DGAP-News: Krones AG: Krones plans to pay out a dividend of €1.40 per share for successful 2021 financial year

24 March 2022

Krones plans to pay out a dividend of €1.40 per share for successful 2021 financial year

- Krones today published its 2021 Annual Report and confirmed its preliminary figures.

- At the Annual General Meeting for the fiscal year 2021, the Executive Board and Supervisory Board will propose a dividend of €1.40 per share (previous year: €0.06 per share).

- High-growth intralogistics business is a separate segment from the beginning of 2022.

- The outlook for financial year 2022 is influenced by the Ukraine war and other uncertainties. For the full year 2022, the Executive Board forecasts revenue growth of 5% to 8%, with an improved EBITDA margin of 8% to 9% and ROCE of 10% to 12%.

Krones today published its 2021 Annual Report. The company looks back on a successful financial year in the second year of the Covid-19 pandemic. As a leading full-service supplier to the international filling and packaging industry, Krones benefited in 2021 as markets recovered faster and more strongly than expected from the 2020 pandemic-related slump. The company was able to take advantage of this thanks to its extensive product and service portfolio, recording significant growth in orders. Order intake increased by 30.5% in 2021, from €3,307.0 million to an all-time record high of €4,316.2 million. Krones had an order backlog totalling €1,893.0 million at the end of 2021, 56.3% more than a year earlier.

Revenue increased by 9.4% year on year, from €3,322.7 million to €3,634.5 million. This means Krones reached the upper end of the upgraded growth target published in July 2021 for the full year 2021 (7% to 9%).

Krones' profitability increased significantly in 2021

Due to better production capacity utilisation and efficiency improvement measures that Krones continued to implement in the reporting year, Krones' profitability improved significantly in 2021. Earnings before interest, taxes, depreciation and amortisation (EBITDA) increased from €133.2 million in the previous year to €312.6 million. EBITDA was affected by one-off effects both in 2021 and in the previous year. In 2020, restructuring charges impacted earnings by around €72 million. EBITDA in 2021 contained a net positive impact from one-off effects in the amount of around €17 million. Adjusted for the one-off effects in each of the two years, the EBITDA margin improved from 6.2% in the previous year to 8.1% in 2021. Krones consequently reached the upper end of the upgraded EBITDA margin target of 7% to 8% published in July 2021. Excluding the one-off effects on earnings, the EBITDA margin was 8.6% in the reporting year (previous year: 4.0%).

Earnings before taxes (EBT) climbed from €-36.6 million in the previous year to €177.3 million in 2021. This corresponds to an EBT margin of 4.9% (previous year: -1.1%). Adjusted for one-off effects on earnings, the EBT margin was 4.4% (previous year: 1.3%). Krones generated consolidated net income of €141.4 million in 2021 (previous year: consolidated net loss of €79.7 million). Earnings per share improved to €4.47 (previous year: €-2.52).

Both segments generated high earnings growth in 2021 - Intralogistics is Krones' third segment from the beginning of 2022

In both of Krones' segments, rising revenue and the strategic measures had a positive impact on profitability in 2021. In the core segment, Machines and Lines for Product Filling and Decoration, on the basis of 8.9% higher revenue (€3,045.6 million), EBITDA improved by 65.1% to €283.2 million (previous year: €171.5 million). The EBITDA margin rose to 9.3% (previous year: 6.1%).

The Machines and Lines for Beverage Production/Process Technology segment returned to significantly positive figures in 2021. Both process technology and intralogistics contributed here. Total segment revenue went up by 12.1% to €588.9 million, with Intralogistics growing even more strongly. Segment EBITDA improved substantially from a negative €38.3 million in the previous year to a positive €29.4 million. The EBITDA margin was 5.0% (previous year: -7.3%).

Intralogistics is a separate segment from the beginning of 2022. Krones will thus report on three segments in future. This is primarily because the Intralogistics business has attained a commensurate size as a result of the strong growth in the last few years. In 2021, Intralogistics revenue was €292 million, 40% higher than in 2020.

Krones generated free cash flow of €203 million in 2021 and had net cash of €378 million at the end of 2021

Krones' free cash flow of €203.3 million in 2021 was only slightly down on the very high figure from the previous year (€221.3 million). The company significantly improved the working capital to revenue ratio to 24.8% (previous year: 28.3%). The level reached is thus better than the target corridor of 26% to 27%. At €378.3 million, Krones' net cash (cash and cash equivalents less bank debt) was significantly higher at the end of 2021 than a year earlier (€184.9 million). The equity ratio was 39.8% (previous year: 39.4%).

With the above figures, Krones has confirmed the preliminary figures published on 24 February 2022.

Krones plans to pay a dividend of €1.40 per share for 2021

Krones' long-term dividend policy is to pay out 25% to 30% of consolidated net income to shareholders. At the Annual General Meeting on 31 May 2022, the Executive Board and Supervisory Board will be proposing a dividend of €1.40 per share for the successful 2021 financial year. In the previous year, due to the pandemic-related loss, Krones paid the statutory minimum dividend of €0.06 per share.

Krones provides guidance for the 2022 financial year

Krones made a strong start to the 2022 financial year with a very large order backlog. At the same time, various uncertainties mean that the business environment remains challenging for Krones. Above all, it is not currently possible to predict how the war in Ukraine will develop and how its consequences will impact the global economy. Material shortages and problems in global supply chains as well as strong inflation in many countries additionally present risks for the entire economy and also for Krones. It is also uncertain how the Covid-19 pandemic will continue to play out around the world.

For the full year 2022, based on the prevailing macroeconomic outlook and the current expected development of the markets relevant to Krones, the Executive Board forecasts revenue growth of 5% to 8% with an improved EBITDA margin of 8% to 9%. From 2022 onwards, return on capital employed (ROCE) replaces the working capital to revenue ratio as Krones' third key performance indicator. The target for ROCE in 2022 is 10% to 12% (2021: 10.0%).

Krones has published the Annual Report 2021 online at:
https://www.krones.com/en/company/investor-relations/krones-group-annual-report-2021.php

Krones also published its Non-financial Report 2021 today. This contains the main non-financial information on the key sustainability topics that are material to the company. The Non-financial Report 2021 is available online at:
https://www.krones.com/media/downloads/KRONES_NFB2021_e.pdf

Contact:

Olaf Scholz

Head of Investor Relations, Krones AG

Tel.: +49 9401 70-1169

E-mail: [email protected]