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Thursday, 20 July 2017

Cargotec Corporation (FI) - Cargotec's January-June 2017 half year financial report: Favourable development in profitability

Cargotec Corporation    

Published: 11:00 CEST 20-07-2017 /GlobeNewswire /Source: Cargotec Corporation / : CGCBV /ISIN: FI0009013429

Cargotec's January-June 2017 half year financial report: Favourable development in profitability

CARGOTEC CORPORATION, HALF YEAR FINANCIAL REPORT, 20 JULY 2017 AT NOON EEST

Cargotec's January-June 2017 half year financial report: Favourable development in profitability

-    Kalmar's profitability improved
-    Record high operating profit margin and strong orders received at Hiab
-    Cost savings supported MacGregor's profitability development

April-June 2017 in brief: Profitability improved

·    Orders received decreased 3 percent and totalled EUR 800 (825) million.
·    Order book amounted to EUR 1,720 (31 Dec 2016: 1,783) million at the end of the period.
·    Sales declined 6 percent and totalled EUR 845 (898) million.
·    Service sales totalled EUR 215 (220) million, representing 25 (24) percent of consolidated sales.
·    Software sales increased 26 percent and totalled EUR 44 (35) million.
·    Operating profit excluding restructuring costs was EUR 72.1 (64.8) million, representing 8.5 (7.2) percent of sales.
·    Operating profit was EUR 60.4 (62.6) million, representing 7.2 (7.0) percent of sales.
·    Cash flow from operations before financial items and taxes totalled EUR 40.2 (55.8) million.
·    Net income for the period amounted to EUR 37.5 (40.4) million.
·    Earnings per share was EUR 0.58 (0.63).

January-June 2017 in brief: Strong development at Hiab

·    Orders received decreased 4 percent and totalled EUR 1,657 (1,728) million.
·    Sales declined 5 percent and totalled EUR 1,638 (1,727) million.
·    Service sales totalled EUR 430 (431) million, representing 26 (25) percent of consolidated sales.
·    Software sales increased 27 percent and totalled EUR 79 (63) million.
·    Operating profit excluding restructuring costs was EUR 131.3 (123.3) million, representing 8.0 (7.1) percent of sales.
·    Operating profit was EUR 116.7 (120.2) million, representing 7.1 (7.0) percent of sales.
·    Cash flow from operations before financial items and taxes totalled EUR 52.6 (146.6) million.
·    Net income for the period amounted to EUR 74.0 (79.6) million.
·    Earnings per share was EUR 1.15 (1.23).

Outlook for 2017 unchanged
Cargotec reiterates its outlook published on 8 February 2017 and expects its operating profit excluding restructuring costs for 2017 to improve from 2016 (EUR 250.2 million).

Cargotec's key figures

MEUR

4-6/2017

4-6/2016

Change

1-6/2017

1-6/2016

Change

2016

Orders received

800

825

-3%

1,657

1,728

-4%

3,283

Service orders received

208

236

-12%

434

462

-6%

889

Order book, end of period

1,720

2,033

-15%

1,720

2,033

-15%

1,783

Sales

845

898

-6%

1,638

1,727

-5%

3,514

Service sales

215

220

-2%

430

431

0%

872

Software sales*

44

35

26%

79

63

27%

148

Service and software sales, % of Cargotec's sales

31

28

 

31

29

 

29

Operating profit**

72.1

64.8

11%

131.3

123.3

6%

250.2

Operating profit, %**

8.5

7.2

 

8.0

7.1

 

7.1

Operating profit

60.4

62.6

-3%

116.7

120.2

-3%

197.7

Operating profit, %

7.2

7.0

 

7.1

7.0

 

5.6

Income before taxes

51.4

57.5

-11%

99.4

108.3

-8%

169.1

Cash flow from operations

40.2

55.8

-28%

52.6

146.6

-64%

373.0

Net income for the period

37.5

40.4

-7%

74.0

79.6

-7%

125.3

Earnings per share, EUR

0.58

0.63

-7%

1.15

1.23

-7%

1.95

Net debt, end of period

599

619

-3%

599

619

-3%

503

Gearing, %

42.7

45.5

 

42.7

45.5

 

36.0

Net debt / EBITDA***

2.2

2.1

 

2.2

2.1

 

1.8

Return on capital employed
(ROCE, annualised), %

10.2

11.0

 

10.2

11.0

 

8.8

Personnel, end of period

11,147

11,422

-2%

11,147

11,422

-2%

11,184

*Software sales includes Navis business unit and automation software
**Excluding restructuring costs
***Last four quarters' EBITDA

Cargotec's CEO Mika Vehviläinen: Excellent development at Hiab continued

The development of our business continued to be positive during the second quarter of 2017. The operating profit, excluding restructuring costs, was the highest in Cargotec's history. The business developed particularly well at Hiab, where the orders received increased by 17 percent and profitability improved to a record high level. In Kalmar, the orders received declined compared to last year. Nevertheless, the customer interest in port automation solutions continued to be high. Despite the positive development of container throughput, customers are considering their larger investments carefully. Kalmar's operating profit continued to improve. The market situation for MacGregor is still difficult, even though orders received increased compared to the first quarter. We managed to keep MacGregor's operating profit, excluding restructuring costs, positive also during the second quarter.
 
We are especially pleased with the development of our software business during the second quarter. Our software sales grew strongly during the quarter. We also defined a broader software strategy for Navis, part of Kalmar, during the first half of the year. The strategy offers a more comprehensive set of solutions to optimise the performance of terminals and carriers. Our cloud-based collaboration model will add transparency, efficiency and profitability to the network of ocean carriers, terminal operators and logistics providers.

We are continuing to increase our efficiency as planned. During the second quarter, we announced that we are targeting EUR 50 million savings from 2020 onwards by reducing indirect purchasing spend, streamlining business support processes and establishing Cargotec Business Services operations.

Reporting segments' key figures

Orders received

MEUR

4-6/2017

4-6/2016

Change

1-6/2017

1-6/2016

Change

2016

Kalmar

386

438

-12%

834

892

-7%

1,721

Hiab

279

239

17%

567

514

10%

1,016

MacGregor

136

149

-9%

257

322

-20%

546

Internal orders

-1

0

 

-1

-1

 

-1

Total

800

825

-3%

1,657

1,728

-4%

3,283


Order book

MEUR

30 Jun 2017

31 Dec 2016

Change

Kalmar

926

900

3%

Hiab

290

286

1%

MacGregor

507

598

-15%

Internal orders

-3

-1

 

Total

1,720

1,783

-4%


Sales

MEUR

4-6/2017

4-6/2016

Change

1-6/2017

1-6/2016

Change

2016

Kalmar

403

420

-4%

767

787

-2%

1,700

Hiab

282

283

0%

552

529

4%

1,036

MacGregor

160

196

-18%

320

411

-22%

778

Internal sales

0

0

 

-1

0

 

-1

Total

845

898

-6%

1,638

1,727

-5%

3,514

Operating profit

MEUR

4-6/2017

4-6/2016

Change

1-6/2017

1-6/2016

Change

2016

Kalmar

32.5

31.1

5%

59.2

56.3

5%

115.6

Hiab

44.0

41.3

7%

83.6

73.5

14%

138.8

MacGregor

-3.8

4.3

-188%

-2.0

13.3

-115%

-13.7

Corporate administration
and support functions

-12.4

-14.1

 

-24.1

-22.8

 

-42.9

Total

60.4

62.6

-3%

116.7

120.2

-3%

197.7

 Operating profit excluding restructuring costs

MEUR

4-6/2017

4-6/2016

Change

1-6/2017

1-6/2016

Change

2016

Kalmar

33.2

31.9

4%

61.1

57.5

6%

135.3

Hiab

44.1

41.7

6%

83.6

74.2

13%

140.0

MacGregor

4.9

5.3

-9%

7.3

14.5

-50%

17.9

Corporate administration
and support functions

-10.0

-14.1

 

-20.8

-22.8

 

-42.9

Total

72.1

64.8

11%

131.3

123.3

6%

250.2

Press conference for analysts and media

A press conference for analysts and media, combined with a live international telephone conference, will be arranged on the publishing day at 1.00 p.m. EEST at Cargotec's head office, Porkkalankatu 5, Helsinki. The event will be held in English. The report will be presented by CEO Mika Vehviläinen and Executive Vice President, CFO Mikko Puolakka. The presentation material will be available at www.cargotec.com by latest 12.30 p.m. EEST.

The telephone conference, during which questions may be presented, can be accessed using the following numbers with access code Cargotec/6252467:

FI: +358 9 7479 0361
SE: +46 8 5033 6574
UK: +44 330 336 9105
US: +1 719 325 2202

The event can also be viewed as a live webcast at www.cargotec.com. An on-demand version of the conference will be published at Cargotec's website later during the day.

For further information, please contact:
Mikko Puolakka, Executive Vice President and CFO, tel. +358 20 777 4105
Hanna-Maria Heikkinen, Vice President, Investor Relations, tel. +358 20 777 4084

Cargotec (Nasdaq Helsinki: CGCBV) enables smarter cargo flow for a better everyday with its leading cargo handling solutions and services. Cargotec's business areas Kalmar, Hiab and MacGregor are pioneers in their fields. Through their unique position in ports, at sea and on roads, they optimise global cargo flows and create sustainable customer value. Cargotec's sales in 2016 totalled approximately EUR 3.5 billion and it employs over 11,000 people. www.cargotec.com




Cargotec's half year financial report 2017



This announcement is distributed by Nasdaq Corporate Solutions (One Liberty Plaza, 165 Broadway, New York, NY 10006. Tel: +1 212 401 8700. www.nasdaqomx.com) on behalf of NASDAQ OMX Corporate Solutions clients. Source: Cargotec Corporation, P.O. Box 61, Helsinki FI-00501, Finland
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