Earnings

Earnings before interest and tax (EBIT) amounted to €77.0 million, which was 10.9 per cent below the same period of the previous year (Q1 2013: €86.4 million). Non-recurring items had resulted in income of €1.3 million in the prior-year period, whereas they led to expenses of €4.5 million in the first quarter of this year. As had been the case in the first three months of 2013, these one-off expenses included losses related to the purchase price allocation for the equity-accounted Linde Hydraulics. It should be noted that the figure for the first quarter of 2013 had also included additional non-recurring income of €8.1 million relating to the hydraulics business, which was sold in December 2012. Depreciation, amortisation and impairment losses in connection with the KION acquisition in 2006 went down by €1.8 million to €5.9 million in the first quarter of 2014. Adjusted EBIT, which excludes non-recurring items and KION acquisition items, totalled €87.4 million (Q1 2013: €92.8 million). This decline of 5.8 per cent is largely due to the fact that the figure for the first quarter of 2013 had included positive exchange differences of €3.5 million, whereas these were insignificant in the period under review. The adjusted EBIT margin decreased from 8.5 per cent to 8.0 per cent in the first three months of 2014. >> TABLE 05

EBITDA was down slightly year on year, declining by 1.5 per cent to €166.5 million (Q1 2013: €169.0 million). By contrast, there was a moderate rise in adjusted EBITDA, which climbed to €171.2 million (Q1 2013: €167.9 million). This equates to an adjusted EBITDA margin of 15.7 per cent (Q1 2013: 15.5 per cent). >> TABLE 06

Unlike revenue, the cost of sales was down by 0.8 per cent on the first three months of 2013 at €776.5 million (Q1 2013: €783.1 million). The growth in revenue from new trucks tailored to specific customer requirements had a positive impact on the gross margin, as did the higher proportion of total revenue accounted for by the service business. Gross profit advanced by 3.4 per cent to €312.5 million.

At €139.2 million, selling expenses were almost at the same level as in the first three months of 2013. Administrative expenses were slightly higher year on year at €74.4 million (Q1 2013: €72.7 million) owing to changes to collective bargaining agreements, among other things.

The reasons for the sharp decline in the ‘Other’ item, which dropped by €16.8 million to €7.6 million, included positive exchange differences in the prior-year period and the non-recurring item resulting from the sale of the hydraulics business in the prior-year period. The loss from equity-accounted investments amounted to €1.6 million (Q1 2013: loss of €1.3 million) and is included in the ‘Other’ item. The main reason for this was the pro-rata loss from Linde Hydraulics, which was the result of current depreciation, amortisation and impairment losses in connection with its purchase price allocation (PPA), among other factors. >> TABLE 07

There was a significant improvement in the balance of financial income and financial expenses, leading to net financial expenses of €30.3 million (Q1 2013: €47.6 million). The main reason for this was the decline in interest expenses arising from loan liabilities following repayment in full of the acquisition finance and repayment of the floating-rate portion of the 2011/2018 corporate bond (floating rate note, €175.0 million). On a long-term basis, this more than offset the higher interest expenses arising from the capital market liabilities that resulted from issuing the second bond in February 2013 with a higher fixed interest rate than the floating-rate bank liabilities that it replaced. Net financial income from exchange differences reduced by €3.8 million to €0.3 million following repayment in full of the foreign-currency loan denominated in US dollars and the termination of corresponding hedging instruments in the previous year.


Income taxes amounted to €18.9 million compared with €10.3 million in the first three months of 2013. One of the main reasons for the increase was the higher level of earnings before tax. The deferred tax expense of €4.7 million (Q1 2013: deferred tax income of €8.5 million) was predominantly the result of utilising deferred tax assets relating to loss carryforwards of the German tax group.