Konecranes - Financial statement release 2025
00:00:08 - 00:00:54
Linda Häkkilä: Hello all, and welcome to follow Konecranes Q4 2025 results webcast. My name is
Linda Häkkilä. I'm the VP, Investor Relations here at Konecranes, and with me today as our main
speakers, we have our CEO, Marko Tulokas, and our CFO, Teo Ottola. Before we proceed, I would
like to remind you about the disclaimer, as we might be making forward-looking statements. As per
usual, we will first start with presentations both from our CEO and CFO, and after that, we will start
the Q&A session. We are happy to answer your questions through the conference call lines. But now,
without any further comments, I would like to hand over to our CEO.
00:00:57 - 00:01:50
Marko Tulokas: Thank you, Linda, and good afternoon, from a cold but very sunny Helsinki. I'd like to
start with some general statements. It was a really very strong year for Konecranes, and I'm very, very
proud of our team and very proud to be part of the Konecranes team, particularly in a year like 2025.
Konecranes has a very sound business model. We've been executing our strategy, and that, of
course, in this sort of environment has really showed an improved resilience in our results. It was a
very uncertain environment last year. We focused on executing our strategy and focused on the most
important things. The year started on uncertain terms, but we acted fast and early. Whether it's on
pricing, focus on execution, or tight cost control.
00:01:50 - 00:02:49
Marko Tulokas: Towards the second half of the year, the market environment stabilized, and
particularly in the delivery side it was visible and that helped us to finish the year strong. Now, when
we look towards 2026, we have a good order book in place. The structure is solid, and our strategy for
2026 has a very good roadmap in place. So, I'm really confident for the year 2026. Now let’s look at
how the year turned out and then also how the quarter four looked like. Throughout the year, the
demand environment stayed positive overall. There was a lot of positive development in many
customer segments, and Konecranes' broad presence in different customer sectors and geographies
helped us in this sort of volatile environment.
00:02:49 - 00:03:49
Marko Tulokas: Our orders were strong, particularly in Port Solutions and Industrial equipment, so we
grew by almost 12% in comparable terms in 2025 compared to 2024. The demand on Industrial
Service was quite a tough demand environment, but even in this environment we were able to
strengthen our agreement base. We took very good care of our pricing and ensured that we adjusted
our cost base to the prevailing conditions. We also took care of our margins and cost structure, good
execution in our project business, and we continue to roll-out our products according to our strategy.
That meant that we were able to complete the year with almost a one‑percentage‑point improvement
in comparable EBITA at 14% record-high level.
00:03:49 - 00:04:32
Marko Tulokas: Moving on to quarter four. In quarter four, our orders were also very good. We
continued a very solid order intake and also sales, but it's also noteworthy that both decreased
against a very strong comparison quarter four of 2024. Orders were down four percent, and net sales
were roughly flat in comparable terms. Quarter four in 2024 had a very strong order intake in Port
Solutions, but also in Industrial equipment, where both actually had the second-highest quarter of all
time in Konecranes. That makes quarter four of '25 also very satisfactory for us.
00:04:33 - 00:05:31
Marko Tulokas: Our order book continued to strengthen, and it was three percentage points higher or
seven percentage points in comparable terms. Our profitability improved and increased to 14.1%. It
was really a very good project execution in Industrial Service, Industrial equipment, and in Port
Solutions. Port Solutions with very good margins, but with the slightly lower volume, and we kept our
cost control intact, and had a bit of pricing and tariff tailwind, but less than we had in quarter three.
The order book improved, and that means a solid start for 2026. Now, if we look at the market
environment, generally, how best to describe it, maybe one way to say that the market and the
customers have gotten used to the uncertainty.
00:05:31 - 00:06:40
Marko Tulokas: So, there is a cautious positive development in the capacity utilization rates, as it's
visible in this Industrial Service and equipment slide. It shows the capacity utilization rates in the three
main market areas, our own funnels, and our customer demand how we see it, European sales
funnels are good on a solid level. There are some signs of improvement, but of course customers
continue to be rather cautious around this type of volatile environment. In the United States, the
previously very strong Industrial equipment funnel has somewhat flattened out, but on the other hand,
on the service side, we see some signs of improvement. Customers are starting to use the service
that they may have put on hold temporarily during the tariff-related uncertainty. It's too early to say
how this actually pans out during this year, but we are optimistic in general about the market
environment and continue to be so. In the Asia Pacific, the market continues, and the funnels
continue to be on a stable level, but the tough competition continues, particularly from the Chinese
competition.
00:06:40 - 00:07:42
Marko Tulokas: If you take a look at the Port Solutions segment. Here, the container throughput
index, as we have discussed before, is the main indicator, and that continues to be on a very good
level overall. Maybe there is some flattening in the growth rate, but it's still very positive. Our funnels
are continuing to be good. There are big and small cases in the funnel, and it is good to remember
here that, besides the obvious container throughput traffic indicator, there is the long-term prevailing
trends in Port Solutions that are driving investments. That comes from the automation trend, the
prevailing consolidation trend in that industry, changing the traffic routes driven by the repatriation,
and changing manufacturing locations. We continue here to have a positive general view on the
market, as we also had last year.
00:07:45 - 00:08:23
Marko Tulokas: Iterating again, a bit more about quarter four, the development against the strong
comparison period, and how the past two years have gone, as you see here, because the order
intake in quarter four was slightly down from previous year quarter four, but, last year the order intake
was actually very good and better than the previous year in the first three quarters. There was a
decrease in quarter four in all business areas. Some increase in Europe and some decrease in the
Americas and APAC. Actually, the same profile is true for the sales side of things.
00:08:30 - 00:08:58
Marko Tulokas: Next is time to look at the order book situation. We have had a solid above one bookto-bill ratio throughout last year. We've been strengthening our order book throughout the whole of
last year, since quarter four of 2024. We have a particularly strong order book situation in Port
Solutions. It is positive in Industrial equipment with a also positive mix, but it's also a bit down in
Industrial Service.
00:08:58 - 00:10:02
Marko Tulokas: Here you see the profitability development over the last two years, and again
compares the quarters to each other. This is really a very strong progress and a very strong execution
of our strategy. There is an increase in Industrial Service and Industrial equipment in quarter four,
some decrease in Port Solutions. As I stated earlier, that's mainly driven by the volumes. Port
Solutions continue to have good margins and good execution, and they also had a very good quarter
four last year, some with less tariff tailwind, but still some was visible in quarter four, really good cost
management, and a slightly weaker mix in Port Solutions. We are very happy with this 14.1%
outcome in quarter four last year. That helped us to reach this, almost a percentage point
year‑on‑year, full-year improvement on profitability.
00:10:06 - 00:11:11
Marko Tulokas: It's time to take a look at how we track our profitable improvement progress or
process. This is actually the third consecutive year in all three business areas where we consistently
improved our profitability. All three business areas are well within their defined mid-term profitability
ranges. We've done this under a rather challenging demand environment. However, at the same time,
it is true to say that we have not really had a challenging downturn in terms of volumes yet. As you will
see here, there's been pressure on the volumes, and we've seen continuous good profitability
improvement. With additional volumes, we are confident that this continues to be a good story. Now I
would like to hand over to Teo, and then I'll come back after a few slides to talk about the demand
outlook and a couple of other things.
00:11:13 - 00:12:40
Teo Ottola: Thank you, Marko. Let's take a look at some of the business area numbers in more detail.
Before going there as usual, let's take a brief look at the comparable EBITA bridge between Q4 '24
and Q4 '25. We had close to one percentage point improvement in the EBITA margin in a year-onyear comparison, and this translates into roughly 5 million euros improvement in EBITA in euros, and
let's unpack this now, next a little bit. Pricing impact year‑on‑year was roughly three percent. Then,
when we combined that information, the fact that there was a sales decline in comparable currencies.
This represents the underlying volume decline of some four percent or so, which obviously is not good
from the profit and profitability point of view. However, net of inflation pricing, mix, and particularly
good project execution all worked in a positive manner. As a result of that, the net of all of those
impacts is positive by 13 million, as we can see, as a combination of volume pricing mix and variable
cost on the slide.
00:12:40 - 00:13:37
Teo Ottola: Fixed costs continued to be well under control, with only a 2 million increase in the yearon-year comparison. Whereas then the translation impact as a result of FX differences was a clearly
negative number, minus seven. As a result of all of these ten combined, we end up with the
improvement of roughly 5 million euros in year‑on‑year comparison. Then moving on to the other
business areas, starting with Industrial Service. We had order intake of 380 million euros. This is
actually a decline in reported currencies, but an improvement of more than two percent in comparable
currencies. As already mentioned in connection with the bridge, the FX differences continue to play a
big role now in the fourth quarter as well.
00:13:38 - 00:14:48
Teo Ottola: Taking a look at the different parts of the business. Field service orders declined in the
year-on-year comparison, whereas parts business increased, and then when we take a look at the
regions, EMEA did well. There was an increase, whereas then Asia-Pacific and the Americas both
saw a decline in the order intake. The agreement base actually grew by 4.4%. Like Marko already
mentioned, the order book decline of seven percent. That's a big number, but in reality, that is almost
all, or let's say, everything actually is in relation to the currency changes. Net sales 3.5% higher
year‑on‑year in comparable currencies. The story is very similar to what it is in the order intake. Parts
did better than the field service, and among the regions, EMEA did better than Asia Pacific and the
Americas.
00:14:48 - 00:15:47
Teo Ottola: Comparable EBITA margin 21.9% on a very good level, 1.3 percentage point
improvement year‑on‑year. The improvement did not obviously come from the volume, as the net
sales increase is roughly in line with the pricing change. It actually more came from pricing and good
execution, as well as efficient cost management in general. Then moving on to the Industrial
equipment. There, we have an order intake increase in comparable currencies of roughly one percent.
However, when we take a look at the external orders, this is down slightly by almost one percentage
point against fairly tough comparables. The fourth quarter of 24 was very good from the Industrial
equipment order intake point of view.
00:15:47 - 00:16:48
Teo Ottola: Of the business units, we had growth in components in an year‑on‑year comparison, we
had a decline in process cranes and standard cranes as well. A slight decline. One could maybe also
say that this was flattish in a year-on-year comparison. Of the regions, again, EMEA did fairly well, so
increase there. Whereas then we had a decline in the Americas and APAC. In a sequential
comparison, taking a look at the business units, component orders actually rose also in a quarterly
comparison, so the component orders in the fourth quarter were very good. We had a decline in port
cranes, as well as in the year-on-year comparison. Then, standard cranes were fairly flat in a
sequential comparison, similar to what they were in a year-on-year comparison as well. Here, our
order book rose by two percent, and of course, with comparable currencies, even more.
00:16:48 - 00:17:29
Teo Ottola: Net sales were up three percent roughly. Taking a look at the total volume, or the external
volumes, both are roughly three percent up. The sales mix was such that it was a little bit more
favorable from the margin point of view, now in the fourth quarter of '25 than a year ago. Then, when
taking a look at the comparable EBITA margin, 11.7%, excellent improvement of more than two
percentage points in a year-on-year comparison. Again, good execution, pricing and the already
mentioned mix supported the profitability in the fourth quarter.
00:17:32 - 00:18:28
Teo Ottola: Then Port Solutions. Order intake €406 million. This is a decline of roughly 11% in a
year‑on‑year comparison. Of course, against very tough comparables. Also, here, the fourth quarter
of '24 was very good from the order intake point of view. When we take a look at different businesses
with Port Solutions. Lift trucks actually had good activity, as well as RTGs, and port services were
relatively flat in a year‑on‑year comparison. Then, when taking a look at sequentially, particularly the
business units that are more short-cyclical like lift trucks and port service, lift trucks had an increase
also in a sequential comparison, so Q4 was higher than Q3 and port service was relatively on the
same level in the fourth quarter as in the third quarter, so flat, exactly like year‑on‑year comparison as
well.
00:18:30 - 00:19:26
Teo Ottola: Net sales declined by as much as seven percent in a year-on-year comparison. This was
as a result of the order book timing and as such as expected already earlier. Order book, however, is
clearly higher than it was a year ago. Thanks to good order intake that has been there basically
throughout the whole of '25. Comparable EBITA margin, 9.2%. This is a decline of half a percentage
point. This primarily comes from the lower volume. Sales were lower than a year ago. Mix did not help
here. In ports, it was rather negative than positive in year-over-year comparison, but this was partly
offset by very good execution and project execution in the fourth quarter within the ports business.
00:19:30 - 00:20:15
Teo Ottola: Then a couple of comments on the balance sheet side. Let's start with the net working
capital. As usual, net working capital has continued to be on a very low level, so there is no
meaningful change from the third quarter, obviously, with the structure being a little bit different.
Inventories have turned into accounts receivable, but otherwise are very much on the same level. The
improvement in comparison to a situation a year ago comes from accounts receivable as well as
advanced payments. Then on the right-hand side, we can see the free cash flow, which continues to
be on very good record levels, actually also for '25. The cash conversion continues to be clearly
above 100%.
00:20:17 - 00:20:55
Teo Ottola: Then, consequently, as a result of the cash flow, our balance sheet from the net debt
point of view looks very strong, or actually, we have net cash in the amount of more than 160 million
at the end of the year. Then, finally, from the balance sheet point of view, the return on capital
employed on comparable terms was 22.1% at the end of '25. I will invite Marko back to talk about the
outlook for '26.
00:20:57 - 00:21:49
Marko Tulokas: Thank you very much, Teo. Now there is the outlook for '26, but before that, some
other additional things, of course, our solid progress, the very nice development, strong cash flow,
and balance sheet have two outcomes. Our board of directors is proposing to the AGM a split with a
one-to-three ratio. That is due to the high price and to enhance the liquidity of the shares. We also
have the board proposing to the AGM that we increase our dividend from the previous year's €1.65
level to €2.25 per share for 2025, which is very much in line with our stable to increasing dividend
policy.
00:21:52 - 00:22:57
Marko Tulokas: Now to the demand outlook. Although there is volatility in the marketplace, we expect
several sectors to keep the demand up. In the industrial customer segment, we expect the demand
environment to remain at a healthy level. For the port customers, the container throughput continues
to be on high level, as we saw before. There are these long-term prospects in that business. In
general, the long-term drivers and trend are supporting a strong container handling demand in the
future. The outlook continues to be good. At the same time, it is good to keep in mind that this
uncertainty is related to geopolitical decisions, trade policy decisions, and the tensions, which remain
high, and they may have a positive and negative impact due to our demand picture that may also
come quite quickly. However, generally speaking, we have a positive outlook on the market.
00:23:00 - 00:23:50
Marko Tulokas: Finally, let's look at our financial guidance. We have a starting order book that is
better, as was already elaborated on by Teo and me earlier. The demand outlook is stable, so we
have a confident but realistic picture of the demand environment. We are also conscious of the
market uncertainty. We expect our net sales to remain approximately at the same level or to increase
in 2026 compared to 2025. As you saw, our margins have been developing very well in '25, and we
expect these margins to remain approximately on the same level also in 2026 compared to 2025.
With that, I thank you all very much, and we can move to the questions and answers. Thank you.
00:23:50 - 00:24:01
Linda Häkkilä: Thank you, Marko and Teo, for the presentations. Now we will start the Q&A session.
Operator, we are ready to take questions.
00:24:04 - 00:24:28
Operator: If you wish to ask a question, please dial pound key five on your telephone keypad to enter
the queue. If you wish to withdraw your question, please dial pound key six on your telephone
keypad. The next question comes from Daniela Costa from Goldman Sachs. Please go ahead.
00:24:29 - 00:24:53
Daniela Costa: Hi. Good morning. I have three questions, if possible. First, how do you see the mix in
Port Solutions going forward? I know you mentioned here that it was slightly disadvantageous. I don't
know if it's just one of these quarters or, given the nature of the equipment, maybe more larger
equipment, if that's something that will continue, and then I'll ask my other questions right after.
00:25:02 - 00:25:07
Marko Tulokas: The port mix going into next year it is approximately flat, or neutral the impact. I guess
that is Teo hopefully your conclusion also.
00:25:08 - 00:25:35
Teo Ottola: That is actually my conclusion also, and I think that what you are referring to with the
larger equipment. We have been talking about that potentially mix might be weaker going forward in
case the product, or let's say the demand, moves more towards the heavier equipment. However, that
has not happened to the extent that we would be expecting a deterioration in the mix for this year.
00:25:35 - 00:25:36
Marko Tulokas: Right.
00:25:36 - 00:25:59
Daniela Costa: Got it. Then, I guess we have seen in some regions quite steep moves on things like
steel prices. Can you talk us through a little bit about how we should think about that, given the lag
between orders and sales? The pricing that you're putting out at the moment, do you expect that to be
a headwind in the shorter term, or not really you can pass it all through?
00:26:01 - 00:26:04
Marko Tulokas: Your question was particularly about steel prices, right?
00:26:05 - 00:26:05
Daniela Costa: Yes.
00:26:05 - 00:27:15
Marko Tulokas: The steel prices throughout 2025 have been approximately flat, and there's actually a
slight positive or from our point of view, positive. In that, there's actually a somewhat lower quarterone steel price rate than there was in quarter four of 2025. The outlook is or the forecast is that there
would be a minor increase in steel prices in 2026. But of course, only time will show how that will
materialize. Our approach has been and continues to be so, as steel is for many of our products a
reasonably significant cost component and we will pass on steel costs in our prices. That's how all our
pricing systems and our configurations have been built. Finally, there are some regulatory
developments in the market, and this CBAM is one of them, that of course, eventually that CBAM
regulation, although it has no direct impact on our products and so forth, that that may drive steel
costs up in the longer term, but that's not in the immediate visibility at the moment.
00:27:15 - 00:27:31
Daniela Costa: Got it. Thank you. Then the final one, just in terms of, as you have obviously very
strong free cash flow. Looks like a decent size comes from the payables within working capital. Can
you talk a little bit about exactly what that is and how we should think about payables going forward?
00:27:33 - 00:27:38
Marko Tulokas: I'm not quite sure what your question was. Are you talking about the capital allocation
of our balance sheet in general?
00:27:38 - 00:27:39
Daniela Costa: No, free cash flow.
00:27:42 - 00:27:49
Marko Tulokas: Yes, are you referring to the dividend policy only or to the question of other means of
distributing the cash?
00:27:50 - 00:27:59
Daniela Costa: No, I'm just actually asking about free cash flow. Within your cash flow statement,
there is a big positive of payables in the working capital.
00:28:00 - 00:28:01
Marko Tulokas: Yeah fair enough.
00:28:02 - 00:29:07
Teo Ottola: Maybe commenting on the net working capital as a whole. So now, at the end of '25, we
are on a very beneficial level, and we are several percentage points better than the mid-term target,
which is that we should be below 10% of rolling 12-month sales in net working capital. Now we are
clearly below that. The situation is very beneficial from the net working capital point of view. If the
question is that, is that something exceptional, or will it stay here, or will it even improve? One could
maybe say that, in the midterm perspective, this is on the better side of the average. Maybe the
overall in a way level on a long term basis could be even a little bit higher for net working capital, but
we definitely so that we aim to be below the 10% threshold of the rolling 12 month sales.
00:29:07 - 00:29:38
Teo Ottola: Then of course, we will need to allow volatility in both directions, as we are now seeing a
very good situation. It may be that in some quarters we are seeing a little bit worse situation. So, the
payables, accruals, and advanced payments, all in combination is very important. I would still stress
the importance of the advanced payment, so this is a lot customer project timing related and how the
net working capital develops from one quarter to another one.
00:29:38 - 00:29:39
Daniela Costa: Thank you very much.
00:29:40 - 00:29:40
Marko Tulokas: Thank you.
00:29:44 - 00:29:50
Operator: The next question comes from Antti Kansanen from SEB. Please go ahead.
00:29:53 - 00:30:16
Antti Kansanen: Thanks, guys. It's Antti from SEB. A few questions from me as well. I'll start with the
guidance of flat to growing sales, and especially on the Port Solutions side, how much of the backlog
do you currently have? Do you expect to convert revenues during '26, or if you don't want to give the
number, how does that compare to the situation a year ago?
00:30:17 - 00:30:39
Teo Ottola: We may not give the direct number for the first question, but if we take a look at the
overall order book, now that we have at the end of '25 for '26 and compare that to how much order
book we had one year ago for 25, the difference is now more than 100 million.
00:30:40 - 00:30:41
Marko Tulokas: For all three BAs.
00:30:41 - 00:31:20
Teo Ottola: For all three BAs. Then it is fair to say that the ports business is a clear majority of that,
particularly now that the FX differences are impacting so much to the order book of the service
business. That basically means it is the same number or maybe even slightly more for ports than what
it is on the group level. This is, of course, with reported currency. If you take a look at comparable
currencies, Marko showed both numbers. Then, of course, that number is higher, about twice as high,
not for ports but for the group.
00:31:22 - 00:31:52
Antti Kansanen: Yes, sure. I was also thinking on the guidance. If we talk about, let's say, on the lower
end of it, that your sales will be on the same level as in '25. Would that imply actually that volumes
would be down, I don’t know clearly? But anyways, one would assume, that Teo, you talked about the
net price impact on Q4, one would assume that positive pricing continues into '26. How should we
think about that volume pricing trend in the backlog?
00:31:52 - 00:32:39
Marko Tulokas: Of course, we were saying earlier, the starting point is positivity with the stronger
order book, and of course, we have stable funnels that we look with a positive mind. There is all the
reason to be positive about the demand environment and the volumes also. At the same time, there
are some question marks Teo mentioned. One of them is the currency rate. The other one is related
to the general development of the market environment overall. What we are trying to say with our
guidance is that we have a good starting point for the year, and we look at the volume development
positively, but being appropriately, let's say, cautious about it also in this environment.
00:32:39 - 00:33:12
Teo Ottola: Logically, you are right. If the sales were flat in a year-on-year comparison and the order
book for this year is 100 million more than what it was for last year, then it would mean that the in and
out volume would be lower, which could be, let's say, depending on various things. Now we need to
remember what we are saying regarding the overall market outlook is that the sales funnels in the
various businesses continue to be good, they continue to be stable and on a good level.
00:33:12 - 00:33:35
Antti Kansanen: Yes, that's clear. The second question was on profitability, and maybe a reminder on
the tariff-related pricing tailwinds that were kind of notable on previous quarter and still there in Q4.
How should we think about the impacts of those going forward? Maybe fading away. Any guidance on
that?
00:33:35 - 00:34:08
Marko Tulokas: They repeated also on quarter four after being visible in quarter three and quarter
two, but not to the same extent. As we have also said before, the expectation is that they will go away
or deteriorate over time, and of course, it actually continued throughout the whole year, and there was
a positive sign to us. We expect that you will not see a similar positive tailwind going forward, but it
should not have a significant negative impact on the margins either.
00:34:13 - 00:34:38
Antti Kansanen: Okay, that makes sense. The last question, and I guess, Marko, you all almost
started to answer on the capital allocation side. Obviously, there's a clear increase in the ordinary
dividend, but the balance sheet is getting stronger and stronger, and capital allocation has been a bit
of a discussion point. Any updates on further distribution, buybacks, or anything like that?
00:34:38 - 00:35:45
Marko Tulokas: Yes, I was so eager to start answering that question already, so I was pre-empting
that. Our approach has not changed that. We have several potential means for the use of that cash.
We are working on all of them. One of the obvious ones is the potential acquisitions. As we've said
before, that has been a big part of Konecranes' history, and it continues to be so in our future, also the
inorganic part of the growth. We have a funnel of different-sized opportunities that we are actively
exploring, and it's more of a timing question of when we can realize those. For that, for sure, we want
to have maneuvering room and the increase in the dividend that was announced today, of course,
that is our view in no way jeopardizing the maneuvering room that we have going forward, given the
available cash, and that, of course, our ability to leverage the company. Would you like to add
something to that?
00:35:46 - 00:35:46
Teo Ottola: No, thank you.
00:35:47 - 00:35:47
Marko Tulokas: Okay, good.
00:35:49 - 00:35:51
Antti Kansanen: All right. Thanks so much.
00:35:55 - 00:36:00
Operator: The next question comes from Mikael Doepel from Nordea. Please go ahead.
00:36:03 - 00:36:26
Mikael Doepel: Thank you. Good afternoon, everybody. Thanks for taking my questions. A couple of
them, I'll take them one by one. If we can start to talk a bit about the net of inflation pricing. I think you
mentioned it was positive still in Q4 of last year. How do you think about 2026? If we put tariffs aside,
how do you think about pricing net of inflation?
00:36:26 - 00:36:31
Marko Tulokas: Maybe since you were going through the bridge. You may want to continue on this
also.
00:36:31 - 00:37:19
Teo Ottola: Yes, the basic commentary here is the same as it has been. We believe that we will be
able to push cost inflation into the customer prices. Then, of course, the tariffs may change, and the
currency rates may change. But, if we take a look at the overall underlying inflation, the idea is that we
will be pushing that into the customer prices. In the past years, we have been able to do that in some
cases, maybe a little bit even more than the cost of inflation. We believe that we can balance the
situation from that point of view. However, maybe it is not a good idea to expect a continuous net of
inflation price benefit in '26 or further.
00:37:23 - 00:37:39
Mikael Doepel: Okay, that makes sense. Talking about cost and just to follow up, do you have any
meaningful cost efficiency measures ongoing now that could support margins into this year? Anything
tangible you could mention on that side?
00:37:39 - 00:38:49
Marko Tulokas: Maybe two things I will mention. First of all, the topic that we have discussed in the
past is the ongoing Industrial equipment cost efficiency program that we earlier announced that will
continue until the end of 2025. On that note, we can say that we are still continuing that, and we
expect that to continue to bring us additional benefits also during this year. The second answer to that
is that when it comes to adjusting our cost structure to the prevailing market conditions, that is what
we did early last year. Also, that in all accounts, whether it's the SG&A or the cost that we have on the
group level, or for example, in service, the costs that are directly related to customer projects. That is
business as usual for us, and that we've done in 2025, and we continue to do the same in '26 if the
market environment demand so requires. Beyond those two things, we don't have anything specific to
discuss right now.
00:38:51 - 00:39:18
Mikael Doepel: Okay, that's great. Then, finally, I think you mentioned in your opening remarks that
you talked about the Industrial Service business and said it was a bit of a tough environment within
that business. Let's talk a bit about what you see there specifically happening across the regions,
across the customer segments, and how you expect 2026 to develop.
00:39:41 - 00:40:09
Marko Tulokas: When we look at Industrial Service in general, if I start from just the market activity
how it looks, one thing that we've discussed earlier, and we also can measure is how our remote
connections what we call the TrueConnect product. How much activity the customer is having with our
cranes, which of course then means how much manufacturing or production activity there is. Those
productivity rates were down last year, the whole year. They also ended with a negative sign of
somewhere between six and seven percent compared to the previous year in terms of the general
use of the cranes. That's a fairly good proxy or explanation. Also, due to how our productivity in
service develops for those particular customers, and that has a correlation to how our service
business is actually developing.
00:40:33 - 00:41:07
Marko Tulokas: That tells more that there is in this sort of environment, where the customers have
uncertainty of which direction the world is going, they have the tendency to hold back on not urgent or
not critical measures they won’t do the things that have to be done to make sure the equipment is
productive and safe. That was a phenomena last year and had a certain impact to the service
business. It is obvious that you cannot do that for a very long time. Those equipment has to be taken
care of, so that is something that usually returns. The other positive aspect is that we kept on
increasing or improving our agreement base, which is essentially the growth engine for the service
and very important. That grew more than 4 percent, 4 and a half percent, last year, and that is what
we consider, and I consider very important, as a service core.
00:41:07 - 00:41:56
Marko Tulokas: Then, finally, I would say that, and sorry for the long answer, easy to get excited on
the topic. On the service side, there is a lot of positive demand drivers, like there is in the ports
demand side, in the long term. Whether it is the demographic trend of having less people doing this
sort of thing or the automation trend that is also prevailing in some of the segments there the
outsourcing that similarly to ports is actually prevalent in many of the industrial segments and many
others. That also in the long-term are drivers for Industrial Service and efficiency drivers too.
00:41:56 - 00:41:59
Teo Ottola: If I may add a little bit of additional color.
00:41:59 - 00:42:01
Marko Tulokas: I thought that I answered the whole thing already because that was very long.
00:42:01 - 00:43:23
Teo Ottola: That was very good, but I will maybe add one more thing. When we have previously been
saying that the differences between regions tend to be bigger than the differences between customer
segments in our demand. Now it may be that there start to be relatively big differences in demand
pictures between different customer segments, and there are maybe a couple of indications of that
one. One of them is that the thing that we have been discussing also earlier that for example, in North
America or in the US, there has been a little bit slowness on the service and equipment business. On
the other hand, has been maybe even surprisingly strong, which would in a way maybe indicate that
some of the segments are doing well and they are buying equipment and some others have maybe a
little bit more issues with the utilization, and they are maybe saving on non-essential service. Also, the
fact that our service spare parts are doing better than the field service may be an indication of the
same thing. Of course, the tariff thing, et cetera, can impact the spare part pricing and inflate it a little
bit, but that doesn't explain the whole thing. These changes may be there happening a little bit
because of defense and because of power, and those specifically, let's say buoyant segments
currently.
00:43:25 - 00:43:28
Mikael Doepel: Okay, that's super helpful. Thank you very much.
00:43:33 - 00:43:52
Operator: As a reminder, if you wish to ask a question, please dial pound key five on your telephone
keypad. There are no more questions at this time, so I hand the conference back to the speakers for
any closing comments.
00:43:53 - 00:44:11
Linda Häkkilä: Thank you everyone for following our webcast event today, and thank you for asking
such great questions. Konecranes will publish its Q1 results at the end of April. Until then, I want to
wish you all a very lovely springtime. Thank you.
00:44:11 - 00:44:11
Marko Tulokas: Thank you.
00:44:11 - 00:44:12
Teo Ottola: Thank you very much.
