Knorr-Bremse publishes preliminary results for the second quarter of 2024 and raises guidance

Knorr-Bremse publishes preliminary results for the second quarter of 2024 and raises guidance

Munich, July 29, 2024 – Knorr-Bremse AG, global market leader for braking systems and leading Commercial Vehicle Systems and Rail Vehicle Systems supplier, expects the following preliminary key financial figures for the reporting period April to June 2024 for the Group:

• Order intake amounts to €2.1 billion and the order backlog – adjusted for Kiepe Electric – remains at a high level of €6.8 billion
• Sales revenue amounts to around €2.01 billion
• The operating EBIT raises by 13% to approximately €252 million. The operating EBIT margin is around 12.5% (Q2/23: 11.1%)
• Free cash flow quadruples compared to prior-year quarter and amounts to around €158 million (Q2/23: €34 million)
• Earnings per share increase to €0.90
• Full-year guidance for 2024 raised

The preliminary key financial figures for Q2/24 partly exceed analysts’ expectations and confirm an overall positive business performance in the second quarter.

Marc Llistosella, Chief Executive Officer (CEO) of Knorr-Bremse AG: “Thanks to a strong team effort, we have achieved an excellent interim result for the first half of the year. Our ‘BOOST 2026’ strategy program has already had a positive impact on our sales revenues and has reduced costs. Our fix-it-or-sell-it program, in which we are putting units with a total sales revenue volume of €1.4 billion to the test, is making an important contribution here. At the same time, we are expanding our business activities as demonstrated by the attractive acquisition of Alstom Signaling in the USA.”

Frank Weber, Chief Financial Officer (CFO) of Knorr-Bremse AG: “According to preliminary results, we performed better than expected in the second quarter of 2024 across most of our key financial figures. We are particularly pleased with the fact that our cost and efficiency measures have already achieved around 50% of the profitability improvement targets defined by the ‘BOOST 2026’ strategy. A comparison over the last three years shows the steady increase in the operating EBIT margin from 10.5% in Q2/22 to 11.1% in Q2/23 and to currently 12.5% in Q2/24. We are therefore raising our guidance for the operating EBIT margin.”

Earnings per share significantly improved on the previous year’s quarter due to the strong operating result and the BOOST 2026 efficiency program’s success to €0.90. This applies despite the following one-off effects, which burdened earnings in Q2/24 by around €0.13 per share:

• Significantly more positive development of Cojali since acquisition, in which the Cojali minority shareholders also participate accordingly.
• Impairment of a business unit in the CVS division in the context of the intended sale of this unit.

The guidance for the operating EBIT margin for 2024 is being raised mainly due to the following factors:

With the “BOOST 2026” strategy update the Executive Board has launched a large number of measures and initiatives, including an effective cost and efficiency program. These measures are beginning to bear fruit and are having a positive effect on Knorr-Bremse’s development.

Based on the preliminary key financial figures for the first half of 2024 and despite the expected development of the Truck market in the second half of the year, the Executive Board is slightly raising the guidance for the 2024 financial year.

Knorr-Bremse AG continues to expect sales revenue of between €7,700 million and €8,100 million, an operating EBIT margin of now between 11.5% and 13.0% (previously 11.5% to 12.5%) and an unchanged free cash flow of between €550 million and €650 million. This guidance does not take into account the acquisition of the rail signalling technology business of Alstom in North America, which has yet to be completed.

The full half-year report for 2024 will be published as scheduled on August 8^th, 2024.

Notes to and reconciliations with the financial indicators used can be found in the 2023 Annual Report of Knorr-Bremse AG (available under Annual Report 2023).

Media Contacts:

Claudia Züchner, Spokeswoman, Financial Communications

Phone: +49 89 3547 2582, e-mail: claudia.zuechner@knorr-bremse.com

Investor Relations:

Andreas Spitzauer, Head of Investor Relations

Phone: +49 89 3547 182310, e-mail: andreas.spitzauer@knorr-bremse.com 

About Knorr-Bremse

Knorr-Bremse (ISIN: DE000KBX1006, ticker symbol: KBX) is the global market and technology leader for braking systems and a leading provider of other rail and commercial vehicle systems. Knorr-Bremse’s products make a decisive contribution to greater safety and energy efficiency on rail tracks and roads around the world. 33,000 employees at over 100 locations in some 30 countries develop and produce innovative solutions and services that meet the highest technological standards. In 2023, Knorr-Bremse’s two divisions together generated revenues of approximately € 7.9 billion. For almost 120 years, the company has been at the cutting edge of its industries, driving innovation in mobility and transportation technologies with a leading edge in connected system solutions. Knorr-Bremse is one of Germany’s most successful industrial companies and profits from the key global megatrends: urbanization, sustainability, digitalization, and mobility.

DISCLAIMER

This publication has been independently prepared by Knorr-Bremse AG. It may contain forward-looking statements which address key issues such as strategy, future financial results, events, competitive positions, and product developments. These forward-looking statements – like any business activity in a global environment – are always associated with uncertainty. They are subject to a number of risks, uncertainties, and other factors, including, but not limited to, those described in Knorr-Bremse’s disclosures. Should one or more of these risks, uncertainties or other factors materialize, or should underlying expectations not occur or should assumptions prove incorrect, the actual results, performances, or achievements of Knorr-Bremse may vary materially from those described in the relevant forward-looking statements. Such forward-looking statements may be identified by words such as “expect,” “want,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “estimate,” “will,” “project” or words of similar meaning. Knorr-Bremse does not intend, nor does it assume any obligation, to update or revise its forward-looking statements regularly in light of developments which differ from those anticipated.

This publication may include supplemental financial measures – not clearly defined in the applicable financial reporting framework – that are or may be alternative performance measures (non-GAAP measures). Knorr-Bremse’s financial position, financial performance, and cash flows should not be assessed solely on the basis of these alternative supplemental financial measures. Under no circumstances do they replace the performance indicators presented in the consolidated financial statements and calculated in accordance with the applicable financial reporting framework. The calculation by other companies that report or describe similarly titled alternative performance measures may vary despite the use of the same or similar terminology.