28.04.2021

Strong order intake for Hiab and Kalmar

Cargotec - owner of Hiab loader cranes, Kalmar marine handling equipment and MacGregor, has released its first quarter result which show a strong first quarter order intake.

Beginning with Hiab, total revenues for the first quarter were €287 million, five percent below the same quarter last year. However, order intake during the three months was 44 percent better than last year at €425 million, taking the order book at the end of March to €642 million – up 28 percent. Operating profits were 17 percent higher at €33.1 million.

Moving on to Kalmar, the company saw sales drop 20 percent to €324 million, although it too had a very strong order intake in the period - rising 58 percent to €529 million leaving the order book 25 percent higher at just over €1 billion. Operating profits declined 25 percent to €18 million.

Cargotec as a whole posted revenues of €730 million for the quarter, a fall of 15 percent, while pre-tax profits declined seven percent to $18.3 million.

Cargotec chief executive Mika Vehviläinen said: “The gradual market recovery from the difficult pandemic situation began in the second half of 2020 and continued in the first quarter of 2021. Our orders received increased by 43 percent compared to the comparison period as all business areas increased their orders. Strong demand continued at Kalmar and Hiab, and Hiab’s orders received was once again its best ever. Interest in Kalmar's automation solutions also increased. MacGregor’s orders received increased by seven percent, driven by a pick-up merchant ship market. Our order book increased by 22 percent compared to the end of 2020, which positions us well for 2021 onwards. Services orders received increased by 11 percent from the comparison period.”

"Our sales decreased by 15 percent from the comparison period, reflecting the expected low order intake during last year’s second quarter and the beginning of the third quarter. The availability of product components did not have a material impact on our operations but, if prolonged, the global shortage of components could pose challenges. We monitor closely our supply chain performance and are actively cooperating with our suppliers. Service and software sales constituted 40 percent of our total sales. Despite the difficult pandemic situation and restrictions caused by it, services sales only decreased by two percent.”

“Despite the decline in sales, our comparable operating profit increased by 14 percent. Comparable operating profit increased in Hiab and MacGregor while Kalmar's profitability weakened.”

“In March, we announced the agreement to sell Navis software business to the US investment firm Accel-KKR for an enterprise value of €380 million. The final purchase price will be determined at closing. The agreement delivers a great home for Navis and secures the best possible growth and value creation for its next development phase. Closing is expected by the end of Q3 2021.”

“On 1 October 2020, we announced the plan to combine Cargotec and Konecranes through a merger. Extraordinary meetings held on 18 December 2020 by each of the companies resolved the resolution to approve the merger. The implementation of the merger is subject to obtaining the necessary approvals from the competition authorities.”

Vertikal Comment

A strong start to the year for Hiab, in terms of order intake, which should allow the company to catch up by mid year, although in terms of profitability it is already nicely ahead of the game. Kalmar also looks as though the rest of the year will be a great deal better. Meanwhile the proposed merger with Konecranes moves on, and we should hear more when looking at the half year numbers.