Fundamentals of the KION Group
The accounting policies used in this interim report are essentially the same as those used for the year ended December 31, 2022. The reporting currency is the euro.
Management and control
On January 1, 2023, Marcus A. Wassenberg joined the Executive Board of KION GROUP AG as Chief Financial Officer (CFO). Mr. Wassenberg left the Company with effect from July 6, 2023. On the same day, Christian Harm was appointed as a member of the Executive Board and CFO of KION GROUP AG for a term of three years. Mr. Harm has been an employee of the Company and its predecessors for 20 years. Most recently, he held the position of Executive Vice President Finance in the KION Group’s ITS EMEA Operating Unit.
Valeria Gargiulo has taken on the newly created role of Chief People & Sustainability Officer (CPSO) with effect from May 1, 2023, and the Supervisory Board reappointed Andreas Krinninger as an Executive Board member for a further five years. He will continue to head up the Industrial Trucks & Services segment in the EMEA region. His new five-year term begins on January 1, 2024.
Dr. Michael Macht stepped down from his roles as a member and the chairman of KION GROUP AG’s Supervisory Board with effect from the end of the Annual General Meeting on May 17, 2023. The AGM elected Dr. Nicolas Peter as a new Supervisory Board member to fill the seat vacated by Dr. Macht. Hans Peter Ring, who has been a member of the Supervisory Board since June 2013, was elected as chairman of the Supervisory Board at the Supervisory Board’s constitutive meeting immediately after the AGM. Mr. Ring handed over the role of chairman of the Audit Committee to Dr. Nicolas Peter.
Strategy of the KION Group
The KION 2027 strategy, which was revised and updated in 2022, provides the framework for profitable growth across the KION Group and specifies five groupwide targets.
- Growth: The KION Group aims to grow at a faster rate than the global material handling market by offering integrated, automated, and end-to-end solutions for specific industries and customer requirements in both its operating segments.
- Profitability: The KION Group takes systematic action to bring the business back on course for profitable growth. Its ambition in this respect is to raise its adjusted EBIT margin above 10 percent on a permanent basis, both at Group level and at operating segment level in Industrial Trucks & Services and Supply Chain Solutions.
- Efficient use of capital: The KION Group continually strives to optimize the return on capital employed (ROCE). Besides increasing earnings, the focus here is on asset management and efficient use of capital.
- Resilience and agility: Profitability throughout the various market cycles is to be guaranteed by a robust business model. This will involve greater diversification in terms of regions and customer sectors alongside efforts to expand the service business and further optimize the production network and internal processes.
- Sustainability: Through innovation, ideas, and decisive action, the KION Group is helping to drive sustainability in logistics. We have put in place ambitious targets and a clear sustainability strategy. The KION Group contributes to climate change mitigation and enhances safety for its customers and its employees by means of its products, solutions, and services and by making logistics processes more sustainable.
The implementation of the strategy is based on six fields of action:
By supplying integrated end-to-end systems from a single source, the KION Group is addressing the central customer demand for solutions that are simple, reliable, and flexible, as well as energy- and cost-efficient. Cross-brand solutions were developed and presented to customers during the reporting period. The KION Group is also stepping up its multi-brand strategies in its sales operations, for example by expanding its dealer network in the fast-growing Chinese market.
Growth plans for specific regions
The KION Group is helping to drive growth across its business through regional growth strategies that are flexible, efficient, and targeted at the requirements of the local market. In Jinan, China, progress was made toward the completion of the new Supply Chain Solutions plant. Production of counterbalance trucks had already commenced at the site in 2022. In February 2023, the KION Group started construction of a state-of-the-art distribution center for spare parts in Kahl am Main, Germany. This new site will raise the efficiency of parts delivery to the customers of both segments.
The Group’s focus on sustainability in the dimensions ‘people, products, and processes’ is reflected in its efforts to manufacture products that are as eco-friendly and safe as possible, to use climate- and environmentally friendly manufacturing processes, and to provide a safe and non-discriminatory working environment. At the start of July 2023, KION GROUP AG signed up to the Science Based Targets initiative (SBTi), which provides an underlying methodology and scientific basis for KION’s ongoing support of the United Nations’ Paris Agreement and its goal of limiting global warming to 1.5°C. Through the SBTi, KION has enshrined its long-term goal of reaching net zero greenhouse gas emissions along its value chain (scope 1, 2, and 3) by 2050, and set related interim goals up to 2030. In addition, KION continued to focus on developing and enhancing energy-efficient solutions in the first half of 2023. As a result of its efforts in this regard, the Company’s proprietary fuel cell systems and AI-assisted energy management solutions were developed to market maturity. A strategic partnership with Li-Cycle Holdings Corp. from Canada allows KION to recycle lithium-ion batteries by means of a complex process that recovers key materials fur subsequent reuse.
Automation and software
In the automation field, the KION Group provides customer-specific and scalable solutions catering to customers’ requirements. These are helping customers move closer to the goal of a ‘lights-out’ warehouse. The ongoing development of automated guided vehicles (AGVs) and autonomous mobile robots (AMRs) that can be easily integrated into customers’ production and warehouse environments was a priority in the first half of 2023. An interface standard for communication between automated guided vehicle systems that was jointly developed by the KION Group has already undergone one round of trials.
Performance and agility
Continual improvements to the KION Group’s efficiency and agility are making its business model ever more resilient. For example, it continued its work on developing a global platform for industrial trucks in the value segment. A first set of trucks using the new modular configuration concept was already brought to market in the first half of 2023. The Group plans to launch more than 30 models with a modular configuration by the end of 2024.
Values, people, and leadership
The KION Group’s corporate values of integrity, collaboration, courage, and excellence guide our individual and collective actions. The HR strategy therefore focuses on recruiting and developing talented individuals from around the world for the intralogistics Group, on equipping internal teams with all necessary skills, and on further embedding a diverse, equitable, and inclusive culture that secures the commitment of employees and unlocks their long-term potential to the fullest possible extent.