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Cargotec's 2019 results highlights included significantly improved cash flow, an excellent year in Hiab and Kalmar, good development in services and a strong order book. But what are the hottest topics raised to our IR team? Here you can find the most Frequently Asked Questions about our financial statements and answers to them.

Why did Kalmar’s comparable EBIT margin decline by 214 bps when sales increased 6%?
Less favourable sales mix: slower demand and lower volumes in mobile equipment. The market demand has been softening slightly.

What is the expectation for 2020 comparable EBIT?
We expect the full year comparable operating profit for 2020 to increase from 2019 level (EUR 264 million).

What are the assumptions for the guidance?
Higher comparable operating profit in MacGregor, expected costs savings in MacGregor of 15 MEUR, growth in service business, cost savings in group level (9 MEUR). Market visibility is weak, especially for H2. We also estimate approximately 60 MEUR restructuring costs from ongoing programmes. Additional reviews have been started which could increase or decrease this estimate.

Why did EPS decline?
Net income and earnings per share decreased due to significant restructuring costs especially in MacGregor, as well as higher than average tax expense due to MacGregor’s negative business result, as recognition criteria for deferred tax assets were not fulfilled mainly in Germany and Norway.

The dividend proposal is above the target dividend range, why?
EPS was burdened by restructuring costs, and the dividend proposal is supported by strong cash flow. A significant part of the restructuring costs were non-cash based. Payout ratio excluding restructuring costs was 55%.

Can the coronavirus impact your business?
Coronavirus, or any other extraordinary public health emergency of international concern, could have direct or indirect impact on global trade as well as the demand and deliveries of Cargotec’s cargo handling solutions. At the moment, China is a relatively small part of Cargotec, and represents 5% (6% in 2018) of Cargotec sales in 2019 with about 600 employees there. However, if the situation gets worse it may have an impact on global supply chains.

Did you have many automation orders in Q4? Are you confident with automation potential?
In Q4, there was one sizable automation deal. It is difficult to forecast the exact timing of future deals, but the long term potential is there. Currently the activity level is relatively good and there are some interesting projects going on. Customers are not anymore considering whether to automate, but considering the timing.

What prompted the decision to start a strategic review of the future of Navis?
We are starting a strategic review and evaluating our options. To secure the best possible growth and value creation for the next development phase for Navis, we will review alternative development paths, including new ownership structures and a potential sale of Navis software business. Navis has an opportunity to develop its business into a direction that is less aligned with Cargotec’s core as its current business. Cargotec’s other software business will not be part of the evaluation.

What does reviewing the future of Navis mean for Cargotec’s strategy?
Our activities will continue to support our strategy and our transition from products to services and software. Our vision to become leaders in intelligent cargo handling is still valid.

Cargotec is a leading provider of cargo and load handling solutions with the goal of becoming the leader in intelligent cargo handling. Cargotec's business areas Kalmar, Hiab and MacGregor offer products and services that ensure our customers a continuous, reliable and sustainable performance.