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Hiab investor event: Addressing operations and securing long term growth


Scott Phillips in Hiab investor breakfast: “With Hiab’s dedicated team of almost 4,000 people, my ambition is to continue innovating in technology, services, support our customers throughout the product’s lifecycle and increase the profit margin in the business.”

Cargotec’s investor relations organised Hiab investor breakfast in Helsinki on 21 March. The event included presentations by Hiab’s new president since October 2018, Scott Phillips, together with Hiab’s CFO Simon Greaves and Jan-Erik Lindfors who is in charge of Hiab’s new business solutions. The event was well attended with 20 investors and analysts participating.

Hiab is one of Cargotec’s three business areas. In terms of sales, Hiab is the second largest business area after Kalmar, but in operating profit margin Hiab ranks the highest. In 2018, Hiab’s sales were around 1.1 billion euros and operating profit totalled approximately EUR 134 million, representing 11.6 percent of sales. Both sales and operating profit have developed well during the last years – compared to 2013 sales have increased by 37% and operating profit almost six times higher. Hiab’s offering consists of loader cranes and various other load-handling solutions, which are typically attached to trucks. New equipment represent 76% of sales and service sales 24% of Hiab’s total sales.

Hiab investor day. March 2019

In his presentation, Scott Phillips reflected his first months in Hiab. He emphasized that the main strengths of Hiab are excellent product quality and performance, strong brands, loyal customers as well as the competence and engagement of the personnel. In terms of improvement opportunities, Scott pointed out operational performance, the opportunities in services, need for continuous improvement and the speed of execution.

Simon Greaves gave a detailed analysis on the different elements that led into Hiab’s operating profit decline in 2018. Even though Hiab’s operating profit was supported by sales growth, especially FX headwinds and supply chain inefficiencies led to lower profitability compared to 2017. In terms of FX, especially the weaker USD compared to the euro had a negative impact, as Hiab’s equipment is mainly assembled in Europe and then exported to the US. Hiab has several actions on-going to solve the supply chain challenges with a dedicated task force and program focussing for example on better internal planning and forecasting as well as supplier management and development. However, it will still take time to solve the issues.

Services continue to be a major opportunity for Hiab. Scott Phillips highlighted that services and digital solutions are fundamental for customer experience and for delivering business value. Hiab’s large installed base with 135,000 heavy equipment and 250,000 tail lifts offers a solid base for services. Hiab has also launched the Procare repair and maintenance offering in five markets and as a global concept – so far there are close to 3,000 contracts sold to customers. In 2018, Hiab opened 15 new services workshops to improve customer service and capture the service potential better.

Jan-Erik Lindfors, VP New Business Solutions, described the recent developments in digital solutions. He highlighted that service and digital solutions are fundamental to customer experience and delivering business value. Audience was pleased to hear that Hiab has launched several digital solutions, for which customers are willing to pay.

The feedback from the event was very positive. Investors and analysts appreciated the possibility to discuss directly with business management, and they were particularly keen to get more insight related to the cyclicality of Hiab, supply chain challenges and related costs, growth possibilities in China and APAC, service growth opportunities and market drivers.


Earlier during the week Cargotec arranged its Annual General Meeting, where CEO Mika Vehviläinen gave a presentation on Cargotec’s year 2018. See also the Mika’s AGM presentation video recording.

Later in 2019, Cargotec’s investor relations will also arrange a Service Day in Helsinki (June 11), Site visit to Hiab and Kalmar assembly site to Stargard Szczecinski, Poland as well as a site visit to Shanghai as part of the Finnish Industrial week in China.

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