2024-01-26 12:35:10 ET
KONE Oyj (KNYJF)
Q4 2023 Earnings Conference Call
January 26, 2024 03:30 ET
Company Participants
Sanna Kaje - Interim Head, Investor Relations
Philippe Delorme - President and Chief Executive Officer
Ilkka Hara - Chief Financial Officer
Conference Call Participants
Yifan Zhang - Goldman Sachs
James Moore - Redburn Atlantic
Andre Kukhnin - UBS
Andrew Wilson - JPMorgan
Aurelio Calderon - Morgan Stanley
Klas Bergelind - Citi
Panu Laitinmäki - Danske Bank
Ben Heelan - Bank of America
Tom Skogman - Carnegie
Vlad Sergievskii - Barclays
Nick Housden - RBC Capital Markets
Antti Kansanen - SEB
Presentation
Sanna Kaje
Good morning and welcome to KONE’s Q4 and Full Year 2023 Results Webcast. I am Sanna Kaje, KONE’s Interim Head of Investor Relations, while Natalia is on parental leave. I have here with me today our new President and CEO, Philippe Delorme, who will go through the quarter and full year highlights, and also, as usual, Ilkka Hara, our CFO, who will then dig deeper into the market dynamics and financials.
With that, Philippe, the floor is yours.
Philippe Delorme
Thank you very much, Sanna. Hi, everyone. It’s a pleasure to be here. So as you probably know, I’ve now been with the company for around a month, which is not very long. So I’m starting to discover what’s so great about this company. Of course, meeting a lot of people, meeting a lot of customers, but acknowledging that there is still a lot for me still to learn.
So now let’s look at the highlights of what we want to share with you. And I’m really happy that I get to start my role by being able to share with you that KONE had actually a pretty strong finish for 2023 and is well positioned for 2024. As a result of this, the Board is proposing to keep the dividend stable at €1.75 per Class B share. And for all of this, I really want to say a big thank you to everyone at KONE for making it happen. And I want to single out, of course, Henrik for all his super valuable support, making the transition smooth and actually bringing a very strong legacy to the company.
Now let’s dive into Q4. All in all, I think you’ve seen the figure already, but we are going to go into more detail. We had a strong finish to the year. Our orders, which is really a highlight, received very strong growth across all businesses and all areas. All together, we grew by 11% at comparable currency, and Ilkka will present in more detail the highlight of this. Our sales grew by 1% at comparable currency with no surprise, continued growth in service, very strong growth in modernization. New building Solutions has declined on the back of a weak construction market in many parts of the world. And with a good work on margin and cost, EBIT margin continue to improve and cash flow has been strong.
Now let’s look at the full year 2023. I would say we did well in a challenging market environment, and we’ve proven our resilience. So we saw improving momentum in orders received toward the latter part of the year. Q3 was strong. Q4 is strong again. And we’re able to take some market share, which is something we decided to do. Sales grew by 5% at comparable currencies, demonstrating the resilience of our business in a tough environment, and that came with a 150 basis points improvement in adjusted EBIT margin and a solid cash conversion. So all in all, I would say that we are on the right track....
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KONE Oyj (KNYJF) Q4 2023 Earnings Call Transcript