As preliminarily communicated in the January-September interim report release on October 20, 2011, Konecranes has initiated actions in the fourth quarter to lower the cost base in Europe.
Within Business Area Service, operations will be restructured in a number of European countries. Planned actions include closing down unprofitable units, merging operations, personnel reductions and streamlining of administration. The estimated need to reduce personnel amounts to approximately 100 employees. The countries estimated to be affected by planned actions are Austria, Belgium, Denmark, Finland, France, Germany, the Netherlands, Norway, Spain, Sweden, the UK and Ukraine.
Konecranes targets annual cost savings of approximately EUR 7 million with these actions. Furthermore, Konecranes expects to book restructuring costs of approximately EUR 6 million due to these actions in the fourth quarter of 2011 of which asset write-downs are estimated to amount to approximately EUR 2 million. These restructuring actions are expected to be implemented by the end of the first quarter of 2012.
Within Business Area Equipment, Konecranes has initiated actions to restructure some of the operations and production in Austria and Germany. Assembly of air balancers in Thalgau, Austria, is planned to be combined with Konecranes’ overall crane component supply chain. In addition, Konecranes’ Industrial Cranes business unit is planning to consolidate its operations in Germany.
These actions are estimated to affect approximately 20 employees in Germany. With these planned actions, Konecranes targets annual cost savings of approximately EUR 2 million. Konecranes expects to incur restructuring costs of approximately EUR 4 million due to these actions in the fourth quarter of 2011 of which asset write-downs are estimated to amount to approximately EUR 2 million. These restructuring actions are expected to be implemented by the end of 2012.
Due to business reorganization, Konecranes will start statutory negotiations regarding possible personnel reductions in Finland. It is estimated that the permanent personnel reductions will affect 9 employees at most within Business Area Service and in Konecranes IT. Planned changes within the Business Area Service are part of the European-wide restructuring of operations. Konecranes IT intends to rebuild its Service Delivery organization, which may have an impact on the current IT-related business structures and responsibilities.
All the above-mentioned actions are estimated to affect approximately 125 employees in total within the Konecranes Group. With these planned actions, Konecranes targets annual cost savings of approximately EUR 9 million in total. Konecranes expects to incur restructuring costs of approximately EUR 10 million in total due to these actions in the fourth quarter of 2011 of which asset write-downs are estimated to amount to approximately EUR 4 million in total.
Konecranes repeats the 2011 financial guidance: We forecast the 2011 operating profit, excluding possible restructuring costs, to be approximately on the same level as in 2010. Sales are expected to be higher than in 2010. Business Area Service operating profit in 2011 is expected to fall short of 2010 level. The 2011 operating profit of the Business Area Equipment is forecasted to increase from 2010.
KONECRANES PLC
Miikka Kinnunen, Director, Investor Relations
FURTHER INFORMATION
Investors and analysts:
Miikka Kinnunen, Director, Investor Relations
E-mail: [email protected] or phone +358 20 427 2050
Teo Ottola, CFO
E-mail: [email protected] or phone +358 50 5211 064
Media:
Mikael Wegmüller, Vice President, Marketing and Communications
E-mail: [email protected] or phone +358 20 427 2008
Konecranes is a world-leading group of Lifting Businesses™, serving a broad range of customers, including manufacturing and process industries, shipyards, ports and terminals. Konecranes provides productivity-enhancing lifting solutions as well as services for lifting equipment and machine tools of all makes. In 2010, Group sales totaled EUR 1,546 million. The Group has 11,400 employees at 578 locations in 46 countries. Konecranes is listed on the NASDAQ OMX Helsinki (symbol: KCR1V).
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