Cash flow increased Excellent year in Kalmar and Hiab - PowerPoint PPT Presentation

6 February 2020 Cash flow increased • Excellent year in Kalmar and Hiab significantly • Good development in service business • Strong order book Cargotec’s financial statements review 2019 Mika Vehviläinen, CEO • Mikko Puolakka, CFO Cargotec’s financial statements review 2019 6/2/2020 1

Contents 1. Group level development 2. Strategic options in Navis business 3. Business areas 4. Financials, dividend and outlook

Highlights of 2019 – Comparable operating profit and sales increased 8.0% 7.3% • Orders received decreased by 1% 7.2% 7.1% • Kalmar -7% 6.2% 259 264 250 242 • Hiab +4% 231 • MacGregor +9% 4.4% • Sales increased by 11% 149 • +10% in comparable FX • Comparable operating profit increased by 9% Cargotec’s January–September 2019 interim report • Kalmar’s increased by 13%, Hiab’s by 27% 2014 2015 2016 2017 2018 2019 Mika Vehviläinen, CEO • Mikko Puolakka, CFO • MacGregor’s comparable operating Comparable operating profit EUR million Comparable operating profit margin profit was MEUR -28 EUR Cargotec’s financial statements review 2019 6/2/2020 3

Market Global container throughput (MTEU) – Key driver for Kalmar Source: Drewry environment 2019 800 802 784 600 +2.3% 400 200 0 2018 2019 Growth in number of containers handled at ports continued Construction output – Key driver for Hiab Source: Oxford Economics  Customers are starting automation United States Europe projects mainly with phased 800 800 investments 752 754 746 726 600 600 +0.3% +2.8% 400 400 Construction activity increased in 200 200 Europe and grew slightly in the US 0 0 2018 2019 2018 2019 In both merchant and offshore Long term contracting – Key driver for MacGregor Source: Clarkson Research (number of ships and offshore units) Merchant ships > 2,000 dwt/gt (excl. ofs & misc) Offshore mobile units sector, orders and activity Indicative historical average 2,000 500 remained on a low level Historical average 400 1,500 Historical average 300 1,000 200 936 91 -9% -34% 851 60 500 100 0 0 2018 2019 2018 2019 Cargotec’s financial statements review 2019 6/2/2020 4

Orders received remained at a high level in 2019 MEUR -1% (y/y) 1,200 4,000 3,756 3,714 1,022 991 3,500 981 580 962 630 1,000 921 165 872 863 131 858 3,000 184 -19 % +5% 193 141 116 (y/y) 800 124 (y/y) 156 1,259 2,500 1,310 301 341 294 357 322 600 2,000 307 340 -10% 307 (y/y) 1,500 400 1,000 1,919 550 1,776 516 486 -1% 450 446 432 417 200 396 -19 % (y/y) 500 (y/y) 0 0 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 2018 2019 Kalmar Hiab MacGregor Kalmar Hiab MacGregor Cargotec’s financial statements review 2019 6/2/2020 5

Order book increased compared to 2018, driven by MacGregor and Kalmar Order book Order book by reporting MEUR segment, Q4 2019 2,400 2,251 2,145 2,089 2,200 2,072 1,995 2,000 712 536 30% -11 % 519 1,800 633 530 (y/y) 1,600 1,400 483 453 458 406 453 1,200 1,000 800 600 1,127 1,101 50% 1,083 1,049 1,012 400 200 20% 0 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Kalmar Hiab MacGregor Kalmar Hiab MacGregor Cargotec’s financial statements review 2019 6/2/2020 6

Sales increased in all business areas, comparable operating profit burdened by MacGregor’s weak result Sales Comparable operating profit MEUR MEUR 1,250 74 80 70 68 1,015 64 70 1,000 58 57 910 911 901 60 176 856 127 149 170 50 139 750 40 368 318 358 307 30 316 500 20 10 250 471 444 0 427 424 401 -10 0 -20 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 x Kalmar Hiab MacGregor Kalmar Hiab MacGregor Cargotec total EBIT* *) Including Corporate admin and support Cargotec’s financial statements review 2019 6/2/2020 7

Good development in service and software sales Service and software* sales 2019 service sales +8% MEUR  Kalmar +3% Services Software  Hiab +11% 350 1,500  MacGregor +15% 1,230 46 300  Total service sales 7% in 44 1,126 1,127 47 41 1,200 comparable FX 38 168 250 147 Software sales +15% 900 200 Service and software sales 150 285 600 269 259 constituted 33% of total sales 257 249 1,062 980 100 in 2019 300 50 0 0 2018 2019 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 *Software sales defined as strategic business unit Navis and automation software Cargotec’s financial statements review 2019 6/2/2020 8

Cargotec to evaluate strategic options for Navis business  Cargotec will review alternative development paths including new ownership structures and a potential sale of Navis business  The aim of the strategic evaluation is to secure best possible growth and value creation for the next development phase for Navis  Cargotec’s investment since 2011 has enabled Navis to become the market leader in terminal operating systems (TOS), and more than doubled revenue to EUR 115 million in 2019  Cargotec’s other software business will not be part of the evaluation Cargotec’s financial statements review 2019

Committed to become the leader in intelligent cargo handling – evaluating future options for value creation 3 Evaluating ecosystem play Increased focus on intelligent solutions and system level optimisation. Availability and performance-based solutions and services 2 Advanced robotics Continuous development of 1 equipment, spare parts and maintenance services Cargotec’s financial statements review 2019

Business areas Cargotec’s financial statements review 2019

Kalmar Q4 – Strong order book, profitability declined MEUR Q4/19 Q4/18 Change Orders received remained stable Orders 446 450 -1%  Growth in automation and projects, received decline in mobile equipment Order book 1,049 1,012 +4% Sales increased by 6% Sales 471 444 +6% TO BE UPDATED  Services growth +6% in Comparable 44 51 -14% comparable FX operating profit Comparable operating profit Comparable 9.4% 11.5% -214bps decreased due to a less profitable operating sales mix profit margin Cargotec’s financial statements review 2019

Hiab Q4 – Strong improvement in operating profit MEUR Q4/19 Q4/18 Change Order backlog lower as supply Orders 322 357 -10% chain normalised received  10% decline in orders received, Order book 406 453 -10% coming mainly from the US and UK Sales 368 318 +16% Sales increased by 16% Comparable 52 35 +49% operating  Across all product lines profit Comparable operating profit Comparable 14.1% 11.0% +310bps increased due to growth in sales operating profit margin Cargotec’s financial statements review 2019

MacGregor Q4 – Loss making in Q4, service sales increased Orders received increased by 5% MEUR Q4/19 Q4/18 Change  Orders received excl. TTS -8% Orders 193 184 +5%  Decline in merchant, increase in received offshore (+35%) and service orders Order book 633 530 +20% (+36%) Sales 176 149 +18% Sales increased by 18% Comparable -13 -7 -84%  Sales excl. TTS -3% operating profit Service sales +26%  Comparable -7.1% -4.6% -255bps Comparable operating profit operating declined profit margin  Cost overruns in certain offshore projects, low capacity utilisation, lower sales margins Productivity improvements ongoing  Cargotec’s financial statements review 2019

Planned MacGregor cost savings The potential cost savings in 2020 are estimated to be around EUR 15 million Potential cost savings from the TTS integration  EUR ~12 million in 2020  EUR ~10 million in 2021  EUR ~5 million in 2022–2024 TTS integration cost synergy components  Roles/Positions  Facilities  Supply chain

Financials, dividend and outlook Cargotec’s financial statements review 2019

Key figures – EPS burdened by restructuring costs 10-12/19 10-12/18 Change 2019 2018 Change 962 991 -3% 3,714 3,756 -1% Orders received, MEUR 2,089 1,995 +5% 2,089 1,995 +5% Order book, MEUR 1,015 910 +12% 3,683 3,304 +11% Sales, MEUR 74 70 +7% 264 242 +9% Comparable operating profit, MEUR 7.3% 7.7% Comparable operating profit, % 7.2% 7.3% -56 Items affecting comparability, MEUR -9 < -100% -84 -52 -62% 18 61 Operating profit, MEUR -70% 180 190 -5% 1.8% 6.7% Operating profit, % 4.9% 5.8% Net income, MEUR -0 34 <- 100% 89 108 -17% Earnings per share, EUR -0.00 0.53 <- 100% 1.39 1.66 -16% Earnings per share, EUR* 0.51 0.62 -16% 2.19 2.33 -6% Cargotec’s financial statements review 2019 6/2/2020 17 *) Excluding items affecting comparability and adjusted with related tax effect

Cash flow improved significantly Cash flow from operations before financing items and taxes MEUR 400 373 361 350 315 300 253 250 208 204 200 150 126 86 100 81 41 50 31 27 17 0 -4 -50 2014 2015 2016 2017 2018 2019 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Cargotec’s financial statements review 2019 6/2/2020 18