KION GROUP AG: KION Group beats expectations for 2019 with a strong year end

2020-01-17 / 11:13:20

17 January 2020
Publication of inside information pursuant to Article 17 of Regulation (EU) No 596/2014

KION Group beats expectations for 2019 with a strong year end

As of today, preliminary, unaudited consolidated financial figures for 2019 are available to KION GROUP AG.

Despite a very difficult market environment, the KION Group's order intake rose by around 5 percent year-on-year and is likely to have reached around €9.1 billion (previous year: €8.7 billion). This was attributable to a very good level of orders at the end of the year in both of the Group's operating segments, Industrial Trucks & Services (IT&S) and Supply Chain Solutions (SCS). Order intake was thus above the level set out in the outlook for 2019 (€8.25 billion to €8.95 billion). Consolidated revenue jumped by almost 10 percent to reach around €8.8 billion (previous year: €8.0 billion) and was also higher than in the outlook (€8.15 billion to €8.65 billion). Both operating segments contributed to the increase in revenue.

Adjusted EBIT is likely to have gone up by around 8 percent to around €850 million (previous year: €790 million). The adjusted EBIT margin contracted slightly in 2019 to presumably around 9.6 percent (previous year: 9.9 percent). One of the main reasons for this was the disproportionately strong growth in the new truck business and project business, which have lower margins. Free cash flow amounted to around €565 million (previous year: €520 million), a year-on-year increase of around 9 percent. This was significantly higher than in the outlook (€380 million to €480 million). Free cash flow was driven by very healthy order intake in the Supply Chain Solutions segment and the resulting advance payments from customers.

In the Industrial Trucks & Services segment, orders for around 214 thousand new trucks were taken in 2019 (previous year: 217 thousand). The significant market slowdown meant that the segment was not fully able to match the very high figure reported for 2018 (down by 1.4 percent). The total value of order intake increased by almost 2 percent and is likely to be around €6.3 billion (previous year: €6.2 billion). Total segment revenue went up by almost 8 percent to around €6.4 billion (previous year: €5.9 billion) and was thus higher than in the outlook (€6.05 billion to €6.25 billion). Adjusted EBIT is expected to be around €693 million, a year-on-year improvement of around 6 percent (previous year: €655 million).

At around €2.8 billion in 2019, order intake in the Supply Chain Solutions segment was around 14 percent up on the figure reported for the prior year (€2.4 billion) and was much higher than in the outlook (€2.0 billion to €2.5 billion). Total segment revenue rose by around 16 percent to around €2.4 billion (previous year: €2.1 billion). The segment's adjusted EBIT is expected to be around €228 million (previous year: €180 million), a jump of around 27 percent, and exceeded the outlook (€190 million to €225 million).

The KION Group anticipates that the global market for industrial trucks will remain fairly flat in 2020 in view of the ongoing geopolitical uncertainties and expected economic volatility. By contrast, demand for supply chain solutions should continue to rise.

The KION Group, in 2020, plans to continue to forge ahead with its KION 2027 growth strategy and invest heavily in the expansion of production capacity worldwide. Additionally, it plans to broaden its range of products and solutions, step up software development for automation solutions and enhance its portfolio of energy systems. The expansion of the global sales and service network is also to be continued, as is the Group's digital transformation.

In 2020, the KION Group's adjusted EBIT and free cash flow will therefore be burdened by the substantial volume of strategic investments aimed at further expanding the business.

This release contains forward-looking statements that are subject to various risks and uncertainties. Future results could differ materially from those described in these forward-looking statements due to certain risk factors and uncertainties, e.g. changes in business, economic and competitive conditions, regulatory reforms, results of technical studies, foreign exchange rate fluctuations, uncertainties in litigation or investigative proceedings, and the availability of financing. We do not undertake any responsibility to update the forward-looking statements in this release.

Order intake comprises all orders received from customers less any cancellations in the underlying period. Adjusted EBIT corresponds to earnings before interest and taxes but excludes the effects of purchase price allocations as well as non-recurring items. The adjusted EBIT margin is calculated as the ratio of adjusted EBIT to revenues. Free cash flow is defined as cash flow from operating activities plus cash flow from investing activities.

Explanations and reconciliations of key financial figures used can be found in the KION Group AG's Annual Report 2018 (available at, especially on the pages 61, 70 et seq., 74 et seqq., 81 et seq., 217, 232, 268 et seq.

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