Earnings

The cost of sales rose at a slower rate than revenue, increasing by 24.9 percent to €3,702.6 million (H1 2020: €2,964.8 million). The KION Group’s gross margin therefore rose to 25.5 percent in the period under review (H1 2020: 24.5 percent). This was primarily driven by the increase in the gross margin in the Industrial Trucks & Services segment thanks to a limited rise in fixed costs. Gross profit in the Supply Chain Solutions segment, meanwhile, was up significantly due to strong revenue growth. In this segment too, revenue grew at a faster rate than the mainly volume-related increase in functional costs. Selling expenses rose by just 5.2 percent, partly because of the ongoing restrictions on travel and marketing activities, whereas administrative expenses and research and development costs increased year on year by 8.7 percent and 11.1 percent respectively. Purchase price allocation effects included in the cost of sales and in other functional costs were lower overall than in the prior-year period. The ‘other’ item includes not only income and expense resulting from currency translation but also line items such as the share of profit (loss) of equity-accounted investments, which amounted to a profit of €10.3 million (H1 2020: loss of €3.6 million).

The change in the cost of sales and in other functional costs is shown in the following condensed income statement.

The net financial expenses, representing the balance of financial income and financial expenses, improved to €19.2 million (H1 2020: €46.9 million). Reasons for this included the further reduction in borrowing, improved net interest income / expense from the leasing business, and lower net expenses in respect of the retirement benefit obligation.

Income tax expenses rose significantly year on year to €104.4 million (H1 2020: €40.2 million), reflecting the level of earnings. However, the effective tax rate fell to 26.4 percent (H1 2020: 44.2 percent). The figure for the comparative period of 2020 had been influenced in particular by high non-tax-deductible expenses and losses that could not be utilized for tax purposes owing to the level of earnings.

Net income for the period came to €291.2 million, which was substantially higher than in the same period of the previous year (H1 2020: €50.6 million). Basic earnings per share attributable to the shareholders of KION GROUP AG came to €2.21 (H1 2020: €0.46) based on 131.1 million (H1 2020: 118.0 million) no-par-value shares.