Finnish crane and lifting specialist, Konecranes has announced that its order intake and its profitability grew in the forth financial quarter of 2014 compared to 2013. Operating profit, without restructuring costs, for the whole year was equable with 2013 being €119.1 million – €115.5 million in 2013.
Order intake in the last quarter of 2014 – ending 31 Dec 2014 – was €513.3 million up 21.6% over the same period in 2013 – €422.2 million. Profit for Q4 was up €4.3 million to €47.1 million for the same period in 2013.
At the year end the order book had a €979.5 million backlog 9.6% higher than 2013.
Konecranes says that European customers are still cautious about investing, but the Purchasing Managers Indexes are giving a reason for continued optimism regarding the US market. The near-term market outlook in emerging markets remains uncertain while continued contract base growth bodes well for the future of the service business.
Based on the order book, service contract base and the near-term demand outlook, Konecranes expects sales in 2015 to be higher than in 2014. The
2015 operating profit, excluding restructuring costs should also improve from 2014.
President and CEO Pekka Lundmark said, “Year 2014 ended with a good quarter. Noteworthy is that both our business areas – service and equipment – improved from the fourth quarter 2013 in all key aspects: orders, sales, operating profit, and operating margin were all higher than a year ago.
“Summarising full year 2014, we can be reasonably satisfied with the fact that our operating profit excluding restructuring costs improved, in spite of net sales dropping by €88 million, to €2011 million. The operating margin excluding restructuring costs improved from 5.5% in 2013 to 5.9% in 2014, which is a good achievement in a volume decline, though still way below our target 10%.
“This was the third consecutive year of operating margin improvement. Systematic restructuring of non-performing units, introduction of new services, and focus on sales management were the principal contributors to the improvement. The main issue in the Service business has been the weak topline growth, but the promising order intake in the second half of the year combined with strong contract base development bodes well for both growth and profitability prospects in 2015.
“I am cautiously optimistic about the year 2015. We started the year with an order backlog that was 9.6% higher than a year ago. The funnel of new opportunities we are working on is also promising. The weakening euro is increasing the competitiveness of our European manufacturing units. Our newly launched products provide new growth opportunities, and cost efficiency programmes are moving forward.
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