KONECRANES PLC HALF-YEAR FINANCIAL REPORT, JANUARY-JUNE 2023 JULY 26, 2023 8:30 am EEST
Konecranes Plc’s Half-year financial report, January-June 2023: Sustained strong performance
Sustained strong performance
This release is a summary of Konecranes Plc’s Half-year financial report, January-June 2023. The complete report is attached to this release in pdf format and is also available on Konecranes’ website at www.konecranes.com.
The figures presented in this report are unaudited. Figures in brackets, unless otherwise stated, refer to the same period a year earlier.
Konecranes has made changes in reporting its orders received and net working capital. The previous year’s figures presented in this report have been restated and are fully comparable with the current year figures.
SECOND QUARTER HIGHLIGHTS
- Order intake EUR 1,092.9 million (1,082.1), +1.0 percent (+3.5 percent on a comparable currency basis), order intake increased in Service and Port Solutions but decreased in Industrial Equipment
- Service annual agreement base value EUR 313.9 million (310.2), +1.2 percent (+4.8 percent on a comparable currency basis)
- Service order intake EUR 374.5 million (366.7), +2.1 percent (+4.7 percent on a comparable currency basis)
- Order book EUR 3,411.4 million (2,825.4) at the end of June, +20.7 percent (+25.1 percent on a comparable currency basis)
- Sales EUR 913.0 million (787.1), +16.0 percent (+18.7 percent on a comparable currency basis), sales increased in all three segments
- Comparable EBITA margin 10.8 percent (7.7) and comparable EBITA EUR 98.3 million (60.9); the increase in the comparable EBITA margin was mainly attributable to higher sales volumes and pricing
- Operating profit EUR 98.0 million (48.2), 10.7 percent of sales (6.1), items affecting comparability totaled EUR -7.7 million (5.8)
- Earnings per share (diluted) EUR 0.71 (0.35)
- Free cash flow EUR 114.0 million (-30.7)
JANUARY–JUNE 2023 HIGHLIGHTS
- Order intake EUR 2,382.5 million (2,179.7), +9.3 percent (+10.4 percent on a comparable currency basis)
- Service order intake EUR 753.3 million (713.5), +5.6 percent (+6.4 percent on a comparable currency basis)
- Sales EUR 1,812.3 million (1,459.2), +24.2 percent (+25.4 percent on a comparable currency basis)
- Comparable EBITA margin 10.7 percent (7.2) and comparable EBITA EUR 193.7 million (105.0); the comparable EBITA margin increased in all three segments
- Operating profit EUR 183.7 million (28.7), 10.1 percent of sales (2.0), items affecting comparability totaled EUR -5.1 million (62.4)
- Earnings per share (diluted) EUR 1.38 (0.09)
- Free cash flow EUR 230.0 million (-28.1)
- Net debt EUR 619.8 million (700.1) and gearing 43.2 percent (55.1)
THIRD QUARTER DEMAND OUTLOOK
The worldwide demand picture remains subject to volatility and uncertainty.
Our demand environment within industrial customer segments has remained good and continues on a healthy level, despite the weakened global macro indicators and some signs of weakening in all three regions.
Global container throughput continues on a high level, and long-term prospects related to global container handling remain good overall. That said, we have started to see hesitation in decision-making in the short term among some port customers.
FINANCIAL GUIDANCE
Konecranes expects net sales to increase in full-year 2023 compared to 2022. Konecranes expects the full-year 2023 comparable EBITA margin to improve from 2022.
KEY FIGURES
|
|
Second quarter
|
January - June
|
|
|
|
|
4-6/
2023
|
4-6/
2022
|
Change
%
|
1-6/
2023
|
1-6/
2022
|
Change
%
|
R12M
|
1-12/
2022
|
|
Orders received, MEUR 1
|
1,092.9
|
1,082.1
|
1.0
|
2,382.5
|
2,179.7
|
9.3
|
4,430.7
|
4,227.9
|
|
Order book at end of period, MEUR
|
|
|
|
3,411.4
|
2,825.4
|
20.7
|
|
2,901.7
|
|
Sales total, MEUR
|
913.0
|
787.1
|
16.0
|
1,812.3
|
1,459.2
|
24.2
|
3,717.9
|
3,364.8
|
|
Comparable EBITDA, MEUR 2
|
118.7
|
82.5
|
43.7
|
236.5
|
148.8
|
58.9
|
493.8
|
406.1
|
|
Comparable EBITDA, % 2
|
13.0%
|
10.5%
|
|
13.1%
|
10.2%
|
|
13.3%
|
12.1%
|
|
Comparable EBITA, MEUR 2
|
98.3
|
60.9
|
61.5
|
193.7
|
105.0
|
84.5
|
407.2
|
318.4
|
|
Comparable EBITA, % 2
|
10.8%
|
7.7%
|
|
10.7%
|
7.2%
|
|
11.0%
|
9.5%
|
|
Comparable operating profit, MEUR 2
|
90.3
|
54.0
|
67.4
|
178.7
|
91.1
|
96.1
|
374.2
|
286.6
|
|
Comparable operating margin, % 2
|
9.9%
|
6.9%
|
|
9.9%
|
6.2%
|
|
10.1%
|
8.5%
|
|
Operating profit, MEUR
|
98.0
|
48.2
|
103.3
|
183.7
|
28.7
|
541.2
|
378.3
|
223.2
|
|
Operating margin, %
|
10.7%
|
6.1%
|
|
10.1%
|
2.0%
|
|
10.2%
|
6.6%
|
|
Profit before taxes, MEUR
|
77.5
|
37.7
|
105.7
|
149.7
|
8.3
|
1,707.3
|
332.1
|
190.7
|
|
Net profit for the period, MEUR
|
56.6
|
27.3
|
107.1
|
109.3
|
6.0
|
1,719.9
|
241.8
|
138.5
|
|
Earnings per share, basic, EUR
|
0.71
|
0.35
|
105.3
|
1.38
|
0.09
|
1,457.7
|
3.06
|
1.77
|
|
Earnings per share, diluted, EUR
|
0.71
|
0.35
|
105.9
|
1.38
|
0.09
|
1,460.2
|
3.05
|
1.77
|
|
Gearing, %
|
|
|
|
43.2%
|
55.1%
|
|
|
48.0%
|
|
Net debt / Comparable EBITDA, R12M 2
|
|
|
|
1.3
|
1.8
|
|
|
1.7
|
|
Return on capital employed, %
|
|
|
|
|
|
|
15.5%
|
9.0%
|
|
Comparable return on capital employed, % 3
|
|
|
|
|
|
|
17.2%
|
13.4%
|
|
Free cash flow, MEUR
|
114.0
|
-30.7
|
|
230.0
|
-28.1
|
|
282.7
|
24.6
|
|
Average number of personnel during the period
|
|
|
|
16,477
|
16,588
|
-0.7
|
|
16,563
|
1) Previous year restated due to the change in reporting for including agreement base sales in orders received
2) Excluding items affecting comparability, see also note 11 in the summary financial statements
3) ROCE excluding items affecting comparability, see also note 11 in the summary financial statements
CEO ANDERS SVENSSON:
Konecranes’ Q2 financial performance was strong. Both orders received and sales grew year-on-year. We posted a record-breaking Q2 comparable EBITA margin of 10.8%, powered by continued good delivery capability and a positive pricing impact. Our all-time high orderbook of €3.4 billion and continued strong performance provide a solid foundation for reaching our new, ambitious financial targets.
Our demand environment remained good in Q2 despite the weakened economic macro-indicators. Order intake increased 3.5% year-on-year on a comparable currency basis, exceeding €1.0 billion once again. This led to an all-time high orderbook of €3.4 billion at the end of June, 25.1% higher than a year ago on a comparable currency basis.
Our delivery capability continued to be as efficient as in the previous quarter. Group sales totaled €913 million and were 18.7% higher versus a year ago on a comparable currency basis. Despite the good sales execution, we encountered some deliveries postponed by customers and global supply chain challenges.
As a result of the higher sales and continued positive pricing impact, we posted a record-high Q2 Group comparable EBITA margin of 10.8%. Profitability improved year-on-year in Service and Industrial Equipment, and was close to the previous year’s level in Port Solutions.
Turning to our Business Segments, Service’s order intake increased 4.7% year-on-year in comparable currencies. Sales increased 17.1% year-on-year in comparable currencies mainly due to volume growth and pricing. The comparable EBITA margin improved once again and was 19.5%. The agreement base value also continued to grow and in comparable currencies was 4.8% higher at the end of Q2 versus a year ago.
Industrial Equipment’s external orders declined 2.0% year-on-year in comparable currencies. External sales increased 19.7% in comparable currencies due to the better delivery capability versus a year ago. Accordingly, the comparable EBITA margin increased year-on-year to 5.4%, mainly driven by sales volumes and pricing.
In Port Solutions, the market environment continued to be good. Order intake grew 5.7% year-on-year in comparable currencies and totaled €420 million. Sales increased 19.8% year-on-year in comparable currencies. Comparable EBITA margin declined slightly to 6.6%, mainly due to sales mix. Once again, Port Solutions ended the quarter with a record-high orderbook of nearly €2.0 billion.
For the remainder of 2023 we expect market volatility and uncertainty to continue. While in Q2 our demand remained good, the macroeconomic indicators continued to signal weakening operating conditions. Although we continue to see some signs of slowing down within our industrial customer segments, we expect demand to remain on a healthy level. Container throughput continues to be on a high level, and long-term prospects related to container handling remain good. That said, we have started to see hesitation in decision-making in the short term among some port customers.
We reiterate our financial guidance for 2023. We expect our net sales to increase in full-year 2023 compared to 2022 and our full-year comparable EBITA margin to improve from 2022. Despite our continued good sales execution in Q2, material availability challenges are not over, and supply chains remain fragile.
At our Capital Markets Day in May we introduced Konecranes’ new financial targets and strategic direction for the coming years. Q2 was an active quarter in terms of M&A, aligned with our updated strategy. In April, we closed the previously announced divestment of MHE-Demag’s Industrial Products (IPD) business. The same month we announced the acquisition of Whiting Corporation’s industrial and nuclear crane and crane service businesses. At the end of June, we acquired the industrial crane service business of Munck Cranes AS in Norway. The two bolt-on acquisitions strengthen our industrial service business with access to new customers and cranes to service.
Overall, we had a good Q2. Our performance reflects our capabilities as a company and ability to improve our profitability, regardless of the uncertainty around us. We have a strong platform to continue to build on and a clear plan to execute to reach our new, ambitious financial targets. We keep working hard to deliver further sales growth and profitability improvement, and to execute our purpose: shaping next generation material handling for a smarter, safer and better world.
ANALYST AND PRESS BRIEFING
A live international webcast and telephone conference for analysts, investors and media will be arranged on the publishing day at 11:30 a.m. EEST. The event will be held in English. The half-year financial report will be presented by President and CEO Anders Svensson and CFO Teo Ottola. Questions may be presented at the end of the conference. The conference will be recorded, and an on-demand version of the conference will be published on the company's website later during the day.
The webcast can be watched through the following link:
https://konecranes.videosync.fi/2023-q2
To ask questions, the telephone conference can be joined by registering through the following link:
https://palvelu.flik.fi/teleconference/?id=10010129
Phone numbers and the conference ID to access the conference will be provided after the registration. In case you would like to ask a question during the conference, please dial *5 on your telephone keypad to enter the question queue.
Questions can also be presented in writing through the question form, while watching the webcast.
NEXT REPORT
Konecranes Plc will publish its January-September 2023 interim report on October 25, 2023.
KONECRANES PLC
Kiira Fröberg
Vice President, Investor Relations
FURTHER INFORMATION
Kiira Fröberg,
Vice President, Investor Relations,
tel. +358 (0) 20 427 2050
IMPORTANT NOTICE
The information in this release contains forward-looking statements, which are information on Konecranes’ current expectations and projections relating to its financial condition, results of operations, plans, objectives, future performance and business. These statements may include, without limitation, any statements preceded by, followed by or including words such as “target,” “believe,” “expect,” “aim,” “intend,” “may,” “anticipate,” “estimate,” “plan,” “project,” “will,” “can have,” “likely,” “should,” “would,” “could” and other words and terms of similar meaning or the negative thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond Konecranes’ control that could cause Konecranes’ actual results, performance or achievements to be materially different from the expected results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding Konecranes’ present and future business strategies and the environment in which it will operate in the future.
Konecranes is a global leader in material handling solutions, serving a broad range of customers across multiple industries. We consistently set the industry benchmark, from everyday improvements to the breakthroughs at moments that matter most, because we know we can always find a safer, more productive and sustainable way. That's why, with around 16,300 professionals in over 50 countries, Konecranes is trusted every day to lift, handle and move what the world needs. In 2022, Group sales totalled EUR 3.4 billion. Konecranes shares are listed on Nasdaq Helsinki (symbol: KCR).
DISTRIBUTION
Nasdaq Helsinki
Major media
www.konecranes.com
