President and CEO Pekka Lundmark said: “The fact that we are able to report all-time high order intake is encouraging. The 31% growth demonstrates our strength in the market place especially when the general economic uncertainty has further increased and the unfavourable exchange rate development lowers our reported Euro growth by six percentage points.”
He added: “The strong first quarter orders have led us to raise our full year sales growth target to approximately 15%. In spite of the increasing raw material prices and unfavourable exchange rates our operating margin increased by more than two percentage points, to 10.2%, compared to the first quarter 2007.”
This, he said, “shows that our target to continue to improve our full year operating margin from previous year’s 10% is fully realistic.”
Summary
Demand remained strong in all business areas.
Group orders received increased 30.9% (+36.9% in comparable currency rates) to all time high Euros 562.3 (429.4) million, boosted by a strong quarter in heavy lifting, and continued high growth in standard lifting.
The increase in orders for process cranes in the Americas, and large port orders in the Europe, Middle East, Africa (EMEA) region boosted order intake in heavy lifting.
Standard lifting achieved strong order growth in EMEA, and in the Asia-Pacific (APAC) region in particular, while orders in the Americas were roughly unchanged at a high level.
In service, reduced modernisation orders and changes in currency rates suppressed order growth. However, in comparable currencies service orders growth continued.
Market Review
Overall market demand for Konecranes’ products and services continued strong in the first quarter of 2008. Industrial production continued to increase at a fast pace in the Asia-Pacific region (APAC), and at a moderate rate in EMEA and the Americas, which resulted in good investment demand in most industry segments.
Strong demand for process cranes and port equipment in Russia and Eastern Europe, and growing demand in the Middle East, contributed to the overall strong demand in the EMEA region.
The demand for standard lifting equipment also improved in EMEA.
In the Americas region, demand for process cranes improved, while demand for standard lifting equipment stabilised at a high level, and demand for port equipment remained at a relatively low level.
Standard lifting enjoyed excellent order, sales and profitability growth in the first quarter of 2008.
Order intake grew 21.2% to Euros 222.2 (183.4) million.
Heavy lifting, meanwhile, “posted exceptionally strong order intake and very good sales growth, but the profitability remained below targets,” Konecranes said.
Order intake grew 84.7% to Euros 212.2 (114.9) million. Port equipment in the EMEA region accounted for a high proportion of the order intake. Process crane orders showed strong growth in the Americas, and continued at a good level in EMEA.
