Related party disclosures
In addition to the subsidiaries included in these condensed consolidated interim financial statements, the KION Group maintains direct or indirect relationships with a large number of unconsolidated subsidiaries, joint ventures and associates in the course of its ordinary business activities. According to IAS 24, related parties include entities that have control or significant influence over KION GROUP AG. An entity is usually assumed to have control (parent) if it holds more than 50 per cent of the shares in another entity. Significant influence generally exists if an entity holds between 20 per cent and 50 per cent of the shares in another entity.
The related parties that are solely or jointly controlled by the KION Group or over which significant influence can be exercised are included in the list of shareholdings as at 31 December 2013. In addition, Weichai Power Co. Ltd., Weifang, China, which indirectly holds 33.3 per cent of the shares in KION GROUP AG and is also the largest single shareholder, Superlift Holding S.a r.l., Luxembourg, which holds 26.9 per cent of the shares in KION GROUP AG, Kohlberg Kravis Roberts & Co L.P., New York, USA, and Goldman, Sachs & Co., New York, USA, are also related parties.
Weichai Power
In the first nine months of 2014, the revenue from transactions with Weichai Power Co. Ltd., Weifang, China and its subsidiaries (referred to below as Weichai Power), which resulted from the sale of goods and a plot of land, amounted to €3.8 million, most of which was generated in the second quarter.
In addition, Weichai Power indirectly has a controlling interest (70.0 per cent) in Linde Hydraulics GmbH & Co. KG, Aschaffenburg (referred to below as Linde Hydraulics). The remaining shares (30.0 per cent) in Linde Hydraulics are held by the KION Group. During the first nine months of 2014, the KION Group earned revenue of €15.1 million from selling goods and services to Linde Hydraulics and its subsidiaries (Q1 – Q3 2013: €12.3 million). Of this amount, €4.9 million relates to the third quarter of 2014 (Q3 2013: €4.2 million). Over the same period, companies in the KION Group obtained goods and services from Linde Hydraulics and its subsidiaries amounting to €83.2 million (Q1 – Q3 2013: €88.5 million). Of this amount, €28.6 million relates to the third quarter of 2014 (Q3 2013: €25.7 million). The receivables arising from the sale of goods and services stood at €2.7 million as at 30 September 2014 (31 December 2013: €6.0 million). No valuation allowances for trade receivables had been recognised as at the reporting date, a situation that was unchanged on 31 December 2013. As at 30 September 2014, liabilities to Linde Hydraulics and its subsidiaries resulting from the purchase of goods and services came to €4.8 million (31 December 2013: €2.7 million).
Superlift Holding
KION GROUP AG, KKR and Goldman, Sachs & Co. concluded a new global advisory agreement on 7 June 2013, which stipulates a fixed annual fee of €125,000 each. Under the agreement, KKR and Goldman, Sachs & Co. will continue to provide limited advisory services for the KION Group after its IPO in the event that the KION Group decides it wishes to draw on this expertise. In the first to third quarter of 2014, a total of €0.2 million was recognised as an expense. Of this amount, €0.1 million relates to the third quarter of 2014. A pro-rata amount of €2.4 million (Q3 2013: €0.1 million) had been recognised as an expense in the first nine months of 2013, mainly under the old advisory agreement.