Business situation and financial performance of the KION Group
Level of orders
The total value of the KION Group’s order intake fell by 4.9 percent to €10,320.9 million in 2024 (2023: €10,849.9 million).
The Industrial Trucks & Services segment recorded a small decrease in the value of its order intake of 1.6 percent. This was due to the shift in the product mix and country mix within new business, although the impact of this was mitigated to some extent by encouraging growth in orders in the service business. The segment saw a slight rise of 1.3 percent in the number of new trucks ordered worldwide compared with the previous year.
The decrease in order intake in the Supply Chain Solutions segment was much more pronounced at 14.2 percent. The persistently weak level of orders in the project business (business solutions) was not offset by order intake in the service business, which was more or less unchanged year on year.
The KION Group’s order book amounted to €4,635.1 million at the end of the year (December 31, 2023: €6,045.2 million*).
Revenue
At €11,503.2 million, consolidated revenue was up marginally by 0.6 percent in 2024 (2023: €11,433.7 million).
The moderate 1.5 percent increase in revenue generated from external customers in the Industrial Trucks & Services segment to €8,593.5 million (2023: €8,464.2 million) was predominantly due to the growth of the service business, whereas new business increased only marginally year on year. Overall, unit sales were on a par with the prior-year level, with the rise in warehouse truck sales matched by the decrease in counterbalance truck sales.
In the Supply Chain Solutions segment, revenue generated from external customers edged down by 2.1 percent to €2,906.2 million (2023: €2,968.4 million). Although revenue fell in the project business (business solutions) owing to muted order intake in recent quarters, the decrease was largely offset by the rapidly growing service business.
The proportion of consolidated revenue attributable to the service business advanced to 46.1 percent (2023: 44.0 percent). This was because, while service revenue increased, new business registered only a modest rise and project business registered a decline in revenue in the two operating segments respectively.
in € million |
2024 |
2023 |
Change |
|---|---|---|---|
Industrial Trucks & Services |
8,593.5 |
8,464.2 |
1.5% |
New business |
4,484.4 |
4,465.2 |
0.4% |
Service business |
4,109.1 |
3,999.0 |
2.8% |
– Aftersales |
2,158.7 |
2,089.7 |
3.3% |
– Rental business |
1,190.3 |
1,163.6 |
2.3% |
– Used trucks |
468.0 |
460.8 |
1.6% |
– Other |
292.1 |
284.9 |
2.5% |
Supply Chain Solutions |
2,906.2 |
2,968.4 |
–2.1% |
Business solutions |
1,715.4 |
1,930.9 |
–11.2% |
Service business |
1,190.8 |
1,037.4 |
14.8% |
Corporate Services |
3.5 |
1.1 |
> 100.0% |
|
|
|
|
Total revenue |
11,503.2 |
11,433.7 |
0.6% |
Revenue by sales region
In the Industrial Trucks & Services segment, the biggest contribution to the growth in revenue generated from external customers came from the main sales region, EMEA. Revenue also rose in the APAC region, whereas revenue in the Americas region fell sharply year on year.
In the Supply Chain Solutions segment, revenue generated from external customers was on a par with the previous year in both the core North America market and the APAC region. In the EMEA region, however, the decrease in the level of orders led to a significant drop in revenue.
in € million |
2024 |
2023 |
Change |
|---|---|---|---|
EMEA |
7,750.2 |
7,622.1 |
1.7% |
Western Europe |
6,811.5 |
6,651.3 |
2.4% |
Eastern Europe |
805.1 |
846.2 |
–4.9% |
Middle East and Africa |
133.7 |
124.6 |
7.3% |
Americas |
2,501.2 |
2,582.5 |
–3.2% |
North America |
2,196.1 |
2,250.8 |
–2.4% |
Central and South America |
305.1 |
331.8 |
–8.0% |
APAC |
1,251.8 |
1,229.1 |
1.9% |
China |
685.5 |
714.3 |
–4.0% |
APAC excluding China |
566.3 |
514.8 |
10.0% |
Total revenue |
11,503.2 |
11,433.7 |
0.6% |
Earnings and profitability
EBIT, EBITDA, and ROCE
Earnings before interest and tax (EBIT) improved by a substantial €117.2 million to €777.8 million in 2024 (2023: €660.6 million). The main driver of the year-on-year increase in operating profit was the improvement in gross profit in both operating segments.
EBIT included purchase price allocation effects amounting to an expense of €111.5 million (2023: expense of €92.7 million). This increase resulted mainly from the impairment of goodwill that was carried out in an amount of €22.4 million in the KION ITS Americas Operating Unit (Industrial Trucks & Services segment) in the second quarter of 2024. There were also non-recurring items amounting to a total expense of €27.9 million in 2024 (2023: expense of €37.2 million). Within this figure, there were costs (including interest and consultancy costs) of €14.8 million that were incurred in connection with the ending of a long-running legal dispute related to the acquisition of a group of companies in 2015 by the former Dematic Group. In 2023, the non-recurring items had predominantly comprised expenses for the adjustment of staffing capacity in the Supply Chain Solutions segment. Some of the provisions had been overfunded and were reversed again in 2024.
EBIT adjusted for non-recurring items and purchase price allocation effects (adjusted EBIT) rose sharply to €917.2 million (2023: €790.5 million). The Group’s adjusted EBIT margin improved to 8.0 percent as a result (2023: 6.9 percent).
A reconciliation of adjusted EBIT and adjusted EBITDA, broken down by functional costs, is provided in the tables ‘EBIT’ and ‘EBITDA’. In both tables, the ‘other’ item mainly comprises the share of profit from equity-accounted investments, along with other income and expenses in the income statement.
in € million |
2024 |
in % of revenue |
2023 |
in % of revenue |
|---|---|---|---|---|
EBIT |
777.8 |
6.8% |
660.6 |
5.8% |
Adjustment by functional costs: |
|
|
|
|
+ Cost of sales |
30.0 |
0.3% |
60.9 |
0.5% |
+ Selling expenses and administrative expenses |
60.1 |
0.5% |
59.4 |
0.5% |
+ Research and development costs |
0.3 |
0.0% |
0.2 |
0.0% |
+ Other costs |
49.0 |
0.4% |
9.4 |
0.1% |
Adjusted EBIT |
917.2 |
8.0% |
790.5 |
6.9% |
adjusted for non-recurring items |
27.9 |
0.2% |
37.2 |
0.3% |
adjusted for PPA items |
111.5 |
1.0% |
92.7 |
0.8% |
Earnings before interest, tax, depreciation, and amortization (EBITDA) increased to €1,917.0 million in 2024 (2023: €1,713.6 million). Adjusted EBITDA rose to €1,945.0 million (2023: €1,748.7 million), giving an adjusted EBITDA margin of 16.9 percent (2023: 15.3 percent). The non-recurring items included in EBITDA and EBIT were at a comparable level in the reporting period and were essentially attributable to the same matters.
in € million |
2024 |
in % of revenue |
2023 |
in % of revenue |
|---|---|---|---|---|
EBITDA |
1,917.0 |
16.7% |
1,713.6 |
15.0% |
Adjustment by functional costs: |
|
|
|
|
+ Cost of sales |
–9.3 |
–0.1% |
23.0 |
0.2% |
+ Selling expenses and administrative expenses |
10.1 |
0.1% |
10.1 |
0.1% |
+ Research and development costs |
0.1 |
0.0% |
0.2 |
0.0% |
+ Other costs |
27.1 |
0.2% |
1.9 |
0.0% |
Adjusted EBITDA |
1,945.0 |
16.9% |
1,748.7 |
15.3% |
adjusted for non-recurring items |
28.0 |
0.2% |
32.6 |
0.3% |
adjusted for PPA items |
0.0 |
0.0% |
2.5 |
0.0% |
Return on capital employed (ROCE), which is the ratio of adjusted EBIT to capital employed, increased from 7.7 percent at the end of 2023 to 8.7 percent. This can be explained by the disproportionately strong increase in earnings and a rise in capital employed that was fairly moderate compared with the previous year. The following table ‘Return on capital employed (ROCE)’ shows how the figure for capital employed is calculated.
in € million |
2024 |
2023 |
||||
|---|---|---|---|---|---|---|
Total assets |
18,805.4 |
17,388.4 |
||||
– less selected assets1 |
–4,142.6 |
–3,142.2 |
||||
– less selected liabilities2 |
–4,110.8 |
–4,028.3 |
||||
Capital employed |
10,552.0 |
10,217.8 |
||||
|
|
|
||||
Adjusted EBIT |
917.2 |
790.5 |
||||
|
|
|
||||
ROCE |
8.7% |
7.7% |
||||
|
||||||
Key influencing factors for earnings
The Group’s profitability received a boost not only from robust revenue growth in the high-margin service business of the two segments, but also from the positive effect of being able to push through higher prices for new business in the Industrial Trucks & Services segment and from the slight overall reduction in the cost of materials. Moreover, the Supply Chain Solutions segment achieved savings as a result of adjusting staffing capacity. It also made progress on working through lower-margin legacy projects.
With revenue holding more or less steady, the cost of sales fell by 2.8 percent to €8,409.7 million in 2024 (2023: €8,652.5 million). As a result, the gross margin improved markedly to 26.9 percent (2023: 24.3 percent).
The rise in other functional costs was stronger overall than the rate of revenue growth. Selling and administrative expenses went up by €137.2 million year on year to €2,041.4 million (2023: €1,904.3 million), with selling expenses rising by 5.5 percent and administrative expenses by 9.7 percent. This increase was due, in particular, to a rise in personnel expenses (including for variable remuneration components) and to costs in connection with the strategic, groupwide Business Transformation project.
Research and development (R&D) costs went up by 10.4 percent because of the efforts to drive forward particular areas of development anchored within the strategy. Total spending on R&D – i.e. R&D costs plus capitalized development costs – swelled by 11.9 percent to €392.8 million (2023: €351.0 million). This equates to 3.4 percent of revenue (2023: 3.1 percent).
in € million |
2024 |
2023 |
Change |
|---|---|---|---|
Research and development costs (P&L) |
259.6 |
235.1 |
10.4% |
Capitalized development costs |
133.2 |
116.0 |
14.9% |
Total R&D spending |
392.8 |
351.0 |
11.9% |
R&D spending as percentage of revenue |
3.4% |
3.1% |
– |
The change in the cost of sales and in other functional costs is shown in the table ‘Condensed consolidated income statement’.
in € million |
2024 |
2023 |
Change |
|---|---|---|---|
Revenue |
11,503.2 |
11,433.7 |
0.6% |
Cost of sales |
–8,409.7 |
–8,652.5 |
2.8% |
Gross profit |
3,093.5 |
2,781.2 |
11.2% |
Selling expenses and administrative expenses |
–2,041.4 |
–1,904.3 |
–7.2% |
Research and development costs |
–259.6 |
–235.1 |
–10.4% |
Other |
–14.7 |
18.7 |
< –100% |
Earnings before interest and tax (EBIT) |
777.8 |
660.6 |
17.7% |
Net financial expenses |
–188.0 |
–200.8 |
6.4% |
Earnings before tax |
589.8 |
459.8 |
28.3% |
Income taxes |
–220.5 |
–145.4 |
–51.7% |
Net income |
369.2 |
314.4 |
17.5% |
The ‘other’ item shown in the table came to an expense of €14.7 million (2023: income of €18.7 million). This item comprises the share of profit (loss) of equity-accounted investments, which amounted to income of €15.4 million (2023: income of €12.8 million), and other income and expenses in the income statement. The balance of the latter deteriorated markedly compared with the previous year, partly due to the impairment of the goodwill of the KION ITS Americas Operating Unit, which was carried out in an amount of €22.4 million in the second quarter of 2024, and to non-recurring expenses of €14.8 million resulting from the ending of a legal dispute.
Net financial expenses
Net financial expenses, representing the balance of financial income and financial expenses, amounted to €188.0 million in the reporting year (2023: €200.8 million). Because net financial debt was lower on average, the interest expense on financial debt fell from €67.8 million in 2023 to €61.3 million. By contrast, the increase in the financing volume meant that net interest income/expense from the lease and short-term rental business deteriorated significantly to a net expense of €86.4 million (2023: net expense of €60.9 million). Net interest income of €41.3 million was realized on interest-rate derivatives used for hedging purposes in the lease business (2023: net interest income of €39.9 million). In addition, changes in the fair values of interest-rate derivatives and adjustments to the valuation of lease receivables designated as part of a fair value hedge made a negative contribution of €9.9 million to net financial expenses (2023: negative contribution of €24.7 million). Income and expense resulting from currency translation amounted to a net expense of €12.7 million (2023: net expense of €29.8 million).
Income taxes
Income tax expenses surged to €220.5 million (2023: €145.4 million) on the back of the increase in earnings. The Group’s effective tax rate rose to 37.4 percent (2023: 31.6 percent). The main influences on this tax rate in the reporting year were non-tax-deductible expenses, such as the impairment of the goodwill of the KION ITS Americas Operating Unit, and losses for which no deferred tax assets were recognized.
Net income and appropriation of profit
Net income rose year on year to €369.2 million (2023: €314.4 million) and included net income attributable to non-controlling interests of €8.9 million (2023: €8.6 million). The net income attributable to the shareholders of KION GROUP AG was €360.3 million (2023: €305.8 million). Basic earnings per share attributable to the shareholders of KION GROUP AG came to €2.75 (2023: €2.33) based on 131.1 million (2023: 131.1 million) no-par-value shares. Diluted earnings per share also amounted to €2.75 (2023: €2.33) based on a weighted average number of shares of 131.1 million (2023: 131.1 million).
The distributable profit of KION GROUP AG for the 2024 financial year came to €223.7 million (2023: €189.1 million). The Executive Board and the Supervisory Board will propose to the Annual General Meeting in 2025 that an amount of €107.5 million be appropriated for the payment of a dividend of €0.82 per dividend-bearing share. This equates to a proposed dividend payout rate of around 30 percent of the net income attributable to the shareholders of KION GROUP AG.
* The figure for the Group’s order book as at the end of 2023 was retrospectively reduced by €316.9 million due to a definition-related adjustment in the service business of the Supply Chain Solutions segment.