KION Group has started the 2022 financial year with good results for order intake and revenue, but the substantial increase in procurement costs and the global supply chain disruptions continued to impact the group's profitability. In addition, the already-troubled situation has intensified further due to the war in Ukraine. There have also been new coronavirus lockdowns, which affected the Asian region in particular, the company says in its latest update.
KION 's order intake rose by 10.4% to EUR2.9 billion (USD3.1 billion) in the reporting period. The company says it started the new financial year with a well-filled order book from 2021.
Group revenue increased by 15.1% to EUR2.734 billion (USD2.87 billion). Consistently strong revenue growth in the service business was also achieved in the first quarter of the new financial year. Services accounted for 40.2% of group revenue.
"The ongoing escalation of materials and logistics costs and the continuing bottlenecks in procurement markets impacted our business, as was already the case in Q4 2021," says Rob Smith, KION CEO. "Despite these circumstances, we were able to significantly increase order intake and revenue compared to the previous year thanks to ongoing demand."
He believes the group is still in a strong position going forward: "We are represented on all key global markets as a leading full-service provider in intralogistics. The fundamental drivers of our industry are still intact, as demonstrated by the full order books. We will continue to focus on profitable growth and the implementation of our strategy, KION 2027."
In view of the ongoing and substantial uncertainties in the procurement markets, which are being significantly exacerbated by the war in Ukraine and renewed coronavirus lockdowns (especially in Asia), the KION executive board decided on 4 April to withdraw the outlook for 2022 that had been published in the 2021 annual report.
Although the KION Group believes that the fundamental driving factors in the intralogistics industry remain intact, there are significant uncertainties with regard to evaluating the Group's business performance over the further course of the year. “From the current perspective, it is not possible to reliably assess how the war in Ukraine or the coronavirus pandemic will unfold or what their economic impact will be,” directors say. “The bottlenecks in the procurement markets, which are persisting for much longer than anticipated, and continuing sharp rises in the cost of materials and logistics costs will have a particularly adverse effect on the KION Group's adjusted EBIT and free cash flow. This applies to both segments in equal measure.”