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KONE Capital Markets Day 2008

KONE Central and North EuropeNoud VeegerExecutive Vice President, Area Director Central & North Europe

2 May 7, 2008 © KONE Corporation l Capital Markets Day l Noud Veeger

Long-term profitable growth opportunities in Central & North Europe through

Urbanization

Modernization

New equipment leadership driving service market share


Agenda

Central and North Europe markets and KONE´s position

Key development actions

Long-term profitable growth opportunities


The Central and North Europe markets

HyvinkääHelsinki

Essen

Keighley

Global R&D centersProduction siteHead office

Usti nad Labem


Europe – growing dynamics between cities

0

100

200

300

400

500

600

1950 1970 1990 2010 2030

Rural Urban

Source: U.N. World Urbanisation Prospects 2007


Construction market development 2000-2012 in Central and North Europe

Source: Global Insight, Feb 2008

• 2007 Nominal construction output (Office, Commercial, Residential): EUR bn 374

NOTE: The figures presented in the graph are real bn EUR figures, converted from USD 2000 real figures using recent conversion rates

Office, commercial and residential construction activity, real EUR bn

0

50

100

150

200

250

300

350

400

2000 2001 2002 2003 2004 2005 2006 2007f 2008f 2009f 2010f 2011f 2012f

Office Commercial Residential


Markets in Central and North Europe Total new equipment market size in 2007, elevators + escalators

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Source: KONE


Markets in Central and North Europe Total elevators in service in units (LIS) in 2007

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Source: KONE


Ger

man

y

UK

Switz

erla

nd

Net

herla

nds

Finl

and

Sw

eden

Aust

ria

Nor

way

Cze

ch

Pol

and

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nd

Slov

ak R

epub

lic

Den

mar

k

Hun

gary

Slov

enia

Est

onia

Markets in Central and North Europe Total Modernization market size 2007, elevators & escalators

Source: KONE

Key development actions


KONE development actions - Customer Focus

CRM process implementation

Sales force training

E-business

Increasing equipment in service

Care-for-Life process


KONE development actions - Operational Excellence

Modular based maintenance

Installation productivity

Supply chain control

Reduction of callouts

Continuous fixed cost discipline


Products

Strong position in new equipment since the introduction of KONE MonoSpace®, the world’s first machine-room-less elevatorDesign– KONE DecoTM

– KONE FourSeasonsTM conceptModernization– KONE MaxiSpaceTM

– KONE ReGenerateTM

Double-deck elevators KONE PolarisTM


Central London offices under construction

Source: CB Richard Ellis, Central London Offices, Q1 2008

0

2

4

6

8

10

12

14

16

2000

Q1

2000

Q3

2001

Q1

2001

Q3

2002

Q1

2002

Q3

2003

Q1

2003

Q3

2004

Q1

2004

Q3

2005

Q1

2005

Q3

2006

Q1

2006

Q3

2007

Q1

2007

Q3

2008

Q1

Under Construction Available Committed


London - KONE is at the Heart of Change

http://www.john-lewis-partnership.co.uk/index.asp

http://www.britishland.com/page.aspx?pointerID=169345dwprEOVViTRLd8xXbHBDHGbzge

Long-term profitable growth opportunities


Modernization market

Population getting older

Buildings getting older

Legislation for safety of existing lifts

18 May 7, 2008 © KONE Corporation l Capital Markets Day l Noud Veeger Source: United Nations World Population Prospects: The 2006 Revision

Percentage of population aged 65 or older in Western Europe

15 %

16 %

19 %

23 %

26 %

28 %

10 %

12 %

14 %

16 %

18 %

20 %

22 %

24 %

26 %

28 %

30 %

2000 2010 2020 2030 2040 2050


Age distribution of the construction base in Central and North Europe

0 % 20 % 40 % 60 % 80 % 100 %

Austria

Czech Republic

Denmark

Estonia

Finland

Germany

Hungary

Ireland

Latvia

Lithuania

Netherlands

Poland

Slovak Republic

Slovenia

Sweden

United Kingdom

Over 6262-3837-28Less than 27

Source: Housing Statistics in the European Union 2005/2006© Ministry of Infrastructure of the Italian Republic, Federcasa


SNEL overview of National Legislations in Central and North Europe

Existing national laws (specifically UWED) cover part or all of SNEL points

Preparation for national laws to be started

National laws in preparation

National laws have been introduced


Eastern Europe

Urbanization

Increasing standard of living

Safety legislation


Warsaw

Krakow

Gdansk

Lodz

Wroclaw

Poznan

Szczecin

Eastern Europe – Case Poland

Poland

2005 2006 2007

New Elevator Business Market Size in Units

Source: KONE


Long-term profitable growth opportunities in Central & North Europe through

Urbanization

Modernization

New equipment leadership driving service market share