KION GROUP AG (KIGRY) Q1 2025 Earnings Call Transcript

2025-04-30 15:10:22 ET

KION GROUP AG (KIGRY)

Q1 2025 Earnings Conference Call

April 30, 2025 09:00 AM ET

Company Participants

Rob Smith - Chief Executive Officer

Christian Harm - Chief Financial Officer

Conference Call Participants

Gael De-Bray - Deutsche Bank

Tore Fangmann - Bank of America

Sven Weier - UBS

Ben Uglow - Oxcap

Martin Wilkie - Citi

Alexander Hauenstein - DZ Bank

Presentation

Operator

Ladies and gentlemen, welcome to the KION GROUP Q1 2025 Update Call. I'm Moritz, your Chorus Call operator. I would like to remind you that all participants will be in a listen-only mode and the conference is being recorded. The presentation will be followed by a question-and-answer session [Operator Instructions]

At this time, it's my pleasure to hand over to Rob Smith. Please go ahead, sir.

Rob Smith

Thank you, Moritz. Good afternoon, ladies and gentlemen, and welcome to our Update Call for the first quarter. Please refer to our update call presentation on the IR website for continuity during this call. I'm going to start with a quick summary of our first quarter 2025 and share some key highlights of the quarter, especially coming from some trade fairs that we've – there’s some key trade fairs in Europe and the United States last month. Then Christian is going to take you through our detailed financials. He'll reiterate our guidance for 2025, and I'll be back with some key takeaways, and we'll go into questions-and-answers.

So let's go together, please, to Page 3. KION had a solid start this year, in line with our expectations. Group order intake was €2.7 billion, an 11% increase compared to the prior year and reflects higher demand in both operating segments during the first quarter, despite the increasing geopolitical uncertainties surrounding tariffs and their impact or potential impact on economic developments around the globe.

Revenue was down slightly at the KION level and in both segments, due to the subdued demand in the new truck and project business in recent quarters. Adjusted EBIT decreased 14% and was €196 million, corresponding with an adjusted EBIT margin of 7%. While adjusted EBIT in Supply Chain Solutions improved strongly, performance in ITS reflected the expected negative impact of lower volumes. Free cash flow was positive €30 million, and earnings per share were minus €0.36, reflecting €191 million expenses for the efficiency program recorded in the first quarter.

Moving to Page 4. You will recall Consumer Electronics Show in Las Vegas in January this year, we announced the first results from our cooperation with NVIDIA and Accenture. We're the first industrial company to adopt NVIDIA's physical AI and are creating a vision for warehouses that are part of a smart, agile system that evolve with the world around them and can handle nearly any supply chain challenge.

We've seen three developments in recent years. We've seen a huge rise of e-commerce and software centricity in the warehouse. We've seen a demand for speed and delivery. Delivery overnight or same-day delivery is now the new normal worldwide. And supply chain resilience is a critical factor and is increasing in importance in all our customers' minds....

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