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Kalmar’s order growth slows in fourth quarter

Kalmar has announced that its orders received increased by 4% in the last quarter of 2015, compared to 22% in the third quarter and 19% for the year as a whole.

Despite this, the CEO of Kalmar’s parent company Cargotec, said that the value of orders received by Kalmar was “strong” in the fourth quarter, where Kalmar received €395m (US$444m) worth of orders.

Although a geographic breakdown of Kalmar’s received was not available, Cargotec’s orders fell in the fourth quarter year-on-year both in the Asia-Pacific region (by 20%) and the Europe, the Middle-East and Africa region (by 12%). Orders from the Americas slowed in the fourth quarter, compared to the rest of the year, but continued to grow (by 6%). Kalmar’s orders make up 50% of Cargotec’s total orders.

On its business plan, Cargotec said in a statement: “Towards the end of the year [2015], we updated our strategy with the aim of making Cargotec a market leader in intelligent cargo handling, by building on services, digitalisation and people leadership.”

The statement went on to reiterate the company’s intention to invest in research and development. Kalmar is currently investing €3m (US$3.4m) in a new port automation testing and development programme at its Technology and Competence Centre in Tampere, Finland. The platform will primarily be used for testing in customer projects and new product releases.

The investment includes all modules required to run an automated container yard operation, including a total automation system, a new automatic stacking crane (ASC) and the research and development work required for deployment. The platform is expected to be fully operational some time in early 2016.

Higher research and development costs were one reason cited by Cargotec for the decline in Kalmar’s profit margin which occurred from Q3 onwards. The other reason cited was an increase in lower-margin deliveries. The company aims to increase Kalmar’s profit margin to 10% “over the cycle”.

Kalmar’s operating profit, excluding restructuring costs, increased by 4.7% in the final quarter, from €34.3m (US$38.4m) to €35.9m (US$40.3m). Over 2015 as a whole, it increased by 129%, from €56.8m (US$63.8m) to €129.9m (US$145.8m).