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KONE 2003 Audited Financial Statements

Stock Exchange Release Published 30/01/2004

Profitability and Order Intake Targets Achieved and Restructuring Completed

  • The restructuring of KONE Materials Handling was completed through the divestment of Forest Machines, non-core holdings, and, in January 2004, the Tractors business. The new Kone Cargotec consists of Kalmar (container handling) and Hiab (load handling).
  • The value of orders received rose to MEUR 4,558 (2002: 3,261). KONE Elevators & Escalators accounted for MEUR 2,021 (2,129), which represents two percent growth at comparable exchange rates. Order intake in Kone Cargotec and other materials handling operations was MEUR 2,537. Kone Cargotec accounted for MEUR 1,482, reflecting growth of 18 percent at comparable exchange rates.
  • Net sales totaled MEUR 5,344 (4,342). KONE Elevators & Escalators’ sales amounted to MEUR 2,814 (2,970), which represents two percent growth at comparable exchange rates. Sales in Kone Cargotec and other materials handling operations totaled MEUR 2,530. Kone Cargotec accounted for MEUR 1,335 reflecting growth of six percent at comparable exchange rates.
  • Operating income before goodwill amortization (EBITA) was MEUR 418.5 (340,2), or 7.8 (7.8) percent of net sales. In Elevators & Escalators, EBITA was MEUR 298.6 (287.0), or 10.6 (9.7) percent of net sales. The EBITA in Kone Cargotec and other materials handling operations was MEUR 133.4. Kone Cargotec accounted for MEUR 74.9 or 5.6 (3.4) percent of net sales.
  • Cash flow from operating activities before financial items and taxes was MEUR 498.7 (615.6).
  • Interest-bearing net debt decreased to MEUR 661.9 (end of 2002: 1,251.5).
  • Net income rose 38 percent to MEUR 216.9 (157.1).
  • Earnings per share rose to EUR 3.10 from EUR 2.54. The EUR 21.6 million capital gain from the sale of Forest Machines is included in extraordinary items and is not included earnings per share.
  • The board of directors proposes that the dividend be raised to EUR 2.00 from EUR 1.50 per class B share


The figures for Materials Handling were consolidated into KONE’s figures as of 1 July, 2002, and the comparison figures for 2002 are, therefore, consolidated for the period July-December

KONE Chairman of the Board Antti Herlin in conjunction with the 2003 Financial Statements:

“Among the main achievements of 2003, we can count the success of KONE Elevators & Escalators in the continuing challenging market environment and the improved profitability in Kalmar and Hiab. The EBITA margin targets of 10 percent in the elevator and escalator business and five percent in Kone Cargotec were both exceeded.
“Three years ago we introduced an incentive system linked to our profit development for approximately 250 key employees. The goal of this option plan is motivate key employees to commit themselves to attaining KONE’s global growth and profitability goals.
“We achieved the cumulative net income target of EUR 470 million in 2001-2003, which means that the program will be implemented to the maximum amount. We can all be proud of our achievements.
“We completed the restructuring of the materials handling operations during the year. Kone Cargotec was born, consisting of the globally leading businesses Kalmar and Hiab.
“We have rapidly reduced debt through divestments. The sale of the Tractors business in the beginning of January 2004 reduced gearing almost to zero. Our leaner balance sheet gives us good opportunities to develop both the elevators and escalators business and Kone Cargotec.”

Entire financial statement 2003

Corrected statement of cash flows

Sender:
KONE Corporation
Tapio Hakakari
Secretary to the Board of Directors
Aimo Rajahalme
Executive Vice President, Finance and Information Services
For additional information, please contact:
Aimo Rajahalme, Executive Vice President, Finance and Information Services,
tel. +358 (0)204 75 4484
KONE is a global service and engineering company that specializes in moving people and goods. It comprises two divisions: KONE Elevators & Escalators and Kone Cargotec. KONE Elevators & Escalators sells, manufactures, installs, maintains and modernizes elevators and escalators, and services automatic building doors. Kone Cargotec supplies products and services to facilitate moving and loading cargo. KONE's B shares are listed on the Helsinki Exchanges.
www.konecorp.com