Overall assessment of the economic situation

2018 was another successful year for the KION Group. The targets set for its monetary KPIs for 2018 were achieved both at Group level and in the two segments, despite a negative overall currency effect over the course of the year. It should be emphasised that the brief dip in EBIT and free cash flow in the first half of the year was largely reversed again as a result of the faster revenue growth in the second half of the year. The corrective measures taken in the Industrial Trucks & Services segment had the desired effect on the temporary bottlenecks at individual suppliers. The Supply Chain Solutions segment’s strong finish to 2018 more than made up for the shortfalls in project revenue recognised in the first few months of the year. The KION Group was thus able to take full advantage of the generally favourable market conditions in both segments.

The KION Group’s total order intake rose by 8.5 per cent to €8,656.7 million (2017: €7,979.1 million). The contribution from the Supply Chain Solutions segment, where order intake increased by 15.5 per cent, was exceptionally strong, but the Industrial Trucks & Services segment also saw year-on-year order growth of 6.0 per cent. Consolidated revenue improved by 5.2 per cent to €7,995.7 million (2017: €7,598.1 million). The Industrial Trucks & Services segments played a particularly strong part in this revenue growth, whereas revenue in the Supply Chain Solutions segment was only slightly higher than in 2017 due to the overall poor start to 2018.

The KION Group’s EBIT adjusted for non-recurring items and purchase price allocation effects came to €789.9 million (2017: €777.3 million). This year-on-year increase of €12.6 million was achieved despite higher material prices, wage cost rises, negative currency effects and temporary bottlenecks at individual suppliers in the Industrial Trucks & Services segment. There was a moderate reduction in the adjusted EBIT margin to 9.9 per cent (2017: 10.2 per cent). After taking into account diminishing purchase price allocation (PPA) effects and non-recurring items, EBIT rose sharply to €642.8 million (2017: €561.0 million). As a result of higher tax expenses, there was a moderate decrease in net income to €401.6 million (2017: €422.5 million). Non-recurring items in both 2018 (positive item of €29.4 million) and 2017 (positive item of €92.2 million) had a positive impact on tax expenses and thus on net income. Basic earnings per share attributable to the shareholders of the KION Group came to €3.39 in 2018 (2017: €3.68) based on a weighted average of 117.9 million no-par-value shares outstanding during the reporting year (2017: 114.3 million). KION GROUP AG will propose a dividend of €1.20 per share to the Annual General Meeting (2017: €0.99 per share).

Free cash flow increased to €519.9 million (2017: €474.3 million), above all thanks to improved earnings and the lower growth in net working capital.