11.06.2012

Cargotec issues profit warning

Cargotec, owner of Hiab and Kalmar has issued a warning that lower margins in its Kalmar/Terminals business will result in lower profits for 2012 than it had suggested when it issued its first quarter results back in April.

The company still expects revenues to increase in line with its original expectations, and for profit margins within both Terminals and Load Handling divisions to be higher than last year- just not as much as forecast for the ‘Terminals’ division.

The company says that it will initiate actions to improve efficiency and profitability in its Terminals and Load Handling segments (Hiab).

Vertikal Comment

The information from Cargotec does not given any clues as to why margins will be lower, clearly it can only be pricing, material/labour costs or a spike in overheads. One cannot help but wonder why Hiab – the Load Handling division - will also be subjected to ‘actions’ along with the Terminals business.

Both divisions are still settling down and adjusting after back and forth changes in strategy imposed from above. The last thing they both are likely to need now is further ‘actions’ from above.

Hopefully these words are intended to reassure institutional investors that management is ‘on the case’ and taking action, rather than another round of restructuring.