26.04.2013

Hiab stumbles

Loader crane manufacturer Hiab has reported a five percent fall in first quarter revenues to €192 million, with a 12 percent drop in order intake to €216 million. As a result the company’s order book was seven percent lower than at the same time last year at €214 million.

Operating income plummeted from €7.5 million a year ago to €2 million this year, after taking €1.6 million in restructuring charges.

Sister company Kalmar, which builds port handing equipment including reach stackers, fared better with revenues up one percent to €323 million and order intake rising nine percent to €366 million lifting its order book by 18 percent to €1.1 billion. Operating income was 13 percent higher at €7 million.

Parent company Cargotec, which also includes MacGregor, saw revenues drop 14 percent to €679 million, while pre-tax profits slumped from 34.7 million in the first quarter of 2012 to €10.8 million this year. The company expects to do better throughout the rest of the year and is not changing its full year projections.

Most surprising of all perhaps is that geographically sales in Europe were up three percent, while in the Americas they were down 10 percent and in Asia Pacific they fell 36 percent.

Cargotec chief executive Mika Vehviläinen said: “In terms of order book development, the markets began the year on a positive note. We are satisfied with our growth in orders of seven percent. In MacGregor, with the merchant shipping markets remaining subdued, orders chiefly comprised marine cargo handling equipment for RoRo vessels and offshore support vessels. Orders also developed favourably for Kalmar, but those for Hiab fell somewhat compared to the rather high figure recorded for the comparison period in the previous year.”

“Sales fell by 14 percent, mainly due to low delivery volumes by MacGregor, as customers delayed their receipt of deliveries. Low delivery volumes reduced MacGregor's profitability. However, we foresee higher sales in the forthcoming quarters. At Kalmar and Hiab, much work remains to be done before we can achieve a satisfactory profit level. In general, we cannot rest content with our profit level for the first quarter, we continue determined measures aimed at improving our profitability.”

Vertikal Comment

This is a little bit of a surprise for the Hiab business, but it is still undoing some of the mistakes made in earlier years to centralise everything.

The company has good products, a strong brand name and some good people so should bounce back just fine if it does not change its strategy again before giving it time to work and bed in.