KION shares

Upward trend in the equity markets

The German equity markets made significant price gains over the course of 2021. In March of the reporting year, the DAX exceeded 15,000 points for the first time. Over the year as a whole, it gained 15.8 percent and reached a record high of 16,251.13 points on November 17. The MDAX added 14.1 percent over the same period, almost matching the performance of the DAX for the year.

Particularly in the first half of 2021, the biggest companies on Germany’s stock markets benefited from strong growth and a disproportionately steep rise in corporate profits. The economy’s recovery from the slump triggered by the coronavirus pandemic in 2020 had a positive impact on companies, as did the effects of cost-cutting and efficiency measures. However, hopes that the pandemic would soon be overcome were dashed in the second half of the year when case numbers started to go back up. Global bottlenecks in the supply of commodities and other products also escalated, thereby dampening the factors that were driving economic growth. Moreover, expectations were increasing that central banks – starting with the US Federal Reserve – would introduce more restrictive monetary policy in view of rising inflation. As a result, the DAX and MDAX trended sideways from the middle of the year onward.

KION shares outperform benchmarks and reach all-time high

In the generally benign stock market conditions, KION shares performed very well and comfortably exceeded their benchmarks with a price rise of 35.6 percent. For the first time, KION shares broke through the €100 barrier and reached their highest ever price in the Company’s history of €103.70 on November 16, 2021. This performance was underpinned by a sharp rise in order intake and revenue during the year in both operating segments, with earnings increasing at an even faster rate at the same time. The shares closed at €96.48 on December 30, 2021. Based on around 131.1 million shares outstanding, this equates to market capitalization of €12.6 billion, of which approximately €6.9 billion was attributable to shares in free float. The KION Group is therefore one of the heavyweights of the MDAX.

Share price performance 2021 compared with the DAX and MDAX

Dividend payout rate for 2021 to increase to 35 percent

The pandemic meant that KION GROUP AG’s 2021 Annual General Meeting on May 11, 2021 again took place as a virtual event without shareholders being physically present. More than 300 people watched the proceedings. Approximately 84 percent of shares were represented and all of the motions were approved by a majority of votes. This included the distribution of a dividend of €0.41 per share. With earnings per share for 2020 of €1.81, this equates to a dividend payout rate of around 25 percent.

The Executive Board and Supervisory Board of KION GROUP AG will propose a dividend for 2021 of €1.50 per share (2020: €0.41) to the Annual General Meeting on May 11, 2022. This gives a total dividend payout of €196.7 million. With earnings per share for 2021 of €4.34, this equates to a dividend payout rate of around 35 percent. Under its dividend policy, the KION Group has raised the upper end of the dividend payout rate from 35 percent to 40 percent and will aim for a dividend payout rate of between 25 percent and 40 percent in future years.

Shareholder structure remains stable

As far as the Company is aware, the shareholder structure remained unchanged in the reporting year. Weichai Power Co., Ltd., Weifang, People’s Republic of China, had a stake of 45.2 percent as at the end of 2021, which means it is still the biggest single shareholder, while KION GROUP AG continues to hold around 0.1 percent of the shares. A total of 15,953 shares (2020: 18,467 shares) were acquired by staff under the KION Employee Equity Program (KEEP). Consequently, the number of shares held in treasury stood at 96,224 as at the reporting date (December 31, 2020: 112,177). The free float therefore continued to account for around 54.7 percent at the end of 2021.

Shareholder structure as at December 31, 2021

KION shares mainly recommended as a buy

As at December 31, 2021, 21 brokerage houses were following and reporting on the KION Group (December 31, 2020: 20). Of this total, 14 analysts recommended KION shares as a buy, six rated them as neutral, and only one brokerage house advised selling them. The average target price specified by the sell-side analysts was €107.00 (December 31, 2020: €76.03).

Further improvement on credit ratings

There was a further improvement in the credit ratings awarded to the KION Group by the two rating agencies in the year under review. In September 2021, Fitch Ratings raised the Group’s long-term issuer default rating from BBB– to BBB with a stable outlook. At the same time, the short-term issuer default rating was upgraded from F3 to F2.

In May 2021, Standard & Poor’s initially confirmed its issuer rating of BB+ and raised the outlook from stable to positive. It then raised this rating to BBB– with a stable outlook in August 2021.