This release is a summary of Konecranes Plc’s Financial statement release 2022. 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.

Since the beginning of June, Service and Industrial Equipment have been focused under the same leadership. Following this change, Konecranes has two Business Areas: Industrial Service and Equipment, and Port Solutions. Konecranes continues to report three segments: Service, Industrial Equipment, and Port Solutions, and the segment figures are comparable with historical figures.

FOURTH QUARTER HIGHLIGHTS

– Order intake EUR 879.1 million (892.3), -1.5 percent (-4.5 percent on a comparable currency basis), order intake decreased in Service but increased in Industrial Equipment and Port Solutions

– Service annual agreement base value EUR 306.9 million (290.4), +5.7 percent (+3.4 percent on a comparable currency basis)

– Service order intake EUR 283.2 million (307.7), -7.9 percent (-13.7 percent on a comparable currency basis)

– Order book EUR 2,901.7 million (2,036.8) at the end of December, +42.5 percent (+41.1 percent on a comparable currency basis)

– Sales EUR 1,020.9 million (948.9), +7.6 percent (+4.4 percent on a comparable currency basis), sales increased in Service and Industrial Equipment but decreased in Port Solutions

– Adjusted EBITA margin 11.6 percent (11.9) and adjusted EBITA EUR 118.2 million (113.2); the decrease in the adjusted EBITA margin was mainly attributable to lower underlying sales volumes

– Operating profit EUR 103.0 million (86.0), 10.1 percent of sales (9.1), adjustments totaled EUR 8.2 million (19.0), mainly comprising of restructuring costs

– Earnings per share (diluted) EUR 0.91 (0.86)

– Free cash flow EUR 90.8 million (65.7)

FULL YEAR 2022 HIGHLIGHTS

– Order intake EUR 3,928.9 million (3,175.5), +23.7 percent (+19.2 percent on a comparable currency basis)

– Service order intake EUR 1,161.9 million (1,078.3), +7.8 percent (+1.5 percent on a comparable currency basis)

– Sales EUR 3,364.8 million (3,185.7), +5.6 percent (+1.8 percent on a comparable currency basis)

– Adjusted EBITA margin 9.5 percent (9.8) and adjusted EBITA EUR 318.4 million (312.2); the adjusted EBITA margin increased in Service but decreased in Industrial Equipment and Port Solutions

– Operating profit EUR 223.2 million (220.0), 6.6 percent of sales (6.9), adjustments totaled EUR 63.5 million (59.1), mainly comprising of costs related to the impacts of the war in Ukraine, merger related costs, and restructuring costs

– Earnings per share (diluted) EUR 1.77 (1.85)

– Free cash flow EUR 24.6 million (137.7)

– Net debt EUR 688.3 million (541.6) and gearing 48.0 percent (39.8)

– The Board of Directors proposes a dividend of EUR 1.25 (1.25) per share for 2022

FIRST QUARTER DEMAND OUTLOOK

The worldwide demand picture remains subject to volatility and uncertainty.

Despite the weakened global macro indicators, our overall demand environment within industrial customer segments has remained good and continues on a healthy level. That said, we have started to see some signs of weakening in all three regions.

Global container throughput continues high, and long-term prospects related to global container handling remain good overall.

FINANCIAL GUIDANCE

Konecranes expects net sales to increase in full-year 2023 compared to 2022. Konecranes expects the full-year 2023 adjusted EBITA margin to improve from 2022.

CEO ANDERS SVENSSON:

2022 was a year like no other, without question. In addition to the terrible war in Ukraine, we faced accelerated inflation, continued global supply chain constraints and increased market uncertainty – all this while still dealing with COVID-19 pandemic. Despite the many challenges, Konecranes ended 2022 with a solid performance. Order intake remained good, and delivery capability continued to improve. Our quarterly and full-year adjusted EBITA margins did not reach last year’s levels, but Konecranes has demonstrated its ability to navigate in the most challenging of environments, and I am proud of the hard work and dedication of our whole team.

While market uncertainty continued in the fourth quarter and macro-economic indicators are signaling weakening market conditions, our overall demand sentiment remained solid. The 4.5% year-on-year decrease in Group order intake in comparable currencies was mainly due to Business Segment Service’s tough comparison period, which included a large modernization order. Short-cycle orders remained on a healthy level and sequentially grew slightly, indicating that our customers continued to place orders despite the uncertainty.

In Q4, our sales execution improved again compared to the previous quarters. Quarterly sales exceeded €1 billion and grew 4.4% in comparable currencies from the previous year. That said, we continued to face component availability challenges and other supply chain constraints, and COVID-19 hampered our performance in APAC. At the year-end, our orderbook was 41.1% higher than a year ago on a comparable currency basis, reflecting both the strong order intake during the year as well as delivery challenges.

Despite the sales growth, profitability declined slightly in Q4. Our 11.6% adjusted EBITA margin was slightly behind last year’s record level. The decrease was mainly driven by lower underlying sales volumes, particularly in Port Solutions.

Turning to our Business Segments, Service’s order intake declined 13.7% year-on-year in comparable currencies. Excluding the comparison period’s large modernization order, Service order intake grew year-on-year. Sales increased 7.7% year-on-year in comparable currencies mainly thanks to pricing, leading to slightly improved profitability and an adjusted EBITA margin of 21.1%. The agreement base value also continued to grow and was 3.4% higher in comparable currencies at the end of Q4 versus a year ago.

Industrial Equipment’s external order intake grew 2.9% year-on-year in comparable currencies. Although customer delays and supply chain constraints continued to impact sales execution, external sales increased 9.2% in comparable currencies. The adjusted EBITA margin declined slightly year-on-year to 6.0%, mainly due to inflation. However, the year-on-year profitability gap continued to narrow from the previous quarters, reflecting the positive impact of the price increases implemented earlier last year. We expect the positive pricing impact to continue in 2023.

In Port Solutions, the market environment continued to be favorable. Order intake totaled €356 million and included a large automation order. Sales decreased as expected, down 2.6% year-on-year in comparable currencies mainly due to orderbook timing. At the same time, project execution had a negative impact on the adjusted EBITA margin, which declined to 6.5%. Following the strong 2022 market sentiment and order intake, Port Solutions ended the year with a record-high orderbook of €1.6 billion.

Looking into 2023, we expect the market volatility and uncertainty to continue. Although our demand environment has remained solid so far, we have started to see some signs of slowing down within our industrial customer segments also outside of Europe. We have updated our Q1 demand outlook to reflect the current market sentiment.

We have also given financial guidance for the year that has started. We expect our net sales to increase in full-year 2023 compared to 2022 and our full-year adjusted EBITA margin to improve from 2022. Although our delivery capability has improved, material availability challenges and supply chain constraints are not over, and we expect them to continue to impact our performance this year. At the same time, our high orderbook and the pricing actions we took last year provide a solid foundation for the new year and give us confidence amidst the market uncertainty.

Finally, I am proud and excited to lead Konecranes as its new President and CEO. At the time of my appointment, I referred to Konecranes as a global industry leader with strong heritage, unique offering and footprint, and great people. My first months at the company have only confirmed my initial impressions. Konecranes has many good qualities to build on, and we have much to achieve. That said, a lot of work lies ahead of us. Together with the Konecranes Leadership Team, I look forward to hosting our Capital Markets Day in Helsinki on May 10, 2023, to share what’s next for our company.
Source: Konecranes