KONE’s Q3: Good progress resulted in strong operating income
- In July–September 2010, orders received totaled EUR 865.2 (7–9/2009: 766.5) million. Orders received increased by 12.9% at historical exchange rates and by 5.7% at comparable exchange rates.
- Net sales increased by 9.6% to EUR 1,236 (1,127) million. At comparable exchange rates the increase was 3.9%.
- Operating income was EUR 184.8 (160.1) million or 15.0% (14.2%) of net sales.
- Cash flow from operations reached EUR 242.8 (255.5) million.
- KONE upgrades its outlook for 2010 due to strong sales growth in particular in the Asia-Pacific region as well as improved overall productivity. KONE’s net sales is estimated to grow 2–6% compared to 2009. The operating income (EBIT) is expected to be in the range of EUR 660–690 million. KONE previously estimated its net sales to be at approximately the same level as in 2009. The previous operating income (EBIT) outlook was EUR 630–660 million.
- In January–September 2010, orders received totaled EUR 2,803 (1–9/2009: 2,619) million. Orders received increased by 7.0% at historical exchange rates and by 2.8% at comparable exchange rates. The order book stood at EUR 3,658 (Dec 31, 2009: 3,309) million at the end of September 2010.
- Net sales increased by 5.5% to EUR 3,498 (3,317) million. At comparable exchange rates it increased by 1.5%.
- Operating income was EUR 469.1 (397.6) million or 13.4% (12.0%) of net sales (1–9/2009 figures exclude a one-time cost of EUR 33.6 million related to the fixed cost adjustment program).
|Operating income||MEUR||184.8||160.1||469.1||397.6 1)||600.3 1)|
|Operating income||%||15.0||14.2||13.4||12.0 1)||12.7 1)|
items and taxes)
1) Excluding a EUR 33.6 million 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 with the review:
“The development of our result in the third quarter was delightful. Our operating income was strong and our orders received developed well, in particular in Asia-Pacific.
No substantial changes were seen in our operating environment during the third quarter. The markets in the Asia-Pacific region continued to develop well, the new equipment market situation in Europe differed from country to country and the North American markets have stabilized at a low level.
Our operating income grew by approximately 15 percent. The strong development was enabled by rapid sales growth in Asia-Pacific, improved quality and productivity as well as lower fixed costs. In addition to these factors, external factors such as more favorable translation exchange rates compared to 2009 and favorable sourcing prices contributed clearly to the development of our operating income. The current trends of these external factors are unfavorable from KONE’s perspective. Should the current trends continue, it will be more challenging to improve the result.
As a result of the continued strong development and favorable external factors during the first three quarters of the year, we have upgraded our full-year outlook for both sales and operating income.”
Analyst and media meeting and conference call
A meeting for the press, conducted in Finnish, will be held on Tuesday, October 19, 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:
Finnish callers: +358 923 101 527
US callers: +1 866 458 40 87
Other callers: +44 203 043 2436
Participant code: KONE
An on-demand version of the webcast will be available on www.kone.com later during the same day.
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.
For further information please contact:
Henrik Ehrnrooth, CFO, tel. +358 (0) 204 75 4260
Executive Vice President,
Marketing and Communications