Earnings and profitability

EBIT, EBITDA and ROCE

Earnings before interest and tax (EBIT) jumped significantly year on year, rising by €404.9 million to €794.8 million. The figure for 2020 of €389.9 million had been heavily impacted by the coronavirus pandemic. EBIT for 2021 included a good level of positive non-recurring items, which amounted to income of €37.8 million (2020: expense of €65.1 million). The prior-year figure had mainly included components of the capacity and structural program (expense of €45.8 million) and impairment losses on non-current assets. The very satisfying level of orders on hand enabled the KION Group to adjust the capacity program and reverse excess provisions; taking account of the ongoing program costs, there were positive non-recurring items amounting to income of €8.2 million. Plan adjustments affecting defined benefit obligations resulted in further non-recurring items that amounted to income of €32.7 million. At the same time, purchase price allocation effects declined slightly to an expense of €84.8 million (2020: €91.9 million).

The Group’s EBIT adjusted for purchase price allocation effects and non-recurring items (adjusted EBIT) amounted to €841.8 million, which was up substantially (by 53.9 percent) on the figure for 2020 of €546.9 million. The adjusted EBIT margin improved from 6.6 percent in the previous year to 8.2 percent in the reporting year.

EBIT

in € million

2021

in % of revenue

2020

in % of revenue

EBIT

794.8

7.7%

389.9

4.7%

Adjustment by functional costs:

 

 

 

 

+ Cost of sales

12.6

0.1%

54.9

0.7%

+ Selling expenses and administrative expenses

39.9

0.4%

84.5

1.0%

+ Research and development costs

–4.0

–0.0%

2.9

0.0%

+ Other costs

–1.4

–0.0%

14.7

0.2%

Adjusted EBIT

841.8

8.2%

546.9

6.6%

adjusted for non-recurring items

–37.8

–0.4%

65.1

0.8%

adjusted for PPA items

84.8

0.8%

91.9

1.1%

Earnings before interest, tax, depreciation, and amortization (EBITDA) rose to €1,735.7 million (2020: €1,327.7 million). The Group’s EBITDA adjusted for the positive non-recurring items (adjusted EBITDA) amounted to €1,696.9 million (2020: €1,383.5 million), giving an adjusted EBITDA margin of 16.5 percent (2020: 16.6 percent).

EBITDA

in € million

2021

in % of revenue

2020

in % of revenue

EBITDA

1,735.7

16.9%

1,327.7

15.9%

Adjustment by functional costs:

 

 

 

 

+ Cost of sales

–26.0

–0.3%

14.8

0.2%

+ Selling expenses and administrative expenses

–6.7

–0.1%

37.1

0.4%

+ Research and development costs

–4.2

–0.0%

2.7

0.0%

+ Other costs

–1.9

–0.0%

1.3

0.0%

Adjusted EBITDA

1,696.9

16.5%

1,383.5

16.6%

adjusted for non-recurring items

–38.7

–0.4%

55.8

0.7%

adjusted for PPA items

0.0

0.0%

0.0

0.0%

Adjusted EBITDA for the long-term lease business, which is derived from internal reporting and assumes a minimum rate of return on the capital employed, amounted to €324.3 million (2020: €326.3 million).

Return on capital employed (ROCE), which is the ratio of adjusted EBIT to capital employed, was up sharply year on year at 9.1 percent (December 31, 2020: 6.2 percent). This can be explained by the sharp rise in earnings and a proportionately smaller increase in capital employed at the end of 2021.