Recent automation deals highlight our successful investments in automation Kalmar and Navis to deliver world-first intermodal automation solution to Sydney, Australia Greenfield intermodal terminal, Qube’s Moorebank Logistics Park First fully automated intermodal terminal in the world Kalmar OneTerminal contract, including Navis N4 TOS All equipment can be operated electrically on local solar power Order value EUR 80 million, booked in Q2 2018 Fully digitalised and autonomous container handling solution with software and services to Yara Solution enables autonomous, cost efficient and emission-free operations of the Yara Birkeland container ship in Norway 18
Services provide our biggest medium term growth opportunity Equipment & Projects Software Services Market share 20-30% 20-30% 3-5% Market 8B€ 6B€ 0.5- 1B€ size SEB Nordic Seminar 9 January 2019 19
Hiab 20 SEB Nordic Seminar 9 January 2019 20
Construction output driving growth opportunity EMEA construction output AMER construction output y/y change (%) y/y change (%) 5.0 % 130 5.0 % 135 130 125 4.5 % 4.0 % 125 120 4.0 % 120 115 3.0 % 115 110 3.5 % 110 105 2.0 % 3.0 % 105 100 100 1.0 % 95 2.5 % 95 90 2.0 % 90 0.0 % 85 85 1.5 % 80 80 -1.0 % 75 1.0 % 75 70 70 -2.0 % 0.5 % 65 65 -3.0 % 60 0.0 % 60 2010 2012 2014 2016 2018 2020 2022 2010 2012 2014 2016 2018 2020 2022 Index Change % Index Change % Oxford Economics: Industry output forecast 9/2018 SEB Nordic Seminar 9 January 2019 21
Strong market positions in all product lines MARKET SIZE* KEY HIAB POSITION (EUR billion) SEGMENTS & TREND Construction LOADER ~1.3 #1-2 and Logistics CRANES Retail TAIL ~0.5 #1 Logistics LIFTS Waste and ~0.5 #1 DEMOUNTABLES Recycling Construction TRUCK MOUNTED ~0.3 #1 and Logistics FORK LIFTS Timber, Pulp FORESTRY ~0.2 #2 and Paper CRANES *) Cargotec estimate SEB Nordic Seminar 9 January 2019 22
MacGregor 23
We are an active leader in all maritime segments ~3/4 of sales ~1/4 of sales Merchant Marine Marine Resources Naval Logistics Offshore Cargo Flow People Flow & Structures and Operations Energy Container cargo Ferry Research Naval & Military Oil & Gas Bulk cargo Cruise Fishery Supplies Logistics Renewables General cargo Superyachts Aquaculture Naval & Military Liquid cargo Walk-to-work Mining Operations Support RoRo cargo Floating structures Ship-to-ship transfer Lifecycle Services Picture: Statoil SEB Nordic Seminar 9 January 2019 24
Merchant Ships and Offshore contracting activity picking up Long term contracting 2015-2024 Long term contracting 2015-2024 Mobile offshore units Merchant ships > 2,000 gt (excl ofs and misc) No of units No of ships 1,000 2,500 Forecast Forecast 900 800 2,000 Historical avg 700 600 1,500 Historical avg 500 400 1,000 300 200 500 100 0 0 Avg. 07-17 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Avg. 96-17 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Source: Clarksons September 2018 SEB Nordic Seminar 9 January 2019 25
THANK YOU SEB Nordic Seminar 9 January 2019 26
Recent progress 27
We have increased EBIT* margins since 2013 through operational improvements EBIT* 2013 EUR 264 million better EUR 133 million increase EBIT* Q2 2017 LTM** EUR 127 million gross profit in fixed costs EUR 258 million -1.5% 1.0% 1.6% -2.5% 1.9% -0.3% 3.4% 7.5% 4.0% Hiab equipment Service and Kalmar’s large Kalmar MacGregor R&D, Software, Other fixed 2013 Q2 2017 software projects equipment equipment Sales network costs increases LTM EBIT-%* business and Service EBIT-%* investments *Excluding restructuring costs **LTM=Last 12 months (Q3/16-Q2/17) SEB Nordic Seminar 9 January 2019 28
Previously announced cost savings programmes proceeding EUR 50 million annual group-wide savings from 2020 onwards – EUR 18 million cumulative savings at the end of Q3/18 EUR 13 million in 2018 (MacGregor) – EUR 8 million savings in 1-9/18 EUR 13 million in 2018 (Kalmar) – Relocation of assembly operation completed – EUR 5 million savings in 1-9/18 Product redesign and project management improvement continues in 2018 29
Group wide EUR 50 million cost savings programme proceeding faster than expected WHY Expected savings compared to 2016 cost level, MEUR Investments in common systems as enabler 60 EUR ~600 million addressable indirect cost base 50 WHAT Including Reductions in indirect purchasing spend (EUR 30 million), and business services 40 more efficient support functions (EUR 20 million) centre in Sofia HOW 30 Central procurement organization to drive indirect procurement cost and efficiency 20 Establishing support function services in Sofia Automation in Finance, HR, information management and 10 procurement 0 RESULTS 2017 2018 2019 2020 EUR 10 million savings realised in 2017 and additional Indirect procurement Support functions EUR 8 million in 1-9/18 SEB Nordic Seminar 9 January 2019 30
We have established Cargotec Business Services in Sofia to improve support function efficiency by EUR 20 million Savings from consolidation, outsourcing of certain activities, labour arbitrage and robotics Scope: Finance, Human Resources, Information Management and Indirect Procurement services primarily from Sofia, Bulgaria Good progress in establishing Cargotec Business Services – Cargotec Business Service (CBS) centre in Sofia, Bulgaria officially opened 30 January 2018 SEB Nordic Seminar 9 January 2019 31
Targeting EUR 1.5 billion service and software sales in 3-5 years Cargotec service sales total EUR 907 million in 2017 Spare parts the biggest category, around 50% of total service sales Maintenance around 30% of total service sales Hiab MacGregor Kalmar 2017 2017 2017 MEUR MEUR MEUR Service orders received Service orders received Service orders received 432 262 203 Service sales Service sales Service sales 258 205 445 Spare parts Spare parts Maintenance contracts Spare parts Maintenance Maintenance Crane upgrades Used equipment Installation Used equipment Projects and Voyage Data Recorder Lashing equipment, after sales Year 2017 figures have been restated according to IFRS 15 and 2017 figures are calculated by using the SEB Nordic Seminar 9 January 2019 32 new definitions for the equipment, service and software businesses announced in March 2018
M&A strategy focusing on bolt-on acquisitions Key acquisition criteria M&A focus by business area: Contribution to 15% ROCE target Kalmar Recurring business Expand service footprint and software offering Increase the potential for services through larger installed base and increased presence Hiab Group gearing long term target of 50% Expand geographical presence, service and product offering Net debt and gearing MacGregor MEUR Focus on distressed assets and 800 80% 59.2 % software and intelligent technology 700 60% 46.7 % 46.4 % 45.3 % 36.0 % 33.1 % 719 600 40% 639 622 578 500 20% 503 472 400 0% 2013 2014 2015 2016 2017* Q3/18 Net debt Gearing-% *Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 33
Progress in M&A in 2017 RAPP MARINE GROUP ARGOS INVER PORT SOLUTIONS Strengthen MacGregor’s offering Hiab entrance to Brazilian Broaden Kalmar’s existing for the fishery and research loader crane market service capabilities throughout vessel segment Australia Sales Sales Sales EUR 40 million EUR 5 million EUR 6 million in 2017 in 2017 in 2017 Around 30% of sales from services SEB Nordic Seminar 9 January 2019 34
Acquisition of EFFER to support Hiab’s global offering Effer in brief Strategic rationale Transaction highlights Global leader in the heavy Effer complements Hiab’s Enterprise value EUR 50 cranes segment loader cranes portfolio and million expands the offering in heavy 2017 sales around EUR 71 cranes Acquisition was closed on million and operating profit 6 November 2018 EUR 6 million Leverage Hiab’s global service network to boost Distribution network of over Effer service sales 100 dealers covering 60 countries globally Strenghthen Hiab’s position in Effer’s core market areas SEB Nordic Seminar 9 January 2019 35
Acquisition of TTS marine and offshore business Strategic Overview of the acquired Acquisition rationale businesses Service growth potential Employs 900 people Acquired businesses represent around 90% of total sales of Sales approximately EUR 211 Strengthening MacGregor’s TTS Group position also in China million in 2017* Enterprise value Based on preliminary estimates, Services 26% of revenues EUR 87 million potential cost synergies are estimated to be around The acquisition is subject to EUR 30-35 million on annual regulatory approvals from level competition authorities Expected closing of the transaction in Q1 2019 *The presented TTS business financial figures are calculated based on full consolidation, but their actual impact on Cargotec's financials is subject to applied post-acquisition consolidation SEB Nordic Seminar 9 January 2019 36 method of the joint ventures included in the acquisition.
TTS product portfolio Container, Bulk & Multipurpose & RoRo, Cruise & Navy Offshore Vessels Services Tank Vessels General Cargo 37 SEB Nordic Seminar 9 January 2019
Shaping the portfolio Two divestments made during Q2/18 Divestments Siwertell and Kalmar Rough Terrain Center Both outside of Kalmar’s core areas of container ports, heavy industry and distribution Revaluation of RHI shares during Q2/18, non-cash EUR 30 million charge SEB Nordic Seminar 9 January 2019 38
Our target is to reach 10% EBIT ~10% ~1-2% ~0% ~0.5-1% ~0-1% ~1-2% Improve cost Continuing Growth in efficiency, innovations Kalmar’s Kalmar & leveraging (R&D investments) 7.4% large Hiab sales projects and equipment Service & MacGreqor growth Software equipment Q3/18 LTM* EBIT target EBIT** Target announced in September 2017, target to be reached in 3-5 years *LTM=Last 12 months (Q4/17-Q3/18) **Excluding restructuring costs SEB Nordic Seminar 9 January 2019 39
Highlights of Q3 2018 – Orders received grew in all business areas 8.1% 7.8% 23% growth in orders received 7.4% 7.1% 6.9% 38% increase in Kalmar, 13% in Hiab 72 57 57 57 Sales increased 9% 56 Growth in all business areas Service sales increased 3% EMEA +22%, AMER +3%, APAC -5% Operating profit* at last year’s level Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Operating profit* EUR million Operating profit* margin *) Excluding restructuring costs Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 40
Market Global container throughput (MTEU) – Key driver for Kalmar Source: Drewry 700 environment 600 +5.0% 500 586 558 400 2018 300 200 100 0 1-9/17 1-9/18 Growth in number of containers handled at ports continued Construction output – Key driver for Hiab Source: Oxford Economics Customers’ decision making related to United States Europe automation solutions is slow and starting mainly with phased investments +3.2% +3.4% Construction activity on good level Good development continued in Europe and the US 1-9/17 1-9/18 1-9/17 1-9/18 Long term contracting – Key driver for MacGregor Source: Clarkson Research Market improved in merchant sector, but (number of ships and offshore units) Merchant ships > 2,000 gt (excl. ofs & misc) Mobile offshore units Indicative historical average orders remained below historical levels 1,400 500 In offshore, interest level has increased, Historical average 1,200 Historical average 400 1,000 but activity remains on a low level 300 800 600 683 200 400 515 +33% 56 52 100 +8% 200 0 0 1-9/17 1-9/18 1-9/17 1-9/18 SEB Nordic Seminar 9 January 2019 41
Orders received increased 23% Orders received MEUR 981 1,000 921 131 863 857 822 800 141 784 800 749 124 121 100 +2 % 136 Changes y/y in 126 (y/y) 301 139 comparable FX rates 294 600 288 307 282 MacGregor +4% 279 289 Hiab +14% 260 +13 % Kalmar +41% (y/y) 400 Total +25% 550 486 448 440 432 200 386 369 351 +38 % (y/y) 0 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Kalmar Hiab MacGregor Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 42
Order book improving Order book Order book by reporting MEUR segment, Q3 2018 2,500 27% 1,887 2,000 1,786 1,699 1,684 1,566 513 503 1,500 511 519 481 371 337 294 1,000 329 300 53% 500 1,003 947 895 837 786 20% 0 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Kalmar Hiab MacGregor Kalmar Hiab MacGregor Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 43
Sales increased 9%, operating profit* at last year’s level Sales Operating profit* MEUR MEUR 1,000 80 71.9 886 70 816 805 773 141 57.2 57.0 57.1 56.3 736 60 750 133 130 126 114 50 280 40 260 295 276 500 252 30 20 250 465 10 415 389 371 371 0 0 -10 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Kalmar Hiab MacGregor Kalmar Hiab MacGregor Cargotec total EBIT** *) Excluding restructuring costs, **) Including Corporate admin and support Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 44
Growth in services continued Service and software* sales Service sales grew 3% Services MEUR Software Kalmar +0% (+2% in comparable FX) • +9% in comparable FX and adjusted for 300 divestments and acquisitions Hiab +6% (+7%) 45 250 29 39 32 MacGregor +5% (+7%) 30 Total service sales +4% in comparable FX 200 150 Software sales increased 33% 238 235 229 226 223 100 Service and software sales 50 constitute 33% of total sales 0 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 *Software sales defined as Navis business unit and automation software Year 2017 figures have been restated according to IFRS 15 and calculated using the new SEB Nordic Seminar 9 January 2019 45 definitions for the equipment, service and software businesses announced in March 2018
Kalmar Q3 – Good development in all key figures Orders received continued to MEUR Q3/17 Change Q3/18 increase Orders 351 +38% 486 Growth in automation and projects, received mobile equipment and services Order book 895 +12% 1,003 Sales increased 12% Sales 371 +12% 415 Operating 30.0 +29% Growth in all main geographical 38.6 profit* regions Operating 8.1% +123bps 9.3% Services growth +9% in profit margin* comparable FX and adjusted for divestments and acquisitions Operating profit* increased due to higher sales 46 Year 2017 figures have been restated according to IFRS 15 *) Excluding restructuring costs
Hiab Q3 – Strong orders, operating profit declined Strong development in orders received continued MEUR Q3/17 Change Q3/18 EMEA +15% and Americas +9% Orders 260 +13% 294 received Sales increased +3% Order book 294 +27% 371 Service sales +6% (+7% in Sales 252 +3% 260 constant FX) Operating 33.7 -28% 24.2 Operating profit declined due to: profit* Operating 13.4% -408bps Currency impact, mainly USD/EUR 9.3% profit margin* Product mix and supply chain challenges Investments in sales & and service network, competence and tools Acquisition of Effer announced during the quarter Scott Phillips appointed new President of Hiab as of 1 October 2018 47 Year 2017 figures have been restated according to IFRS 15 *) Excluding restructuring costs
MacGregor Q3 – Orders received increased slightly Orders received increased 2% MEUR Q3/17 Change Q3/18 Comparison period included a large Orders 139 +2% 141 single order of around EUR 25 received million Order book 511 +0% 513 Service orders +8% Sales 114 +14% 130 Sales increased 14% Operating 2.9 -89% 0.3 profit* Service sales +5% Operating 2.5% -231bps 0.2% Operating profit* decreased due to: profit margin* M&A and integration related costs of around EUR 1.5 million Low capacity utilisation in certain product areas 48 Year 2017 figures have been restated according to IFRS 15 *) Excluding restructuring costs
Key figures – Orders received grew 23% in Q3 2018 7 – 9/18 7 – 9/17** Change 1 – 9/18 1 – 9/17** Change 749 +23% 2,406 +15% 921 2,766 Orders received, MEUR 1,699 +11% 1,699 +11% 1,887 1,887 Order book, MEUR 736 +9% 2,364 +1% 805 2,394 Sales, MEUR 57.2 -0% 186.6 -9% 57.1 170.4 Operating profit*, MEUR 7.8% Operating profit*, % 7.1% -67bps 7.9% -78bps 7.1% Restructuring costs, MEUR 2.6 4.7 -44% 19.2 +115% 41.3 52.5 54.5 Operating profit, MEUR +4% 167.4 -23% 129.1 7.1% 6.8% Operating profit, % -36bps 7.1% -169bps 5.4% Net income, MEUR 32.4 +17% 105.0 -30% 37.9 73.9 Earnings per share, EUR 0.50 +16% 1.63 -31% 0.58 1.13 Earnings per share, EUR*** 0.55 +12% 1.85 -9% 0.62 1.69 *) Excluding restructuring costs **) Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 49 ***) Excluding restructuring costs adjusted with related tax effect
Cash flow from operations weak due to supply chain challenges and lower advances received Cash flow from operations MEUR 160 152 140 120 112 100 91 88 74 80 56 60 40 40 27 17 20 12 0 -4 -20 Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 SEB Nordic Seminar 9 January 2019 50
ROCE impacted by restructuring costs ROCE excluding restructuring costs 10% % 10 8 7.4 7.1 6 4 2 0 2013 2014 2015 2016 2017 1-9/18 ROCE-% Operating profit margin %* ROCE (return on capital employed), annualised *) Excluding restructuring costs Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 51
Strong balance Net debt and gearing MEUR 59.2% sheet 800 60% 46.7% 46.4% 45.3% 600 36.0% 33.1% 622 40% 719 639 578 400 503 Net debt EUR 639 million 472 20% (31 Dec 2017: 472) 200 Average interest rate 2.1% (2.3%) 0 0% Net debt/EBITDA 2.5 (1.6) 2013 2014 2015 2016 2017 Q3/18 Total shareholders’ equity Net debt (lhs) Gearing-% (rhs) EUR 1,409 million (1,423) Equity/total assets 40.7% (41.4%) Maturity profile MEUR Well diversified loan portfolio: 250 Bonds EUR 464 million 192 Bank loans EUR 291 million 200 176 167 EUR 300 million revolving credit facility 150 refinanced in Q2/17, the facility is fully 113 100 92 undrawn 100 Balanced maturity profile 50 EUR 113 million loans maturing in 2018 0 2018 2019 2020 2021 2022 2023- Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 52
Appendix 1. Largest shareholders and financials 2. Sustainability 3. Kalmar 4. Hiab 5. MacGregor 53 53
SEB Nordic Seminar 9 January 2019 54
Largest shareholders 31 December 2018 % of shares % of shares % of votes 14.1 % 1. Wipunen varainhallinta Oy 14.1 23.7 2. Mariatorp Oy 12.3 22.9 3. Pivosto Oy 10.6 22.1 4. KONE Foundation 3.0 5.5 12.3 % 5. Varma Mutual Pension Insurance 2.6 1.1 Company 6. Ilmarinen Mutual Pension Insurance 1.5 0.7 Company 7. The State Pension Fund 1.3 0.6 60.0 % 10.6 % 8. Herlin Heikki Juho Kustaa 0.6 0.3 9. Sigrid Jusélius Foundation 0.6 0.2 10. Mandatum Life Insurance Company 0.5 0.2 3.0 % Ltd. Nominee registered and non-Finnish 28.0 Wipunen varainhallinta Oy Mariatorp Oy holders Pivosto Oy KONE Foundation Total number of shareholders 22,510 Others Wipunen varainhallinta Oy is a company controlled by Ilkka Herlin, Mariatorp Oy a company controlled by Niklas Herlin’s estate and Pivosto Oy a company controlled by Ilona Herlin. SEB Nordic Seminar 9 January 2019 55
Solid track record to increase the dividend EUR 1.05 dividend per B share for 2017 Dividend was paid in two instalments (EUR 0.53 and 0.52) 2.50 2.21 2.05 1.95 2.00 51% 49% 1.50 36% 1.11 1.05 50% 0.95 0.89 1.00 47% 0.80 0.55 0.42 0.50 0.00 2013 2014 2015 2016 2017* EPS (reported) Dividend Payout ratio *2017 EPS figure has been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 56
Capex and R&D Capital expenditure Research and development 120 100 3.0 % 100 80 2.4 % 80 60 1.8 % 60 40 1.2 % 40 20 0.6 % 20 0 0 0.0 % 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 Capex Customer financing Depreciation* R&D expenditure % of sales Main capex investments: R&D investments focused on Kalmar assembly unit in Stargard, Poland Digitalisation Manufacturing plant expansion in Kansas, US for Kalmar Competitiveness and cost efficiency of products *) Including amortisations and impairments SEB Nordic Seminar 9 January 2019 57
Hiab’s share increasing in sales mix 18% 22 % 48 % 49% 2016 2017 33% 30% (33) Kalmar Hiab MacGregor Kalmar Hiab MacGregor Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 58
Well diversified geographical sales mix 31% 32% 42% 44% 2016 2017 (33) 24% 27% EMEA APAC Americas EMEA APAC Americas Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 59
Sales by geographical segment by business area 2017 13% (7) 33% 33% (34) (36) 40% 44% 49% (42) (41) (48) 54% 23% 11% (59) (22) (11) EMEA APAC Americas EMEA APAC Americas EMEA APAC Americas Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 60
Cargotec’s R&D and assembly sites EMEA APAC • Arendal, Norway (MacGregor R&D) • Chungbuk, South Korea • Averøy, Norway (Macgregor prod + R&D) (Hiab prod.) • Kristiansand, Norway (MacGregor R&D) • Tianjin, China (MacGregor prod.) • Dundalk, Ireland (Hiab prod. + R&D) • Bangalore, India (Kalmar prod. + R&D) • Witney, UK (Hiab prod.) • Chennai, India (Navis – Kalmar R&D) • Whitstable, UK (MacGregor prod.) • Ipoh, Malaysia (Bromma prod.) • Zaragoza, Spain (Hiab prod.) • Shanghai, China • Uetersen, Germany (Kalmar prod. + WH) (MacGregor prod. + WS + R&D) • Busan, South Korea • Schwerin, Germany (MacGregor prod.) (MacGregor prod.) • Stargard Szczecinski, Poland • Singapore, (R&D) (Kalmar + Hiab prod.) • Bispgården, Sweden (Hiab prod.) Americas • Lidhult, Sweden (Kalmar R&D) • Bjuv, Sweden (Kalmar prod.) • Ottawa, Kansas (Kalmar prod.) • Örnsköldsvik, Sweden • Oakland, California (Kalmar R&D) (MacGregor WS + WH + R&D) • Cibolo, Texas (Kalmar prod.) • Hudiksvall, Sweden (Hiab R&D) • Tallmadge, Ohio (Hiab prod.) • Helsinki, Finland (HQ) • Kaarina, Finland (MacGregor R&D) • Raisio, Finland (Hiab prod.) • Tampere, Finland (Kalmar WS + R&D) SEB Nordic Seminar 9 January 2019 61
Operating profit excl. restructuring costs development Kalmar Hiab MacGregor 160 9.0 % 180 16.0 % 70 9.0 % 8.0 % 160 8.0 % 140 14.0 % 60 7.0 % 140 7.0 % 120 12.0 % 50 6.0 % 120 6.0 % 100 10.0 % 40 5.0 % 100 5.0 % 80 8.0 % 4.0 % 80 4.0 % 30 60 6.0 % 3.0 % 60 3.0 % 20 40 4.0 % 2.0 % 40 2.0 % 10 20 2.0 % 1.0 % 20 1.0 % 0 0.0 % 0 0.0 % 0 0.0 % 2013 2014 2015 2016 2017 Q3/18 2013 2014 2015 2016 2017 Q3/18 2013 2014 2015 2016 2017 Q3/18 LTM LTM LTM EBIT excl. restructuring costs EBIT-% EBIT excl. restructuring costs EBIT-% EBIT excl. restructuring costs EBIT-% LTM=Last 12 months (Q4/17-Q3/18) Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 62
Sales and orders received development Kalmar Hiab MacGregor MEUR MEUR MEUR 2,000 1,400 1,400 1,800 1,200 1,200 1,600 1,000 1,000 1,400 1,200 800 800 1,000 600 600 800 600 400 400 400 200 200 200 0 0 0 2013 2014 2015 2016 2017 Q3/18 2013 2014 2015 2016 2017 Q3/18 2013 2014 2015 2016 2017 Q3/18 LTM LTM LTM Sales Orders received Sales Orders received Sales Orders received Order book Order book Order book LTM=Last 12 months (Q4/17-Q3/18) Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 63
Gross profit development MEUR 26.2 % 1,000 27.5 % 25.8 % 23.9 % 25.0 % 900 21.1 % 22.5 % 852 800 840 830 18.9 % 20.0 % 18.3 % 787 700 17.5 % 600 634 15.0 % 583 500 12.5 % 400 10.0 % 300 7.5 % 200 5.0 % 100 2.5 % 0 0.0 % 2013 2014 2015 2016 2017 Q3/18 LTM Gross profit, MEUR Gross profit-% LTM=Last 12 months (Q4/17-Q3/18) Year 2017 figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 64
Target to improve cash flow Cash flow from operations before financing items and taxes MEUR 400 373 350 315 300 253 250 204 200 181 152 150 100 50 0 2013 2014 2015 2016 2017 Q3/18 LTM SEB Nordic Seminar 9 January 2019 65
Income statement Q3 2018 Figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 66
Balance sheet Q3 2018 Figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 67
Cash flow statement Q3 2018 Figures have been restated according to IFRS 15 SEB Nordic Seminar 9 January 2019 68
Sustainability SEB Nordic Seminar 9 January 2019 69
Sustainability is a great business opportunity We serve an industry, which produces the majority of emissions as well as GDP in the world - Inefficient industry with potential to improve Our vision to be the leader in intelligent cargo handling also drives sustainability - Increasing efficiency and life-time solutions We are in a position to be the global frontrunner, setting the sustainability standards for the whole industry - We are ready to shape the industry to one that is more sustainable 70
Sea Freight Transport is by far the most sustainable transport mode in terms of emissions Compared to transportation of goods by trains, sea freight emits by trucks, sea freight emits by air cargo, sea freight emits ~2-3 times less emissions ~3-4 times less emissions ~14 times less emissions SEB Nordic Seminar 9 January 2019 71
Sustainability is our competitive advantage Sales account for around 18%* of the total revenue in 2017: Significant R&D and digitalisation investments drive the growth of offering for eco-efficiency Systems Efficiency for Emission Resources efficiency environmental industries efficiency efficiency Visibility to identify inefficient use of Offering to support the operations in Technology to enable fuel and Service enabling the extended resources and fuel environmental industries emission efficient offering usage of products or new Software and design system Cargotec solutions for environmental Products with features to decrease applications industries fuel usage and avoidance of Product conversions and maritime hydraulic oil emissions modernizations *Adjusted figure according to IFRS15, not audited. Audited figure before adjustment 19% SEB Nordic Seminar 9 January 2019 72
Key to more sustainable cargo handling business is solution development Waste in cargo handling business due to inefficiencies ~17 billion euros 19 mil CO2 in shipping industry ~2.5 mil barrels (1.8 mil CO2 equivalent tonnes) annually of fuel savings enabled by Cargotec port For moving equipment solutions during past 6 to 10 years empty containers ~31 900 CO2 of emissions from Cargotec eqv. tonnes factories annually SEB Nordic Seminar 9 January 2019 73
Cargotec sustainability managed with clear policies, processes and KPIs on varying areas Cargotec is a supporter of UN Global Compact and other major international sustainability initiatives We have a clear governance on sustainability issues with Board of Directors overview on the subject Safety is our key priority and we have clear improvement program to further decrease our current IIFR rate of 6.1 Human rights supply chain management and energy on the agenda in 2018 74
Performance highlights 2017 82% of employees Supplier code of conduct conducted the code of sent to all strategic conduct e-learning tool suppliers Permanent Code of Offering for eco- Conduct panel and case efficiency 18% of total investigation process sales SEB Nordic Seminar 9 January 2019 75
Kalmar appendix SEB Nordic Seminar 9 January 2019 76
The current replacement market size for key terminal equipment is EUR 1 billion annually and the market is expected to double in the next decade Total Capacity MTEU The replacement market will 1,400 grow in coming years, as the container terminal capacity has 1,200 expanded significantly during 1,000 the last two decades. 800 600 Average lifetime of type of equipment: 400 STS - 25 yrs 200 RTG -15 yrs 0 e1995 e1996 e1997 e1998 e1999 e2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 f2016 f2017 f2018 f2019 f2020 SC - 8-10 yrs RS/ECH/TT – 8 yrs Replacement after lifetime of equipment Source: Drewry reports: Global Container Terminal Operators 2001-2016 Note: 1995-2000 capacity is estimation based on the assumption that the utilisation rate has been between 70- 72% in that period. 2016-2020 forecast based on Drewry’s Global container terminal operators report, published in August 2016 SEB Nordic Seminar 9 January 2019 77
Global container terminal operators – Most capacity expected to be added by Cosco Largest container terminal operators measured by capacity (MTEU) 0 20 40 60 80 100 120 140 China Cosco Shipping * Hutchison Ports PSA International APM Terminals DP World Terminal Investment Limited (TIL) China Merchants Ports CMA CGM ** Eurogate SSA Marine ONE *** NYK # MOL # K Line # Evergreen ICTSI Hyundai OOCL Yildirim/Yilport Yang Ming Bollore SAAM Puertos 2017 2019 2020 2022 Source: Drewry * Cosco figure does not include OOCL terminals in 2017 and 2018 as acquisition not finalised. Chinese and Taiwanese terminals included from 2019 onwards, Long Beach excluded ** CMA CGM includes APL terminals *** International terminals of NYK, K Line and MOL combined as part of ONE merger # Japenese terminals only from 2019 onwards Figures include total capacity for all terminals in which shareholding held (regardless of size of shareholding), i.e. includes double counting SEB Nordic Seminar 9 January 2019 78
Global container throughput and capacity development MTEU 1400 100% 90% 1200 80% 1000 70% 60% 800 50% 600 40% 30% 400 20% 200 10% 0 0% 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 f2018 f2019 f2020 f2021 f2022 Throughput, MTEU Capacity, MTEU Utilisation rate SEB Nordic Seminar 9 January 2019 79
59% of global container throughput is expected to take place in APAC in 2018 Global container throughput expected to grow 5.3% in 2018 AMER 113mteu APAC +5.6% (+24 mteu) (14% of total) EMEA +5.4% (+11 mteu) AMER +3.7% (+4 mteu) 63% of growth will come from APAC APAC 467 mteu EMEA 206mteu (59% of total) (26% of total) Source: Drewry: Container forecaster Q3 2018 SEB Nordic Seminar 9 January 2019 80
Three alliances controlling about 80% of global container fleet capacity Most probably in mid 2018 there will be only 9 major global shopping lines April 2017 Shipping line Alliance/ Vessel sharing agreement (VSA) Maersk 2M 2M P3 (denied) MSC CMA CGM China Shipping Ocean Three China Shipping/ UASC UASC NYK Ocean Alliance OOCL (acquisition ongoing) Grand Alliance Hapag-Lloyd G6 Alliance APL MOL New World Alliance Hyundai Cosco China Cosco Shipping K Line CKYH Alliance The Alliance Yang Ming CKYH Alliance Ocean Network Express Hanjin Evergreen Independent Hamburg Sud • The arrows indicate changes, confirmed or planned, through M&A or JV over the last 18 months. Hanjin bankrupt. Hyundai isn’t currently Total: 17 Sources: Drewry, Alphaliner, Cargotec officially part of any alliance, but formed a cooperative relationship with 2M. (9 after further SEB Nordic Seminar 9 January 2019 81 • Ocean Network Express (ONE) launch April 2018. 5 4 3 consolidations) COSCO Shipping’s planned acquisition of OOCL expected to completed by the end of June • • Analyse excludes Zim, PIL and Wan Hai
Ship sizes increasing dramatically TEU • The largest containership in the fleet has nearly tripled since 2000 • The average size of new builds doubles between 2009 and 2014 Average newbuilding Largest container ship in world fleet delivered in year Source: Drewry November 2015 SEB Nordic Seminar 9 January 2019 82
Kalmar’s operating environment Provides integrated port automation The collaboration platform solutions including software, serving the needs of ocean services and a wide range of cargo carriers, terminals and their Transfer handling equipment shipping partners area Yard Horizontal Transportation Industry leading spreader TOS coordinates and optimises manufacturer the planning and management Quay of container and equipment moves in complex business environments. Navis provides also maritime shipping solutions: Stowage planning Vessel monitoring Loading computer Route planning SEB Nordic Seminar 9 January 2019 83
XVELA provides benefits to ocean carriers and terminal operators Today’s container supply chain is a fragmented and siloed framework Information sharing between parties is not optimally structured – Forms of communication today include email, phone calls, EDI, paper plans – Problems: incomplete data, errors, information not available on time In-house developed XVELA is a many-to-many platform to solve these issues – Real-time stowage collaboration – Port-to-port visibility and collaboration – Synchronisation of planning between carriers and terminals Benefits of XVELA: Faster vessel turn times Operational efficiencies Cost savings SEB Nordic Seminar 9 January 2019 84
Hiab appendix SEB Nordic Seminar 9 January 2019 85
Construction output forecast Bn€ Changes vs last Forecast YoY changes 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 0.0% 0.0% -0.1% -0.1% -0.1% 1.2% 3.3% 2.1% 2.4% 2.3% NAM NAM 0.0% -1.7% -2.4% -2.3% -2.5% -2.4% 0.8% 1.8% 2.9% 3.1% SAM SAM 0.1% -4.1% -3.6% -3.8% -3.7% 3.2% 0.3% 2.3% 1.7% 1.7% NE NE 1.2% 5.6% 5.8% 5.3% 4.7% 7.3% 0.7% 1.2% 1.4% 1.5% UK UK 0.3% 0.4% 0.3% 0.3% 0.7% 2.6% 2.6% 2.4% 1.6% 1.2% DACH DACH -2.0% -0.7% -0.7% -0.7% -0.5% 4.0% 5.3% 2.0% 1.5% 1.6% BENELUX BENELUX -0.1% 0.1% 0.4% 0.5% 0.3% 2.9% 2.9% 2.7% 2.5% 2.3% MED MED -0.3% 3.0% 2.7% 2.7% 2.7% 7.2% 8.6% 3.4% 3.1% 3.0% EE EE -1.3% -1.2% -1.4% -1.2% -1.4% 1.7% 3.4% 3.6% 3.8% 4.0% MEA MEA 0.1% -0.7% -0.9% -0.9% -0.9% 3.7% 4.5% 3.8% 4.0% 4.2% APAC APAC 0.0% -0.4% -0.5% -0.5% -0.6% 2.6% 3.4% 2.9% 3.1% 3.1% Total Total SEB Nordic Seminar 9 January 2019 86 Source: Oxford construction output (All Output series are measured in Billions, 2010 Prices), Forecast Sep 2018 compared to Jun 2018
Global truck volumes Changes vs last Forecast YoY changes (vs. prev. year) 2 017 2 018 2 019 2 020 2 021 2 017 2 018 2 019 2 020 2 021 -1.1% -4.1% -0.6% -12.0% -11.0% 0.6% 21.6% 7.7% -14.7% -4.3% NAM NAM 0.1% 8.3% 4.0% 0.8% -1.1% 8.4% 20.4% 3.9% 1.0% 2.3% SAM SAM -2.8% -8.8% -10.1% -8.0% -9.4% 24.3% 6.0% 2.8% 4.9% 1.1% NE NE 0.0% 4.9% 2.5% 1.3% 1.1% 1.9% 2.5% -4.6% -7.7% 3.8% DACH DACH 0.0% 4.5% -1.7% -1.1% 3.8% -1.6% -6.5% -2.2% 3.5% 8.2% UK/IR UK/IR 0.0% 1.5% 2.2% 2.3% 8.3% 9.6% -7.7% -2.2% -1.4% 6.6% BENELUX BENELUX 0.4% 7.3% 2.9% 3.8% 4.2% -0.8% 15.9% 2.6% 7.3% 2.5% EE EE 9.5% 6.7% 1.1% 1.1% 0.8% 21.0% -0.7% 1.3% -7.9% 5.3% MED MED 0.0% 1.0% 2.7% 0.6% 1.1% -1.4% 0.4% 4.9% 7.5% 3.8% MEA MEA -0.3% 14.9% 2.7% 0.8% 0.9% 40.4% -3.2% -19.9% -0.1% -0.5% APAC APAC -0.3% 10.3% 1.7% -1.5% -1.3% 29.8% 1.0% -13.2% -2.3% -0.4% Total Total SEB Nordic Seminar 9 January 2019 87 Source: IHS Truck registration (Jun 2018), (Sep 2018)
Attractive megatrends and growth drivers Urbanization and Consumption growth driving needs for efficiency MEGA Digitalization and Connectivity enabling new business solutions TRENDS North America and main European markets continue to grow MARKET Developing markets strong load handling equipment penetration potential GROWTH Construction, Waste & Recycling, Logistics and Governmental KEY business segments show continued growth projection SEGMENTS New applications market and segment growth potential PRODUCT Developing for increasing demand in Electrification and Automation OFFERING Growing demand for comprehensive life-cycle service offerings SERVICE and tailored business solutions SOLUTIONS SEB Nordic Seminar 9 January 2019 88
Hiab’s key growth drivers Cranes Tail lifts Truck-mounted forklifts Services Gain market share in big Enter fast growing emerging Accelerate penetration in Increase spare parts capture loader cranes and crane markets and standardise North America and Europe rates driven by connectivity core markets and globalise business and e-commerce model SEB Nordic Seminar 9 January 2019 89
MacGregor appendix SEB Nordic Seminar 9 January 2019 90
Merchant ships: Contracting forecast by shiptype (no of ships) Merchant ship types > 2000 gt, base case Contracting history and forecast September 2018 No. of ships, Merchant ship types > 2000 gt, excl ofs and misc 3,500 3,000 2,500 historical avg 1996-2017: 2,000 1761 vessels 1,500 1,000 500 0 Avg. 96-17 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Tanker LNG/LPG Bulker Container MPP/GC RoRo/PCC Cruise Source: Clarksons September 2018 SEB Nordic Seminar 9 January 2019 91
Merchant ships: Deliveries forecast by shiptype (no of ships) Merchant ship types > 2000 gt, base case Deliveries history and forecast September 2018 No. of ships, Merchant ship types > 2000 gt, excl ofs and misc 2,500 historical avg 2,000 1996-2017: 1562 vessels 1,500 1,000 500 0 Avg. 96-17 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 Tanker LNG/LPG Bulker Container MPP/GC RoRo/PCC Cruise Source: Clarksons September 2018 SEB Nordic Seminar 9 January 2019 92
Offshore mobile units: Contracting forecast by shiptype (number of units) Contracting history and forecast 2015 - 2024, September 2018 No. of units, Mobile offshore units 800 historical avg 700 2007-2017 560 units 600 500 400 300 200 100 0 Avg. 07-17 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Survey Mobile drilling Construction Mobile production Logistics AHTS PSV Rescue & Salvage Utility Support Source: Clarksons September 2018 SEB Nordic Seminar 9 January 2019 93
Offshore mobile units: Deliveries forecast by shiptype (no of units) Delivery history and forecast 2015 - 2024, September 2018 No. of units, Mobile offshore units 800 historical avg 700 2007-2017 579 units 600 500 400 300 200 100 0 Hist. average 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2007-2017 Survey Mobile drilling Construction Mobile production Logistics AHTS PSV Rescue & Salvage Utility Support Source: Clarksons September 2018 SEB Nordic Seminar 9 January 2019 94
Shipbuilding – contracting ships >2000 gt/dwt Contracting Volumes 2009-2018 Estimated newbuilding investment no. of ships $bn Source: Clarksons September 2018 SEB Nordic Seminar 9 January 2019 95 Source: Clarksons October 2018
Shipbuilding capacity and utilisation scenario SEB Nordic Seminar 9 January 2019 96 Source: Clarksons Research September 2018
MacGregor’s asset -light business model gives flexibility Sales & Design & Manufacturing Installation Lifecycle marketing engineering support MacGregor MacGregor MacGregor MacGregor MacGregor Outsourced Outsourced Outsourced Cost-efficient scaling 90% of manufacturing outsourced 30% of design and engineering capacity outsourced SEB Nordic Seminar 9 January 2019 97
Markets recovering slowly Fragile early recovery in container and bulk shipping in risk due to possible trade war impact on global trade Offshore shipping recovery still to take some more time and further restructuring on way to stable recovery Shipping cycle positions; freight/earnings cycles indicative, timeline of each cycle not defined and varies Cruise Weakening market Strong market RoRo/RoPax Recovering market Dry Bulk Weak market LNG Containers Chemical/Specialised Tankers Offshore Multipurpose vessels Dry cargo Product tankers Oil tanker LPG Carriers Crude tankers Gas carrier Car Carriers Offshore Cruise Source: internal & Clarksons September 2018 98
We are capturing ”blue growth” opportunities Seaborne Marine bio- Marine and Tourism Fishing Aquaculture Offshore Offshore Ocean logistics technology seabed mining oil and gas wind energy renewable energy Traditional New New New New New Traditional New New Core Growth Growth Growth Growth Growth Core Growth Growth SEB Nordic Seminar 9 January 2019 99
Disclaimer Although forward-looking statements contained in this presentation are based upon what management of the company believes are reasonable assumptions, there can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. These statements are not guarantees of future performance and undue reliance should not be placed on them. The company undertakes no obligation to update forward-looking statements if circumstances or management’s estimates or opinions should change except as required by applicable securities laws. All the discussion topics presented during the session and in the attached material are still in the planning phase. The final impact on the personnel, for example on the duties of the existing employees, will be specified only after the legal requirements of each affected function/ country have been fulfilled in full, including possible informing and/or negotiation obligations in each function / country. SEB Nordic Seminar 9 January 2019 100
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