KION Group withdraws its outlook for the financial year 2022
– Supply bottlenecks and substantially higher procurement costs are putting pressure on the Group’s adjusted EBIT
– Given the political and economic uncertainties, it is currently not possible to assess the KION Group’s business performance for the year as a whole.
– CEO Smith: “The fundamental drivers of our industry are well intact. We continue our focus on profitable growth and the implementation of our KION 2027 strategy.”
In view of the ongoing and substantial uncertainties in the procurement markets, which are being significantly exacerbated by the military conflict in eastern Europe as well as by recent Corona-lockdowns, the Executive Board of the KION GROUP AG decided today, Monday, April 4, 2022, to withdraw the outlook for the fiscal year 2022 published on March 3, 2022, for the KION Group and its operating segments.
“Because of the bottlenecks in the procurement markets, which are likely to last much longer than previously anticipated, as well as sharply increasing material and logistics costs and recent Corona-lockdowns which particularly affect the Asian market, the outlook for the fiscal year 2022 is no longer sustainable,” said Rob Smith, CEO of KION GROUP AG.
From the current perspective, it is impossible to reliably assess how the military conflict in eastern Europe will unfold or what its economic impact will be. “There are significant uncertainties in evaluating the Group’s business performance for the further course of the fiscal year,” concluded Smith.
A new outlook shall be prepared in the course of the year.
Based on current information, there are also indications that in contrast to strong levels of order intake and revenue, the Group’s adjusted EBIT in the first quarter of 2022 will be significantly below the prior-year figure of €215 million but within the current capital market expectations. The adjusted EBIT is likely to be on a par with that of the fourth quarter of 2021, mainly due to a lack of parts availability and a sharp rise in material costs. In addition, the KION Group expects non-recurring items in a significant double-digit million euro range in the first quarter of 2022. These non-recurring items relate to possible write-downs of assets used for business conducted with Russia.
The free cash flow of the first quarter of 2022 will also be clearly negative compared with the previous year’s figure of €262 million.
The financial key performance indicators for the first quarter of 2022 will be published on April 28, 2022.
“Our diversified position as a full-service provider in intralogistics, our strong worldwide presence, and our solid financial base have equipped us well to overcome both the pandemic and these new challenges,” said Smith. “The fundamental drivers of our industry are well intact. We continue our focus on profitable growth and the implementation of our KION 2027 strategy.”