ESRS E5 – Resource use and circular economy

Material topics for the KION Group are managed in the context of the ‘Circularity’ action field.

Material impacts and their interaction with strategy and business model in relation to resource use and circular economy (E5 SBM-3)

The double materiality analysis identified the positive and negative material impacts, risks, and opportunities outlined below in relation to resource use and circular economy in the KION Group.

Depletion of natural resources (negative impact)

The KION Group has identified the depletion of natural resources through the consumption of various raw materials, input materials, and rare earth metals as a material negative impact. In a linear economy, the depletion of natural resources can have long-term consequences for people and the environment, such as the destruction of ecosystems or water scarcity. It can also lead to volatile prices for raw materials and thus adversely affect the economy. The KION Group’s business model is based on the manufacturing of products for which a number of raw materials and components are required, so it is directly reliant on these being available. To mitigate the depletion of natural resources, the KION Group can exert a direct influence through sustainable sourcing (e.g. by purchasing recycled materials).

Use of recycled materials and components (positive impact)

Besides virgin resources, the KION Group also uses raw materials with a recycled content in its production, such as steel and iron, which saves finite natural resources and protects ecosystems. The KION Group thus reduces the potential environmental impact and GHG emissions that the extraction of new raw materials entails. The KION Group believes that the use of recyclates and refurbished components is a growth-relevant element of its business model and increases the security of supply of materials. To achieve this, adjustments must be made to the upstream value chain. The KION Group will support these with suitable procurement strategies.

Non-circular product portfolio (negative impact)

The KION Group has identified its contribution to the linear use of resources – due to a product design that follows a linear lifecycle – to be a material negative impact of its operations. Products in a non-circular product portfolio frequently comprise materials, composites, and components that are difficult to recycle. This means that valuable raw materials are lost from the recycling system, both depleting natural resources and making it more difficult and costly to dispose of these products. In the course of its business activities, the KION Group exerts direct influence on the development and design of its product portfolio, including the composition and properties of its products and solutions. At the same time, the KION Group is dependent on the alternatives available on the market to achieve consistent characteristics for products with recycled materials.

Refurbishing of products (positive impact)

The KION Group can make sure that the design of its products is potentially sustainable by taking criteria such as durability, repairability, and accessibility into account. Using a high proportion of recyclable materials also allows products to be reused or refurbished more easily. In turn, this can have a positive impact on ecosystems and biodiversity because valuable resources are saved and GHG emissions are cut in sourcing and production. Refurbishing trucks and warehouse technology and modernizing the supply chain solutions that have been installed for customers are part of the KION Group’s business model. The industrial trucks in the Industrial Trucks & Services segment over which the KION Group retains beneficial ownership are leased to customers multiple times, refurbished between leases if required, or sold to dealers or customers following refurbishment. In the Supply Chain Solutions segment, equipment is serviced or upgraded, with older technology being replaced by newer and more efficient technology.

Packaging waste (negative impact)

The creation of packaging waste in the course of the KION Group’s business was determined as a material negative impact. The KION Group works with complex products and equipment that are handled in great numbers along the value chain. This means that packaging waste arises in the procurement of goods in the supply chain, during the Company’s own production processes, when setting up equipment and using products and solutions at customers, and when shipping spare parts. Packaging waste that comprises various types of plastic is difficult to recycle. If not disposed of properly, packaging waste is damaging to the environment, especially the oceans and seas. It results in a loss of biodiversity and poses a risk to people, whose bodies absorb microplastics through their food.

Waste from own operations (negative impact)

Waste from the KION Group’s own operations has been identified as a further negative impact. A particular challenge is posed by waste that cannot be recycled. This includes mixed waste from demolition works or hazardous waste from production, for example paint residue, work materials covered in oil, and replaced components. If this waste is not disposed of properly, there is a risk that it will find its way into the environment, contaminate soil and water, and thus endanger the flora and fauna that live there.

Policies related to resource use and circular economy (E5-1)

The following subchapter deals with the KION Group’s material policy related to resource use and circular economy.

The ‘Circularity’ action field under the KION Group’s sustainability strategy is being continually refined, with plans to establish the action field across the Group. One of the targets is to continually increase the volume of recycled waste by 2030. In the past, the focus was on internal communication, network building, and establishment of the action field. A comprehensive circularity strategy including targets, metrics, and an action plan is in the process of being drawn up for both the Industrial Trucks & Services and the Supply Chain Solutions segments (see ‘Strategy targets and target achievement in 2025’).

As a result, there is as yet no central groupwide policy on the sub-topics of resource inflows and resource outflows.

Health, Safety, and Environment Standard

The KION HSE Standard governs management of the ‘Waste’ sub-topic. In addition to environmental protection, it covers a number of other areas, such as health and safety aspects. The ‘Environmental protection’ chapter addresses various issues such as training, risk assessment, audits, waste management, packaging and materials management, waste recycling, climate change mitigation, emissions, and the discharging of liquid chemicals. Further information on application of the HSE Standard is provided in the ‘Policies related to pollution’ chapter.

The HSE Standard sets out the requirement that all local sites must control and minimize waste, emissions, and the use of hazardous substances in accordance with national legislation and ISO 14001 or equivalent certification. The standard also stipulates that the logistics department must design packaging in consultation with the procurement department to minimize waste and the use of materials and to reduce upstream and downstream energy consumption. The HSE Standard requires all Group sites to operate a program for the regular collection and proper disposal of hazardous and non-hazardous waste. Only qualified contractors certified in accordance with national statutory requirements are used for these tasks.

Beyond the material impacts, risks, and opportunities, other aspects – such as transitioning away from the use of virgin resources, relative increases in the use of recycled resources, sustainable sourcing, and the use of renewable resources – are not covered by the HSE Standard or other policies.

Actions and resources related to resource use and circular economy (E5-2)

The following subchapters deal with the KION Group’s material actions related to resource use and circular economy. In this context, the KION Group focuses on refurbishing used industrial trucks, recycling lithium-ion batteries, and improving its waste management. For example, a product-related initiative, namely the Cradle to Cradle certification of the Dematic Multishuttle^® 2 (Bronze), was carried out in 2025. Training on protecting the environment and combating climate change was also launched and initial steps were taken to introduce a waste handbook.

Refurbishment of used industrial trucks

The refurbishing process includes disassembly, replacement of wearing parts, repainting, and reassembly. Used trucks, especially returned leased trucks, are carefully checked at the end of their first lifecycle of around five years and refurbished in a standardized procedure.

In the KION ITS EMEA sales and service organizations, the KION Group operates refurbishing centers at sites in Barcelona (Spain), Lainate (Italy), Stuhr (Germany), Örebro (Sweden), Poznań (Poland), and Çerkezköy (Turkey).

Work on extending and industrializing the existing refurbishing center in Velké Bílovice (Czech Republic) began in April 2024. Operations are scheduled to commence after completion at the end of 2025, with a start-up phase in the first quarter of 2026. Furthermore, the refurbishment of used trucks also continued at the sites in Indaiatuba (Brazil) and Jingjiang (China) as well as at European sites in 2025.

Refurbishment of lithium-ion batteries

KION Battery Systems GmbH (KBS), a subsidiary of KION GROUP AG, has been the central unit responsible for refurbishing the lithium-ion batteries from returned leased trucks since 2023. The refurbishing process includes disassembly, checking and replacement of modules, and a functional test.

A workshop handbook for the refurbishment of lithium-ion batteries (48V/90V) was created for the STILL branches in Germany to enable their workshops to refurbish the batteries themselves in the future, depending on their condition. This planned action of local refurbishment in the workshops is currently undergoing a further review.

Recycling of lithium-ion batteries

In the reporting year, the KION Group continued its strategic partnership with Li-Cycle Holdings Corp., which began in 2023. The cooperation agreement that was signed with the latter on the recycling of lithium-ion batteries facilitates the resource-efficient recovery of a large proportion of the materials in the lithium-ion batteries used by KION ITS EMEA. It means that the critical minerals contained in the old batteries can be used to make new batteries.

A web-based application was developed in 2025 to connect more Group companies to the return process and to simplify it. This solution digitalizes and accelerates the return process while simultaneously providing a basis for comprehensive end-of-life documentation. The process improvements and concerted efforts around internal communication in the network led to a further increase in the volume of recycled materials in 2025, despite a considerable rise having been achieved in 2024.

In mid-October, the opening of a new center of competence for energy at the Hamburg site saw the KION Group bring the first production line for the new lithium-ion batteries on stream. Further production lines are to be added in stages in order to continually increase capacity. At the end of their use phase, the batteries enter a sustainable recycling process run by Li-Cycle.

Circular process optimization

In the Supply Chain Solutions segment, Dematic reached a key milestone in the integration of circular processes in products when the Multishuttle^® 2 system, which is manufactured at the Stříbro site, was recognized as Cradle to Cradle Certified^® (Bronze) in June 2025.

The certification requires lifecycle thinking, a high degree of transparency, and close collaboration in the supply chain. It is closely linked to improvement strategies, which are reviewed every three years as part of routine recertification.

Improvement of waste management

In the reporting year, actions were initiated in the Supply Chain Solutions segment aimed at reducing the volume of waste being generated and increasing the proportion being recycled. The Installation Waste Management Team, which is responsible for avoiding waste, was established in 2024. At regular meetings, potential for reducing the volume of waste that is generated at customer sites is identified and strategies are developed. Guidelines for recycling pallets and managing waste were established and distributed to all KION Group equipment installers working at customer sites. Potential steps include identifying and compiling a list of suitable recycling partners, assessing sites’ waste disposal practices, and, taking this as the starting point, creating strategic waste disposal plans. The KION Group’s overarching aim is to enhance the recycling and waste management capacities of the sites.

In 2024, the Supply Chain Solutions segment developed guidelines for assessing waste management at site level and determining relevant measures. The guidelines are updated on an ongoing basis and complemented by workshops run by the ‘Dematic Sustainability Champions Network (DSCN)’ in order to provide targeted support for the expansion of recycling and waste management capacities at the Dematic sites. Given that conditions at the sites vary due to differing regional requirements or the specific type of waste involved, tailored approaches are essential. The guidelines facilitate the precise assessment of local waste streams and offer concrete recommendations for plans of action and the implementation of a sustainable waste management system.

The Industrial Trucks & Services segment instigated the development of a waste management handbook in 2025, which is due to be completed in 2026. This handbook concentrates on one German site with the aim of gradually rolling it out to other sites. The aim of this action is to heighten employees’ awareness of waste management and to permanently improve the proper handling and separation of waste.

Dematic training on protecting the environment and combating climate change

The Supply Chain Solutions segment extensively revised its training on protecting the environment and combating climate change in 2025. It contains updated information on climate action, energy, and waste recycling. The training is aimed at making Dematic employees familiar with environmental aspects of operations, encouraging sustainable practices in the workplace, and improving the environmental footprint of the business. This training is compulsory for all Dematic employees in HSE and can also be accessed by all employees in the KION Learning Academy. It is available in seven languages to ensure that it has a broad reach within the workforce.

Targets related to resource use and circular economy (E5-3)

The following subchapter deals with the KION Group’s material targets related to resource use and circular economy.

Increase in waste recycling

For the sub-topic of waste, the KION Group has set itself a target of significantly increasing the proportion of waste that it recycles relative to the total volume of waste generated. The target for increasing the proportion of recycled waste from the Group’s own operations has been embedded in its sustainability strategy. This target is directly linked to the guidance in the groupwide HSE Standard, which calls for an effective recycling program for all sites in order to continually improve the recycling rates of the local organizations.

The KION Group’s target for increasing the proportion of recycled waste from its own operation is at least 85 percent by 2030.

In terms of the waste hierarchy, the target relates to the levels ‘preparation for reuse’ and ‘recycling’. The target was set voluntarily and is not the result of a statutory obligation (see ‘Strategy targets and target achievement in 2025’).

It was developed in collaboration with HSE experts in the KION Group who have proven specialist knowledge of waste management. Because it is not currently possible to forecast the volume of waste that will be generated in the future, the target is based on the absolute figures from 2023 and past experience in recent years. The relevant Operating Units define their individual percentage targets using a bottom-up approach. These results are aggregated with the absolute figures to produce a groupwide target. Conversion and construction work on buildings and factories can produce considerable volumes of waste that cannot be recycled. If such measures are planned at the Operating Units’ sites, they are factored into the target setting, even though precise volumes of waste cannot be forecast.

Target achievement is monitored through the consolidated HSE reporting for all sites and is the responsibility of the Operating Units. The annual collection of data enables trends to be analyzed in detail. Based on the data available for 2025, the KION Group is on track to achieve the target set for 2030. The proportion of recycled waste increased to 79.9 percent in 2025 (2024: 77.8 percent).

In terms of material impacts, risks, and opportunities in the sub-topics of resource inflows and resource outflows, there is currently neither a measurable, outcome-oriented target nor a time-bound target that is used as a central key performance indicator. In 2025, emphasis continued to be placed on increasing internal transparency and evaluating different metrics.

Resource inflows and outflows (E5-4; E5-5)

In addition to providing general information about resource inflows and outflows in the KION Group, the following subchapters deal with the KION Group’s material metrics in this regard.

The manufacturing process for the KION Group’s product portfolio uses a variety of materials. These materials are mainly steel and iron and are used to manufacture components such as masts, cabins, counterweights, or parts for storage systems, conveyor systems, and sortation systems. Process materials and semi-manufactured parts are also used in the course of production. They include chemicals, such as paint, powder coatings, and oil and lubricants. Various types of plastic and rubber are used as well as electronics. Batteries for industrial trucks are purchased or produced inhouse. Packaging material, including wood, cardboard, and plastic, is also used for shipping spare parts and delivering system parts to customers.

Durability

Durability and repairability are essential properties that are factored into the product development process for the KION Group’s products. The counterbalance trucks and warehouse trucks that are produced in the Industrial Trucks & Services segment are designed to have a long life. Their construction from predominantly steel and iron helps to ensure that the industrial trucks are robust. They can clock up many hours of operation. The number varies in line with individual customer use and product configuration. A large proportion of the equipment in the Supply Chain Solutions segment is also composed of steel in order to ensure the equipment’s robustness and durability for many years. Their modular construction allows systems to be flexibly adjusted and expanded in order to cater to changing requirements.

With regard to the expected durability of the products manufactured by the KION Group, there continues to be no generally recognized industry average for specific products or for product groups in 2025.

Repairability and refurbishment

Because downtime for systems or industrial trucks can entail considerable costs, the products of the KION Group are designed to give customers maximum possible operational readiness. In the event of a stoppage, technicians must be able to access the point of repair rapidly, so straightforward and safe access is essential. A high degree of repairability and durability are important principles for the KION Group and form the core basis of the service business model.

There is no established rating system for the repairability of products and systems of the KION Group. However, a high level of repairability is an important factor in their sustainability. This is reflected in a number of indicators, such as the long availability of spare parts, customized service agreements, and modular product construction. The speed of accessing the point of repair, the ease of disassembly with standard tools, and the option to install software upgrades and updates help to ensure that repairs can be made rapidly. These measures mean that products and systems can be used for a long time, thereby saving resources.

The longevity and repairability of KION Group products, particularly industrial trucks, allow them to be refurbished at the end of their first customer deployment. This provides the option of reusing them as rental or used trucks.

Recycling

KION Group products offer a high level of recyclability. The counterweights in forklift trucks, for example, can be easily melted down due to their high iron content. Elsewhere, targeted action was taken to optimize recycling processes, particularly for lithium-ion batteries.

Metrics for resource inflows and outflows

The metrics reported and explained below for resource inflows and outflows are based on defined methods and material assumptions but also on estimates that involve outcome uncertainties.

The metric ‘Overall total weight of products and technical and biological materials used (including packaging)’ covers all resource-relevant procurement categories. Net material weight is always used. Starting in 2025, the methodology for determining the weight data for purchased materials was refined in order to ensure more consistent data. As a result of this change, the prior-year figure for the total weight of the products and technical materials used was retroactively adjusted from the original figure of 989,509 tonnes to 917,247 tonnes. This corresponds to a reduction of 72,262 tonnes compared with the total weight reported in the previous year. Due to the inclusion of revenue from the KION Group’s service business under the updated methodology, the weight of reused or recycled secondary components and materials increased from 281,251 tonnes (28.4 percent of the total) to 310,582 tonnes (33.9 percent of the total). This corresponds to an increase of 29,331 tonnes compared with the figure reported in the previous year. Furthermore, the change in methodology resulted in the share of recyclable content in products and their packaging for 2024 growing from 48.5 percent to 54.3 percent, a rise of 5.8 percentage points. The primary data sources for collecting this metric are the product series sold, internally documented lifecycle assessments (LCAs) that reflect the product portfolio, and the revenue of the segments for determining the total weight.

The total weight for the Industrial Trucks & Services segment was extrapolated pro rata to the product classes sold in the last three years using the weight data available from the LCAs (kg per industrial truck) based on an average value.

The total weight for the Supply Chain Solutions segment was determined on the basis of the revenue from specific product categories in the Supply Chain Solutions and Industrial Trucks & Services segments due to a lack of data on order quantities. For the extrapolation for the Group, the spare-parts business and the recyclable materials in the products were also taken into account. Given the limited use of packaging for industrial trucks and supply chain solutions, the share was assessed to be negligible based on internal calculations and cost/benefit aspects.

The biological materials used in the manufacture of KION Group products were deemed not to be relevant, as an analysis of the procurement data concluded that the total amount was below the defined materiality threshold.

There is uncertainty with regard to the estimates used to determine the total weight of the products and materials used because the weight data for the product series from the documented LCAs does not cover the entire product portfolio of industrial trucks and because the data for the Supply Chain Solutions segment is extrapolated.

The calculation of the ‘Weight of secondary reused or recycled components and materials used in production’ and ‘Proportion of recyclable products and their packaging’ metrics are based on the total weight of materials used as well as the detailed information contained in the documented LCAs. Due to the lack of available data from the upstream value chain, there is a degree of measurement uncertainty in the two metrics. Consequently, the recycling atlas of the German Mineral Resources Agency (DERA) at the Federal Institute for Geosciences and Natural Resources (BGR) and data from the Bureau of International Recycling are used as the basis for the average global values for both metrics. In the financial year, following an analysis of the material groups, steel and iron in particular were assessed as essential purchased materials for these metrics. However, the KION Group plans to systematically assess additional material groups in the future and calculate the relevant average values.

For the ‘Proportion of recyclable products and their packaging’ metric, »recyclability was calculated on the basis of global average figures based on the OECD report ‘Global Material Resources Outlook to 2060’, which is also used in the DERA recycling atlas.« A recycling input rate and recyclability of zero are assumed for the materials not covered by the atlas, as no reliable reference data is available.

Metrics for waste generated

The KION Group is a mechanical engineering company, most of whose waste is in the scrap metal materials stream. In 2025, a significant proportion of waste also came from the foundries. Packaging waste such as wood was generated too.