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INTERVIEW-UPDATE 1-Kone sure on outlook despite euro zone woes

Published 05/27/2010, 12:50 AM
Updated 05/27/2010, 12:51 AM

* 2010 order book very strong, reason for confidence

* Very few companies have cancelled orders due to euro crisis

* China most important market, very strong this year (Adds quotes, background)

By Farah Master

SHANGHAI, May 27 (Reuters) - Finnish lift and escalator maker Kone is upbeat about its profit and sales outlook for 2010 despite a worsening debt crisis in the euro zone, its chief executive said on Thursday.

Kone's order book for 2010 remains very strong with robust growth in the Asia-Pacific region, particularly China, Chief Executive Matti Alahuhta said in an interview.

"We have confidence for this year. We have a very strong order book, which is one of the big reasons why we have this forecast," Alahuhta said. He added that the company had very few cancellations of global orders in the past few months.

Alahuhta remained confident that the company, which builds elevators for skyscrapers, ships and airports, would achieve an operating profit of between 580 million euros ($705.6 million) and 620 million euros this year, a forecast made in April.

Kone's Asia-Pacific business accounts for about 17 percent of its global total, with China making up the bulk of that, he said.

"Demand in China this year has been very strong. Urbanisation has been and will be driving the Chinese market in a strong way, and therefore China is high on our priorities," Alahuhta said.

He declined to provide sales projections for China, but said the firm, which has sold elevators for use in high-profile buildings including Beijing's Bird's Nest stadium, was continuing to add new offices and employees there.

Kone currently employs 3,500 people in China, out of a global workforce of 54,000.

That growth will come in part by Kone's expanding into the country's relatively underdeveloped interior, where government policies supporting urbanisation will lead to more construction, Alahuhta said.

Kone shares closed up 3.7 percent at 30.88 euros on Wednesday.

(Editing by Ken Wills) ($1=.8220 Euro)

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