KION shares

Significant rally in the equity markets despite concerns about the economy

Although the global economy was experiencing a period of weakness and tensions surrounding trade and other geopolitical issues remained high, equity markets worldwide staged a marked recovery over the course of 2019, with some reaching record highs. This was influenced by improved expectations, which had previously assumed a significant economic slowdown in places, or even a recession. Moreover, various risk factors diminished noticeably, including the threat of a hard Brexit, destabilisation of the euro due to a lack of budgetary discipline and interest-rate hikes in the US. Widespread falls in company profits had already been largely priced in and had triggered a major downturn in the stock markets in 2018. Consequently, an upward trend emerged in 2019. The interest-rate environment provided a tailwind as, apart from equities and products based on them, few investments with good returns were available. Over the year as a whole, the DAX added 25.5 per cent while the MDAX gained 31.2 per cent.

Sharp rises in the KION share price

Over the course of 2019, KION shares recouped most of the losses that they had suffered in the previous year. The first four months of trading were characterised by a strong uptrend. The shares then lost momentum on the back of a contracting industrial truck market and fresh concerns about restrictions on global trade. After reaching their low for the year in August, the share price returned to a positive course that continued until the end of the year. The shares ended 2019 at €61.56, which was an increase of 38.9 per cent compared with the close of 2018. At the end of 2019, market capitalisation stood at €7.3 billion, of which €4.0 billion was attributable to shares in free float. The average daily Xetra trading volume in 2019 was 283.4 thousand shares or €14.8 million (2018: 295.7 thousand shares or €18.7 million). > DIAGRAM 001

Further increase planned after record dividend in 2019

The Annual General Meeting on 9 May 2019, at which 87.4 per cent of the voting share capital was represented, adopted the resolution on the appropriation of profit for 2018 with an overwhelming majority. The payment of €1.20 per dividend-bearing share was 21.2 per cent higher than in the prior year. The total dividend payout rose from approximately €116.8 million to €141.5 million, which equates to a dividend payout rate of around 35 per cent.

The Executive Board and Supervisory Board of KION GROUP AG will propose a dividend of €1.30 per share (2018: €1.20) to the Annual General Meeting on 12 May 2020. This equates to a total dividend payout of €153.4 million and thus a rise of 8.4 per cent compared with the prior year. With earnings per share for 2019 of €3.86, this equates to a dividend payout rate of around 34 per cent. > TABLE 001

Stable shareholder structure

The shareholder structure remained almost unchanged in the reporting year. Weichai Power Co., Ltd., Weifang, People’s Republic of China, KION GROUP AG’s anchor shareholder, has retained its 45.0 per cent stake and thus is still the largest single shareholder, while KION GROUP AG continues to hold 0.1 per cent of the shares. The free float therefore accounted for 54.9 per cent at the end of 2019.

Between 9 and 20 September 2019, KION GROUP AG repurchased a total of 60,000 shares (around 0.05 per cent of the share capital) for use in the KION Employee Equity Programme (KEEP). By 31 December 2019, a total of 67,104 shares had been purchased by staff (2018: 38,691 shares). The number of shares held in treasury stood at 130,644 as at the reporting date. > DIAGRAM 002

KION shares mainly recommended as a buy

As at 31 December 2019, 22 brokerage houses were following and reporting on the KION Group (2018: 21). Of this total, ten analysts recommended KION shares as a buy, eight rated them as neutral and four advised selling them. The median target price specified by the share analysts was €62.50 (31 December 2018: €64.00). > TABLE 002

Share data

Stable credit ratings

The KION Group continues to have an investment-grade credit rating. In October 2019, Fitch Ratings confirmed the Group’s long-term issuer rating of BBB– with a stable outlook. Standard & Poor’s has classified the KION Group as BB+ with a stable outlook since December 2019.