Konecranes benefits from Terex MHPS acquisition in interim results

Konecranes benefits from Terex MHPS acquisition in interim results
The MHPS integration is ahead of schedule according to Konecranes CEO Panu Routila

Konecranes exceeded growth expectations in the first half of 2017 as orders received shot up by 68.4% to US$1.77bn.

This was largely due to the acquisition of Terex’s Material Handling and Port Solutions (MHPS) for US$915m and US$22.8m in Konecrane shares.

Elsewhere orders booked rose by 53.9% to US$1.87bn and sales grew by 49.9% to US$1.72bn.

The adjusted EBITDA rose by 5.5% to US$95.3m. Again this is largely due to the acquisition of MHPS as well as cost-saving measures implemented in 2016-2017. However the divestment of STAHL CraneSystems affected the figure by around US$17.4m.

Speaking at a press conference Konecranes CEO Panu Routila explained that order intake is expected to remain similar for the rest of 2017.

“The market situation is pretty stable, not robust, but pretty stable. There are no discussions for big orders at the moment, rather we have a stable level of small and medium sized orders,” he stated.

The company pointed to economic activity in Europe and the US as influencing the solid first half of the year. Meanwhile an increase in global container throughput of around 6% also aided growth.

The integration of MHPS is ahead of schedule, and the company expects to implement US$52.3m synergies by the end of 2019 , up from US$40.7m.

Routila said: “The order book for most of our new Konecranes Gottwald and Konecranes Noell products has increased as our MHPS acquisition brought continuity to these businesses.

“Order intake growth in Business Area Industrial Equipment was led by the crane component business in EMEA and the Americas.”

The company is in the process of optimising its industrial crane manufacturing in several countries including Australia, Canada, India, South Africa and Switzerland.

Routila said: “We have been putting a lot of effort into the integration activities. While there is still much work left to do for the rest of 2017, we are already planning our integration activities for 2018.”