Main production sitesSales and Service locations
Key figures in 2008:• Sales: MEUR 2,103• Employees: ~9,900• EBIT: MEUR 247• EBIT-%: 11.8 %• ROCE: 56.3%
Konecranes at a glance
#1 in the world in• Crane Maintenance Services• Standard Lifting Equipment• Industrial Process Cranes• #3-4 in lifting equipment for Ports
Production in 12 countries on three continents
Service depots and sales offices in 43 countries
© 2009 Konecranes Plc. All rights reserved. 2
31 %
12 %
7 %
50 %
Finnish companies and organizationsFinnish householdsForeign ownersNominee registered
Share details and ownership information
Trading informationListing: NASDAX OMX HelsinkiDate of listing: March 27, 1996Segment: Large CapSector: IndustrialsTrading code: KCR1VL12M (September 2009) turnover velocity: 202%
Largest shareholders on September 30, 2009 Nr of shares
% of all shares
1 Ilmarinen Mutual Pension Insurance Company
2,614,689 4.23%
2 Gustavson Stig, Chairman of the Board of Konecranes
2,036,772 3.29%
3 Varma Mutual Pension Insurance Company 2,005,275 3.24%
4 Nordstjernan Ab 1,380,024 2.23%
5 Nordea Nordenfonden 1,345,270 2.18%
6 Hartwall Capital Oy Ab 799,482 1.29%
7 The Local Government Pensions Institution 759,413 1.23%
8 The State Pension Fund 600,000 0.97%
9 Mutual Life Insurance Company Suomi 550,000 0.89%
10 Folkhälsan Samfundet i Svenska 535,600 0.87%
Konecranes’ treasury shares 2,542,600 4.11%
Nominee registered shares 30,760,646 49.73%
Total number of shares 61,849,720 100%
Market cap >EUR 1 bn
© 2009 Konecranes Plc. All rights reserved. 4
Productivity enhancing • lifting equipment to various industries as
well as to ports and terminals• maintenance services to diverse industrial
customers and ports through the global sales network.
Product offering based on• a unique service business concept • world’s most extensive crane service
network• industry-leading technology• global modular product platforms• extensive own and third-party distribution
coverage
Business proposition
© 2009 Konecranes Plc. All rights reserved.6
0%
2%
4%
6%
8%
10%
12%
14%
0
250
500
750
1000
1250
1500
1750
2000
2250
© 2009 Konecranes Plc. All rights reserved.
Solid profitable growth during the past few years
MEUR
7
Sales by business area 1998 - 2008
0
500
1000
1500
2000
2500
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
SERVICE STANDARD LIFTING HEAVY LIFTINGMEUR
29%
37%
34%
© 2009 Konecranes Plc. All rights reserved. 8
Sales by region MEUR 1998 - 2008
0
250
500
750
1000
1250
1500
1750
2000
2250
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
EMEA AME APAC
15%
28%
57%
© 2009 Konecranes Plc. All rights reserved. 9
10,8
13,7
17,2
29,5
46,2*56,3
0 10 20 30 40 50 60
2003
2004
2005
2006
2007
2008
Recent development in ROCE
• Vision to increase the current 17-percent market share and achieve a 30-percent global market share
Focus on profitable growth
• Optimal long-term gearing ratio in the range of 50 – 80% - may be under/above in the short term
• Group EBIT-margin 10% over the cycle
* The 2007 ROCE including capital gain was 50.4 %
© 2009 Konecranes Plc. All rights reserved. 10
Payout history
0.220.33
0.43
1.17
2.17*
2.83
0.50
0.26 0.280.45
0.800.90
00,20,40,60,8
11,21,41,61,8
22,22,42,62,8
3
2003 2004 2005 2006 2007 2008
EPS DIVIDEND
* 2007 EPS excluding capital gain: EUR 1.95
© 2009 Konecranes Plc. All rights reserved. 11
Strategic cornerstones
GROUP STRATEGY
BUSINESS AREAServiceStandard Lifting Heavy Lifting
REGIONEMEAAMEAPAC
SEGMENTSAutomotive General manufacturingIntermodal & RailMiningOil & GasPaperPortsPowerSteel
• Extensive product offering• Broad customer base• Global reach
• Footprint expansion• New products• Acquisitions
© 2009 Konecranes Plc. All rights reserved. 13
Diverse customer base (R12M at end September 2009)
© 2009 Konecranes Plc. All rights reserved. 14
Pulp and Paper4%
Power plants5%
Steel & other warehousing
3%
General manufacturing
29%
Refuse handling1%
Automotive2%
Primary metals9%
Harbours16%
Shipyards4%
Resellers10%
Transport & shipping industry
2%
OEM Crane builders4%
Petro-chemical3%
Construction2%
Mining2%
Aviation, aerospace industry
<1%
Others4%
Interlinked business model
STANDARD LIFTING
• Prominent position as the world’s largest supplier of industrial cranes and wire rope hoistsEfficient modularized product platformScale benefits both in production and sales via global supply chain and distribution channels
HEAVY LIFTING
• Prominent position as one of the world’s largest suppliers of heavy-duty cranes and container handling equipmentHigh-level expertise on customers ‘production processesFlexibility through cost baseGlobal supply chain
The business model offers a substantial potential for cross selling between new equipment and services
SERVICE
• A unique business conceptOne step ahead of a traditional after-sales only serviceMaintenance to all, including competitors’ crane makesMore value-added for customers through performance-based agreements
© 2009 Konecranes Plc. All rights reserved. 15
Business strategies are implemented through three regions
EMEAEurope, Middle East,
Africa
Mature markets
• High technology equipment for efficiency enhancing material handling• Higher level service contractsFast growing markets
• Capacity upgrading and expansions• Opportunity for service contracts
AMENorth and South
Americas
North America
• Utilizing the willingness for maintenance outsourcing and higher level service contracts
• High technology equipment for efficiency enhancing material handlingSouthern America
• Fast growing market with lots of opportunities both in new equipment and services
APACNortheast Asia,
South Asia-Pacific
A mix of mature markets in Australia and Southeast Asia and the fast growing economies of China and India
•Exploiting the market leader position for service in Australia•Exploiting the market leader position for high-end equipment market in China•Increasing market share and introducing the concept for outsourced maintenance
© 2009 Konecranes Plc. All rights reserved. 16
Two-folded sales and distribution strategy
GROUP STRATEGY
BUSINESS AREAServiceStandard Lifting Heavy Lifting
• Sales directly to end users under the Konecranes brand
• Sales to crane makers and resellers under the freestanding power brands
© 2009 Konecranes Plc. All rights reserved. 17
Main production sitesSales and Service locations
Production and supplying partners on three continents
USA• wire rope hoists• chain hoists• gear reducers• winches• control systems• crane factories
Finland• wire rope hoists &
winches• gear redurcers• control systems• automation/software
Sweden
• lift trucks
UK• crane factories
France• chain hoists
Germany• wire rope hoists• chain hoists• crane factory
Ukraine
• mechanical crane components and heavy steel structures
China
• RTG-crane assemblies
• wire rope hoists
• chain hoists
• winches
• control systems
• lift trucks
© 2009 Konecranes Plc. All rights reserved. 18
Heavy Lifting Demag Cranes AG, GermanyProcess cranes ZPMC, China~ 2 BEUR ~ 14% Kalmar (part of Cargotec Corporation), FinlandCont. handling & other port equip. Fantuzzi Group, Italy (part of Terex, USA)~ 5 BEUR ~ 8% Liebherr, Germany (private company)
Various smaller private companies
Market size and market share
Market Size KC market share* Other companies in the sector
*Konecranes estimates
Standard Lifting Demag Cranes AG, Germany> 4 BEUR ~ 20% Columbus McKinnon Corporation, U.S.A.
Kito, JapanAbus Kransysteme GmbH, Germany (private company)Various smaller private companies
Service Customers’ in-house maintenanceOpen: > 3 BEUR > 20% Demag Cranes AG, GermanyTotal: > 10 BEUR > 7% Various smaller private companies
© 2009 Konecranes Plc. All rights reserved. 20
Rising requirement for increasing productivity, byoutsourcing and High-class equipment
Increasing environmentalconsciousness through investments in ecological solutions Increasing need for energy
investments
Increasing global tradeWestern players transferring production to lower cost areas
Economic growth driven industrial capacity build up
Need for new technology/Software applications
Global megatrends
© 2009 Konecranes Plc. All rights reserved. 21
Every new nuclear reactor offers a large potential for cranes and services
© 2009 Konecranes Plc. All rights reserved. 22
•Actively seeking profitable growth– Aggressive organic growth
– Acquisitions
•Being alert to global megatrends
•Responding innovatively to customer needs
• R&D
• Value-adding service concepts
•Enhancing efficiency of own business model
Main drivers for Konecranes’ success
© 2009 Konecranes Plc. All rights reserved. 24
Management agenda
• Top-line defense– footprint expansion, new products
and services, bolt-on acquisitions• Actions to adjust capacity • Rationalization
– manufacturing, purchases, operative and legal structures
• Balance sheet management– low gearing– NWC in focus
• Risk management– order book quality – monitoring
postponements and cancellation risks
– counterparties – diverse customer and supplier base
© 2009 Konecranes Plc. All rights reserved. 25
Flexible material and subcontracting costs account for some 60% of total operating expenses in 2008
Depreciation/ amortisation
1%
Total personnel expenses25%
Other operating expenses14%
Subcontracting13 %
Material and supplies47%
Flexibility directly linked to volume development
Actions case by case and unit by unit
Flexibility somewhat more restricted
Total operating expenses in 2008 EUR 1.9 bn
© 2009 Konecranes Plc. All rights reserved. 26
Services is a genuine growth market benefiting from the outsourcing trend
© 2009 Konecranes Plc. All rights reserved.
• Outsourcing driven by productivity, opex, safety & competence.
• Customers increasingly prefer globally scalable suppliers.
27 %
66% Konecranes
Outsourced Market
“In-house”Maintenance
Case Study of North American Market 2007 (> 3.5 BUSD)
7%
27%
28
• Services on maintenance, modernisations and spare parts are offered for all crane makes
– 75% of service revenue is generated from non-Konecranes equipment
– Service concept has been developed for over 4 decades
• Service offering is developed continuously
– more value-added to the customer
– performance-based agreements
– widening service offering based on in-house competences
25 % 30 %
10 %35 %
Initial Purchase
Maintenance
Spare Parts
Modernisation
Real Case of Paper Process Crane over it’s 30-Year Life
Unique service concept and world’s largest crane serviceorganisation
© 2009 Konecranes Plc. All rights reserved. 29
Five Levels of Service
1 CONTACT- One-off repairs, spare parts, inspections, modernizations, emergency on-call
- Contract on periodic and scheduled inspections- Maintenance action recommendations
- Preventive maintenance contract
-Full scope maintenance outsourcing- Tied to customers KPI’s
- Fully outsourced material handling
2 CONDITION
3 CARE
4 COMMITMENT
5 COMPLETE
Full scope contract
One-off transactions
Full scope outsourcing
© 2009 Konecranes Plc. All rights reserved. 30
Light lifting and chain hoists
• Workstation Cranes
up to 2000kg
• Jib Cranes up to 5000kg
• XN Chain Hoists 60 – 7500kg
• Monorail Systems 125 – 2000kg
Jib Crane Chain Hoist Monorail systems
© 2009 Konecranes Plc. All rights reserved. 32
Industrial cranes
• Single Girder Cranes up to 12.5 tons
• Double Girder Cranes up to 80 tons
• Underslung Cranes up to 12.5 tons
• Explosion Proof Cranes up to 80 tons
Electric Overhead Traveling Crane
© 2009 Konecranes Plc. All rights reserved. 33
Customer industries
• General Manufacturing• Automotive• Cement and Concrete• Entertainment• Glass• Mining• Petrochemical• Plastic• Power Plants• Pulp and Paper• Steel• Stone and Marble• Water Treatment Plants
© 2009 Konecranes Plc. All rights reserved. 34
Heavy lifting trolleys for process and port cranes
LV Tailored Winch 5 - 1000 ton
SM Standard Winch 5 - 500 ton
© 2009 Konecranes Plc. All rights reserved. 36
Steel industry
• Solutions in EOT Cranes and Lift Trucks for All Process Phases
• From the Scrapyard through the melt-shop to the storage area
• Slabs, blooms, billets, format plates, coils, tubes and wires
© 2009 Konecranes Plc. All rights reserved. 37
Power generation
• Supports the power industry with new crane installations
• Crane modernizations and replacement investments
• Positioning of extremely heavy and valuable loads
• Solutions for both the construction and the maintenance of a power plant
© 2009 Konecranes Plc. All rights reserved. 38
Paper industry
• Applications in the pulp and paper production
• Process duty and service cranes for all phases
• Clamp & Bale trucks for Loading and Unloading of trucks, rail cars or ships and handling of rolls in storage
• Automatic paper roll storage systems
© 2009 Konecranes Plc. All rights reserved. 39
Container handlingPorts, Railroad, River and Inland Terminals
• Rubber Tired Gantry Crane
• Rail Mounted Gantry Crane
• Ship-to-Shore Gantry Crane
• Reachstacker
• Masted Lift Truck
• Empty Container Lift Truck
• Laden Container Lift Truck
• Straddle Carrier
© 2009 Konecranes Plc. All rights reserved. 40
Bulk handling & shipyards
• Bulk Handling Cranes
• Shipyard Cranes
• Shipboard Cranes
• Fork Lift Trucks
Slewing Ship-yard Crane
Munckloader Off Shore CraneHeavy Cargo Gantry Crane
Goliath GantryCrane
Fork Lift Truck
Grab Unloader
© 2009 Konecranes Plc. All rights reserved. 41
Contact information
• Pekka Lundmark, President and CEOtel. +358 (0)20 427 2000 [email protected]
• Teo Ottola, Chief Financial Officertel.+358 (0)20 427 2040 [email protected]
• Mikael Wegmüller, Director, Marketing and Communicationstel: +358 (0)20 427 [email protected]
www.konecranes.com
© 2009 Konecranes Plc. All rights reserved. 42