Cargotec's 2016 sales are expected to be at the 2015 level (EUR 3,729 million) or slightly below. Operating profit excluding restructuring costs for 2016 is expected to improve from 2015 (EUR 230.7 million).
Cargotec's CEO Mika Vehviläinen:
Hiab's strong development continued during the third quarter and profitability improved compared to the previous year. Hiab's core business orders were at a good level, but we did not receive any big defence industry orders as we did during the comparison period.
Kalmar's result was also satisfactory; however, the pace of customer decision making has slowed down, which could be seen in declining order numbers. Kalmar's long-term market potential is still strong: bigger ship sizes and the need to develop ports and make operations more effective require investments in port technology and automation. The number of potential projects is still large, but customers are delaying their investment decisions.
The challenging market situation continued in MacGregor. The global merchant ship market is facing overcapacity and new ship orders are at an exceptionally low level. Industry consolidation, alliances and possible new ship routes create uncertainty in the industry. We are continuing with our measures to lower the MacGregor cost level.
Our strategic focus areas are services, digitalisation and leadership development. In services we see tremendous business potential that we need to grasp with increased determination. We have increased our efforts in this area; for example, Hiab opened a spare parts web shop in September, MacGregor strengthened its spare parts delivery cooperation relationships in Asia, and Kalmar has initiated new measures to speed up the growth in services. In terms of digitalisation, we are developing Cargotec IoT Cloud-based solutions with our customers regarding, for example, automation effectiveness and proactive maintenance. Our internal leadership development programme is expanding to the next phase now that the first 200 leaders have completed the intensive training programme.
We are focusing our efforts on projects that improve competitiveness, the cost efficiency of products and digitalisation. Additionally, we are investing in global systems and procedures that in future enable higher efficiency in operational activities as well as in support functions.
Alternative performance measures (APMs) used in Cargotec's financial reporting
New ESMA (European Securities and Markets Authority) guidelines on Alternative Performance Measures (Alternative performance measure (APM) = financial measure other than financial measure defined or specified in IFRS) are effective as of 3 July 2016. The new guidelines have had no impact on performance measures used by Cargotec, but in accordance with the guidelines, Cargotec publishes the explanation of use, definitions as well as reconciliations of its APMs to IFRS financial statements.
APMs are used at Cargotec to better convey the underlying business performance and to enhance comparability from period to period. APMs are not substituting the performance measures stipulated by IFRS, but are instead reported as complementary information.
The alternative performance measures used by Cargotec are:
- Operating profit excluding restructuring costs= Operating profit + restructuring costs
- Operating profit excluding restructuring costs, % of sales = (Operating profit + restructuring costs) / Sales * 100
- Interest-bearing net-debt = Interest-bearing debt - interest-bearing assets +/- Foreign-currency hedge of corporate bonds
Restructuring costs include restructuring provisions, asset impairments and disposals, expenses for vacant premises and other restructuring-related expenses in case of a significant restructuring programme of Cargotec or its business area. In the interim report, the reconciliation of operating profit excluding restructuring costs to operating profit of the statement of income is presented in note 3. Reconciliation of interest-bearing net debt to interest-bearing liabilities and assets is presented in note 6.
Press conference for analysts and media
A press conference for analysts and media, combined with a live international telephone conference, will be arranged on the publishing day at 2:00 p.m. EEST at Cargotec's head office, Porkkalankatu 5, Helsinki. The event will be held in English. The report will be presented by CEO Mika Vehviläinen and Executive Vice President, CFO Mikko Puolakka. The presentation material will be available at www.cargotec.com by 2:00 p.m. EEST.
The telephone conference, during which questions may be presented, can be accessed using the following numbers with access code Cargotec/3575778:
FI: +358 9 7479 0361
SE: +46 8 5033 6574
UK: +44 203 043 2003
US: +1 719 457 1036
The event can also be viewed as a live webcast at www.cargotec.com. An on-demand version of the conference will be published at Cargotec's website later during the day.
For further information, please contact:
Mikko Puolakka, Executive Vice President and CFO, tel. +358 20 777 4105
Hanna-Maria Heikkinen, Vice President, Investor Relations, tel. +358 20 777 4084
Cargotec (Nasdaq Helsinki: CGCBV) is a leading provider of cargo and load handling solutions with the goal of becoming the leader in intelligent cargo handling. Cargotec's business areas Kalmar, Hiab and MacGregor offer products and services that ensure our customers a continuous, reliable and sustainable performance. Cargotec's sales in 2015 totalled approximately EUR 3.7 billion and it employs over 11,000 people. www.cargotec.com