© 2012 Konecranes. All rights reserved.
FINANCE CMD, SEPTEMBER 11, 2012
Teo Ottola, CFO
10.9.2012 Finance/ Teo Ottola1
© 2012 Konecranes. All rights reserved.
CONTENTS
• Growth and profitability• Capital structure
10.9.2012 Finance/ Teo Ottola2
© 2012 Konecranes. All rights reserved.
GROWTH AND PROFITABILITY
10.9.2012 Finance/ Teo Ottola3
© 2012 Konecranes. All rights reserved.
WE HAVE DELIVERED STRONG GROWTH OVER THE CYCLE
0
500
1000
1500
2000
2500
MEUR Sales Acquisitions
2002 - 201111% CAGR6% ORGANIC GROWTH
10.9.2012 Finance/ Teo Ottola4
© 2012 Konecranes. All rights reserved.
PROFITABILITY DEVELOPMENT
0 %
2 %
4 %
6 %
8 %
10 %
12 %
14 %
0
500
1 000
1 500
2 000
2 500
2004 2005 2006 2007 2008 2009 2010 2011 R12M
Net sales Clean EBITDA margin Clean EBITA (bf. PPA) margin Clean EBIT margin
*Clean figures refer to the result before restructuring costs and capital gains
10.9.2012 Finance/ Teo Ottola5
R12M profitability below 2008 due to:• Sales down in organic terms• Increased investments in business
infrastructure and development• Costs of footprint expansion• Price/mix
© 2012 Konecranes. All rights reserved.
CAPEX, ACQUISITIONS, DEPRECIATION AND AMORTIZATION
0
10
20
30
40
50
60
70
80
90
2004 2005 2006 2007 2008 2009 2010 2011 R12M
EURm
Capex Capex (cash flow based) M&A PPA D&A excl. PPA
10.9.2012 Finance/ Teo Ottola6
© 2012 Konecranes. All rights reserved.
CURRENT COST ISSUES ON THE FIXED COST SIDE VS. 2008
0 %
10 %
20 %
30 %
40 %
50 %
60 %
2003 2004 2005 2006 2007 2008 2009 2010 2011 R12M
% o
f sa
les
Materials, supplies, subcontracting Personnel Other operating expenses
10.9.2012 Finance/ Teo Ottola7
© 2012 Konecranes. All rights reserved.
BULK OF THE FIXED COSTS ARE IN FRONT LINES AND SUPPORT, NOT IN SUPPLY
Fixed costs - front lines
Fixed costs - supply
Shared business area resources
Shared regional and country resources
Common business infrastructure and development
Unallocated group costs
10.9.2012 Finance/ Teo Ottola8
*2011 figures excl. depreciation
© 2012 Konecranes. All rights reserved.
FIXED COST ITEMS ABOVE 2008 LEVEL ARE SHARED RESOURCES AND DEVELOPMENT
0
50
100
150
200
250
2008 2009 2010 2011
Index
Indexed fixed cost development 2008-2011
Fixed costs - front lines
Fixed costs - supply
Shared business area resources
Shared regional and country resources
Common business infrastructure and development
Unallocated group costs
10.9.2012 Finance/ Teo Ottola9
© 2012 Konecranes. All rights reserved.
RELATIVE SIZE OF SOURCING CLUSTERS
Steel
Mechanics
Electrics
Subcontracting
Logistics
Indirect
10.9.2012 Finance/ Teo Ottola10
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CAPITAL STRUCTURE
10.9.2012 Finance/ Teo Ottola11
© 2012 Konecranes. All rights reserved.
NWC BREAKDOWN
0
200
400
600
800
1000
1200
0 %2 %4 %6 %8 %10 %12 %14 %16 %18 %20 %22 %
2004 2005 2006 2007 2008 2009 2010 2011 Q2/12
MEU
R
Inventories ReceivablesOther assets Advances received & progress billingsAccounts payable Other liabilitiesNWC/sales
10.9.2012 Finance/ Teo Ottola12
© 2012 Konecranes. All rights reserved.
80 %88 %
57 %
7 %3 %
-19 %
-4 %
50 %
65 %
-40 %
-20 %
0 %
20 %
40 %
60 %
80 %
100 %
-150
-100
-50
0
50
100
150
200
250
300
350
400
450
500
2004 2005 2006 2007 2008 2009 2010 2011 Q2/12
MEUR Equity Net debt Net debt/Equity
OPTIMAL LONG-TERM GEARING AT 50-80%
10.9.2012 Finance/ Teo Ottola13
© 2012 Konecranes. All rights reserved.
HISTORICAL NET DEBT/EBITDA
2,5
2,1
1,0
0,1 0,0
-0,6
-0,1
1,51,7
-1,0x
-0,5x
0,0x
0,5x
1,0x
1,5x
2,0x
2,5x
3,0x
-100
-50
0
50
100
150
200
250
300
2004 2005 2006 2007 2008 2009 2010 2011 Q2/12
MEUR EBITDA Net debt Net debt/EBITDA
10.9.2012 Finance/ Teo Ottola14
© 2012 Konecranes Plc. All rights reserved.
0
100
200
300
400
500
600
700
800
EURm Q2 /2012
Cash
Undrawn Committed Credit Facility
Drawn Revolving Credit
Short Term Debt
Drawn Revolving Credit
Commercial Papers
Other Long Term Debt
Pension Loan
Term Loan
Bond
DEBT AND MATURITY STRUCTURE
ACTUAL MATURITY
10.9.2012 Finance/ Teo Ottola15
© 2012 Konecranes Plc. All rights reserved.
FUNDING FACILITIES
• Committed 5 year Revolving Credit Facility of EUR 200 million until Dec 2015, currently undrawn
• Bilateral bullet Term Loan of EUR 100 million until Oct 2016• Senior unsecured domestic bond of EUR 75 million until June 2014• Commercial Paper program of EUR 480 million, EUR 217 million in
use at end-Q2/12• Various uncommitted credit lines• Pension loan of EUR 17 million until Sep 2016• Cash and cash equivalents of EUR 168 million at end-Q2/12
10.9.2012 Finance/ Teo Ottola16
© 2012 Konecranes. All rights reserved.
SUMMARY
• Growth track record• Focus on improving fixed cost
absorption• Some structural reasons
behind the NWC increase, but actions on-going to improve the current situation
• Balanced funding facilities
10.9.2012 Finance/ Teo Ottola17
© 2012 Konecranes. All rights reserved.
NOT JUST LIFTINGTHINGS, BUT ENTIRE BUSINESSES
10.9.2012 Finance/ Teo Ottola18