1:00PM New York - Kone Corporation fourth quarter earnings come in line with expectations; upbeat on outlook.

Revenue Review

Kone Corporation, the giant elevator and escalator firm, reported fourth quarter net sales climbed 13.2% to 1.29 billion euro compared with 1.14 billion euro posted in the year ago quarter.

In the quarter, the company received orders worth 901.9 million euro, up 26.7% from orders of 712.1 million euro a year earlier.

Orders valued at 3 674.7 million euro were received at year-end. For 2006, Kone received orders of 3 116.3 million euro.

For fiscal 2007, net sales rose 13.1% to 4.07 billion euro, from 3.60 billion euro in 2006. At comparable exchange rates, growth was 16%.

Earnings Review

Kone said quarterly net income rose 25.4% to 100.6 million euro from 80.2 million euro same period in 2006.

In the quarter, earnings gained 25% to 80 cents per share against 64 cents per share posted in prior year.

Per share earnings missed analysts estimates. Overall, however, the results were in line with expectations.

Analysts polled by Thomson Financial were looking for earnings of 92 cents per share on revenues of 1.296 billion euro.

Kone proposed a full-year dividend of 1.30 euro.

At year-end, the company said earnings fell 23.1% to 180.3 million euro or 1.44 euro per share compared with 234.4 million euro or 1.86 euro per share in the year ago quarter.

Operating income fell to 320.8 million euro from 360.1 million euro previously.

Kone said cash flow increase d to 116.7 million euro from 97.7 million euro in the quarter, and was up 2.5% at 380 million euro for fiscal 2007.

Earnings Guidance

Kone provided a positive outlook, banking future earnings growth on higher levels of urbanisation.

The company expects net sales to rise 10% in 2008. Operating income will increase 20%, said the company, which corresponds to an operating income of 12%.

“The expanding urban environments need an increasing number of solutions to move a growing number of people smoothly, safely, comfortably and efficiently,” said Kone president, and chief executive Matti Alahuhta.

“2007 was a very good year for KONE Corporation both in terms of operational financial performance and change progress. We achieved a high growth both in orders received and in operating income. I am particularly pleased that our year-on-year growth in orders received accelerated in Q4.”

KONE is one of the world’s leading elevator and escalator companies. KONE also provides maintenance services for automatic building doors.