Financial position of the KION Group

The principles and objectives applicable to financial management as at September 30, 2024 were the same as those described in the 2023 combined management report.

Analysis of capital structure

Non-current and current liabilities amounted to €12,036.0 million as at September 30, 2024, which was €420.3 million higher than the figure as at December 31, 2023 of €11,615.7 million.

Non-current financial liabilities decreased to €617.6 million as at September 30, 2024 (December 31, 2023: €1,306.6 million). This was the result of maturity-related reclassifications to current liabilities, which related both to a corporate bond maturing in September 2025 with a current carrying amount of €498.8 million (December 31, 2023: €498.0 million) and to the non-current promissory notes, whose carrying amount fell to €448.6 million (December 31, 2023: €626.5 million). Non-current liabilities to banks increased slightly to €169.0 million (December 31, 2023: €164.2 million).

Current financial liabilities rose to a total of €893.2 million as at September 30, 2024 (December 31, 2023: €215.8 million). In addition to the corporate bond, this included a total of €179.5 million for the two tranches of the promissory note now recognized as current and a sum of €93.0 million related to issues under the commercial paper program (December 31, 2023: €20.0 million). The figure was reduced by the repayment, in an amount of €69.5 million, of a promissory note tranche that matured in the second quarter of 2024. Liabilities to banks fell to €88.5 million (December 31, 2023: €108.2 million).

Net financial debt (non-current and current financial liabilities less cash and cash equivalents) decreased to €1,115.3 million as at September 30, 2024 (December 31, 2023: €1,210.6 million). This equated to 0.6 times adjusted EBITDA on an annualized basis (December 31, 2023: 0.7 times). To reconcile the net financial debt with the industrial net operating debt (INOD) of €2,562.7 million as at September 30, 2024 (December 31, 2023: €2,566.2 million), the liabilities from the short-term rental business of €761.5 million (December 31, 2023: €716.6 million) and the liabilities from procurement leases of €685.9 million (December 31, 2023: €639.0 million) are added to net financial debt.

An increase in the financing volume meant that non-current and current liabilities from the lease business rose to €4,185.6 million as at September 30, 2024 (December 31, 2023: €3,756.2 million). Of this total, €4,062.3 million was attributable to the financing of the direct lease business (December 31, 2023: €3,620.5 million) and €123.3 million to the repurchase obligations resulting from the indirect lease business (December 31, 2023: €135.7 million).

Contract liabilities, which mainly relate to prepayments received from customers in connection with the long-term project business in the Supply Chain Solutions segment, decreased to €706.7 million as at September 30, 2024 (December 31, 2023: €773.3 million).

The retirement benefit obligation and similar obligations under defined benefit pension plans rose to €786.5 million as at September 30, 2024 (December 31, 2023: €775.7 million) due to a moderate decline in discount rates.

Consolidated equity increased to €5,924.9 million as at September 30, 2024 (December 31, 2023: €5,772.7 million). The net income of €255.6 million earned during the first nine months of 2024 contributed to the rise in equity. The actuarial gains and losses arising from the measurement of pensions, which amounted to a net loss of €18.1 million (after deferred taxes), also had an impact on equity, as did the currency translation gains of €8.3 million. Both amounts were recognized in other comprehensive income. KION GROUP AG’s dividend payout reduced equity by €91.8 million. The equity ratio of 33.0 percent was almost unchanged from its level as at the end of 2023 (December 31, 2023: 33.2 percent).

Analysis of capital expenditure

The KION Group’s capital expenditure on property, plant and equipment and on intangible assets (excluding right-of-use assets from procurement leases) in the period under review gave rise to cash payments of €289.0 million (Q1–Q3 2023: €281.6 million). The focus in the Industrial Trucks & Services segment was on product development and the expansion and modernization of production and technology facilities. Capital expenditure in the Supply Chain Solutions segment predominantly related to development costs.

Analysis of liquidity

Cash and cash equivalents rose to €395.5 million as at September 30, 2024 (December 31, 2023: €311.8 million).

Taking into account the credit facility of €1,385.7 million that was freely available and, as at the reporting date, entirely unutilized (December 31, 2023: €1,364.7 million), the unrestricted cash and cash equivalents available to the KION Group as at September 30, 2024 amounted to €1,779.8 million (December 31, 2023: €1,674.4 million).

Cash flow from operating activities came to €695.4 million in the first three quarters of 2024 (Q1–Q3 2023: €599.2 million). These cash inflows were higher year on year primarily because of the significantly improved operating profit and because net working capital decreased slightly after having increased sharply in the prior-year period. Cash outflows encompassed the variable remuneration that was paid and the payments for income taxes, which were much higher than in the prior-year period due to the success of the 2023 financial year.

Net cash used for investing activities amounted to minus €264.1 million in the first nine months of 2024, which was close to the level of the prior-year period (Q1–Q3 2023: minus €269.8 million). Within this total, cash payments in respect of capital expenditure increased slightly to minus €289.0 million (Q1–Q3 2023: minus €281.6 million), of which minus €92.7 million was attributable to capitalized development costs (Q1–Q3 2023: minus €82.4 million).

Free cash flow – the sum of cash flow from operating activities and investing activities – increased to €431.3 million in the reporting period (Q1–Q3 2023: €329.3 million).

Net cash used for financing activities amounted to minus €345.5 million in the period under review and was therefore on a par with the prior-year period (Q1–Q3 2023: minus €349.8 million). Additions to and repayments of financial debt mainly related to current additions and repayments under the commercial paper program and the syndicated revolving credit facility (RCF) as well as the aforementioned repayment of the tranche of the promissory note. Payments made for interest portions and principal portions under procurement leases totaled minus €126.2 million (Q1–Q3 2023: minus €117.3 million). Current interest payments on financial debt amounted to minus €44.6 million and were therefore lower than the prior-year level (Q1–Q3 2023: minus €50.7 million). Payments as a result of other financing activities, which mainly related to the repayment of factoring liabilities, totaled minus €64.4 million (Q1–Q3 2023: receipts of €0.2 million). The distribution of a dividend to the shareholders of KION GROUP AG resulted in an outflow of funds of minus €91.8 million.