[27] Equity
Subscribed capital and capital reserves
As at 31 December 2018, the Company’s share capital amounted to €118.1 million, which was unchanged on 31 December 2017, and was fully paid up. It was divided into 118.1 million no-par-value shares.
The Annual General Meeting on 11 May 2017 voted to create new authorised capital that will enable the KION Group to continue to meet its funding needs quickly and flexibly. Subject to the consent of the Supervisory Board, the Executive Board is authorised until 10 May 2022 to increase the Company’s share capital by up to €10.879 million by way of an issue of up to 10,879,000 new no-par-value bearer shares (2017 Authorised Capital).
With the consent of the Supervisory Board, the Executive Board of KION GROUP AG decided on 22 May 2017 to utilise some of the authorised capital created by the 2017 Annual General Meeting. The share capital was increased against cash contributions by issuing 9.3 million new no-par-value bearer shares. The gross proceeds from the capital increase came to €602.9 million. An amount of €593.6 million was paid into the capital reserves.
The total number of shares outstanding as at 31 December 2018 was 117,924,442 no-par-value shares (31 December 2017: 117,929,171 no-par-value shares). Between 10 September 2018 and 27 September 2018, a further 66,000 treasury shares (KEEP 2017: 60,000 treasury shares) were repurchased via the stock exchange at an average price of €54.17 (2017: €72.15) in order to provide the shares for employees’ own investments and the free shares under the KEEP 2018 employee share option programme. The total cost was €3.6 million ((2017: €4.3 million). Due to the issue of 22,580 bonus shares under KEEP 2015 (KEEP 2014: 27,363 bonus shares) and 38,691 no-par-value shares (2017: 36,294 no-par-value shares) under KEEP 2018, KION GROUP AG held 165,558 treasury shares at the reporting date (31 December 2017: 160,829). These treasury shares are not dividend-bearing and do not confer any voting rights. Further details on the KEEP employee share option programme can be found in note [45]. In February 2019, a further 13,674 no-par-value shares were issued for participants’ own investments under KEEP 2018.
As at 31 December 2018, KION Group employees held options on a total of 43,655 no-par-value shares (31 December 2017: 50,166 no-par-value shares). The share options granted under the employee share option programme are not dividend-bearing and do not confer any voting rights.
Retained earnings
The changes in retained earnings are shown in the consolidated statement of changes in equity in > TABLE 043. The retained earnings comprise the net income (loss) for the financial year and past contributions to earnings by the consolidated entities, provided they have not been distributed.
The figure for retained earnings in 2017 decreased owing to the effects of the transition to IFRS 9, IFRS 15 and IFRS 16, which are described in note [6].
The distribution of a dividend of €0.99 per share (2017: €0.80 per share) to the shareholders of KION GROUP AG resulted in an outflow of funds of €116.8 million in May 2018 (2017: €86.9 million).
Appropriation of profit
KION GROUP AG’s net profit for 2018 was €236.3 million, of which €94.8 million will be transferred to other revenue reserves. The Executive Board and the Supervisory Board will propose to the Annual General Meeting to be held on 9 May 2019 that an amount of €141.5 million be appropriated from the distributable profit of €141.7 million for the payment of a dividend of €1.20 per dividend-bearing share. It is also proposed that the remaining sum of €0.2 million be carried forward to the next accounting period. This equates to a dividend payout rate of 35 per cent of net income.
Accumulated other comprehensive income (loss)
The breakdown of accumulated other comprehensive income (loss) is shown in > TABLE 043.
The currency translation adjustment contains the exchange differences arising from the financial statements prepared in a foreign currency of foreign subsidiaries, associates and joint ventures.
The gains / losses on the defined benefit obligation are the result of remeasuring defined benefit pension obligations (see also note [28]).
The gains / losses on hedge reserves are the effective portion of the changes in the fair value of hedging instruments in documented hedges. The gains / losses on financial investments relate to the remeasurement of the equity investment in Balyo SA at fair value (FVOCI category under IFRS 9; 2017: AfS category under IAS 39).
The gains / losses from equity-accounted investments contain the share of other comprehensive income (loss) from associates and joint ventures accounted for under the equity method.
Non-controlling interests
Non-controlling interests in companies in the KION Group amounted to €3.3 million (31 December 2017: €4.4 million).