Virus hits Cargotec
By Alex Dahm15 May 2020
Double digit rises and record profits make way for falling sales coronavirus Covid-19 impact strikes
In the first reporting period to reflect the impact of the coronavirus Covid-19, sales showed a small increase but the orders received figure was down 24 per cent.
Cargotec Group includes Hiab hydraulic loader cranes, Kalmar port cranes and MacGregor offshore cranes. Sales in the first quarter of 2020 were €858 million, against €856 million in the same period of 2019. Orders received, at €781 million, were down almost a quarter from €1,022 million in Q1 2019. Cargotec cited the coronavirus pandemic, increased uncertainty and pandemic-related government actions as having a negative impact, on orders, operations, supply chain and deliveries. That applied across all business areas.
Sales in the service division increased 5 % to €260 million from €249 million in the first quarter of 2019. Operating profit was €26 million or representing 3.1 % of sales, down almost 50 % from 51 million or 6.0 % of sales. An amount of €6 million was included for restructuring costs as it was in the same period a year earlier.
At the end of March Cargotec updated its outlook for 2020 which it had previously posted at the beginning of February. While it may be updated later in the year the position in early May was that, “In the current exceptional situation Cargotec estimated that it is not able to give a guidance for the year 2020.”
In the second quarter, the company said, “there are significant challenges in relation to deliveries and demand. Cargotec estimates a significant decline in orders, sales, comparable operating profit and cash flow in the second quarter compared to the second quarter of 2019. During the first weeks of April 2020, Cargotec’s orders received have significantly decreased from the comparison period. Due to the challenging operating environment, visibility towards the end of the year is currently weak.”