kion group

Wiesbaden, June 2010

KION GroupCorporate presentation

2

Content

1. Overview KION Group

2. Facts & Figures

3. Activities

4. Strategy

5. Summary

3* by Carl von Linde, Hugo Güldner and other partners

1900 1910 1920 1930 1940 19601950 1970 1980 1990 2000 2010

2009Integration of Baoli as fourth brand

Group HistoryFour brands and over 100 years experience

Founding of Güldner Motoren-Gesellschaft*

Founding of STILL

Founding of OM

Linde takes over Güldner

Linde takes over STILL

Linde takes over OM

2006The brands are placed under one new roof: KION Group

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Market Order Intake 2009Global recession puts pressure on material handling market

in thousand units

Americas-41%

Western Europe-39%

Eastern Europe

-71%

Asia (excl. China)

-42%

China+4%

Global market declined by 37% to 548.000 trucksKION Group kept global market share stable at ~17%

Source: WITS

’08 ’09

298181

2171

’09’08

’08

119

’09

20089

’09

154

’08

’09

113

’08

118

4

5

Global Market Material HandlingIndustrial Trucks Market by Region 2009

Western Europe 33%

Eastern Europe 4%North America 18%

South America 4%

China 22%

Asia* 16%

RoW 3%Germany 22%

France 21%

Italy 12%

UK 9%

Spain 6%

Russia 2%

Eastern Europe** 9%

Rest of Europe 19%

World 100% = 547,000 units

Europe 100% = 200,000 units

100%

* excluding China ** excluding Russia

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A global player and market leader in Europe4 unique brands – one strong group

KION GroupShare of total sales

Baoli– Core brand for the expansion of the economy segment– Targeting Asia, Latin America, Central & Eastern Europe

Linde Material Handling– Global premium brand, #2 worldwide– Strong presence in China, #3– Innovation and technological leader

STILL– European premium brand, leading in e-trucks– Strong presence in Brazil, #1-2– Strong service network

OM– Market leader in Italy– Attractive product range for the value segment

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7

Sales in € m

Global Player and Market Leader in Europe World Rank (2009)

7

Toyota* J

NACCO USA

Jungheinrich GER

KION GER

Source: Annual reportsForeign exchange rates for the year 2009: USD/EUR = 1.39 YEN/EUR = 130.4

* Based on calendar year reporting to allow comparison

1.058

1.677

3.084

3.301

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KION Group market positionStrong position in key markets

Market KION position 2009

Western Europe No. 1Eastern Europe No. 1Brazil No. 1-2China No. 3

World No. 2

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Global Manufacturing NetworkIndustrial truck production facilities

9

Headquarter KION Group

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Distrubution presence in more than 100 countriesSales Distribution 2/3 Direct vs. 1/3 Dealers

300 Sales Locations

300 Sales Locations

Tightest network with 730 sales locationsEurope

280 sales locations in China and rest of Asia

Asia

300 established sales locations North America

Network of 60 sales locationsSouth America

Bridgeheads worldwide30 sales locations in Rest of the World

More than 5,400 service engineers

700 Sales Locations

100 Sales Locations 1,400 Sales Locations

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Content


2. Facts & Figures

3. Activities

4. Strategy

5. Summary

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Adressing the most severe downturn in the history of the material handling market

– Restructuring program successfully implemented and targets fully achieved

– Optimization steps to manufacturing footprint implemented

– Strong fixed cost reduction

– Effective usage of short-time work in Germany, France and Italy

– Strong position in domestic and growing markets

– Undisputed leader in Europe

– Position as leading foreign player in China strengthened with Baoli

– Strong position in Brazil

– Most dense service network in Europe, strong presence in key markets

– Effective R&D pipeline to fuel growth

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Financial Highlights 2009

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+12%413463Cash & cash equivalents

-38%173108Capital expenditures

-10%111101Total R&D expenditure

-6%21,16819,953No. of employees

-8.8%-pts.7.9%-0.9%EBIT margin (adjusted)

>-100%358-29EBIT (adjusted)

-5.5%-pts.15.6%10.1%EBITDA margin (adjusted)

-56%709311EBITDA (adjusted)

-32%4,5543,084Net sales

-31%4,3993,028Order intake

+/-20082009€m

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Research and DevelopmentSubstantial investments to keep technological edge

119111

101

2007 2008 2009

R&D expenses 2007 - 2009, KIONin €m / % of revenues – 833 employees in R&D

– Focus of R&D:– Modular construction– Energy efficiency– Reduction of emissions– New technologies like Fuel Cell– Ergonomics– Product innovations

R&D expenses 2009 – KION and Peersin €m / % of revenues

Source: Company reports

3.3%2.4%2.8%

31 34 12

101

49

0

50

100

150

KION Peer 1 Peer 2 Peer 3 Peer 4

3.3% 2.9% 1.3% 1.7%3.0%

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Employees 2009

Germany 39%

Western Europe* 42%

RoW 1%

Sales & Services 52%Production 33%

R&D 4%

Eastern Europe 6%

Americas 3%

Asia 8% Corporate Functions 8% Apprentices 3%

Split by Region (2009 year-end)100% = 19,953 Employees

Split by Function (2009 year-end)100% = 19,953 Employees

* excluding Germany

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Content


2. Facts & Figures

3. Activities

4. Strategy

5. Summary

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– Order intake: 54,400 units– Sales: 1,920 €m*

– Employees: 11,753– Market share world: ~10%– Market share Europe: ~ 21%

– Global premium brand– Technological leader;

Implementation of hydrostatic drive and fuel cells

– Pooling of technological leadership in PureMotionProgram

– Market leader in major European markets, e.g. Germany and France

– Leading independent sales & service network in China

Key facts 2009 & Product Portfolio

Linde Material Handling PureMotion: Exploiting technological leadership

* before intragroup consolidation effects

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– Order intake: 25,500 units– Sales: 1,095 €m*– Employees: 6,295– Market share Europe: ~11%

– European premium brand– Europe-wide service network with

over 2,000 technicians– Offering a holistic service concept

through STILL Partnerplan– Strong position in Brazil, market

leader in warehouse trucks


STILLLeadership in intralogistics


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– Order intake: 8,000 units– Net sales: 191 €m*– Employees: 1,038– Market share Italy: ~ 21%

– Market leader in Italy– Attractive product portfolio to

address value segment


OMValue brand with attractive product portfolio


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– Order intake: 2,600 units– Net sales: 19 €m*– Employees: 476

– Provide highly competitive material handling solutions in economy segment

– Attractive domestic market China as platform for international growth

Key Facts 2009 & Product Portfolio

BaoliNew solutions in economy segment


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Content


2. Facts & Figures

3. Activities

4. Strategy

5. Summary

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1

2

3

4

5

Targets

1. Leading manufacturer

2. Long-term growth KION > market

3. Profitability benchmark within industry

4. Higher share of business abroad

Multi-brand strategy

Establishment of group-wide common systems and processes

Tap full market potential

Positioning along whole value chain

Technologically leading products

StrategyFocus on growth, efficiency and profitability

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1No. 2 WorldNo. 1 foreign brand China

No. 1 France

No. 3 EuropeNo. 1-2 Brazil

No. 1 Italy

Top 10 domesticbrand China,Selected export markets

Global brand

Local brand

European brand+ Local brand

Local brand

Local brand

Successful multi-brand strategy Global coverage through different brands

* Local Brand of Linde Material Handling in France only

*

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2KION Group StructureOne KION: Matrix of Brands and Functions

Multi-Brand Strategy

KION Central & Select. Shared Functions

KION 3P

KION Components

Product planning, development, purchasing

Hydraulic Solutions & other components

KION Central OpsProduction, Quality, Operational Excellence,Production Control, Logistics

Organization Matrix

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3Growth strategyTap full market potential to increase foreign share

Market size

Growth strategy:– Participate in growth of emerging markets – Local products and local R&D to address market demand– Intensify sales activities and extend service network

Market share

Market growth

EasternEurope

Asia

SouthAmerica

Mature markets Growth regions

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4From pure manufacturer to partnerPositioning in value chain

Trucks

Financing

Service

Solutions

Innovations

Electrical Diesel / Gas Warehouse Tow TractorsHeavy

Rental Service Leasing Straight Sale

Maintenance and Repair

Spare Parts Fleet Management

Automation

RFIDFuel Cell

Process Consulting

IT

Value added

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Innovative products with

– lowest energy consumption

– best-in-class ergonomics and precise steering

– first-class reliability and easy maintenance

58

1715

1316

4561

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Low total cost of ownership (TCO)Differentation through technological leadership

Total cost of ownership (indexed, European operator)

Energy cost100 -19%

81

Competitor truck

KION truck

Labor cost

Service cost

Purchasing/financing cost

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Content


2. Facts & Figures

3. Activities

4. Strategy

5. Summary

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SummaryKey considerations

Leading player in an attractive growth industry

Technology provides strong efficiency benefits for the customers

Occupying whole value chain

Highly determined to exploit full synergy potential within the Group

Global set-up to participate in global growth opportunities

KION Group

kion group

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