Konecranes Plc

Q2 comparable EBITA margin was 12.7%, down 1.6 percentage points year-on-year. Management said comparable sales declined 2.8% in comparable currencies, implying an underlying volume decline of about 5% or slightly more, while pricing was roughly 2% to 3% higher and broadly offset inflation. By business area, Service comparable EBITA margin was 21.2% (down 1.4 points), Industrial Equipment was 6.9% (up 0.6 points), and Port Solutions was 10.8% (down 1.9 points). Order intake grew 13% year-on-year in comparable currencies, and the order book reached EUR 3.4 billion, up 15% year-on-year. Free cash flow was negative in Q2, net working capital moved to the wrong side of the company’s target of below 10% of rolling 12-month sales, and the company said it was in a small net debt position at quarter-end. For the rest of the year, Konecranes reiterated guidance for net sales to remain approximately on the same level as last year or increase, and for comparable EBITA margin to remain approximately on the same level.

Marko Tulokas emphasized that customer activity stayed very strong despite geopolitical uncertainty, with especially good demand in Ports and in industrial segments like defense, power and aviation. He framed the quarter as one with solid execution and cost control in a softer volume environment, and highlighted the planned acquisition of a 70% majority stake in MFK in Japan as an important step for geographic expansion. His tone was constructive but cautious: the business environment is better than a few months ago, yet uncertainty from geopolitics and tariffs still weighs on timing and visibility.

Teo Ottola focused on the earnings bridge: the group’s comparable EBITA margin declined 1.6 percentage points to 12.7% because the volume drop flowed through to profit, while price increases of about 2% to 3% mostly covered inflation. He said the decline in comparable sales of 2.8% translated into an underlying volume decline of about 5% or more, and noted that mix was not material, while execution was only a small negative. On cash, he said net working capital moved above the company’s target for the first time in 2 years because of inventories and work in progress, which hurt free cash flow; cash conversion was close to 100% on a rolling 12-month basis, and the quarter ended in small net debt after the dividend payment. He also pointed out a little less than EUR 2 million of U.S. tariff refund benefit in Port Solutions.

Analysts pressed on why Service margins fell despite more parts and field service growth, and management said the mix effect was small and not enough to move margins materially; the real issue was lower volume and slower invoicing from the agreement base. They also asked why free cash flow was weak despite large late-quarter orders, and management said the timing of those orders meant advances had not yet come through in the quarter. On the guidance, management said the second half should benefit from an order book that is roughly EUR 200 million higher than a year ago, but they remained cautious because delivery timing and customer behavior in Service are still somewhat uncertain. They also said pricing should generally cover inflation, but they do not expect automatic net pricing gains, and any new cost shocks could create temporary pressure.