KION shares

Equity markets largely defy the coronavirus pandemic

The effects of the coronavirus pandemic on economic growth and on companies’ financial position and financial performance significantly influenced the equity markets in the first half of 2020. The measures required to contain the virus – initially in China and subsequently worldwide – and the great uncertainty about how the pandemic would unfold caused the DAX to slump by around 40 percent in the first quarter. However, monetary policy measures implemented by central banks and comprehensive economic support packages put in place by national governments helped to soften the economic impact. Despite the emergence of a second wave of cases at the end of the third quarter, growing confidence that the pandemic could be controlled and steady progress in the development of COVID-19 vaccines in the fourth quarter led to a rally at the end of the year. Over the year as a whole, the DAX added 3.5 percent while the MDAX gained 8.8 percent.

KION shares outperform their benchmark indices

KION shares again comfortably outperformed their benchmark indices. After sliding to their low for the year of €32.97 in March, the shares subsequently recouped a large part of their losses in the first half of 2020. The share price continued to rise in the third quarter, supported by solid financial results from the Supply Chain Solutions segment. The shares briefly lost momentum as a result of the rights issue in late November / early December before rising again. They ended 2020 at €71.16, which was 16.4 percent higher than at the end of the previous year. Based on around 131.2 million shares (December 31, 2019: around 118.1 million shares), this equates to market capitalization of €9.3 billion, of which €5.1 billion was attributable to shares in free float.

Share price performance 2020 compared with the DAX and MDAX

Successful virtual Annual General Meeting

KION GROUP AG’s Annual General Meeting on July 16, 2020 took place virtually for the first time, without shareholders being physically present, due to the restrictions imposed as a result of the coronavirus pandemic. Around 100.4 million of the approximately 118.1 million voting shares were represented, equating to around 85 percent of the share capital. The shareholders voted in favor of the motions, in each case by a large majority. In light of the unpredictability of the pandemic’s likely impact, the Executive Board and Supervisory Board of KION GROUP AG had decided to lower the proposal for the appropriation of profit from €1.30 per share, as published in the 2019 annual report, to €0.04 per dividend-bearing share. The total dividend payout therefore amounted to approximately €4.7 million, enabling €148.8 million to be transferred to retained earnings.

The 2021 Annual General Meeting is scheduled to take place on May 11. The Executive Board and Supervisory Board of KION GROUP AG will propose a dividend of €0.41 per share (2019: €0.04) to the Annual General Meeting. This gives a total dividend payout of €53.7 million. The dividend payout rate accordingly amounts to around 25 percent with earnings per share for 2020 of €1.81.

Successful capital increase – shareholder structure remains stable

With the consent of the Supervisory Board, the Executive Board of KION GROUP AG decided on November 18, 2020 to increase the Group’s share capital by way of a rights issue against cash contributions, using a large part of the authorized capital. The aim was to strengthen the KION Group’s financial position and prepare it for accelerated profitable growth after the coronavirus pandemic. The subscription offer was successfully completed on December 4, 2020: 12,557,440 new shares were subscribed to and thus 95.8 percent of pre-emption rights were exercised. The remaining 551,207 shares were sold to eligible institutional investors as part of a private placement in an accelerated bookbuilding process in accordance with the applicable securities legislation. The capital increase generated gross issue proceeds totaling around €813 million.

KION GROUP AG’s anchor shareholder, Weichai Power Co., Ltd., Weifang, People’s Republic of China, had contractually agreed before the capital increase to exercise all of its pre-emption rights and to acquire around 5.9 million new shares. The shareholder structure therefore remained almost unchanged in the reporting year. As at December 31, 2020, Weichai Power held 45.2 percent of the shares, while KION GROUP AG continued to hold 0.1 percent. A total of 18,467 shares (2019: 67,104 shares) were acquired by staff under the KION Employee Equity Program (KEEP). Consequently, the number of shares held in treasury stood at 112,177 as at the reporting date (December 31, 2019: 130,644). The free float therefore accounted for 54.7 percent at the end of 2020.

Shareholder structure as at December 31, 2020

KION shares mainly recommended as a buy

As at December 31, 2020, 20 brokerage houses were following and reporting on the KION Group (December 31, 2019: 22). Of this total, twelve analysts recommended KION shares as a buy, six rated them as neutral, and two advised selling them. The median target price specified by the sell-side analysts was €77.00 (December 31, 2019: €62.50).

Investment-grade credit rating affirmed

The KION Group continues to have an investment-grade credit rating. In October 2020, Fitch Ratings reaffirmed the Group’s long-term issuer default rating of BBB– with a stable outlook and its short-term issuer default rating of F3. The new bond placed by KION GROUP AG in September was given a rating of BBB–.

Standard & Poor’s confirmed KION’s issuer rating of BB+ with a stable outlook in November 2020 and awarded a senior unsecured rating of BB+.