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Cargotec’s orders up but profits down

Palfinger has revealed its financial results for the year so far, reporting a 10 per cent increase in revenue, with a record-breaking target in sight.

Cargo and load handling solutions company Cargotec has released its financial statements for 2018, which found the company’s profits did not reach its target.

While its ports business Kalmar saw orders received and operating profit increased, but on-road load handling equipment business Hiab saw operating profits decline while demand continued to be strong.

The company’s offshore and marine business MacGregor reported an increase in orders received but has found the market environment remained challenging.

During the October to December quarter, the amount of orders received increased by 26 per cent and totalled around $AU1.58 billion, with sales increasing by three per cent.

Cargotec’s operating profit during this period was around $AU97.16 million and represented 6.2 per cent of sales. Its cash flow from operations before financial items and taxes totalled around $AU137 million, with the net income for the period amounting to around $AU54.4 million.

The company expects its comparable operating profit for 2019 to improve from 2018.

Cargotec CEO Mika Vehviläinen said the year was twofold for the company, with orders growing across all of its business areas but falling behind its target to improve its results.

“Kalmar’s operating profit improved, but the weaker results for Hiab and MacGregor led to a lower operating profit at group level compared to the previous year,” Vehviläinen said.

“Although the demand for Hiab’s equipment and services continued to grow strongly, its operating profit declined, particularly as the US dollar weakened against the euro, but also due to challenges with the supply chain and related additional costs.

“Throughout the year, Kalmar received several orders that benefit from advanced automation technology solutions. We also moved in the right direction with our software and digital solutions. In line with our strategy, we will continue to invest in the development of digitalisation solutions,” he said.

The company’s goal is to increase the sales of its service and software business from around $AU1.75 billion to $AU2.39 billion over the next two to four years.

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