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KONE Annual General Meeting 2013 February 25, 2013 Matti Alahuhta, President & CEO
KONE Annual General Meeting 2013February 25, 2013Matti Alahuhta, President & CEO
2012: Strong overall progress and a record high cash flow
2012 2011 Historical change
Comparable change
Orders received MEUR 5,496.2 4,465.1 23.1% 17.4%
Order book MEUR 5,050.1 4,348.2 16.1% 16.5%
Sales MEUR 6,276.8 5,225.2 20.1% 15.2%
Operating income (EBIT) MEUR 821.31) 725.1 13.3%
Operating income (EBIT) % 13.11) 13.9
EBITA MEUR 854.11) 741.2
EBITA % 13.61) 14.2
Cash flow fromoperations(before financing items and taxes)
MEUR 1,055.3 819.8
Basic earnings per share EUR 2.46 2) 2.30 2)
Dividend per share EUR 1.75 3) 1,40 4)
1) Excluding a MEUR 37.3 one-time cost related to the support function development and cost adjustment programs.2) Excluding one-time items. Including one-time items, basic earnings per share was EUR 2.35 in 2012 and EUR 2.52 in 2011.3) Board’s proposal to the AGM.4) In addition, KONE paid an extraordinary dividend of EUR 1.50 per B-share for the financial year 2011.
2 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
0
200
400
600
800
1000
1200
1400
1600
Q1 Q2 Q3 Q4
20052006200720082009201020112012
Orders received: Strong growth in new equipment in Asia-PacificMEUR
3 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
0
200
400
600
800
1000
1200
1400
1600
1800
2000
Q1 Q2 Q3 Q4
20052006200720082009201020112012
Sales: Growth in all businesses with strongest growth in new equipmentMEUR
4 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
0
50
100
150
200
250
300
Q1 Q2 Q3 Q4
20052006200720082009201020112012
Operating income: Growth as a result of good development in all businessesMEUR
Note: Operating income excluding one-time items
5 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
The share of new equipment and Asia-Pacific grew due to strong organic growth and consolidation of GiantKONE
Sales by business
16%
50%
34%
Maintenance Modernization New equipment
Sales by market
16%
35%
49%
EMEA Americas Asia-Pacific
(37%)
(46%) (55%)
(27%)
(18%)
(2011 figures in brackets)
(17%)
6 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
Sales by business 2005–2012 (MEUR)
6 277
34%
16%
50%
2011
5,225
37%
17%
46%
2010
4,987
37%
17%
46%
2009
4,744
34%
19%
47%
2008
4,603
2012
33%
19%
48%
2007
4,079
36%
19%
45%
2006
3,601
40%
19%
41%
2005*
3,242
41%
19%
40%
MaintenanceModernizationNew equipment
CAGR,%
9.9%
7.4%
6.9%
13.5%
*) 2005 figures are pro forma7 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
Sales by market 2005–2012 (MEUR)
16%
35%
6,277
49%
18%
55%
2010 20122011
5,225
27%
4,987
21%
21%
58%
2009
4,744
17%
21%
62%
2008
4,603
16%
19%
65%
2007
4,079
14%
21%
65%
2006
3,601
13%22%
65%
2005*
3,242
12%22%
66%
Asia-PacificAmericasEMEA
CAGR,%
*) 2005 figures are pro forma
9.9%
5.3%
5.3%
27.6%
8 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
EMEA: The new equipment market weakened towards the end of the year
Maintenance markets
New equipment markets
Modernization markets
The market continued to grow, although with clear variation between countries. Price competition was very intense throughout the year.
The market declined slightly in Central and North Europe and declined further from a lower level in South Europe.
In Central and North Europe, the market declined slightly, but remained at a relatively good level.
In South Europe, the demand declined from an already low level.
In the Middle East, demand was strong in Saudi Arabia and started to recover in some other markets.
9 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
Americas: Gradual recovery continued to progress
Maintenance markets
New equipment markets
Modernization markets
Price competition was highly intense, particularly in the non-residential segments.
The market grew slightly.
In the United States, the gradual market recovery continued driven by small and mid-sized projects in the residential and office segments.
In Canada and Mexico, the market growth leveled off as the year progressed.
10 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
Asia-Pacific: Markets grew, although at a slower pace than in 2011
In China, the market grew clearly, although at a slower rate than in 2011.
In India, the market grew slighty despite financing constraints.
In Australia, the market declined slightly.
In Southeast Asia, the market grew throughout the year with the highest growth rates in Malaysia, Indonesia and Thailand.
The market grew throughout the year.
Maintenance markets
New equipment markets
Modernization markets
The modernization demand in Australia declined somewhat.
11 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
Some key highlights and figures in 2012
New equipment orders received grew to 118,000 units (2011: 86,000) and deliveries to 103,000 units (2011: 74,000).
New global volume elevator product range introduced.
Expansion and move of production in Kunshan, China.
Maintenance base exceeded 900,000 elevators and escalators (2011: 850,000).
EGM decided on an extraordinary dividend of EUR 1.50 in addition to the already paid ordinary dividend of EUR 1.40.
12 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
13 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
Good progress in our Development Programs
Service Leadership
Innovative Solutions for People FlowTM
Employee Engagement
Customer Experience
Delivery Chain Excellence
Key achievementsDevelopment programs
Further improved customer loyalty score
New extensive training programs
New global volume elevator offering
Expanded modernization offering
Improved efficiency
Good development in logistics
Further improved working capital rotation
14 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
We measure our performance in five key areas to assess our development
Employee satisfaction
Faster than market growth
Financial performance vs. competition
Sustainability
Customer satisfaction Target: Continuously improved customer loyalty
Target: Continuously improved employee satisfaction
Target: Continue to grow faster than the market
Target: Good progress in the area of sustainability
Target: Better financial development than that of key global competitors
15 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
Market outlook 2013
The new equipment market:– The market in Asia-Pacific is expected to
grow clearly. – The market in Central and North Europe is
expected to decline slightly and the market in South Europe to decline further from an already weak level.
– The market in North America is expected to continue to gradually recover.
The modernization market is expected to be at about the same level as in 2012 or decline slightly.
The maintenance market is expected to continue to develop rather well in most countries.
16 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
Business outlook 2013
KONE’s net sales is estimated to grow by 5–9% at comparable exchange rates as compared to 2012.
The operating income (EBIT) is expected to be in the range of EUR 840–920 million, assuming that translation exchange rates do not materially deviate from the situation of the beginning of 2013.
17 ©KONE Corporation | February 25, 2013 | Annual General Meeting 2013
