The forward-looking statements and information given below are based on the Company’s current expectations and assessments. Consequently, they involve a number of risks and uncertainties. Many factors, several of which are beyond the control of the KION Group, affect the Group’s business activities and profitability. Any unexpected developments in the global economy would result in the KION Group’s performance and profits differing significantly from those forecast below. The KION Group does not undertake to update forward-looking statements to reflect subsequently occurring events or circumstances. Furthermore, the KION Group cannot guarantee that future performance and actual profits generated will be consistent with the stated assumptions and estimates and can accept no liability in this regard.
Expected macroeconomic conditions
According to the IMF’s World Economic Outlook in October 2013, global economic growth in 2013 will be slightly below the 2012 level. A growth rate of 2.9 per cent is now forecast for the year as a whole, despite the fact that growth of 3.5 per cent had been anticipated for 2013 at the end of 2012. Economic output in the eurozone is expected to show a fall of 0.4 percentage points. The 2013 growth forecasts for the BRIC countries were also lowered over the course of the year. Nevertheless, growth prospects remain good, especially in China.
The forecast for economic conditions is based on the assumption that monetary and fiscal policy will support the global economy. There are also considerable risks resulting, in particular, from the sovereign debt problems in the eurozone and United States, the tightening of public finances and the possibility of destabilisation in financial markets.
Expected sectoral conditions
The overall market for industrial trucks depends on the economic environment in the sales markets combined with specific regional factors, with the level of capital investment and growth in the volume of world trade being particularly crucial. Fuelled by strong demand in China and the United States, the global market for industrial trucks continued to pick up over the first nine months of 2013, growing by around 5.0 per cent. The KION Group therefore expects to see a slight recovery in demand for 2013 as a whole, compared with 2012.
China, the United States, eastern Europe and Brazil are the sales markets that are expected to drive growth, although China is likely to grow at a slightly slower rate than the medium-term historical trend. Based on developments over the first nine months, demand is predicted to be largely stable in western Europe, predominantly as a result of old trucks being replaced.
Expected business situation and financial performance
Nine months on, the KION Group essentially reaffirms the forecasts made in the group management report. Nevertheless, economic and sectoral conditions remain challenging. Despite negative currency effects and subdued demand in western Europe, the KION Group anticipates that revenue for 2013 as a whole will be at roughly the same level as in the previous year (excluding the hydraulics business). It had expected a moderate increase at the end of 2012. Given the cost-cutting measures implemented, this is not expected to have any significant impact on the financial performance or financial position of the KION Group. Provided there is no significant downturn in the macroeconomic environment in the fourth quarter, the KION Group stands by its forecast for the year, and its objectives of moderate rises in adjusted EBIT and the EBIT margin (both excluding the hydraulics business) remain unchanged.
For the year as a whole, the service business is expected to contribute over 40.0 per cent of revenue, which is slightly more than was forecast at the end of 2012.
The reduction in borrowings should also be reflected in a rise in net income. In departure from the forecast for a small net income at the end of 2012, the KION Group now expects net income to be much higher, partly due to non-recurring items arising from the capitalisation of deferred taxes.
Expected financial position
By using the issue proceeds (net of bank charges) and other cash and drawings under the new revolving credit facility to repay borrowings in July, the KION Group greatly improved its funding structure compared with the end of 2012.