As previously announced, the completion of the partial demerger of Cargotec Corporation (“Cargotec”) (the “Demerger”) and the incorporation of a new Kalmar Corporation was registered in the Finnish Trade Register on 30 June 2024.
As a result of the Demerger, Cargotec has updated its segment reporting and from 30 June 2024 onwards Cargotec has two reporting segments, Hiab and MacGregor. The Kalmar segment has been removed. The new reporting structure will be used in Cargotec’s half-year financial report January–June 2024.
To provide a basis for comparison, Cargotec publishes its reclassified financial information of reportable segments and Corporate administration and support functions for all quarters of 2023 and the first quarter of 2024 separately, as well as for the full year 2023. Corporate administration and support functions now reflect continuing operations. Hiab and MacGregor financial information remains unchanged.
Additionally, Cargotec starts publishing a new alternative performance measure for its Hiab segment; Operative return on capital employed (Operative ROCE, defined as operating profit / operative capital employed, last 12 months). To provide a basis for comparison, Cargotec publishes Hiab’s operative ROCE for all quarters of 2023 and first quarter of 2024 separately.
Outlook for 2024 unchanged
The change in the reporting structure will not impact Cargotec’s outlook for 2024 which was updated on 26 June 2024.
Cargotec estimates 1) Hiab’s comparable operating profit margin in 2024 to be above 12 percent and MacGregor’s comparable operating profit in 2024 to improve from 2023 (EUR 33 million).
1) The business area 2024 profitability outlook is presented using the same principles which are applied in the 2023 external financial reporting.
The reclassified financial information included in this release is unaudited.
As announced in a stock exchange release on 1 February 2024, the Board of Directors of Cargotec Corporation (“Cargotec”) has approved a demerger plan concerning the separation of the Kalmar business area into an independent listed company (the “Demerger”). The planned completion date of the Demerger is 30 June 2024. The Demerger is subject to approval by the Annual General Meeting of Cargotec to be held on 30 May 2024. Certain major shareholders of Cargotec, including Wipunen varainhallinta oy, Mariatorp Oy, Pivosto Oy and Kone Foundation, holding in the aggregate approximately 41 percent of the shares and approximately 75 percent of the votes in Cargotec, have indicated their support for the proposed Demerger.
Due to the proposed Demerger, Cargotec presents the Kalmar business area as discontinued operations under IFRS 5 Non-current Assets held for Sale and Discontinued operations starting from the first quarter of 2024 and publishes restated quarterly financial information on its 2023 financials. These restated financials constitute comparative information for Cargotec when the Kalmar business area is presented as discontinued operations.
Under IFRS 5, the result from discontinued operations is reported separately from continuing operations’ income and expenses in the consolidated statement of income. Comparative periods are restated accordingly. The consolidated balance sheet is not restated. The presented discontinued operations include revenue and operating expenses directly related to the Kalmar business area and other income and costs related to continuing operations that are not expected to continue after the Demerger, or would have been avoided without the Demerger. As a result, financial information presented for Cargotec as continuing and Kalmar business area as discontinued operations do not reflect the past or future profitability of either business on a stand-alone basis before the Demerger or after it.
The restated financial information included in this release is unaudited.
Cargotec changed the definition of the alternative performance measure comparable operating profit and discloses figures in accordance with the new definition for the comparison periods 2020, 2021 and 2022.
As stated in the financial statements review 2022, Cargotec changed the definition of the alternative performance measure comparable operating profit starting from 1 January 2023. The restated comparable operating profit will also include the impacts of the purchase price allocation, which amounted to EUR 16 million in 2022. Of these items, EUR 1 million were related to Kalmar, EUR 3 million to Hiab, and EUR 12 million to MacGregor. Comparison figures have been calculated based on the new definition, which is identical to the definition used prior to the previous change in 20211.
Outlook for 2023 unchanged
Cargotec reiterates its outlook published on 2 February 2023 and estimates its core businesses’2 comparable operating profit to improve from 2022 (EUR 384 million) and MacGregor’s comparable operating profit in 2023 to be positive (EUR -47 million).3
1) See the stock exchange release published on 29 March 2021.
2) Hiab and Kalmar excluding heavy cranes and including corporate administration and support functions.
3) The outlook for 2023 does not include the comparable operating profit of Kalmar's heavy crane business which will be discontinued.
Figures in accordance with the new definition for the comparison periods are unaudited.
Cargotec changed the definition of the alternative performance measure comparable operating profit and discloses figures in accordance with the new definition for the comparison period 2020.
As stated in the financial statements review 2020, Cargotec changed the definition of the alternative performance measure comparable operating profit starting from 1 January 2021 to align it with the definition used in the merger prospectus published on 3 December 2020. In addition to the items significantly affecting comparability, the restated comparable operating profit will also exclude the impacts of the purchase price allocation, which amounted to EUR 23 million in 2020. EUR 10 million of the items were related to Kalmar, EUR 2 million to Hiab and EUR 11 million to MacGregor.
Cargotec reiterates its outlook published on 4 February 2021 and expects its comparable operating profit for 2021 to improve from 2020 (EUR 227* million).
*Comparable operating profit in accordance with the new definition published in the financial statements review on 4 February 2021 has been specified from EUR 228 million to EUR 227 million.
Figures in accordance with the new definition for the comparison period are unaudited.
Cargotec applies the new IFRS 15 and IFRS 9 accounting standards as well as the amendments to the IFRS 2 standard starting from 1 January 2018. Cargotec discloses the financial impacts of the transitional adjustments related to the adoption of IFRS 15 and IFRS 9 and the amended IFRS 2, as well as the restated figures for 2017 due to the retrospective adoption of IFRS 15. Cargotec has also aligned the definitions of the equipment, service and software businesses from the beginning of 2018 and discloses the restated comparison period figures of 2017 for the reporting segments.
The adoption of IFRS 15 decreased sales in 2017 by EUR 30.3 million, of which Kalmar’s share was EUR 25.2 million, Hiab’s EUR 0.1 million and MacGregor’s EUR 5.0 million. The 2017 operating profit, excluding restructuring costs, decreased by EUR 4.6 million, of which Kalmar’s share was EUR 3.6 million, Hiab’s EUR 0.1 million and MacGregor’s EUR 1.0 million.
Cargotec confirms the 2018 outlook published on 8 February 2018: Cargotec’s operating profit excluding restructuring costs for 2018 is expected to improve from 2017 (EUR 258.6 million, IFRS 15 restated). The previous 2017 comparison figure for operating profit excluding restructuring costs was EUR 263.2 million.
The adoption of the new accounting principles resulted in an increase of EUR 3.5 million in Cargotec’s equity in the opening balance 2018, including the following adjustments:
Additional information regarding the transitional adjustments is disclosed in Cargotec’s Financial review 2017 under the section Accounting principles for the consolidated financial statements.
Due to the aligned definitions of the equipment, service and software businesses, EUR 32.8 million was restated from equipment sales into service sales in 2017, of which Hiab’s share was EUR 16.2 million and MacGregor’s EUR 16.6 million.
The first interim report of 2018 to be published on 24 April will be prepared in accordance with the new accounting principles.
The restated financial information is unaudited.
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As of 1 January 2013, Cargotec's external financial reporting comprises of three reporting segments: MacGregor (Marine until 31 Dec 2012), Kalmar (Terminals unti 31 Dec 2012) and Hiab (Load Handling until 31 Dec 2012).
In addition, the Bulk Handling business was transfered from MacGregor business area to Kalmar business area as of 1 January 2013. Segment information for 2011 - 2012 has been restated accordingly.
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In October 2011, Cargotec announced plans to accelerate the implementation of its strategic initiatives by changing its operational model. Effective from 1 January 2012, Industrial & Terminal was divided into two new business areas: Terminals and Load Handling. Cargotec's Supply organisation was divided into the new business areas. Business areas Marina and Services will continue unchanged.
Cargotec's external financial reporting segments are Marine, Terminals and Load Handling. These changes were effective from 1 January 2012. Comparative figures will be provided before reporting the figures for Q1/2012.
In June 2009, Cargotec announced the merger of Hiab and Kalmar business areas. As a result, two business areas were formed: Industrial & Terminal, comprising former Hiab and Kalmar business areas, and Marine, which comprises former MacGregor business area.
Cargotec will as of 1 January 2010 report financial information in two reporting segments: Industria & Terminal and Marine. On these reporting segments, Cargotec will disclose quarterly figures for orders received, order book, sales, operating profit and number of employees. In financial reporting the third business area, Services, will be included in the figures of these two reporting segments while its sales will continue to be reported as additional information.
In addition to segment reporting, Cargotec will continue to disclose quarterly sales and number of employees by geographical areas, which are EMEA (Europe, Middle East and Africa), Americas and Asia-Pacific.
The first interim report of 2010 to be published on 29 April 2010 will be prepared according to the new reporting segment structure. Cargotec's 2007-2009 financial information has been restated to comply with the new reporting segment structure. The restated comparison figures are available through the attached link.