KONE Corporation’s Interim Report for January-June 2009

Stock Exchange Release Published 21/07/2009

KONE’s Q2: Continued good performance



- In April-June 2009, orders received totaled EUR 953.9 (4–6/2008: 1,092) million. Orders received declined by 12.7%, or 13.6% at comparable exchange rates.
- Net sales increased by 2.3% to EUR 1,169 (1,142) million. At comparable exchange rates, the growth was 1.5%.
- Operating income excluding one-time costs was EUR 146.3 (136.7) million or 12.5% (12.0%) of net sales. The operating income, including the one-time cost of EUR 33.6 million related to the fixed cost adjustment program, was EUR 112.7 million.
- The plans for the fixed cost adjustment program have now been defined. The annual fixed cost reduction is expected to be at least EUR 40 million starting in 2010 and the total one-time cost relating to this program is EUR 33.6 million. The program is implemented in response to the weak new equipment market in order to be better prepared for 2010.
- KONE further specifies its full-year outlook for 2009. In net sales, the objective is to grow 2–5% as compared to net sales in 2008. In operating income (EBIT), the objective is EUR 570–595 million excluding the one-time cost of EUR 33.6 million.


- In January-June 2009, orders received totaled EUR 1,852 (1–6/2008: 2,210) million. Orders received declined by 16.2%, or 17.1% at comparable exchange rates. At the end of June 2009, the order book was EUR 3,754 (Dec 31, 2008: 3,577) million.
- Net sales increased by 6.9% to EUR 2,190 (2,047) million. At comparable exchange rates, the growth was 6.4%.
- Operating income excluding one-time costs was EUR 237.5 (223.2) million or 10.8% (10.9%) of net sales. The operating income, including the one-time cost of EUR 33.6 million related to the fixed cost adjustment program, was EUR 203.9 million.

Key Figures
Orders receivedMEUR953.91,092.41,852.42,209.93,947.5
Order bookMEUR3,754.13,838.73,754.13,838.73,576.7
Operating incomeMEUR146.3 (1)136.7237.5 (1)223.2558.4
Operating income%12.5 (1)12.010.8 (1)10.912.1
Cash flow from operations
(before financing items and taxes)
Net incomeMEUR86.598.8165.2162.7418.1
Total comprehensive incomeMEUR79.499.9159.6152.6436.7
Basic earnings per shareEUR0.340.390.650.651.66
Interest-bearing net debtMEUR-167.187.0-167.187.0-58.3
Total equity/total assets%38.830.038.830.039.0

1) Excluding a EUR 33.6 million one-time cost related to the fixed cost adjustment program.

Matti Alahuhta, President and CEO, in conjunction with the review:

"I am pleased with our performance in the first quarter. Thanks to continued good development in our service business and to our teams’ good performance also in new equipment project implementation and fixed costs management, we were able to improve our EBIT compared to the first quarter of last year. We also managed to reach in the current difficult environment a higher orders received level than in the second half of last year. However, in the weakening new equipment market, the orders received continued to decline in year-on-year comparison. Therefore, we are targeting to adjust our fixed costs running rate by about EUR 40 million for 2010.

However, maintaining our good spirit and opportunity orientation will be most important in our approach. I am confident that this, together with our continuous development activities, will bring good results for KONE even now in these challenging times.”

Analyst and media conference and conference call

A meeting for the press, conducted in Finnish, will be held on Tuesday, July 21, 2009 at 1:45 p.m. Eastern European Time.

A telephone conference and a meeting for analysts, conducted in English, will begin at 3:00 p.m. Eastern European Time. The telephone conference will also be available 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: +1 334 323 6201
Non-US callers: +44 (0)20 7162 0025
Participant code: Kone

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

Read the report >>

About KONE

KONE’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. KONE provides its customers with industry-leading elevators, escalators and innovative solutions for modernization and maintenance, and is one of the global leaders in its industry. In 2008, KONE had annual net sales of EUR 4.6 billion and over 34,800 employees. KONE class B shares are listed on the NASDAQ OMX Helsinki in Finland.


For further information please contact:

Henrik Ehrnrooth, Executive Vice President, Finance, tel. +358 (0) 204 75 4260


KONE Corporation

Henrik Ehrnrooth
Executive Vice President,

Anne Korkiakoski
Executive Vice President,
Marketing and Communications

2009-07-21 KONE Corporation’s Interim Report for January-June 2009

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