------- | Sales, MEUR | 131.8 | 156.8 | 163.4 | 186.9 | 638.9 | 692.6 | -------------------------------------------------------------------------------- | Operating profit | 14.3 | 21.9 | 25.1 | 29.0 | 90.4 | 101.2 | | (EBIT), MEUR | | | | | | | -------------------------------------------------------------------------------- | Operating margin, | 10.9 | 14.0 | 15.4 | 15.5 | 14.2 | 14.6 | | % | | | | | | | -------------------------------------------------------------------------------- | Heavy Lifting | | | | | | | -------------------------------------------------------------------------------- | Orders received, | 114.9 | 148.4 | 191.8 | 165.3 | 620.4 | 633.9 | | MEUR | | | | | | | -------------------------------------------------------------------------------- | Sales, MEUR | 110.6 | 125.8 | 115.0 | 184.4 | 535.7 | 549.0 | -------------------------------------------------------------------------------- | Operating profit | 7.3 | 5.5 | 3.8 | 15.0 | 31.6 | 34.0 | | (EBIT), MEUR | | | | | | | -------------------------------------------------------------------------------- | Operating margin, | 6.6 | 4.4 | 3.3 | 8.1 | 5.9 | 6.2 | | % | | | | | | | -------------------------------------------------------------------------------- | *Operating profit | | | | | | | | (EBIT) and margin, | | | | | | | | excluding the EUR | | | | | | | | 17.6 million | | | | | | | | capital gain | | | | | | | | booked in Q2 2007. | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | EUR million | | | | | | | -------------------------------------------------------------------------------- | Orders received by | 1-9/ | % of | 1-9/ | % of | 1-12/ | % of | | Business Area | 2008 | total | 2007 | total | 2007 | total | -------------------------------------------------------------------------------- | Service 1) | 498.9 | 28 | 470.9 | 32 | 623.4 | 31 | -------------------------------------------------------------------------------- | Standard Lifting | 690.1 | 39 | 559.1 | 38 | 743.3 | 37 | -------------------------------------------------------------------------------- | Heavy Lifting | 569.6 | 32 | 455.1 | 31 | 620.4 | 31 | -------------------------------------------------------------------------------- | ./. Internal | -101.1 | | -84.2 | | -115.1 | | -------------------------------------------------------------------------------- | Total | 1 | 100 | 1 401.0 | 100 | 1 872.0 | 100 | | | 657.5 | | | | | | -------------------------------------------------------------------------------- | 1) Excl. Service | | | | | | | | Contract Base | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | | 30.9. | % of | 30.09. | % of | 31.12.2 | % of | | | 2008 | total | 2007 | total | 007 | total | -------------------------------------------------------------------------------- | Order book total | | | | | | | | 2) | | | | | | | -------------------------------------------------------------------------------- | Service | 151.6 | 14 | 122.8 | 15 | 109.3 | 14 | -------------------------------------------------------------------------------- | Standard Lifting | 418.2 | 38 | 267.7 | 32 | 270.9 | 34 | -------------------------------------------------------------------------------- | Heavy Lifting | 531.7 | 48 | 434.3 | 53 | 406.1 | 52 | -------------------------------------------------------------------------------- | ./. Internal | -36.4 | | -29.9 | | -28.4 | | -------------------------------------------------------------------------------- | Total | 1 | 100 | 794.8 | 100 | 757.9 | 100 | | | 065.2 | | | | | | -------------------------------------------------------------------------------- | 2) Percentage of | | | | | | | | completion | | | | | | | | deducted | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Sales by Business | 1-9/ | % of | 1-9/ | % of | 1-12/ | % of | | Area | 2008 | total | 2007 | total | 2007 | total | -------------------------------------------------------------------------------- | Service | 533.7 | 34 | 503.0 | 39 | 692.2 | 37 | -------------------------------------------------------------------------------- | Standard Lifting | 579.0 | 37 | 452.0 | 35 | 638.9 | 34 | -------------------------------------------------------------------------------- | Heavy Lifting | 439.6 | 28 | 351.3 | 27 | 535.7 | 29 | -------------------------------------------------------------------------------- | ./. Internal | -100.2 | | -79.4 | | -116.9 | | -------------------------------------------------------------------------------- | Total | 1 | 100 | 1 227.0 | 100 | 1 749.7 | 100 | | | 452.1 | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating profit | 1-9/ | EBIT | MEUR | 1-9/ | MEUR | 1-12/ | | (EBIT) by Business | 2008 | % | | 2007 | | 2007 | | Area without gain | MEUR | | | EBIT % | | EBIT % | | on the sale of | | | | | | | | real estate | | | | | | | -------------------------------------------------------------------------------- | Service | 72.8 | 13.6 | 64.3 | 12.8 | 91.9 | 13.3 | -------------------------------------------------------------------------------- | Standard Lifting | 99.8 | 17.2 | 61.4 | 13.6 | 90.4 | 14.2 | -------------------------------------------------------------------------------- | Heavy Lifting | 34.8 | 7.9 | 16.6 | 4.7 | 31.6 | 5.9 | -------------------------------------------------------------------------------- | Group costs | -31.4 | | -24.6 | | -36.8 | | -------------------------------------------------------------------------------- | Consolidation | -3.7 | | -3.3 | | -2.3 | | | items | | | | | | | -------------------------------------------------------------------------------- | Total | 172.3 | 11.9 | 114.4 | 9.3 | 174.7 | 10.0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Total operating | 1-9/ | | 1-9/ | | 1-12/ | | | profit (EBIT) by | 2008 | | 2007 | | 2007 | | | Business Area | | | | | | | -------------------------------------------------------------------------------- | | MEUR | EBIT | MEUR | EBIT % | MEUR | EBIT % | | | | % | | | | | -------------------------------------------------------------------------------- | Service | 72.8 | 13.6 | 65.1 | 12.9 | 92.7 | 13.4 | -------------------------------------------------------------------------------- | Standard Lifting | 99.8 | 17.2 | 70.3 | 15.6 | 99.3 | 15.5 | -------------------------------------------------------------------------------- | Heavy Lifting | 34.8 | 7.9 | 24.5 | 7.0 | 39.5 | 7.4 | -------------------------------------------------------------------------------- | Group costs | -31.4 | | -24.6 | | -36.8 | | -------------------------------------------------------------------------------- | Consolidation | -3.7 | | -3.3 | | -2.3 | | | items | | | | | | | -------------------------------------------------------------------------------- | Total | 172.3 | 11.9 | 131.9 | 10.8 | 192.3 | 11.0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Personnel by | 30.9. | | 30.09. | | 31.12. | | | Business Area | 2008 | | 2007 | | 2007 | | -------------------------------------------------------------------------------- | (at the end of the | | % of | | % of | | % of | | period) | | total | | total | | total | -------------------------------------------------------------------------------- | Service | 5 261 | 55 | 4 390 | 53 | 4 436 | 53 | -------------------------------------------------------------------------------- | Standard Lifting | 2 669 | 28 | 2 412 | 29 | 2 479 | 29 | -------------------------------------------------------------------------------- | Heavy Lifting | 1 393 | 15 | 1 269 | 15 | 1 272 | 15 | -------------------------------------------------------------------------------- | Group staff | 279 | 3 | 213 | 3 | 217 | 3 | -------------------------------------------------------------------------------- | Total | 9 602 | 100 | 8 284 | 100 | 8 404 | 100 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 2. GEOGRAPHICAL | | | | | | | | SEGMENTS | | | | | | | -------------------------------------------------------------------------------- | EUR million | | | | | | | -------------------------------------------------------------------------------- | Sales by market | 1-9/ | % of | 1-9/ | % of | 1-12/ | % of | | | 2008 | total | 2007 | total | 2007 | total | -------------------------------------------------------------------------------- | Europe-Middle | 827.2 | 57 | 653.8 | 53 | 951.4 | 54 | | East-Africa (EMEA) | | | | | | | -------------------------------------------------------------------------------- | Americas (AME) | 413.6 | 28 | 430.2 | 35 | 589.7 | 34 | -------------------------------------------------------------------------------- | Asia-Pacific | 211.3 | 15 | 143.0 | 12 | 208.6 | 12 | | (APAC) | | | | | | | -------------------------------------------------------------------------------- | Total | 1 | 100 | 1 227.0 | 100 | 1 749.7 | 100 | | | 452.1 | | | | | | -------------------------------------------------------------------------------- NOTES: -------------------------------------------------------------------------------- | KEY FIGURES | 1-9/2008 | 1-9/2007 | Change | 1-12/2007 | | | | | % | | -------------------------------------------------------------------------------- | Earnings per share, basic | 1.99 | 1.45 | 37.0 | 2.17 | | (EUR) | | | | | -------------------------------------------------------------------------------- | Earnings per share, diluted | 1.97 | 1.43 | 38.3 | 2.13 | | (EUR) | | | | | -------------------------------------------------------------------------------- | Return on capital employed | 52.3 | 42.0 | 24.5 | 50.4 | | %, Rolling 12 Months (R12M) | | | | | -------------------------------------------------------------------------------- | Return on equity %, Rolling | 49.6 | 47.5 | 4.4 | 51.2 | | 12 Months (R12M) | | | | | -------------------------------------------------------------------------------- | Equity per share, EUR | 6.00 | 4.78 | 25.5 | 4.80 | -------------------------------------------------------------------------------- | Current ratio | 1.3 | 1.4 | -7.1 | 1.3 | -------------------------------------------------------------------------------- | Gearing % | 8.8 | 22.4 | -60.7 | 7.0 | -------------------------------------------------------------------------------- | Solidity % | 38.0 | 35.4 | 7.3 | 36.1 | -------------------------------------------------------------------------------- | EBITDA | 191.6 | 149.7 | 28.0 | 217.0 | -------------------------------------------------------------------------------- | Investments total (excl. | 18.8 | 18.1 | 3.9 | 25.2 | | acquisitions), EUR million | | | | | -------------------------------------------------------------------------------- | Interest-bearing net debt, | 31.1 | 64.2 | -51.5 | 19.7 | | EUR million | | | | | -------------------------------------------------------------------------------- | Net working capital, EUR | 243.1 | 215.8 | 12.6 | 166.4 | | million | | | | | -------------------------------------------------------------------------------- | Average number of personnel | 9 051 | 7 905 | 14.5 | 8 005 | | during the period | | | | | -------------------------------------------------------------------------------- | Average number of shares | 58 | 59 | -1.7 | 59 608 990 | | outstanding, basic | 649 580 | 640 712 | | | -------------------------------------------------------------------------------- | Average number of shares | 59 | 60 | -2.6 | 60 507 038 | | outstanding, diluted | 096 836 | 676 321 | | | -------------------------------------------------------------------------------- | Number of shares | 58 | 60 | -1.9 | 58 505 780 | | outstanding, at end of the | 881 420 | 048 980 | | | | period | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | The period end exchange | 30.9.2008 | 30.09.2007 | Change % | 31.12.2007 | | rates: | | | | | -------------------------------------------------------------------------------- | USD - US dollar | 1.464 | 1.418 | -3.1 | 1.472 | -------------------------------------------------------------------------------- | CAD - Canadian dollar | 1.515 | 1.412 | -6.8 | 1.445 | -------------------------------------------------------------------------------- | GBP - Pound sterling | 0.795 | 0.697 | -12.3 | 0.733 |-------------------------------------------------------------------------------- | CNY - Chinese yuan | 10.026 | 10.643 | 6.2 | 10.752 | -------------------------------------------------------------------------------- | SGD - Singapore dollar | 2.086 | 2.107 | 1.0 | 2.116 | -------------------------------------------------------------------------------- | SEK - Swedish krona | 9.687 | 9.215 | -4.9 | 9.442 | -------------------------------------------------------------------------------- | NOK - Norwegian krone | 8.268 | 7.719 | -6.6 | 7.958 | -------------------------------------------------------------------------------- | AUD - Australian dollar | 1.766 | 1.607 | -9.0 | 1.676 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | The period average | 30.9.2008 | 30.09.2007 | Change % | 31.12.2007 | | exchange rates: | | | | | -------------------------------------------------------------------------------- | USD - US dollar | 1.522 | 1.344 | -11.7 | 1.370 | -------------------------------------------------------------------------------- | CAD - Canadian dollar | 1.549 | 1.484 | -4.2 | 1.468 | -------------------------------------------------------------------------------- | GBP - Pound sterling | 0.782 | 0.676 | -13.5 | 0.684 | -------------------------------------------------------------------------------- | CNY - Chinese yuan | 10.634 | 10.299 | -3.2 | 10.416 | -------------------------------------------------------------------------------- | SGD - Singapore dollar | 2.116 | 2.049 | -3.2 | 2.063 | -------------------------------------------------------------------------------- | SEK - Swedish krona | 9.406 | 9.237 | -1.8 | 9.249 | -------------------------------------------------------------------------------- | NOK - Norwegian krone | 7.983 | 8.062 | 1.0 | 8.016 | -------------------------------------------------------------------------------- | AUD - Australian dollar | 1.668 | 1.637 | -1.8 | 1.635 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONTINGENT LIABILITIES AND | | | | | PLEDGED ASSETS | | | | -------------------------------------------------------------------------------- | EUR million | 30.9.2008 | 30.09.2007 | 31.12.2007 | -------------------------------------------------------------------------------- | Contingent liabilities | | | | -------------------------------------------------------------------------------- | For own debts | | | | -------------------------------------------------------------------------------- | Mortgages on land and buildings | 0.0 | 0.0 | 0.0 | -------------------------------------------------------------------------------- | For own commercial obligations | | | | -------------------------------------------------------------------------------- | Pledged assets | 0.1 | 1.2 | 0.3 | -------------------------------------------------------------------------------- | Guarantees | 223.1 | 227.9 | 255.3 | -------------------------------------------------------------------------------- | Other contingent liabilities and | | | | | financial liabilities | | | | -------------------------------------------------------------------------------- | Leasing liabilities | | | | -------------------------------------------------------------------------------- | Next year | 26.1 | 16.0 | 24.1 | -------------------------------------------------------------------------------- | Later on | 62.3 | 55.4 | 63.7 | -------------------------------------------------------------------------------- | Other | 0.2 | 1.1 | 0.0 | -------------------------------------------------------------------------------- | Total | 311.8 | 301.6 | 343.5 | -------------------------------------------------------------------------------- | Leasing contracts follow the | | | | | normal practices in corresponding | | | | | countries. | | | | -------------------------------------------------------------------------------- | Total by category | | | | -------------------------------------------------------------------------------- | Mortgages on land and buildings | 0.0 | 0.0 | 0.0 | -------------------------------------------------------------------------------- | Pledged assets | 0.1 | 1.2 | 0.3 | -------------------------------------------------------------------------------- | Guarantees | 223.1 | 227.9 | 255.3 | -------------------------------------------------------------------------------- | Other liabilities | 88.6 | 72.5 | 87.9 | -------------------------------------------------------------------------------- | Total | 311.8 | 301.6 | 343.5 | -------------------------------------------------------------------------------- Contingent liabilities relating to litigations Various legal actions, claims and other proceedings are pending against the Group in various countries. These actions, claims and other proceedings are typical for this industry and consistent with a global business offering that encompasses a wide range of products and services. These matters involve contractual disputes, warranty claims, product liability (including design defects, manufacturing defects, failure to warn and asbestos legacy), employment, vehicles and other matters involving claims of general liability. While the final outcome of these matters cannot be predicted with certainty Konecranes is of the opinion, based on the information available to date and considering the grounds presented for such claims, available insurance coverage and the reserves made, that the outcome of such actions, claims and other proceedings, if unfavorable, would not have a material, adverse impact on the financial condition of the Group. -------------------------------------------------------------------------------- | NOMINAL AND FAIR | | | | | | | | VALUES OF DERIVATIVE | | | | | | | | FINANCIAL INSTRUMENTS | | | | | | | -------------------------------------------------------------------------------- | EUR million | 30.9. | 30.9. | 30.09. | 30.09. | 31.12. | 31.12. | | | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 | -------------------------------------------------------------------------------- | | Nomina | Fair | Nomina | Fair | Nominal | Fair | | | l | value | l | value | value | value | | | value | | value | | | | -------------------------------------------------------------------------------- | Foreign exchange | 180.6 | 5.9 | 216.7 | 4.7 | 168.8 | 5.4 | | forward contracts | | | | | | | -------------------------------------------------------------------------------- | Electricity | 1.8 | 0.3 | 1.4 | 0.2 | 0.9 | 0.3 | | derivatives | | | | | | | -------------------------------------------------------------------------------- | Total | 182.4 | 6.2 | 218.2 | 5.0 | 169.7 | 5.7 | -------------------------------------------------------------------------------- Derivatives are used for hedging currency and interest rate risks, as well as the risk of electricity price fluctuations. The Company applies hedge accounting on the derivatives used to hedge cash flows in Heavy Lifting projects. ACQUISITIONS At the end of January 2008 Konecranes strengthened its position in the machine tool service (MTS) business in Scandinavia acquiring the business of the Norwegian MTS company Eiker Automasjon AS. On March 6 Konecranes acquired the entire share capital of Eydimen 2000 S.L., the Spanish crane and service company. Prior to this transaction, Konecranes held 19.2 percent of the share capital in Eydimen. Also at the beginning of March Konecranes acquired additional 62.8 percent of the Finnish company Nostininnovaatiot Oy. Prior stake to this company was 17.4 percent. On March 31 Konecranes signed an agreement to exercise its options to raise its holding in the joint venture company Meiden Hoist System Company, Ltd of Japan from 49.0 to 65.0 percent. During the second quarter Konecranes made two acquisitions. In mid April Konecranes acquired Spanish company Ausió Sistemas de Elevación S.L. The company specializes in manufacturing, sales and service of Industrial cranes and hoists. Also in April Konecranes acquired the Ukrainian service company Craneservice Ukraine. During the third quarter Konecranes acquired three companies. In July Konecranes acquired two MTS companies in United Kingdom; K&B Europe Ltd. and K&B Machine Tool Services Ltd. and in Denmark the port crane service company Aarhus Maskinfabrik A/S. The preliminary fair values of the identifiable assets and liabilities of the acquired businesses at the date of acquisitions are summarized below. -------------------------------------------------------------------------------- | EUR million | 30.9.2008 | 30.9.2008 | -------------------------------------------------------------------------------- | | Recognized on | Carrying | | | acquisition | value | -------------------------------------------------------------------------------- | Intangible assets | 10.9 | 1.2 | -------------------------------------------------------------------------------- | Tangible assets | 1.5 | 1.5 | -------------------------------------------------------------------------------- | Deferred tax assets | 0.4 | 0.4 | -------------------------------------------------------------------------------- | Inventories | 7.8 | 7.2 | -------------------------------------------------------------------------------- | Account receivables and other assets | 15.6 | 16.4 | -------------------------------------------------------------------------------- | Cash and bank | 1.8 | 1.8 | -------------------------------------------------------------------------------- | Total assets | 38.1 | 28.5 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Deferred tax liabilities | 3.4 | 0.0 | -------------------------------------------------------------------------------- | Account payables | 10.0 | 10.0 | -------------------------------------------------------------------------------- | Other liabilities | 10.8 | 10.8 | -------------------------------------------------------------------------------- | Minority interest | 1.4 | 1.4 | -------------------------------------------------------------------------------- | Total liabilities | 25.4 | 22.1 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net assets | 12.7 | 6.4 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Acquisition costs | 16.4 | | -------------------------------------------------------------------------------- | Goodwill | 3.7 | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Cash outflow on acquisition | | | -------------------------------------------------------------------------------- | Acquisition costs | 16.4 | | -------------------------------------------------------------------------------- | Cash flow of earlier interests in | -2.7 | | | acquired businesses | | | -------------------------------------------------------------------------------- | Liabilities assumed | -1.8 | | -------------------------------------------------------------------------------- | Acquisition costs paid in cash | 11.9 | | -------------------------------------------------------------------------------- | Cash and cash equivalents of acquired | -1.8 | | | companies | | | -------------------------------------------------------------------------------- | Net cash flow arising on acquisition | 10.1 | | -------------------------------------------------------------------------------- QUARTERLY FIGURES: STATEMENT OF INCOME - IFRS, QUARTERLY -------------------------------------------------------------------------------- | CONSOLIDATED | | | | | | | | -------------------------------------------------------------------------------- | EUR million | Q3/ | Q2/ | Q1/ | Q4/ | Q3/ | Q2/ | Q1/ | | | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 | -------------------------------------------------------------------------------- | Sales | 520.4 | 492.4 | 439.2 | 522.8 | 424.4 | 422.0 | 380.5 | -------------------------------------------------------------------------------- | Other | 0.5 | 1.3 | 0.6 | 0.8 | 0.6 | 18.2 | 0.7 | | operating | | | | | | | | | income | | | | | | | | -------------------------------------------------------------------------------- | Depreciation | -6.7 | -6.5 | -6.2 | -6.9 | -5.7 | -5.9 | -6.2 | | and | | | | | | | | | impairments | | | | | | | | -------------------------------------------------------------------------------- | Other | -445.3 | -428.9 | -388. | -456.3 | -373.8 | -378.7 | -344.3 | | operating | | | 7 | | | | | | expenses | | | | | | | | -------------------------------------------------------------------------------- | Operating | 69.0 | 58.3 | 45.0 | 60.4 | 45.5 | 55.6 | 30.8 | | profit | | | | | | | | -------------------------------------------------------------------------------- | Share of | -0.8 | 0.2 | 0.2 | 0.1 | 0.4 | 0.5 | -0.2 | | associates' | | | | | | | | | and joint | | | | | | | | | ventures' | | | | | | | | | result | | | | | | | | -------------------------------------------------------------------------------- | Financial | -4.6 | -5.9 | 1.1 | -3.6 | -4.3 | -3.1 | -3.2 | | income and | | | | | | | | | expenses | | | | | | | | -------------------------------------------------------------------------------- | Profit before | 63.5 | 52.6 | 46.3 | 56.9 | 41.5 | 53.0 | 27.4 | | taxes | | | | | | | | -------------------------------------------------------------------------------- | Taxes | -18.1 | -14.7 | -13.0 | -14.3 | -12.0 | -15.4 | -8.0 | -------------------------------------------------------------------------------- | Net profit | 45.4 | 37.9 | 33.3 | 42.6 | 29.5 | 37.6 | 19.5 | | for the | | | | | | | | | period | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED | | | | | | | | | BALANCE SHEET | | | | | | | | | - IFRS | | | | | | | | -------------------------------------------------------------------------------- | EUR million | Q3/ | Q2/ | Q1/ | Q4/ | Q3/ | Q2/ | Q1/ | | | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 | -------------------------------------------------------------------------------- | ASSETS | | | | | | | | -------------------------------------------------------------------------------- | Goodwill | 59.8 | 59.1 | 56.4 | 56.8 | 58.4 | 55.2 | 54.0 | -------------------------------------------------------------------------------- | Other | 63.5 | 63.8 | 60.8 | 59.4 | 61.1 | 52.6 | 54.7 | | intangible | | | | | | | | | assets | | | | | | | | -------------------------------------------------------------------------------- | Property, | 66.3 | 63.4 | 60.6 | 61.9 | 59.4 | 59.0 | 68.2 | | plant and | | | | | | | | | equipment | | | | | | | | -------------------------------------------------------------------------------- | Other | 42.9 | 38.6 | 36.6 | 40.0 | 43.3 | 43.8 | 45.1 | -------------------------------------------------------------------------------- | Total | 232.4 | 224.8 | 214.4 | 218.0 | 222.2 | 210.6 | 221.9 | | non-current | | | | | | | | | assets | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Inventories | 359.6 | 323.5 | 274.6 | 251.2 | 268.3 | 257.2 | 251.6 | -------------------------------------------------------------------------------- | Receivables | 512.7 | 488.6 | 458.7 | 431.7 | 422.2 | 402.3 | 378.6 | | and other | | | | | | | | | current | | | | | | | | | assets | | | | | | | | -------------------------------------------------------------------------------- | Cash and cash | 75.1 | 77.3 | 59.7 | 56.0 | 57.3 | 62.0 | 62.0 | | equivalents | | | | | | | | -------------------------------------------------------------------------------- | Total current | 947.4 | 889.4 | 793.0 | 738.9 | 747.8 | 721.6 | 692.3 | | assets | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Total assets | 1 | 1 | 1 | 956.9 | 970.1 | 932.3 | 914.2 | | | 179.8 | 114.2 | 007.4 | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | EQUITY AND | | | | | | | | | LIABILITIES | | | | | | | | -------------------------------------------------------------------------------- | Total equity | 354.6 | 302.0 | 261.6 | 280.8 | 287.1 | 259.2 | 218.0 | -------------------------------------------------------------------------------- | Non-current | 109.5 | 134.1 | 123.9 | 118.8 | 151.8 | 154.0 | 157.2 | | liabilities | | | | | | | | -------------------------------------------------------------------------------- | Provisions | 41.8 | 38.8 | 35.9 | 37.2 | 30.5 | 27.3 | 27.3 | -------------------------------------------------------------------------------- | Advance | 245.8 | 219.3 | 192.9 | 179.1 | 158.7 | 134.6 | 109.8 | | payments | | | | | | | | | received | | | | | | | | -------------------------------------------------------------------------------- | Other current | 428.1 | 420.0 | 393.1 | 340.9 | 341.9 | 357.1 | 401.9 | | liabilities | | | | | | | | -------------------------------------------------------------------------------- | Total | 825.2 | 812.2 | 745.8 | 676.1 | 682.9 | 673.0 | 696.2 | | liabilities | | | | | | | | -------------------------------------------------------------------------------- | Total equity | 1 | 1 | 1 | 956.9 | 970.1 | 932.2 | 914.2 | | and | 179.8 | 114.2 | 007.4 | | | | | | liabilities | | | | | | | | -------------------------------------------------------------------------------- CONSOLIDATED CASH FLOW STATEMENT - QUARTERLY -------------------------------------------------------------------------------- | EUR million | Q3/ | Q2/ | Q1/ | Q4/ | Q3/ | Q2/ | Q1/ | | | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 | -------------------------------------------------------------------------------- | Cash flow | 76.0 | 64.9 | 51.1 | 67.2 | 51.0 | 43.8 | 36.7 | | before change | | | | | | | | | in net | | | | | | | | | working | | | | | | | | | capital | | | | | | | | -------------------------------------------------------------------------------- | Change in net | -2.0 | -29.9 | -29.0 | 39.2 | 10.5 | -13.1 | -2.2 | | working | | | | | | | | | capital | | | | | | | | -------------------------------------------------------------------------------- | Financing | -22.5 | -20.9 | -14.1 | -9.5 | -9.5 | -18.4 | -12.2 | | items and | | | | | | | | | taxes | | | | | | | | -------------------------------------------------------------------------------- | Net cash from | 51.4 | 14.1 | 8.0 | 96.9 | 52.1 | 12.2 | 22.3 | | operating | | | | | | | | | activities | | | | | | | | -------------------------------------------------------------------------------- | Cash flow | -9.7 | -14.5 | -3.6 | -6.4 | -12.1 | 26.1 | -12.0 | | from | | | | | | | | | investing | | | | | | | | | activities | | | | | | | | -------------------------------------------------------------------------------- | Cash flow | 41.8 | -0.4 | 4.4 | 90.5 | 40.0 | 38.3 | 10.3 | | before | | | | | | | | | financing | | | | | | | | | activities | | | | | | | | -------------------------------------------------------------------------------- | Proceeds from | 0.4 | 2.2 | 0.4 | 1.2 | -0.1 | 3.6 | 2.0 | | options | | | | | | | | | exercised and | | | | | | | | | share issues | | | | | | | | -------------------------------------------------------------------------------- | Purchase of | 0.0 | 0.0 | -2.5 | -46.0 | 0.0 | 0.0 | 0.0 | | treasury | | | | | | | | | shares | | | | | | | | -------------------------------------------------------------------------------- | Change of | -45.3 | 15.1 | 50.0 | -46.3 | -28.7 | -57.0 | 32.3 | | interest-bear | | | | | | | | | ing debt | | | | | | | | -------------------------------------------------------------------------------- | Dividends | 0.0 | 0.0 | -46.8 | 0.0 | 0.0 | 0.1 | -26.8 | | paid to | | | | | | | | | equity | | | | | | | | | holders of | | | | | | | | | the parent | | | | | | | | -------------------------------------------------------------------------------- | Dividends | -0.1 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | | paid to | | | | | | | | | minority | | | | | | | | | interest | | | | | | | | -------------------------------------------------------------------------------- | Net cash used | -45.0 | 17.3 | 1.1 | -91.1 | -28.8 | -53.3 | 7.5 | | in financing | | | | | | | | | activities | | | | | | | | -------------------------------------------------------------------------------- | Translation | 1.0 | 0.8 | -1.8 | -0.7 | -1.0 | 0.1 | -0.1 | | differences | | | | | | | | | in cash | | | | | | | | -------------------------------------------------------------------------------- | Change of | -2.2 | 17.6 | 3.8 | -1.4 | 10.2 | -14.9 | 17.7 | | cash and cash | | | | | | | | | equivalents | | | | | | | | -------------------------------------------------------------------------------- | Cash and cash | 77.3 | 59.7 | 56.0 | 57.3 | 47.1 | 62.0 | 44.4 | | equivalents | | | | | | | | | at beginning | | | | | | | | | of period | | | | | | | | -------------------------------------------------------------------------------- | Cash and cash | 75.1 | 77.3 | 59.7 | 56.0 | 57.3 | 47.1 | 62.0 | | equivalents | | | | | | | | | at end of | | | | | | | | | period | | | | | | | | -------------------------------------------------------------------------------- | Change of | -2.2 | 17.6 | 3.8 | -1.4 | 10.2 | -14.9 | 17.7 | | cash and cash | | | | | | | | | equivalents | | | | | | | | -------------------------------------------------------------------------------- QUARTERLY SEGMENT INFORMATION -------------------------------------------------------------------------------- | EUR million | | | | | | | | -------------------------------------------------------------------------------- | Sales by | Q3/ | Q2/ | Q1/ | Q4/ | Q3/ | Q2/ | Q1/ | | Business Area | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 | -------------------------------------------------------------------------------- | Service | 187.2 | 180.5 | 166.1 | 189.1 | 173.2 | 166.7 | 163.2 | -------------------------------------------------------------------------------- | Standard | 206.7 | 203.9 | 168.3 | 186.9 | 163.4 | 156.8 | 131.8 | | Lifting | | | | | | | | -------------------------------------------------------------------------------- | Heavy Lifting | 160.5 | 144.8 | 134.2 | 184.4 | 115.0 | 125.8 | 110.6 | -------------------------------------------------------------------------------- | ./. Internal | -33.9 | -36.8 | -29.5 | -37.6 | -27.2 | -27.2 | -25.0 | -------------------------------------------------------------------------------- | Total | 520.4 | 492.4 | 439.2 | 522.8 | 424.4 | 422.0 | 380.5 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating | Q3/ | Q2/ | Q1/ | Q4/ | Q3/ | Q2/ | Q1/ | | profit (EBIT) | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 | | by Business | | | | | | | | | Area without | | | | | | | | | gain on the | | | | | | | | | sale of real | | | | | | | | | estate | | | | | | | | -------------------------------------------------------------------------------- | Service | 27.1 | 23.5 | 22.2 | 27.6 | 24.7 | 21.1 | 18.5 | -------------------------------------------------------------------------------- | Standard | 38.1 | 34.9 | 26.8 | 29.0 | 25.1 | 21.9 | 14.3 | | Lifting | | | | | | | | -------------------------------------------------------------------------------- | Heavy Lifting | 14.5 | 12.6 | 7.7 | 15.0 | 3.8 | 5.5 | 7.3 | -------------------------------------------------------------------------------- | Group costs | -9.8 | -10.6 | -11.0 | -12.2 | -5.9 | -10.2 | -8.5 | -------------------------------------------------------------------------------- | Consolidation | -1.0 | -2.0 | -0.7 | 1.0 | -2.3 | -0.3 | -0.7 | | items | | | | | | | | -------------------------------------------------------------------------------- | Total | 69.0 | 58.3 | 45.0 | 60.4 | 45.5 | 38.0 | 30.8 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Orders | Q3/ | Q2/ | Q1/ | Q4/ | Q3/ | Q2/ | Q1/ | | received by | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 | | Business Area | | | | | | | | -------------------------------------------------------------------------------- | Service 1) | 170.1 | 172.6 | 156.1 | 152.4 | 154.8 | 157.2 | 159.0 | -------------------------------------------------------------------------------- | Standard | 223.1 | 244.8 | 222.2 | 184.2 | 188.2 | 187.5 | 183.4 | | Lifting | | | | | | | | -------------------------------------------------------------------------------- | Heavy Lifting | 159.1 | 198.4 | 212.2 | 165.3 | 191.8 | 148.4 | 114.9 | -------------------------------------------------------------------------------- | ./. Internal | -36.3 | -36.5 | -28.2 | -30.9 | -28.4 | -28.0 | -27.8 | -------------------------------------------------------------------------------- | Total | 515.9 | 579.3 | 562.3 | 471.0 | 506.4 | 465.1 | 429.4 | -------------------------------------------------------------------------------- | 1) Excl. | | | | | | | | | Service | | | | | | | | | Contract Base | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Order book by | Q3/ | Q2/ | Q1/ | Q4/ | Q3/ | Q2/ | Q1/ | | Business Area | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 | -------------------------------------------------------------------------------- | Service | 151.6 | 140.2 | 121.8 | 109.3 | 122.8 | 124.5 | 112.9 | -------------------------------------------------------------------------------- | Standard | 418.2 | 387.8 | 338.4 | 270.9 | 267.7 | 239.5 | 211.0 | | Lifting | | | | | | | | -------------------------------------------------------------------------------- | Heavy Lifting | 531.7 | 528.0 | 476.5 | 406.1 | 434.3 | 360.9 | 336.0 | -------------------------------------------------------------------------------- | ./. Internal | -36.4 | -28.3 | -27.0 | -28.4 | -29.9 | -25.1 | -23.1 | -------------------------------------------------------------------------------- | Total | 1 | 1 | 909.7 | 757.9 | 794.8 | 699.8 | 636.8 | | | 065.2 | 027.7 | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Sales by | Q3/ | Q2/ | Q1/ | Q4/ | Q3/ | Q2/ | Q1/ | | market | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 | -------------------------------------------------------------------------------- | Europe-Middle | 298.1 | 285.9 | 243.3 | 297.6 | 238.6 | 227.0 | 188.2 | | East-Africa | | | | | | | | | (EMEA) | | | | | | | | -------------------------------------------------------------------------------- | Americas | 144.1 | 125.1 | 144.3 | 159.6 | 135.4 | 143.1 | 151.7 | | (AME) | | | | | | | | -------------------------------------------------------------------------------- | Asia-Pacific | 78.3 | 81.5 | 51.5 | 65.6 | 50.4 | 51.9 | 40.7 | | (APAC) | | | | | | | | -------------------------------------------------------------------------------- | Total | 520.4 | 492.4 | 439.2 | 522.8 | 424.4 | 422.0 | 380.5 | -------------------------------------------------------------------------------- Analyst and press briefing A presentation for media and analysts will be held at Konecranes office in Helsinki at 12.00 noon Finnish time (address: Eteläesplanadi 22 B, inner court, 2nd floor). The event will be held in English and the interim report will be presented by Konecranes's President and CEO Pekka Lundmark and CFO Teo Ottola. The presentation material will be available on the Company's internet pages at www.konecranes.com after the release of this report. The conference can also be viewed as a live webcast through the internet pages at www.konecranes.com. The archived webcast will be available on the internet pages later during the day. Next report Konecranes 2008 Financial Statements will be published on February 4, 2009. Sender: KONECRANES PLC Sanna Päiväniemi IR Manager For further information, please contact: Mr Pekka Lundmark, President and CEO, tel. +358 20 427 2000 Mr Teo Ottola, Chief Financial Officer, tel. +358 20 427 2040 Ms Sanna Päiväniemi, IR Manager, tel. +358 20 427 2050 Mikael Wegmüller, Director, 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 2007, Group sales totaled EUR 1,750 million. The Group has 9,600 employees, at more than 470 locations in 43 countries. Konecranes is listed on the OMX Nordic Exchange Helsinki (symbol: KCR1V). Distribution Media OMX Nordic Exchange Helsinki www.konecranes.com
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