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KONE Corporation’s Interim Report for January-March 2010

Stock Exchange Release Published 20/04/2010

KONE’s Q1: The year started strongly

January-March 2010

  • In January–March 2010, orders received totaled EUR 894.7 (1–3/2009: 898.5) million. Orders received declined by 0.4% at historical exchange rates and by 0.9% at comparable exchange rates. The order book stood at EUR 3,638 (Dec 31, 2009: 3,309) million at the end of March 2010.
  • Net sales declined by 1.8% to EUR 1,003 (1,021) million. At comparable exchange rates it declined by 2.5%.
  • Operating income was EUR 108.6 (91.2) million or 10.8% (8.9%) of net sales.
  • Cash flow from operations was very strong and reached EUR 217.6 (170.3) million.
  • KONE upgrades its outlook for 2010. KONE’s net sales is estimated to decline by 0–5% compared to 2009. The operating income (EBIT) is expected to be in the range of EUR 580–620 million. KONE previously estimated its net sales to decline approximately by 5% at comparable exchange rates. The previous operating income (EBIT) outlook was EUR 560–610 million.
Key Figures
1-3/20101-3/20091-12/2009
Orders receivedMEUR894.7898.53,432.4
Order bookMEUR3,638.53,753.13,309.1
SalesMEUR1,003.01,021.04,743.7
Operating incomeMEUR108.691.2600.3 x)
Operating income%10.88.912.7 x)
Cash flow from operations
(before financing items and taxes)

MEUR
217.6
170.3

825.1
Net incomeMEUR81.678.7466.4
Total comprehensive incomeMEUR110.880.2449.5
Basic earnings per shareEUR0.320.311.84
Interest-bearing net debtMEUR-360.0-40.3-504.7
Total equity/total assets%41.234.947.0
Gearing%-32.1-4.2-37.7

x) Excluding a MEUR 33.6 one-time restructuring cost related to the fixed costs adjustment program, which was booked in the second quarter in 2009.

KONE President & CEO, Matti Alahuhta, in conjunction the review:

“I am very pleased with our performance in the first quarter. Orders received was approximately at the same level as a year ago, even though new equipment markets continued to be weak in Europe and the Americas. Operating income grew by 19.1% and both operating income and cash flow were at record high first quarter levels.

This means that we have so far managed to improve our performance all the time in the weak environment. Our approach of being market opportunity oriented, of focusing in areas which have profit improvement potential and of developing people leadership has worked well. Our personnel has done a great job. I want to thank them for their efforts.”

KONE Q1 2010 Interim Report.pdf

Analyst and media meeting and conference call

A meeting for the press, conducted in Finnish, will be held on Tuesday, April 20, 2010 at 2:15 p.m. Eastern European Time.

A telephone conference and a meeting for analysts, conducted in English, will begin at 3:45 p.m. Eastern European Time. The meeting can also be followed as a webcast on www.kone.com.

Both meetings will take place in the KONE Building, located at Keilasatama 3, Espoo, Finland.

Telephone conference numbers:

US callers: +1 866 458 4087
Non-US callers: +44 203 043 2436
Participant code: KONE

An on demand version of the telephone conference will be available on www.kone.com later the same day.

About KONE

KONE is one of the global leaders in the elevator and escalator industry. The company has been committed to understanding the needs of its customers for the past century, providing industry-leading elevators, escalators and automatic building doors as well as innovative solutions for modernization and maintenance. The company's objective is to offer the best people flow experience by developing and delivering solutions that enable people to move smoothly, safely, comfortably and without waiting in buildings in an increasingly urbanizing environment. In 2009, KONE had annual net sales of EUR 4.7 billion and approximately 34,000 employees. KONE class B shares are listed on the NASDAQ OMX Helsinki Ltd in Finland. Founded in 1910, KONE celebrates its centennial anniversary in 2010.

www.kone.com

For further information please contact:
Henrik Ehrnrooth, CFO, tel. +358 (0) 204 75 4260

Sender:

KONE Corporation

Henrik Ehrnrooth
CFO

Anne Korkiakoski
Executive Vice President,
Marketing and Communications