Contents
2022 highlights
Report of the Board of Directors
Konecranes Group 2018–2022
Calculation of key figures
Financial Statements
Consolidated statement of income – IFRS
Consolidated balance sheet – IFRS
Consolidated statement of changes in equity – IFRS
Consolidated cash flow statement – IFRS
Notes to the consolidated financial statements
Company list
Parent company statement of income – FAS
Parent company balance sheet – FAS
Parent company cash flow – FAS
Notes to the parent company’s Financial Statement
Board of Directors’ proposal to the Annual General Meeting
Auditor’s report
Independent Auditor’s Report on Konecranes Plc’s
ESEF Consolidated Financial Statements
Company information for ESEF reporting
Shares and shareholders
34
36
58
59
61
62
63
64
65
112
114
115
116
117
119
120
124
125
126
FINANCIAL REVIEW 2022
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FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
2022 highlights
Sales & order intake, MEUR
Adjusted EBITA by Segment, 2022
Adjusted EBITA, MEUR & Adjusted EBITA margin, %
Personnel by Segment, 2022
Earnings & dividend per share, EUR
72%
Service
249.4 MEUR
18%
Port Solutions
63.5 MEUR
9%
Industrial Equpment
32.5 MEUR
47%
Service
7,802
19%
Port Solutions
3,102
34%
Industrial Equpment
5,529
2018 2019 2020 2021 2022
Sales Order intake
0
1,000
2,000
3,000
4,000
3,185.7
3,175.5
3,364.8
3,928.9
3,178.9
2,727.3
3,156.1
3,090.3
3,326.9
3,167.3
38%
Service
1,343.3 MEUR
28%
Port Solutions
1,015.0 MEUR
34%
Industrial Equpment
1,205.6 MEUR
Sales by Business Area, 2020
0
50
100
150
200
250
300
350
Adjusted EBITA, MEUR/ Adjusted EBITA margin, %
2018 2019 2020 2021 2022
Adjusted EBITA
Adjusted EBITA margin
2
4
6
8
10
12
14
16
312.2
318.4
260.8
257.1
275.1
0.0
0.5
1.0
1.5
2.0
Earnings & dividend per share, EUR
2018 2019 2020 2021 2022
Earnings per share, basic Dividend per share
1.29
1.20
1.03
1.20
1.86
1.77
1.25 1.25
*
1.54
0.88
*The Board's proposal to the AGM
Sales by Segment, 2022
Percentages have been rounded and may not total to 100%.
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FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Return on equity, %
Order book, MEUR
ROCE, % & Adjusted ROCE, %
Year-end net working capital, MEUR
Year-end market capitalization*, MEUR
Year-end net debt, MEUR & Gearing, %
0
100
200
300
400
500
600
2018 2019 2020 2021 2022
410.4
446.0
424.5
581.2
337.2
0
200
400
600
800
1,000
2018 2019 2020 2021 2022
Net debt
545.3
655.3
577.1
541.6
688.3
100
80
60
40
20
Gearing
0
3
6
9
12
15
2018 2019 2020 2021 2022
Return on capital employed, %
Adjusted return on capital employed, %
7.9
12.5
6.3
8.3
12.7
11.1
9.3
13.4
9.0
13.4
0
500
1,000
1,500
2,000
2,500
3,000
2018 2019 2020 2021 2022
1,715.4
1,824.3
2,036.8
2,901.7
1,715.5
0
2
4
6
8
10
12
2018 2019 2020 2021 2022
7.7
6.5
9.8
11.3
9.9
0
500
1,000
1,500
2,000
2,500
3,000
2018 2019 2020 2021 2022
2,080.0
2,160.2
2,277.5
2,782.4
2,276.8
* Excluding treasury shares
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FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Report of the Board of Directors
Unless otherwise stated, the figures in brackets in the
sections below refer to the same period in the previous year.
Market review
In 2022, the global manufacturing sector was negatively
impacted by high inflation, economic uncertainty and supply
chain constraints. In addition, the war in Ukraine increased
energy costs and market volatility particularly in Europe.
The world’s manufacturing sector’s operating conditions,
according to the global manufacturing Purchasing Managers’
Index (PMI), were in contraction at the end of the fourth
quarter of 2022. Before turning to deterioration below
the neutral 50 mark in September, the PMI had been in
expansion territory for more than two years. December’s
PMI of 48.6 was the lowest reading since mid-2020, and
excluding the lows seen in the beginning of the COVID-19
pandemic, it was the lowest level since the first half of 2009.
In the eurozone, December’s manufacturing PMI was
in deterioration with a reading of 47.8. It was the sixth
successive month in contraction although the PMI
slightly improved from November. In the US, December’s
manufacturing PMI was in contraction with a reading of
46.2. The PMI fell below the neutral 50 mark in November
and December’s level was among the lowest readings since
2009. In the emerging markets, December’s manufacturing
PMI was in expansion territory in India while in Brazil and
China, the PMI was in deterioration.
The manufacturing industry capacity utilization rate in the
European Union decreased in the fourth quarter. The capacity
utilization rate was at a lower level on a year-on-year
basis, it dropped back to approximately the same readings
registered prior to the start of the COVID-19 pandemic. The
manufacturing industry capacity utilization rate in the US
decreased in December. The capacity utilization rate was at
a lower level on a year-on-year basis, it returned below the
recent highs recorded earlier during 2022.
Global container throughput, according to the RWI/ISL
Container Throughput Index, began 2022 at a relatively
strong level compared to the historical readings. At the end
of 2022, the global container throughput was approximately
on the same level as the year before, although there was
some fluctuation during the year.
Regarding raw material prices, at the end of the fourth
quarter both steel and copper prices were below the
previous year’s levels. The average EUR/USD exchange
rate was approximately 11 percent lower compared to the
year-ago period.
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FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Orders received
In full year 2022, orders received totaled EUR 3,928.9
million (3,175.5), representing an increase of 23.7 percent.
On a comparable currency basis, order intake increased
19.2 percent. Orders received increased in the Americas,
EMEA and APAC.
In Service, order intake increased 7.8 percent on a
reported basis and 1.5 percent on a comparable currency
basis. In Industrial Equipment, orders received increased
18.5 percent on a reported basis and 13.3 percent on a
comparable currency basis. External orders received in
Industrial Equipment increased 15.3 percent on a reported
basis and 9.9 percent on a comparable currency basis. In
Port Solutions, order intake increased 47.3 percent on a
reported basis and 46.8 percent on a comparable currency
basis.
Order book
At the end of December, the value of the order book
totaled EUR 2,901.7 million (2,036.8), which was
42.5 percent higher compared to previous year. On a
comparable currency basis, the order book increased 41.1
percent. The order book increased 29.7 percent in Service,
20.8 percent in Industrial Equipment and 62.6 percent in
Port Solutions.
Sales
In full year 2022, Group sales totaled EUR 3,364.8 million
(3,185.7), representing an increase of 5.6 percent. On a
comparable currency basis, sales increased 1.8 percent.
Sales increased 11.5 percent in Service and 10.7 percent
in Industrial Equipment but decreased 5.4 percent in Port
Solutions. Industrial Equipment’s external sales increased
11.3 percent.
At the end of December, the regional breakdown of sales,
calculated on a rolling 12-month basis, was as follows: EMEA
51 (52), Americas 36 (33) and APAC 13 (16) percent.
Financial result
In full year 2022, the Group adjusted EBITA increased to EUR
318.4 million (312.2). The adjusted EBITA margin decreased
to 9.5 percent (9.8). The adjusted EBITA margin increased
in Service to 18.6 percent (18.5) but decreased in Industrial
Equipment to 2.7 percent (3.5) and in Port Solutions to 6.3
percent (7.4). The decrease in the Group adjusted EBITA
margin was mainly attributable to lower underlying sales
volumes and cost inflation primarily in Industrial Equipment.
In full year 2022, the consolidated adjusted operating
profit increased to EUR 286.6 million (279.1). The adjusted
operating margin decreased to 8.5 percent (8.8).
In full year 2022, the consolidated operating profit totaled
EUR 223.2 million (220.0). The operating profit includes
adjustments of EUR 63.5 million (59.1), which mainly
comprised of costs related to the impacts of the war in
Ukraine, merger related costs, and restructuring costs. Year-
on-year, the operating margin increased in Service to 17.3
percent (17.0) and decreased in Industrial Equipment to
-0.9 percent (1.7) and in Port Solutions to 3.8 percent (7.0).
In full year 2022, depreciation and impairments totaled EUR
124.4 million (120.1). The impact arising from the purchase
price allocation amortizations and goodwill impairments
represented EUR 31.8 million (33.2) of the depreciation and
impairments. In Q3 2022, EUR 3.9 million of goodwill in the
Agilon business was impaired.
In full year 2022, the share of the result in associated
companies and joint ventures was EUR 0.4 million (0.3).
In full year 2022, financial income and expenses totaled
EUR -32.9 million (-27.8). Net interest expenses accounted
for EUR 26.1 million (15.7) of the sum and the remainder
was mainly attributable to other financing expenses.
In full year 2022, profit before taxes was EUR 190.7 million
(192.5).
In full year 2022, income tax was EUR 52.2 million (45.1).
The Group’s effective tax rate was 27.4 percent (23.4).
10–12/2022 10–12/2021 Change %
Change % at
comparable
currency rates 1–12/2022 1–12/2021 Change %
Change % at
comparable
currency rates
Orders received, MEUR 879.1 892.3 -1.5 -4.5 3,928.9 3,175.5 23.7 19.2
Net sales, MEUR 1,020.9 948.9 7.6 4.4 3,364.8 3,185.7 5.6 1.8
Orders received and net sales
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CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
In full year 2022, net profit was EUR 138.5 million (147.4).
In full year 2022, the basic earnings per share were EUR
1.77 (1.86) and the diluted earnings per share were EUR
1.77 (1.85).
On a rolling 12-month basis, the return on capital employed
was 9.0 percent (9.3) and the return on equity 9.9 percent
(11.3). The adjusted return on capital employed was 13.4
percent (13.4).
Balance sheet
At the end of December, the consolidated balance sheet
amounted to EUR 4,340.6 million (3,845.8). The total equity
at the end of the reporting period was EUR 1,433.0 million
(1,360.6). The total equity attributable to the equity holders
of the parent company was EUR 1,432.9 million (1,351.4) or
EUR 18.10 per share (17.08).
Net working capital totaled EUR 581.2 million (424.5). The
increase in net working capital resulted mainly from an
increase in inventories. Sequentially, net working capital
increased by EUR 2.7 million.
Cash flow and financing
In full year 2022, net cash from operating activities was EUR
66.7 million (168.4). The decrease in net cash from operating
activities was mainly due to change in net working capital
during the period. Cash flow before financing activities was
EUR 23.1 million (137.7), which included cash inflows of
EUR 2.6 million (9.8) related to sale of property, plant and
equipment, and EUR 0.1 million (0.0) related to divestment of
Businesses. It included cash outflows of EUR 1.6 million (0.0)
related to acquisition of Group companies, and EUR 44.7
million (40.5) related to capital expenditure.
At the end of December, interest-bearing net debt was EUR
688.3 million (541.6). Net debt increased mainly due to
weaker operating cash flow. The equity to asset ratio was
37.9 percent (38.9) and gearing 48.0 percent (39.8).
At the end of December, cash and cash equivalents
amounted to EUR 413.9 million (320.7). None of the Group’s
committed EUR 400 million back-up financing facility was in
use at the end of the period.
In June 2022, Konecranes paid dividends, amounting to EUR
98.9 million or EUR 1.25 per share, to its shareholders.
Capital expenditure
In full year 2022, capital expenditure excluding acquisitions
and joint arrangements amounted to EUR 37.0 million
(49.8). The amount consisted mainly of investments in
machinery and equipment, buildings, office equipment and
information technology.
Acquisitions and divestments
In full year 2022, the cash impact of capital expenditure for
acquisitions and joint arrangements was EUR -1.6 million
(0.0). The cash impact of divestment of Businesses was
EUR 0.1 million (0.0).
In July 2022, Konecranes acquired a small crane service
business of Garabi Industrial Technologies in Spain. In
September 2022, Konecranes acquired the non-controlling
interest of 6 percent of Konecranes Real Estate GmbH & Co.
KG in Germany. In November 2022, Konecranes became
the sole owner and provider of TBA software products by
acquiring the non-controlling interest of 30.22 percent of
Ports Software Solutions B.V. in the Netherlands.
In September 2022, Konecranes divested the small
automation business Motronica in Italy from the Port
Solutions segment. In September-December 2022,
Konecranes divested the service business in Russia to local
management who have established their own companies.
Personnel
In full year 2022, the Group had an average of 16,563
employees (16,625). On December 31, the number of
personnel was 16,522 (16,573). In full year 2022, the
Group’s personnel decreased by 51 people net.
At the end of December, the number of personnel by
operating segment was as follows: Service 7,802 employees
(7,890), Industrial Equipment 5,529 employees (5,516),
Port Solutions 3,102 employees (3,083) and Group staff 89
employees (84).
The Group had 9,565 (9,683) employees working in EMEA,
3,131 (3,016) in the Americas and 3,826 (3,874) in APAC.
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CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
In full year 2022, orders received totaled EUR 1,161.9
million (1,078.3), corresponding to an increase of 7.8
percent. On a comparable currency basis, orders received
increased 1.5 percent.
The order book increased 29.7 percent to EUR 445.5 million
(343.5). On a comparable currency basis, the order book
increased 26.0 percent.
The annual value of the agreement base increased 5.7
percent year-on-year to EUR 306.9 million (290.4). On
a comparable currency basis, the annual value of the
10–12/2022 10–12/2021 Change %
Change % at
comparable
currency rates 1–12/2022 1–12/2021 Change %
Change % at
comparable
currency rates
Orders received, MEUR 283.2 307.7 -7.9 -13.7 1,161.9 1,078.3 7.8 1.5
Order book, MEUR 445.5 343.5 29.7 26.0 445.5 343.5 29.7 26.0
Agreement base value, MEUR 306.9 290.4 5.7 3.4 306.9 290.4 5.7 3.4
Net sales, MEUR 376.0 332.2 13.2 7.7 1,343.3 1,205.3 11.5 5.4
Adjusted EBITA, MEUR
1
79.3 69.7 13.9 249.4 222.4 12.2
Adjusted EBITA, %
1
21.1% 21.0% 18.6% 18.5%
Purchase price allocation amortization, MEUR -3.6 -3.9 -7.1 -14.3 -15.5 -8.1
Adjustments, MEUR -0.8 -1.0 -2.9 -2.0
Operating profit (EBIT), MEUR 74.9 64.8 15.6 232.3 204.9 13.4
Operating profit (EBIT), % 19.9% 19.5% 17.3% 17.0%
Personnel at the end of period 7,802 7,890 -1.1 7,802 7,890 -1.1
Segments
Service
agreement base increased 3.4 percent. Sequentially,
the annual value of the agreement base decreased 2.7
percent on a reported basis and increased 1.2 percent on a
comparable currency basis.
Sales increased 11.5 percent to EUR 1,343.3 million
(1,205.3). On a comparable currency basis, sales increased
5.4 percent. Both field service sales and parts sales
increased.
The adjusted EBITA was EUR 249.4 million (222.4) and
the adjusted EBITA margin was 18.6 percent (18.5).
The increase in the adjusted EBITA margin was mainly
attributable to higher sales driven by pricing. The operating
profit was EUR 232.3 million (204.9) and the operating
margin 17.3 percent (17.0).
1
Excluding adjustments and purchase price allocation amortization. See also note 3 in the notes to the consolidated financial statements.
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FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
10–12/2022 10–12/2021 Change %
Change % at
comparable
currency rates 1–12/2022 1–12/2021 Change %
Change % at
comparable
currency rates
Orders received, MEUR 306.2 274.5 11.6 7.8 1,389.2 1,172.5 18.5 13.3
of which external, MEUR 258.6 242.4 6.7 2.9 1,192.4 1,033.7 15.3 9.9
Order book, MEUR 857.2 709.9 20.8 18.3 857.2 709.9 20.8 18.3
Net sales, MEUR 376.9 332.1 13.5 9.2 1,205.6 1,088.7 10.7 5.9
of which external, MEUR 335.1 294.1 13.9 9.2 1,068.8 960.2 11.3 6.0
Adjusted EBITA, MEUR
1
22.5 20.6 9.3 32.5 38.0 -14.4
Adjusted EBITA, %
1
6.0% 6.2% 2.7% 3.5%
Purchase price allocation amortization, MEUR -1.8 -2.7 -34.3 -11.0 -10.8 1.4
Adjustments, MEUR -9.7 -1.1 -32.5 -8.5
Operating profit (EBIT), MEUR 11.0 16.8 -34.2 -10.9 18.7 -158.6
Operating profit (EBIT), % 2.9% 5.0% -0.9% 1.7%
Personnel at the end of period 5,529 5,516 0.2 5,529 5,516 0.2
In full year 2022, orders received totaled EUR 1,389.2
million (1,172.5), corresponding to an increase of 18.5
percent. On a comparable currency basis, orders received
increased 13.3 percent. External orders received increased
15.3 percent on a reported basis and 9.9 percent on a
comparable currency basis. Order intake increased in
standard cranes, process cranes and components.
The order book increased 20.8 percent to EUR 857.2 million
(709.9). On a comparable currency basis, the order book
increased 18.3 percent.
Sales increased 10.7 percent to EUR 1,205.6 million
(1,088.7). On a comparable currency basis, sales increased
5.9 percent. External sales increased 11.3 percent on a
reported basis and 6.0 percent on a comparable currency
basis. Sales increased in standard cranes, process cranes
and components.
The adjusted EBITA was EUR 32.5 million (38.0) and the
adjusted EBITA margin 2.7 percent (3.5). The decrease in
the adjusted EBITA margin was mainly attributable to cost
inflation and low underlying sales volumes. The operating
profit was EUR -10.9 million (18.7) and the operating
margin -0.9 percent (1.7).
Industrial Equipment
1
Excluding adjustments and purchase price allocation amortization. See also note 3 in the notes to the consolidated financial statements.
40
FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
10–12/2022 10–12/2021 Change %
Change % at
comparable
currency rates 1–12/2022 1–12/2021 Change %
Change % at
comparable
currency rates
Orders received, MEUR 355.7 354.9 0.2 0.4 1,639.5 1,112.7 47.3 46.8
Order book, MEUR 1,599.0 983.5 62.6 63.5 1,599.0 983.5 62.6 63.5
Net sales, MEUR 328.4 337.9 -2.8 -2.6 1,015.0 1,072.9 -5.4 -6.0
of which service, MEUR 64.7 50.9 27.1 23.0 226.1 181.9 24.3 20.4
Adjusted EBITA, MEUR
1
21.4 28.8 -25.7 63.5 79.9 -20.5
Adjusted EBITA, %
1
6.5% 8.5% 6.3% 7.4%
Purchase price allocation amortization, MEUR -1.6 -1.6 -0.1 -6.6 -6.8 -3.6
Adjustments, MEUR 2.9 1.4 -18.6 1.7
Operating profit (EBIT), MEUR 22.6 28.5 -20.7 38.4 74.8 -48.7
Operating profit (EBIT), % 6.9% 8.4% 3.8% 7.0%
Personnel at the end of period 3,102 3,083 0.6 3,102 3,083 0.6
1
Excluding adjustments and purchase price allocation amortization. See also note 3 in the notes to the consolidated financial statements.
In full year 2022, orders received totaled EUR 1,639.5
million (1,112.7), corresponding to an increase of 47.3
percent. On a comparable currency basis, orders received
increased 46.8 percent.
The order book increased 62.6 percent to EUR 1,599.0
million (983.5). On a comparable currency basis, the order
book increased 63.5 percent.
Sales decreased 5,4 percent to EUR 1,015.0 million
(1,072.9). On a comparable currency basis, sales decreased
6.0 percent.
The adjusted EBITA was EUR 63.5 million (79.9) and the
adjusted EBITA margin 6.3 percent (7.4). The decrease in
the adjusted EBITA margin was mainly attributable to lower
sales due to timing of customer deliveries. In addition, the
Port Solutions
comparison period included a provision release of EUR 5
million. Gross margin increased on a year-on-year basis.
Operating profit was EUR 38.4 million (74.8) and the
operating margin 3.8 percent (7.0).
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FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Group overheads
In full year 2022, the adjusted unallocated Group overhead
costs and eliminations were EUR 27.0 million (28.1),
representing 0.8 percent of sales (0.9).
The unallocated Group overhead costs and eliminations
were EUR 36.6 million (78.4), representing 1.1 percent of
sales (2.5). These included adjustments of EUR 9.5 million
(50.3), consisting mainly of merger related costs.
The impact of the war in Ukraine on
Konecranes
Konecranes operates a crane and component factory in
Zaporizhzhia, in the south-eastern part of Ukraine. The
factory is one of the Industrial Equipment supply factories
for crane components and a crane manufacturing unit
for Eastern Europe deliveries. It also offers extra capacity
for Konecranes’ western crane deliveries specializing in
large steel structures. The factory has approximately 350
employees.
In addition, Konecranes has approximately 70 people
working in crane service, port service, spare parts, and
industrial crane sales operations mainly in Odessa, Mariupol
and Zaporizhzhia.
Konecranes has supported its employees and their families
based in Ukraine throughout the war and has continued to
pay salaries and wages to the Ukrainian employees. The
safety and well-being of Konecranes’ employees based in
Ukraine, and their families, are a number one priority for
Konecranes.
The production at the Ukrainian factory was stopped
immediately after the war started. The planned production
has been redirected to other Konecranes manufacturing
sites. This has generated additional operating costs mainly
within Industrial Equipment. In full year 2022, these costs
totaled approximately EUR 4 million.
As the level of uncertainty regarding Konecranes’ operations
in Ukraine remains high due to the ongoing war, Konecranes
impaired all Ukraine-related assets, including inventories
and receivables, in the first quarter. The impact of the
impairments on operating profit was approximately EUR 4.0
million negative in January-December.
Konecranes condemns Russia’s aggression towards
Ukraine and has decided not to take any new business
from Russia. As a result of this decision, Konecranes
wrote off EUR 78.9 million of orders from Russian the
first quarter. In total, in 2022, the Russia-related sales
reversals totaled EUR 33.5 million, out of which EUR 21.2
million in Port Solutions and EUR 12.3 million in Industrial
Equipment. The negative result impact of Russia-related
actions totaled EUR 37.8 million, out of which EUR 17.8
million in Port Solutions, EUR 19.6 million in Industrial
Equipment, EUR 0.4 million in Service and EUR 0.1 million
unallocated items. These amounts have been included in
adjustments.
In the fourth quarter, Konecranes divested its Russian Service
business to local management who had established their own
companies. Konecranes cancelled all Russian maintenance
agreements already in the third quarter, and they were
written off from the Konecranes service agreement base, with
a EUR 3.5 million negative impact on the agreement base
value.
At the end of December, Konecranes’ order book included
EUR 0.3 million of orders from Russia.
The war has increased market volatility and uncertainty
by increasing cost inflation and global material availability
concerns and other supply chain issues. It is too early to
estimate how long and to what extent they will impact
Konecranes’ business and performance.
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Administration
Abandonment of the planned merger of
Konecranes Plc and Cargotec Corporation
On October 1, 2020, Konecranes Plc (“Konecranes”) and
Cargotec Corporation (“Cargotec”) announced that their
respective Boards of Directors had signed a combination
agreement and a merger plan (“the Merger Plan”) to
combine the two companies through a merger (“the
Merger”).
On March 29, 2022, Konecranes announced that the UK
Competition & Markets Authority (“CMA”) had blocked the
merger. According to the CMA’s final report issued on the
same day, the remedies – which had been accepted by the
European Commission (“EC”) – would not be effective in
addressing the CMA’s concerns and thus the planned merger
between Konecranes and Cargotec could not be completed.
The completion of the planned merger would have required
approvals from all relevant competition authorities. Thus,
Konecranes and Cargotec decided to cancel the planned
merger and immediately ceased the pursuit of the merger
and the related processes and continue to operate
separately as fully independent companies.
Service and Industrial Equipment under one
leadership
On April 27, 2022, Konecranes announced that as a result
of the Industrial Assessment, which was started in October
2021, it had decided to focus Service and Industrial
Equipment under one leadership to strengthen Konecranes’
role as the global lifting leader. As a result, since the
beginning of June, Konecranes has had two Business Areas:
Industrial Service and Equipment, and Port Solutions.
Despite the change, Konecranes continues to report three
operating segments: Service, Industrial Equipment and Port
Solutions, and the segment financials are comparable with
historical figures.
Decisions of the Annual General Meeting
The Annual General Meeting of Konecranes Plc
(“Konecranes” or the “Company”) was held on June 15,
2022. The meeting approved the Company’s annual
accounts for the fiscal year 2021, discharged the members
of the Board and the CEO from liability, and approved
all proposals made by the Board and its committees
to the AGM.
The AGM approved the Board’s proposal that a dividend of
EUR 1.25 per share is paid. The dividend was paid on
June 28, 2022.
The AGM decided to approve the Konecranes Remuneration
Report. The resolution on the report is advisory.
The AGM confirmed that the annual remuneration for the
Board of Directors and the meeting fee for the committees
remain unchanged, in addition to which a meeting fee for
meetings of the Board of Directors was introduced.
The AGM approved the Shareholders’ Nomination Board’s
proposals: the number of members of the Board is ten, the
election of members of the Board according to the proposal,
and the election of Christoph Vitzthum as Chairman and
Pasi Laine as Vice Chairman of the Board.
The AGM decided to re-elect Ernst & Young Oy as the
Company’s auditor. The remuneration will be paid according
to an invoice approved by the Company.
The AGM authorized the Board to decide on the repurchase
and/or on the acceptance as pledge of the Company’s own
shares.
The AGM authorized the Board to decide on the issuance
of shares as well as the issuance of special rights entitling
to shares.
The AGM authorized the Board to decide on the transfer of
the Company’s own shares.
The AGM authorized the Board to decide on a directed
issuance of shares without payment for the Employee Share
Savings Plan.
The AGM authorized the Board to decide on donations.
The resolutions of the AGM have been published in the
stock exchange release dated June 15, 2022.
Board of Directors
The Board of Directors elected in the Annual General
Meeting 2022 consists of
• Christoph Vitzthum, Chairman of the Board
• Pasi Laine, Vice Chairman of the Board
• Pauli Anttila, Member of the Board
• Janina Kugel, Member of the Board
• Ulf Liljedahl, Member of the Board
• Niko Mokkila, Member of the Board
• Per Vegard Nerseth, Member of the Board
• Päivi Rekonen, Member of the Board
• Helene Svahn, Member of the Board
• Sami Piittisjärvi, Member of the Board
The term of office ends at the closing of the Annual General
Meeting in 2023.
On June 15, 2022, Konecranes announced that the
Board had held its first meeting. The Board decided to
continue with an Audit Committee and a Human Resources
Committee.
Ulf Liljedahl was elected Chairman of the Audit Committee,
and Niko Mokkila and Päivi Rekonen as Committee
members. Janina Kugel was elected Chairwoman of the
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Human Resources Committee, and Per Vegard Nerseth and
Christoph Vitzthum as Committee members.
All Board members with the exception of Sami Piittisjärvi are
deemed to be independent of the Company and all Board
members with the exception of Niko Mokkila and Pauli
Anttila are deemed to be independent of the Company’s
significant shareholders.
Sami Piittisjärvi is deemed not to be independent of the
Company due to his current position as an employee of
Konecranes. Niko Mokkila is deemed not to be independent
of a significant shareholder of the Company based on his
current position as Managing Director at Hartwall Capital
Oy Ab. Pauli Anttila is deemed not to be independent of
a significant shareholder of the Company based on his
current position as Investment Director and Member of the
Management Team at Solidium Oy.
Konecranes Leadership Team
In full year 2022, Konecranes Leadership Team consisted of
• Anders Svensson, President and CEO (since October 19,
2022)
• Teo Ottola, CFO, Deputy CEO (also interim CEO until
October 18, 2022)
• Fabio Fiorino, Executive Vice President, Industrial Service
and Equipment (until May 31, 2022, Executive Vice
President, Service)
• Carolin Paulus, Executive Vice President, Industrial
Equipment (until May 31, 2022)
• Mika Mahlberg, Executive Vice President, Port Solutions
• Juha Pankakoski, Executive Vice President, Technologies
• Anneli Karkovirta, Senior Vice President, People and
Culture
• Sirpa Poitsalo, Senior Vice President, General Counsel
• Topi Tiitola, Senior Vice President, Integration and Project
Management Office
Shareholders’ Nomination Board
On September 20, 2022, Konecranes announced the
composition of the Shareholders’ Nomination Board. The
Shareholders’ Nomination Board is comprised of one
member appointed by each of the four largest shareholders
of Konecranes Plc. The Nomination Board consists of:
• Reima Rytsölä, CEO of Solidium, appointed by Solidium Oy,
• Peter Therman, Deputy Chairman of the Board of
Directors of Hartwall Capital, appointed by HC Holding
Oy Ab,
• Mikko Mursula, Deputy CEO, Investments of Ilmarinen,
appointed by Ilmarinen Mutual Pension Insurance
Company, and
• Stig Gustavson, appointed by Stig Gustavson and family.
In addition, Christoph Vitzthum, the Chairman of the Board
of Directors, serves as an expert in the Nomination Board
without being a member.
On December 22, 2022, Konecranes announced that
the Shareholders’ Nomination Board had submitted its
proposals for the 2023 Annual General Meeting to the
Board of Directors. The proposals were published in a stock
exchange release on the same day.
Shares and trading
Share capital and shares
On December 31, 2022, the Company’s registered share
capital totaled EUR 30.1 million. On December 31, 2022,
the number of shares including treasury shares totaled
79,221,906.
Treasury shares
On December 31, 2022, Konecranes Plc was in possession
of 55,307 treasury shares, which corresponds to 0.1 percent
of the total number of shares, and which had on that date a
market value of EUR 1.6 million.
On June 20, 2022, 32,140 treasury shares were conveyed
without consideration to the key employees as a reward
payment for the Konecranes Restricted Share Unit Plan 2017.
Market capitalization and trading volume
The closing price for the Konecranes shares on the Nasdaq
Helsinki on December 30, 2022, was EUR 28.76. The volume-
weighted average share price in full year 2022 was EUR
27.14, the highest price being EUR 38.43 in January and
the lowest EUR 19.61 in September. In full year 2022, the
trading volume on the Nasdaq Helsinki totaled 63.7 million,
corresponding to a turnover of approximately EUR 1,729.3
million. The average daily trading volume was 251,844 shares
representing an average daily turnover of EUR 6.8 million.
On December 31, 2022, the total market capitalization of
Konecranes Plc was EUR 2,278.4 million including treasury
shares. The market capitalization was EUR 2,276.8 million
excluding treasury shares.
Performance Share Plans 2020, 2021 and 2022
On February 3, 2022, Konecranes announced that Board of
Directors had resolved adjusted earnings per Share (EPS)
as the criterion for 2022, which is the third measurement
period of the Performance Share Plan 2020 and the second
measurement period of the Performance Share Plan 2021.
Adjustments to the EPS include defined restructuring costs,
mergers and acquisitions related deal costs and other
unusual items.
Additional information, including essential terms and
conditions of the Plan 2020 are available in a stock
exchange release published on July 23, 2020, and those
of the Plan 2021 in a stock exchange release published on
February 3, 2021.
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On March 30, 2022, Konecranes announced that the Board of
Directors had resolved to establish a new Performance Share
Plan 2022. The Plan has a performance period from 2022 to
2024 with three separate measurement periods and separate
targets for 2022, 2023 and 2024.
The criterion for the measurement period 2022 is adjusted
earnings per Share (EPS). The EPS target for the first
measurement period was also resolved by the Board of
Directors.
The target group of the Plan for the performance period
2022–2024 consists of a maximum of 170 key employees of
the Konecranes group.
Additional information, including essential terms and
conditions of the Plan, is available in the stock exchange
release dated March 30, 2022.
Employee Share Savings Plan
On March 30, 2022, Konecranes announced that the Board of
Directors had decided to launch a new Plan Period relating to
the Employee Share Savings Plan. The new Plan Period began
on August 1, 2022, and will end on June 30, 2023. The other
terms and conditions of the Plan Period 2022–2023 approved
by the Board on March 30, 2022, have been published in the
stock exchange release on the same day.
Notifications of major shareholdings
In full year 2022, Konecranes received the following
notifications of major shareholdings.
Research and development
In 2022, Konecranes’ research and product development
expenditure totaled EUR 47.7 (47.7) million, representing
1.4 (1.5) percent of sales. R&D expenditure includes
product development projects aimed at improving the
quality and cost efficiency of both products and services.
Technological leadership forms a foundation for Konecranes’
competitiveness and positive impact. Through innovation,
new solutions and ways of working, Konecranes supports
customers’ operations and boosts sustainability in the lifting
and material handling industries.
Konecranes’ offering is based on Core of Lifting hardware
and software componentry. These central components have
been designed and constructed for the specific purpose
of lifting, enabling optimal performance and sustainability
as well as maximized lifetime. The componentry is well-
designed to meet the Industry 4.0 transition, and integrates
with Konecranes’ digitized and automated offering.
Konecranes’ research and development efforts are focused
around creating tangible customer benefits, improved
business operations and a positive impact. Around half of
all Konecranes’ research and development is directed to
environmental topics.
Konecranes develops new solutions both internally and in
cooperation with others. In 2022, Konecranes participated
in DIMECC’s InDEx program, focusing on the data economy
and communication between equipment in factory settings.
The crane has a critical role in manufacturing and big
potential as a central piece of a smart factory, coordinating
communication between equipment as well as gathering
data critical for improving operations. High-quality data is
also crucial for Konecranes’ industry-leading service offering,
supporting timely maintenance. This minimizes equipment
downtime, lengthens its lifecycle, and supports the proper
identification of defects, a crucial part of equipment safety.
The development in electronics and automation has
allowed Konecranes to expand its offering of smart features
more widely, now available for standard and configurable
cranes as well. Tapping into the increased digitalization of
solutions, combined with growing eco-offering as evident
in 2022 in the addition of battery power options to RTGs
and straddle carriers, ensures that Konecranes maintains its
technological edge.
The ability to provide customers with the latest solutions
enhancing safety, sustainability and productivity strengthens
Konecranes’ position as the provider of choice and ability to
push the industry forward.
In innovation efforts, Konecranes also utilizes the agility of
startups both as partners and through methods associated
with them. The collaboration is mutually beneficial, with
Konecranes benefitting from the agile, leading startups
in their field and with the startups getting access to an
industry-leading company and possible references. The
collaboration is also always commercial, with Konecranes
paying for the projects. Konecranes utilizes experience to
support the collaboration between corporations and startups
at large, for instance by publishing a publicly available
guidebook in 2022 on fruitful cooperation.
Konecranes’ REACH program, an invitation to collaboration
with startups based on predefined themes, ran also in 2022.
Accelerator, our internal program inspiring Konecranes
people to take on board the best practices from startups
in their own ways of working was also arranged in 2022. A
Date Shareholder Threshold
% of shares
and voting
rights
% of shares and
voting rights through
financial instruments Total, % Total, shares
May 20, 2022 Solidium Oy Above 10% 10.02 10.02 7,934,506
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total of 90 employees have now participated in the program
arranged in collaboration with Maria 01, the leading startup
campus in the Nordics, bringing the new ways of thinking
and working back to their teams.
Statement of non-financial information
The scope of the reporting includes non-financial topics that
relate to Konecranes’ key impacts and reflect stakeholder
expectations. These topics Konecranes identifies through
materiality assessment. The most essential non-financial
topics for Konecranes are responsible business conduct;
anti-corruption; safety of employees; product-related safety
and security; respect of human rights; diversity, equity and
inclusion, greenhouse gas emissions, circular economy and
fair sourcing.
Konecranes reports the disclosed information in accordance
with the Accounting Act amendment 1376/2016, which is
based on the EU Directive 2014/95/EU on the disclosure of
non-financial and diversity information. More information
about the topics is available in the Sustainability Report
2022 that is prepared according to the international
framework of Global Reporting Initiative (GRI),
Sustainability Accounting Standards Board’s SASB standards
as well as following the recommendations of Task Force on
Climate-related Financial Disclosures (TCFD). Konecranes is
a signatory of the United Nations Global Compact striving
for the same goals as the UN regarding human and labor
rights, protecting the environment and fighting corruption.
More information about Konecranes’ external commitments
is available in the Sustainability Report 2022.
Business model and value creation
Konecranes’ business aims to deliver optimal productivity
while improving the safety and environmental sustainability
of the company’s customers’ operations by manufacturing
intelligent and connected lifting devices, adopting new
technologies and optimizing material handling flows.
Safe ways of working are an integral part of Konecranes’
business. By prioritizing safety and security in all areas of
its operations, the company can improve safety throughout
its value chain and provide solutions for uninterrupted and
secure material handling. Information security is essential –
from manufacturing and servicing equipment to Konecranes’
digital ecosystem. Konecranes’ systematic way to manage
information security ensures compliance with legal and
customer requirements. With its knowledge, products,
services and solutions, Konecranes provides monetary value
with sustained profitability and stability and seeks to maximize
the positive contributions for its stakeholders and the society.
Konecranes enables reliable and optimized material handling
performance and can support decarbonization with its
innovative material handling and lifting technologies.
Investing in new technologies and substituting existing
technology with lower-emission alternatives is a big
opportunity for Konecranes and for its customers by
reducing their carbon footprint. Including circular economy
principles in various processes and utilizing several circular
business models helps Konecranes improve its resource
and energy efficiency while creating value for the customer.
For example, the Business Segment Service executes the
product lifecycle extension strategy by offering maintenance
and repairs, remanufacturing of parts, modernization, and
retrofitting. Maintaining the lifecycle value of a device for as
long as possible saves natural resources, as well as reduces
greenhouse gas emissions. The use phase of Konecranes
products can last for decades, so investing in data-driven,
eco- and resource-efficient products means the customer can
preserve the value of their equipment for a longer period of
time and thus also reduce its environmental impact.
Being a preferred partner and being able to select
trustworthy partners is paramount for the whole
Konecranes value chain. Sustainable business practices
and systematic risk management are crucial for creating
longer-term shareholder value and financial stability.
In 2022, Konecranes issued a total of EUR 300 million
Schuldschein loan that has floating and fixed rate tranches
with maturities until 2026, 2027 and 2030. The interest
margin will be adjusted based on Konecranes’ EcoVadis ESG
(Environmental, Social and Governance) rating. The issuing
of the loan demonstrates Konecranes’ commitment to ESG
by connecting the company’s sustainability performance to
financing.
To remain a key player and an attractive employer within
local communities, Konecranes strives to make a positive
impact on the societies in which the company operates. This
is done by providing jobs and income for employees, by
boosting local economies as an employer, supporting non-
profit organizations, providing and buying of local services
and goods, and also being a significant taxpayer in many
countries where the company operates.
In 2022, a total of EUR 458 million (2021: 427) in taxes
and other compulsory tax-like payments were paid and
collected in countries where the Group operates, implying
an effective tax rate of 27.4 percent (2021: 23.4). A total of
EUR 207 million (2021: 182) was paid (taxes borne) directly
by the Group itself, while EUR 251 million (2021: 244)
was collected (taxes collected). Konecranes is a compliant
taxpayer in each country where it operates and does not
practice aggressive tax planning that would artificially
decrease the Group’s taxable income.
Konecranes’ innovation focuses not only on products,
technologies, and service solutions, but also on new ways
of working and leveraging workforce diversity to drive
innovation. Konecranes’ employees, with their expertise and
motivation, are central to the company’s success and bring
the company’s strategy to life. In Konecranes’ view, varied
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skill sets are a key driver of creativity and value creation
to the company’s customers. To ensure that the company
continues to deliver value it focuses on maintaining close
ties with its key stakeholders to understand their evolving
needs and expectations; engaging and developing the best
talent; implementing smart technologies in its product and
service offering; innovating new business models; and
improving product development and reliability.
Environmental responsibility and climate
related disclosures
Konecranes follows the recommendations of the Task
Force on Climate-related Financial Disclosures (TCFD) to
share Konecranes’ approach to climate-related topics in a
transparent manner.
Konecranes’ environmental responsibility agenda is driven
by decarbonization and advancing circularity. The scope
of the agenda includes the company’s own operations,
customers and our supply chain. Konecranes’ commitment
to science-based emission targets to limit the global
warming to 1.5°C is guiding its environmental sustainability
strategy. Konecranes’ commitments concerning
environmental responsibility including all aspects of climate
action and circularity can be found in the company’s Code
of Conduct and in its Environmental Policy, updated in 2021
and available publicly at Konecranes.com. They outline
Konecranes’ principles for managing the environmental
impact, and the company’s Global Vehicle Policy as well as
Corporate Travel Policy support the work.
In 2021, Konecranes extended its climate roadmap to
cover its impacts in the value chain holistically. In 2022
Konecranes focused on developing its eco-optimized
portfolio, continuing the electrification of ports equipment
and decreasing the carbon impact of its supply chain with
a particular focus on steel. Konecranes also updated its
Design for Environment concept.
Climate governance
Sustainability, including climate matters, is embedded
into Konecranes’ governance processes at several levels.
The Board of Directors’ HR Committee is the official
supervisory Board Committee following climate topics
on an annual basis. The Board of Directors approves the
long-term focus, ambition level and targets. The Board
of Directors’ HR Committee reviews performance and
activities annually.
The Konecranes Leadership Team (KLT) plays a significant
role in the company’s management system, strategy
preparation and decision making and is involved in risk
and financial planning process but has no official statutory
position based on legislation or the Articles of Association.
Sustainability is integrated into Konecranes’ strategy. The
KLT reviews the sustainability strategy annually as well
as all major climate related action plans and targets. It
follows emissions data on a monthly basis and oversees
other climate-related issues when needed. Of the KLT
members, Senior Vice President Human Resources (SVP
HR) is responsible for the climate topics and participates
in HR Committee meetings. The Sustainability Council,
nominated by the KLT, sponsored by the SVP People and
Culture and chaired by the Head of Sustainability defines,
guides and reviews the overall sustainability strategy
including climate-related topics, short-term targets and
action plans. The Head of Sustainability is responsible
for taking actions and decisions to the operative level,
and for building and coordinating climate action plans,
proposing activities and targets, and following the
progress.
Climate targets and metrics
Konecranes climate ambition is aligned with the ambition
of Paris Agreement in limiting the global warming to 1.5°C.
The targets were validated by the Science Based Target
initiative in January 2022.
Within Scope 1 and 2 greenhouse gas (GHG) targets,
Konecranes is committed to reducing its absolute carbon
emissions by 50 percent by 2030. As part of the science-
based targets ambition, Konecranes tightened the schedule
to reach the previous target of powering the company’s
factories with 100 percent renewable electricity from 2025
to 2022. The share of renewable electricity in 2022 was 100
percent (2021: 67). Konecranes succeeded in decreasing
emissions from own operation by 50 percent compared to
2019 baseline.
Ninety-nine percent of Konecranes’ emissions originate from
the value chain. The two main Scope 3 emissions categories
are the use of sold products as well as the purchased
goods and services. For scope 3, Konecranes aims to
reduce absolute carbon emissions by 50 percent by 2030,
encompassing the use of sold products and steel related
purchases. This target covers more than 70 percent of the
value chain emissions. As a supportive action, Konecranes
will also fully offset flight emissions. Scope 1 and 2 emissions
data is collected monthly to monitor progress. Scope 3 data
is currently collected at least on an annual basis.
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Environmental management in Konecranes’
own operations
Konecranes focuses on improving the energy efficiency as
well as the waste and chemical management of its own
operations, in both service and manufacturing operations.
In addition to the Science Based Targets, Konecranes has
signed national voluntary agreements on energy efficiency.
The company will meet improvement targets by investing
in energy efficiency actions such as in heat recovery and
lighting as well as to more fuel-efficient cars and route
optimization. In chemical management the objective is to
substitute hazardous chemicals with less harmful ones and
to minimize the amount of hazardous chemicals in products.
Waste management focuses on resource efficiency and
increasing the recycling rate.
Konecranes’ environmental work is driven by the
HSE Excellence that focuses on certifying operations
with ISO14001 Environmental Management System,
implementing rules for environmental behaviour as well as
minimum requirements for environmental management.
Konecranes aims to certify all its manufacturing sites with
ISO 14001:2015. In 2022 total of 83 percent (2021: 80) of
the company’s factories have an ISO 14001 environmental
management system certificate requiring systematic
continuous development and the establishment of local
annual targets. The coverage has increased from 2021.
The company assesses the environmental risks of its
service and manufacturing operations in greater details
as part of the local environmental management system,
where each of the company’s units is responsible for
evaluating, prioritizing, and mitigating their risks on a local
level. Environmental incidents and near-miss cases are
reported through the company’s global Health, Safety and
Environment (HSE) reporting tool, and root causes are
investigated, and corrective actions are taken accordingly.
In addition, the company aims to minimize waste and reuse
and recycle as much as possible.
Eco-optimized offering and circularity
Konecranes promotes decarbonization by substituting
existing technologies with lower-emission alternatives and
by extending product lifecycles with its solutions and service
concepts. Konecranes’ customers gain clear benefits by
investing in durable equipment that can be repaired and
modernized and receive added value from uninterrupted
operations.
In 2021 Konecranes defined a company-level strategy to
further improve the overall environmental responsibility
of its offering that enables the Science Based Targets
pathway and advances circularity. Konecranes’ main focus
is on electrifying the offering as well as ensuring product
development focuses on energy efficiency. For diesel-
powered vehicles, the company provides innovative power
options ranging from hybrids to full electric and battery
technology, with additional energy-saving features such
as regenerative braking. To provide accurate data on the
environmental impact of its solutions for decision making,
the company calculates its products’ energy consumption
and CO
2
emissions, and critically assesses this data
with the help of a third party (as part of the company’s
Environmental Product Declarations).
Konecranes designs its products with their complete lifecycle
in mind, as the majority of the environmental impact of a
product’s lifecycle is defined at the product design stage.
Konecranes’ product design is based on smart design
principles focusing on maintainability, repairability, durability,
and material selections, including recyclability and energy
efficiency. In 2022 the Design for Environment guideline
was upgraded to ensure all products and services shall be
more sustainable than the previous generation.
Konecranes wants to be a leader in advancing circular
economy. Therefore, the company puts efforts into
investigating new circular solutions and their possible
business potential. During 2022, three circular innovation
ideas were moved to a phase, where the company
further studies and evaluates their business opportunities.
Konecranes’ circular economy thinking focuses on using
Emissions 2022 2021 2020 2019
Scope 1 40,100 44,500 43,000 52,500
Scope 2 2,900 14,400 30,300 33,100
Scope 3 4,650,700 5,106,900 4,900,300 5,667,700
• GHG emissions calculated in line with the GHG Protocol methodology.
• Scope 1 includes emissions from fuel, natural gas and LPG consumption and fugitive emissions (refrigerants).
• Scope 2 includes emissions from electricity and district heat consumption. Scope 2 indirect emissions are calculated according to the GHG
Protocol Scope 2 Guidance dual reporting requirement: location-based and market-based method.
• The figures cover all forms of energy used in Konecranes’ manufacturing locations and service units. Potential renewable shares are not taken
into account for fuels. All fuel consumption from Konecranes’ service operations and the electricity consumption from the company’s largest
service office sites are included. Figures on the use of natural gas, LPG and district heat from Konecranes’ service operations are excluded
because collecting this data from the company’s service network is challenging and the consumption amounts are estimated to be very marginal.
• Scope 3 includes emissions from use of sold products, purchased goods and services, upstream transportation and distribution, employee
commuting, investments, fuel- and energy related activities, downstream transportation and distribution, end-of-life treatment of sold products,
capital goods, business travel and waste generated in operations.
• Scope 3 emission factor for category use of sold products was updated. For data comparability, Konecranes applied the new factor also to the
2021 and 2020 figures.
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less, using longer, and using again. Circularity plays an
essential role also in tackling climate change as greenhouse
gas emissions can be reduced by improving resource
efficiency, designing out waste and keeping materials and
products longer in use.
Konecranes’ service operations promote circular economy
by extending the lifecycle of equipment through
maintenance and repairs, remanufacturing of parts,
modernization, and retrofitting; this helps Konecranes
improve its own resource efficiency while reducing
its customers’ environmental footprints. Preventive
maintenance supports emissions reductions as the data
can be used to optimize maintenance activities (service
visits and spare parts needs). Konecranes’ retrofitting
and modernization services can provide a complete
transformation of an existing crane as an alternative
to replacing it by updating the equipment to meet
today’s standards. On top of improved performance,
modernizations save a significant amount of steel and in
most cases reduce use phase emissions when traditional
diesel generators are retrofitted as hybrids or full electric.
Climate risk management
Konecranes has a Group-wide process for evaluating
risks. Climate risks are integrated into multi-disciplinary
company-wide risk management process. The Board of
Directors of Konecranes has defined and adopted a set
of risk management principles based on widely accepted
international management practices. These principles
serve as part of the company’s system of controls and are
designed to ensure that any risks related to the company’s
business operations are identified and managed adequately
and appropriately to safeguard the continuity of Konecranes’
business at all times. As part of the process, risk points are
discussed, documented, and prioritized. For assessing risks,
Konecranes uses the scale of probability, costs of mitigation,
and impacts for the business.
Company-level climate-related risks and opportunities are
assessed systematically at least bi-annually. As a basis
for climate assessment, Konecranes uses the information
received from natural hazard risk evaluations, climate risk
scenario analysis as well as the insights from internal experts
and business segments’ management team members. Short-,
medium- and long-term (0–20 years) risks and opportunities
are identified and assessed. Local environmental and climate-
related risks are assessed according to the requirements of
the ISO 14001 environmental management system. The key
risks are reported to risk management (legal department),
the KLT and to the Board of Directors’ Audit Committee. KLT
and business segment management teams are responsible
to act for supporting in mitigating risks with the needed
activities. More information about climate risks management
can be found from Konecranes CDP answer (chapter
C2), available at Konecranes.com.
Identified risks and opportunities and resilient
business strategy
The potential effects of climate change are far reaching.
Konecranes has reviewed both aspects of climate change –
how does climate change affect Konecranes and how does
Konecranes contribute to climate change. In 2022 Konecranes
updated its climate scenario analysis and verified key risks and
opportunities in all business segments. During the process
potential short to long-term financial impacts were considered.
Konecranes recognizes climate risks having potential
negative impact on short-, medium- and long-term. Among
the most significant physical risks are floods and severe
storms that might damage Konecranes manufacturing
sites or customers’ sites and cause business interruption
and delays in the manufacturing and transportation. The
company has conducted several natural hazard assessments
with its insurance company to understand the probability,
time scale and actual risks involved. This information is
taken into consideration in the business continuity planning.
Technological development is identified to be one of
the most significant transitional risks and opportunities
for Konecranes. In case Konecranes product offering is
not attractive to its customers and does not solve their
environmental targets Konecranes could lose market
share. To mitigate these risks Konecranes has committed
to electrify its offering, continue developing the energy
efficiency of its equipment and seek new services and
solutions that accelerate circularity and digitalization. The
most relevant climate opportunities reside in Konecranes’
offering, enabling the decarbonization of customers’
operations by providing equipment and solutions that
reduce emissions and advance electrification. Transition
to a low-carbon society is faster in the climate scenarios
where global warming is less than 2°C. In these scenarios,
Konecranes has identified possible increased sales
opportunities due to the current and future eco-optimized
offering. The company offers hybrid and electric cranes
as an alternative to traditional diesel-fueled cranes, and
energy-saving features such as regenerative braking to
help customers minimize their emissions. Konecranes
conducts at least three studies annually to seek new
circular opportunities that further support its eco-optimized
offering development.
Emerging regulations create a significant climate-related
risk for the company as they might lead to increased
cost of energy and materials e.g. due to taxes of
carbon-intensive raw-materials. To mitigate this risk,
Konecranes is closely following how the regulations
develop, is applying smart design principles to maximize
the resource efficiency and is investing in renewable
energy sources.
Konecranes considers production methods that improve
energy efficiency and minimize waste as a climate-related
opportunity. The company continues to expand lean
manufacturing with the Konecranes Way program.
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An extensive list of climate risk and opportunities is available
on the website at Konecranes.com. More information is
also available in Konecranes CDP answer (chapter C2).
Respect for human rights
Konecranes respects human rights and promotes the
principles set in the International Bill of Human Rights, UN
Guiding Principles on Business and Human Rights and the
Declaration on Fundamental Principles and Rights at Work
of the International Labor Organization (ILO). Konecranes’
commitment to human rights is evident in multiple internal
policies. The basic principles are stated in Konecranes Code
of Conduct and in 2022 the company published a Human
Rights Policy. Konecranes has also a corporate policy, the
Fair Labor Frame, which sets a standard and ambition to
workforce-related activities, such as working hours and
freedom of association.
Additionally, human rights are addressed in the company’s
Health & Safety and Diversity & Inclusion Policies, as well as
in the data protection compliance requirements. To ensure
that human rights are also respected in Konecranes’ supply
chain, the company has included its basic requirements in
its Supplier Code of Conduct. Human rights are part of the
company’s annual, mandatory Code of Conduct training.
As part of Konecranes’ overall human rights due diligence,
the company regularly assesses human rights risks and
impacts, engages with affected stakeholders and develops
and implements procedures for preventing, mitigating and
monitoring potential and actual adverse human rights impacts
in its own operations and business relationships. The company
works continuously to improve the due diligence process.
In 2022 Konecranes updated its human rights risk and
impact assessment by combining an earlier human rights
risk screening conducted with the help of an external
service provider with results received from different
monitoring sources, such as audits, surveys and a
whistleblowing channel. Amongst relevant potential human
rights risks in the company’s own or in its value chain’s
operations are occupational safety and health, working
conditions, non-discrimination and harassment, slavery and
forced labor, privacy and environmental degradation.
The company has several processes in place to prevent and
mitigate the identified risks. The section Safety explains
how the company is addressing health and safety topics,
while the section Diversity describes the company’s strong
Diversity, Equity & Inclusion program, which proactively
prevents discrimination. The environmental degradation
caused by climate change has various negative impacts on
people. Konecranes works to reduce its carbon emissions,
as written in the section Environmental responsibility
and climate related disclosures. Konecranes takes data
privacy seriously and has a data protection program in place
with a structured governance model and periodic trainings.
Since 2021 Konecranes has conducted third-party social
responsibility assessments in the company’s operations
located in high-risk countries, paying special attention to
issues identified in the human rights risk screening, such as
working conditions. The company took action to mitigate
identified non-conformities locally and is developing global
processes to address topics recurring across the sites.
Assessments will continue in 2023.
To manage the above-mentioned human rights risks within
its complex supplier base, Konecranes has a set of supply
chain compliance management processes. Read more in the
section Responsible business conduct.
Safety
Safety is an integral part of Konecranes’ business and
prioritizing safety in all areas of operation creates a
competitive advantage for the company. Konecranes’ goal
is for everyone to get home safe, every day. Konecranes
seeks to achieve this goal through strategic, centrally led
programs and business-specific initiatives. Transparent
and comprehensive safety reporting and follow-up
procedures help the company build a coherent safety
culture, recognize its most significant risks and validate the
effectiveness of its safety work. Konecranes’ occupational
health and safety principles are defined in the company’s
Code of Conduct and Health and Safety policy. In addition,
the company has several safety management tools and
global practices in place.
There are considerable occupational health and safety
risks in the material handling industry. Konecranes’ most
significant safety risks are related to factory work, vehicle
incidents, crane and equipment installation, and the service
business, where the working conditions of technicians vary
from job to job. All Konecranes employees receive trainings
to perform their tasks safely and correctly.
The company follows incidents and hazards using two
management systems, the ARMOR HSE reporting tool
and the AIR product compliance management system, as
well as through customer feedback collected after each
major delivery. Currently 69 percent of the manufacturing
sites are ISO 45001 certified. Safety performance data
is continuously available to management through online
safety performance dashboards and is addressed on
all management levels. Overall performance trends are
reviewed monthly in the Konecranes Leadership Team and
Business Area leadership meetings, focusing especially
on leading indicators and preventive actions and safety
incidents with Serious Injury or Fatality Potential or Actual
Serious or Fatal outcomes called.
The KPI for Konecranes’ safety is the Total Recordable
Incident (TRI) rate, which refers to the number of injuries
requiring medical treatment per one million working hours.
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The recordable incident rate for 2022 was 5.6 (6.7 in 2021),
an improvement of 16 percent compared to the previous
year. The company also tracks the number of Safety
Observations made as a leading KPI. In 2022, Konecranes
personnel made a total of 71,382 safety observations, which
was 40 percent more than in 2021 (51,004).
People strategy
Konecranes’ talented, diverse, innovative, and engaged
employees help its customers improve safety and
productivity every day. The Konecranes people strategy
supports this by ensuring that the needed resources
and competencies for the future are in place, and that
employees are engaged, motivated and capable to meet
future business requirements.
Konecranes believes in engagement and continuous learning
and development, and offers its employees a variety of
training courses and activities in areas like technology,
sales, communication, leadership, health and safety,
language, culture and project management. In addition,
employees can enrich their work, for example, by learning
from peers or on the job, and by joining communities, such
as employee resource groups.
At Konecranes employee engagement is measured by
conducting pulse surveys and employee engagement
surveys across the organization. The main risk related
to low employee engagement is the loss of talent and
competencies. At Konecranes this risk is mitigated through
fair and competitive compensation, culture and leadership
development programs, succession planning, internal
job rotation and talent management, as well as various
programs to support professional growth and well-being.
Diversity
Konecranes aims to create a diverse and inclusive working
environment where people feel trusted, they can be
themselves and there is a sense of belonging. Konecranes
wants to represent the multicultural communities where
it operates and be a great partner for its customers. All
backgrounds and the variety of talents are an asset for
the company’s growth. Konecranes’ work is based on a
Diversity, Equity and Inclusion (DEI) vision, supported
by a “4T” strategy (Talented, Transforming, Trusted and
Togetherness). The company has already successfully
integrated Diversity and Inclusion into the company’s
cultural foundation and business agenda.
During 2022, Konecranes further developed its approach,
expanded it to cover equity, and embedded inclusion and
equity in the company’s processes. The objective is to make
sure that everybody can have the opportunity to succeed,
and that their diverse backgrounds are valued. By assuring
psychological safety, variety of ideas and viewpoints
inherent in diverse backgrounds, we aim to be the company
of choice for employees with the potential to be the
best in the industry. Inclusion means that the strengths
of differences are welcomed and leveraged and that
Konecranes offers a working environment where everyone
can be themselves and feel valued for their contribution.
In Konecranes’ view, varied skillsets are a key driver of
creativity and value creation, and diversity and inclusivity
result in teams that deliver better results.
Konecranes continued to raise awareness on DEI topics
internally. Key activities in 2022 included internal “Coffee
and Culture” webinar series focusing on the company’s
culture and belonging; launching new learning paths related
to resilience and detecting biases; running Employee
Resource Groups on various DEI-related topics that focus
in raising awareness, providing support, and improving the
work environment.
The current gender balance for all Konecranes employees
is 18.2 percent female and 81.7 percent male. Konecranes
has a goal to have at least 22 percent gender diversity in
the total organization and in leadership by the end of 2025.
The progress is followed on a monthly basis. Mentoring and
the fast-track program continued, supporting the increase
of women in leadership positions. At the end of 2022, there
were 14.3 percent women in leadership positions (2021:
14.3). Konecranes takes gender and geographic diversity
into consideration in the talent and succession plan process.
The company involved the entire organization in its inclusive
talent process, allowing to identify talents and create
development actions. Our efforts and systematic approach
in DEI was rewarded in 2022 by the Finnish Foundation
for Share Promotion (Pörssisäätiö) where Konecranes has
been recognized as the best Finnish Large Cap company
furthering diversity.
Responsible business conduct
Konecranes’ Code of Conduct and Corporate Governance
Framework guide the everyday activities of the company
by clearly describing internal standards and ethical values
as well as legal obligations. The Code of Conduct is
complemented by several Group-wide policies covering
areas including safety, environment, supplier requirements,
anti-corruption, data protection, competition compliance
and diversity. The main compliance policies and the yearly
Code of Conduct training are available in 35 languages. All
employees are expected to understand and abide by the
Code of Conduct. Konecranes has a regular compliance
and ethics risk assessment process supported by risk
assessment surveys to gather insights throughout the
organization. Konecranes global Compliance & Ethics
program is managed by the Group’s Compliance & Ethics
team and its development and quality are overseen by an
executive-level Compliance and Ethics Committee and Audit
Committee of the Board of Directors of Konecranes Plc.
Konecranes promotes a healthy speak-up culture
where people can feel safe reporting ethical concerns.
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Multiple ways to raise concerns are offered, including
an externally hosted Whistleblowing Channel open to
the company’s employees as well as all externals, which
enables anonymous reporting when allowed by local
laws. All reports made are reviewed and investigated,
as appropriate. There is a clear policy of no retaliation.
Konecranes also encourages its suppliers and other
business partners to report on any compliance and ethics
concerns relating to Konecranes.
During 2022 the focus was put on updating the
Group’s whistleblowing and investigation processes and
related guidance to ensure compliance with the new
whistleblowing law requirements especially in the EU.
Also, multiple awareness-raising activities took place in
2022, with the main focus on advanced competition law
trainings, relaunch of our trade sanctions and export
controls e-learning and the yearly Code of Conduct
training. The Code of Conduct training is mandatory for all
employees globally, including operatives, and over 15,000
employees were trained during 2022.
To help mitigate risks and drive ethical practices in supply
chains, the Konecranes Supplier Code of Conduct (SCoC)
states the sustainability standards expected from third
parties. The SCoC has requirements, for example, on
anti-corruption, human rights, safety, environmental and
compliance topics. The SCoC forms a key part of any
agreements made with key suppliers and subcontractors.
By the end of 2022, 52 percent of suppliers (as share
of spend) had a signed commitment to the SCoC or
equivalent requirements. Background checks on suppliers
and subcontractors are done before entering into business
relationships and defined suppliers are assessed based
on self-assessments. The requirements are regularly
reviewed and developed to ensure that environmental and
social impacts are managed properly through responsible
sourcing. In 2022 Konecranes continued third-party supplier
audits concentrating particularly on compliance with
Konecranes’ Supplier Code of Conduct.
Anti-corruption and bribery prevention
Konecranes’ Anti-Corruption policy and Code of Conduct
demonstrate the company’s commitment to work against
corruption in all forms, including extortion and bribery and
set the foundation for our anti-corruption program. The Anti-
Corruption Policy has compliance protocols and guidelines
in place to detect and address risks, with a zero-tolerance
approach embedded in the monitoring and follow-up
processes. Several actions and processes are set up to
mitigate corruption and fraud risks including internal controls,
a Gift and Hospitality Portal and Conflict of Interest portal.
Anti-Corruption matters form an important element of
the Code of Conduct training. Konecranes’ zero-tolerance
approach is also promoted to business partners in the
Konecranes Distributor Code of Conduct, Supplier Code of
Conduct and Supplier Manual. Konecranes uses a risk-
based Know-Your-Counterparty process to conduct due
diligence and background screenings, identify red-flags and
carry out risk assessments on third parties worked with
whereby the level of scrutiny and required approval process
are determined by considering, for example, the risks
associated with the business in question, country risks and
business partner risks. Selected suppliers are also audited
for their anti-corruption work.
Taxonomy eligibility and alignment
Konecranes has activities that qualify as environmentally
sustainable according to the EU Taxonomy as per EU
Regulation 2020/852. Konecranes has activities that are
in the scope of Technical Screening Criteria (TSC) 3.6.
Manufacture of other low carbon technologies and 8.2.
Data-driven solutions for greenhouse gas (GHG) emissions
reductions. These activities are, according to Article 16 of
the Taxonomy Regulation, enabling substantial contribution
towards climate change mitigation, which is one of the
objectives defined in Article 9 of the Regulation.
The process for reviewing taxonomy-eligibility and
alignment of all Konecranes activities was completed
in 2022. It included identifying the eligible activities,
reviewing the technical screening criteria (TSC) and the
Do-No-Significant-Harm criteria (DNSH) for each of the
environmental objectives for all relevant business activities
and carrying out an assessment of the Minimum Social
Safeguards (MSS) at corporate level. The purpose of the
process was to define the taxonomy-eligibility and alignment
and to gather evidence of the substantial contribution.
The relevant activities of Konecranes are eligible with the
objective of Climate Change Mitigation (CCM) according
to the Technical Screening Criteria of 3.6. Manufacture
of other low carbon technologies and 8.2. Data-driven
solutions for greenhouse gas (GHG) emissions reductions.
The calculation of the revenue percentage is based on
low carbon technology such as inverter-controlled drives,
regenerative braking and hybrid and electric power options.
These technologies substitute existing technology with
lower-emission alternatives. These activities are enabling
substantial contribution towards climate change mitigation
according to representative life cycle assessments (LCA)
made in comparison to the best performing alternative
technologies. Eligibility of revenue was evaluated at product
level and represent only sales to external customers for
each Business Segment. Taxonomy-eligible products
represent 14 percent of Konecranes’ revenue. The revenue
percentage of software solutions eligible for TSC 8.2.
represents 0–1 percent of total revenue.
Subsequent assessments made for all the eligible
activities confirmed that Konecranes has adequate social
minimum safeguards in place. Konecranes is committed
to UN guiding principles on Business and Human rights
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and OECD guidelines. Konecranes has analyzed the
Do No Significant Harm criteria towards remaining five
environmental objectives. Konecranes has identified that
its products include commercial components that on low
concentrations include Substances of Very High Concern
(SVHC) e.g. lead that is restricted in the Pollution prevention
and control criterion g. Konecranes is compliant with the
REACH Regulation. Konecranes fulfils the other four Do
No Significant Harm criteria. Konecranes is expecting the
EU to publish more guidance related to the “essential for
the society” exemption to define whether the revenue is
taxonomy-aligned. For this reason, Konecranes will not
report its alignment.
CapEx and the specifically defined categories of OpEx
described in the Taxonomy Regulation are reported at
company level. 12 percent of CapEx and 36 percent of
specifically defined taxonomy OpEx is taxonomy eligible.
These activities include, for example, facility improvements,
sourcing of green activities and research and development
projects. They support the transition towards a low carbon
economy and achieving the Science Based Targets set for
own operations and for the value chain.
Economic activity
Revenue
FY 2022
Revenue
FY 2021
Revenue
FY 2022
Climate
change
mitigation
Climate
change
adaptation
Climate
change
mitigation
Climate
change
adaptation
Water &
marine
resources
Circular
economy Pollution
Biodiversity
and
ecosystems
Minimum
social
safeguards
Taxonomy-
aligned
proportion
of revenue
2022
Taxonomy-
aligned
proportion
of revenue
2021
Of which
Enabling or
Transitional
activity
MEUR MEUR % % % Y/N Y/N Y/N Y/N Y/N Y/N
Company
level
% % E/T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A1. Environmentally sustainable activities (Taxonomy-
aligned)
N/A N/A N/A Y Y Y Y N/A Y Y N/A N/A E
A2. Taxonomy-eligible but not environmentally
sustainable activities (not Taxonomy-aligned)
N/A N/A N/A Y Y Y Y N/A Y Y N/A N/A E
Turnover of eligible activities with substantial contribution 462 289 14%
Segment Port Solutions: Electric and hybrid equipment
(activity 3.6.)
326 155 10% 10% 0% Y Y Y Y N/A Y Y N/A N/A E
Segment Industrial Equipment: Wire rope hoists with
inverter-controlled drives and winches with regenerative
braking (activity 3.6.)
136 134 4% 4% 0% Y Y Y Y N/A Y Y N/A N/A E
Segment Industrial Service: Wire rope hoists with inverter-
controlled drives and winches with regenerative braking
(activity 3.6.)
3 2 0% 0% 0% Y Y Y Y N/A Y Y N/A N/A E
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Turnover of Taxonomy-non-eligible activities 2,903 2,897 86%
Total (A+B) 3,365 3,186 100%
Table 1. Revenue
Substantial
contribution criteria DNSH criteria (Does Not Significantly Harm)
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Economic activity
Capex
FY 2022
Capex
FY 2021
Capex
FY 2022
Climate
change
mitigation
Climate
change
adaptation
Climate
change
mitigation
Climate
change
adaptation
Water &
marine
resources
Circular
economy Pollution
Biodiversity
and
ecosystems
Minimum
social
safeguards
Taxonomy-
aligned
proportion
of capex
2022
Taxonomy-
aligned
proportion
of capex
2021
Of which
Enabling or
Transitional
activity
MEUR MEUR % % % Y/N Y/N Y/N Y/N Y/N Y/N Corp. E/T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A1. Environmentally sustainable activities (Taxonomy-
aligned)
N/A N/A N/A Y Y Y Y N/A Y Y N/A N/A E
A2. Taxonomy-eligible but not environmentally
sustainable activities (not Taxonomy-aligned)
N/A N/A N/A Y Y Y Y N/A Y Y N/A N/A E
Turnover of eligible activities 5 2 12%
Related to taxonomy-eligible assets or processes,
enabling to become aligned, purchase of taxonomy-
eligible activities, enabling activities to become low-
carbon or to reduce emissions
5 2 12% 12% Y Y Y Y Y Y Y 12% 5% E
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Turnover of Taxonomy-non-eligible activities 32 47 88%
Total (A+B) 37 50 100%
Table 2. Capex
Substantial
contribution criteria DNSH criteria (Does Not Significantly Harm)
Economic activity
Opex
FY 2022
Opex
FY 2021
Opex
FY 2022
Climate
change
mitigation
Climate
change
adaptation
Climate
change
mitigation
Climate
change
adaptation
Water &
marine
resources
Circular
economy Pollution
Biodiversity
and
ecosystems
Minimum
social
safeguards
Taxonomy-
aligned pro-
portion of
opex 2022
Taxonomy-
aligned pro-
portion of
opex 2021
Of which
Enabling or
Transitional
activity
MEUR MEUR % % % Y/N Y/N Y/N Y/N Y/N Y/N E/T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A1. Environmentally sustainable activities (Taxonomy-
aligned)
N/A N/A N/A Y Y Y Y N/A Y Y N/A N/A E
A2. Taxonomy-eligible but not environmentally
sustainable activities (not Taxonomy-aligned)
N/A N/A N/A Y Y Y Y N/A Y Y N/A N/A E
Turnover of eligible activities 24 26 36%
Related to taxonomy-eligible assets or processes,
enabling to become aligned, purchase of taxonomy-
eligible activities, enabling activities to become low-
carbon or to reduce emissions
24 26 36% 36% Y Y Y Y Y Y Y
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Turnover of Taxonomy-non-eligible activities 43 40 64%
Total (A+B) 67 66 100%
Table 3. Opex
Substantial
contribution criteria DNSH criteria (Does Not Significantly Harm)
Konecranes continues to develop taxonomy assessment and
reporting in 2023 as the final technical screening criteria for
the four remaining objectives will be finalized. According to
the current draft criteria it is possible that certain service
activities of Konecranes will be eligible and aligned according
to the new objectives. The total taxonomy-eligible and
aligned revenue is therefore expected to increase in 2023
as the activities related to service are expected to partially
fall in the forthcoming scope of the environmental objective
“Transition to a circular economy and waste prevention”.
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Litigation
Various legal actions, claims, and other proceedings are
pending against the Group in different countries. These
actions, claims, and other proceedings are typical for this
industry and are consistent with the global business offering
that encompasses a wide range of products and services.
These matters involve contractual disputes, warranty claims,
product liability (including design defects, manufacturing
defects, failure to warn, and asbestos legacy), employment,
auto liability, and other matters involving liability claims.
Risks and uncertainties
Global pandemics, such as COVID-19, have and may
have a negative impact on Konecranes’ customers and its
own operations. Physical restrictions on the daily conduct
of people and businesses can lead to lower revenue
recognition and adversely impact cash flow. Physical
restrictions may also lead to component availability and
other supply chain issues and inventory obsolescence.
Furthermore, global pandemics can increase the likelihood
of weaker demand conditions and, as a result, may lead to
overcapacity, impairment of assets and credit losses.
Global component and labor availability issues and other
global supply chain constraints may lead to production and
customer delivery delays and have a negative impact on
Konecranes sales and cash flow. Accelerated inflation may
increase risk for negative impact on Konecranes cash flow
and result.
Konecranes operates in emerging countries that face
political, economic, and regulatory uncertainties. Adverse
changes in the operating environment of these countries
may result in currency losses, elevated delivery costs, or
loss of assets. Konecranes operates a crane factory in
Zaporizhzhia, Ukraine. In 2022, Konecranes impaired all
Ukraine-related assets as the level of uncertainty regarding
Konecranes’ operations in Ukraine remains high due to the
ongoing war.
The operations in emerging countries have had a negative
impact on the aging structure of accounts receivable and
may increase credit losses or the need for higher provisions
for doubtful accounts.
Political risks and uncertainties have also increased outside
the emerging countries due to the emergence of populism,
patriotism, and protectionism in a number of Western
economies. This has led and can lead to further increases
in tariffs on imported goods, such as components that
Konecranes manufactures centrally before exporting them
to most of the countries in which it operates. The resulting
tariffs may result in a decrease in profitability.
Konecranes has made several acquisitions and expanded
organically into new countries. A failure to integrate the
acquired businesses, MHPS and MHE-Demag in particular, or
grow newly established operations may result in a decrease
in profitability and impairment of goodwill and other assets.
One of the key strategic initiatives of Konecranes is
oneKONECRANES. This initiative involves a major capital
expenditure on information systems. A higher-than-
expected development or implementation costs, or a
failure to extract business benefits from new processes and
systems may lead to an impairment of assets or decrease in
profitability.
Konecranes delivers projects, which involve risks related,
for example, to engineering and project execution with
Konecranes’ suppliers. A failure to plan or manage these
projects may lead to higher-than-estimated costs or
disputes with customers.
Challenges in financing, e.g. due to currency fluctuations,
may force customers to postpone projects or even cancel
the existing orders. Konecranes intends to avoid incurring
costs for major projects under construction in excess of
advance payments. However, it is possible that the cost-
related commitments in some projects temporarily exceed
the number of advance payments.
The Group’s other risks are presented in the Notes to the
Financial Statements and the Governance Supplement to
the Annual Report.
Date Release
December 22,
2022
Konecranes Plc's Shareholders' Nomination
Board's proposals for the composition and
compensation of the Board of Directors
October 26, 2022
Konecranes Plc: Interim report January–
September 2022
October 25, 2022
Konecranes Plc's financial information and AGM
in 2023
September 20,
2022
Composition of the Shareholders' Nomination
Board of Konecranes Plc
July 27, 2022
Konecranes Plc: Half-year financial report
January–June 2022
July 15, 2022
Anders Svensson to start as President and CEO
of Konecranes on October 19, 2022, Konecranes
plans to host a CMD in H1/2023
July 12, 2022
Profit warning: Konecranes lowers full-year 2022
financial guidance
June 15, 2022
Konecranes Restricted Share Unit Plan 2017 -
directed share issue
June 15, 2022
Konecranes Plc: Board of Directors' organizing
meeting
Stock exchange releases during full
year 2022
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Date Release
June 15, 2022
Resolutions of Konecranes Plc's Annual General
Meeting of shareholders
June 10, 2022
Anders Svensson appointed President and CEO
of Konecranes
May 20, 2022
Konecranes Plc: Notice pursuant to the Finnish
Securities Market Act, Chapter 9, Section 10
May 13, 2022
Konecranes Plc's Board of Directors convenes the
Annual General Meeting 2022
May 11, 2022
Konecranes Plc's Shareholders' Nomination Board
revises its proposals for the Annual General
Meeting
April 27, 2022 Konecranes Plc: Interim report January–March 2022
April 27, 2022 Changes in Konecranes Leadership Team
April 26, 2022
Konecranes plans to hold the Annual General
Meeting on June 15, 2022; the Board has
decided its dividend proposal
April 21, 2022
Konecranes comments on the impacts of the
war in Ukraine on its business and financial
performance
March 30, 2022
The Board of Directors of Konecranes Plc has
resolved to establish a new Performance Share Plan
March 30, 2022
The Board of Directors of Konecranes Plc decided
to continue the Employee Share Savings Plan
March 29, 2022
Konecranes comments on its strategy and next
steps following the abandonment of the planned
merger and cancels its Annual General Meeting
scheduled for March 30, 2022
March 29, 2022
The UK CMA blocks the merger between
Konecranes and Cargotec and thus the
Companies have Jointly Decided to Cancel the
Planned Merger
February 28,
2022
Konecranes Plc's Annual Report 2021 published
February 25,
2022
Notice to the Annual General Meeting of
Konecranes Plc
February 24,
2022
The European Commission Conditionally
Approved the Proposed Merger; the Completion
Remains Subject to Further Authority Approvals
Date Release
February 3, 2022
Proposals by the board of directors to the annual
general meeting 2022
February 3, 2022
The Board of Directors of Konecranes Plc has
resolved the criterion for the measurement
period 2022 of the Performance Share Plans
2020 and 2021
February 3, 2022 Konecranes Plc: Financial statement release 2021
February 3, 2022
Konecranes and Cargotec provide an update on
planned merger: Remedy requirements are more
complex than expected, dialogue with relevant
competition authorities continues
January 28, 2022
Konecranes Plc's Shareholders' Nomination
Board's proposals for the composition and
compensation of the Board of Directors
Corporate press releases during full
year 2022
• On December 22, 2022, Konecranes announced that
a Port in the Bahamas ordered a Konecranes Gottwald
Generation 6 Mobile Harbor Crane to raise productivity
and eco-efficiency. The order was booked in November
2022.
• On December 13, 2022, Konecranes announced that its
climate work was rewarded with an A- rating in CDP’s
Climate Change performance ranking.
• On December 1, 2022, Konecranes announced that
an Indian port operator ordered three Generation 6
Konecranes Gottwald Mobile Harbor Cranes to electrify
bulk handling. The order was booked in September 2022.
• On October 27, 2022, Konecranes announced that it is to
deliver a complete automated container handling solution
to London Gateway. The order was booked in April 2022.
• On October 12, 2022, Konecranes announced that its
January–September 2022 interim report will be published
on October 26, 2022.
• On October 6, 2022, Konecranes announced that Port
Houston ordered 26 eco-efficient hybrid Konecranes
RTGs. The order was booked in Q3 2022.
• On October 4, 2022, Konecranes announced that CSP
Spain ordered 11 Konecranes hybrid RTGs. The order was
booked in Q3 2022.
• On September 30, 2022, Konecranes announced that a
North Italian terminal ordered a Generation 6 Konecranes
Gottwald Mobile Harbor Crane to lift productivity and eco-
efficiency. The order was booked in July 2022.
• On September 15, 2022, Konecranes announced that the
Konecranes-led international research project OPTIMUM
was awarded by ITEA for Excellence for leaps in smart
factory development.
• On September 5, 2022, Konecranes announced that
Georgia Ports Authority ordered 12 Konecranes RTGs for
the Port of Savannah. The order was booked Q3 2022.
• On July 13, 2022, Konecranes announced that it had
successfully placed a EUR 300 million ESG-linked
Schuldschein loan on strong demand from investors.
• On July 13, 2022, Konecranes announced that its
January–June 2022 half-year financial report will be
published on July 27, 2022.
• On July 1, 2022, Konecranes announced that Kemi
Shipping ordered eight Konecranes E-VER electric forklifts
to its fleet in northern Finland. The order was booked in
June 2022.
• On May 31, 2022, Konecranes announced that it is to
supply nuclear fuel handling machines to Sweden’s
largest nuclear power plant. The order was booked in
April 2022.
• On May 18, 2022, Konecranes announced that it had
been named best Finnish Large Cap company on
furthering diversity.
• On April 26, 2022, Konecranes announced that Georgia
Ports Authority had ordered a fleet of 22 Konecranes
container cranes. The order was booked in Q1 2022.
• On April 13, 2022, Konecranes announced that its
56
FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
January–March 2022 interim report will be published on
April 27, 2022.
• On February 1, 2022, Konecranes presented new climate
targets in line with limiting global warming to 1.5°C.
• On January 26, 2022, Konecranes announced that it
provides 17 Automated Rubber-Tired Gantry Cranes in
fully integrated solution for Port of Felixstowe. The order
was booked in Q4 2021.
• On January 20, 2022, Konecranes announced that its
financial statement release 2021 will be published on
February 3, 2022.
• On January 10, 2022, Konecranes announced that it
partnered with Pesmel to supply automated warehouse
container handling systems.
Events after the end
of the reporting period
On February 1, 2023, Konecranes announced that the Board
of Directors had decided to establish a new Performance
Share Plan 2023 for Konecranes key employees. The Plan
has a three-year performance period from 2023 to 2025.
The Plan has two performance criteria: the cumulative
adjusted Earnings per Share (EPS) for the financial
years 2023–2025 with a 60 percent’s weighting and the
compound annual growth rate (CAGR) for Sales for the
financial years 2023–2025 with a 40 percent’s weighting.
The targets for the three-year performance period have
also been decided by the Board of Directors. The target
group of the Plan consists of a maximum of 170 Konecranes
key employees. Additional information, including essential
terms and conditions of the Plan, is available in the stock
exchange release dated February 1, 2023.
On February 1, 2023, Konecranes announced that the Board
of Directors had decided the criterion for the measurement
period 2023 of the Performance Share Plans 2021 and
2022. The criterion is adjusted earnings per share (EPS).
Also the targets for the measurement period 2023 were
decided by the Board of Directors. Additional information on
the criterion is available in the stock exchange release dated
February 1, 2023.
On February 1, 2023, Konecranes announced that the
Board of Directors had decided to launch a new Plan Period
relating to the Employee Share Savings Plan. The new Plan
Period will begin on July 1, 2023, and will end on June 30,
2024. The other terms and conditions approved by the
Board have been published in the stock exchange release
on dated February 1, 2023.
First quarter demand outlook
The worldwide demand picture remains subject to volatility
and uncertainty.
Despite the weakened global macro indicators, our overall
demand environment within industrial customer segments
has remained good and continues on a healthy level. That
said, we have started to see some signs of weakening in
all three regions.
Global container throughput continues high, and long-
term prospects related to global container handling
remain good overall.
Financial guidance
Konecranes expects net sales to increase in full-year 2023
compared to 2022. Konecranes expects the full-year 2023
adjusted EBITA margin to improve from 2022.
Board of Directors’ proposal for
disposal of distributable funds
The parent company’s non-restricted equity is EUR
956,868,289.67, of which the net income for the year is
EUR 100,324,987.85. The Group’s non-restricted equity is
EUR 1,364,732,000.
According to the Finnish Companies Act, the distributable
funds of the company are calculated based on the parent
company’s non-restricted equity. For the purpose of
determining the amount of the dividend, the Board of
Directors has assessed the liquidity of the parent company
and the economic circumstances subsequent to the end of
fiscal year.
Based on such assessments, the Board of Directors
proposes to the Annual General Meeting to be held on
March 29, 2023, that a dividend of EUR 1.25 be paid on
each share and that the remaining non-restricted equity
is retained in shareholders’ equity. The proposal will be
included in the notice to the Annual General Meeting, which
will be published during February 2023.
A PDF version of the Konecranes’ full audited financial
statements, including the report of the Board of Directors,
and corporate governance statement will be available
as pdf documents on Konecranes website on Tuesday,
February 28, 2023.
Espoo, February 1, 2023
Konecranes Plc
Board of Directors
57
FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Konecranes Group 2018−2022
Business development 2022 2021 2020 2019 2018
Orders received MEUR 3,928.9 3,175.5 2,727.3 3,167.3 3,090.3
Order book MEUR 2,901.7 2,036.8 1,715.5 1,824.3 1,715.4
Net sales MEUR 3,364.8 3,185.7 3,178.9 3,326.9 3,156.1
of which outside Finland MEUR 3,262.0 3,098.1 3,096.3 3,244.2 3,056.3
Export from Finland MEUR 789.6 955.2 1,075.9 969.6 777.0
Personnel on average 16,563 16,625 17,027 16,104 16,247
Personnel on December 31 16,522 16,573 16,862 16,196 16,077
Capital expenditure MEUR 37.0 49.8 42.8 39.5 35.4
as % of Net sales % 1.1% 1.6% 1.3% 1.2% 1.1%
Research and development costs MEUR 47.7 47.7 48.5 41.1 42.1
as % of Net sales % 1.4% 1.5% 1.5% 1.2% 1.3%
Profitability
Net sales MEUR 3,364.8 3,185.7 3,178.9 3,326.9 3,156.1
Adjusted EBITA MEUR 318.4 312.2 260.8 275.1 257.1
as % of net sales % 9.5% 9.8% 8.2% 8.3% 8.1%
Adjusted operating profit MEUR 286.6 279.1 224.9 250.4 219.6
as % of net sales % 8.5% 8.8% 7.1% 7.5% 7.0%
Operating profit MEUR 223.2 220.0 173.8 148.7 166.2
as % of net sales % 6.6% 6.9% 5.5% 4.5% 5.3%
Income before taxes MEUR 190.7 192.5 170.3 118.5 138.7
as % of net sales % 5.7% 6.0% 5.4% 3.6% 4.4%
Net income
(incl. non-controlling interest)
MEUR 138.5 147.4 122.9 82.8 98.3
as % of net sales % 4.1% 4.6% 3.9% 2.5% 3.1%
Key figures and balance sheet 2022 2021 2020 2019 2018
Equity (incl.
non-controlling interest)
MEUR 1,433.0 1,360.6 1,251.1 1,246.7 1,284.1
Balance sheet MEUR 4,340.6 3,845.8 4,016.5 3,854.2 3,567.0
Return on equity % 9.9 11.3 9.8 6.5 7.7
Return on capital employed % 9.0 9.3 8.3 6.3 7.9
Current ratio 1.6 1.2 1.4 1.4 1.3
Equity to asset ratio % 37.9 38.9 34.1 35.4 39.8
Net working capital MEUR 581.2 424.5 337.2 446.0 410.4
Interest-bearing net debt MEUR 688.3 541.6 577.1 655.3 545.3
Gearing % 48.0 39.8 46.1 52.6 42.5
Shares in figures
Earnings per share, basic EUR 1.77 1.86 1.54 1.03 1.29
Earnings per share, diluted EUR 1.77 1.85 1.54 1.03 1.29
Equity per share EUR 18.10 17.08 15.69 15.70 16.06
Cash flow per share EUR 0.84 2.13 5.15 2.19 1.39
Dividend per share EUR 1.25* 1.25 0.88 1.20 1.20
Dividend/earnings % 70.6 67.2 57.1 116.5 93.0
Effective dividend yield % 4.3 3.6 3.1 4.4 4.5
Price/earnings 16.2 18.9 18.7 26.6 20.5
Trading low / high** EUR 19.61/38.43 28.80/42.31 14.05/33.08 24.84/38.15 25.05/42.43
Average share price** EUR 27.14 36.41 23.03 29.98 33.56
Share price on December 31** EUR 28.76 35.16 28.78 27.40 26.39
Year-end market capitalization MEUR 2,276.8 2,782.4 2,277.5 2,160.2 2,080.0
Number traded*** (1,000) 87,275 56,561 121,487 96,906 123,158
Stock turnover % 110.3 71.5 153.6 122.9 156.3
Average number of shares
outstanding, basic
(1,000) 79,152 79,134 79,078 78,836 78,811
Average number of shares
outstanding, diluted
(1,000) 79,508 79,607 79,272 78,836 78,811
Number of shares outstanding,
at end of the period
(1,000) 79,167 79,134 79,134 78,839 78,817
* The Board’s proposal to the AGM
** Source: Nasdaq Helsinki
*** Source: Intercontinental Exchange
58
FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Calculation of key figures
Operating profit (EBIT)
Sales + Other operating income − Materials, supplies and subcontracting −
Personnel cost − Depreciation and impairment − Other operating expenses
Adjusted EBITA
Operating profit (EBIT) + purchase price allocation impacts and
impairment + restructuring costs + transaction costs + other items
affecting to comparability
Adjusted Operating profit
Operating proft (EBIT) + restructuring costs + transaction costs + other
items affecting to comparability
Return on equity (%):
Net profit for the period
X 100
Total equity (average during the period)
Return on capital employed
(%):
Income before taxes + interest paid + other financing cost
X 100
Total amount of equity and liabilities − non-interest bearing debts
(average during the period)
Current ratio:
Current assets
Current liabilities
Equity to asset ratio (%):
Shareholders' equity
X 100
Total amount of equity and liabilities – advance payment received
Gearing (%):
Interest-bearing liabilities – liquid assets – loans receivable
X 100
Total equity
Earnings per share:
Net profit for the shareholders of the parent company
Average number of shares outstanding
Earnings per share, diluted:
Net profit for the shareholders of the parent company
Average fully diluted number of shares outstanding
Equity per share:
Equity attributable to the shareholders of the parent company
Number of shares outstanding
Cash flow per share:
Net cash flow from operating activities
Average number of shares outstanding
Effective dividend yield (%):
Dividend per share
X 100
Share price at the end of financial year
Price per earnings:
Share price at the end of financial year
Earnings per share
Net working capital:
Non interest-bearing current assets + deferred tax assets (excluding Purchase
Price Allocation) – Non interest-bearing current liabilities – deferred tax liabilities
(excluding Purchase Price Allocation) – provisions
Interest-bearing net debt:
Interest-bearing liabilities (non current and current) – cash and
cash equivalents – loans receivable (non current and current)
Year-end market capitalization:
Number of shares outstanding multiplied by the share price
at the end of year
Average number of personnel: Calculated as average of number of personnel in quarters
Number of shares outstanding: Total number of shares - treasury shares
Operating profit % and EBITA % are used to measure business profitability
before financial items and taxes. Adjusted operating profit and Adjusted
EBITA are used to reflect the underlying business performance and to
enhance comparability between financial periods and is frequently used by
management, analysts and investors. See also note 3 for reconciliation.
Return on equity % represents the rate of return that shareholders receive
on their investments and Return on capital employed % represent relative
profitability or the rate of return that has been received on capital employed
requiring interest or other return.
Current ratio, Equity to asset ratio, Interest-bearing net debt, Interest-
bearing net debt / Equity are used to measure solvency and indebtedness
of the Konecranes Group. Some of Konecranes’ loan agreements include
a covenant measured by Gearing percentage. Capital expenditure and Net
working capital give additional information of the cash flows and funding needs
of the Konecranes Group. Share related alternative performance measures
enhance the information of equity, cash flow and dividend attributable to
the shareholders and development of the Konecranes share value in the
stock exchange.
59
FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Reconciliation of certain alternative
performance measures
Reconciliation of adjusted operating profit and adjusted EBITA (MEUR) 2022 2021
Operating profit 223.2 220.0
Restructuring costs
Employment termination costs 4.8 13.5
Impairments of non-current assets 2.9 0.3
Impairments of inventories 4.8 -0.1
Other restructuring costs and income 4.5 -2.3
Restructuring costs, total 17.0 11.3
Transaction and integration costs 8.7 47.8
Costs related to the impacts of the war in Ukraine 37.8 0.0
Adjusted operating profit 286.6 279.1
Purchase price allocation and goodwil impairment impacts 31.8 33.2
Adjusted EBITA 318.4 312.2
Reconciliation of interest-bearing net debt
Interest-bearing liabilities 1,106.2 865.1
Loans receivable -3.9 -2.8
Cash and cash equivalents -413.9 -320.7
Interest-bearing net debt 688.4 541.6
Reconciliation of net working capital
Total current assets 2,369.2 1,842.6
- Interest bearing current assets -3.9 -2.8
- Cash and cash equivalents -413.9 -320.7
Non-interest-bearing current assets 1,951.4 1,519.0
Deferred tax assets (excluding purchase price allocation) 103.8 120.2
Total current liabilities -1,480.8 -1,585.9
- Current Interest-bearing liabilities 49.8 418.0
Non-interest-bearing current liabilities -1,431.0 -1,167.9
Deferred tax liabilities (excluding purchase price allocations) -23.9 -26.2
Non-current provisions -19.0 -20.7
Net working capital 581.2 424.5
Transaction and integration costs 2022 and 2021 relate to the cancelled merger with Cargotec Oyj.
60
FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Consolidated statement of income − IFRS
(1,000,000 EUR)
Jan 1–Dec 31
2022
Jan 1–Dec 31
2021
Note:
3,5,6 Sales 3,364.8 3,185.7
Other operating income 8.1 11.3
7 Materials, supplies and subcontracting -1,510.2 -1,413.0
7,8 Personnel cost -1,091.9 -1,023.5
9 Depreciation and impairments -124.4 -120.1
7 Other operating expenses -423.2 -420.4
Operating profit 223.2 220.0
4,16 Share of associates' and joint ventures' result 0.4 0.3
10 Financial income 26.8 28.6
10 Financial expenses -59.7 -56.4
Profit before taxes 190.7 192.5
11 Taxes -52.2 -45.1
PROFIT FOR THE PERIOD 138.5 147.4
Profit for the period attributable to
Shareholders of the parent company 140.3 146.9
Non-controlling interest -1.8 0.5
12 Earnings per share, basic (EUR) 1.77 1.86
12 Earnings per share, diluted (EUR) 1.77 1.85
CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME
(1,000,000 EUR)
Jan 1–Dec 31
2022
Jan 1–Dec 31
2021
Note:
Profit for the period 138.5 147.4
Items that can be reclassified into
profit or loss
34 Cash flow hedges 2.0 -11.0
Exchange differences on translating
foreign operations
-3.2 22.8
11.3
Income tax relating to items that
can be reclassified into profit or loss
-0.4 2.2
Items that cannot be reclassified
into profit or loss
28
Re-measurement gains (losses) on
defined benefit plans
62.6 17.6
11.3
Income tax relating to items that cannot
be reclassified into profit or loss
-18.7 -5.8
Other comprehensive income
for the period, net of tax
42.3 25.8
TOTAL COMPREHENSIVE INCOME
FOR THE PERIOD
180.8 173.2
Total comprehensive income
attributable to:
Shareholders of the parent company 183.1 172.6
Non-controlling interest -2.3 0.6
The accompanying notes form an integral part of the consolidated financial statements.
61
FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Consolidated balance sheet − IFRS
EQUITY AND LIABILITIES
(1,000,000 EUR) Dec 31, 2022 Dec 31, 2021
Note:
Equity attributable to equity holders
of the parent company
Share capital 30.1 30.1
Share premium 39.3 39.3
Paid in capital 752.7 752.7
34 Fair value reserves -1.1 -2.7
Translation difference 8.3 11.0
Other reserve 67.8 65.7
Retained earnings 395.5 308.4
Net profit for the period 140.3 146.9
23
Total equity attributable to equity
holders of the parent company
1,432.9 1,351.4
16 Non-controlling interest 0.1 9.2
Total equity 1,433.0 1,360.6
Non-current liabilities
26,27,32 Interest-bearing liabilities 1,056.4 447.1
28 Other long-term liabilities 217.7 289.0
24 Provisions 19.0 20.7
17 Deferred tax liabilities 133.7 142.6
Total non-current liabilities 1,426.8 899.4
Current liabilities
26,27,32 Interest-bearing liabilities 49.8 418.0
6 Advance payments received 564.3 344.7
Accounts payable 306.2 255.4
24 Provisions 93.4 105.4
25
Other short-term liabilities
(non-interest-bearing)
56.1 53.2
32 Other financial liabilities 15.9 16.9
Income tax payables 31.7 23.0
Accrued costs related to delivered
goods and services
165.1 178.3
25 Accruals 198.3 190.9
Total current liabilities 1,480.8 1,585.8
Total liabilities 2,907.6 2,485.2
TOTAL EQUITY AND LIABILITIES 4,340.6 3,845.8
The accompanying notes form an integral part of the consolidated financial statements.
ASSETS
(1,000,000 EUR) Dec 31, 2022 Dec 31, 2021
Note:
Non-current assets
13 Goodwill 1,019.6 1,022.1
14 Intangible assets 475.4 503.1
15 Property, plant and equipment 345.9 339.3
Construction in progress 18.1 10.9
16
Investments accounted for
using the equity method
7.8 6.8
Other non-current assets 0.8 0.8
17 Deferred tax assets 103.8 120.2
Total non-current assets 1,971.4 2,003.2
Current assets
18 Inventories 992.7 726.4
19 Accounts receivable 585.6 492.1
20 Other receivables 36.8 28.1
Income tax receivables 15.0 16.2
6 Contract assets 183.5 161.3
32 Other financial assets 43.7 3.6
21 Deferred assets 98.0 94.2
22 Cash and cash equivalents 413.9 320.7
Total current assets 2,369.2 1,842.6
TOTAL ASSETS 4,340.6 3,845.8
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FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Consolidated statement of changes in equity − IFRS
Equity attributable to equity holders of the parent company
(1,000,000 EUR) Share capital
Share
premium
account
Paid in
capital
Cash flow
hedges
Translation
difference
Other
reserve
Retained
earnings Total
Non-
controlling
interest
Total
equity
Balance at January 1, 2022 30.1 39.3 752.7 -2.7 10.9 65.7 455.4 1,351.4 9.2 1,360.6
Dividends paid to equity holders -98.9 -98.9 -0.3 -99.2
Equity-settled share based
payments (note 29)
2.1 0.0 2.1 2.1
Acquisitions -4.8 -4.8 -6.5 -11.3
Profit for the period 140.3 140.3 -1.8 138.5
Other comprehensive income 1.6 -2.6 43.8 42.8 -0.5 42.3
Total comprehensive income 1.6 -2.6 184.1 183.1 -2.3 180.8
Balance at December 31, 2022 30.1 39.3 752.7 -1.1 8.3 67.8 535.8 1,432.9 0.1 1,433.0
Balance at January 1, 2021 30.1 39.3 752.7 6.0 -11.7 58.0 367.6 1,242.0 9.1 1,251.1
Dividends paid to equity holders -69.6 -69.6 -0.2 -69.8
Equity-settled share based
payments (note 29)
7.7 0.0 7.7 7.7
Acquisitions -1.3 -1.3 -0.3 -1.6
Profit for the period 146.9 146.9 0.5 147.4
Other comprehensive income -8.7 22.6 11.8 25.7 0.1 25.8
Total comprehensive income -8.7 22.6 158.7 172.6 0.6 173.2
Balance at December 31, 2021 30.1 39.3 752.7 -2.7 10.9 65.7 455.4 1,351.4 9.2 1,360.6
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FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Consolidated cash flow statement − IFRS
(1,000,000 EUR)
Jan 1−Dec 31
2022
Jan 1−Dec 31
2021
Note:
Cash flow from operating activities
Profit for the period 138.5 147.4
Adjustments to net profit for the period
Taxes 52.2 45.1
Financial income and expenses 32.9 27.8
Share of associates' and joint ventures'
result
-0.4 -0.3
Depreciation and impairments 124.4 120.1
Profits and losses on sale of fixed assets -2.4 -4.2
Other adjustments -0.7 10.1
Operating income before change
in net working capital
344.5 346.0
Change in interest-free current receivables -159.9 -28.0
Change in inventories -264.4 -65.3
Change in interest-free current liabilities 262.0 -5.7
Change in net working capital -162.3 -99.0
Cash flow from operations before
financing items and taxes
182.2 247.0
Interest received 28.0 13.1
Interest paid -56.5 -28.1
Other financial income and expenses -33.7 -16.2
11 Income taxes paid -53.3 -47.4
Financing items and taxes -115.5 -78.6
NET CASH FROM OPERATING ACTIVITIES 66.7 168.4
(1,000,000 EUR)
Jan 1−Dec 31
2022
Jan 1−Dec 31
2021
Note:
Cash flow from financing activities
4 Acquisition of Group companies, net of cash -1.6 0.0
4 Divestment of businesses, net of cash 0.1 0.0
Capital expenditures -44.7 -40.5
Proceeds from sale of property, plant
and equipment and other
2.6 9.8
NET CASH USED IN INVESTING
ACTIVITIES
-43.6 -30.7
Cash flow before financing activities 23.1 137.7
Cash flow from financing activities
27.6 Proceeds from borrowings 600.0 0.0
27.6 Repayments of borrowings -331.7 -155.6
27.6 Repayments of lease liability -44.1 -42.6
27.6
Proceeds from (+), payments of (-) current
borrowings
-43.7 -146.4
Change in loans receivable -1.2 -1.0
Acquired non-controlling interest -11.0 -1.6
Dividends paid to equity holders of the
parent company
-98.9 -69.6
Dividends paid to non-controlling interests -0.3 -0.2
NET CASH USED IN FINANCING
ACTIVITIES
69.1 -417.0
Translation differences in cash 1.0 8.1
CHANGE OF CASH AND CASH
EQUIVALENTS
93.2 -271.2
Cash and cash equivalents at beginning
of period
320.7 591.9
22 Cash and cash equivalents at end of period 413.9 320.7
CHANGE OF CASH AND CASH
EQUIVALENTS
93.2 -271.2
The effect of changes in exchange rates has been eliminated by converting the beginning balance at the rates
current on the last day of the year.
The accompanying notes form an integral part of the consolidated financial statements.
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1. Corporate information
Konecranes Plc (“Konecranes Group” or “the Group”) is a
Finnish public limited company organized under the laws of
Finland and domiciled with its principal place of business in
Hyvinkää. The company is listed on the NASDAQ Helsinki.
Konecranes is a world-leading manufacturer and servicer
of cranes, lifting equipment and machine tools, serving
a broad range of customers, including manufacturing
and process industries, shipyards, ports and terminals.
Konecranes operates internationally, with its products being
manufactured in North and South America, Europe, Africa,
the Middle East, and Asia and sold worldwide. Konecranes
has three reportable segments: Service, Industrial
Equipment and Port Solutions.
2. Accounting principles
2.1. Basis of preparation
The consolidated financial statements of Konecranes Plc
have been prepared in accordance with International
Financial Reporting Standards (IFRS) as adopted
by the EU.
The consolidated financial statements have been prepared
on a historical cost basis, except for items that are required
by IFRS to be measured at fair value, principally certain
financial instruments.
The consolidated financial statements including notes
thereto are presented in millions of euros and all values
are rounded to the nearest million (€000,000) except when
otherwise indicated.
Due to the rounding, some totals might differ from the sum
of individual figures as calculations are done originally in
thousands of euros.
The financial statements were approved for issuance by the
Board of Directors on February 1, 2023.
Principles of consolidation
The consolidated financial statements comprise the
consolidated balance sheet of Konecranes Plc and its
subsidiaries as at December 31, 2022 and 2021 and the
consolidated statements of income and cash flows for
the periods ended December 31, 2022 and 2021. Control
is achieved when the Group is exposed, or has rights, to
variable returns from its involvement with the investee and
has the ability to affect those returns through its power over
the investee. Specifically, the Group controls an investee if,
and only if, the Group has:
• Power over the investee (i.e., existing rights that give
it the current ability to direct the relevant activities of
the investee)
• Exposure, or rights, to variable returns from its
involvement with the investee
• The ability to use its power over the investee to affect
its returns
Generally, there is a presumption that majority of voting
rights result in control. To support this presumption and
when the Group has less than majority of the voting
or similar rights of an investee, the Group considers all
relevant facts and circumstances in assessing whether it has
power over an investee, including:
• The contractual arrangement with the other vote
holders of the investee
• Rights arising from other contractual arrangements
• The Group’s voting rights and potential voting rights
The Group re-assesses whether or not it controls an
investee if facts and circumstances indicate that there are
changes to one or more of the three elements of control.
Consolidation of a subsidiary begins when the Group obtains
control over the subsidiary and ceases when the Group
loses control of the subsidiary. Assets, liabilities, income and
expenses of a subsidiary acquired or disposed of during the
year are included in the consolidated financial statements
from the date the Group gains control until the date the
Group ceases to control the subsidiary.
Profit or loss and each component of other comprehensive
income (OCI) are attributed to the equity holders of the
parent of the Group and to the non-controlling interests, even
if this results in the non-controlling interests having a deficit
balance. When necessary, adjustments are made to the
financial statements of subsidiaries to bring their accounting
policies into line with the Group’s accounting policies. All
intra-group assets and liabilities, equity, income, expenses
and cash flows relating to transactions between members of
the Group are eliminated in full on consolidation.
A change in the ownership interest of a subsidiary, without
a loss of control, is accounted for as an equity transaction.
Notes to the consolidated financial statements
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If the Group loses control over a subsidiary, it derecognizes
the related assets (including goodwill), liabilities, non-
controlling interest and other components of equity while
any resultant gain or loss is recognized in profit or loss. Any
investment retained is recognized at fair value.
Investment in associates and joint ventures
An associate is an entity over which the Group has
significant influence. Significant influence is the power to
participate in the financial and operating policy decisions
of the investee but is not control or joint control over
those policies.
A joint venture is a type of joint arrangement whereby
the parties that have joint control of the arrangement
have rights to the net assets of the joint venture. Joint
control is the contractually agreed sharing of control of an
arrangement, which exists only when decisions about the
relevant activities require unanimous consent of the parties
sharing control.
The Group’s investments in its associates and joint
ventures are accounted for using the equity method.
Under this method, the consolidated financial statements
show the Group’s investment in and share of net assets
of the associate or joint venture. Any premium over net
assets paid to acquire an interest in an associate or joint
venture is recognized as goodwill within the same line
as the underlying investment. The statement of profit or
loss reflects the Group’s share of the results of operations
of the associate or joint venture. Any change in OCI of
those investees is presented as part of the Group’s OCI. In
addition, when there has been a change recognized directly
in the equity of the associate or joint venture, the Group
recognizes its share of any changes, when applicable, in the
statement of changes in equity. Unrealized gains and losses
resulting from transactions between the Group and the
associate or joint venture are eliminated to the extent of the
interest in the associate or joint venture.
After application of the equity method, the Group
determines whether it is necessary to recognize an
impairment loss on its investment in its associate or joint
venture. At each reporting date, the Group determines
whether there is objective evidence that the investment in
the associate or joint venture is impaired. If there is such
evidence, the Group calculates the amount of impairment
as the difference between the recoverable amount of the
associate or joint venture and its carrying value, and then
recognizes the loss as share of profit of an associate and a
joint venture in the statement of profit or loss.
2.2. Use of estimates and judgments
The preparation of the financial statements in accordance
with IFRS requires management to make estimates and
judgments that affect the valuation of reported assets
and liabilities and other information, such as contingent
liabilities and recognition of income and expenses in
the statement of income. These assumptions, estimates
and judgments are based on management’s historical
experience, best knowledge about the events and other
factors, such as expectations on future events, which
the company assess to be reasonable in the given
circumstances. Although these estimates and judgments
are based on the management’s best understanding of
current events and circumstances, actual results may differ
from the estimates. Changes in estimates and assumptions
are recognized in the financial period the estimate or
assumption is changed.
The most important items in the consolidated financial
statements, which require management’s estimates and
that involve complex and subjective judgments and the
use of assumptions, some of which may be for matters
that are inherently uncertain and susceptible to change
are impairment testing, recognition of deferred taxes,
measurement of the fair value of assets and actuarial
assumptions in defined benefit plans, and percentage of
completion revenue recognition in long term projects.
Impairment testing
The recoverable amount for goodwill has been determined
based on value in use of the relevant cash generating unit
to which the goodwill is allocated. The recoverable amounts
of all material intangible assets and property, plant and
equipment have also been based on their value in use.
The impairment testing of goodwill is based on numerous
judgmental estimates of the present value of the cash flows
which effect the valuation of the cash generating units (CGU)
pertaining to the goodwill. Cash flow forecasts are made based
on CGU specific historical data, order book, the current market
situation, and industry specific information of the future
growth possibilities. These assumptions are reviewed annually
as part of management’s annual and strategic planning
cycles and can be subject to significant adjustment as arising
from the development of the global economy, pressure from
competitors’ products, climate risks and opportunities as well
as changes in raw material prices and operating expenses.
The value of the benefits and savings from the efficiency
improvement programs already announced and included in
certain cash flow estimates are also subjective and based on
management’s best estimate of the impact. The fair value of
the CGUs is determined using a derived weighted average cost
of capital as the rate to discount estimated future cash flows.
The discount rate used may not be indicative of actual rates
obtained in the markets in the future. See note 13.
Business Combinations
Acquisitions of subsidiaries are accounted for using the
acquisition method according to which the acquired
company’s identifiable assets, liabilities and contingent
liabilities are measured at fair value on the date of
acquisition. The excess of the consideration transferred
for the business combination over the acquirer’s interest
in the net fair value of the identifiable assets, liabilities
and contingent liabilities is recorded as goodwill. The
measurement of fair value of the acquired net assets is
based on market value of similar assets (property, plant
and equipment), or an estimate of expected cash flows
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(intangible assets). The valuation, which is based on
prevailing repurchase value, expected cash flows or
estimated sales price, requires management judgement,
estimates and assumptions. See note 4.
Recognition of deferred taxes
The ultimate realization of deferred tax assets is dependent
upon the generation of future taxable income during the
periods in which those temporary differences become
deductible or in which tax losses can be utilized. The tax
effect of unused tax losses is recognized as a deferred tax
asset when it becomes probable that the tax losses will
be utilized. In making assessments regarding deferred tax
assets, management considers the scheduled reversal of
deferred tax liabilities, projected future taxable income and
tax planning strategies. The actual current tax exposure is
estimated together with assessing temporary differences
resulting from differing treatment of items, such as
depreciation, provisions and accruals, for tax and accounting
purposes. When recording the deferred tax assets judgments
have been based on the estimates of the taxable income in
each subsidiary and country in which Konecranes operates,
and the period over which the deferred tax assets will be
recoverable based on the estimated future taxable income
and planned tax strategies to utilize these assets. The
amount of deferred tax assets considered realizable could
however be reduced in subsequent years if estimates of
future taxable income during their carry forward periods are
reduced, or rulings by the tax authorities are unfavourable.
Estimates are therefore subject to change due to both
market related and tax authorities related uncertainties, as
well as Konecranes’ own future decision matters such as
restructuring. Konecranes is unable to accurately quantify
the future adjustments to deferred income tax expense that
may occur as a result of these uncertainties. See note 17.
Actuarial assumptions in defined benefit plans
The net pension liability and expense for defined benefit
plans is based on various actuarial assumptions such as the
assumed discount rate, expected development of salaries
and pensions and mortality rates. Significant differences
between assumptions and actual experience, or significant
changes in assumptions, may materially affect the pension
obligations. The effects of actual results differing from
assumptions and the changing of assumptions are included
in Remeasurement gains/loss on defined benefit plans in
other comprehensive income. Discount rates are determined
annually based on changes in long-term, high quality
corporate bond yields.
Decreases in the discount rates results in an increase in the
defined benefit obligation and in pension costs. Conversely,
an increase in the discount rate results in a decrease in the
defined benefit obligation and in pension costs. Increases
and decreases in mortality rates have an inverse impact on
the defined benefit obligation and pension costs. Increases
and decreases in salary and pension growth rates have a
direct correlating impact on the defined benefit obligation
and pension costs.
The assumed discount rate, which is based on rates
observed at the end of the preceding financial year may
not be indicative of actual rates realized. The actual
development for salaries and pensions may not reflect the
estimated future development due to the uncertainty of the
global economy and various other factors. Konecranes uses
generational mortality tables to estimate probable future
mortality improvements. These tables assume that the
trend of increasing life expectancy will continue, resulting in
pension benefit payments to younger members being likely
to be paid for longer time periods than older members’
pensions, given that assumed retirement ages are those
defined in the rules of each plan.
The funded status, which can increase or decrease based on
the performance of the financial markets or changes in our
assumptions, does not represent a mandatory short-term cash
obligation. Instead, the funded status of a defined benefit
pension plan is the difference between the defined benefit
obligation and the fair value of the plan assets. See note 28.
Revenue recognition over time in long-term projects
Konecranes applies the percentage of completion method
for recognizing revenue over time from certain long-term
large crane projects and modernizations in accordance with
IFRS 15 Revenue Recognition. The percentage of completion
is based on the cost-to-cost method. Under this method,
progress of contracts is measured by actual costs incurred
in relation to management’s best estimate of total estimated
costs at completion, which are reviewed and updated
routinely for contracts in progress. The cumulative effect of
any change in estimate is recorded in the period in which the
change in estimate is determined.
The percentage of completion method of accounting involves
the use of assumptions and projections, principally relating
to future material, labour and project-related overhead costs.
As a consequence, there is a risk that total contract costs
will exceed those originally estimated and the margin will
decrease, or the contract may become unprofitable. This risk
increases as the duration of a contract increases because
there is a higher probability that the circumstances upon
the estimates were originally based will change, resulting
in increased costs that may not be recoverable. Factors
that could cause costs to increase include: unanticipated
technical problems with equipment supplied or developed by
us which may require us to incur additional costs to remedy,
changes in the cost of components, materials or labour,
project modifications creating unanticipated costs, suppliers’
or subcontractors’ failure to perform, and delays caused by
unexpected conditions or events. By recognizing changes in
estimates cumulatively, recorded revenue and costs to date
reflect the current estimates at the stage of completion for
each project. Additionally, losses on long-term contracts are
recognized in the period when they are identified and are
based upon the anticipated excess of contract costs over the
related contract revenues.
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COVID-19 and the war in Ukraine
The impacts of the Covid-19 pandemic and the war in
Ukraine on estimates in the financial reporting rely on
management’s best judgement. The Group has assessed the
impacts to goodwill, other intangible and tangible assets as
part of the impairment testing process, and to defined benefit
plans, provisions, valuation of inventory, recoverability of
deferred tax assets and collectability of account receivables
as part of the regular reporting process.
Uncertainties remain regarding the COVID-19 pandemic and
related component availability issues as well as other supply
chain constraints.
Konecranes operates a crane and component factory
in Zaporizhzhia, in the south-eastern part of Ukraine.
The production at the Ukrainian factory was stopped
immediately after the war in Ukraine started. The planned
production has been redirected to other Konecranes
manufacturing sites. As the level of uncertainty regarding
Konecranes’ operations in Ukraine remains high due to
the ongoing war, Konecranes impaired all Ukraine-related
assets, including inventories and receivables. Konecranes
also decided not to take any new business from Russia,
wrote off orders and reversed sales related to Russian
projects, divested its Russian Service business to local
management who have established their own companies
and cancelled all Russian maintenance agreements. The war
has increased market volatility and uncertainty by increasing
cost inflation and global material availability concerns and
other supply chain issues. See note 24.
Significant judgement has been used for the cash flows
used for calculation of recoverable amounts of cash
generating units in impairment testing. The estimates
and assumptions for market development, growth, and
other significant factors used in the impairment testing are
based on management’s best estimates under the current
circumstances. See note 13.
Konecranes reviews and estimates its customer credit risks
related to accounts receivable and ongoing projects as part
of normal reporting process. Provision for doubtful accounts
has been prepared based on the historical credit loss pattern,
but it is also adjusted case by case with forward-looking
risk positions. There has not been any significant change in
payment delays related to customer receivables. To limit the
risks, the Group applies a conservative credit policy towards
customers. It is Konecranes practice to review customers
carefully before entering formal business relationships and to
require credit reports from new customers. Customer credit
risks are mitigated with advance payments, letters of credits,
payment guarantees and credit insurance where applicable.
See note 19.
Although COVID-19 and the war in Ukraine have impacted
the delays in deliveries and have led to increase in certain
inventory levels, Konecranes does not see material increase
of the risk for obsolete inventory values. There have not
been major order cancellations, but rather the orders and
deliveries have been postponed. The risks related to work in
progress and contract assets are also mitigated with advance
payments collected from customers.
Climate risks
Climate risks might have a significant impact on our
operations, which requires significant judgment for example
in revenue recognition (especially in long-term projects),
provisions, collectability of accounts receivable and
impairment of assets.
The biggest climate-related risks are physical risks related
to own operations and supply chain, transitional risks
related to technological decisions, and market risks related
to cost impacts. Market risks can relate to increased
production costs due to changing input prices (energy,
raw materials etc.) and output requirements (for example
waste treatment). Technological development pressure
in carbon-intensive industries might also increase the
development costs as well as the availability of technology
or key components. The potential physical risks are mostly
related to transportation or production locations. An
increase in extreme weather conditions could especially
affect our crane installations and project sites. Heavy
rainfall and floods would put some of our production
sites at risk. Extreme weather conditions can also have
a potential impact on the shipment of our products or
spare parts. The impacts of the climate risks on estimates
and assumptions used in the financial reporting rely on
management’s best judgement and knowledge under the
current circumstances.
2.3. Summary of significant accounting policies
Revenue recognition
Revenue is recognized at an amount of consideration to
which the Group expects to be entitled in exchange for
transferring promised goods or services to a customer and
to the extent that it is probable that the economic benefits
will flow to the company, that revenue can be reliably
measured, and that collectability is reasonably assured.
Revenue is measured at the fair value of the consideration
received or receivable. The creditworthiness of the buyer is
assessed before engaging into a sale. However, if a risk of
non-payment arises after revenue recognition, a provision
for non-collectability is established.
The company recognizes revenue when it satisfies an
identified performance obligation by transferring promised
goods or service to the customer. Goods and services are
generally considered to be transferred when the customer
obtains the control to it. Control means that the customer
can direct the use of and obtain benefit from the good and
service and also prevent others from directing the use of
and receiving the benefits from them. Thus, the customer
has sole possession of the right to use the good or service
for the remainder of its economic life or to consume the
good or service in its own operations.
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The transaction price is usually fixed but may also include
variable considerations such as volume or cash discounts
or penalties. Variable consideration is included in the
revenue only to the extent that it is highly probable that
the amount will not be subject of significant reversal when
the uncertainty is resolved. The variable considerations
are estimated using the most likely value method if not yet
realized in the end of the reporting period. If the contract
is separated in to more than one performance obligation,
Konecranes allocates the total transaction price to each
performance obligation based on the estimated relative
standalone selling prices of the promised goods or services
in each performance obligation or if the standalone selling
prices do not exist Konecranes typically uses the expected
cost plus a margin approach to estimate the standalone
selling price.
Contract assets relate to receivables arising from
percentage of completion method. Net asset balances
are balances where the sum of contract costs, recognized
profits and recognized losses exceed advance payments
received. Where advance payments received exceed the
sum of contract costs, recognized profits, and recognized
losses these liabilities are included in the line-item
advance payments received. Contract assets are subject
to impairment assessment. See also financial assets at
amortized cost.
Nature of goods and services and timing of
satisfaction of performance obligations and
significant payment terms
Service segment principally generates revenue from
providing maintenance and consultative services as well
as spare parts for all types and makes of industrial cranes
and hoists. Service also provides modernizations which
are complete transformations of existing cranes as an
alternative to replacing them. Revenue from services is
recognized when the outcome of the transaction can be
estimated reliably and by customer acknowledgement for
the completion of the service work or by reference to the
stage of completion based on services performed at the
end of the reporting period if it can be measured. The
assessment of the stage of completion is dependent on the
nature of the contract but will generally be based on costs
incurred to the extent these relate to services performed
up to the reporting date. In modernization projects,
typically customer controls the assets that is enhanced
thus the revenue is recognized over time according to the
percentage of completion method. In spare parts business,
the transfer of control and revenue recognition usually
takes place either when goods are shipped or made
available to the buyer for shipment, depending on the
terms of the contract or when the customer has accepted
the delivery. Usually, customers pay according to agreed
payment terms after the services and products have been
delivered. Sometimes it is required that the payment is
done in advance. In these cases, for example in annual
maintenance contracts, the payment is periodized to
meet the revenue recognition in accordance with the
delivery of services and goods. In modernization projects
the customers are typically required to make advance
payments according to the milestones defined in the
modernization project contract.
Industrial Equipment segment generates revenue from
hoists, cranes and material handling solutions for a
wide range of customers. For standard equipment and
components, the revenue is recognized when goods are
shipped or made available to the buyer for shipment,
depending on the terms of the contract or when the
customer has accepted the delivery, which is typically
an installed crane. The revenue from large, engineered
crane projects is recognized over time according to the
percentage of completion (POC) method as those contracts
are specifically negotiated for the construction of an asset
or a combination of assets that are closely interrelated or
interdependent in terms of their design, technology and
function or their ultimate purpose or use. Konecranes is
then also entitled to an amount that at least compensates
the entity for performance completed to date even if the
customer can terminate the contract for the reasons other
than our failure to perform as promised. In general, the
warranty period for cranes is two years for which Group
records a warranty provision based on historical data.
The revenue for extended warranty is recognized over the
extended warranty period. In crane projects the customers
are typically required to make advance payments in
accordance with the milestones defined in the crane
project contract.
Port Solutions segment generate revenue from container
handling equipment, shipyard equipment, mobile harbor
cranes, heavy-duty lift-trucks and Port Solutions related
software. All equipment deliveries are supported by a
complete range of services. Most of the container handling
and shipyard equipment are tailored and engineered to
the customer needs so the revenue from these projects
is recognized over time according to the percentage
of completion (POC) method as those contracts are
specifically negotiated for the construction of an asset or
a combination of assets that are closely interrelated or
interdependent in terms of their design, technology and
function or their ultimate purpose or use. Konecranes is
then also entitled to an amount that at least compensates
the entity for performance completed to date even if the
customer can terminate the contract for the reasons other
than our failure to perform as promised. The revenue of
lift trucks and standard ports equipment is recognized
when goods are shipped or made available to the buyer
for shipment, depending on the terms of the contract or
when the customer has accepted the delivery. The general
warranty period for ports equipment differs to some extent
depending on the components used in the projects. For
general warranty the Group records a warranty provision
based on historical data. The revenue for possible
extended warranty is recognized over the extended
warranty period. In Port Solutions projects the customers
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are typically required to make advance payments
according to the milestones defined in the project contract.
The advance payments from clients do not generally
include a significant financing component, because
typically the payment schedule of advances follows the
timing of performance obligations to be satisfied.
Measurement of stage of completion for
performance obligations satisfied over time
The stage of completion of a contract is determined
by the proportion that the contract costs incurred for
the work performed to date bear to the estimated total
contract costs (cost-to-cost method) at completion. This
depicts best the transfer of control to the customer, which
occurs as we incur costs on our contracts. When the final
outcome of a project cannot be reliably determined, the
costs arising from the project are expensed in the same
reporting period in which they occur, but the revenue from
the project is recorded only to the extent that the Group
will receive an amount corresponding to actual costs. An
expected loss on a contract is recognized immediately in
statement of income. Revenue in respect of variations
to the contract scope and claims is recognized when it is
probable that it will be received and is capable of being
measured reliably.
Research and development costs
Research costs are expensed as incurred. Development
expenditures on an individual project are recognized as an
intangible asset when the Group can demonstrate:
• The technical feasibility of completing the
intangible asset so that it will be available for use or sale.
• Its intention to complete and its ability to use or
sell the asset.
• How the asset will generate future economic benefits.
• The availability of resources to complete the asset.
• The ability to reliably measure the expenditure during
development.
Amortization of capitalized development costs begins when
development is complete, and the asset is available for use.
Adjusted EBITA (alternative performance measure)
Group is using adjusted EBITA as alternative performance
measure, to reflect the underlying business performance
and to enhance comparability between financial periods.
It is frequently used by management, analysts and
investors. Adjusted operating profit before amortization
and impairment of purchase price allocations (a non-GAAP
measure) represents earnings from continuing operations
before income taxes (a GAAP measure), excluding
restructuring, transaction and restructuring related
asset impairment costs as well as other adjusting items,
amortization and impairment of purchase price allocations
and financial income and expense. Alternative Performance
measures should not be considered as a substitute for
measures of performance in accordance with the IFRS. See
also note 3.
Earnings per share
Basic earnings per share are computed by dividing net
income from continuing operations and net income
from discontinued operations all attributable to ordinary
shareholders by the weighted average number of shares
outstanding during the year. Diluted earnings per share
are calculated by assuming conversion or exercise of all
potentially dilutive share-based payment plans.
Dividend distribution
The company recognizes a liability to make dividend
distributions to equity holders when the distribution is
approved by the shareholders. A corresponding amount is
recognized directly in equity.
Employee benefits
Konecranes companies have various pension plans in
accordance with local conditions and practices. Pensions
are generally managed for the Group companies by
outside pension insurance companies or by similar
arrangements. These pension plans are classified either
as defined contribution or defined benefit plans. Under
defined contribution plans, expenses are recognized for
the period the contribution relates to. The Group has no
legal or constructive obligation to pay further contributions
if the fund does not hold sufficient assets to pay employee
benefits. The Konecranes Group accounts for the Finnish
system under the Employees’ Pensions Act (TyEL) within
insurance system as a defined contribution plan.
Under defined benefit plans, a liability recognized in the
balance sheet equals to the net of the present value
of the defined benefit obligation (calculated using the
Projected Unit Credit Method) less the fair value of the
plan assets at the balance sheet date. Actuarial gains
and losses are recognized in the consolidated statement
of other comprehensive income as remeasurement items
when they occur. Remeasurement recorded in other
comprehensive income is not recycled. Past service cost
is recognized in the statement of profit or loss in the
period of plan amendment. Net-interest is calculated by
applying the discount rate to the net defined liability or
asset. Independent actuaries calculate the defined benefit
obligation by applying the Projected Unit Credit Method.
The Group presents service cost, past-service cost, gains
and losses on curtailments and settlements and net
interest expense or income as Personnel cost – Pension
costs: Defined benefit plans in the statement of income
(see note 8).
A liability for termination benefit is recognized at the earlier
of when the entity can no longer withdraw the offer of the
termination benefit and when the entity recognizes any
related restructuring costs.
Share-based payments
Employees (including senior executives) of the Group
and its subsidiaries receive remuneration in the form
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of share-based payments, whereby employees render
services as consideration for equity instruments (equity-
settled transactions) or receive settlement in cash
(cash-settled transactions).
Equity-settled transactions
The cost of equity-settled transactions is determined by
the fair value at the date when the grant is made using an
appropriate valuation model.
That cost is recognized, together with a corresponding
increase in other reserves in equity, over the period in which
the performance and/or service conditions are fulfilled in
Personnel cost – Other personnel expense in the statement
of income. The cumulative expense recognized for equity-
settled transactions at each reporting date until the vesting
date reflects the extent to which the vesting period has
expired and the Group’s best estimate of the number of
equity instruments that will ultimately vest. The expense
or credit recorded in the statement of income for a period
represents the movement in cumulative expense recognized
as at the beginning and end of that period.
No expense is recognized for awards that do not ultimately
vest, except for equity-settled transactions for which
vesting is conditional upon a market or non-vesting
condition. These are treated as vesting irrespective of
whether or not the market or non-vesting condition is
satisfied, provided that all other performance and/or
service conditions are satisfied.
When the terms of an equity-settled award are modified,
the minimum expense recognized is the expense had
the terms not been modified, if the original terms of
the award are met. An additional expense is recognized
for any modification that increases the total fair value
of the share-based payment transaction or is otherwise
beneficial to the employee as measured at the date
of modification.
The tax laws or regulations usually obliges Konecranes
to withhold an amount for an employee’s tax obligation
associated with a share-based payment and transfer that
amount, normally in cash, to the tax authority on the
employee’s behalf. To fulfil this obligation, the terms of
the share-based payment arrangement permit Konecranes
to withhold the number of equity instruments equal to
the monetary value of the employee’s tax obligation from
the total number of equity instruments that otherwise
would have been issued to the employee upon vesting
of the share-based payment. This share-based payment
arrangement with a net settlement feature is classified
in its entirety as an equity-settled share-based payment
transaction and the payment made shall be accounted for
as a deduction from equity for the shares withheld.
Cash-settled transactions
The cost of cash-settled transactions, which is usually
related to the additional employee social cost or taxes of
the share-based payments, is measured initially at fair
value at the grant date using a binomial model. This fair
value is expensed over the period until the vesting date
with recognition of a corresponding liability. The liability is
remeasured to fair value at each reporting date up to, and
including the settlement date, with changes in fair value
recognized in Personnel cost – Other personnel expenses in
the statement of income (see Note 8).
Foreign currency translation
The Group’s consolidated financial statements are reported
in euros, which is the Group’s presentation currency. Each
entity in the Group determines its own functional currency
and items included in the financial statements of each entity
are measured using that functional currency.
Transactions and balances
Transactions in currencies other than the entity’s functional
currency (foreign currencies) are recognized by the Group
entities at their respective functional currency rates prevailing
at the date of the transaction. At the end of each reporting
period, foreign currency monetary items are retranslated
at the functional currency spot exchange rate in effect
at the reporting date. The resulting foreign currency
exchange differences are recorded in the statement of
income with the exception of differences that arise on
monetary items that provide an effective hedge for a net
investment in a foreign operation (such as intragroup
loans where settlement is neither planned nor likely to
occur in the foreseeable future). These are recognized in
other comprehensive income until the disposal of the net
investment, at which time they are recognized in the income
statement. Tax charges and credits attributable to exchange
differences on those monetary items are also recorded in
other comprehensive income.
Non-monetary items that are measured in terms of
historical cost in a foreign currency are translated using the
exchange rates as of the date of the initial transaction. Non-
monetary items measured at fair value in a foreign currency
are translated using the exchange rates at the date when
the fair value is determined.
Foreign operations
The assets and liabilities of foreign operations are translated
into euros at the rate of exchange prevailing at the
reporting date and their income statements are translated
at average exchange rates for the period. The exchange
differences arising on the translation are recognized in other
comprehensive income. On disposal of a foreign operation,
the component of other comprehensive income relating
to that particular foreign operation is recognized in the
income statement.
Any goodwill arising on the acquisition of a foreign
operation and any fair value adjustments to the carrying
amounts of assets and liabilities arising on the acquisition
are treated as assets and liabilities of the foreign operation
and translated at the closing rate.
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Income tax
Taxes shown in the consolidated statement of income
include income taxes to be paid on the basis of local tax
legislations, tax adjustments from previous years as well
as the effect of the annual change in the deferred tax
balances. Taxes are calculated using rates enacted or
substantively enacted at the balance sheet date.
Deferred tax liabilities and deferred tax assets are
calculated on all temporary differences arising between
the tax basis and the book value of assets and liabilities.
Deferred tax is not recognized for non-deductible
goodwill on initial recognition and temporary differences
in investments in subsidiaries to the extent that they
probably will not reverse in the foreseeable future.
The main temporary differences arise from unused tax
losses, depreciation differences, provisions, defined
benefit pension plans, inter-company inventory margin
and derivative financial instruments. In connection with
an acquisition, the Group records provisions for deferred
taxes on the difference between the fair values of the
net assets acquired and their tax bases. A deferred tax
asset is recognized to the extent that it is probable that
it can be utilized.
Business combinations
Acquisitions of subsidiaries are accounted for using the
acquisition method according to which the acquired
company’s identifiable assets, liabilities and contingent
liabilities are measured at fair value on the date of
acquisition. The excess of the consideration transferred
for the business combination over the acquirer’s interest
in the net fair value of the identifiable assets, liabilities
and contingent liabilities is recorded as goodwill. For each
acquisition the non-controlling interest in the acquiree, if
any, can be recognized either at fair value or at the non-
controlling interest’s proportionate share of the acquiree’s
net assets. If the purchase consideration is less than the fair
value of the Group’s share of the net assets acquired, the
difference is recognized directly through the profit and loss.
Direct acquisition transaction costs are expensed as incurred.
Assets held for sale
The Group classifies non-current assets and disposal
groups as held for sale if their carrying amounts will
be recovered principally through a disposal rather than
through the continuing use. Such non-current assets and
disposal groups classified as held for sale are measured at
the lower of their carrying amount and fair value less costs
to sell.
The criteria for held for sale classification is regarded as
met only when the sale is highly probable, and the asset
or disposal group is available for immediate disposal in its
present condition. Actions required to complete the disposal
should indicate that it is unlikely that significant changes
to the disposal will be made or that the decision to dispose
will be withdrawn. Management must be committed to the
disposal expected within one year from the date of the
classification.
Property, plant and equipment and intangible assets are not
depreciated or amortized once classified as held for sale.
Intangible assets
Intangible assets include service contracts, patents
and trademarks as well as software licenses and
implementation costs. Intangible assets acquired
separately are measured on initial recognition at cost.
The cost of intangible assets acquired in a business
combination is their fair value at the date of acquisition.
Intangible assets with definite useful life are amortized
on the straight-line basis over expected useful lives,
which may vary from 5 to 20 years with service contracts
and patents and trademarks and from 4 to 7 years with
software licenses. They are assessed for impairment
whenever there is an indication that the intangible asset
may be impaired.
Intangible assets with indefinite useful life are not
amortized, but they are tested annually for
impairment in a manner equivalent to that for testing
goodwill. The assessment of indefinite life is reviewed
annually to determine whether the indefinite life
continues to be supportable. If not, the change in
useful life from indefinite to finite is made on a
prospective basis.
Impairment testing of goodwill
Goodwill acquired in a business combination is tested for
impairment annually or whenever events or changes in
circumstances indicate that the carrying amount may not
be recoverable. For the purpose of impairment testing,
goodwill acquired in a business combination is, from the
acquisition date, allocated to each of the Group’s cash
generating units that are expected to benefit from the
combination, irrespective of whether other assets or
liabilities of the acquiree are assigned to those units. If
the carrying amount for a CGU exceeds its recoverable
amount, an impairment loss equal to the difference is
recognized. Konecranes uses a discounted cash flow
analyses to assess the fair value of goodwill. In assessing
value-in-use, the estimated future cash flows are
discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time
value of money and the risks specific to the asset. The
Group bases its impairment calculation on detailed budgets
and forecast calculations, which are prepared separately
for each of the Group’s CGUs to which the individual assets
are allocated. These budgets and forecast calculations
cover a period of five years. A previously recognized
impairment loss on goodwill is not reversed even if there is
a significant improvement in circumstances having initially
caused the impairment.
Property, plant and equipment
Property, plant and equipment are stated at cost less
accumulated depreciation and any impairment losses.
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Depreciation is recorded on a straight-line basis over the
estimated useful economic life of the assets as follows:
• Buildings 10–40 years
• Machinery and equipment 3–10 years
No depreciation is recorded for land.
Improvements made for existing property, plant and
equipment that will provide future economic benefit are
capitalized and depreciated over the remaining useful life
of the asset.
For leased right-of-use assets please see the accounting
principles section for leases.
Impairment of assets subject to amortization
and depreciation
The carrying values of intangible assets subject to
amortization, property, plant and equipment and
investments in associates and joint ventures are reviewed
for impairment whenever events and changes in
circumstances indicate that the carrying amount of an asset
may not be recoverable. If such an indication exists, the
recoverable amount of the assets will be estimated.
The recoverable amount is the higher of the asset’s fair
value less selling costs and value in use which is the present
value of the cash flows expected from the asset’s use and
eventual disposal. An impairment loss is recognized in the
statement of income when the recoverable amount of an
asset is less than its carrying amount. Impairment losses
on these assets are reversed if their recoverable amounts
subsequently increase.
Valuation of inventories
Raw materials and supplies are valued at the acquisition
cost or, if lower, at the net realizable value. Net realizable
value is the estimated selling price in the ordinary course
of business, less estimated costs of completion and
the estimated costs necessary to make the sale. Semi-
manufactured goods are valued at variable production costs
including a share of production overheads based on normal
capacity. Work in progress of uncompleted orders includes
direct labour and material costs, as well as a proportion of
overhead costs related to production and installation. Raw
materials and supplies are valued using weighted average
cost or the first-in, first-out (FIFO) basis. The inventory
stock obsolescence provision is based on the best estimate
of slow-moving and obsolete inventory at the balance sheet
date. The estimates are based on frequent review and
evaluation of inventory ageing and composition.
Account and other receivables
Account and other receivables are initially recorded at
fair value after which they are subsequently measured at
amortised cost. Account receivables represent the Group’s
right to an amount of consideration that is unconditional
(i.e., only the passage of time is required before payment
of the consideration is due). The provision for doubtful
accounts is estimated based on the Group’s historical
credit loss experience adjusted with current conditions and
reasonable and supportable forecasts about the future.
The effect is recognized in the statement of income.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and
deposits with banks and other liquid investments that
are held for the purpose of meeting short-term cash
commitments that are readily convertible to a known amount
of cash and are subject to an insignificant risk of changes in
value as the instruments have a maturity of three months
or less from the date of acquisition. Bank overdrafts are
included in current interest-bearing liabilities.
Fair value measurement
Fair value is the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction
between market participants. The Group categorizes
assets and liabilities measured at fair value into one of
three levels depending on the ability to observe inputs
employed in their measurement. Level 1 inputs are
quoted prices in active markets for identical assets or
liabilities. Level 2 inputs are inputs that are observable,
either directly or indirectly, other than quoted prices
included within level 1 for the asset or liability. Level 3
inputs are unobservable inputs for the asset or liability
reflecting significant modifications to observable related
market data or Konecranes’ assumptions about pricing by
market participants.
Derivative financial instruments and hedge accounting
The Group’s global operations expose it to currency risk and
to a lesser extent interest rate risk.
The Group uses derivative financial instruments, primarily
forward contracts and interest rate swaps, to hedge its
risks associated with foreign currency fluctuations relating
to certain commitments and forecasted transactions and
interest rate risks. Derivative financial instruments are
used for hedging purposes in accordance with the Group’s
hedging policy and not for speculative purposes. These
instruments are initially recognized at fair value at the
derivative contract date and are re-measured to fair value
at subsequent reporting dates. Derivatives are presented
as financial assets when the fair value is positive and as
financial liabilities when the fair value is negative.
For certain large crane projects, the Group applies hedge
accounting. The Group designates hedges of the foreign
currency risk of firm commitments and highly probable
forecasted transactions to a cash flow hedge. Changes in
the fair value of derivative financial instruments that are
designated as effective hedges of future cash flows are
recognized directly in other comprehensive income, while
the ineffective portion is recognized immediately in the
income statement. See note 34.
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Amounts recognized as OCI are transferred to profit or
loss when the hedged transaction affects profit or loss,
such as when the hedged financial income or financial
expense is recognized or when a forecast sale occurs.
When the hedged item is the cost of a non-financial asset
or non-financial liability, the amounts recognized as OCI
are transferred to the initial carrying amount of the non-
financial asset or liability.
If the hedging instrument expires or is sold, terminated
or exercised without replacement or rollover (as part of
the hedging strategy), or if its designation as a hedge
is revoked, or when the hedge no longer meets the
criteria for hedge accounting, any cumulative gain or
loss previously recognized in OCI remains separately in
equity until the forecast transaction occurs or the foreign
currency firm commitment is met. If a hedged transaction
is no longer expected to occur, the net cumulative gain
or loss recognized in the other comprehensive income is
transferred to profit or loss for the period.
Changes in the fair value of derivative financial instruments
that do not qualify for hedge accounting are recognized in
the statement of income as they arise.
The Group does not apply fair value hedging.
Financial assets
Financial assets are classified, at initial recognition, as
financial assets at fair value through profit or loss; financial
assets at fair value through OCI; or financial assets at
amortized cost. Financial assets are classified according
to their cash flow characteristics and the business model
they are managed in. Trade day accounting is applied
to regular purchases and sales of financial assets. They
include account and other receivables, interest bearing
investments and derivative financial instruments. The
subsequent measurement of financial assets depends on
their classification, as follows:
Financial assets at amortized cost
Financial assets at amortized cost are subsequently
measured using the effective interest rate method. Account
receivables and other receivables are recognised at their
anticipated realisable value which is the original invoice
amount less an estimated provision for doubtful accounts
for impairment. The increase in the credit risk for financial
assets measured at amortised cost is assessed at the end of
the reporting period. The credit loss allowance is estimated
based on the Group’s historical credit loss experience
adjusted with current conditions and reasonable and
supportable forecasts about the future. The Group applies
the simplified approach to record expected credit losses on
its accounts receivable by using a provision matrix where
accounts receivable is grouped based on different customer
bases and different historical loss patterns.
Financial assets at fair value through profit or loss
Interest-bearing investments, which are non-derivative
financial assets and have fixed or determinable payments and
are not quoted on active markets, are measured at fair value
through the statement of income. This category also includes
derivatives that are not qualifying for hedge accounting.
Financial assets at fair value through other
comprehensive income
Derivatives that are qualifying for hedge accounting are
classified as financial assets at fair value through other
comprehensive income. The treatment of gains and
losses arising from revaluation is described above in the
accounting policy for derivative financial instruments and
hedge accounting.
Financial liabilities
Financial liabilities are classified as financial liabilities at
fair value through profit or loss; financial liabilities at fair
value through other comprehensive income; or as financial
liabilities measured at amortized cost, as appropriate.
Financial liabilities include trade and other payables, finance
debt and derivative financial instruments. The Group
determines the classification of its financial liabilities at
initial recognition. The measurement of financial liabilities
depends on their classification, as follows:
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss are
carried on the balance sheet at fair value with gains or losses
recognized in the income statement. Derivatives, other than
those designated as effective hedging instruments, are
classified as held for trading and are included in this category.
Financial liabilities at fair value through other
comprehensive income
These financial liabilities are typically derivatives designated
for hedge accounting and are carried on the balance sheet
at fair value. The treatment of gains and losses arising from
revaluation is described above in the accounting policy for
derivative financial instruments and hedge accounting.
Financial liabilities measured at amortized cost
All other financial liabilities are initially recognized at fair
value. For interest-bearing loans and borrowings this is
the fair value of the proceeds received net of issue costs
associated with the borrowing. After initial recognition,
other financial liabilities are subsequently measured
at amortized cost using the effective interest method.
Amortized cost is calculated by taking into account any
issue costs, and any discount or premium on settlement.
Gains and losses arising on the repurchase, settlement
or cancellation of liabilities are recognized respectively in
interest and other finance income and finance costs. This
category of financial liabilities includes accounts payables
and interest-bearing liabilities.
Offsetting of financial instruments
Financial assets and financial liabilities are offset, and the
net amount reported in the consolidated statement of
financial position if, and only if, there is a currently existing,
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legally enforceable, unconditional right of offset that applies
to all counterparties of the financial instruments in all
situations, including both normal operations and insolvency.
Derecognition of financial instruments
Financial assets are derecognized when the rights to
receive cash flows from the assets have expired or the
Group has transferred its rights to receive cash flow; and
either the Group has transferred substantially all the risks and
rewards of the assets, or the Group has neither transferred
nor retained substantially all the risks and rewards of the
assets but has transferred the control of the assets.
Financial liability is derecognized when the obligation
is discharged or cancelled or expires. When an existing
financial liability is replaced by another from same lender
on substantially different terms, or terms of existing
loan are substantially modified, such an exchange or
modification is accounted for as an extinguishment of
the original liability and the recognition of a new financial
liability. The difference between the respective carrying
amounts is recognised in the income statement.
Provisions
Provisions are recognized in the balance sheet when the
Group has a present legal or constructive obligation as a
result of a past event and it is considered probable that
an outflow of resources embodying economic benefits
will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation.
Provisions may arise from restructuring plans, onerous
contracts, guarantees and warranties, among other events.
Obligations arising from restructuring plans are recognized
when the detailed and formal restructuring plans have been
established, the personnel concerned have been informed
and when there is a valid expectation that the plan will
be implemented. The warranty provision is based on the
history of past warranty costs and claims on delivered
products under warranty. Additionally, warranty provisions
can be established on a case by case basis to take into
consideration the potentially increased risks.
When the Group expects some or all of a provision to be
reimbursed, for example, under an insurance contract, the
reimbursement is recognized as a separate asset, but only
when the reimbursement is virtually certain.
Leases
The Group assesses at contract inception whether a
contract is, or contains, a lease. That is, if the contract
conveys the right to control the use of an identified asset
for a period of time in exchange for consideration.
The Group as a lessee
The Group applies a single recognition and measurement
approach for all leases, except for short-term leases and
leases of low-value assets. The Group recognizes lease
liabilities to make lease payments and right-of-use assets
representing the right to use the underlying assets.
Right-of-use assets
The Group recognizes right-of-use assets at the
commencement date of the lease (i.e. asset is available
for use). Right-of-use assets are measured at cost less
any accumulated depreciation and impairment losses and
adjusted for any remeasurement of lease liabilities. The cost
of right-of-use assets includes the amount of lease liabilities
recognized, possible initial cost incurred, lease payments
done before the commencement date and less any lease
incentives received. The recognized right-of-use assets are
mainly rentals of premises and vehicles which are typically
depreciated on a straight-line basis over the shorter of the
lease term and estimated useful life of the asset. Right-
of-use assets are subject to possible impairment.
Lease liabilities
At the commencement date of a lease the Group recognizes
lease liabilities measured at the present value of the lease
payments to be made over the lease term. The lease
payments include fixed payments less any lease incentives,
variable lease payments that depend on an index or a rate
and amounts expected to be paid under residual value
guarantees. The variable lease payments that do not
depend on an index or a rate are recognized as expense
in the period on which the event or condition that triggers
the payment occurs. In calculating the present value
of the lease payments, the group uses the incremental
borrowing rate at the lease commencement date if the
interest rate implicit in the lease is not determinable. After
the commencement date, the amount of lease liabilities is
increased to reflect the accretion of interest and reduced for
the lease payments made. In addition, the carrying amount
of lease liabilities is remeasured if there is a modification,
a change in lease term, a change in the fixed lease
payments or a change in the assessment to purchase the
underlying asset.
Short-term leases and leases of low-value assets
The Group applies the short-term lease recognition
exemption to its short-term leases of machinery and
equipment (i.e. those leases that have a lease term of 12
months or less from the commencement date and do not
contain a purchase option). It also applies the recognition
exemption to equipment that are considered of low value.
Lease payments on short term leases and leases of low value
assets are recognized as an expense over the lease term.
Judgment in determining the lease term
The Group has various lease agreements for office
equipment, vehicles and premises with varying terms and
renewal rights. The Group determines the lease term as the
non-cancellable term of the lease together with any periods
covered by an option to extend or early terminate the
lease if it is reasonably certain to be exercised. The Group
uses judgment especially for the use of extension options
as well as when defining the lease term for open end
lease agreements so that they are based on the business
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requirements, factors that create an economic incentive and
real estimated useful lifetime of the underlying asset.
Cash flow statement
The cash flow statement has been prepared in accordance
with the indirect method. In the cash flow statement a
distinction is made between cash flows from operating,
investing and financing activities. Currency differences
on cash and cash equivalents are recognized separately
in the cash flow statement. Revenue and expenses for
income tax are recognized under Cash flows from operating
activities. Interest costs and interest revenues are recognized
under Cash flows from operating activities. Cash flows as
a result of the acquisition or disposal of financial interests
(subsidiaries and interests) are recognized under Cash flows
from investing activities, taking into account the cash, cash
equivalents and repaid third party debts present in these
interests. Dividends paid out, as well as obtained and repaid
loans, are recognized under Cash flows from financing
activities.
2.4. Application of new and amended IFRS
standards and IFRIC interpretations
The relevant new or revised IFRSs that Konecranes has
adopted from January 1, 2022 were the following:
Annual Improvements to IFRS Standards 2018-2020:
Improvement in IFRS 9, Financial Instruments, clarifies
that when assessing if a modification of a financial liability
results in a modification of an existing debt instrument
or recognition of a new one, the entity should prepare
a present value test of the cash flows related to financial
liability before and after modification including fees paid and
received between the lender and borrower.
Reference to the Conceptual Framework amends IFRS 3
Business combinations. The amendments update the
reference to the 2018 Conceptual Framework, as well as
add an exception to the recognition principle for liabilities
and contingent liabilities within the scope of IAS 37 or
IFRIC 21. In addition, the amendments add clarification
on the prohibition to recognize contingent assets at the
acquisition date.
Amendments to IAS 16, Property, Plant, and Equipment:
Proceeds before Intended Use, the amendment clarifies how
to account for sales proceeds when items are produced and
while an item of property, plant, and equipment is brought
to the location and condition necessary for it to be capable
of operating in the manner intended by management.
In accordance with the clarification, such proceeds should
be reported as revenues and not as a reduction of costs.
Amendments to IAS 37, Onerous Contracts - Cost of
Fulfilling a Contract. The amendments specify which
costs an entity needs to include when assessing whether
a contract is loss-making. These costs relate directly to
the contract such as labor and materials and allocation
of other costs that relate directly to fulfilling the contract
such depreciation charge related to property, plant, and
equipment used in fulfilling the contract.
None of these amendments for IFRS standards had
significant impact to the financial statements of Konecranes.
New and amended standards issued applicable from
January 1, 2023, but not yet effective are disclosed below.
The Group adopts new and amended standards and
interpretations, if applicable, when they become effective.
Amendments to IAS 1 – Classification of Liabilities as Current
or Non-current, the amendment specifies the requirements
for classifying liabilities as current or non-current.
Disclosure of Accounting Policies – Amendments to IAS 1
and IFRS Practice Statement 2, The amendment replaces the
requirement to disclose significant accounting policies with
a requirement to disclose material accounting policies. The
amendment aims to help companies to disclose accounting
policies, which are material for users to understand the
information in the company’s financial statements.
Amendments to IAS 12 – Deferred Tax Related to
Assets and Liabilities Arising from a Single Transaction,
the amendment clarifies deferred tax accounting for
transactions and events, such as leases that lead to the
initial recognition of both an asset and a liability. The
amendments require companies to recognize a separate
deferred tax asset and deferred tax liability when the
temporary differences arising on the initial recognition of an
asset and a liability are equal.
New or amended standards, improvements or annual
improvements applicable from January 1, 2023 or later do
not have significant effect for the Group.
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3. Segment information
For management purposes, the Group is organized into
business units based on its products and services and had
three reportable segments in 2022 and 2021: Service,
Industrial Equipment and Port Solutions.
The Service segment provides maintenance and installation
Service segment provides maintenance and installation
services of industrial equipment, the Industrial Equipment
segment produces industrial cranes and their components
to variety of industries and the Port Solutions segment
produces lifting equipment for ports and provides services
for port equipment.
Some business units have been aggregated to form the
above reportable operating segments due to the similar
economic characteristics with respect to the nature of the
production process, product type and class of customers
for their products.
The above reportable segments are based on the Group’s
management reporting and organizational structure.
Konecranes Group’s chief operating decision maker is the
Board of Directors.
Segment performance is evaluated based on profit or
loss and is measured consistently with profit or loss in
the consolidated financial statements. However, the
performance of the investees accounted for using the equity
method is evaluated using proportionate consolidation.
The assets and liabilities of the reportable segments include
only items directly connected with the business as well as
the goodwill related to them. Taxes and financial income
and expenses are managed on Group level and are not
allocated to segments.
Konecranes reports also three geographical areas, which
are the main market areas: EMEA (Europe, Middle East and
Africa), AME (Americas) and APAC (Asia-Pacific). Sales are
reported by the customer location and assets and capital
expenditure by the location of the assets.
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3.1. Operating segments
Service Industrial Equipment Port Solutions
Corporate functions
and unallocated Eliminations Total
2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
Sales
Sales to external customers 1,292.8 1,161.3 1,068.8 960.2 1,003.2 1,064.3 0.0 0.0 3,364.8 3,185.7
Inter-segment sales 50.6 44.0 136.8 128.5 11.9 8.6 9.8 9.2 -209.0 -190.3 0.0 0.0
Total sales 1,343.3 1,205.3 1,205.6 1,088.7 1,015.0 1,072.9 9.8 9.2 -209.0 -190.3 3,364.8 3,185.7
Adjusted EBITA 249.4 222.4 32.5 38.0 63.5 79.9 -27.1 -28.1 0.1 0.0 318.4 312.2
% of net sales 18.6% 18.5% 2.7% 3.5% 6.3% 7.4% 9.5% 9.8%
Purchase price allocation amortization -14.3 -15.5 -11.0 -10.8 -6.6 -6.8 -31.8 -33.2
Adjusted operating profit 235.2 206.9 21.5 27.2 57.0 73.1 -27.1 -28.1 0.1 0.0 286.6 279.1
% of net sales 17.5% 17.2% 1.8% 2.5% 5.6% 6.8% 8.5% 8.8%
Adjustments to operating profit
Transaction and integration costs -0.1 -8.6 -47.8 -8.7 -47.8
Restructuring costs -2.6 -2.0 -12.9 -8.5 -0.6 1.7 -0.9 -2.5 -17.0 -11.3
Costs related to the impacts of the war in Ukraine -0.4 0.0 -19.6 0.0 -17.8 0.0 -0.1 0.0 -37.8 0.0
Total -2.9 -2.0 -32.5 -8.5 -18.6 1.7 -9.5 -50.3 -63.5 -59.1
Operating profit 232.3 204.9 -10.9 18.7 38.4 74.8 -36.6 -78.4 0.1 0.0 223.2 220.0
% of net sales 17.3% 17.0% -0.9% 1.7% 3.8% 7.0% 6.6% 6.9%
Share of associates and joint ventures result
(note 16)
0.4 0.3 0.4 0.3
Financial income 26.9 28.6 26.9 28.6
Financial expenses -59.7 -56.4 -59.7 -56.4
Profit before tax 190.7 192.5
Segment assets 1,502.5 1,422.6 1,112.0 926.6 1,070.0 900.4 3,684.5 3,249.6
Investment accounted for using the equity
method (note 16)
7.8 6.8 7.8 6.8
Cash and cash equivalents 413.9 320.7 413.9 320.7
Deferred tax assets 103.8 120.2 103.8 120.2
Income tax receivables 15.0 16.2 15.0 16.2
Other unallocated and corporate function
level assets
115.6 132.4 115.6 132.4
Total assets 1,502.5 1,422.6 1,112.0 926.6 1,070.0 900.4 656.1 596.2 4,340.6 3,845.8
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Revenue expected to be recognized in the future periods related to performance obligations
that are unsatisfied or partially unsatisfied
Service Industrial Equipment Port Solutions
Corporate functions
and unallocated Eliminations Total
2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
Segment liabilities 252.5 212.7 503.3 376.6 539.3 405.8 1,295.2 995.1
Interest-bearing liabilities 1,106.2 865.1 1,106.2 865.1
Deferred tax liabilities 133.7 142.6 133.7 142.6
Income tax payables 31.7 23.0 31.7 23.0
Other unallocated and corporate function level
liabilities
340.9 459.5 340.9 459.5
Total liabilities 252.5 212.7 503.3 376.6 539.3 405.8 1,612.4 1,490.2 2,907.6 2,485.2
Other disclosures
Capital expenditure 8.9 10.9 20.9 28.8 7.3 10.2 0.0 0.0 37.0 49.8
Personnel 7,802 7,890 5,529 5,516 3,102 3,083 89 84 16,522 16,573
During 2023 During 2024 From 2025 onwards Total
Service 397.3 18.4 29.9 445.5
Industrial Equipment 701.3 117.0 38.9 857.2
Port Solutions 1,015.6 514.3 69.0 1,599.0
Total 2,114.2 649.7 137.8 2,901.7
The transaction price associated with unsatisfied or partially
unsatisfied performance obligations does not include
variable consideration that is constrained. The Group total
revenue will also include new orders, scope changes and
contract extensions which are not known at reporting date
and thus are excluded in this table.
3.1. Operating segments (continued)
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3.2. Geographical areas
2022 EMEA* AME APAC Total
External sales* 1,714.1 1,201.1 449.7 3,364.8
Assets* 3,052.7 643.6 644.3 4,340.6
Capital expenditure 27.2 3.6 6.3 37.0
Personnel 9,565 3,131 3,826 16,522
2021 EMEA* AME APAC Total
External sales* 1,645.9 1,042.2 497.7 3,185.7
Assets* 2,637.8 546.1 661.9 3,845.8
Capital expenditure 36.4 1.0 12.4 49.8
Personnel 9,683 3,016 3,874 16,573
* External sales to Finland EUR 102.8 million. Non-current assets (excluding deferred tax assets) in Finland: EUR 175.6 million and in other
countries: EUR 1,692.0 million.
* External sales to Finland EUR 87.6 million. Non-current assets (excluding deferred tax assets) in Finland: EUR 172.8 million and in other
countries: EUR 1,710.2 million.
There are no single customers which have over 10% of Group’s sales.
4. Acquisitions and divestments
Acquisitions
In July 2022, Konecranes acquired a small crane service
business of Garabi Industrial Technologies in Spain and
paid EUR 1.5 million as purchase price for the acquired
assets. The fair values of the acquired business were EUR
1.6 million for Intangible assets (clientele), EUR 0.1 million
for Property, plant and equipment, EUR 0.3 million for
Inventories and EUR 0.4 million for Deferred tax liability. If
the business had been acquired on January 1, 2022, the
full year sales 2022 of the acquiree would have been EUR
3,365.9 million and EBIT EUR 223.2 million.
Acquisitions of non-controlling interests
In September 2022, Konecranes acquired the non-
controlling interest of 6% of Konecranes Real Estate
GmbH & Co. KG in Germany and paid EUR 2.7 million as
purchase price.
In November 2022 Konecranes became the sole owner and
provider of TBA software products by acquiring the non-
controlling interest of 30.22% of Ports Sofware Solutions
B.V. in the Netherlands. TBA Group provides software as
well as port planning and optimizing consultancy services
in the ports, intermodal and warehousing sectors. The
acquisition price was EUR 8.0 million of which EUR 5.0
million was paid in cash and EUR 3.0 million was recorded
as deferred purchase price. At the same time the TBA design
consultancy operations were transferred to a new legal entity
of which Konecranes Group now owns 49%. The total effect
from these acquisitions was EUR -4.8 million in retained
earnings and EUR -6.5 million in non-controlling interest.
Divestments
In September 2022 Konecranes divested from the Port
Solutions segment the small automation business Motronica
in Italy. Konecranes received proceeds of EUR 0.4 million
and recorded EUR 0.4 million pre-tax profit from the
transaction. Between September and December Konecranes
also divested the service business in Russia and received
proceeds of EUR 0.3 million and recorded EUR 0.4 million
pre-tax loss from the transactions.
Acquisitions and divestments in 2021
There were no acquistions or divestments during 2021.
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5. Disaggregation of revenue in sales
Customer contract revenue 2022 2021
Sale of goods 2,308.4 2,242.4
Rendering of services 1,047.1 936.1
Total customer contract revenue 3,355.5 3,178.5
Other revenue
Leasing of own products 8.9 6.9
Royalties 0.4 0.4
Total other revenue 9.3 7.3
Total sales 3,364.8 3,185.7
2022 2022 2022 2021 2021 2021
Timing of satisfying performance
obligations by Segments
At a point
of time
Over
time Total
At a point
of time
Over
time Total
Service 165.3 1,127.5 1,292.8 150.1 1,011.2 1,161.3
Industrial Equipment 882.5 165.1 1,047.6 778.8 181.4 960.2
Port Solutions 877.6 146.8 1,024.4 836.4 227.9 1,064.3
Corporate functions 0.0 0.0 0.0 0.0 0.0 0.0
Total 1,925.4 1,439.4 3,364.8 1,765.3 1,420.5 3,185.7
6. Contract balances
6.1. Contract assets and liabilities
6.2. Advances received
Contract assets 2022 2021
The cumulative revenues
of non-delivered projects
641.3 682.8
Advances received netted 457.9 521.5
Total 183.5 161.3
Transfers to receivables from contract
assets recognized at the
beginning of period
303.2 220.3
Contract liabilities
Gross advance received from
percentage of completion method
572.2 593.8
Advances received netted 457.9 521.5
Total 114.3 72.3
Revenue recognised in the current
period that was included in the
contract liability opening balance
257.4 185.8
Increases due to cash received 284.0 306.5
2022 2021
Advance received from percentage
of completion method (netted)
114.3 72.3
Other advance received
from customers
450.1 272.4
Total 564.3 344.7
Contract assets relate to receivable arising from percentage
of completion method. Net asset balances are balances
where the sum of contract costs, recognized profits and
recognized losses exceed progress billings. Where progress
billings exceed the sum of contract costs, recognized profits
and recognized losses these liabilities are included in the line
item contract liabilities.
See note 3 for revenue expected to be recognized in the future
periods related to performance obligations that are unsatisfied
or partially unsatisfied and note 21 for unbilled revenue.
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7.1. Audit and non-audit fees to Group auditor
7. Operating Expenses
8. Personnel expenses
and number of personnel
8.1. Personnel expenses
8.2. Number of personnel
8.3. Personnel by Reportable Segment
at the end of period
2022 2021
Audit 4.1 3.8
Non-audit services 0.2 0.3
Total 4.3 4.0
2022 2021
Change in work in progress -170.9 -35.0
Production for own use -1.1 -0.7
Material and supplies 1,267.5 1,030.7
Subcontracting 414.7 418.1
Materials, supplies and subcontracting 1,510.2 1,413.0
Wages and salaries 884.8 829.6
Pension costs 66.9 65.1
Other personnel expenses 140.2 128.8
Personnel cost 1,091.9 1,023.5
Other operating expenses 423.3 420.4
Total operating expenses 3,025.3 2,856.9
2022 2021
Wages and salaries 884.8 829.6
Pension costs: Defined benefit plans 9.5 10.7
Pension costs: Defined
contribution plans
57.5 54.5
Other personnel expenses 140.2 128.8
Total 1,091.9 1,023.5
2022 2021
Average number of personnel 16,563 16,625
Number of personnel as
at December 31
16,522 16,573
Number of personnel as
at December 31 in Finland
2,151 2,065
2022 2021
Service 7,802 7,890
Industrial Equipment 5,529 5,516
Port Solutions 3,102 3,083
Group Staff 89 84
Total 16,522 16,573
Research and development costs recognized as an expense
in the statement of income amount to EUR 47.7 million in
the year 2022 (EUR 47.7 million in 2021).
9. Depreciation, amortization
and impairments
9.1. Depreciation and amortization
9.2. Impairments
2022 2021
Intangible assets 38.0 44.2
Buildings 31.4 30.7
Machinery and equipment 45.7 45.0
Total 115.2 119.8
2022 2021
Property, plant and equipment 5.3 0.3
Goodwill 3.9 0.0
Total 9.2 0.3
The nature of the impairments is described in the
disclosures of goodwill, intangible assets and property, plant
and equipment (see notes 13, 14 and 15).
10. Financial income and expenses
10.1. Financial income
2022 2021
Interest income on bank deposits
and loans
6.1 2.1
Exchange rate gains 20.4 25.6
Other financial income 0.4 0.9
Total 26.8 28.6
10.2. Financial expenses
2022 2021
Interest expenses on liabilities 26.5 19.0
Net loss on financial instruments
at fair value through profit or loss
27.2 30.8
Other financial expenses 6.0 6.6
Total 59.7 56.4
Financial income
and expenses net
-32.9 -27.8
The company applies hedge accounting on derivatives
used to hedge cash flows in certain large crane projects.
The cash flow hedges of the expected future cash flows
are assessed to be highly effective and a net unrealized
effect of EUR +2.0 million (2021: EUR -11.0 million)
with deferred taxes of EUR -0.4 million (2021: EUR +2.2
million) relating to the hedging instruments is included
in equity. The hedged operative cash flows are expected
to occur during the next 3–18 months. The realized and
recycled currency differences from these hedges recorded
in the statement of income were EUR -17.8 million in 2022
(EUR -0.4 million in 2021).
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11. Income taxes
11.1. Taxes in statement of income
11.2. Reconciliation of income before taxes
with total income taxes
11.3. Tax effects of components in other
comprehensive income
2022 2021
Local income taxes of group
companies
63.8 47.7
Taxes from previous years -0.6 1.4
Change in deferred taxes -11.0 -3.9
Total 52.2 45.1
2022 2021
Cash flow hedges -0.4 -2.2
Re-measurement gains (losses)
on defined benefit plans
-18.7 5.8
Total -19.1 3.6
2022 2021
Profit before taxes 190.7 192.5
Tax calculated at the domestic corpora-
tion tax rate of 20.0% (2021: 20.0%)
38.1 38.5
Effect of different tax rates of foreign
subsidiaries
16.0 10.2
Taxes from previous years -0.6 1.4
Tax effect of non-deductible expenses
and tax-exempt income
0.1 -1.2
Tax effect of unrecognized tax losses
of the current year
2.4 0.6
Tax effect of utilization of previously
unrecognized tax losses
-4.0 -4.6
Tax effect of recognition of previously
unrecognized tax losses
-2.2 -0.3
Tax effect of impairment of previously
recognized deferred tax assets
1.7 -1.1
Tax effect of recognizing the controlled
temporary difference from investment
in subsidiaries
-1.8 2.4
Tax effect of tax rate change -0.1 0.2
Other items 2.5 -1.0
Total 52.2 45.1
Effective tax rate % 27.4% 23.4%
The company evaluates regularly the net realizable value of
its deferred tax assets.
12. Earnings per share
Basic earnings per share are calculated by dividing the
net income attributable to the shareholders of the parent
company by the weighted average number of shares
outstanding during the year. Diluted earnings per share are
calculated by adjusting the weighted average number of
shares outstanding during the year for the dilutive effect
of the shares issued under the share based incentive
plans. Weighted average number of shares is excluding the
number of treasury shares.
2022 2021
Net profit attributable to shareholders
of the parent company
140.3 146.9
Weighted average number of shares
outstanding (1,000 pcs)
79,152 79,134
Effect of share based incentive plans
(1,000 pcs)
357 473
Weighted average number of shares
outstanding, diluted (1,000 pcs)
79,508 79,607
Earnings per share, basic (EUR) 1.77 1.86
Earnings per share, diluted (EUR) 1.77 1.85
13. Goodwill and goodwill
impairment testing
13.1. Goodwill
2022 2021
Acquisition costs as of January 1 1,036.8 1,031.4
Translation difference 1.5 5.4
Acquisition costs as of December 31 1,038.3 1,036.8
Accumulated impairments as of
January 1
-14.7 -14.7
Impairments for the financial year -3.9 0.0
Total as of December 31 1,019.6 1,022.1
13.2. General principles
Management monitors the performance of the Group
through the monthly meetings and monthly reporting that
take place on a business unit level. Impairment testing is
done at the lowest level of the Group at which goodwill is
monitored internally.
13.3. Total goodwill in reportable segments
after impairments
2022 2021
Industrial Cranes 153.7 154.0
Agilon 0.0 3.9
Goodwill in Industrial
Equipment total
153.7 157.9
Industrial Crane Service 662.9 660.0
Machine Tool Service 3.9 4.1
Goodwill in Service total 666.8 664.1
Port Cranes 163.3 163.4
Lift trucks 35.8 36.7
Goodwill in Port Solutions total 199.1 200.0
Total goodwill in reportable
segments as of December 31
1,019.6 1,022.1
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Compound
annual
growth rate
Discount
rate
Industrial Cranes 4.0% 14.6%
Agilon 13.8% 14.5%
Industrial Crane Service 7.5% 15.2%
Machine Tool Service 4.5% 13.3%
Lift trucks 9.9% 12.7%
Port Cranes 6.5% 13.8%
The recoverable amounts of the CGUs are determined
based on value in use calculations using the discounted
cash flow method. The forecasting period of cash flows
is five years and it is based on financial forecasts of the
management responsible for that CGU, and adjusted by
Group management if needed. Cash flows beyond the
five-year period were calculated using the terminal value
method. The forecasts have been made based on the CGU
specific historical data, order book, the current market
situation and industry specific information of the future
growth possibilities. The present increase of cost inflation is
considered to be covered mostly by the increases in sales
prices while on the long-term cost inflation is expected to
return back to a lower level. The productivity and efficiency
assumptions are based on internal targets, which are
evaluated against actual performance. These assumptions
are reviewed annually as part of management’s annual
planning and strategic planning cycles. Calculations are
prepared during the fourth quarter of the year.
The discount rate applied to cash flow projections is the
weighted average (pre-tax) cost of capital and is based on
risk-free long-term government bond rates and market and
industry specific risk premiums. These risk premiums are
derived based on the business portfolio of companies which
operate in a similar industry.
The key assumptions, being the average compound annual
growth rate for the forecasted sales of the five years and
the discount rate are as follows:
Impairment charges
Konecranes impaired the goodwill of Agilon Cash Generating
Unit due to decreased discounted cash flow projections.
Agilon is an automated storage and retrieval system
designed especially for maintenance, production and
distribution operations and warehouse management. The
development of the sales has not met the targets and
consequently the cash flows have been insufficient. The
business is partially based on a rental model, which employs
capital. The Agilon business operates mainly in region
Europe and belongs to Industrial Equipment segment.
According to the goodwill test, the recoverable amount of
the unit is EUR 2.4 million, which is based on its value in
use calculations. The discount rate used for the calculation
was 14.5% (13.2% on December 31, 2021).
The impairment testing performed in 2021 did not result in
any impairments being recognized.
Sensitivity analyses
In addition to impairment testing using the base case
assumptions, four separate sensitivity analyses were
performed for each CGU:
1) A discount rate analysis where the discount rate was
increased by 5% points.
2) A Group management adjustment to the future
profitability. The cash flow of each CGU was analyzed
by the Group management. Based on the CGU specific
historical data and future growth prospects the cash
flows were decreased by 10% in each year including
terminal year.
The average compound growth rate for the gross profit is
consistent with that of sales. Furthermore for all the CGUs a
1% terminal growth rate has been applied.
3) A higher discount rate (+5% points) analysis combined
with lower (-10%) cash flows as mentioned above.
4) A decrease in the compound annual growth rate
for the sales for each of the five forecasted years
(- 2% points) combined with the current discount rate.
2022
There was no indication of impairment of goodwill for
any other CGU than Agilon from the sensitivity tests.
The probability for material impairment losses is low for
the other CGUs in which under the basic scenario, the
calculated value in use was approximately two times higher
than the CGUs’ assets employed.
2021
Sensitivity tests using both higher discount rate
(+5% points) and lower cash flow estimates (-10%)
indicated that the goodwill in Agilon would have been
impaired by EUR 0.6 million. There was no indication
of impairment of goodwill for any other CGU from the
sensitivity tests.
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14. Intangible assets
2022
Patents
and trademarks Software Other
Intangible
assets total
Acquisition costs as of January 1 243.8 191.7 504.1 939.6
Additions 0.0 9.8 0.0 9.8
Disposals -0.3 -0.6 -1.1 -2.0
Business combinations 0.0 0.0 1.6 1.6
Transfer within assets 0.0 0.0 0.0 0.0
Translation difference 0.0 0.0 0.0 0.0
Acquisition costs as of December 31 243.5 200.9 504.6 949.0
Accumulated amortization as of
January 1
-19.5 -168.4 -248.5 -436.4
Translation difference 0.0 0.1 0.2 0.3
Accumulated amortization relating
to disposals
0.3 0.2 0.0 0.5
Amortization for financial year -1.4 -10.0 -26.5 -38.0
Total as of December 31 222.8 22.7 229.8 475.4
2021
Patents
and trademarks Software Other
Intangible
assets total
Acquisition costs as of January 1 243.7 180.2 504.8 928.8
Additions 0.0 12.2 0.0 12.2
Disposals 0.0 -0.7 -1.3 -2.0
Transfer within assets 0.0 0.0 0.0 0.0
Translation difference 0.0 0.0 0.5 0.5
Acquisition costs as of December 31 243.8 191.7 504.1 939.6
Accumulated amortization as of
January 1
-17.7 -158.0 -217.0 -392.7
Translation difference 0.0 -0.1 -0.3 -0.4
Accumulated amortization relating
to disposals
0.0 0.7 0.2 0.9
Amortization for financial year -1.8 -11.1 -31.3 -44.2
Total as of December 31 224.2 23.3 255.6 503.1
The category Other consists mainly of customer lists
and technology acquired in business combinations. They
are stated at cost and amortized on a straight-line basis
over their expected useful lives. The normal amortization
period of intangible assets varies from 4 to 20 years.
The amortization of intangible assets is included in the
depreciation and impairments line in the consolidated
statement of income. On December 31, 2022 and December
31, 2021, the intangible assets having indefinite useful
life consisted of the Demag and Gottwald trademarks of
EUR 167.0 million and EUR 51.0 million. As there is no
foreseeable limit on the period over which the asset is
expected to generate net cash inflows for the entity, it is
classified as intangible assets having an indefinite useful life.
The carrying amounts of these assets are tested on a yearly
basis in connection with the goodwill impairment testing.
The addition of EUR 9.8 million (EUR 12.2 million in 2021)
mainly consisted of capitalized development costs of the
Group’s ERP systems.
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15. Property, plant and equipment
2022 Land Buildings
Machinery &
Equipment
Property,
plant and
equipment
total
Acquisition costs as of January 1 29.8 288.8 418.4 737.0
Additions 0.0 40.2 48.4 88.6
Disposals 0.0 -8.7 -15.0 -23.7
Transfer within assets -0.2 0.1 0.0 0.0
Impairment 0.0 -1.1 -3.6 -4.8
Translation difference 0.1 -0.2 0.6 0.5
Acquisition costs as of December 31 29.7 319.0 448.8 797.5
Accumulated depreciation as of
January 1
0.0 -113.0 -284.7 -397.7
Translation difference 0.0 0.3 0.4 0.7
Accumulated depreciation relating
to disposals
0.0 8.3 14.4 22.7
Depreciation for financial year 0.0 -31.4 -45.7 -77.2
Total as of December 31 29.7 183.1 133.1 345.9
2021 Land Buildings
Machinery &
Equipment
Property,
plant and
equipment
total
Acquisition costs as of January 1 30.1 263.3 391.6 685.0
Additions 0.0 30.9 43.0 74.0
Disposals -0.6 -10.6 -19.0 -30.2
Transfer within assets 0.0 0.4 -0.4 0.0
Impairment 0.0 0.0 -0.3 -0.3
Translation difference 0.3 4.8 3.3 8.5
Acquisition costs as of December 31 29.8 288.8 418.4 737.0
Accumulated depreciation as of
January 1
0.0 -88.3 -254.9 -343.2
Translation difference 0.0 -0.3 -0.4 -0.7
Accumulated depreciation relating
to disposals
0.0 6.3 15.6 21.9
Depreciation for financial year 0.0 -30.7 -45.0 -75.6
Total as of December 31 29.8 175.8 133.7 339.3
Classification of Property, plant and equipment 2022 2021
Property, plant and equipment, owned 213.5 223.8
Right-of-use assets, leased 132.5 115.6
Total 345.9 339.3
2022
Right of use assets
Land and
Buildings
Machinery and
Equipment Total
Balance as of January 1 76.5 39.1 115.6
Translation difference 0.3 0.6 0.9
New contracts and changes in lease contracts 36.0 23.5 59.6
Depreciation during the year -23.2 -20.3 -43.5
Total as of December 31 89.6 42.9 132.5
2021
Right of use assets
Land and
Buildings
Machinery and
Equipment Total
Balance as of January 1 78.5 42.5 121.0
Translation difference 2.0 1.4 3.4
New contracts and changes in lease contracts 18.1 15.6 33.6
Depreciation during the year -22.1 -20.4 -42.5
Total as of December 31 76.5 39.1 115.6
In impairments of Property, Plant and Equipment in 2022, EUR 1.6 million relate to the war in
Ukraine, EUR 2.9 million to restructuring actions and EUR 0.3 million to old rental assets, and in
2021 (EUR 0.3 million) to restructuring actions.
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16. Interests in other entities
and non-controlling interests
16.1. Investments accounted for using
the equity method
The following table illustrates the summarized financial information of the Group’s investments and reconciliation
with the carrying amount of the investments in consolidated financial statements.
16.3. Joint operations
Konecranes has classified the interest in AS Konesko
(domiciled in Estonia) as a joint operation based on the
joint arrangement agreement. AS Konesko is a strategic
supplier of components used in Konecranes products.
Konecranes has the exclusive right to purchase certain
motors and end carriages from AS Konesko at a price to be
agreed upon with AS Konesko. However Konecranes retains
ownership of the current motor designs and the trademark
rights to the end carriages.
Associated Companies 2022 2021
Acquisition costs as of January 1 1.7 1.7
Share of associated companies' result
after taxes*
0.1 0.1
Dividends received -0.1 -0.1
Change from subsidiary shares 0.8 0.0
Total as of December 31 2.5 1.7
Joint Ventures 2022 2021
Acquisition costs as of January 1 5.1 4.8
Share of joint ventures' result after
taxes*
0.3 0.2
Dividends received -0.1 0.0
Translation difference 0.0 0.1
Total as of December 31 5.3 5.1
2022
Carrying
amount
of the
investment
Non-
current
assets*
Current
assets*
Non-
current
liabilities*
Current
liabilities* Revenue*
Profit/
loss after
tax from
continuing
operations*
Total com-
prehensive
income*
Dividends
received
Investments in
associated companies
and joint ventures
7.8 3.6 54.5 0.9 31.3 69.3 1.4 1.4 0.2
Total 7.8 3.6 54.5 0.9 31.3 69.3 1.4 1.4 0.2
2021
Carrying
amount
of the
investment
Non-
current
assets*
Current
assets*
Non-
current
liabilities*
Current
liabilities* Revenue*
Profit/
loss after
tax from
continuing
operations*
Total com-
prehensive
income*
Dividends
received
Investments in
associated companies
and joint ventures
6.8 3.8 52.5 0.8 31.4 58.5 1.1 1.1 0.1
Total 6.8 3.8 52.5 0.8 31.4 58.5 1.1 1.1 0.1
* Including adjustments from purchase price allocation.
*Asset and liability values, revenue and profit/loss represent values according to the latest published financial information.
Konecranes owns as of December 31, 2022 49.5% of
AS Konesko shares.
Konecranes has recognized and accounted for the assets,
liabilities, revenues and expenses relating to its interest in
AS Konesko in accordance with IFRS 11.
16.2. Investments in Associated Companies and Joint Ventures
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16.4. Subsidiaries with material non-controlling interest
17. Deferred tax assets and liabilities
17.1. Deferred tax assets
17.2. Deferred tax liabilities
2022
Accumulated
non-controlling
Interest Goodwill
Non-current
assets Current assets
Non-current
liabilities
Current
liabilities Revenue
Profit/loss
after tax from
continuing
operations
Total
comprehensive
income
Non-controlling interests 0.1 0.0 1.4 5.3 0.1 6.9 6.6 -0.6 -0.6
Total 0.1 0.0 1.4 5.3 0.1 6.9 6.6 -0.6 -0.6
2021
Accumulated
non-controlling
Interest Goodwill
Non-current
assets Current assets
Non-current
liabilities
Current
liabilities Revenue
Profit/loss
after tax from
continuing
operations
Total
comprehensive
income
Non-controlling interests 9.2 0.0 66.6 38.1 10.6 58.0 42.4 4.4 4.4
Total 9.2 0.0 66.6 38.1 10.6 58.0 42.4 4.4 4.4
Assets and liabilities as well as revenue and profit/loss values represent the total company values including purchase price allocations. See also the company list for the ownership and principal place of business
of the subsidiaries.
2022 2021
Employee benefits 30.2 53.1
Provisions 18.0 18.1
Unused tax losses 10.1 9.6
Other temporary differences 45.4 39.4
Total 103.8 120.2
2022 2021
Intangible and tangible assets 114.8 121.0
Other temporary difference 18.9 21.6
Total 133.7 142.6
Other temporary differences include timing differences
arising for example from accrued costs, advances received
and unrealized currency differences that are not deductible
in taxation until they occur.
The deferred tax assets and deferred tax liabilities have
been netted on a juridical company level when there is a
legally enforceable right to offset income tax receivables
against income tax payables related to income taxes levied
by the same tax authority. The gross amount of deferred
tax assets in 2022 were EUR 110.9 million (EUR 125.3
million in 2021) and deferred tax liabilities EUR 140.8 million
(EUR 147.7 million in 2021).
Konecranes has not recognized the temporary differences in
investments in subsidiaries to the extent that they probably
will not reverse in the foreseeable future.
17.3. Tax losses carried forward
At the end of year 2022, Konecranes recorded a deferred
tax asset of EUR 10.1 million (EUR 9.6 million in 2021)
related to unused tax losses on the carry-forward losses
of EUR 187.2 million (EUR 199.9 million in 2021) in total.
The tax losses, for which no deferred tax assets are
recognized due to the uncertainty of the utilization of
the losses, amounted to EUR 144.4 million in the year
2022 (EUR 157.8 million in 2021). EUR 134.7 million of
these carry-forward tax losses available have unlimited
expiry, EUR 18.8 million expire later than in five years and
EUR 33.7 million expire in five years.
Part of the carry-forward losses relate to Morris Material
Handling, Inc., USA, which was acquired in 2006. The
overall carry-forward losses of Morris Material Handling, Inc.
amounted to EUR 23.1 million (EUR 24.1 million in 2021).
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Tax losses carried forward and related deferred tax assets on December 31
by the most significant countries as following:
2022
Tax losses
carried forward
Potential deferred
tax assets
Deferred tax assets
not recorded
Deferred
tax assets
France 75.2 18.8 18.8 0.0
India 25.1 6.3 6.3 0.0
USA 23.1 5.5 0.0 5.5
Austria 16.4 4.1 4.1 0.0
Australia 10.7 3.2 0.0 3.2
Philippines 5.3 1.3 1.3 0.0
Germany 4.4 1.4 1.4 0.0
Japan 4.0 1.2 1.2 0.0
Great Britain 3.4 0.9 0.9 0.0
South Africa 3.3 0.9 0.9 0.0
Other 16.2 3.0 1.7 1.4
Total 187.2 46.7 36.6 10.1
2021
Tax losses
carried forward
Potential deferred
tax assets
Deferred tax assets
not recorded
Deferred
tax assets
France 77.4 20.0 20.0 0.0
India 34.5 10.8 10.8 0.0
USA 24.2 5.7 0.0 5.7
Austria 17.9 4.5 4.2 0.3
Australia 3.2 1.0 0.0 1.0
Philippines 2.6 0.7 0.0 0.7
Germany 4.4 1.4 1.4 0.0
Japan 3.8 1.2 1.2 0.0
Great Britain 9.1 1.7 1.7 0.0
South Africa 5.1 1.4 1.4 0.0
Other 17.8 3.8 1.7 2.0
Total 199.9 52.0 42.4 9.6
To assess if the convincing evidence threshold per IAS
12 was met, Konecranes has prepared tax forecasts for
future periods considering the restructuring done and the
tax planning opportunities that were being implemented
at that time.
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18. Inventories
19. Ageing analysis of accounts receivable
2022 2021
Raw materials and semi-manufactured goods 357.3 278.4
Work in progress 551.9 380.7
Finished goods 38.1 46.2
Advance payments 45.3 21.1
Total 992.7 726.4
2022 2022 2021 2021
Accounts
receivable
including
impairment of
Accounts
receivable
including
impairment of
Not overdue 376.2 2.7 326.7 3.2
1−30 days overdue 92.9 0.8 81.7 0.5
31−60 days overdue 41.9 0.6 40.1 0.2
61−90 days overdue 26.4 1.1 19.4 0.7
more than 91 days overdue 48.1 19.2 24.3 22.2
Total 585.6 24.5 492.1 26.8
2022
Balance at the
beginning
of the year
Translation
difference
Business
combinations
Utilized during
the period
Provision not
needed Additions
Balance
at the end
of the year
Provision
for obsolete
inventory
42.0 0.3 0.0 -2.8 -1.2 13.9 52.2
2021
Balance at the
beginning
of the year
Translation
difference
Business
combinations
Utilized during
the period
Provision not
needed Additions
Balance
at the end
of the year
Provision
for obsolete
inventory
42.7 1.1 0.0 -9.2 -0.7 8.0 42.0
The carrying amount of accounts receivable approximates to their fair value. Accounts receivable are subject to only minor
credit risk concentrations due to the Group’s extensively diversified customer portfolio. Credit losses recognized from the
customer contracts for the financial year totaled EUR 5.9 million (EUR 5.8 million in 2021).
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2022
Balance at
the beginning
of the year
Translation
difference
Business
combinations
Utilized
during
the period
Provision not
needed Additions
Balance
at the end
of the year
Provision for
doubtful accounts
(Impairment)
26.8 0.0 0.0 -5.8 -8.2 11.7 24.5
2021
Balance at
the beginning
of the year
Translation
difference
Business
disposals
Utilized
during
the period
Provision not
needed Additions
Balance
at the end
of the year
Provision for
doubtful accounts
(Impairment)
31.8 1.5 0.0 -5.7 -5.8 5.0 26.8
The release of the provision for doubtful accounts relates to the cash received from individual receivables which were
historically provided for due to management’s uncertainty of their collectability.
19. Ageing analysis of accounts receivable (continues)
20. Other receivables
21. Deferred assets
22. Cash and cash equivalents
2022 2021
Notes receivable 5.6 4.7
Value added tax 31.2 23.4
Total 36.8 28.1
2022 2021
Interest 1.9 0.5
Prepaid expenses 23.0 23.1
Unbilled revenue 39.7 36.8
Other 33.4 33.8
Total 98.0 94.1
2022 2021
Short-term deposits 25.7 77.9
Cash in hand and at bank 388.2 242.8
Total 413.9 320.7
23. Equity
23.1. Shareholders’ equity
Number of
shares
Number of
treasury
shares
As of January 1, 2021 79,134,459 87,447
Share subscriptions with share
awards
0 0
As of December 31, 2021 79,134,459 87,447
Share subscriptions with share
awards
32,140 -32,140
As of December 31, 2022 79,166,599 55,307
The total shareholders’ equity consists of share capital,
share premium, paid in capital, cash flow hedges,
translation difference, other reserves and retained earnings.
Consistent with local legislation Konecranes’ share has no
nominal value. All issued shares are fully paid and listed on
Nasdaq Helsinki.
Share premium includes the value of shares, which exceeds
the accounting par value of the shares, for shares issued
before 1 September, 2006. Cash flow hedges include
changes in the fair values of derivative financial instruments
used to hedge operational cash flows. Translation
differences comprise the differences arising from translating
non-euro functional currency entities to euro, which is the
Group’s presentation currency. Other reserves include the
credit for equity settled share-based payment cost. The
paid in capital includes the portion of shares’ subscription
price, which is not recorded to share capital or to liabilities
according to IFRS. The paid in capital includes also other
capital contributions to the Group, which are not recorded
to some other reserve within the equity. The paid in capital
includes also the possible amount of share capital decrease,
which is not netted against accumulated losses or is not
distributed to shareholders.
Dividend proposal per share for 2022 was EUR 1.25 and
dividend for 2021 was EUR 1.25.
23.2. Distributable earnings
See page 119 / Board of Directors’ Proposal to the Annual
General Meeting.
Short-term deposits have a maturity of three months or
less. Cash and cash equivalents are carried at nominal
value, which corresponds to their fair value.
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24. Provisions
2022 Warranty Restructuring
Pension
commitments Other Total
Total provisions as of January 1 56.4 39.8 8.0 21.8 126.1
Translation difference -0.1 0.0 0.5 0.3 0.7
Increase through business combination 0.0 0.0 0.0 0.0 0.0
Additional provision in the period 24.1 7.9 1.0 8.4 41.4
Utilization of provision -11.0 -19.1 0.0 -6.9 -37.0
Unused amounts reversed -14.1 -0.9 -2.0 -1.8 -18.7
Total provisions as of December 31 55.4 27.7 7.5 21.9 112.4
2021 Warranty Restructuring
Pension
commitments Other Total
Total provisions as of January 1 63.7 64.8 6.0 26.5 161.0
Translation difference 0.9 0.4 0.5 0.6 2.4
Increase through business combination 0.0 0.0 0.0 0.0 0.0
Additional provision in the period 22.6 8.7 1.9 6.2 39.4
Utilization of provision -16.9 -32.3 0.0 -8.6 -57.8
Unused amounts reversed -13.8 -1.7 -0.4 -2.9 -18.9
Total provisions as of December 31 56.4 39.8 8.0 21.8 126.1
The provision for warranties covers the expenses due to
the repair or replacement of products during their warranty
period. The warranty liability is based on historical realized
warranty costs for deliveries of standard products and
services. The usual warranty period is 12 months. For more
complex contracts, mainly including long-term projects, the
warranty reserve is calculated contract by contract and the
warranty period can be significantly longer. The restructuring
provision is recognized when the Group has prepared a
detailed reorganization plan and begun implementation of
the plan or announced the matter. Pension commitments
include provisions for local pension schemes.
Other provisions include provisions for claims, litigations
and provisions for loss contracts in which the amount is not
provided for as part of work in progress or percentage of
completion receivable of the loss making project.
Restructuring costs
Konecranes has recorded EUR 17.0 million of restructuring
costs during 1–12/2022 (EUR 11.3 million expenses in
1–12/2021) of which EUR 2.9 million was impairment of
assets (EUR 0.3 million for 1–12/2021). The remaining
restructuring items are reported 1–12/2022 in personnel
costs (EUR 4.8 million), materials and supplies
(EUR 4.8 million) and in other operating expenses
(EUR 4.5 million).
War in Ukraine
Konecranes has reviewed the risks related to the
war in Ukraine for the effects to assets and ongoing
projects and impaired the values of property, plant and
equipment (EUR 2.1 million), inventories (EUR 1.5 million),
receivables (EUR 0.5 million) and deferred tax assets
(EUR 0.4 million) in Ukraine due to the circumstances,
which indicated that the carrying amount is unlikely to
be recoverable. Konecranes has also recorded additional
losses and provisions to the inventories and receivables
in Russia (EUR 1.1 million) and for the projects to Russia
(EUR 31.0 million), which includes a EUR 33.5 million
reversal of sales.
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25. Current liabilities
25.1. Accruals
2022 2021
Wages, salaries
and personnel expenses
127.7 119.8
Pension costs 8.6 10.4
Interest 11.5 7.0
Other items 50.5 53.7
Total 198.3 190.9
2022 2021
Value added tax 24.3 23.2
Payroll tax liability 17.6 18.8
Other short-term liabilities 14.2 11.2
Total 56.1 53.2
Maturity
of undiscounted cash flows 2022 2021
within 1 year 40.3 40.1
1−5 years 73.4 70.4
over 5 years 45.8 24.0
Total 159.5 134.5
Lease liabilities included
in the balance sheet 2022 2021
Non current interest-bearing liabilities 104.0 85.1
Current interest-bearing liabilities 36.5 38.3
Total as of December 31 140.5 123.4
25.2. Other current liabilities
(non-interest bearing)
26. Lease accounting
Amounts recognized
in statement of income 2022 2021
Depreciation for right of use asset 43.5 42.5
Income for subleasing right of
use asset
-1.1 -1.1
Expenses related to short-term leases 4.0 4.2
Expenses related to leases of
low-value assets
2.4 2.5
Interest on lease liabilities 4.1 3.6
Total expenses 52.9 51.6
Total cash flow of leases 54.7 52.7
2022 2021
Loans from financial institutions 928.8 328.5
Pension loans 20.0 25.0
Lease liabilities 104.0 85.1
Other long-term loans 3.6 8.5
Total 1,056.4 447.1
2022 2021
Loans from financial institutions 0.0 77.9
Bonds 0.0 249.8
Pension loans 5.0 5.0
Lease liabilities 36.5 38.3
Commercial papers 0.0 40.0
Other short-term loans 8.3 7.0
Total 49.8 418.0
The Group leases land and buildings for its production and
office space. The leases of production facilities typically
run for a period of two to seven years, and leases of office
space for one to ten years. Some leases include an option
to renew the lease for an additional period after the end
of the contract term. Konecranes Group has major lease
agreements of factory and office buildings in Hyvinkää and
Hämeenlinna, Finland. During 2022 the second extention
option of 5 years for these buildings was applied. Group
has also included one additional 5-year option in the lease
liability value. The Group has various other leases for office
equipment, vehicles and premises with varying terms and
renewal rights. Vehicles have typically a lease term from
three to seven years. Leasing contracts comply with normal
practices in the countries concerned. The average interest
rate in lease contracts was 3.54 % (3.24% in 2021).
27. Interest-bearing liabilities
27.1. Non-current
27.2. Current
During the year 2022 the Group cancelled the merger related
EUR 392 million committed financing facility (originally EUR
635 million) in full and prepaid the EUR 250 million senior
bond. In addition, the Group issued a new EUR 300 million
Schuldschein loan and repaid the EUR 73 million bilateral loan
which matured during the fourth quarter.
At the end of 2022, the Group’s liquid cash reserves were
EUR 413.9 million (31.12.2021: EUR 320.7 million). For
safeguarding the Group’s cash position, the Group has
established EUR 400 million committed revolving credit facility
with an international loan syndication (2017–2024), which
remained undrawn at the end of December 2022. In addition,
the Group may draw short-term financing from the domestic
commercial paper markets within the EUR 500 million
limit, which was unutilized at the end of December 2022
(December 31, 2021: EUR 40 million).
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At the end of December 2022, the outstanding short- and
long-term loan portfolio consists of: EUR 550 million term
loans, EUR 377 million Schuldschein loan and EUR 25 million
employment pension loan. The loan portfolio contains
floating and fixed rate tranches and interest swaps. The
weighted average interest rate for these loans is at the end
of period 2.50% per annum. The Group is in compliance with
the quarterly monitored financial covenant (gearing). No
specific securities have been given for the loans. The Group
continues to have healthy gearing ratio of 48.0% (December
31, 2021: 39.8%), which is in compliance with the financial
covenants the Group has to comply with.
Derivatives are initially recorded in the balance sheet at
fair value and subsequently measured at fair value at each
balance sheet date. All derivatives are carried as assets
when fair value is positive and liabilities when fair value is
negative. Derivative instruments that are not designated as
hedges (hedge accounting) are measured at fair value, and
the change in fair value is recognized in the consolidated
statement of income. When the derivative is designated
as a hedge (hedge accounting) the effective part of the
change in fair value is recognized in other comprehensive
income. Any ineffective part is recognized in the consolidated
statement of income. The foreign exchange forward contracts
are measured based on the closing date’s observable spot
exchange rates and the quoted yield curves of the respective
currencies. Interest rate swaps are measured based on
present value of the cash flows, which are discounted based
on the quoted yield curves.
In addition, the Group has certain revolving facilities the
details of which can be found in note 33.3.
The average interest rate of the non-current liabilities
portfolio at December 31, 2022 was 2.51% (2021: 1.42%)
and that of the current liabilities portfolio was 3.93%
(2021: 1.54%). The effective interest rate for EUR loans
varied between 0.80–4.05% (2021: 0.06–3.80%).
27.3. Maturity tables of financial liabilities
and liquidity risk
The following table reflects the maturity of interest
bearing liabilities.
2022 Maturity
Currency
Avg.
duration
Avg.
rate %
Less than
1 year 1–5 years
Over
5 years
Amount
MEUR
EUR 1.5 years 2.18 23.5 973.5 40.4 1,037.4
INR 1.7 years 8.62 0.3 0.6 0.0 0.8
CNY 1.5 years 4.59 1.6 1.2 0.0 2.8
USD 1.7 years 4.01 7.8 15.7 0.5 24.0
GBP 1.8 years 3.33 1.3 4.2 0.3 5.8
Others 1.1–3.0 years 1.43–20.78 15.3 13.3 6.7 35.3
Total 2.58 49.8 1,008.5 47.9 1,106.2
2021 Maturity
Currency
Avg.
duration
Avg.
rate %
Less than
1 year 1–5 years
Over
5 years
Amount
MEUR
EUR 1.5 years 1.23 387.6 386.5 17.5 791.6
INR 1.1 years 8.86 0.5 0.1 0.0 0.6
CNY 1.5 years 4.97 1.0 0.8 0.0 1.8
USD 1.7 years 3.62 7.5 14.3 0.6 22.5
GBP 1.8 years 2.81 2.0 4.6 0.7 7.2
Others 1.0–3.1 years 1.38–20.78 19.3 15.6 6.5 41.4
Total 1.48 418.0 421.8 25.2 865.1
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The following table reflects all contractually fixed pay-
offs for settlement, repayments and interest resulting
from recognized financial liabilities, excluding derivatives.
The amounts disclosed are undiscounted net cash outflows
for the respective upcoming fiscal years, based on the
2022 Maturity
Currency
Avg.
duration
Avg.
rate %
Less than
1 year
1–5
years
Over
5 years
Amount
MEUR
EUR 1.5 years 2.18 53.4 1,024.5 43.3 1,121.2
INR 1.7 years 8.62 0.3 0.6 0.0 0.9
CNY 1.5 years 4.59 1.7 1.3 0.0 3.0
USD 1.7 years 4.01 8.6 17.3 0.4 26.2
GBP 1.8 years 3.33 1.6 3.9 0.6 6.1
Others 1.1–3.0 years 1.43–20.78 17.0 15.5 13.2 45.7
Total debt 2.58 82.6 1,063.2 57.4 1,203.2
Other financial
liabilities
362.4 7.9 0.0 370.3
Total financial
liabilities
444.9 1,071.1 57.4 1,573.4
2021 Maturity
Currency
Avg.
duration
Avg.
rate %
Less than
1 year
1–5
years
Over
5 years
Amount
MEUR
EUR 1.5 years 1.23 399.9 400.7 13.9 814.6
INR 1.1 years 8.86 0.6 0.1 0.0 0.6
CNY 1.5 years 4.97 1.1 0.9 0.0 1.9
USD 1.7 years 3.62 7.8 14.4 0.8 22.9
GBP 1.8 years 2.81 1.4 3.9 0.9 6.2
Others 1.0–3.1 years 1.38–20.78 23.6 14.3 13.8 51.7
Total debt 1.48 434.4 434.3 29.4 898.1
Other financial
liabilities
308.6 10.5 0.0 319.1
Total financial
liabilities
743.0 444.8 29.4 1,217.2
27.4. Liquidity risk, containing undiscounted cash flows of non-derivative
financial liabilities by currency
earliest date on which Konecranes could be required to pay.
Cash outflows for financial liabilities (including interest)
without fixed amount or timing are based on the conditions
existing at December 31.
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27.5. Maturity profile of the Group’s financial liabilities
The following table reflects the maturity of all financial liabilities.
27.6. Changes in Group’s liabilities arising from financing activities
2022 Maturity of financial liabilities
Liability type
Amount
drawn
Less than
1 year
1–5
years
Over
5 years
Loans from financial institutions 928.8 0.0 918.8 10.0
Lease liabilities 140.5 36.5 66.2 37.8
Commercial paper program 0.0 0.0 0.0 0.0
Pension loans 25.0 5.0 20.0 0.0
Other long-term debt and short-term loans 11.9 8.3 3.5 0.2
Derivative financial instruments 15.9 15.9 0.0 0.0
Account and other payables 370.3 362.4 7.9 0.0
Total 1,492.3 428.0 1,016.4 47.9
2021 Maturity of financial liabilities
Liability type
Amount
drawn
Less than
1 year
1–5
years
Over
5 years
Loans from financial institutions 406.4 77.9 328.5 0.0
Bonds 249.8 249.8 0.0 0.0
Lease liabilities 123.4 38.3 68.2 16.9
Commercial paper program 40.0 40.0 0.0 0.0
Pension loans 30.0 5.0 20.0 5.0
Other long-term debt and short-term loans 15.5 7.0 6.1 2.4
Derivative financial instruments 16.9 16.9 0.0 0.0
Account and other payables 319.1 308.6 10.5 0.0
Total 1,201.0 743.5 433.2 24.4
2022
Non-current
interest
bearing loans
Non-current
lease
liabilities
Current
interest
bearing
loans
Current
lease
liabilities
Financial
derivatives Total
Total liabilities as of
January 1
362.0 85.1 379.7 38.3 16.9 882.0
Proceeds 600.0 0.0 0.0 0.0 0.0 600.0
Repayments -8.7 0.0 -366.7 -44.1 0.0 -419.5
Acquisitions and disposals 0.0 0.0 0.0 0.0 0.0 0.0
Foreign exchange
movement
0.2 0.6 0.0 0.3 0.0 1.1
Changes in fair values 0.0 0.0 0.0 0.0 -1.0 -1.0
Changes in lease contracts 0.0 61.5 0.0 -1.2 0.0 60.3
Other -1.0 -43.3 0.2 43.3 0.0 -0.8
Total as of December 31 952.4 104.0 13.3 36.5 15.9 1,122.1
2021
Non-current
interest
bearing loans
Non-current
lease
liabilities
Current
interest
bearing
loans
Current
lease
liabilities
Financial
derivatives Total
Total liabilities as of
January 1
768.8 90.9 273.2 37.9 5.5 1,176.3
Proceeds 0.0 0.0 0.0 0.0 0.0 0.0
Repayments -5.6 0.0 -296.4 -42.6 0.0 -344.6
Acquisitions and disposals 0.0 0.0 0.0 0.0 0.0 0.0
Foreign exchange
movement
0.3 2.5 0.6 1.1 0.0 4.5
Changes in fair values 0.0 0.0 0.0 0.0 11.4 11.4
Changes in lease contracts 0.0 36.3 0.0 -2.7 0.0 33.6
Other -401.6 -44.6 402.3 44.6 0.0 0.8
Total as of December 31 362.0 85.1 379.7 38.3 16.9 882.0
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28. Other long-term liabilities
28.1. Employee benefits
The company and most of its subsidiaries offer retirement
plans which cover the majority of employees in the Group.
Many of these plans are defined contribution, where
Konecranes’ contribution and resulting charge is fixed at a
set level or is a set percentage of employees’ pay. However
the Group has significant defined benefit pension plans in
the United Kingdom, Germany and Switzerland as well as
individually insignificant plans in other countries. Companies
in many countries have also other long-term employee
benefits such as part-time pension benefits and jubilee
benefits, which are reported as defined benefit plans.
The UK defined benefit plan is administered by an
independent trustee company that is legally separated
from the Group. The investments are managed by a
professional and independent Fiduciary Manager who is
appointed by the trustees. The Fiduciary Manager appoints
Investment Managers as he/she see fit in order to achieve
the Trustees’ stated objectives for the scheme funding
level and taking into account the agreed risk appetite.
The Fiduciary Manager has trigger points set in conjunction
with the Trustees which when reached allows he/she to
make changes to the investments to repatriate the gains to
achieve full funding position. The UK plan is subject to the
UK’s pensions legislation, is regulated by the UK Pensions
Regulator and is exempt from most UK taxation through its
registered status. The UK plan was closed to new members
in 2005. Under the UK plan the employees are entitled
to post-retirement installments calculated as an average
annual basic salary from the best three years within the last
ten years. The net liability in the United Kingdom was EUR
0.0 million (EUR 0.0 million in 2021).
2022 2021
Employee benefits 209.7 278.5
Other non-interest-bearing long-term
liabilities
7.9 10.5
Total 217.7 289.0
In Germany the defined benefit pension plans are direct
pension promises which are unfunded and administered
by a service provider. The payments to plan participants
start after retirement or in case of disability or death.
Benefits are based on the number of years worked and
the final salary. The commencement of pension payments
depends on the beginning of the state pension, which
is the earliest at age 63 in case of early retirement and
otherwise 65 for old age pension. The biggest defined
benefit pension plan in Germany is the Mannesmann
Leistungsordnung (MLO), which is closed to new employees.
The monthly pension benefit provided by this plan is
calculated as the ratio Individual pay/Average pay, times
the years of service, times 3.07, and has to be at least
equal to 2.10 times the years of service. The net liability
in Germany was EUR 184.8 million (EUR 242.4 million
in 2021) of which the MLO plan was EUR 124.3 million
(EUR 169.5 million in 2021).
The Swiss pension plans are administered via pension funds,
which are legally separated from the Group. The board
of Trustees of the pension funds are equally composed of
representatives of both the employer and employees. The
Trustees are required by law to act in the interest of all
relevant beneficiaries and are responsible for the investment
policy with regard to the assets and the administration and
financing of the benefits. The plans function in and comply
with a large regulatory framework and comply with the
local minimum funding requirements. The plans are open
to new members. Both the company and employees pay
contributions to fund the plans. The pension plans qualify as
defined benefit plan for IFRS purposes, because accruals are
by law subject to a minimum guaranteed rate of return and
the plan has to guarantee a certain legal minimum level of
benefits. There is hence a risk that the company may have
to pay additional contributions. Under the plans, participants
are also insured against the financial consequences of old
age, disability and death. The net liability in Switzerland
was EUR 1.8 million (EUR 7.4 million in 2021) of which the
pension plan was EUR 1.6 million (EUR 7.2 million in 2021).
The defined benefit plans typically expose the company
to actuarial risks such as: investment risk, interest rate
risk, longevity risk and salary risk. The investment risk is
being mitigated by investing the funds both to equity and
debt instruments.
The following tables summarize the components of net
benefit expense recognized in the statement of profit or
loss and the funded status and amounts recognized in the
balance sheet for the respective plans:
28.2. Amounts recognized in the balance sheet
2022 2021
Present value of obligation
wholly unfunded
207.9 271.2
Present value of obligation
wholly or partly funded
55.8 86.8
Defined benefit plan obligations 263.7 358.0
Fair value of plan assets -53.9 -79.5
Total net liability recognized 209.7 278.5
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2022 2021
Obligation as of January 1 358.0 380.8
Translation difference -2.4 5.6
Settlements and curtailments 0.0 -0.1
Current service cost 6.9 9.4
Interest cost 4.3 2.9
Past service cost -0.2 -0.3
Actuarial gains (-) / losses (+)
arising from changes in demographic
assumptions
-0.1 -3.1
Actuarial gains (-) / losses (+) arising
from changes in financial assumptions
-96.3 -20.2
Actuarial gains (-) / losses (+) arising
from experience
13.6 2.2
Benefits paid (-) -20.2 -19.1
Obligation as of December 31 263.7 358.0
Movements of the fair value
of plan assets 2022 2021
Fair value of plan assets as of January 1 79.5 81.6
Translation difference -1.9 5.1
Interest income 1.4 1.1
Employee contributions 0.4 1.4
Employer contributions 0.8 0.1
The return on plan assets
(excluding amounts included in the
net interest expense)
-20.2 -3.7
Benefits paid (-) -6.1 -6.2
Fair value of plan assets as of
December 31
53.9 79.5
2022 2021
Service cost:
Current service cost 6.7 9.3
Net interest cost 2.9 1.8
Past service cost -0.2 -0.3
Effect of settlement and curtailments 0.0 -0.1
Components of defined benefit
plan costs recorded in profit or loss
9.5 10.7
2022 2021
Remeasurement on
the net defined benefit liability:
The return on plan assets (excluding
amounts included in the net interest
expense) gains (-) / losses (+)
20.2 3.7
Actuarial gains (-) / losses (+)
arising from changes in demographic
assumptions
-0.1 -3.1
Actuarial gains (-) / losses (+) arising
from changes in financial assumptions
-96.3 -20.2
Actuarial gains (-) / losses (+) arising
from experience
13.6 2.2
Components of defined benefit
plan costs recorded in other
comprehensive income
-62.6 -17.6
Total (income (-) / expense (+)) -53.1 -6.9
28.3. Components of defined benefit plan
recorded in comprehensive income
The actuarial gains / losses in 2022 and 2021 were mainly
caused by the change of discount rates in the defined
benefit plans of Germany, Switzerland and the United
Kingdom.
28.4. Movements of the present value
of defined benefit obligation
Of the benefits paid, EUR 6.1 million (2021: EUR 6.2
million) was paid from plan assets and EUR 14.1 million
(2021: EUR 12.9 million) by employer directly.
28.5. Major categories of plan assets
at the end of the reporting period
2022 2021
Equity instruments 4.6 13.6
Debt instruments 30.7 51.5
Insurances 13.6 1.6
Real estate 3.3 7.2
Others 1.7 5.5
Total plan assets 53.9 79.5
The plan assets do not contain any Konecranes shares or
assets.
Virtually all equity and debt instruments have quoted prices
in active markets. The plan assets originate from the United
Kingdom, Switzerland, Germany and India. It is the policy
of the UK fund to invest approximately 20–25% to growth
assets such as equity instruments as well as property and
growth funds and 75–80% to risk reducing assets such as
corporate bonds and fixed or index-linked gilts. The Swiss
pension funds are secured by insurances. The company can
only indirectly and partially determine the asset allocation
through the 50/50 employer/employee representation
in the board of Trustees. The return on plan assets was
EUR -18.8 million (2021: EUR -2.6 million).
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Sensitivity analysis Increase Decrease
0.5% points change in the
discount rate
-5.6% 6.2%
0.5% points change in the expected
development of salaries
0.4% -0.4%
0.5% points change in the expected
development of pensions
4.2% -3.8%
28.6. Defined benefit plan:
the main actuarial assumptions
With the objective of presenting the assets and liabilities
of the defined benefit plans at their fair value on the
balance sheet, assumptions under IAS 19 are set by
reference to market conditions at the valuation date.
Qualified independent actuaries have updated the actuarial
valuations under IAS 19 of the major defined benefit
schemes operated by the Group to December 31, 2022.
The assumptions used by the actuaries are chosen from
a range of possible actuarial assumptions which, due to
the long-term nature of the schemes, may not necessarily
be borne out in practice. The actuarial assumptions used
to calculate the benefit liabilities therefore vary according
to the country in which the plan is situated. The following
table shows the assumptions, weighted by liabilities, used to
value the principal defined benefit plans.
Germany 2022 2021
Discount rate % 3.71 1.05
Expected development of salaries % 2.66 2.42
Expected development of pensions % 2.00 1.65
Mortality table: Richttafeln 2018 G von Klaus Heubeck
UK 2022 2021
Discount rate % 5.00 1.80
Expected development of pensions % 3.10 3.30
Mortality table: SAPS base table of S3PA, applied at year of birth
and weighted by male/female deferred members and pensioners,
and CMI 2020 (2021: CMI 2020) projections with a long term
improvement parameter of 1.25% (2021: 1.25%) per annum.
Switzerland 2022 2021
Discount rate % 2.15 0.17
Expected development of salaries % 1.50 1.25
Mortality table: BVG 2020 Generational and improvement factors
CMI 2019 LTR 1.5%.
Other 2022 2021
Discount rate % 2.80 - 10.50 0.60 - 12.42
Expected development of salaries % 1.16 - 11.00 1.10 - 10.05
Expected development of pensions % 2.00 - 10.57 1.61 - 10.57
The below table shows the % effect of a change in the
significant actuarial assumptions used to determine
the retirement benefits obligations in our main defined
benefit pension obligation countries. The effect shows the
increase or decrease in the liability. In the calculation of the
sensitivity of the discount rate any effect from the return of
plan assets has been ignored.
The sensitivity analyses above have been determined
based on reasonably possible changes of the respective
assumptions occurring at the end of the reporting period
and may not be representative of the actual change. It is
based on a change in the key assumption while holding all
other assumptions constant. A linear extrapolation of these
amounts based on alternative changes in the assumptions
as well as an addition of combined changes in the individual
assumptions is not possible.
There are no changes in the way the sensitivity analyses
were performed compared to the previous years.
The average duration of the defined benefit obligation
weighted by the present value of the defined benefit
obligation is 12 years (2021: 15 years).
The Group expects to contribute EUR 0.8 million to the
above defined benefit pension plans in 2023 (Employer
contribution).
29. Share-based payments
Performance Share Plan
The Board of Directors of Konecranes Plc has resolved in
2017 to establish a long-term incentive plan for the Group
key employees and the President and CEO. The share-
based incentive plans are a Performance Share Plan 2017
for the Group key employees, a Restricted Share Unit Plan
2017 for selected Group key employees and a Performance
Share Plan 2017–2021 for the President and CEO. The
potential rewards from the incentive plans will be paid partly
in Konecranes Plc shares and partly in cash to be used for
taxes and tax-related costs after the performance periods
or vesting periods. As a rule, no reward will be paid if a
plan participant’s employment or service ends before the
reward payment. The Performance Share Plan included
three performance periods, calendar years 2017–2019,
2018–2020 and 2019–2021. The Board of Directors
resolved on the performance criteria and on the required
performance levels for each criterion at the beginning of
each performance period.
The Board of Directors of Konecranes Plc resolved that the
performance criteria for the performance period 2019–2021
under the company’s Performance Share Plan (the “Plan”)
are the cumulative adjusted Earnings per Share (EPS) and
the cumulative annual growth rate (CAGR) for Sales of the
financial years 2019–2021. Adjustments to the EPS include
defined restructuring costs, purchase price allocation
amortization and certain other unusual items. The target
group of the Plan for the performance period 2019–2021
consists of a maximum of 200 key employees of the
Konecranes Group. The rewards to be paid on the basis of
the performance period 2019–2021 correspond to the value
of a maximum total of 670,000 Konecranes Plc shares. If
the target determined by the Board of Directors is attained,
the reward payout may be half of the maximum reward.
The maximum reward payout requires that the target is
clearly exceeded.
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The Board of Directors of Konecranes Plc resolved in
2020 to establish a new Performance Share Plan 2020 for
Konecranes key employees. The Plan has a performance
period from 2020 to 2022 with three separate measurement
periods and separate targets for 2020, 2021 and 2022.
The criterion for the measurement periods 2020, 2021 and
2022 is adjusted Earnings per Share (EPS). Adjustments to
the EPS include defined restructuring costs, mergers and
acquisitions related deal costs and other unusual items.
The target group of the Plan for the performance period
2020–2022 consists of a maximum of 170 key employees of
the Konecranes group. The rewards to be paid on the basis
of the performance period 2020–2022 correspond to the
value of a maximum total of 600,000 Konecranes Plc shares.
The payment of the total reward takes place in 2023 if the
plan term conditions are met. The potential rewards from
the Plan will be paid partly in company shares and partly in
cash after the performance periods. The cash proportion is
intended to cover taxes and tax-related costs arising from
the rewards to the plan participants. As a rule, no reward
will be paid if plan participant’s employment or service ends
before the reward payment.
The Board of Directors of Konecranes Plc resolved in
2021 to establish a new Performance Share Plan 2021 for
Konecranes key employees. The Plan has a performance
period from 2021 to 2023 with three separate measurement
periods and separate targets for 2021, 2022 and 2023.
The criterion for the measurement period 2021 and 2022
is adjusted Earnings per Share (EPS). Adjustments to
the EPS include defined restructuring costs, mergers and
acquisitions related deal costs and other unusual items.
The target group of the Plan for the performance period
2021–2023 consists of a maximum of 170 key employees of
the Konecranes group. The rewards to be paid on the basis
of the performance period 2021–2023 correspond to the
value of a maximum total of 634,921 Konecranes Plc shares.
The payment of the total reward takes place in 2024 if the
plan term conditions are met. The potential rewards from
the Plan will be paid partly in company shares and partly in
cash after the performance periods. The cash proportion is
intended to cover taxes and tax-related costs arising from
the rewards to the plan participants. As a rule, no reward
will be paid if plan participant’s employment or service ends
before the reward payment.
The Board of Directors of Konecranes Plc resolved in
2022 to establish a new Performance Share Plan 2022 for
Konecranes key employees. The Plan has a performance
period from 2022 to 2024 with three separate measurement
periods and separate targets for 2022, 2023 and 2024.
The criterion for the measurement period 2022 is adjusted
Earnings per Share (EPS). Adjustments to the EPS include
defined restructuring costs, mergers and acquisitions
related deal costs and other unusual items. The EPS target
for the first measurement period has also been resolved by
the Board of Directors. The target group of the Plan for the
performance period 2022–2024 consists of a maximum of
170 key employees of the Konecranes group. The rewards
to be paid based on the Plan correspond to the value of
a maximum total of 600,000 Konecranes Plc shares. The
payment of the total reward takes place in 2025 if the plan
term conditions are met. The potential rewards from the
Plan will be paid partly in Konecranes Plc shares and partly
in cash after the performance period. The cash proportion
is intended to cover taxes and tax-related costs arising from
the rewards to the plan participants. As a rule, no reward
will be paid if plan participant’s employment or service ends
before the reward payment.
Restricted Share Unit Plan
The Restricted Share Unit Plan 2017 is directed to selected
key employees in Konecranes. The vesting periods will last
for 12 to 36 months. The prerequisite for reward payment is
that a key employee’s employment or service continues until
the end of the vesting period. The rewards to be allocated
on the basis of the entire plan will amount to a maximum
total of 200,000 Konecranes Plc class shares including also
the proportion to be paid in cash. 17,170 shares (no shares
in 2021) of the restricted share unit plan were allocated
during 2022.
Restricted Share Unit Plan 2020
Konecranes Plc and Cargotec Corporation signed on October
1, 2020 a combination agreement and a merger plan to
combine the two companies through a merger. The Board of
Directors of Konecranes Plc decided to establish a share-
based incentive plan for the Group key employees. The
Restricted Share Unit Plan 2020 was intended to function as
a bridge plan for the transition period before the closing of
the Transaction and forming the combined company in the
merger. The aim of the Plan was to align the objectives of
the shareholders and the key employees, to secure business
continuity during the Transition Period, andto retain key
employees at the company.
As the merger was cancelled in March 2022, also the
Restricted Share Unit Plan 2020 was cancelled in 2022.
Ownership Obligations
A member of the Konecranes Leadership Team must hold
a minimum of 50 percent of any net shares given on the
basis of these plans, until the member’s shareholding in the
company in total corresponds to the value of the member’s
annual salary and the member’s membership in the
Konecranes Leadership Team continues.
The fair value of the equity-settled portion of the share
rights granted is estimated at the date of grant using a
Monte-Carlo simulation model, taking into account the
terms and conditions upon which the share rights were
granted. The model simulates the TSR and compares it
against the group of principal competitors. It takes into
account historical and expected dividends, and the share
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price fluctuation covariance of the Group and its competitors
to predict the distribution of relative share performance.
Fair value of the cash-settled portion is measured at each
reporting date using a binomial option pricing model taking
into account the terms and conditions upon which the
instruments were granted and the current likelihood of
achieving the specified target.
Employee Share Savings Plan
The Group has launched an Employee Share Savings Plan
(ESSP) in which each participant will receive one free
matching share for every two acquired savings shares.
Matching shares will be delivered to a participant if the
participant holds the acquired shares from the plan until the
end of the designated holding period. The matching shares
will be paid in Konecranes shares and partly in cash. The
expenses of the plan are recognized over the vesting period
based on the quarterly acquired savings share amounts.
The fair value of the equity-settled portion of the share
options granted is estimated at the date of grant using a
binominal option pricing model, taking into account the
terms and conditions upon which the share options were
granted. Fair value of the cash-settled portion is measured
at each reporting date using a binomial option pricing model
taking into account the terms and conditions upon which
the instruments were granted and the current likelihood of
achieving the specified target.
29.1. Expenses for employee service
29.3. Changes in the number of net share
rewards in Restricted Share Unit Plan 2020
29.2. Changes in the number of gross share
rewards in Performance Share Plan
2022 2021
Expense arising from equity-settled
share-based payment transactions
6.7 9.5
Expense arising from cash-settled
share-based payment transactions
-1.9 2.5
Total expense arising from share-
based payment transactions
4.7 11.9
2022 2021
Number
of shares
Number
of shares
As of January 1 1,715,800 1,947,600
Share rewards granted 581,670 633,300
Share rewards awarded -149,661 -2,000
Share rewards expired -477,839 -668,933
Share rewards forfeited -14,500 -194,167
Total as of December 31 1,655,470 1,715,800
2022 2021
Number
of shares
Number
of shares
As of January 1 110,686 119,246
Share rewards granted 0 8,238
Share rewards expired -110,686 0
Share rewards forfeited 0 -16,798
Total as of December 31 0 110,686
The carrying amount of the liability arising from cash settled
portion was EUR 0.8 million (2021: EUR 3.0 million).
29.4. Changes in the number of gross share
rewards in Employee Share Savings Plan
2022 2021
Number
of shares
Number
of shares
Outstanding as of January 1 190,438 182,160
Share rewards granted 84,047 64,142
Share rewards awarded -52,620 -45,751
Share rewards forfeited -12,288 -10,113
Outstanding as of December 31 209,577 190,438
29.5. Assumptions made in determining the
fair value of Performance Shares Plan
The fair value for the cash settled portion is remeasured at
each reporting date until the possible share delivery. The
fair value of the liability will thus change in accordance with
the Konecranes Plc share price.
For the 2019–2021 vesting periods granted in 2019 the fair
value for the equity settled portion is based on two non-
market vesting conditions (adjusted EPS and annual growth
rate of sales). For the 2020–2022 vesting periods granted
in 2020 the fair value for the equity settled portion is based
on one non-market vesting condition (adjusted EPS). For
the 2021–2023 vesting periods granted in 2021 the fair
value for the equity settled portion is based on one non-
market vesting condition (adjusted EPS) for the year 2021
and 2022 when the condition for 2023 is still open. For the
2022–2024 vesting periods granted in 2022 the fair value
for the equity settled portion is based on one non-market
vesting condition (adjusted EPS) for the year 2022 when the
conditions for 2023 and 2024 are still open. The fair value
for the equity settled portion based on non-market vesting
condition has been determined at grant using the fair value
of Konecranes share as of the grant date and expected
dividend yield.
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2022 plan 2021 plan
2020
Restricted
share unit plan 2020 plan 2019 plan
Share price at grant, EUR 22.13 38.77 27.74 26.95 31.09
Share price at reporting period end
31.12., EUR
28.76 28.76 28.76 28.76 28.76
Expected volatility, % * 48.0% 26.0% 31.0% 32.0% 25.0%
Risk-free interest rate, % 0.7% 0.0% 0.0% 0.0% 0.0%
Expected dividend per share, pa, EUR 1.3 1.7 3.2 1.7 1.1
Expected contractual life in years 2.8 2.8 0.0 2.5 2.8
Weighted average fair value of the share
rewards at the grant date
18.20 33.75 24.54 22.59 27.66
Model used Black-Scholes Black-Scholes Black-Scholes Black-Scholes Black-Scholes
* Expected volatility was determined by calculating the historical volatility of the Konecranes share using monthly observations over
corresponding maturity.
30. Related party transactions
The related parties of Konecranes include subsidiaries
(see Company list), associated companies, joint ventures
and joint operations, pension fund in the United Kingdom
and the key management personnel of the Group and major
shareholders. The key management personnel of the Group
is comprised of the Board of Directors, the CEO and the
Konecranes Leadership Team.
30.1. Key Management compensation
Board of Directors
The remuneration packages for Board members are
resolved by the Annual General Meeting (AGM) on proposal
by the Nomination Committee. The AGM 2022 confirmed an
annual fee of EUR 140,000 for the Chairman of the Board
(2021: EUR 140,000), EUR 100,000 for the Vice Chairman
of the Board (2021: EUR 100,000), and EUR 70,000 for
other Board members (2021: EUR 70,000). In case the term
of office of a Board member ends before the closing of the
Annual General Meeting in 2023, he or she is entitled to
the prorated amount of the annual remuneration calculated
on the basis of his or her actual term in office. In addition,
compensation of EUR 1,500 was approved per meeting
for attendance at Board committee meetings (2021: EUR
1,500). However, the chairman of audit committee is
entitled to a compensation of EUR 3,000 (2021: EUR 3,000)
per meeting for attendance at audit committee meetings.
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2022
Total compensation to
the Board of directors
Number of shares
as part of
compensation
Value of
compensation
in shares, EUR
Compensation paid
in cash, EUR
Total
compensation, EUR
Chairman of the Board 1,874 51,298 90,036 141,334
Board members 7,167 192,005 394,831 586,836
Total 9,041 243,304 484,866 728,170
2021
Total compensation to
the Board of directors
Number of shares
as part of
compensation
Value of
compensation
in shares, EUR
Compensation paid
in cash, EUR
Total
compensation, EUR
Chairman of the Board 1,508 55,908 96,092 152,000
Board members 3,770 139,771 288,229 428,000
Total 5,278 195,680 384,320 580,000
According to the proposal, 50% of the annual remuneration
is to be used for acquiring shares in the company. The
remuneration may also be paid by transferring treasury
shares based on the authorization given to the board of
directors by the general meeting. In case such purchase
of shares cannot be carried out due to reasons related
either to the company or to a board member, the annual
remuneration shall be paid entirely in cash.
Travel expenses will be compensated against receipt.
President and CEO 2022 2021
Salary and benefits, EUR (Anders Svensson October 19 – December 31, 2022, Teo Ottola January 1 – October
18, 2022, Rob Smith January 1, 2021 – December 31, 2021)
750,905 901,303
Annual variable pay, EUR 1,087,088 256,284
Total 1,837,993 1,157,587
Expense of statutory pension plans (Anders Svensson October 19 – December 31, 2022,
Teo Ottola January 1 – October 18, 2022, Rob Smith January 1, 2021 – December 31, 2021)
203,162 184,172
Expense of voluntary pension plans (Anders Svensson October 19 – December 31, 2022,
Teo Ottola January 1 – October 18, 2022, Rob Smith January 1, 2021 – December 31, 2021)
48,802 106,664
Total 251,964 290,836
Accrued annual variable pay of CEO 48,557 615,815
The accrual of variable pay is paid during the following year.
Shareholding in Konecranes Plc (number of shares) 0 0
Performance share rights allocated (number of share rights)
1)
17,170 0
Share-based payment costs, EUR -68,933 -218,859
Retirement age 63 years 63 years
Period of notice 6 months
Severance payment (including 6 months notice period)
18 months
salary and
fringe benefits
1)
Performance share rights allocated to Rob Smith on December 31, 2021 are reported zero as he is not entitled to receive them.
Expense of statutory pension plans was EUR 0.1 million in 2022 (EUR 0.0 million in 2021).
President and CEO
The Human Resources Committee reviews the President
and CEO’s performance. Based on this review and relevant
facts, the Board sets the total compensation package for the
President and CEO.
August 6, 2021 Konecranes announced that Rob Smith
has decided to leave the company. He left Konecranes
on December 31, 2021. The company’s CFO, Teo Ottola,
who also serves as Deputy CEO, acted as the interim CEO
from January 1, 2022 until October 18, 2022. Konecanes
announced 10 June 2022 that Anders Svensson has been
appointed as Konecranes’ new President and CEO and he
assumed his role on October 19, 2022.
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Konecranes Leadership Team
The Konecranes Leadership Team (KLT) convenes as
frequently as necessary, normally on a monthly basis.
Business Areas have their own management teams that
convene on a regular basis. Only the KLT is classified to key
management personnel due to the decision making power.
The Konecranes Leadership Team consists of the following
members:
• President and CEO
• Chief Financial Officer, Deputy CEO
• Executive Vice President, Industrial Service and Equipment
• Executive Vice President, Port Solutions
• Executive Vice President, Technologies
• Senior Vice President, Human Resources
• Senior Vice President, General Counsel
• Executive Vice President, Senior Vice President,
Integration and Project Management Office
The Human Resources Committee of the Board will, based
upon a recommendation by the President and CEO, make a
proposal to the Board concerning the approval of the base
compensation review and incentive levels for KLT members.
The retirement age of the Finnish members of the KLT
(excluding the President and CEO) is set according to the
Employees Pensions Act (TyEL). The Finnish members of the
KLT also participate in the contribution-based group pension
insurance scheme offered to key personnel in Finland.
The defined contribution payment by the company is 1% of
annual salary excluding performance based compensation
(annual or long term incentives). The Finnish KLT members
also have life insurance and disability insurances. Non-
Finnish members have local insurances.
Konecranes Leadership Team excluding the President and CEO 2022 2021
Salary and benefits, EUR 1,952,574 2,227,618
Annual variable pay, EUR 1,859,503 864,377
Total 3,812,077 3,091,995
Expense of statutory pension plans 430,913 335,934
Expense of voluntary pension plans 14,358 19,688
Total 445,271 355,622
Shareholding in Konecranes Plc (number of shares) 162,796 156,161
Performance share rights allocated (number of share rights) 256,000 317,419
Share-based payment costs, EUR 196,577 2,014,697
There were no loans outstanding to the Konecranes Leadership Team at end of the period 2022 and 2021.
There were no guarantees on behalf of the Konecranes Leadership Team in year 2022 and 2021.
The employee benefits to the key management personnel of the Group were in total EUR 6.6 million in year 2022
(EUR 7.3 million in year 2021).
2022 2021
Sales of goods and services with associated companies and joint arrangements 25.4 18.0
Receivables from associated companies and joint arrangements 4.1 3.3
Purchases of goods and services from associated companies and joint arrangements 64.5 53.6
Liabilities to associated companies and joint arrangements 1.5 1.7
30.2. Transactions with associated companies and joint arrangements
Sales to and purchases from related parties are concluded using terms equivalent to arm’s length transaction.
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2022 2021
Financial assets
Fair value
through
OCI
Fair value
through income
statement
Amortized
cost
Carrying amounts
by balance
sheet item
Fair value
through
OCI
Fair value
through income
statement
Amortized
cost
Carrying amounts
by balance
sheet item
Current financial assets
Account and other receivables 0.0 0.0 622.5 622.5 0.0 0.0 520.2 520.2
Derivative financial instruments 12.2 31.5 0.0 43.7 1.5 2.1 0.0 3.6
Cash and cash equivalents 0.0 0.0 413.9 413.9 0.0 0.0 320.7 320.7
Total 12.2 31.5 1,036.3 1,080.0 1.5 2.1 840.9 844.5
Financial liabilities
Non-current financial liabilities
Interest-bearing liabilities 0.0 0.0 1,056.4 1,056.4 0.0 0.0 447.1 447.1
Other payables 0.0 0.0 7.9 7.9 0.0 0.0 10.5 10.5
Current financial liabilities
Interest-bearing liabilities 0.0 0.0 49.8 49.8 0.0 0.0 418.0 418.0
Derivative financial instruments 10.7 5.2 0.0 15.9 7.0 9.9 0.0 16.9
Account and other payables 0.0 0.0 362.4 362.4 0.0 0.0 308.6 308.6
Total 10.7 5.2 1,476.4 1,492.3 7.0 9.9 1,184.2 1,201.1
30.3. Transactions with Pension Fund
in the United Kingdom
30.4. Transactions with Board members
31. Guarantees and contingent
liabilities
2022 2021
Employer contributions 0.2 0.0
2022 2021
Board member holding the bond
of Konecranes Plc through a 100%
owned company
Interest-bearing short-term liabilities 0.0 0.1
2022 2021
For own commercial obligations
Guarantees 862.5 783.0
Other 72.7 55.1
Total 935.2 838.2
From time to time Konecranes provides customers with
guarantees that guarantee Company’s obligations pursuant
to the applicable customer contract. In sales of investment
goods (machinery) the typical guarantees are the following:
• tender guarantees (bid bonds) given to the customer to
secure the bidding process
• advance payment guarantees given to the customer to
secure their down payment for project
• performance guarantees to secure customers over the
company’s own performance in customer contracts, and
• warranty period guarantees to secure the correction of
defects during the warranty period.
Contingent liabilities relating to litigation
Various legal actions, claims and other proceedings pend
against the Group in various countries. These actions,
claims and other proceedings are typical of this industry and
consistent with a global business offering that encompasses
a wide range of products and services. These matters
involve contractual disputes, warranty claims, product
liability (including design defects, manufacturing defects,
failure to warn and asbestos legacy), employment, vehicles
and other matters involving claims of general liability.
While the final outcome of these matters cannot be
predicted with certainty, Konecranes has the opinion, based
on the information available to date and considering the
grounds presented for such claims, the available insurance
coverage and the reserves made, that the outcome of
such actions, claims and other proceedings, if unfavorable,
would not have a material, adverse impact on the financial
condition of the Group.
32. Financial assets and liabilities
32.1. Carrying amounts of financial assets and liabilities
Additional information on financial instruments is presented in Note 34.
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32.2. Fair values
Set out below is a comparison, by class, of the carrying amounts
and fair value of the Group’s financial assets and liabilities:
Carrying amount Fair value
Financial assets 2022 2021 2022 2021 Note
Current financial assets
Account and other receivables 622.5 520.2 622.5 520.2 19,20
Derivative financial instruments 43.7 3.6 43.7 3.6 34.1
Cash and cash equivalents 413.9 320.7 413.9 320.7 22
Total 1,080.0 844.5 1,080.0 844.5
Financial liabilities
Non-current financial liabilities
Interest-bearing liabilities 1,056.4 447.1 1,082.4 448.3 27.1
Other payables 7.9 10.5 7.9 10.5
Current financial liabilities
Interest-bearing liabilities 49.8 418.0 49.8 419.1 27.2
Derivative financial instruments 15.9 16.9 15.9 16.9 34.1
Account and other payables 362.4 308.6 362.4 308.6 25.2
Total 1,492.3 1,201.0 1,518.3 1,203.4
The management assessed that cash and short-term
deposits, trade receivables, trade payables, bank overdrafts
and other current liabilities approximate their carrying
amounts largely due to the short-term maturities of
these instruments.
The fair value of the financial assets and liabilities is
included at the amount at which the instrument could be
exchanged in a current transaction between willing parties,
other than in a forced or liquidation sale. Long-term fixed-
rate and variable-rate borrowings are evaluated by the
Group based on parameters such as interest rates and the
risk characteristics of the loan.
IFRS 7 requires that the classification of financial
instruments at fair value be determined by reference to
the source of inputs used to derive the fair value. This
classification uses the following three-level hierarchy:
• Level 1 − quoted prices in active markets for identical
financial instruments
• Level 2 − inputs other than quoted prices included within
level 1 that are observable for the financial instrument,
either directly (i.e. as prices) or indirectly (i.e. derived
from prices)
• Level 3 − inputs for the financial instrument that are not
based on observable market data (unobservable inputs)
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32.3. Hierarchy of fair values
The following table allocates financial assets and financial
liabilities measured at fair value to the three levels of the
fair value hierarchy.
2022 2021
Financial assets Level 1 Level 2 Level 3 Level 1 Level 2 Level 3
Derivative financial instruments
Foreign exchange forward contracts 0.0 41.9 0.0 0.0 3.5 0.0
Fuel oil derivate 0.0 0.0 0.0 0.0 0.1 0.0
Interest rate derivative 0.0 1.8 0.0 0.0 0.0 0.0
Total 0.0 43.7 0.0 0.0 3.6 0.0
Other financial assets
Cash and cash equivalents 413.1 0.0 0.8 320.7 0.0 0.0
Total 413.1 0.0 0.8 320.7 0.0 0.0
Total financial assets 413.1 43.7 0.8 320.7 3.6 0.0
Financial liabilities
Derivative financial instruments
Foreign exchange forward contracts 0.0 15.8 0.0 0.0 16.9 0.0
Fuel oil derivative 0.0 0.1 0.0 0.0 0.0 0.0
Total 0.0 15.9 0.0 0.0 16.9 0.0
Other financial liabilities
Interest bearing liabilities 0.0 1,106.2 0.0 0.0 865.1 0.0
Other payables 0.0 0.0 0.8 0.0 0.0 3.0
Total 0.0 1,106.2 0.8 0.0 865.1 3.0
Total financial liabilities 0.0 1,122.1 0.8 0.0 882.0 3.0
There were no significant changes in classification of fair
value of financial assets and financial liabilities in the period
2021 to 2022. There were also no significant movements
between the fair value hierarchy classifications.
33. Management of financial risks
The nature of Konecranes’ business and its global
presence exposes it to a range of financial risks. These
risks include (i) market risks, which include potential
unfavorable changes in foreign exchange rates, interest
rates and commodities (ii) liquidity risk and (iii) credit and
counterparty risk.
33.1. Market risk
The responsibility of identifying, evaluating and controlling
the financial risks arising from the Group’s global business
operations is divided between the business units and the
Group Treasury. However, the Group uses an approach
in which most of the management of financial risks is
centralized to Konecranes’ Group Treasury. The Group
Treasury functions within the legal entity Konecranes
Finance Corporation. By centralization and netting of
internal foreign currency cash flows, the Group’s external
hedging needs can be minimized.
Konecranes Finance Corporation is not a profit center in
the sense that it would pursue to maximize its profits.
The company aims to serve the operating companies of the
Group in reducing their financial risks.
The Group’s global business operations involve market risks
in the form of currency, interest rate and commodity risk.
The Group’s objective is to increase the short-term stability
of the financial environment for the business operations by
reducing the negative effects caused by price fluctuations
and other uncertainties in the financial markets.
Business units hedge their risks internally with the Group
Treasury. As a result of this, most of the financial risks of
the Group are concentrated into one company, Konecranes
Finance Corporation, and can be evaluated and controlled in
an efficient way.
The level 3 valuations in other payables are contingent
consideration liabilities resulting from business combinations
or the acquisition of non-controlling interest and the cash
settled share based payment liability.
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Almost all funding, cash management and foreign exchange
with banks and other external counterparties are centralized
to and managed in Konecranes Finance Corporation in
accordance with the Group’s Treasury Policy. In a few
special cases, when the local central bank regulation
prohibits using group services in hedging and funding, this
must be done directly between an operating company and a
bank under the supervision of the Group Treasury.
Konecranes Finance Corporation uses a treasury system,
which enables practically a real-time processing of
transactions and in-depth records of activities and
performance. The standard reporting is done on a weekly
basis and it covers group-level commercial and financial
cash flows, foreign currency transaction exposure, debt
positions, portfolio of derivatives and counterparty credit
exposure for financial transactions. In addition, all Group
companies participate in the monthly managerial and
statutory reporting.
Foreign exchange risk
The Group’s global business operations generate foreign
exchange risk. However, most of the business units only
have transactions in their own currency, i.e. these units
have their sales and costs as well as internal funding
from Konecranes Finance Corporation in their local home
currency. Only 30 out of some 150 Group companies
operate regularly in a foreign currency. These companies
hedge their foreign exchange risk with Group Treasury.
Depending on the business area and the probability of
the cash flows, the hedging covers operative cash flows
for the next 1–24 months and is done by using internal
foreign exchange forward contracts. In this way, Konecranes
Finance Corporation can manage the foreign exchange risk
of the whole Group. The foreign currency funding of the
other Group companies and possibly some external foreign
currency funding can net some of these foreign currency
items. The residual net exposure can be covered with
commercial banks using foreign exchange forward contracts
or currency options. Currency derivatives belonging to
hedge accounting are managed in a separate portfolio than
derivatives hedging other commercial flows and funding
and cannot thus be netted out against other internal items.
These instruments are used when the hedging effect cannot
be obtained through internal netting and matching of cash
flows within the Group.
The business units’ commercial bids in a foreign currency can
be hedged by using currency options or exchange forwards,
but, in general, using currency clauses covers the risk.
For certain large crane projects, the Group applies hedge
accounting under IAS 39. Hedges are done by using
foreign exchange forward contracts. Currently, only USD
denominated projects are included in the hedge accounting.
The hedge accounting portfolio comprises both USD sales
and purchases where gross flows are hedged separately.
At the end of 2022, the hedge accounting net cash flows
totaled USD 338 million (USD 201 million in 2021).
The following table shows the transaction exposure of
Konecranes Finance Corporation as of December 31, 2022,
and December 31, 2021 (in EUR millions):
2022 2021
AED 1 1
AUD 57 38
BRL 3 5
CAD 36 20
CHF 4 3
CLP 1 1
CNY -35 -2
CZK -15 12
DKK 8 5
GBP 85 53
HUF -3 0
IDR 8 9
INR 2 3
JPY 1 2
KZT -1 0
MXN -2 -1
MYR 14 4
NOK 2 2
PHP 5 3
PLN 1 0
RON 1 0
SEK -181 -131
SGD -27 -10
THB 6 4
TWD 0 1
USD 427 284
VND 1 2
ZAR 4 6
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2022 2021
AED 10 11
AUD 12 10
BDT 1 1
BRL 19 14
CAD 11 12
CHF 9 3
CLP 11 8
CNY 90 124
CZK 10 9
DKK 6 6
GBP -18 -19
HKD 1 0
HUF 3 3
INR 8 5
IDR 17 19
JPY -8 -8
MAD 2 2
MXN 1 2
MYR 11 14
NOK 1 1
PEN 6 6
PHP 4 6
PLN 2 1
RON 2 2
RUB 6 7
SAR -2 -1
SGD 5 -37
SEK -10 -6
THB 15 18
TRY -1 0
TWD 4 4
UAH -1 2
USD 57 33
VND 1 1
ZAR 4 2
The following table shows the translation exposure, which
represents the equity of the Group in a local currency
as of December 31, 2022, and December 31, 2021
(in EUR millions):
See note 34 for the notional and fair values of derivative
financial instruments.
Changes in currency rates can affect the profitability and
equity of the Group. The US dollar has the biggest impact,
as many of the large crane projects outside the United
States are denominated in USD and because the Group has
a lot of local business operations in the United States. A
depreciation of the USD would have a negative impact.
The following table shows the theoretical effects that
changes in the EUR/USD exchange rate would have on
the Group’s annual EBIT and equity. An appreciation of US
dollar against euro for 10 % increases EBIT by EUR 48.9
million (36.9 million in 2021) and increases equity by EUR
6.4 million (3.6 million in 2021). The below table provides a
sensitivity analysis over the past two years:
Change in
EUR/USD
rate
2022
EBIT
2022
Equity
2021
EBIT
2021
Equity
+10% -40.0 -5.3 -30.2 -2.9
-10% +48.9 +6.4 +36.9 +3.6
The EBIT effect comprises transaction exposure for euro-
based companies having frequent sales in USD and the
translation exposure from EBIT generated in USD translated
into euros. The transaction position is estimated for 2022
as the USD positions change from one year to another
and these changes are mainly due to timing of major
ports projects and currencies used in them. The estimate
of the effects is based on the assumption that the USD
denominated transactions are not hedged. In practice,
however, all large projects with long maturities generating a
substantial portion of the annual changes in the transaction
position are hedged and subject to project specific pricing
and the sensitivity changes based on the net exposure
of the outstanding payables and receivables at the year
end 2022 are not material. The change in equity is the
translation exposure on the Group’s equity in USD.
Appreciating US dollar has a positive impact on Group’s
operating margin when it impacts the revenues and costs
reported in euros asymmetrically. This is due to the fact
that the exchange rate change impacts mostly both Group’s
revenues and costs and partly only either of these. If the
EBIT generated in USD based entities as well as cash flows
from long lasting projects, as they are subject to project
specific pricing which in practice may be adjusted to reflect
the currency rate changes, are excluded from the sensitivity
analysis the effect on EBIT is estimated to be approximately
a EUR 12 million increase (EUR 9 million in 2021) when the
dollar appreciates 10 percent.
Interest rate risk
Changes in market interest rates have an impact on the
Group’s net interest expenses and the market value of
interest rate derivatives. The objective for interest rate risk
management is to reduce the volatility impact the market
interest rate changes cause by optimizing the allocation
between fixed and floating interest rates according to
principles set in capital structure management.
Approximately 94% of the Group’s interest-bearing liabilities
are denominated in euro (92% in 2021). See note 27.3 for
the currency split of outstanding debt.
The portion of the Group’s long-term debt of total debt is
related to the Group’s gearing ratio. The higher the ratio
is, the bigger the share of long-term debt should be of the
total loan portfolio in line with principles set in the capital
structure management. The interest rate risk related to long
term loans may be hedged with interest rate derivatives
such as interest rate swaps for which hedge accounting is
applied. Other instruments that can be used for which no
hedge accounting is applied are forward rate agreements,
interest rate futures and interest rate options.
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A change of one percentage point in interest rates in the
Group’s long-term debt portfolio would have the following
effect on the Group’s income statement and equity:
Change in
interest
rates
2022
Income
statement
2022
Equity
2021
Income
statement
2021
Equity
+1 -7.5 +2.8 -3.6 +0.0
- 1 +7.8 -3.0 +0.9 -0.0
The sensitivity analysis is excluding the interest-bearing
assets. The effect on income statement is comprised of the
Group’s floating long-term debt which is recognized through
the statement of income. The effect on equity is comprised
of the changes in fair value of interest rate derivatives,
measured through other comprehensive income, which are
hedging the debt portfolio.
Commodity risk
By using fuel oil derivatives, the Group may reduce the
negative effect caused by oil price fluctuation. The overall
importance of the energy price risk is small compared
to other financial risks and cannot be described
as significant.
See note 34 for the notional and fair values of derivative
financial instruments.
Steel prices are fixed as a normal part of the procurement
process. Price changes naturally affect the future
procurement, but these changes can be taken into
consideration in the price quotes to the end customers.
In large crane projects, the steel structures are subcontracted
and as a normal part of the subcontracting process, the steel
is included in the price of the subcontracting (i.e. the price is
fixed with the subcontractor).
The Group can procure steel and steel components and thus
may have an inventory of those. Market price fluctuation of
steel can impact the profitability of customer projects or
cause inventory obsolescence.
33.2. Credit and counterparty risks
Credit risk arises from the potential failure of a commercial
counterparty to meet its commercial payment obligations.
To limit this risk, the Group applies a conservative credit
policy towards customers. It is Konecranes practice to
review customers carefully before entering into formal
business relationships and to require credit reports from
new customers. Customer credit risks are mitigated with
advance payments, letters of credits, payment guarantees
and credit insurance where applicable. With these actions
and careful monitoring of the customer payments credit
risks can be mitigated.
The business units manage credit risks related to their
commercial flows. There is currently no significant
concentration of credit risk regarding the commercial
activities, as the number of customers is high and their
geographic distribution is wide. It is the Group’s policy
not to fund its customers beyond regular payment terms.
See note 19 for a table of an aging analysis of accounts
receivable. The theoretical maximum credit risk equals the
carrying amount of all receivables.
Counterparty risk arises from the potential failure of
a financial institution to meet its payment obligations
regarding financial instruments. All credit risks related
to other financial instruments than the regular accounts
receivable are managed by Konecranes Group Treasury.
There is no substantial concentration of credit risk
regarding the financial instruments, since investments
are rare and hedging instruments are done with a
number of banks. Additionally, counterparties for
financial instruments are limited to the core banks of
the Group. These are all major banks with good credit
ratings. The majority of all financial instruments are of
short-term nature, with maturity of less than one year.
There are no significant deposits or loans granted with
external counterparties.
The Group has counterparty risk in form of cash holdings
in several banks around the world. Despite the active
cash management structures the Group has in place, cash
holdings globally with several banks are needed to ensure
the liquidity of Group companies. The Group Treasury
follows closely the exposure in the Group according to
principles set out in the Treasury Policy and takes necessary
actions for reducing the risk.
A credit risk is run on the financial assets of the Group,
which consist of cash and cash equivalents, receivables
and certain derivatives arising from default of the other
party, with a maximum risk equal to the carrying amount of
these instruments.
33.3. Liquidity risks
Liquidity risks concern the availability of liquid assets or
funding. Lack of funding might jeopardize normal business
operations and eventually might endanger the ability to
fulfill daily payment obligations.
For managing the liquidity risks, the Group has established
EUR 400 million committed revolving credit facility with an
international loan syndication (2017–2024). At the end of
2022 the facility was unutilized. To cover the short-term
funding needs, Konecranes Finance Corporation can borrow
from institutional investors through domestic commercial
paper program (totaling EUR 500 million). In addition,
business units around the world have working capital
facilities totaling some EUR 270 million to cover the day-
to-day funding needs. Cash and cash equivalents totalled
EUR 417.8 million at the end of 2022 (EUR 323.5 million in
2021).
See note 27.3 for the maturity profile of the Group’s
financial liabilities.
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33.4. Capital structure management
The primary objective of the Group’s capital structure
management is to ensure that it maintains a good credit
status and a healthy capital ratio to support its business
operations. At the same time, the Group also aims to
maximize shareholder value by effective use of capital.
The Group manages its capital structure and fine-tunes it to
adjust to probable changes in economic conditions. These
actions may include adjusting the dividend payment to
shareholders, buying back own shares or issuing new shares.
The Group monitors its capital structure using gearing ratio.
This is calculated as a ratio of interest-bearing liabilities less
liquid assets less loans receivable to total equity. At the end
of 2022, the gearing ratio was 48.0% (39.8% in 2021).
The Group has a quantitative target for the capital structure
in which the Interest-bearing net debt to equity ratio
(gearing) should be below 80%.
The Group decides on the split between long-term and short-
term debt in relation to the gearing ratio level. The following
table shows the rough guidelines for the portion of long–term
debt of total debt under different gearing ratio levels:
Gearing ratio level
Portion of long–term
of total debt
Under 50% Under 1/3
Between 50–80% Between 1/3 and 2/3
Over 80% Over 2/3
The Group monitors the gearing ratio level on a weekly
basis. The target of the Group’s capital management has
been met in recent years.
34. Hedge activities and derivatives
Derivatives are initially recorded in the balance sheet at
fair value and subsequently measured at fair value at each
balance sheet date. All derivatives are carried as assets
when fair value is positive and liabilities when fair value is
negative. Derivative instruments that are not designated as
hedges (hedge accounting) are measured at fair value, and
the change in fair value is recognized in the consolidated
statement of income. When the derivative is designated
as a cash-flow hedge (hedge accounting) the effective
part of the change in fair value is recognized in other
comprehensive income. Any ineffective part is recognized in
the consolidated statement of income. The foreign exchange
forward contracts are measured based on the closing
date’s observable spot exchange rates and the quoted yield
curves of the respective currencies. Interest rate swaps are
measured based on present value of the cash flows, which
are discounted based on the quoted yield curves.
34.1. Nominal and fair values of derivative
financial instruments
2022
Nominal
value
2022
Fair
value
2021
Nominal
value
2021
Fair
value
Foreign exchange
forward contracts
1,609.6 26.1 1,060.1 -13.4
Interest rate
derivative
300.0 1.8 88.4 0.0
Fuel oil derivative 1.7 -0.1 1.4 0.1
Total 1,911.3 27.8 1,149.9 -13.3
Derivatives not designated as hedging instruments
The Group also enters into other derivatives, foreign
exchange or currency options with the intention of reducing
the risk in expected sales and purchases, these other
contracts are not designated in hedge relationships and are
measured at fair value through profit or loss.
See note 32.3 for the fair values of the derivatives recognized in assets
and liabilities.
Cash flow hedges
Foreign currency and interest risk
Foreign exchange forward contracts and interest rate swaps
measured at fair value through OCI are designated as
hedging instruments in cash flow hedges of forecast sales
and purchases in US dollar and interest expenses. These
forecast transactions are highly probable, and they comprise
about 35.5% of the Group’s total hedged transaction flows.
The foreign exchange forward contract balances vary with
the level of expected foreign currency sales and purchases
and changes in foreign exchange forward rates.
At the inception of these deals the Group assess whether
the critical terms of the foreign currency forward contracts
and interest rate swaps match the terms of the expected
highly probable forecast transactions. On a quarterly
basis the Group performs qualitative effectiveness test
by checking that the hedging instrument is linked on
the relevant assets and liabilities, projected business
transactions or binding contracts according to the hedging
strategy and that there are no related credit risks. Hedge
ineffectiveness is recognized through profit or loss.
The cash flow hedges of the expected future sales,
purchases and interest expenses in 2022 and 2021 were
assessed to be highly effective and a net unrealized gain
or loss, with a deferred tax asset relating to the hedging
instruments, is included in OCI. The amounts recognized in
OCI are shown in the table below and the reclassifications
to profit or loss during the year are as shown in the
consolidated statement of income.
34.2. Fair value reserve of cash flow hedges
2022 2021
Balance as of January 1 -2.8 6.0
Gains and losses deferred to equity
(fair value reserve)
2.0 -11.0
Change in deferred taxes -0.4 2.2
Balance as of December 31 -1.2 -2.8
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Company list
(1,000 EUR)
Subsidiaries owned
by the parent company
Book
value of
shares
Parent
company’s
share, %
Group’s
share, %
Finland: Konecranes Finance Oy 46,448 100 100
Konecranes Finland Oy 17,163 26.02 100
Konecranes Global Oy 102,391 100 100
Subsidiaries
owned by the group
Book value
of shares
Group’s
share, %
Australia: Konecranes and Demag Pty Ltd 22,172 100
MHE-Demag Australia Pty Ltd 16,858 100
Austria: Konecranes and Demag Ges.m.b.H. 29,775 100
Bangladesh: Konecranes and Demag (Bangladesh) Ltd. 111 100
Belgium: S.A. Konecranes N.V. 6,150 100
Brazil: Konecranes Demag Brasil Ltda. 32,688 100
Canada: Konecranes Canada Inc. 893 100
Chile: Konecranes Chile SpA 1 100
China: Cranes and Parts Trading (Shanghai) Co., Ltd. 5,862 100
Dalian Konecranes Company Ltd. 2,343 100
Demag Cranes & Components (Shanghai) Co., Ltd. 14,349 100
Konecranes (Shanghai) Co. Ltd. 0 100
Konecranes (Shanghai) Company Ltd. 4,499 100
Konecranes Manufacturing (Jiangsu) Co., Ltd. 29,637 100
Konecranes Port Machinery (Shanghai) Co., Ltd. 7,623 100
SWF Krantechnik Co., Ltd. 833 100
Czech Republic: Konecranes and Demag s.r.o. 2,823 100
Denmark: Konecranes Demag A/S 12,531 100
Estonia: Konecranes Oü 0 100
Finland: Nosturiexpertit Oy 10 100
France: KCI Holding France SAS 40,500 100
Konecranes (France) SAS 3,752 100
MHPS Cranes France SAS 13,180 100
Verlinde SAS 10,720 100
Germany: Demag Cranes & Components GmbH 744,202 100
Eurofactory GmbH 1,239 100
Konecranes GmbH 483,804 100
Konecranes Holding GmbH 315,262 100
Konecranes Noell GmbH 37,501 100
Konecranes Real Estate GmbH Co. & KG 36,364 100
Konecranes Real Estate Verwaltungs GmbH 28 100
Kranservice Rheinberg GmbH 1,492 100
SWF Krantechnik GmbH 15,500 100
(1,000 EUR)
Subsidiaries
owned by the group
Book value
of shares
Group’s
share, %
Greece:
Konecranes Hellas Lifting Equipment and Services
S.A.
60 100
Hong Kong: Konecranes Hong Kong Limited 0 100
Hungary: Konecranes Kft. 889 100
Konecranes Supply Hungary Kft. 1,856 100
India: Konecranes and Demag Private Limited 17,434 100
Indonesia: PT. Konecranes 2,505 100
PT MHE-Demag Indonesia 3,600 100
PT MHE-Demag Technology Indonesia 304 67
Ireland: Konecranes and Demag Limited 300 100
Israel: Konecranes Israel Ltd 0 100
Italy: Demag Cranes & Components S.r.l. 13,997 100
Donati Sollevamenti S.r.l. 2,561 100
MHPS Italia S.r.l. 0 100
Japan: Konecranes Company, Ltd. 0 100
Latvia: SIA Konecranes Latvija 2 100
Lithuania: UAB Konecranes 139 100
Luxembourg: Materials Handling International S.A. 300 100
Malaysia: Konecranes Sdn. Bhd. 534 100
Mechanical Handling Engineering (M) Sdn Bhd 427 100
MHE-Demag Logistics Malaysia Sdn Bhd 2,669 100
MHE-Demag Malaysia Sdn Bhd 7,003 100
Rainfields Estate Sdn Bhd 1,299 100
Mexico: Konecranes Mexico S.A. de C.V. 2,188 100
Morocco: Konecranes Maghreb S.a.r.l. 50 100
The
Netherlands:
Konecranes B.V. 4,201 100
Konecranes Holding B.V. 313,851 100
Port Software Solutions B.V. 37,412 100
TBA B.V. 3,678 100
Norway: Konecranes AS 3,588 100
Peru: Konecranes Peru S.R.L. 0 100
Philippines: MHE-Demag (P), Inc. 5,826 100
Poland: Konecranes and Demag Sp. z o.o. 1,359 100
Portugal: Konecranes and Demag, Lda. 3,293 100
Romania: S.C. Konecranes S.A. 98 100
S.C. TBA RO S.r.l. 10 100
Russia: AO "Konecranes Demag Rus" 0 100
Saudi Arabia: Saudi Cranes & Steel Works Factory Co. Ltd. 9,635 100
112
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CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
(1,000 EUR)
Subsidiaries
owned by the group
Book value
of shares
Group’s
share, %
Singapore: KCI Cranes Holding (Singapore) Pte. Ltd. 114,764 100
MHE-Demag (S) Pte. Ltd. 199,621 100
Slovakia: Konecranes Slovakia s.r.o. 200 100
Slovenia: Konecranes, d.o.o. 200 100
South Africa: Konecranes and Demag (Pty) Ltd. 0 100
Port Equipment Southern Africa (Pty) Ltd 0 100
Spain: Konecranes and Demag Ibérica, S.L.U. 31,799 100
Sweden: Konecranes AB 1,229 100
Konecranes Lifttrucks AB 20,892 100
Konecranes Sweden Holding AB 1,682 100
Ulvaryd Fastighets AB 1,168 100
Switzerland: Konecranes and Demag AG 17,205 100
Taiwan: MHE-Demag Taiwan Company Limited 1,813 100
Thailand: Katrolin Enterprise (T) Ltd 86 100
Katrolin Holding (T) Ltd 98 100
Konecranes (Thailand) Ltd.* 118 49
Mahakorn (T) Ltd 83 100
MHE-Demag (T) Ltd 301 100
MHE-Demag Technology (T) Ltd 260 100
Scenic Wealth (T) Ltd 144 100
Turkey: Konecranes Ticaret Ve Servis Limited Sirketi 93 100
Ukraine: Konecranes Ukraine JSC 2,049 100
PJSC "Zaporozhje Kran Holding" 204 100
JSC "Zaporozhcran" 0 90.43
United Arab
Emirates:
Demag Cranes & Components Holding Ltd. 0 100
Demag Cranes & Components (Middle East) FZE 14,991 100
Konecranes Middle East FZE 1,774 100
United
Kingdom:
KCI Holding UK Ltd. 13,656 100
Konecranes Demag UK Limited 6,387 100
Lloyds Konecranes Pension Trustees Ltd. 0 100
Morris Material Handling Ltd. 564 100
TBA Doncaster Limited 2,011 100
TBA Leicester Limited 10,342 100
UKMHPS Limited 39,198 100
U.S.A. Demag Cranes & Components Corp. 63,501 100
KCI Holding USA Inc. 53,901 100
Konecranes, Inc. 49,962 100
Konecranes Nuclear Equipment & Services, LLC 0 100
MMH Americas, LLC 0 100
Morris Material Handling, Inc. 66,978 100
R&M Materials Handling, Inc. 7,688 100
(1,000 EUR)
Subsidiaries
owned by the group
Book value
of shares
Group’s
share, %
Vietnam: Konecranes Vietnam Co., Ltd 0 100
MHE-Demag Vietnam Company Ltd 2,790 100
* Konecranes Group has the majority representation on the entity’s board of directors and approves all major
operational decisions and thereby Konecranes consolidates them in the Group’s financial statements.
Other shares and joint operations
Assets
value
Group’s
share, %
Estonia: AS Konesko 4,448 49.46
Finland: Kiinteistöosakeyhtiö Kuikantorppa 261 50
Investments accounted for using the equity method
Assets
value
Group’s
share, %
China: Guangzhou Technocranes Company, Ltd. 428 25
Jiangyin Dingli Shengshai High Tech Industrial Crane
Company, Ltd.
65 30
Shanghai High Tech Industrial Crane Company, Ltd. 2,925 28
Finland: Fantuzzi Noell Baltic Oy 388 25
France: Boutonnier Adt Levage S.A. 551 25
Levelec S.A. 228 20
Manulec S.A. 213 25
Manelec S.A.R.L. 106 25
S.E.R.E. Maintenance S.A. 255 25
Germany:
AQZ Ausbildungs- und Qualifizierungszentrum
Düsseldorf GmbH
0 30
The
Netherlands:
TBA Consultancy B.V. 773 49
Singapore: MHE-Demag Techonology (S) Pte. Ltd. 552 49.99
Switzerland: Demag IP Holdings GmbH 159 50
Thailand: CSA Crane Service Asia Company Ltd 74 49
United Arab
Emirates:
Crane Industrial Services LLC 1,074 49
Available-for-sale investments
Book value
of shares
Group’s
share, %
Finland: East Office of Finnish Industries Oy 50 5.26
Dimecc Oy 120 5.69
Kiinteistö Oy Pärjä 26 46.67
Levator Oy 0 19
Vierumäen Kuntorinne Oy 326 3.3
France: Heripret Holding SAS 53 19
Malaysia: Kone Products & Engineering Sdn. Bhd. 0 10
Venezuela: Gruas Konecranes CA 20 10
Others: 187
Total: 782
113
FINANCIAL REVIEW 2022
CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Parent company statement of income − FAS
(1,000 EUR)
Jan 1–Dec 31
2022
Jan 1–Dec 31
2021
Note:
2 Depreciation and impairments -184 -179
3 Other operating expenses -15,627 -48,913
Operating profit -15,810 -49,092
4 Financial income and expenses 81,669 35,841
Income before appropriations and taxes 65,859 -13,251
5 Appropriations 39,445 52,388
6 Income taxes -4,979 -362
Net income 100,325 38,775
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CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Parent company balance sheet − FAS
(1,000 EUR) Dec 31, 2022 Dec 31, 2021
Note:
ASSETS
NON-CURRENT ASSETS
Tangible assets
7 Machinery and equipment 364 547
364 547
8 Investments
Investments in Group companies 153,040 153,040
Other shares and similar rights of ownership 171 170
153,211 153,210
Total non-current assets 153,575 153,758
CURRENT ASSETS
Long-term receivables
Loans receivable from Group companies 763,780 1,043,232
763,780 1,043,232
Short-term receivables
Accounts receivable 0 10,988
Amounts owed by Group companies
Accounts receivable 4,397 4,538
10 Deferred assets 103,155 74,897
Other receivables 3,560 8,407
10 Deferred assets 374 2,703
111,485 101,534
Cash in hand and at banks 3 3
Total current assets 875,268 1,144,769
TOTAL ASSETS 1,028,843 1,298,527
(1,000 EUR) Dec 31, 2022 Dec 31, 2021
Note:
SHAREHOLDERS’ EQUITY
AND LIABILITIES
11 EQUITY
Share capital 30,073 30,073
Share premium account 39,307 39,307
Paid in capital 775,176 774,591
Retained earnings 81,367 141,510
Net income for the period 100,325 38,775
1,026,248 1,024,256
APPROPRIATIONS
Depreciation difference 0 65
LIABILITIES
Long-term liabilities
Loans payable - Intercompany 0 893
0 893
Current liabilities
12 Bond 0 249,841
Accounts payable 1,163 9,892
Liabilities owed to Group companies
Accounts payable 144 140
13 Accruals 0 2,102
Other short-term liabilities 71 1,001
13 Accruals 1,216 10,338
2,595 273,313
Total liabilities 2,595 274,206
TOTAL SHAREHOLDERS’ EQUITY AND
LIABILITIES
1,028,843 1,298,527
115
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CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Parent company cash flow − FAS
(1,000 EUR)
Jan 1–Dec 31
2022
Jan 1–Dec 31
2021
Cash flow from operating activities
Operating income -15,810 -49,092
Adjustments to operating profit
Depreciation and impairments 184 179
Group contributions from subsidiaries 52,340 58,320
Operating income before changes in net working capital 36,713 9,407
Change in interest-free short-term receivables 11,977 -4,435
Change in interest-free short-term liabilities -18,060 7,300
Change in net working capital -6,084 2,864
Cash flow from operations before financing items and taxes 30,630 12,271
Interest received 5,352 5,231
Interest paid -4,371 -4,514
Other financial income and expenses -1,969 -1,866
Income taxes paid -26 -5,049
Financing items and taxes -1,014 -6,198
NET CASH FROM OPERATING ACTIVITIES 29,616 6,073
(1,000 EUR)
Jan 1–Dec 31
2022
Jan 1–Dec 31
2021
Cash flow from investing activities
Investments in other shares -1 0
Capital expenditure and advance payments to tangible assets 0 -35
Dividends received 40,000 37,500
NET CASH USED IN INVESTING ACTIVITIES 39,999 37,465
Cash flow before financing activities 69,615 43,537
Cash flow from financing activities
Proceeds from share based payments and share issues 585 0
Repayments of long-term receivables 278,560 26,101
Repayments of long-term liabilities -249,841 0
Dividends paid -98,918 -69,638
NET CASH USED IN FINANCING ACTIVITIES -69,614 -43,537
CHANGE OF CASH AND CASH EQUIVALENTS 0 0
Cash and cash equivalents at beginning of period 3 3
Cash and cash equivalents at end of period 3 3
CHANGE OF CASH AND CASH EQUIVALENTS 0 0
116
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Notes to the parent company’s Financial Statement
1. Accounting principles
The financial statements of the company have been
prepared in euro and in accordance with accounting
principles generally accepted in Finland.
STATEMENT OF INCOME
(1,000,000 EUR)
2. Depreciation and impairments
2022 2021
Machinery and equipment 0.2 0.2
Total 0.2 0.2
2022 2021
Wages and salaries 3.2 3.3
Pension costs 0.5 0.5
Other personnel expenses 0.1 0.0
Other operating expenses 0.4 0.4
Total 4.2 4.2
2022 2021
Remuneration to Board 0.7 0.6
Other wages and salaries 2.5 2.7
Total 3.2 3.3
The average number of personnel 4 5
Auditors fees
Audit 0.7 0.6
Other services 0.1 0.0
Total 0.8 0.6
2022 2021
Financial income from
long-term investments:
Dividend income from Group companies 80.0 37.5
Dividend income total 80.0 37.5
Interest income from
long-term receivables:
From Group companies 5.2 5.2
Interest income from long-term
receivables total
5.2 5.2
Financial income from long-term
investments total
85.2 42.7
Interest and other financial income 0.0 0.1
Interest and other financial income
total
0.0 0.1
Interest expenses and other financial
expenses:
Other financial expenses 3.5 7.0
Interest expenses and other financial
expenses total
3.5 7.0
Financial income and expenses total 81.7 35.8
3. Other operating expenses
and personnel
Costs and expenses in the Statement of Income were
as follows:
Wages and salaries in accordance with the Statement
of Income:
4. Financial income and expenses
5. Appropriations
6. Income taxes
BALANCE SHEET
7. Machinery and equipment
2022 2021
Difference between planned
and untaxed depreciations
0.1 0.0
Group contributions received
from subsidiaries
39.4 52.3
Total 39.4 52.4
2022 2021
Taxes on appropriations 7.9 10.5
Taxes on ordinary operations -2.9 -10.1
Taxes from previous years 0.0 0.0
Total 5.0 0.4
2022 2021
Acquisition costs as of January 1 1.2 1.2
Increase 0.0 0.0
Acquisition costs as of December 31 1.2 1.2
Accumulated depreciation January 1 -0.7 -0.5
Accumulated depreciation -0.2 -0.2
Total as of December 31 0.4 0.5
The values of fixed assets are based on original acquisition
values. Depreciation periods, which are based on estimated
financial operating times, are as follows:
• Immaterial rights 5–10 years
• Machines and inventory 4–10 years
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8. Investments 11. Equity
9. Treasury shares
10. Deferred assets
12. Interest-bearing liabilities
14. Contingent liabilities
and pledged assets
15. Nominal and fair values of
derivative financial instruments
2022 2021
Acquisition costs as of January 1 153.2 153.2
Increase 0.0 0.0
Total as of December 31 153.2 153.2
2022 2021
Share capital as of January 1 30.1 30.1
Share capital as of December 31 30.1 30.1
Share premium account as of January 1 39.3 39.3
Share premium account
as of December 31
39.3 39.3
Paid in capital as of January 1 774.6 774.6
Increase 0.6 0.0
Paid in capital as of December 31 775.2 774.6
Retained earnings as of January 1 180.3 211.1
Dividend paid -98.9 -69.6
Retained earnings as of December 31 81.4 141.5
Net income for the period 100.3 38.8
Shareholders’ equity
as of December 31
1,026.2 1,024.3
Distributable equity
Paid in capital as of December 31 775.2 774.6
Retained earnings as of December 31 81.4 141.5
Net income for the period 100.3 38.8
Total 956.9 954.9
2022 2021
Number of shares as of January 1 87,447 87,447
Decrease -32,140 0
Number of shares as of December 31 55,307 87,447
2022 2021
Group contributions 39.4 52.3
Income taxes 3.5 8.4
Payments which will be realized during
the next financial year
61.9 22.7
Interest 2.4 2.6
Total 107.1 86.0
2022 2021
Bond, short-term 0.0 249.8
Total 0.0 249.8
2022 2021
For obligations of subsidiaries
Group guarantees 1,238.0 1,235.2
Leasing liabilities
Next year 0.5 0.5
Later on 0.1 0.5
Total 0.6 0.9
2022 2022 2021 2021
Fair
value
Nominal
value
Fair
value
Nominal
value
Foreign exchange
forward contracts
0.0 1.6 0.0 0.0
2022 2021
Total by category
Guarantees 1,238.0 1,235.2
Other liabilities 0.6 0.9
Total 1,238.6 1,236.2
2022 2021
Domicile
Carrying
amount
Carrying
amount
Konecranes Finance Corp. Hyvinkää 46.4 46.4
Konecranes Finland Corp. Hyvinkää 4.2 4.2
Konecranes Global Corp. Hyvinkää 102.4 102.4
Total 153.0 153.0
2022 2021
East Office of Finnish Industries Oy 0.1 0.1
Dimecc Oy 0.1 0.1
China Office of Finnish
Industries
0.0 0.0
Total 0.2 0.2
Investments in Group companies
Other shares and similar rights of ownership
Leasing contracts mainly have a maturity of three years
and they have no terms of redemption.
Derivatives are used for currency rate hedging only.
The derivative financial instruments are recognized
according to KPL 5:2a at fair value in the parent company
financial statements and the company does not apply hedge
accounting for these derivatives.
A EUR 250 million bond was issued on June 9, 2017 and it
matured on June 9, 2022. The bond had a three-month per
call and an annual coupon rate of 1.75%.
13. Accruals
2022 2021
Wages, salaries and other personnel
expenses
1.0 1.9
Interest 0.0 2.5
Other items 0.2 8.0
Total 1.2 12.4
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CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Board of Directors’ proposal to the Annual General Meeting
The parent company’s non-restricted equity is EUR 956,868,289.67 of which the net income for the year is
EUR 100,324,987.85.
The Group’s non-restricted equity is EUR 1,364,732,000.
According to the Finnish Companies Act, the distributable funds of the company are calculated based on the parent
company’s non-restricted equity. For the purpose of determining the amount of the dividend the Board of Directors has
assessed the liquidity of the parent company and the economic circumstances subsequent to the financial year-end.
Based on such assessments the Board of Directors proposes to the Annual General Meeting that a dividend of EUR 1.25
will be paid on each share and that the remaining non-restricted equity is retained in shareholders’ equity.
Espoo, February 1, 2023
Christoph Vitzthum
Chairman of the Board
Pauli Anttila
Board member
Ulf Liljedahl
Board member
Per Vegard Nerseth
Board member
Päivi Rekonen
Board member
Anders Svensson
CEO
Pasi Laine
Vice chairman
Janina Kugel
Board member
Niko Mokkila
Board member
Sami Piittisjärvi
Board member
Helene Svahn
Board member
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CORPORATE GOVERNANCE STATEMENT 2022 REMUNERATION RISK MANAGEMENT FINANCIAL REVIEW
Auditor’s report
(Translation of the Swedish original)
To the Annual General Meeting of Konecranes Plc
Report on the Audit of Financial Statements
Opinion
We have audited the financial statements of Konecranes
Plc (business identity code 0942718-2) for the year ended
December 31, 2022. The financial statements comprise the
consolidated balance sheet, statement of income, statement
of comprehensive income, statement of changes in equity,
statement of cash flows and notes, including a summary
of significant accounting policies, as well as the parent
company’s balance sheet, income statement, statement of
cash flows and notes.
In our opinion
• the consolidated financial statements give a true and
fair view of the group’s financial position as well as its
financial performance and its cash flows in accordance
with International Financial Reporting Standards (IFRS)
as adopted by the EU.
• the financial statements give a true and fair view of the
parent company’s financial performance and financial
position in accordance with the laws and regulations
governing the preparation of financial statements in
Finland and comply with statutory requirements.
Our opinion is consistent with the additional report
submitted to the Audit Committee.
Basis for Opinion
We conducted our audit in accordance with good auditing
practice in Finland. Our responsibilities under good
auditing practice are further described in the Auditor’s
Responsibilities for the Audit of the Financial Statements
section of our report.
We are independent of the parent company and of
the group companies in accordance with the ethical
requirements that are applicable in Finland and are
relevant to our audit, and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
In our best knowledge and understanding, the non-audit
services that we have provided to the parent company
and group companies are in compliance with laws and
regulations applicable in Finland regarding these services,
and we have not provided any prohibited non-audit services
referred to in Article 5 (1) of regulation (EU) 537/2014.
The non-audit services that we have provided have been
disclosed in note 7.1 to the consolidated financial statements
and note 3 to the parent company financial statements.
We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the
financial statements of the current period. These matters
were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters.
We have fulfilled the responsibilities described in the
Auditor’s Responsibilities for the Audit of the Financial
Statements section of our report, including in relation
to these matters. Accordingly, our audit included the
performance of procedures designed to respond to our
assessment of the risks of material misstatement of the
financial statements. The results of our audit procedures,
including the procedures performed to address the matters
below, provide the basis for our audit opinion on the
accompanying financial statements.
We have also addressed the risk of management override
of internal controls. This includes consideration of whether
there was evidence of management bias that represented
a risk of material misstatement due to fraud.
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Key Audit Matter How our audit addressed the Key Audit Matter
Revenue recognition of long-term contracts
and related provisions
Refer to note 2.2 Use of estimates and judgments,
note 2.3 Summary of significant accounting
policies, note 5, note 6 and note 24.
In accordance with its accounting principles,
Konecranes applies the percentage of completion
(PoC) method (performance obligations satisfied
over time) for recognizing revenue from long-term
crane projects. The percentage of completion is
based on the cost-to-cost method.
The percentage of completion method of accounting
involves the use of significant management
assumptions, estimates and projections, principally
relating to future material, labor and project-
related overhead costs and the estimated stage
of completion. In year 2022, approximately 9
% percent of the sales of 3.4 billion euro were
recognized under the PoC method. Revenue
recognition of long-term contracts is a key audit
matter and a significant risk of misstatement as
defined by EU Regulation No 537/2014, point (c)
of Article 10(2).
Konecranes makes several types of provisions
related to risks associated with long-term project
contracts and PoC accounting. These PoC related
provisions require high level of management
judgment and are a key audit matter due to that
reason.
Our audit procedures to address the risk of material
misstatement in respect of the long-term contracts
included among others:
• Assessing the Group’s accounting policies over
revenue recognition of long-term contracts;
• Gaining an understanding of the PoC revenue
recognition process;
• Examination of the project documentation
and testing the PoC calculations and inputs of
estimates in the calculations and comparing the
estimates to actuals;
• Analytical procedures;
• Assessing significant judgments made by
management based on an examination of the
associated project documentation and discussion
on the status of projects under construction with
finance and project managers of the Company;
and
• Assessing the Group’s disclosures in respect of
revenue recognition.
We have designed our audit procedures to be
responsive to this specific audit area and our
procedures included among others:
• Gaining an understanding of the PoC related
provisions process;
• Testing the provision calculations and the inputs
of estimates in these calculations and comparing
estimates to actuals; and
• Performing inquiries with management with
regards to any significant events or legal matters
that could affect the provisions.
Key Audit Matter How our audit addressed the Key Audit Matter
Revenue recognition
Refer to note 2.3 Summary of significant
accounting policies and note 5.
According to the Group’s accounting policies
revenue is recognized at an amount of
consideration to which the Group expects to be
entitled in exchange for transferring promised
goods or services to a customer. Goods and
services are generally considered to be transferred
when the customer obtains control. The terms and
conditions of sales contracts vary by market and, in
addition, the local management might feel pressure
to achieve the revenue targets set.
Revenue recognition is a key audit matter and a
significant risk of material misstatement as defines
by EU Regulation No 537/2014, point (c) of Article
10(2) due to the significant risk relating to an
incorrect timing of recognition of revenue.
Our audit procedures to address the risk of material
misstatement in respect of correct timing of
revenue recognition included among others:
• Analytical procedures;
• Assessing the Group’s accounting policies over
revenue recognition compared to applicable
accounting standards;
• Assessing the revenue recognition process and
–methodologies and testing controls;
• Testing revenue with substantive analytical
procedures and by testing sales transactions;
• Assessing the Group’s disclosures in respect of
revenues.
Valuation of goodwill
Refer to note 2.2 Use of estimates and judgments,
note 2.3 Summary of significant accounting policies
and note 13.
The value of goodwill at the date of the financial
statements on 31 Dec 2022 amounted to 1.0 billion
euros representing 23 % of total assets and 71 %
of equity (2021: 1.0 billion euro, 27% of the total
assets and 75 % of equity).
Valuation of goodwill is tested annually through
goodwill impairment test. Konecranes has allocated
goodwill to cash generating units (CGUs) which
is the level for goodwill impairment test. The
recoverable amount of a cash generating unit is
based on value in use calculations, the outcome
of which could vary significantly if different
assumptions were applied. There are a number of
assumptions used to determine the value in use
of the cash generating units, including revenue
growth, development of fixed costs, the operating
margin and the discount rate applied. Changes in
the above-mentioned assumptions may result in an
impairment of goodwill.
Our audit procedures to address the risk of
material misstatement relating to goodwill
valuation included among others, involving our
valuation specialists to assist us in evaluating
the assumptions and methodologies used by
the Group, in particular those relating to the
discount rate. We specifically focused on the
cash generating units for which reasonably
possible changes in assumptions could cause
the carrying value to exceed its recoverable
amount. We also assessed the historical accuracy
of managements’ estimates. We assessed the
Group’s disclosures in note 13 in the financial
statements about the assumptions to which
the outcome of the impairment tests were
more sensitive.
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Key Audit Matter How our audit addressed the Key Audit Matter
The annual impairment test is a key audit matter
because
• The assessment process is complex and is based
on numerous judgmental estimates;
• It is based on assumptions relating to market or
economic conditions; and
• Of the significance of the goodwill to the balance
sheet total.
Valuation of goodwill is a significant risk of
misstatement as defined by EU Regulation No
537/2014, point (c) of Article 10(2).
Responsibilities of the Board of Directors and the
Managing Director for the Financial Statements
The Board of Directors and the Managing Director are
responsible for the preparation of consolidated financial
statements that give a true and fair view in accordance
with International Financial Reporting Standards (IFRS)
as adopted by the EU, and of financial statements that
give a true and fair view in accordance with the laws
and regulations governing the preparation of financial
statements in Finland and comply with statutory
requirements. The Board of Directors and the Managing
Director are also responsible for such internal control as
they determine is necessary to enable the preparation
of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors
and the Managing Director are responsible for assessing the
parent company’s and the group’s ability to continue as going
concern, disclosing, as applicable, matters relating to going
concern and using the going concern basis of accounting.
The financial statements are prepared using the going
concern basis of accounting unless there is an intention
to liquidate the parent company or the group or cease
operations, or there is no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit
of the Financial Statements
Our objectives are to obtain reasonable assurance on
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance
with good auditing practice will always detect a material
misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually
or in aggregate, they could reasonably be expected
to influence the economic decisions of users taken on
the basis of the financial statements.
As part of an audit in accordance with good auditing
practice, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of
the financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those
risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk
of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to
the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of the
parent company’s or the group’s internal control.
• Evaluate the appropriateness of accounting policies used
and the reasonableness of accounting estimates and
related disclosures made by management.
• Conclude on the appropriateness of the Board of
Directors’ and the Managing Director’s use of the going
concern basis of accounting and based on the audit
evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant
doubt on the parent company’s or the group’s ability
to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures
in the financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of
our auditor’s report. However, future events or conditions
may cause the parent company or the group to cease to
continue as a going concern.
• Evaluate the overall presentation, structure and content
of the financial statements, including the disclosures,
and whether the financial statements represent the
underlying transactions and events so that the financial
statements give a true and fair view.
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• Obtain sufficient appropriate audit evidence regarding
the financial information of the entities or business
activities within the group to express an opinion on the
consolidated financial statements. We are responsible for
the direction, supervision and performance of the group
audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance
regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including
any significant deficiencies in internal control that we
identify during our audit.
We also provide those charged with governance with a
statement that we have complied with relevant ethical
requirements regarding independence, and communicate
with them all relationships and other matters that may
reasonably be thought to bear on our independence, and
where applicable, related safeguards.
From the matters communicated with those charged with
governance, we determine those matters that were of most
significance in the audit of the financial statements of the
current period and are therefore the key audit matters. We
describe these matters in our auditor’s report unless law or
regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a
matter should not be communicated in our report because
the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such
communication.
Other Reporting Requirements
Information on our audit engagement
We were first appointed as auditors by the Annual General
Meeting on March 8, 2006, and our appointment represents
a total period of uninterrupted engagement of 17 years.
Other information
The Board of Directors and the Managing Director are
responsible for the other information. The other information
comprises the report of the Board of Directors and the
information included in the Governance publication but
does not include the financial statements and our auditor’s
report thereon. We have obtained the report of the Board of
Directors prior to the date of this auditor’s report, and the
Governance publication is expected to be made available to
us after that date.
Our opinion on the financial statements does not cover the
other information.
In connection with our audit of the financial statements,
our responsibility is to read the other information identified
above and, in doing so, consider whether the other
information is materially inconsistent with the financial
statements or our knowledge obtained in the audit, or
otherwise appears to be materially misstated. With respect
to report of the Board of Directors, our responsibility also
includes considering whether the report of the Board
of Directors has been prepared in accordance with the
applicable laws and regulations.
In our opinion, the information in the report of the Board
of Directors is consistent with the information in the
financial statements and the report of the Board of Directors
has been prepared in accordance with the applicable
laws and regulations.
If, based on the work we have performed on the other
information that we obtained prior to the date of this
auditor’s report, we conclude that there is a material
misstatement of this other information, we are required to
report that fact. We have nothing to report in this regard.
Opinions based on assignment of the Audit Committee
We support that the financial statements should be
adopted. The proposal by the Board of Directors regarding
the use of the distributable equity shown in the balance
sheet for the parent company is in compliance with the
Limited Liability Companies Act. We support that the
Members of the Board of Directors and the Managing
Director of the parent company should be discharged from
liability for the financial period audited by us.
Helsinki, February 1, 2023
Ernst & Young Oy
Authorized Public Accountant Firm
Toni Halonen
Authorized Public Accountant
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Independent Auditor’s Report on Konecranes Plc’s ESEF-
Consolidated Financial Statements
(Translation of the Swedish original)
To the Board of Directors of Konecranes Plc
We have performed a reasonable assurance engagement on
the iXBRL tagging of the consolidated financial statements
included in the digital files 549300EF0CDEQZBMA096-
2022-12-31-sv.zip of Konecranes Plc for the financial year
January 1 – December 31, 2022 to ensure that the financial
statements are marked/tagged with iXBRL in accordance
with the requirements of Article 4 of EU Commission
Delegated Regulation (EU) 2018/815 (ESEF RTS).
Responsibilities of the Board of Directors
and Managing Director
The Board of Directors and Managing Director are
responsible for the preparation of the Report of Board
of Directors and financial statements (ESEF financial
statements) that comply with the ESESF RTS. This
responsibility includes:
• preparation of ESEF-financial statements in accordance
with Article 3 of ESEF RTS
• tagging the consolidated financial statements included
within the ESEF- financial statements by using the iXBRL
mark ups in accordance with Article 4 of ESEF RTS
• ensuring consistency between ESEF financial statements
and audited financial statements
The Board of Directors and Managing Director are also
responsible for such internal control as they determine
is necessary to enable the preparation of ESEF financial
statements in accordance with the requirements of ESEF RTS.
Auditor’s Independence and Quality Control
We are independent of the company in accordance with the
ethical requirements that are applicable in Finland and are
relevant to the engagement we have performed, and we
have fulfilled our other ethical responsibilities in accordance
with these requirements.
The auditor applies International Standard on Quality
Control (ISQC) 1 and therefore maintains a comprehensive
quality control system including documented policies and
procedures regarding compliance with ethical requirements,
professional standards and applicable legal and regulatory
requirements.
Auditor’s Responsibilities
In accordance with the Engagement Letter we will express an
opinion on whether the electronic tagging of the consolidated
financial statements complies in all material respects with
the Article 4 of ESEF RTS. We have conducted a reasonable
assurance engagement in accordance with International
Standard on Assurance Engagements ISAE 3000.
The engagement includes procedures to obtain evidence on:
• whether the tagging of the primary financial statements
in the consolidated financial statements complies in all
material respects with Article 4 of the ESEF RTS
• whether the tagging of the notes to the financial
statements and the entity identifier information in the
consolidated financial statements complies in all material
respects with Article 4 of the ESEF RTS
• whether the ESEF-financial statements are consistent
with the audited financial statements
The nature, timing and extent of the procedures selected
depend on the auditor’s judgement including the
assessment of risk of material departures from requirements
sets out in the ESEF RTS, whether due to fraud or error.
We believe that the evidence we have obtained is sufficient
and appropriate to provide a basis for our statement.
Opinion
In our opinion the tagging of the consolidated financial
statement included in the ESEF financial statement of
Konecranes Plc for the year ended December 31, 2022
complies in all material respects with the requirements of
ESEF RTS.
Our audit opinion on the consolidated financial statements
of Konecranes Plc for the year ended December 31, 2022 is
included in our Independent Auditor’s Report dated February
1, 2023. In this report, we do not express an audit opinion
any other assurance on the consolidated financial statements.
Helsinki 28.2.2023
Ernst & Young Oy
Authorized Public Accountant Firm
Toni Halonen
Authorized Public Accountant
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Company information for ESEF reporting
Domicile of entity Hyvinkää
Legal form of entity Publicly Listed Company
Country of incorporation Finland
Address of entity's registered office K oneenkatu 8, 05830 Hyvinkää, Finland
Principal place of business Hyvinkää
Description of nature of entity's
operations and principal activities
Konecr anes is a world-leading manufacturer and servicer of
cranes, lifting equipment and machine tools, serving a broad r ange
of customers, including manufacturing and process industries,
shipyards, ports and terminals. K onecranes operates internationally,
with its products being manufactured in North and South America,
Europe, Africa, the Middle East, and Asia and sold worldwide.
Konecr anes has three reportable segments: Service, Industrial
Equipment and Port Solutions.
Name of parent entity Konecr anes Plc
Name of ultimate parent of group Konecr anes Plc
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Shares and shareholders
Number of
shares
and votes
% of shares
and votes
1 Solidium Oy 8,000,000 10.1%
2 HC Holding Oy Ab 7,931,238 10.0%
3 Gustavson Stig and family* 2,366,157 3.0%
4 Ilmarinen Mutual Pension Insurance Company 2,100,000 2.7%
5 Varma Mutual Pension Insurance Company 1,785,293 2.3%
6 Holding Manutas Oy 1,065,000 1.3%
7 Elo Mutual Pension Insurance Company 1,025,000 1.3%
8 Nordea Funds 725,103 0.9%
9 Svenska Litteratursällskapet i Finland 724,000 0.9%
10 Samfundet Folkhälsan i Svenska Finland rf 615,600 0.8%
Ten largest registered shareholders' total ownership 26,337,391 33.2%
Nominee registered shares 28,253,413 35.7%
Other shareholders 24,575,795 31.0%
Shares held by Konecranes Plc 55,307 0.1%
Total 79,221,906 100.0%
Change in
shareholding
in 2022
Number
of shares
owned
% of
shares
and votes
Board of Directors 9,577 34,631 0.0%
Group Executive Board 6,635 162,796 0.2%
Total 16,212 197,427 0.2%
Shares
Number of
shareholders
% of
shareholders
Number of
shares
and votes
% of shares
and votes
1−100 33,052 57.5% 1,373,869 1.7%
101−1,000 21,489 37.4% 7,079,533 8.9%
1,001−10,000 2,682 4.7% 6,819,275 8.6%
10,001−100,000 169 0.3% 4,565,655 5.8%
100,001−1,000,000 25 0.0% 7,153,852 9.0%
1,000,001− 8 0.0% 23,976,309 30.3%
Registered shareholders total 57,425 100.0% 50,968,493 64.3%
Nominee registered shares 11 0.0% 28,253,413 35.7%
Total 57,436 100.0% 79,221,906 100.0%
% of shares
and votes
Households 21.3%
Public sector organizations 17.6%
Private companies 13.7%
Financial and insurance institutions 5.5%
Non-profit organizations 5.3%
Foreigners 1.0%
Nominee registered shares 35.7%
Total 100.0%
According to the register of K onecranes Plc’s shareholders kept by Euroclear Finland Oy, there
were 57,448 (2021: 49,299) shareholders at the end of the 2022.
Largest shareholders according to the share register on December 31, 2022
Shares owned by the members of the Board and of Directors and of the Group
Executive Board on December 31, 2022
Breakdown of share ownership by number or shares owned
on December 31, 2022
Breakdown of share ownership by shareholder category
on December 31, 2022
* Konecranes Plc has on December 28, 2011 received information according to which the Chairman of the
company’s Board of Directors Stig Gustavson has donated all of his shares in Konecranes Plc to his near relatives
retaining himself for life the voting rights and right to dividend attached to the donated shares. The donation
encompassed in total 2,069,778 shares.
Source: Euroclear Finland Oy, December 31, 2022.
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