Earnings
EBIT and EBITDA
Earnings before interest and tax (EBIT) amounted to €82.1 million, which was more than in the same period of the previous year (Q1 2014: €77.0 million). Although gross profit was up substantially, there were also increases in selling expenses, administrative expenses and development costs. Non-recurring items resulted in expenses of €4.5 million in the first quarter (Q1 2014: €4.5 million). Adjusted EBIT excluding non-recurring items and KION acquisition items amounted to €93.4 million (Q1 2014: €87.4 million). The adjusted EBIT margin was unchanged year on year at 8.0 per cent. > TABLE 05
|
EBIT |
|
|
05 |
|
in € million |
Q1 2015 |
Q1 2014 |
Change |
|
Net income for the period |
41.9 |
27.8 |
50.6% |
|
Income taxes |
–19.6 |
–18.9 |
–3.5% |
|
Net financial expenses |
–20.6 |
–30.3 |
31.8% |
|
EBIT |
82.1 |
77.0 |
6.6% |
|
+ Non-recurring items |
4.5 |
4.5 |
–1.5% |
|
+ KION acquisition items |
6.8 |
5.9 |
16.0% |
|
Adjusted EBIT |
93.4 |
87.4 |
6.8% |
Earnings before interest, taxes, depreciation and amortisation (EBITDA) reached €177.6 million, compared with €166.5 million in the corresponding quarter of 2014. Adjusted EBITDA rose to €181.4 million (Q1 2014: €171.2 million). This means that the adjusted EBITDA margin was virtually unchanged at 15.6 per cent (Q1 2014: 15.7 per cent). > TABLE 06
|
EBITDA |
|
|
06 |
|
in € million |
Q1 2015 |
Q1 2014 |
Change |
|
EBIT |
82.1 |
77.0 |
6.6% |
|
Amortisation and depreciation |
95.5 |
89.5 |
6.7% |
|
EBITDA |
177.6 |
166.5 |
6.6% |
|
+ Non-recurring items |
3.8 |
4.7 |
–19.3% |
|
+ KION acquisition items |
0.0 |
0.0 |
– |
|
Adjusted EBITDA |
181.4 |
171.2 |
5.9% |
Key influencing factors for earnings
The cost of sales increased by 6.1 per cent to €823.5 million (Q1 2014: €776.5 million), slightly below the rate of growth in revenue.
A fall in commodity prices and an improvement in the product mix had a positive impact on the gross margin. Gross profit totalled €341.3 million (Q1 2014: €312.5 million).
Selling expenses grew by 6.7 per cent to €148.5 million (Q1 2014: €139.2 million). Development costs amounted to €34.0 million, a year-on-year increase of €4.6 million (Q1 2014: €29.5 million). Administrative expenses were significantly higher in the first quarter of 2015 at €84.3 million (Q1 2014: €74.4 million), due in large part to costs incurred in connection with the implementation of the Strategy 2020. Currency effects and increased personnel expenses contributed to the rise in functional costs. The ‘Other’ item was at roughly the same level as in the prior-year period at €7.7 million (Q1 2014: €7.6 million). The share of profit (loss) from equity-accounted investments, which are included in the ‘Other’ item, amounted to a loss of €1.6 million (Q1 2014: loss of €1.6 million). The main reason for this was the pro-rata loss from Linde Hydraulics, which was the result of current depreciation and amortisation in connection with its purchase price allocation (PPA), among other factors. > TABLE 07
|
(Condensed) income statement |
07 |
||
|
in € million |
Q1 2015 |
Q1 2014 |
Change |
|
Revenue |
1,164.8 |
1,088.9 |
7.0% |
|
Cost of sales |
–823.5 |
–776.5 |
–6.1% |
|
Gross profit |
341.3 |
312.5 |
9.2% |
|
Selling expenses |
–148.5 |
–139.2 |
–6.7% |
|
Research and development costs |
–34.0 |
–29.5 |
–15.5% |
|
Administrative expenses |
–84.3 |
–74.4 |
–13.3% |
|
Other |
7.7 |
7.6 |
1.2% |
|
Earnings before interest and taxes (EBIT) |
82.1 |
77.0 |
6.6% |
|
Net financial expenses |
–20.6 |
–30.3 |
31.8% |
|
Earnings before taxes |
61.4 |
46.7 |
31.5% |
|
Income taxes |
–19.6 |
–18.9 |
–3.5% |
|
Net income for the period |
41.9 |
27.8 |
50.6% |
Net financial income/expenses
There was a substantial improvement in the balance of financial income and financial expenses, leading to net financial expenses of €20.6 million (Q1 2014: €30.3 million). This encouraging decrease, which also helped to push up earnings before tax, was the result of the optimisation of funding following the early redemption of two tranches of the corporate bonds in the second quarter of 2014.
Income taxes
Income tax expenses amounted to €19.6 million (Q1 2014: €18.9 million). Current income taxes went up by €8.4 million to €22.6 million as a result of the improved earnings situation. However, whereas there had been a deferred tax expense of €4.7 million in the first quarter of 2014, primarily due to utilisation of deferred tax assets, there was deferred tax income of €3.0 million in the reporting period. The tax rate was 31.9 per cent (Q1 2014: 40.5 per cent).
Net income for the period
The KION Group’s net income after taxes totalled €41.9 million, which was up by a substantial 50.6 per cent on the €27.8 million reported in the first quarter of the previous year. Diluted and basic earnings per share for the reporting period increased to €0.41(Q1 2014: €0.28).