Financial performance

Overall assessment of the economic situation

Even after nine months of 2020, the KION Group’s revenue still reflects the substantial adverse impact of the coronavirus pandemic. New truck business in the Industrial Trucks & Services segment continued to decline markedly owing to the high proportion of revenue generated in the EMEA region. The segment’s revenue fell by 12.6 percent, and the 3.8 percent increase in revenue in the Supply Chain Solutions segment was not enough to make up for this. Consequently, consolidated revenue went down by 8.0 percent to €6,000.2 million (Q1–Q3 2019: €6,524.2 million).

By contrast, the Group’s order intake increased by 2.8 percent to €6,715.4 million (Q1–Q3 2019: €6,534.5 million). This was driven by the Supply Chain Solutions segment, which again secured major new project orders in the third quarter and was therefore able to maintain the positive trend seen in the first half of the year. Having fallen sharply in the first six months of this year, order intake in the Industrial Trucks & Services segment began to recover slowly in the third quarter but was still down significantly year on year for the reporting period as a whole.

Adjusted EBIT dropped by €260.9 million to €363.8 million and was therefore considerably lower than in the prior-year period (Q1–Q3 2019: €624.7 million), which had seen strong earnings in the third quarter. The adjusted EBIT margin for the first three quarters of 2020 thus fell by 3.5 percentage points to 6.1 percent and remained well below the figure for the same period of last year (Q1–Q3 2019: 9.6 percent).

Net income for the period reduced to €132.5 million (Q1–Q3 2019: €338.9 million). Basic earnings per share decreased to €1.18 (Q1–Q3 2019: €2.88). Free cash flow was in negative territory at minus €114.3 million (Q1–Q3 2019: €53.0 million), primarily due to the sharp fall in operating profit. The reduced volume of business meant that the amount of net working capital tied up during the year was lower than in the prior-year period, but higher tax payments and the acquisition of DAI in March 2020 had a negative effect on free cash flow overall in the reporting period.

Net financial debt rose by €258.3 million to €1,867.6 million as at September 30, 2020 and therefore equated to 1.3 times adjusted EBITDA on an annualized basis. The placement of a corporate bond with a total volume of €500.0 million and a term of five years increased the flexibility of the KION Group’s funding over the long term. The bond, placed on the capital markets on September 24, 2020, will facilitate the repayment of the variable-rate tranches of the promissory note maturing in May 2022 with a total nominal value of €653.5 million ahead of schedule on October 30, 2020.

Business situation and financial performance of the KION Group

Level of orders

Despite the difficult market conditions, the KION Group’s order intake increased by 2.8 percent year on year to €6,715.4 million (Q1–Q3 2019: €6,534.5 million). The sharp 10.9 percent drop in order intake to €4,076.7 million in the Industrial Trucks & Services segment (Q1–Q3 2019: €4,577.5 million) was more than made up for by the substantial 35.1 percent rise to €2,631.5 million in the Supply Chain Solutions segment (Q1–Q3 2019: €1,947.6 million). The business of automated solutions for global supply chains, which is influenced by long-term trends and customer expectations, has – more than ever – proved to be a significant source of stability for the KION Group’s business model during the coronavirus pandemic.

Overall, currency effects had only a small impact on the value of KION Group’s order intake, reducing it by €60.2 million.

At €4,144.4 million, the Group’s order book had grown by 14.1 percent compared with the end of 2019 (December 31, 2019: €3,631.7 million), mainly thanks to the project business order book in the Supply Chain Solutions segment. This has created good foundations for the coming fourth quarter.