Annual General Meeting 2019 19 March 2019 Annual General Meeting - - PowerPoint PPT Presentation
CEO Mika Vehvilinen Annual General Meeting 2019 19 March 2019 Annual General Meeting 19 March 2019 1 Agenda 1. Extended Executive Board introduction 2. Financial review 2018 3. Strategic development 4. Sustainability as a driver for
CEO Mika Vehviläinen
19 March 2019 Annual General Meeting 1
19 March 2019 Annual General Meeting 2
Agenda
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Cargotec's Extended Executive Board from 1 April 2019
Mika Vehviläinen CEO Scott Phillips President, Hiab Mikko Puolakka CFO Michel van Roozendaal President, MacGregor Mikael Laine SVP, Strategy Mikko Pelkonen SVP, Human Resources Carina Geber-Teir SVP, Communications Antti Kaunonen President, Kalmar Automation Solutions Soili Mäkinen CIO Outi Aaltonen SVP, General Counsel Stefan Lampa President, Kalmar Mobile Solutions
Kalmar's business operations are reorganised to accelerate growth
* Member of the Executive Board ** Reports to CEO
Business Areas Strategic Business Units
Hiab
Scott Phillips *
MacGregor
Michel van Roozendaal *
Kalmar Mobile Solutions Navis Kalmar Automation Solutions
Antti Kaunonen * Stefan Lampa * Benoit de la Tour **
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Orders received increased by 18%
– Kalmar +23% – Hiab +13% – MacGregor +11%
Net sales increased by 2%
increased by 4%
Operating profit* decreased by 6%
and supply chain bottlenecks
127 149 231 250 259 244 4.0% 4.4% 6.2% 7.1% 8.0% 7.4% 2013 2014 2015 2016 2017 2018 Operating profit* MEUR Operating profit*, %
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Year 2018 at Cargotec – Orders received increased in all business units
* Excluding restructuring costs
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Kalmar The number of containers handled in ports continued to grow Hiab Construction activity at a good level MacGregor The market improved slightly in the merchant ship sector, but
levels
Market environment in 2018
Source: Clarkson Research (number of ships and offshore units) Historical indicative average
827 936 500 1,000 1,500 2,000 2017 2018 75 91 100 200 300 400 500 600 2017 2018 2017 2018 2017 2018 745 782 100 200 300 400 500 600 700 800 2017 2018
Ship and offshore unit order volumes – MacGregor’s demand driver Construction output – Hiab’s demand driver Global container throughput (MTEU) – Kalmar’s demand driver
Merchant ships > 2,000 gt (excl. offshore and miscellaneous) Mobile offshore units United States Europe
Source: Oxford Economics Source: Drewry
+2.9% +3.3%
+4.7%
Historical avg. Historical avg.
+13% +21%
Investment targets in 2018:
efficient products
to Tampere
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We continued investing in the development of our
Orders received increased by 23%
– Five new automation projects – Orders for container handling equipment increased
Operating profit* increased by 8% and
Service business developed favourably
– Comparable growth 9%
Kalmar – Orders received and operating profit increased
0% 3% 5% 8% 10% 20 40 60 80 100 120 140 2013 2014 2015 2016 2017 2018 Operating profit* Operating profit*, %
* Excluding restructuring costs
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MEUR 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2013 2014 2015 2016 2017 2018 Sales Orders received MEUR
Hiab – Demand remained strong, but operating profit declined
200 400 600 800 1,000 1,200 1,400 2013 2014 2015 2016 2017 2018 Sales Orders received 0% 3% 5% 8% 10% 13% 15% 18% 25 50 75 100 125 150 2013 2014 2015 2016 2017 2018 Operating profit* Operating profit*, % MEUR
*) Excluding restructuring costs
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MEUR
Orders received increased by 13%
– Growth in both Europe and Americas
Sales increased by 6%
– Comparable growth in service business 9%
Operating profit* declined compared to the previous year
– Weakening of the US dollar against the euro – Additional costs related to the supply chain
MacGregor – Orders received increased, market environment still challenging
200 400 600 800 1,000 1,200 2013 2014 2015 2016 2017 2018 Sales Orders received 0% 3% 5% 8% 10% 25 50 75 100 2013 2014 2015 2016 2017 2018 Operating profit* Operating profit*, % MEUR
*) Excluding restructuring costs
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MEUR
Orders received increased by 11% Net sales and operating profit* declined,
The market situation is still challenging
Order book
MEUR
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Order book grew strongly
Distribution of order book at the end of 2018
799 805 877 896 786 1,012 203 264 305 286 300 453 980 1,131 883 587 481 630 500 1,000 1,500 2,000 2,500 2013 2014 2015 2016 2017 2018
Kalmar Hiab MacGregor 51% 23% 26% Kalmar Hiab MacGregor
1,980 2,200 2,064 1,769 1,566 1,995
181 204 315 373 253 126 50 100 150 200 250 300 350 400 2013 2014 2015 2016 2017 2018
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Cash flow from operations declined due to the increase in working capital
MEUR
578 719 622 503 472 625 46.7 % 59.2 % 46.4 % 36.0 % 33.1 % 43.8 % 0% 20% 40% 60% 100 200 300 400 500 600 700 800 2013 2014 2015 2016 2017 2018 Interest-bearing net debt, MEUR Gearing, %
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Gearing remained below our target
MEUR
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Progress in M&A in 2018
Effer TTS Kalmar Rough Terrain Center Siwertell
Must-win battles of the strategy period 2015–2018 create a solid base for future
Build world-class leadership Lead digitalisation World-class service offering
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Our model for leadership development is at the heart of succession planning and the development of managerial work 1,800 of our leaders have completed our leadership training We measure leadership and working atmosphere regularly Our teams’ working atmosphere has improved markedly
Effective leadership enables strategy implementation
Strong progress in digitalisation
The world's largest port operator, Cosco, concluded a contract for the deployment of the Navis N4 system Orders received in the software business grew by 33% Digital solutions support industry eco- efficiency Hiab HiConnect to the commercial market MacGregor's new Voyage and Port Optimiser system
Comparable growth in service sales was 6%
Service sales grew in all business units
729 814 883 872 907 932
23% 24% 24% 25% 28% 28% 250 500 750 1,000
2013 2014 2015 2016 2017 2018 Service sales, MEUR % of Cargotec's sales
Service sales
MEUR
Service develops through digitalisation
Kalmar's new innovation centre accelerates the development of services The increase in the amount of data from equipment enables eg. intelligent service solutions Kalmar Insight enables more efficient
Hiab's HiVision now has possibility for remote service MacGregor's OnWatch Scout reduces unplanned downtime
Our vision is to become the market leader in intelligent cargo handling
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VISION GLOBAL MARKET LEADER IN INTELLIGENT CARGO HANDLING MUST-WIN BATTLES
Win through customer centricity Accelerate digitalisation Advance in services Productivity for growth
Annual General Meeting
Emission reduction targets and requirements for transport are being continuously assessed The need for electrification and streamlined transport chains will grow
Climate change will have an impact on the transport sector and the needs of our customers in the future
Image: Espen Rønnevik, Worldcam / Statoil
The offering for eco-efficiency accounted for about 21% of net sales in 2018
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Eco-efficient solutions promote our competitiveness
Systems efficiency Efficiency for environmental industries Emission efficiency Resources efficiency
Profitable and sustainable business requires ethical ways of working
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Ethics and Compliance
Organisation and leadership
top management
Code of Conduct matters regularly
resources on monitoring and change leadership Processes and controls
trainings
acquisitions
also from our partners Speak-Up
to discuss possible concerns
use
investigating and reacting to possible misconduct
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Key figures in 2018
2018 2017 Change Orders received, MEUR 3,756 3,190 +18% Order book, MEUR 1,995 1,566 +27% Sales, MEUR 3,304 3,250 +2% Operating profit, MEUR 190.0 222.1
Operating profit, % 5.8% 6.8%
Restructuring costs, MEUR 53.8 36.5 +48% Operating profit*, MEUR 243.8 258.6
Operating profit*, % 7.4% 8.0%
Net income for the period, MEUR 108.0 132.7
Earnings per share, EUR 1.66 2.05
Equity per share 22.16 22.06 +0% Return on capital employed (ROCE), % 8.0% 9.6 %
Total equity / total assets, % 40.9% 42.2%
* Excluding restructuring costs
Board proposes EUR 1.10 dividend (B share) Dividend to be paid in two instalments of EUR 0.55
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Dividend increases* for the fifth year in a row
0.89 1.11 2.21 1.95 2.05 1.66 0.42 0.55 0.80 0.95 0.00 0.50 1.00 1.50 2.00 2.50
2013 2014 2015 2016 2017 2018 Dividend Earnings per share Payout ratio
50% 36% 49% 47% 51%
*Board proposal to AGM
1.05 1.10
66%
Outlook for 2019
Cargotec expects comparable operating profit for the year 2019 to improve from 2018 (242.1 million euros).
New alternative key figure – Comparable operating profit
Cargotec uses alternative key figures to provide a better picture of the operational development of the business and to improve comparability between reporting periods. From 1 January 2019, Cargotec replaces in its financial reporting the alternative key figure "operating profit before restructuring costs", which was used to monitor the result of
in addition to restructuring costs, capital gains/losses, costs and revenues related to the acquisition and sale of business operations, impairment of assets and refunds, insurance claims and legal costs. Cargotec's comparable operating profit in 2018 is MEUR 242.1 (2017: 258.6).
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