KBX.DE
Annual Report 2023
Profile
Knorr Bremse is the global market and technology leader for braking systems and a leading supplier of other rail and commercial vehicle systems. For roughly 120 years, we have driven sustainable innovation and connected system solutions. Our products make a crucial contribution to greater safety, efficiency, and reliability on rail and road. Knorr Bremse focuses its innovation on pioneering transportation solutions that build on global megatrends such as urbanization, sustainability, digitalization, and mobility. These concepts are shaping the global transformation within the transportation sector and offer enticing prospects for long-term growth in the rail and commercial vehicle segments.
We are proud of our
33,000
employees
at over
100
locations
in more than
30
countries
Key performance indicators
Revenues
EBIT
EBIT margin
EBIT operative
EBIT margin operative
EBT
EBT margin
Net income
Return on sales after tax
Earnings per share
Incoming orders
Order book (31.12.)
Free Cash Flow
Operating Cash flow
Capital expenditure
Capital expenditure in % of sales
R&D costs
R&D costs in % of sales
Total assets*
Equity*
Equity ratio*
ROCE*
Net Working Capital*
Knorr-Bremse share
Number of shares
Dividend per share
Employees
* adjusted in 2022
Rail
vehicle systems
Revenues
EBIT
EBIT margin
EBIT operative
EBIT margin operative
Capital expenditure
R&D costs
R&D costs in % of sales
Employees
Commercial vehicle systems
Revenues
EBIT
EBIT margin
EBIT operative
EBIT margin operative
Capital expenditure
R&D costs
R&D costs in % of sales
Employees
In € million
In € million
%
In € million
%
In € million
%
In € million
%
€
In € million
In € million
In € million
In € million
In € million
%
In € million
%
In € million
In € million
%
%
days' sales
€
In € million
In € million
%
In € million
%
In € million
In € million
%
In € million
In € million
%
In € million
%
In € million
In € million
%
2023
7,925.6
869.9
11.0
893.1
11.3
772.8
9.8
576.2
7.3
3.43
8,252.2
7,082.3
551.7
914.6
368.5
4.6
544.1
6.9
8,248.6
2,903.5
35.2
19.5
51.4
161,200,000
1.64
33,319
2023
3,747.5
531.9
14.2
535.6
14.3
116.4
238.1
6.4
17,284
2023
4,180.2
398.0
9.5
417.5
10.0
240.6
306.0
7.3
15,027
2022
+ / -
7,149.7
+10.9 %
3.03+13.3 %
8,114.1
+1.7 %
6,907.5
+2.5 %
219.3 +151.6 %
541.6+68.9 %
8,141.6
+1.3 %
2,628.0
+10.5 %
32.3
16.4
55.9-4.5
161,200,000
1.45+13.1 %
31,599
+5.4 %
2022
+ / -
3,401.9
+10.2 %
108.0+7.8 %
16,370
+5.6 %
2022
+ / -
3,750.0
+11.5 %
223.6+7.6 %
14,284
+5.2 %
Contents
01
To Our Shareholders
06
Letter from the CEO
11
The Executive Board
12
Report of the Supervisory Board
26
The Supervisory Board
02
Combined Management Report
30
About the Group
38
Further Details of Corporate Governance
42
Sustainability and Non-financial Statement
74
Business Report
87
Supplementary Report
87
Report on Risks, Opportunities, and Expected Developments
99
Knorr-Bremse AG (HGB)
101
Assurance Report of the Independent Auditor
03
Consolidated Financial Statements
106
Consolidated Statement of Income
107
Consolidated Statement of Comprehensive Income
108
Consolidated Balance Sheet
110
Consolidated Statement of Cash Flows
112
Consolidated Statement of Changes in Equity
114
Notes to the Consolidated Financial Statements
203
Responsibility Statement
204
Independent Auditor's Report
04
Compensation Report
216
Introduction
216
Overview of the Fiscal Year
217
Executive Board Compensation
232
Supervisory Board Compensation
235
Multi-year overview
238
Report on the audit of the remunaration report
04
K N O R R - B R E M S E A N N U A L R E P O R T 2 0 2 3
K N O R R - B R E M S E A N N U A L R E P O R T 2 0 2 3
T O O U R S H A R E H O L D E R S
05
To Our Shareholders
01
06
Letter from the CEO
11
The Executive Board
12
Report of the Supervisory Board
26
The Supervisory Board
06
K N O R R - B R E M S E A N N U A L R E P O R T 2 0 2 3
L E T T E R F R O M T H E C E O
Letter from the CEO
2023 was another tough year for business - but it was also a record year for Knorr-Bremse. And so, before I report on the performance of our Company over the past year, on behalf of all Executive Board members I would like to begin by saying a big thank you: Thank you, my dear colleagues, for your magnificent effort and for the deep commitment you demonstrated yet again over the past year. We all know that record results don't just appear out of the blue. They come from hard work. This is down to you - and all of us at Knorr-Bremse are proud of it.
In the past year the general economic situation showed very little material improvement: The global economy remained under massive pressure. The brutal war waged by Russia against Ukraine, geopolitical tensions, persistently high energy prices and only a gradual decline in inflation - all these factors exerted pressure on our business.
Despite these global challenges, however, Knorr-Bremse achieved all of its ambitious goals. One of the most important achievements was this: We improved our profitability. This was particularly underpinned by our earnings optimization program and our cost discipline. And so we demonstrated once again: Knorr-Bremse can conquer a crisis. This strong resilience is reflected in all our results: Our order books and order intake as well as our revenues reached new records.
Expressed in figures, this means: Knorr-Bremse's revenues in the full year 2023 rose by 10.9% to around € 7.9 billion. Both divisions contributed equally to these positive developments. Thanks to persistently high customer demand, the order intake rose by 1.7% to a new high of € 8.3 billion. With a 2.5% increase to around € 7.1 billion at the year-end the order book recorded a new all-time high as well.
Profitability also improved through the cross-divisional Profit & Cash Protection Program (PCPP) - as part of our strategy program "BOOST 2026" - in particular: The operating EBIT margin reached a value of 11.3%. The rise in free cash flow to a level above € 552 million also demonstrates the positive effects of the entrepreneurial countermeasures we have already implemented.
K N O R R - B R E M S E A N N U A L R E P O R T 2 0 2 3
L E T T E R F R O M T H E C E O
07
Our BOOST program is clearly aligned to unlocking value - all our initiatives aim to increase the value of Knorr-Bremse: Our profitability has top priority.
- Marc Llistosella, CEO
With these results we met our outlook for the 2023 fiscal year in full. In view of this performance the Executive Board and Supervisory Board will propose to the Annual General Meeting that a dividend of € 1.64 per share be paid.
The prerequisite for such a first-class performance is the trust our customers place in us as a global market and technology leader. This marked confidence our customers display in the quality of our products and services is evidenced by the very clear successes of our two divisions: Thus our RVS (Rail Vehicle Systems) division successfully signed major international contracts with large vehicle manufacturers. Among other things, Knorr-Bremse will be fitting out a total of 52 metrotrains comprising a total of 156 cars in the Indian cities of Bhopal and Indore with braking and air conditioning systems in a partnership with Alstom and providing comprehensive service over a period of 15 years. An order from the world's largest train manufacturer CRRC (China) and a multi-system order for Hitachi Rail in Italy - which includes our new passenger train coupling systems - are among the further highlights.
08
K N O R R - B R E M S E A N N U A L R E P O R T 2 0 2 3
L E T T E R F R O M T H E C E O
We underscored our innovative strength in the CVS (Commercial Vehicle Systems) division with the further development of a number of important products and solutions in 2023, including the iTEBS X system, for example. At the end of last year, Knorr-Bremse commenced mass deliveries of the new-generation intelligent electronic trailer braking system. The successful "eCUBATOR" innovation unit was extended beyond 2023 with an expanded target
In addition to these operational successes, both divisions completed price negotiations successfully, thereby reducing the inflation-related effects on our earnings. We cannot overestimate this success nor the trust of our customers. For us as one of the major suppliers of components in both the rail and the truck industry, such price negotiations go to the core of our economic viability.
Demand in the rail vehicle market was robust in all regions. In the 2023 fiscal year the RVS division significantly increased its revenues to approximately € 3.7 billion. Due to economies of scale, the efficiency measures implemented, the pricing measures mentioned earlier, and an improved share of aftermarket revenue, the operating EBIT margin reached 14.3%. Demand in the global commercial vehicle market was also at a good level in the previous year. With a rise in revenues to around € 4.2 billion the division achieved another strong result in the 2023 fiscal year. The division's profitability was very positive with an operating EBIT margin of 10.0%.
In future, we aim to bring the aftermarket, data-driven solutions and the performance in fast- growing markets such as India even more into focus. The rising demand for rolling stock as well as the urgently needed digitalization of the railways are opening up further potential for growth for us in aftermarket business. Thanks to the very good collaboration with our subsidiary Cojali we are also clearly expanding our core business in the field of digitalization in the truck segment and accessing a wider group of customers with new service solutions. A strong trend toward urbanization and the associated infrastructure investments make India one of the most attractive markets of the future where Knorr-Bremse is seeking to generate profitable growth, in both divisions.
Disclaimer
Knorr-Bremse AG published this content on 21 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 21 March 2024 14:45:01 UTC.