Hiab helps drive double digit rises at Cargotec
By Alex Dahm21 July 2022
Finnish materials handling equipment manufacturing group Cargotec posted some strong figures for the first half of 2022.
Group sales increased by 14 percent to €1,810 million from €1,583 million in 2021. Hydraulic loader crane manufacturing division Hiab posted increased sales, as did the Kalmar port cranes business. Service sales were also up, by 12 % to €586 million from €523 million a year earlier. Sales decreased in the MacGregor offshore and ship crane and equipment division.
Operating profit for the group was €85 million, up from €69 million in the first half of 2021. It was 4.7 % of sales as against 4.4 % a year earlier. This figure includes items that affect comparability with earlier periods worth €66 million, the company said. Some related to the cancelled merger with Konecranes and some to the impact on the business of the war in Ukraine.
CEO forecasts higher operating profit
Mika Vehviläinen, Cargotec CEO, commented on the most recent period’s results, “The second quarter was successful for Cargotec. Our personnel did an excellent job in a challenging operating environment, making our good performance possible. Our orders received, order book and comparable operating profit reached all-time records. Also, our sales grew significantly compared to the comparison period.”
Vehviläinen said margins remained good despite increased costs. “The success was particularly prominent at Hiab, which reached record high sales and comparable operating profit in the second quarter.”
Following abandonment of the proposed Cargotec and Konecranes merger Cargotec announced it was considering disposal of its Kalmar heavy port crane business. Agreement has been reached for Kalmar to transfer its heavy port cranes-related intellectual property and assets to Rainbow Industries Co. Ltd. (RIC) in China, a company it has already had connections with for years.
The MacGregor division, suffering low sales but still profitable and showing an increase in orders, remains under evaluation for a possible sale.
Growth in the forecast
Looking ahead Cargotec said its outlook for 2022 is unchanged. Supply chain challenges and market uncertainty are expected to continue but the company’s comparable operating profit for 2022 is forecast to improve over the €232 million of 2021.
“Our starting position for the latter half of the year is good. Even though market forecasts have been cut during the [second] quarter, our markets are still estimated to grow. Despite the surrounding uncertainty, we enter the second half of the year in a good position with a strong balance sheet and a record order backlog. The supply chain challenges are expected to continue also during the second half of the year. In Cargotec’s business the third quarter is typically less active than the second quarter. We also anticipate the third quarter sales mix to be slightly weaker than in the second quarter.”