Kion Group Ag · XETR:KGX
Kion — Investor Day (November 2022)
22 slides from Kion's investor day presentation, November 2022
Slide 1: Leasing Business Deep Dive Update 2022
Leasing Business Deep Dive Update 2022 Frankfurt, November 2022
Slide 2: Agenda
Agenda 1. Business Model and Strategy 2. Funding 3. Risk Management 4. Lease Accounting & Reporting 5. Key takeaways 2 KION GROUP AG | Leasing Business Deep Dive | Update 2022
Slide 3: Integrated Business Model within Industrial Trucks and Services
Integrated Business Model within Industrial Trucks and Services Leasing is an important component growing the business • Technology and innovation • Sales support vehicle with New truck sales Financial services leadership benefit for aftermarket and Around half of new • Tailor-made solutions and ser
Slide 4: Leasing and Rental Strategy
Leasing and Rental Strategy Integrated approach to drive profitable growth • Full support of life cycle management (LTR1, STR2, service, used trucks) • Serve customers’ needs • Strong customer focus to optimized • Full integration into Profit & penetration and retention regional sales structures Res
Slide 5: Lease Accounting – KION's Leasing and Rental Business
Lease Accounting – KION’s Leasing and Rental Business Contract and financing structure overview Rental business (Short-Term) Leasing business (Long-Term) Direct business Indirect business Refinancing KION Customer partner Sale Lease contract Vendor contract Financial Lease KION Customer liability co
Slide 6: Agenda
Agenda 1. Business Model and Strategy 2. Funding 3. Risk Management 4. Lease Accounting & Reporting 5. Key takeaways 6 KION GROUP AG | Leasing Business Deep Dive | Update 2022
Slide 7: Funding Structure of Leasing & Short-Term Rental Business
Funding Structure of Leasing & Short-Term Rental Business Increasing share of ABS / RCF optimizing funding condition Maturity Matched Interest Instrument Balance Sheet Position in €m1 Funding Matched Funding 1,161 ABS 947 530 98 1,598 SALB (Sale-and- 1,631 1,778 Lease-Back) 1,778 213 Indirect Leasin
Slide 8: Refinancing of Leasing Business
Refinancing of Leasing Business The majority of KION´s leasing portfolio is matched funded Maturity profile as of September 31 2022 Refinancing structure ABS are prolonged on a yearly basis Very high share of matched funding which benefits from optimized cost structure Due to better funding co
Slide 9: Agenda
Agenda 1. Business Model and Strategy 2. Funding 3. Risk Management 4. Lease Accounting & Reporting 5. Key takeaways 9 KION GROUP AG | Leasing Business Deep Dive | Update 2022
Slide 10: Risk Management Categories
Risk Management Categories All risk categories are actively managed and mitigated • Conservative residual value strategy in place since FY 2001 Residual Value • LTR1 residual values allow for attractive profit margins in our used truck business Risk • KION has never recorded significant aggregated r
Slide 11: Resilient Earnings Contribution
Resilient Earnings Contribution Despite difficult times no significant impact on profitability of existing portfolio • Selective use of contract adaptions to support customers experiencing disruptions MEASURES • Utilization of short-term rental fleets to support increased demand for Meeting our cust
Slide 12: Agenda
Agenda 1. Business Model and Strategy 2. Funding 3. Risk Management 4. Lease Accounting & Reporting 5. Key takeaways 12 KION GROUP AG | Leasing Business Deep Dive | Update 2022
Slide 13: Lease Accounting – Balance Sheet
Lease Accounting – Balance Sheet Increase in (lease) liabilities resulting from growth of leasing business Overview • Many of KION Group’s balance sheet items are related to leasing business, especially: • Leased assets • Rental assets • Lease receivables • Liabilities from lease business • Liabilit
Slide 14: Lease Accounting – Balance Sheet: Direct leasing drives balance sheet
Lease Accounting – Balance Sheet Direct leasing business drives KION’s balance sheet Leasing and rental balances as at Dec 31, 2021 (2020) Direct vs. indirect leasing as at Dec 31, 2021 (2020) Leasing business Leased assets Leased assets Liabilities from lease €1,391.5 m (€1,333.3 m) (Operating leas
Slide 15: Lease Accounting – Balance Sheet: Specific accounts
Lease Accounting – Balance Sheet Specific accounts with bigger movements, overall parallel development (in €m) FY 2019 FY 20201 FY 2021 Change 2019 - 2020 Change 2020 - 2021 Sales Industrial Truck & Services (total) 6,410 5,723 6,514 -11% 14% thereof New Business (third party) 3,346 2,735 3,107 -18%
Slide 16: Lease Accounting – Income Statement
Lease Accounting – Income Statement Leasing business contributes 12% to total KION Revenue Leasing (FL) = €708m Leasing (OL) = €537m Rental (OL) = €463m Leasing & Rental business accounts for 17% of total KION Revenue and 26% of total IT&S Revenue Leasing only (FL & OL) accounts for 12% of total
Slide 17: Lease Accounting – Income Statement: Finance vs Operating Lease
Lease Accounting – Income Statement Timely recognition of income differs between Finance and Operating Lease FY 2021 LTR1 (FL) LTR1 (OL) STR2 (OL) Finance Lease (FL) vs. Operating Lease (OL) New Rental Rental Business line (In-) direct leasing business classified as a Finance Lease business busine
Slide 18: Lease Accounting – Cash Flow Statement
Lease Accounting – Cash Flow Statement Leasing business is operating cash flow accretive Understanding the cash flow statement KION’s leasing business is presented as operating cash flow 1. Earnings before interest and tax is the basis for the (indirect) calculation of the operating cash flow (OCF)
Slide 19: Agenda
Agenda 1. Business Model and Strategy 2. Funding 3. Risk Management 4. Lease Accounting & Reporting 5. Key takeaways 19 KION GROUP AG | Leasing Business Deep Dive | Update 2022
Slide 20: Leasing Business Deep Dive Key takeaways
Leasing Business Deep Dive Key takeaways 1. Leasing business is an important component of the integrated IT&S business model 2. Well managed risk profile with resilient income streams 3. Optimized refinancing structure supports competitive funding costs 4. Leasing operations are EBIT and operating c
Slide 21: Disclaimer
Disclaimer This document has been prepared by KION GROUP AG (the “Company”, and together with its consolidated subsidiaries, the "KION Group") solely for informational purposes. This disclaimer shall apply in all respects to the entire presentation (including all slides of this document), the oral p
Slide 22: GRO U P
GRO U P