KION GROUP AG (KGX) Earnings Call Transcript & Summary

Good morning. And welcome to KION's Capital Markets Day 2020. My name is Antje Kelbert and together with my Investor Relations colleague, Dana Unger we welcome you this morning. And thank you for your interest in KION.

Good morning. Before we start, some housekeeping words from our side. Safety is important to KION. So therefore, please take note of the emergency exits with the green exit signs on the left and right-hand side of the room, as well as in the rear. Additionally, please be so kind and put your mobile devices on mute. Since we broadcast today's event, there are several cameras focusing on our speakers today to facilitate the live stream. And last but not least, the disclaimer behind me applies to the whole presentation for today. And with this, let's start right away. [Presentation]

Yes, we do. Thank you today to come to this Capital Markets Day 2020. Welcome personally. We very much appreciate that you took the time to come to us today despite all the coronavirus discussions. Also, welcome to those that are with us today via webcast. Leading the industry, that is the title of today's Capital Markets Day. And KION is the leading player in this industry. Why do I say that? Well, first of all, number one, we've delivered, again, another very strong year with our full year 2019. Secondly, we operate in a very attractive market. Third, the unique combination, supply chain solutions and industrial trucks allows us to shape the future for today and tomorrow. And fourthly, we do have the financial strength to make strategic investments in the future to secure the future. And today, we will discuss these with you and give you more information on these investments. But as always, it always starts with people, and I'd like to introduce right now my team and the team that's with me today starting here, Anke Groth, our CFO; Andreas Krinninger, the Head of Linde EMEA; CP Quek, KION Asia Pacific; Hasan Dandashly, Head of Dematic; and Eike Böhm, our CFO -- CTO; CFO, is not yet, but he's really good with the numbers. Okay. Yes, let's get started with the presentation. We have a full day agenda for you today. But I'm sure that it will be very interesting material that we can present, and we have enough time also for dialogue with each other. I'd like to start with the strategic update. In a simple word, we have delivered. We have created significant value. And if you look at KION during the past years, since the IPO, we have grown revenues 6.6%, almost 7% annually. We've delivered profits 8% annually. And at the end of the day, 180% shareholder return. Now that strong return beats our index, European capital goods and material handling peers without a doubt. So in a nutshell, since the IPO, KION truly has created value. But how have we done this? Since the IPO in 2013, we have strongly deleveraged the company. We made a transformational acquisition by bringing Dematic into the family in 2016, and this led to our unique ability to deliver logistic solutions. After that, we set up the KION 2027 strategy and defined our strategic fields of action, namely energy, automation, digital, innovation and performance. And earlier this year, in January, we put out a tremendous full year 2019 numbers because we had such a great finish in the fourth quarter of last year. But of course, it doesn't stop there. The journey continues, the journey of creating value. We are making substantial strategic investments this year, investments to keep the momentum going for growth, to become more global and in innovation -- in innovating and investing in our core. This will allow us -- these investments will allow us to continue to shape material handling industry, as we have done in the past. But of course, and that will be a focus of today's Capital Markets Day, we have our eyes on costs, our focus on performance and we have rolled out a group-wide efficiency program. And we will use this Capital Markets Day today to dive deeper into all of the topics on our global setup, innovation and efficiency. But to set the scene, I'd like to talk a little bit about the attractiveness of our market. If you look at the global trends around us, and we notice that every day in our personal lives, these do strongly drive the material handling industry growth that we've seen in the past years and the growth that we anticipate in the years to come. Just take e-commerce. We all know it, everyone receives packages, maybe not daily, but often. This is driving the business, drives the need for automated solutions. Otherwise, you can't have such a span of e-commerce available. This is expected to grow by 14% through the coming years. Urbanization. Cities are becoming more dense. Population in cities is growing, and this drives the need for things like micro fulfillment, a very interesting technology that you'll get an update on today. 58% growth is expected in the coming years. Digitalization affects all of us, especially in times like these, how to communicate with each other, but big data, big data increases, drives the need for connected vehicles, all pieces in a warehouse, speaking with each other, and this market is expected to grow by 54% in the coming years. And last but certainly not least, sustainability, customers are asking for green supply chains. This drives the need for electric trucks. KION is the largest supplier of electric trucks in the world. And lithium-ion battery powered trucks are expected to grow by 42% until 2027. So these trends do drive the changes in our industry. And the path that our industry is on right now is towards what we call lights-out warehouse. Yesterday, we offered forklift trucks, driver assistance, fleet data management programs for all of our trucks. Today, we're concentrating more and more on new energy sources, sustainable products, micro fulfillment. And more and more, we are offering autonomous vehicles, software and connected solutions. And our industries do need to tackle these technologies, data analytics to enable lights-out warehouse. In a large part of the warehouses, especially our big e-commerce pure-play players, in their warehouses of the future, they will be entirely dark and fully automated every day. So as a leading player in this very innovative business, KION is uniquely positioned to capture the growth opportunities in our industry. But how do the mega trends translate into demand for material handling solutions? Let's take a look at that here. We expect that the growth in this market is a longer-term market growth that the total addressable market will be for material handling solutions, if I break it down in trucks or industrial trucks, of around 4% CAGR through the next several years until 2027 and even double that growth, so 8% for automation solutions, so this is really a great market to be in, a market that is truly growing year-to-year. If we take a look at the regional development that's -- this growth is not specific to one country or one region. If you look at the 6% growth in Europe, Americas, and particularly in Asia, and particularly China, growing ahead of this market all around the world, material handling solutions are being asked for. And we as KION with our global setup are the one that will truly be able to capitalize because of this broad global setup. Now let's take a look at the market development by technology and customer needs. Look at the left side of this chart, E-Trucks and on the right side, the e-commerce, which strongly contribute to global growth. In industrial trucks, we will be seeing a continued substantial shift away from internal combustion-driven trucks to sustainable electric forklift trucks. This is driven on the one hand, certainly, by the emissions requirements and the demand for sustainable products but on the other hand, the technical advancement that we've seen in the last couple of years. For lithium-ion battery packs, you have an electric truck that has almost the same performance, and in many cases, a better performance than an engine-driven truck. We will see this all over the world not just in Europe, but particularly in China, making the biggest effort here to convert to electric-powered vehicles. In automation systems, we will see strong growth in e-commerce automation being driven by online demand but also omni-channel fulfillment regardless of industry, so it's not just a pure-play e-commerce, every industry is affected by this trend. And KION will benefit from this trend. If we look at how has KION changed since the IPO, and even since the last crisis 2009, we have become much less cyclical and more global. We have substantially grown what we call our noncyclical revenue, and we consider noncyclical revenue, the revenue of SCS because it's driven by longer-term strategic decisions but also the service business and industrial trucks, which is triggered by an ever-growing installed base, this leads to almost 70% of our future revenue being noncyclical. So KION is a very different company than it was several years ago, a much more noncyclical company. And we've also broadened our geographic setup. If we look at the acquisition of Dematic, we significantly strengthened our Americas footprint. And with our strategic investment into China, we will also, again, grow our already strong presence in Asia Pacific. And we have defined a very comprehensive growth strategy for China. China is the single largest forklift market in the world and still growing rapidly. We, as KION, are the #3 in the market and by far the #1 OEM that is nondomestic, and we have been in China a long time, a quarter of a century. We know China. And our growth plan includes the development of new products, the expansion of our local sales and service network and a new industrial truck plant. We will take advantage of the growth opportunities that the value segment in this market has and the ever-increasing demand for electric-driven industrial trucks. And to assure the -- to ensure the capacity that we need in this market, we've made a decision to erect a new state of the art plant in Jinan in East China to manufacture these counterbalance trucks. And for this purpose, we formed a joint venture with our anchor investor Weichai Power. And on this joint venture, KION has 95% of the shares. The investment volume will be around EUR 100 million in the new manufacturing plant for the industrial trucks, the Linde trucks and Baoli trucks that we will build there. We will have an R&D center and a training center. The construction of the plant will begin already this year, so 2020, and we will make steps to ramp-up the production to full speed by the year 2022, so a rather aggressive investment program. So we are truly increasing our capacity in this -- for KION, very important market, and CP will dive deeper into the details later today. The new factory in Jinan will truly broaden our global footprint. And we talk about global footprints, especially in the last couple of years, despite -- or as a result of trade wars. And even now with the coronavirus, the global footprint that KION has today is a real differentiator in the market. We've formed a strategy several years ago to be local, to be close to the customers, R&D, production, sales and service, everything we need in those local regions, including supplier networks. And so, we significantly streamlined our IT&S production footprint in Europe, following the financial crisis, and we even closed several facilities in U.K. and Italy, France and Germany and then invested into new facilities in Eastern Europe, the Czech Republic, China and our Polish factory is currently right now as we speak, under construction. But we didn't stop with just factories. In addition to the investments that we've made in our footprint, we've heavily invested in new technology to maintain and extend our leading position. If you look at this chart, clearly, KION is the leader in our industry. We're #2 in the forklift market, #1 in automation systems, but the true value that we can offer our customers is the combination of the 2, the unique offering that we can have for our intralogistics customers. And we've achieved a lot of this through our strong focus on leading innovative products and services. Innovation is the core of our company. We've always had a strong drive towards innovation focused on our customers. This allows us in many regards, I believe, to also shape the industry and shape standards in the industry. At IT&S, we have recently launched a new counterbalance truck generation for Linde and for STILL. This doesn't happen every day. This happens every 10 to 15 years. All are available with lithium-ion battery packs, and they are fully connected to the Internet as a standard. Mobile automation, also a very key driver towards lights-out warehouse, offering bespoke and series trucks, automated guided vehicles. These are just the first step to enable us, to enable our customers to move to really lights-out warehouse. And this is a shared technology between the 2 segments, SCS and IT&S. In SCS, we've continued to strengthen our customer-specific expertise. We've developed vertical solutions for all the verticals. One of the recent new technologies, micro fulfillment and e-commerce returns handling with our robotics center. We're also driving the robotic picking because that is also a prerequisite to be able to drive lights-out warehouses. And our innovations benefit also from the increased connectivity between all of the items through digitalization. Digitalization is a topic that is transforming our industry, our company, and we are driving very much forward to transform the KION Group. It's one of our strategic fields of actions for the KION 2027 strategy. I'm personally responsible to drive this transformation through the KION Group. And as we improve our internal processes, our offerings to customers, the customer journey touch points as well as new business and new business models that we can then monetize as we exercise this and execute it, it will change the way we do business. A prominent example that's happening right now today is in the area of Industrial Trucks. With the launch of the new product, we have now a truck in the field that has a so-called digital twin. Digital twin, what can you do with a digital twin? You can make a software update. You can put a new function in the forklift. You can do predictive maintenance. You can change the performance of the truck through the cycle of its usage. You equip the truck to have new options that you may not even know about today that may come in 2 years from today. The only other product that I know that works that well is a Tesla car. And Linde has the Tesla of the forklift industry. In addition to that, we can offer new services, preventive maintenance. We can take advantage of remote diagnostics, which helps reduce the cost to our customer. In automation systems, we have a new emulation and simulation platform that makes it able to the customer to visualize, to actually see operational aspects of the entire warehouse in real time. The validation of the system becomes much, much easier than it was before. And at lunch time, please take the opportunity, we will have a demo of our Dematic IQ virtual. Take the time to speak with some of our experts of how this works and the great opportunities that digitalization brings to our industry. In our continued drive to deliver digital, we are also proud that we are able to strengthen the software offering of SCS. A couple of days ago, after a lot of work by a lot of people in this room, we acquired 100% of Digital Applications International. DAI is Dematic's long-standing partner based in the U.K., and it offers logistics, automation software. It generates revenue of approximately 40 million, and we have 240 employees, most of whom are software engineers. And with DAI, Dematic is significantly expanding its digital offering, which supports the movement, the storage and distribution of goods across the entire supply chain. But not only that, we have software as a solution, but we're also adding on or the possibility to add on existing or new entry point for new Dematic customers, while DAI customers can become also new Dematic customers. And Hasan will provide a lot more detail to this point in his presentation later today. A topic that affects all of us in everything we do and something that KION as a group many years ago, before FridaysForFuture, in the early days has been committed to and that is sustainability, in our products, towards our customers and within the group. And we are making substantial significant progress in this important field. We serve as an enabler, a true enabler for our customers to have green supply chains. We enable green material handling for our customers with something like electric trucks. Today, already 86% of all of our order intake products are electric, already today. And we expect this trend to significantly increase in the future, and we act sustainably. Our activities and reporting have been increasingly have been recognized. We've scored very well in several independent markings, rankings and publications with our sustainable strategy, and we will continue to be ahead of the curve on this. Because innovation, sustainability is reflected in our R&D spend every day. As I talked about innovation being at the core of KION and the need to continue to innovate, we are strongly committed to our R&D, and we will increase this R&D spend in this year in our focus areas. We have continually increased our spend in this area with innovative solutions, being the technology leader in our field. But this year, we intend to up our R&D spend to around 3% of revenue, and we do consider this a heavy investment into our core. This is the highest investment level that we've ever had. And probably, I would assume, among the highest in the industry. But it has a huge payback, and we will demonstrate some of that to you today. We'll be increasing our spend to further support the derivatives of our next-generation trucks, the next-generation platform that we are bringing to the market. And we have increased our budgets to fit to our strategic topics, especially new energy, one topic, the new joint venture for lithium-ion with BMZ, mobile automation, a heavy focus and generally connectivities of digitalization. But while we increase the spend, at the same time, we, in the R&Ds are becoming much more efficient in the use of our resources. If you look at this picture, next level efficiency is a high priority for the entire KION Board. Our Chief Central Technology organization led by Eike, who will present later today, we continue to improve the efficiency of how we do product development. Couple of examples, using modules, using agile methods, implementing common parts, implementing across regions, across brands, platforms to enable us to continuously improve our efficiency and to improve our cost position. So with this, with the R&D efficiency efforts, it's a huge part of our performance excellence program that we established to act as a kind of counterbalance to counterbalance some of the costs that we are investing in our strategic investments. We have a group-wide performance program that we call Performance Excellence, to drive our efficiencies home throughout the entire group. We kicked off the program last year, which I think is great timing. Very good thing that we did it ahead of the curve, and it's aimed at supporting the compensation of cost inflation on the one side, but also capturing additional savings potential and improving -- very important, improving the cost flexibility that we have in the group. A couple of example initiatives are, the productivity improvements in our factories globally, the further savings in indirect purchasing, KION is now a EUR 9 billion. Imagine how much indirect purchasing effort we can save through very structured efforts. And now with the new shared service center for finance, which Anke will talk about, a very important strategic step to flexibilize our costs. So implementing the program targets is a strategic priority for us at the Board, at the KION GEC level. And Anke, as I said, will provide more details on the financial impacts of the program, as we go through the presentation today. Our focus on being more efficient and more effective is a key highlight, I believe, in our investment highlights for the entire group of KION. So let me summarize the highlights in the short and midterm. Again, we operate in great markets. I mean you can have a market to work in, you want to be in a market that's growing. This market is really growing. The second thing is, KION is today already 2020 here in February, a technology leader in all of our fields. We have an increasingly resilient business model. If you look at how we've changed the company over the last 5 years, it's a much more resilient company. We have a clear plan to invest into the future. And at the same time, we have an absolute laser focus on efficiency and profitability. Investment highlights that we'll talk about today support our path towards achieving our midterm targets for profitable growth, and nothing's changed. Some of you know this chart from some of the presentations. And today, we remain as committed as ever to our mid- and long-term targets. With respect to revenue, our EUR 10 million target in the year 2022 to outgrow the material handling industry stays today. We're also targeting the adjusted EBIT margin in the double digit range, in the medium term, and we intend to grow into the range of 10% to 12%. Having said this, I would like to thank you for coming again today personally and so many of you, and we're really looking forward to discussing and presenting our information to you and also later in the Q&A. But right now, I'd like to hand it over to our CFO, Anke Groth. Thank you very much.

Yes. Good morning, again, also from my side. Thank you for coming, and thank you for listening over the webcast. How does the CEO agenda of being more global, focused on innovation, software and digital, the next level of efficiency translate into my agenda? It can be summarized like this. First, we will invest disciplined and focused into our core. Second, we will invest strategically into growth areas. And third, we will relentlessly improve our profitability. These 3 financial actions will secure our leadership position, support how we will continue to shape the industry. Before I provide more details to you, let me tell you why we are confident that we are able to deliver. We have always delivered in each and every year since the IPO, also in times where others have struggled. And 2019 is a great example. Most of you have seen our 2019 financials just 2 days ago. We have a strong revenue growth in IT&S and SCS. And at the same time, we were able to grow our EBIT. We had a slight decrease in IT&S profitability due to the segment mix and higher R&D expenses. Let's leave the past for now and move on to the future. As outlined before, my CFO agenda has 3 priorities: firstly, investing into our core; secondly, investing into growth areas; and thirdly, at the same time, we will clearly focus on our profitability. Let me start with our focused investments into our core. The first pillar is our investment into R&D and the new product launches. R&D is at the core of our capabilities. We are technology leader. Every year, we launch highly innovative products that translate into commercial successes. What is different this year? We have introduced a complete new truck generation, and we do this only every 10 to 15 years. And I can tell you, it's a pretty cool truck. It comes with a digital twin, so this truck is a real game changer. Let's have a look at the financial impact, and the short-term impacts need to be seen in the light of a stable market environment. We will miss volume effects in 2020. So short term, we will see an increased R&D spend expected to be 3% of revenues in 2020. And the product launches and the investments into the machinery lead to higher depreciation. But this new truck generation will enable us to win market share and to sell add-on digital services to our customers. Midterm, we will continue to grow above the market, and the core business will be in the profitability range of 10% to 12%. Let's move on to our lithium-ion joint venture with BMZ, which we announced last year. It will allow us to secure the access to lithium-ion in a cost-optimized way. 2 out of 3 trucks in 2027 will be lithium-ion trucks. Financially, we will invest EUR 15 million this year, and BMZ will be fully consolidated, and therefore, will contribute positively to our EBIT. The third pillar, our Poland plant. It's all about growth, delivered through capacity increase and an improved production footprint in terms of costs and efficiency. We will free up capacity in our Aschaffenburg plant, which will be dedicated to the new truck generation and shift the product from Aschaffenburg to Poland. What does this mean financially? An investment of EUR 80 million and EUR 50 million of that in 2020, additional setup expenses affecting the margin. But the new plant is a fundamental requirement to support our growth and our margin development. Andreas will give you more color on these 3 points as they all belong to the IT&S segment. The last pillar is our investments into IT projects. We drive the harmonization of our IT landscape, and we prepare for S/4HANA as well as investing into RPA, robotics process automation and digitalization of our internal processes. Short term, affecting our margin with higher expenses, midterm, it will pay off with efficiencies. Let me move on to our strategic investments into growth areas. We will further strengthen our segments by investing in China as well as with the acquisition of DAI, a software company. In China, we will invest a total of EUR 100 million for a highly automated plant and EUR 45 million of that in 2020. With this new capacity, new product developments and an improved network through our partnership with Weichai, our net sales will ramp-up by an extra EUR 500 million per annum by 2025, with an attractive margin at IT&S segment level once fully operational. And CP will later on give you more insight into our China strategy. Just 2 days ago, we announced the highly attractive acquisition of DAI. Software capabilities are of paramount importance for SCS and DAI is a longstanding partner of ours. This deal does not only bring 240 very experienced software engineers but also sound financials with attractive software revenues and a double digit margin. And as a CFO, I do like the transaction structure very much because the total investment volume is EUR 120 million but the cash out at signing was only EUR 97 million, and the remaining amount will be out during a 3.5-year period. And while we do invest, we do not take our eyes off our profitability. In fact, our focus on profitability will only increase, and we have a structured performance program to support it. In 2019, we launched a group-wide performance program to achieve scale effects across the group and other efficiency measures. Gordon has taken you through some of the examples, and let me talk about the financial targets we aim to achieve. Firstly, we will mitigate cost inflation. And you can see, this target was already achieved in 2019. Secondly, we are targeting additional cost savings contributing positively to EBIT. And thirdly, we will improve our cost flexibility and our cost structure. Gordon has mentioned shared services. This is indeed a great example from my area of responsibility. We will bundle all European accounting processes in the shared service center located in Poland. All in all, we intend to deliver EUR 150 million gross EBIT uplift in 2021. It will not only compensate headwinds but contribute a EUR 50 million recurring EBIT effect. So let's summarize. We will invest into our core. As explained, we invest into R&D and new products and lithium ion, Poland and IT enablement, with an additional CapEx spend of EUR 65 million and a margin impact. The main effects in here are the higher R&D expenses, accelerated by lower capitalization as well as higher depreciation from the product launches. In the bucket of our strategic investments, China and DAI are included. This sums up to a cash impact in 2020 of EUR 140 million and a minor margin impact. A positive contribution will come from our performance excellence program. So in total, we do see a margin dilution in 2020 of around 0.5 to 0.8 percentage points. Midterm, which is defined as 2022, these mentioned investments will turn into net sales growth and contribute positively to our margin in comparison to 2020. R&D, depreciation and lower capitalization is reaching its peak in 2020 in relative terms. Poland will be finalized this year. In IT projects, we do see the largest increase in spending this year. China will be operational in 2022, and the positive impact of performance excellence is growing over time. Therefore, we are very confident to hit our midterm target. Before I now move on to 2020 and our guidance, let me just share a few words on our corona situation before. Due to the coronavirus outbreak, we are facing several risks, such as infections in our workforce that could lead to closure of production sites as well as sales and service locations. Additionally, global supply chains might be challenging. Chinese GDP is expected to be impacted in 2020, and consequently, we expect a high single digit decline for the IT&S market in China in the full year, whereas the market for supply chain solutions is marked by long-term strategic decisions and, therefore, less cyclical. As of today, we expect that the situation will start to normalize during Q2. What does that mean for KION? Until today, we are not aware of any employee who is infected by the coronavirus. Therefore, all of our plants are running. However, our Chinese plants run slightly below our originally planned capacity, also due to longer and foreseen closures within our supply chain in China. For the first quarter, we assume that top and bottom line will be slightly impacted negative in China, but the catch-up until year-end seems feasible, depending on the further development of the epidemic. We also analyzed the supplier situation in Europe in detail. And as of today, we only see limited risk for our European factories, as we already have started with the implementation of supply chain mitigation efforts. Additionally, we installed a KION-wide task force to be able to assess the overall global risk situation permanently and on a daily basis. As the overall impact as of today is not assessable, we do not consider any effect of coronavirus in our 2020 guidance. Let's move on to the guidance 2020 now, again, which does not take corona into consideration. Our guidance shouldn't surprise you after explaining our focus on investing in our leadership position for the future. IT&S is affected by the investments. We do face a more or less stable-to-slightly declining revenue based on 2019 order intake and expected market development, so we don't have a volume effect. The negative effects from investments and the other spend areas won't be balanced by a positive volume effect. All in all, this is supposed to result in an implicit margin of plus/minus 10%. On the SCS side, we do expect to continue the very positive trend, revenue increase as well as adjusted EBIT. This would result in an implicit margin of plus/minus 9.8%. The KION group development on the next chart is, of course, the result of the 2 segments. So how does this all play together? The investments into our core and growth areas and our performance program will ensure that we achieve our midterm targets. So our midterm targets remain unchanged. We are on the way to achieve group revenues of EUR 10 billion and a profitability of 10% to 12%. As you know, our group generates a significant amount of cash, so let's talk about cash. All the investments will be financed from operating cash flow. EBITDA in 2020 is positively influenced by the higher depreciation. We do expect a cash conversion at the level of 2019, so the point really driving the reduction in free cash flow is CapEx and the DAI acquisition. The business is financially on very sound footing. It's nearly generating cash as we go. And as said, we do finance the investments from the cash we generate, and we have increased dividend year-over-year, now proposing EUR 1.30 to pay out as a dividend to our shareholders. And at the same time, we have deleveraged very nicely, having reached our target of 2x INOD end of fiscal year 2019. So in conclusion, we deliver on our promises, and we have created a highly resilient business model, and we will deliver again in 2020. We are leading the industry with investments into growth areas, new products and new technologies. And we undertake these investments today to ensure we stay at the forefront of the industry and drive our performance. And all of this, in combination with a strong cash flow, a rising dividend and a strong balance sheet. We have created shareholder value in the past, and we will continue to deliver. And with this, we start now our Q&A session, I will ask Antje to come to the stage as well. And please, Gordon, join me again.

Yes. So thank you, Anke. We would like to open it now for your questions. Before we start, please keep in mind to ask only one question at a time. We have sufficient time for all your questions. Before asking your questions, please activate your microphone in front of you, and don't forget to deactivate it afterwards again. And before you ask your first question, please state your name and your company. So it's time for the first question.

Sebastian Growe from Commerzbank. As I'm limited to one question, I focus on China. You said that with the new investments undertaken, you're shooting for incremental revenues of EUR 500 million over time until 2025, that is. Can you give us a bit more color on what product areas you're targeting? And particular here, to what extent will this new truck generation might then also do the trick here? And then what really differentiates you from competition in China in particular? And eventually, sorry, last one, what the general and underlying market growth assumption is at your end?

Yes. First of all, the market in China, our market share, the expectation is to be able to double it -- double the market share in this time. So from, let's say, 7 -- 6%, 7% to over 10%. I would -- I will answer some of the questions, but I would also like to make sure during the session this afternoon, where CP will have a very deep dive into the product setup, factory setup, perhaps it's easier then with a couple of charts and pictures to see it. All I can say that is, it's not just a factory. That's the main thing to take away. We're also making a big step in new product development to fit more closely to the Chinese market, a so-called value market. That's the one big focus. And the other focus is this change that we've seen in the last, I would say, 24, 36 months to move away from engine-driven trucks to electric trucks, powered by lithium, that's a -- let's say, a speed that I haven't seen in any place in the world, probably driven by huge Chinese investments, a lithium-ion on the one side, but also the need for the government to get the emissions down and big standards and that just kind of pushes it to our sweet spot of electric trucks. But for the detail, which products, I really would like to give CP the chance to show that to you in the presentation.

So next question? Please go ahead.

Felicitas Bismarck from Deutsche Bank. In terms of your earnings bridge for the midterm, can you give us your operational leverage assumption on this? And maybe also like shed some light, what -- do you expect to grow more services or new business so that we have more feeling for that? And also, what would do you think is the biggest risk on your midterm earnings outlook?

Yes, let me start with the first question. Thank you, Felicitas. We have outlined in the IT&S segment that we expect it slightly declining to stable revenue situation. And we have a lower order book at the beginning of the year. And for services, we do expect to grow as steady as they have grown in the past. So...

I don't want to interrupt, but I meant for the midterm outlook.

That is also, of course -- I'm talking about 2020, how that plays out. So 2020 will be a year where we see a strong service growth, but the order book for the new business is slightly down in comparison to the year before. And if we look into the future, Gordon has outlined that we expect the market to come back again with growth. So that growth also brings a growth in the new truck segment again. So if we look into the future, so 2020 is really a year where we expect a slightly, as we said, more stable market situation, which has an influence on the order intake for the new truck business. But looking into the future, we expect the market to grow again.

Maybe the second part of the question, the biggest risk, I think that's a very valid question that we ask ourselves every day. Midterm, if you look today, 2020 to '23, '24, that's where we have to execute all these things. We hired into '18, 1,500 people, new. 2019, again, 1,500 new. In 2020, probably a similar level, and that is a real challenge because the type of work we're doing, I said in a media interview on Monday or Tuesday, we are truly becoming more of a software company and a project company. A lot of people, they see our products, this forklift or the conveyor, but what's behind it is really the software and the whole different way of working. And that to us is a challenge. And to get our story across because when young people have a choice today. Sometimes they make a wrong choice and say, I go to a startup company and went up because it's kind of -- but when they come to us and see how we worked it well, are really things and real products. So that's our job is to communicate to get the -- because the fight for talent really is getting tough in this area. So that's what I see is the challenge, the human capital, the people that we need to make these challenging projects work. That's to me the central theme.

Okay. Can I -- just as a clarification, I mean, you're running against new business outperforming services over the midterm. You're running against the regional mix going more to Asia and normally, the margins are a little bit lower. You were running against IC trucks coming down, which tend to have a higher margin over the -- like over the lifetime of the truck again. So how important is operational leverage for you? Or is that all self-made we're going to 10% to 12%?

Yes. No, the operational leverage is an important factor. But maybe a clarification, the electric truck actually is not less profitable. Because if you think about what goes into an electric truck compared to an engine truck, we don't make the diesel engine.

Yes, but due to the service on them, no?

That's right. But our added value to a new generation truck in terms of all the components, electrics, battery, all that stuff, plus the engineering and software that comes with it, will have, as a trend, growing higher. But the operational leverage is really a factor. And if I'm quite honest, in '18, '19 -- little different '18, we had a lot of calls with why all these problems in production. That was quite a disappointing year for me personally because we all have this huge order, and we couldn't get it across. I would call it, negative leverage. Because when you're running at 95% to 110% utilization, you kill all that operational leverage quickly. I mean, I don't know, I think our parts have all deserved at least a senator card that we fly around the world sending parts, getting people. And that was one of the key drivers of our expansion in the Czech Republic, Polish factory, the China is to make sure exactly that as markets grow, we have to be able to run at about 80%, 85% to exactly take advantage of that leverage. Otherwise, there's a negative leverage. To me, that's the challenge, and that's why we are making these investments now because this market, even if it's a little bit flat in 2020, the demand is there. The markets are there. The industry is there that will really bump up the level and that's required to make the 12%. Absolutely correct.

Okay. One last question. I mean, in terms of where your IC truck exposure, it has fallen so dramatically since the IPO in terms of your order composition, right? I would expect this is going to continue like that going forward, at least in Western Europe. But your production at that time at least was very much geared into that. So the question is, how easy is it to transform your capacities from IC truck business, producing an IC truck to producing electric truck.

Yes. That's also one of the key factors of the new truck generation, which Andreas will point to you. This is the first time that we have made on a grand scale, I would call it, a totally flexible production system. So this is not just a new truck generation, nice new truck, it's connected, it's electric. But it's the first time that we can switch engine driven to electric truck and the very same line, the very same people with very same tools. That is unique in the industry. We had to do that because exactly -- I don't know how quickly this change will happen because I heard from a competitor, they're actually exiting out of the engine-driven truck in Europe. Are we going to be the only ones? maybe. But we're equipped with the new assembly system. You can gladly take a look at it in Aschaffenburg, that's able to produce on the same line, same fixture, same tooling, one or the other. That's how many common parts that Ayka has built into this new platform. That's quite a unique advantage.

So Akash, next question please.

It's Akash from JP Morgan. I have several questions. Maybe starting first with Slide #10, where you have long-term outlook where you expect addressable market to grow from EUR 72 billion to EUR 115 billion. The first question I have is that out of this EUR 72 billion addressable market today, how much of this you can address through your existing offering? And for how much you need to partner with somebody or you may not have any solution that you can -- So that's the question number one.

Yes, I would start -- this was on Page 10. The blue part, the forklift part, no one has more service and salespeople in the world than we do. I think we can cover that. On the warehouse development, we have now the broadest portfolio of warehouse products in the world, bar none. With our multi-brand -- we're in every -- so IT&S, we've got it covered. We can handle it. We just got to make sure that we have enough capacity to build these things. That's the only issue. On the yellow part, and Hasan will get into that, we see a market doubling. So when you have a market that's growing 8% to 10% a year, it becomes difficult from the people, but it also becomes difficult to even see all the projects that are available. You told me, I think, why do we see 50% or so in some regions, there's still a lot more potential. So it's really a question, do we increase, ramp-up our speed, do we look at small bolt-on acquisitions like DIA (sic) [ DAI ] to handle the capacity because the market is growing much faster than perhaps our ability in some of the key areas, especially online deliveries to keep up with that growth. So that is a challenge for us to keep up with that, no question.

And then maybe a follow-up on that one. How much of this growth that you expect over -- in the next 8 years to come from current offering or like the products that are already there in the market? And how much of the growth is -- you expect from new solutions like digital twins, like fleet management and optimization or maybe some through IoT application that didn't exist before?

Well, again, looking at the pieces, IT&S, we have all the physical products. And IT&S today is already 50% of the revenue, 49% of the revenues after the sale of the truck. That proportionally will probably go up because of the software offerings. If we can really make it as a software company with monthly rates, monthly contracts, subscription, that's the word I was looking for, I'm not sure. But that part will increase. So again, on the software part, we have it handled. And I think with the ITS, we have all the components we need. On SCS, again, I refer to Hasan's presentation because we are the only ones -- one of the only ones that has all the necessary components. If you look at a warehouse, where we need to upgrade our capability is the software or as Hasan calls the glue to make it intelligent. So that will be the area that we will need to continue to invest on. Everything else, I think, the hardware side we can cover.

And then maybe a question on increase in R&D and investments. So like when you presented 2027 plan, you said there is no need for you to increase R&D and investments, in 2 years down the line we see this and even I see buried in your announcement, the question I have is that how much of this increase in investments in R&D is driven by changing customer needs against what your competitors are doing and maybe some sort of defense to maintain your position?

Very good question. I hate to say things and then afterwards not keep my promises. That's a terrible thing. But the market has changed significantly. And again, Hasan will give you, I think, some very cool examples. Had we not invested in some of the R&D and software products, even though it may be 10% or 15% of the physical order volume of EUR 50 million order and the software part is only EUR 5 million, had we not have the EUR 5 million, no chance, 0 chance to get the order. And that has changed quite a bit in the last couple of years. The connectability of products is a huge change. And the other one that did surprise me in the last 2 years, as we've been getting more and more success, I think today, KION is probably the #1 in mobile automation in the world in terms of vehicles being delivered that, that market would take off so quickly. Again, for us, the biggest challenge, do we have capacity, do we have the people to execute because these orders now come in like 50 packs or 100 packs, and that's a little bit overwhelming at this time. And so we had to increase specifically in mobile automation our spend in 2020, otherwise there's just no way. And if you don't have that piece of it, again, if you don't have that piece of it, you won't get the bigger order.

So perhaps, next question from -- yes.

Yes, it's Sebastian Ubert from SocGen. I would have a question on the 2022 outlook with regards to the margin range of 10% to 12%. Maybe you can shed some light, what is your assumption to get either to the lower end or to reaching the upper end, maybe also some divisional targets that will be quite helpful?

Yes, Sebastian. We do not divide into the segments. It's a target for the KION Group in total. But what will be the differentiating factor between 10% and 12% will be the real growth of the market and, therefore, the volume effect.

[indiscernible] Could you describe probably the margin quality of your SCS order book and the mix in terms of large and small products versus last year. And how would you see the product mix in IT&S new business in 2020? There might be a risk that people tend to go for less options. And therefore, their margin quality could be lower than 1 year ago.

Regarding your first question, throughout the year 2019, we have won quite an amount of large orders. So the shift has mix -- mix has shifted slightly towards larger orders. So we still see small orders. The book of which we call middle-size orders is slightly reduced and then large orders have been increased. But the profitability of those projects is not really depending if it's a small project, middle-sized project or a large project. It really depends on the vertical, on the specific solution we are selling to the customer. It depends on the hardware components of the project. It depends on the software we are putting into such a project. So the size of the project is not driving the profitability. With respect to quality, nevertheless, of the margin on the project business, we also spoke during the year that we are very successful in Central Europe for the business NPI, so the international part of the Dematic business. So we have increased our order intake in Europe and the share between North America and Europe has shifted slightly. And as we also have commented on the margin in Europe is slightly lower than the margin in North America. So that's a slight shift in the overall quality of earnings of the project business, I would say.

The second question regarding the IT&S mix. We have simultaneously going on 2 phenomenons in our industry but especially at KION, sometimes you have luck and sometimes you call it then strategy afterwards. The first one is that the change in warehouse technology, this phenomenon of entry-level warehouse trucks. Years ago, all over the world, there were millions of these hand pallet trucks without engines being manufactured all over the place. Today -- and mostly younger people are in the stores, and they move these parts around. Today a huge part has gone away from a manual hand pallet to hand pallet with a small electric motor and a little lever that the forks move up and down electrically. And that has grown double digit in the last year's EP every quarter. I think thousands and thousands. That's why we invested in EP, and that's why we sell them around the world. So that's the one part of the mix. It's a much lower cost. It's still profitable but it's simply lower. On the other side, what we're seeing is with larger forklift trucks, especially the counterbalance trucks is that the number of options are increasing, which is a challenge for us always, how much do we put in our series production and how much do we kind of take off-line or let our sales and service network dealers and so forth put the options on. So people are using forklifts in many more functions with much more optionality as they did in the past. And if I just think of mobile automation, that's one of the big drivers of the options. We have now made an assembly line in Châtellerault, where it used to be we make the truck. We finish the truck and then we put the mobile automation like the vision, laser and all the stuff afterwards. So you kind of take it apart and put the stuff back in it. Now it's part of the series production. And so what we see is on higher-value trucks that the increase in options or customer options, as we call it, is increasing in total. What does that mean for the mix going forward? The one will counterbalance the other one a little bit, so a lot more small equipment, which is a lower price and lower margins. On the other hand, the upper end, actually becoming more profitable. So I think that will keep its balance. So that at least for the next 2 years, I don't see a huge shift in the mix between the type of products, one compensates the other a bit.

So thank you. I think we have one last question for this first session of Q&A. So perhaps, Philippe? Yes.

Philippe Lorrain from Berenberg. A question here regarding the amount of trucks that you are actually dealing with Chinese partners. Could you give us an indication of how much of your order intake is actually realized with trucks that you don't produce yourself? And also, with regard to the market statistics, to which extent are the market statistics and also order intake statistics from the different players, in our view, not helpful anymore to draw conclusions on the production volumes, and hence, the margin development?

Very good question. Have we ever mentioned that before?

Not really.

Okay. So on the first part of the question, lots of trucks, as also multiple thousands. Let me put it that way. So it is a significant part also for us. And that's why it was necessary, as I said, to invest in Chinese partner with clear contract rules, clear rules of procedure to know what's going on, CP Quek is actually a member of the Board to make sure what is going on with EP. So it is a significant number in units and insignificant number in euros. The which statistic where KION actually has the chairmanship globally for that with our a group of forklift companies around the world. We have lobbied now for almost 1 year within the different associations globally to put this class of entry-level trucks as a special category. We are pretty close to an agreement. I'm surprised who is always opposing these things. Funniest places in the world, sometimes U.S. even, and I'm very confident that at least in '21, we will have quite a bit more transparency on what is entry level and what is the rest because it does make a difference when you talk about the economic impact. It's one thing to have huge numbers, but at $1,500 and $1,200 a truck, it's not the same as a EUR 25,000 electric truck 2.5 tons. So I'm working -- we're all working on it. And I think in '21, when the WITS new statistic comes in, we have a big association meeting in September this year. I think the biggest one is in Hamburg in September, exactly. I hope that we can get this kind of checked off and use it for statistic next year.

So thank you. We close the first round of Q&A. We have another one later on. So I hand back to you, Gordon.

Yes. Thank you all for the great questions. And we're heading towards a lunch break. Now we will have kind of a flying buffet. We have some tables set up for you here. Again, take the time, we have some experts a little back there from Dematic, software experts to show you Virtual iQ, so Dematic Virtual iQ. And we'll see each other in about 45 minutes, that's what we plan to give enough time also to mingle a little bit, and then we will have a great session on our segments and very interesting sessions by Andreas Krinninger, Hasan Dandashly. CP will talk more about China, and Eike give you an update on mobile automation. So let's have interesting lunch together and see you back in 45 minutes. [Break]

Good afternoon. Good to see that you're still all with us after lunch. I hope you enjoyed the lunch and also took advantage of the simulation of iQ. After Gordon, Anke presented the overview of KION selections, KION strategies and the outlook, we will now, in the afternoon, go in the details of the different business segments, and we'll show you how the strategies and financials are anchored in our operational businesses. I have the pleasure to lead you through the KION IT&S segment. My name is Andreas Krinninger. I'm the President of Linde Material Handling EMEA. I'm supporting KION now for 12 years. For 7 years now, I'm a Board member at Linde Material Handling, and for 5 years since inception, I'm also member of the KION global executive committee, so basically, the ladies and gentlemen that sit here in the first row. In my prior roles, I have been an executive in operations. I've been running plants across the globe as well as distribution centers. So in my past, I have used many different material handling equipment. So I have that personal experience, and I bring that customer focus to KION's IT&S business. Why is KION IT&S important? If you just reflect for a few seconds of all the objects that you've touched today, then each of them has been touched by the forks of a forklift at a certain point in time, and that continues to be the case also in the future. And KION IT&S is in the middle of that. We are very well positioned, and therefore, we're very confident that KION IT&S continues to be a highly attractive segment. Now let me, to start, lead you through the 4 highlights of the KION IT&S segment. Therefore, those -- first, attractive markets. The markets we're in continue to grow, and the growth drivers remain intact. And the product and solutions that we offer perfectly fulfill the needs of our customers. Second, technology leadership. We have already the technology leadership today, and we continue to invest in new innovations to enhance the value-add that we bring to our customers. We continuously invest into new product platforms and new solutions, such as safety, energy as well as automation. Third, it's resilient services. Services continue to grow, and we have a full life cycle offering, and we do this all of out of one hand. We capture the full value chain of services. And we utilize digitalization opportunities to, on one hand, enhance our service to customers, ensuring uptime of our products as well as increased efficiency of our own service operations. And fourth, it's efficiency improvement. And if you be aware that the brands of KION to Linde have a history of more than 100 years, then you only become that old if you continuously drive technology leadership for one, but also if you have efficiency improvements as part of your DNA. So we relentlessly drive efficiency across our business model, utilizing things like product modularity, optimize our production footprint and automating our process where we can, just to name a few examples. So overall, 4 key highlights. And in summary, KION IT&S continues to be a highly attractive segment to be in. Now let me narrow in, in each of these 4 highlights, and let me start with attractive markets. Attractive markets, they continue to grow. If you look at the left side of this chart, you see how the market is expected to grow until 2027. We expect an average growth by 4% year-on-year, growing from EUR 40 million to EUR 56 million in terms of value. And this is the total value of the market, including all new business as well as all services. And if you look at the regions, all regions are expected to grow over the next years. First, if you look at EMEA, that's where KION IT&S is a clear market leader in the IT&S segment. This remains the largest segment globally, and we expect a solid growth of 4%. Second, the Americas region, where KION IT&S is in a catch-up position but with an all-new product portfolio as well as an improved sales and service network. There, we also see a solid growth of 4%. And lastly, China, where KION IT&S is positioned as the largest non-Chinese player. We expect even a growth of 5%, and that's why we also have specific measures, such as growing in China where the details will be later on presented by CP. Now this growth in the market is driven by clear market trends and certain customer needs, and let's go in the details of those. Overall, these market trends and customer needs, they remain intact. And the KION answers to that do shape the market overall, but they also address these customer needs. First, our customers are looking for high efficiency. You need to imagine our customers, they are challenged to handle more and more different products, more and more volume in shorter periods of time with less space and less labor available. You can only manage this if you continuously drive efficiency in the operations. And therefore, KION IT&S, we offer highly efficient products, solutions, services to them. Second, it's a need for greater sustainability. All of our customers are eager to reduce the carbon footprint as well as lower the energy cost. We as KION IT&S, on one hand, we offer the cleanest and most fuel-efficient IC trucks. But at the same time, we also have the broadest offering of lithium-ion and fuel-cell equipped trucks in the market. And then on top, we also offer energy consulting to identify the right energy solution for each of our customers based on their needs. Third is increased safety. You can imagine if you handle heavy goods in little space with high speed, there's always a risk of accidents. And therefore, safety and prevention of accidents is a key concern for our customers. And we address this by having the most comprehensive and most sophisticated set of products and safety solutions for our trucks and the environment of the trucks. The answers that we have, they're the result of a very effective innovation process. We continuously invest into understanding our customer pain points, our customer needs. We access latest technologies. We develop minimum value-add products. We bring those to the markets quickly. We test them. And if they're effective, we standardize them and scale them. So everything we develop is a result of very effective innovation approach that we use within KION IT&S. So this is how we address our customer needs continuously going forward. Now let me show how these solution we offer not only address the customer needs, but also drive profitable growth within KION IT&S. And basically, there are 3 pillars that we focus on. The first pillar is technology leadership. We grow above the market in a growing market, and we do so because we offer a differentiated portfolio that drives real bottom line value for our customers. And thus, we satisfy our customers, and we are able to retain our customers. And we're also able to achieve a positive price assertion year-over-year. The second pillar is resilient services. Here, we offer very comprehensive portfolio of services from financing, repairing, maintaining, renting and even selling of used trucks. And for us, this means whenever we put a truck in the market, whenever we sold a truck, then this installed truck, we basically have the opportunity to manage that profit pool throughout the entire life cycle of the truck, from cradle to grave, for up to 15 years. And we also use digitalization to actually enhance the customer experience as well as drive efficiency in internally. And thus, we benefit, on one hand, from the resiliences of service; on the other hand, also from the high margin of this business segment. The third pillar, efficiency improvement. Again, that's something where we continuously relentlessly drive efficiency gains across our business model, also utilizing digitalization and automation of processes. So these are the 3 pillars helping us to drive profitable growth within KION IT&S. Let's now look in more detail in these examples, and I would start with the first pillar of technology leadership. And let me go to the core of our offering, the trucks. And here, we'd like to introduce the 2 new platforms that we just introduced to the market. What you can see here are the 2 all-new counterbalance truck platforms of STILL and Linde, the 2 new crown jewels that STILL and Linde has. And as Anke pointed out, these are really cool trucks. Both are completely new generation of trucks, and these are new platforms that pave a way for the next 10 to 15 years. And therefore, we remain at the forefront of innovation, and we enable best performance for our customers. Let me go into more detail. If you look at the silver orange truck. That's the RX 60 from STILL. It's a new electric-powered truck, and it truly sets new standards in that segment. So far, electric trucks have never had the productivity of IC trucks. But let me quote a magazine, a very well-established magazine in our industry, F+H, that does actually continuous testing of trucks. And let me quote them here. "For the first time in our test history, we have an electric counterbalanced truck with performance values and productivity that exceeds the comparable combustion-engine trucks we tested." So truly innovation here, setting new standards for electric trucks. On the left side, you see the red truck, the Linde H20-H35. We launched this November last year, and it's for sale now, starting January. It's an IC truck, and it's the first model of a whole new product family. And there will be many other trucks following as IC and E on the same platform. As Anke pointed out, this is the first digital truck. It comes with a digital twin. It's 100% connected, which allows many, many functionalities for the customers as well as us. First, it allows easy fleet management. It allows -- we made a remote services. It allows a remote health monitoring, condition monitoring. We can even update software over the air. And we can also switch on and switch off functionalities that a customer may need at a certain point in time. So a lot of new functionalities. And as Gordon pointed out, very similar to what some of you may know in terms of the Tesla of the industrial truck industry. According to our own tests that we've done, the H20-H35 in this IC version allows the highest productivity. Including our test, we showed actually that we were about 10% higher than our competitors. At the same time, we could also show that we have the lowest fuel consumption. So on one hand, you have the highest productivity, lowest fuel consumption. We also consider that to be the most sustainable truck in the industry, and what better time could there be to now introduce that truck. Both the generations of trucks, they will help us to expand our market share in the industrial market segment. And as Anke said, it's necessary to make these investments today to also expand our leading position in the future. Let me now give you an example and showing you a video that kind of introduces some of the features of the new Linde truck. [Presentation]

So again, all new truck generation paving the way for the future. And if you're interested in a test drive, we're happy to invite you to the World of Material Handling taking place in June and May, where you can see the whole portfolio of our IT&S offering for Linde as well as some of the Dematic equipment and others. Overall, completely new set of capabilities, always focusing on driving performance of our customers. So let me switch from driving high efficiency to the increased demand for safety. If you look at German industry, in 2018, they were counting over 36,000 accidents a year involving industrial trucks. That's more than 160 accidents per workday. And all of these accidents, they interrupt the operation of our customers, they damage goods, they damage equipment, they damage infrastructure and some of them even lead to fatal accidents. So safety is a true concern in material handling. But at KION IT&S, we have a great answer to that, how we make sure that we support our customers in reducing the number of accidents and reduces with a structured offering, providing 3 categories. First of all, a structural safety equipment, actually improving the safety on the truck itself. Now imagine for a few seconds, you're in a high bay warehouse. You're in the cabin of your truck, 60 meters up high. You need to pick material out of this warehouse. And now you can imagine any unevenness of the ground floor translates into significant oscillation of your cabin 15 to 60 meters up. And what could happen? You could bounce with that oscillating cabin into the rack, causing accident. Now what we do with our system active stability control, this recognizes any unevenness of the floor and counterbalances oscillation so that the cabin is truly stable. Now you can actually safely pick and you can also drive faster through the aisle. So this solution, one hand, drive safety, avoiding accidents. At the same time, also allows high productivity because it can go at faster speed. And also, it actually reduces the need to actually even out the floor at the warehouse, which is a very expensive undertaking, yes? Second category is surrounding equipment, which are aiming at improving the safety of the work space. Topics like surround view or curve speed control. And the third category, safety assistance systems that look at the overall operations systematically with systems like safety guard, safety vest and even including safety consultancy services. Overall, the customer benefit from that, very clear, you avoid accidents, you avoid cost, you drive higher productivity and you save all the cost for the damages. For KION, a huge benefit because on one hand, we win new customers just with that safety offering. Second, we actually sell higher-specified trucks. There was a question earlier of lower-specified trucks. All that safety equipment actually drives to sell higher-specified trucks because it's so urgent for the customers to avoid accidents. And third, this also offers new doors to our customers. We actually now engage with the safety engineers of the customers to help them improve the situation. And at the same time, they also have a lower price sensitivity when it comes to the choice of equipment. So overall, many, many benefits that we derive for customers as well as for ourselves in driving profitable growth. Now let me show you one example, a video showing our safety guard, safety vest solution. And what you will see here is a solution where we actually equip the truck with sensors as well as the pedestrian with the vest, where you can actually identify a pedestrian behind objects even through walls. And effectively, the system leads to collision avoidance. So let's take a look at that video here, please. [Presentation]

Obviously, so this being an example how we help our customers to make sure they have a safe work environment and how we can contribute that their employees go home safely at night. To just explain this again, you could see there was a visual and acoustic signal for the driver as well as for the pedestrian, and the system actually can recognize pedestrian even behind objects even behind walls, which would -- could never been done before. And the system not only senses visual and acoustic signals, but it also slows down the trucks. It even stops the truck, and thereby, you avoid these collisions. The technology that's used here, ultrawide plan technology, you can also use for other purposes ones like speed zoning, reduces the speed in certain crossings, again to avoid collisions. And this is how we leverage technologies for other purpose. It also helps us in identifying truck locations when they're out in the operations, again, driving efficiency. So overall, we have the broadest set and most sophisticated solutions to help customers improve safety in their operations. With that, let's now switch to greater sustainability, and we've discussed this before, greater sustainability, there's a strong shift taking place from IC to E, and that continues, as you can see on the left side. While the overall market, we said, is growing in value by 4% year-over-year, the share of E-powered driven trucks will actually increase from 64% to 76% globally by 2027. We should not forget, so far, while the share is actually climbing, the volume has been still growing in a -- so it still remains relevant. And as we said before, from a financial perspective, the -- there's no big difference in the margin between IC and E trucks, these are in the new business nor in the after sales. On the right side, you can say -- you can see within the E-powered trucks, there's a significant shift from lead acid to lithium-ion. While in 2019, the share of lithium-ion was about 7%, we expect an increase by 10x to 70% by 2027. And again, here from financial point of view, the absolute gross profit for lithium-ion is quite -- is attractive. It's actually higher due to the higher prices of lithium-ion batteries versus lead acid. At KION IT&S, we're very well positioned to serve that trend. We do have a very broad portfolio of lithium-ion batteries. And according to our own tests, we do have several competitive advantages here. For one, we can faster charge batteries, lithium-ion batteries. We have low operating costs in total, and also, we have a higher temperature tolerance. We can also use lithium-ion batteries in cold store applications. To further strengthen our position in lithium-ion, we founded KION battery systems last year as a joint venture together with BMZ, a very well-established supplier for lithium-ion batteries. This is a 50-50 joint venture for development and production. And there are several benefits that we expect out of that, on one hand, that we broaden our offering even further and that we increase our production capacity, but we also, by this joint venture, secure cell access in a market that's quite tight. We also are able to react faster in the development as well as in the scaling of production capacities. We will also be able to bundle cells, which will give us some sourcing advantages. And lastly, we capture the value of that full chain, which is different. As we discussed before, IC engines, we buy. Lead acid batteries are usually produced by somebody else. Now we also take a step in the value chain for lithium-ion. So overall, an attractive element. This concludes examples now on technology leadership. And let me move on to the second pillar resilient services. Services is very important for us. It plays a very decisive role in establishing value-add to our customers as well as establishing a trustful relationship. And also, obviously, generates the highest margins overall in that business and it serves as a resilient as well as strong growth driver in our segment. And over the past years, we have seen a growth in that segment of almost 6% year-on-year. Our position today in KION IT&S is that we offer the full life cycle, from financing, from servicing the trucks, maintaining, repair from renting trucks as well as from even selling used trucks. So we have the full value chain, different to many other industries that usually do not have that in-house. If we look at the share, the revenue share, over 50% is driven by the aftersales business. Key for aftersales to make sure that we have a high uptime of our trucks. And if there's any breakdown, that we fix this as soon as possible, at best, first time when we approach the truck. We do this by having a very extensive and highly qualified service network. We have more than 18,000 service technicians in EMEA, and thus, we have the best qualified and the most dense service network in the industry. We support our service technicians by in-van delivery of spare parts, so that they can really focus on the service task and those in-van delivery is supplied by multi brand spare part centers that we have that allow for scale in the distribution centers as well as obviously for high parts availability. 30% of the services is made up of rental -- short-term rental. That is always interesting for customer that have seasonal and cyclical businesses. For instance, if you look at farming, harvesting, we have certain harvesting seasons, or if you look at many retailers with the seasonal businesses, they then need to adjust the capacity of the operations. They need to just the number of trucks, and they can always come to us. We have the largest fleet in EMEA with more than 90,000 trucks. So we can always find the best solution for them. Lastly, used trucks. Used trucks are relevant for customers that do expect a high-performing, high-quality, robust truck but they have maybe a lower utilization in their business. And then we can provide them with a robust high-quality truck that we actually refurbish in our own refurbishment centers. So they have a very high-quality standard and we provide them obviously with the same type of aftersales support that we do for new trucks. And for us, this is said many times, also a step in the door for customers to also sell a new truck then afterwards. So overall, service is very interesting. We have the full capture of the value team -- value chain. We support our customers on one hand with high truck uptime, but at the same time, with allowing them to quickly adjust their capacity when needed. And for KION IT&S, you'd imagine we have many, many touch points in that segment, and that every of these touch points we can prove that we are a reliable partner for them, that we're worth being the partner for the future. And each truck once sold, if it's in the market, it's a profit pool for us that we can manage from cradle to grave. And again, that's up to 15 years. Now let me give you some examples how we use digitalization to continuously improve the service to our customer here as well as drive efficiency internally. And here, 3 examples. First, being remote health monitoring on the left. Now with our trucks being connected, we have full visibility of their health condition. We can monitor their operational usage. And thus, we can detect through predictive maintenance, basically, when is there a risk that the truck could come to a stop. And then we could obviously prevent this by doing the right maintenance steps before or schedule repair when it's not affecting the operations of the customers. So that's reducing overall downtime to our customers. The second example is remote technician support. Once our service technician is out there, knowing that the trucks become technically more and more sophisticated, more and more complex, this is a challenge for the service technician on site. You can access your multimedia dialogue, an expert in the back office to help him solve his challenges. And again, that's helping us to improve our first-time fix rate and ensuring that any stoppage remains very short for the customer. Lastly, third example, a digital service app that we offer to our customers, where they can order service through a simple app. They can provide us some information about the truck condition, maybe even take a picture of the truck so that -- so this allows an -- our service technician to be best prepared understanding what he will face here. And he can basically think through what is the right approach to solve that, what is the right number -- the right type of spare parts that he needs to very effectively resolve that in the first time. So digitalization, on one hand, allows us to provide an even better service in today. On the other hand, it improves customer retention and allows for profitable growth for us. Let me now go to the third pillar, efficiency improvement. Several examples here. And again, we drive this relentlessly through our business model. I want to start first with topic that our CTO function, of Eike Böhm, drives forward. The utilization of modules across our product fleet. We've early introduced these 2 new product platforms, and they actually use the same drive axles as well as masts. And once the Linde E-truck version is out in the market, that truck will also use the same battery and connected charges together with the STILL truck. So this is example how the modernization actually helps us to scale innovation across the brands, at least within the region. It also allows us to reduce the R&D effort per truck. It allows us to bundle procurement volume and it also reduces complexity. And over the recent years, we have brought down the number of parts by 50%. You can imagine how that translates into reduced complexity cost in the administrative area. It also helps reduce inventory, and it also helps to improve availability of parts as well as spare parts. Let me now give you another example of how we drive efficiency in our production footprint. And this chart illustrates how our assembly plant footprint has developed over the past years. In 2014, we had 6 assembly plants in EMEA, and they were all in Western Europe. And we only had 1 of those 6 plants being a multi-brand site. Now in 2022, we will have 7 sites with close to 20% in best-cost countries in Eastern Europe, and the number of multi-sites will have been increased to actually 5. At the same time, we significantly increased into automation. So we see a higher automation capability in all of these plants. Let me illustrate this even further in showing you 2 examples of our assembly plants. So here on the slide, you can actually see our 7 assembly plants in Europe. It's called -- the first example, Aschaffenburg. Here, the plant can actually benefit also from the new truck generation. And we had the question earlier, "How do you manage the transition from IC to E?" And the nice thing is now with our new truck platform, where we not only have a high modularity between STILL and Linde, but we also have a high modularity and many same components between the IC-truck and E-truck. For our customers, that means you will get, on one hand, trucks with the same performance, E- equals IC-, but you also will always have the same interfaces. So also for the driver, it's very easy to switch from an IC-truck to an E-truck. For operations, this means we now actually can assemble IC- and E-trucks on the same assembly line. So however, the market demand changes, we can still produce some of the same assembly line. This means producing more. And while assembly lines actually have a higher tech time, higher tech time translates into higher productivity. So it's a huge benefit for us, not only for the customer, modularity, but also helping our assembly lines to improve overall in productivity. And additionally, in this plant, we invested heavily into automation. For instance, welding robots for the chassis as well as in powder-coating for the mast. And that's not the end of our automation journey. We will continue that for our logistics as well as assembly processes. On the right side, Kolbaskowo, the new plant we are building in Poland. The building is almost complete by now. And overall, the plant will be set up by the end of this year and will go live early next year. So this will then expand our footprint in best-cost countries and also is a great location, bringing us close to the Eastern European market as well as to some very important suppliers to us. Let me finish this section with some examples of how we drive efficiency also in the sales and service processes. Three examples here. On one hand, we've decided to introduce a group-wide CRM system. That actually helps us to improve the effectiveness as well as the efficiency of our sales organization. The second example is the consolidation of our back offices in Germany. And we continue to do so in the United Kingdom going forward. And the last example, going back to in-van delivery for all service technicians, which we continuously increase by scaling our multi-brand distribution warehouses. And again, that optimizes utilization of our service technicians. So these are just 3 examples of many, many others that I could show how we drive efficiency improvement throughout our business model. So overall, the profitability drivers for KION IT&S is technology leadership, resilient services and efficiency improvement. And let's now take a look how this translates into our financial perspective. And overall, we consider IT&S a highly attractive segment with a profitable growth outlook in the midterm beyond 2020. But as Anke indicated, 2020 is an in-between year. The net sales range, we expect to be between EUR 6.2 billion to EUR 6.5 billion, and that's impacted by slightly lower order intake in 2019, which we partially compensate by growth and resilient services. On the EBIT side, we do see a slight dip, and that is impacted by the investments into products, into production infrastructure as well as in digitalization. The examples that I've shown you already, but you will see more examples when CP talks about growing in China as well as mobile automation topics that Eike Böhm will speak about. So short term, those investments will have an impact through depreciation, increased R&D as well as setup expenses, but we consider them to be key to continue our technology leadership, and thus, our profitable future of the KION IT&S business. And midterm, then we expect growing markets, and with our new product range and offering, we will continue to outgrow that market. And once those short-term effects from the investments will have phased out and our efficiency improvements will contribute, then this will translate into EBIT growth. So again, KION IT&S remains a highly attractive business segment. We want to remain very relevant for our customers, help them to address their customer needs, and we also want to obviously stay ahead of our competition. And we also want to make sure internally, that we stay ahead of the SCS segment. And now I hand over to CP, who will give us some more insights onto growing in China.

Thank you, Andreas. Good afternoon, and a warm hello, [Foreign Language], from my side. And I think some of you, I actually have known you guys for quite some time since Day 1. But I would still like to take a chance to do a brief introduction about myself, if you do not know me. My name is CP Quek. I'm the Chief Asia Pacific and Americas Officer for KION Group. I started my career -- starting from ABB and then moving to GE, Eton. And then in the last 15 years, I'm one of the happiest guys on Earth simply because I joined a company called KION. And over the last 15 years, I've been starting my career, running our business in China, Asia Pacific. I joined the Board since IPO Day 1. And most recently, I take over the responsibility for Americas. So I'm very happy to be here today to share with you something about China, which is one of the most important market for KION IT&S and also, SCS going forward. So if you look at the first slide, this give you a quick glance about where we are as KION in China. And I think the key messages I want you to take away is that China is not new to KION. We know China very well, and we have done very well there. And you can see from the slide, we have been there since 1993, 27 years ago, starting in a place called Xiamen, down south. And over the years, I think we have been growing ourself to become the largest foreign player. As Gordon say, we are #3 behind 2 big Chinese giant. And we are probably, if not, the first foreign player who actually went into China and actively pursuing our business in this marketplace. And we are now running our China operation with 2 unique brands of KION, which is part of our multi-brand strategy, namely Linde and Baoli, so that we can cater for the wide Chinese customer needs. And you can see that we have almost close to 4,000 employee, where more than half of them are actually sales and service. Actually, we are always being dubbed the sales and service machine in our industry. Many of our competitors are eying for our talent. And as well, we are not just selling and servicing in China. We have built up, over the years, our R&D facility in China, where now we have close to 350 R&D engineers being there. And as well, the remaining people, which are more operation, factory, manufacturing, supply chain-related, which they are now running the operation from 2 of our facilities in Xiamen, down south, and in Jingjiang, pretty close to Shanghai area. And over the years, we have done our homework. We have done a lot of localization in China in order to be successful there, where you can see that 90% of our products and component are actually locally produced and sourced. And this is a significant advantage that we have compared to some of our foreign competitors. So I think since we say we are doing well, so why we need to have a new plan? The market has evolved tremendously. And in order to keep up with the market changes, we aim even higher. We want to raise the bar to make sure that we really can enter to be really the Top 1 or 2. And that's why we are creating this new era, new strategy that we hope we will show you in the following slide. So there are 4 highlights you can see here in the slide. First, I think I'm sure you would agree that China is and will continue to be the largest forklift market in the world, especially when it comes to units. And even though the growth rate in the recent year have somewhat normalizing, as what we call in China, but still, the mega trend of such as urbanization, such as mechanization, e-commerce and orders, which are growing tremendously in China. And also, the sheer size of the Chinese market is so huge that it is a market that we have to invest further, which I'll explain a little more. Secondly, I think we can capitalize and leveraging on the solid foundation that we have actually built over the years, be it branding. If you go to China, Linde, everybody in forklift market know about Linde; the people, as I mentioned, just now, the talent that we have; and as well, we do have one of our largest anchor investor with Weichai, which also have a very strong position in China. And our next strategy insight will be focusing on how to leverage on this to bring us to the next level. And we will develop a strategy that will further upgrade our R&D capability to develop new product for new segment, namely the value segment, which I will talk about it. We have to further expand our sales and service network to better cover what we call the lower-tier city, which in the past, we were not in. And of course, we need to build up capacity to build efficiently this new value segment product. And ultimately, not only this will help boost the growth in China, but it will also enable KION to use this product to also win in other parts of the world. And finally, of course, all this doesn't come free. I think Gordon and Anke has mentioned that we will be making an investment of EUR 100 million. I remember this is maybe the largest investment we have make since 27 years ago, when we put up our big Xiamen plant down south in China. So I will provide you more details in the subsequent slide. Sorry. So why we say China is such an important market? I think, first, let's look at GDP. I think China GDP is now a significant part of the world GDP. It say 17% here, but I saw somewhere, it says 19%. And out of that, 30% of the world forklift that we sold globally in a year comes from China. But if you look at what is KION, we only have 14% of our order intake of forklift coming within the group, which means it is a significant upside potential. If we can grow further our market share in China by selling simply just more trucks. Not just China is the largest single marketplace, but as well, the growth rate over the past year is simply tremendous. If you look at the slide, you will see the CAGR in the last 5 years up at a staggering 12%, which even last year, 2019, was actually a pretty difficult year. China still grew at 8.6% and if I'm not wrong. As said, even with the GDP is normalizing, we still expect the growth of the Chinese market to continue and faster than all other market. As Andreas showed just now, I think the CAGR for the next 5 years will easily be between, at least, 5%-6%. So how do we meet this market development and really capitalize on that so that we can continue to grow? As Gordon actually highlighted before, there are 2 emerging key market trend, which would drive the future of the market. Number one, the growing value segment because in the past, you will see Chinese are very much eco -- we call it the economy segment. So this is really growing. And second, the acceleration of the electrification, which actually already happened in the warehouse segment. But not yet in the counterbalance truck, but it is coming. And over the years, we can see our Chinese customer have actually changed their buying behavior, moving from eco to value, moving from just buying on price and now, they're starting on buying on values. So which means not everything is just based on price. So they will look at factors like branding, your afterservice, quality, functionality of your products as a brand. So I think these really is a good news for us. Next, I think most of you read from the papers that our Chinese government is actively pushing change of old power to new power, which means electrification not just in the car industry but as well in the forklift industry. So with the tighter, stricter environmental regulation, the electrification will accelerate very fast, especially driven by the total cost of ownership of lithium-ion-powered truck. As most of you know, a lot of the cells, which means the core of the lithium-ion, are produced in China. And these is really giving them the scale to really bring a scale effect, and drive the cost and drive the adoption of this technology in China market, much faster than any place else. And we believe by 2025, the shift of the counterbalance truck from diesel, engine-driven truck to electric will be easily reaching half, which right now is barely less than 20%. Again, this is a good development for KION because this is where we are strong in. So we have to capitalize on this 2 emerging trend, in order to win further in the marketplace. So to address these 2 major trend, we have put up a comprehensive growth strategy, built around how to capture these 2 trends. Our key strategy actually have 3 core parts. One, we have to have a new product that cater for the value segment. We simply just can't use the premium truck or the current Baoli truck to just serve for this market, if we want to be competitive. We need a new facility in order to produce this truck and an R&D center to make sure we get this product, fully developed in the speed that we need. And of course, we need to sell these through a new network that can really cover this segment of customer. And in this whole strategy, our shareholder, Weichai, will also help us out along the way in some of the strategy. I will give further explanation each of this in the subsequent slide. First, products. In order to ensure we have the right product, which is truly competitive and that can serve this value segment, I think there are 4 key enablers here that we believe, with these 4, we can be successful. As I say just now, the market trends toward electrification actually is a great news for KION, simply because KION is the market dealer -- we are the market leader in electric powertrain. As Gordon say, I mean more than 80% of our trucks are electric-driven. So we are the leader in this area. We also can leverage on Weichai, if you read the news that they are investing heavily in new energy. The 8-fuel cell, the lithium-ion. I think this is what we can tap on. And secondly, addressing the value segment, which you may think it is new to us, but actually this is not. We are not starting from scratch. Over the past few years, actually we have accumulated a good base of experience by launching the Linde so-called Smart Line, which is not a premium product, but which is actually tackling what we call the high-value segment. And as well, Baoli also have a range of ECB, or Electric Counterbalance line, that is also addressing the value segment. So I think these really give us some good experience in how to promoting this kind of truck, balancing between premium and value, and knowing how to mitigate cannibalization and risk on our premium customer. And of course, the game changer in this new truck is really the new modular product (sic) [ platform ] design that our team is working on now. This is our secret weapon. What we are doing is we will be able to leverage on these new platform. We can create all kinds of variance of new product. We can switch between E to IC. We can move from a small tonnage to a higher tonnage, simply using the common component. And it's just like a puzzle. They can put it up and effectively creating this modular concept. And our team now is able to work on that with high speed, high agility. And with this concept, we can achieve the economy of scale, which in the past, we do not have. In the past, we just have Xiamen premium product, Baoli eco product, but there's no synergy across all the component that we are using. So I think this is a game changer and we can use this to really outperform our competition who is now serving this segment. And lastly, as Gordon mentioned just now as well, it's all about people. We are also making structural changes within our Chinese organization. We want to make sure that the structure that we are putting in place will enable our Chinese team to be able to empower and really make decision, move things on quickly in a Chinese speed. In order to compete with the Chinese player, you have to play a different ball game. And we are making this kind of organization changes from R&D, sales and service organization, production, sourcing strategy. And I think this will change the way how we run and compete with the local Chinese leader. Next, we need to be able to sell this very nice product, competitive products to the marketplace. And to do so, we need to dramatically expand our market coverage, simply because in the past, we are more a premium player. So the coverage we have is more on the customer that really appreciate our products. And now we really have to increase our touch point to a customer that we did not serve in the past. From the map, you can see that the blue dots here in the map are actually showing the existing network that we have. And under the new strategy, we will expand our point of sales. Currently, we have less than 300 in the total Chinese. We will increase it to more than 500 point of sales moving forward. And especially increasing our coverage, focusing in the key economic zone such as the One Belt, One Road, Yangtze River Basin and et cetera. And of course, as I mentioned just now, there are a lot of lower-tier city, which we did not cover in the past. And now with the right product, we can cover those city. And also by adopting a brand-new KION multi-brand dealer approach, where we will have a brand-new dedicated exclusive KION dealer, not Linde dealer, not Baoli dealer, but these are KION dealer that will be given a portfolio of product to serve their customer in a selected geographic coverage. And I think this will really help us to expand our market coverage. And of course, we will still further strengthening the existing network of Linde and Baoli because the market is still growing. Lastly, we will further complement our network expansion by working closely with Weichai, final truck -- I mean, I think you guys know all the setup of Weichai. We can leverage on the existing dealership network, service provider -- service point that they have, vast distribution center that they have throughout China. And I think this is an added advantage that none of our competitor has it. But we need to capitalize on that. And to meet the sales target, of course, we need to build the product in the right place efficiently. And therefore, the plan, as just now you have seen, we will be constructing a new production plant in Jinan. If you don't know where is Jinan, Jinan is the capital of Shandong province, which is one of the largest province in China. This plant will be one of the largest in the entire KION production footprint. In terms of size, it is about 220,000 square meter. And as well in terms of the state-of-art facility. Fully automated, mixed line, you can produce E, IC commonly in the production line. And the new modular value platform product will be built in this plant. And I'm very excited to tell you that, I mean, we are now commencing the work on this plant within this year and the production will be starting in 2022. And again, as I say, this is our largest investment we have make since many years back. And this new plant is made possible through a joint venture with Weichai, where we own 95%, Weichai owns 5%. And actually, this plant is part of the overall gigantic Weichai Industrial Park, in this area called Lai Wu, if you haven't been there, anyway. I mean it's a small village now, but it will be big with big production facility. And the production plant is only one aspect of the EUR 100 million investment that we put in, and on the same location, we are building up a new R&D Center. And this R&D Center will be focusing on this new value truck, which is with what we call KGCT, KION Global Counterbalance Truck. And it will be the center of excellence for our global market. So we have to put a team to be able to design the product that meets the need and the speed that we need for Chinese market. And of course, this will further strengthen our position globally. I'm confident that if we can be competitive in China, we will be competitive in any way around the world. Finally, I think to wrap up all this action plan. So how will this impact our future position in the Chinese market? I think as mentioned in the beginning, even though we are now the leading foreign player, actually, we have more than 50% market share among all the foreign players. But if you look at the total market size, which is mainly dominated by the Chinese with eco product, we just merely have single-digit market share. And this is not enough. So when we mentioned a new era, which means we have to put in effort to really double up our market share. In this case, we will be enjoying a double-digit market share if we do this right. And also in our business plan, our quantity or the volume and the sales revenue that we will be producing by 2025 will be doubled. And of course, I know you guys are very concerned about short-term margin dilution. Yes, it will give some short-term margin pressure in the beginning of stage because -- mainly because of the initial investment, the setup costs. But overall, this new value product is -- I have to tell you, it is a profitable product, as good as what we have as of today. And overall, we will be able to grow our EBIT margin to double-digit by 2025. And again, not forgetting, all this benefit will spill over to not just China but the rest of the world because we can use this product to serve other market who need these kind of products. So as a conclusion, our future in China is bright, and I'm very, very excited to see things coming in. And again, thank you for listening. And with this, I will pass on to Hasan, who will now talk about our SCS, our Dematic business, which is also equally exciting. And I look forward to all the questions that you may have during our Q&A session later. Thank you very much.

Thanks. Thank you, CP. And I would say it's a little bit more than equally exciting, but we'll see about that, right? First, for those of you who have not met me, my name is Hasan Dandashly, as introduced by Gordon earlier in the day, and I'm the President and CEO for Dematic. Little about me is I spent 20 years of my life before here with GE and 15 years with Honeywell. And I have about 20 years of software business kind of leadership and 15 between industrial and industrial services businesses. And having had a very diverse career, people ask me, "Well, why this? What is it that you like about what you're doing at KION? And why did you come to KION?" I've been here since May of 2018, as I said. And as I have been very fortunate to really work in multiple industries, from industrial control with Honeywell and avionics to transportation, power generation, oil and gas in GE, and when I come to work every day, I feel like I'm a kid in a toy store. I say, obviously, have the opportunity to work in what I call 21st Century economy, right? Bringing together mechatronics, software, robotics, digital, together, to do things that you see the output of at your doorstep every day with deliveries that come to you. So this is truly an exciting time for our industry today and for years to come. So let's talk about why is that. This is an industry. The best way I would describe it is, in transformation. And automation is at the heart of this transformation, not only because it provides for efficiency, because everybody wants to run their operations better and cheaper and faster, but it is because it is actually empowering and inventing new business models for our customers. They're doing things today with automation that they couldn't dream of or those business models did not exist until now. For 200 years, Dematic has led the industry in providing specific solutions for customers' needs and the verticals that they operate in. We have the broadest set of technology products. We have the scale and the footprint to make sure that we're able to deliver to our customers in every part of the world that we operate in. Execution speed and standardizing what we deliver, the components, will drive not only top line growth but bottom line efficiency. Our services capabilities and our services network, as I would show you a bit later, truly make us lifelong partners to our customers. And last but definitely not least, software and technology are the intelligent part of intelligent supply chain. And we're very excited about DAI joining our KION and Dematic family, and I will talk a bit more about that towards the end of the presentation. So what is driving this transformation? As you could see from the chart, all the metrics are pointing to continued growth. Urbanization is at 55%, and people continue to move into cities. That drives more and more need for e-commerce and the solutions that we do. What used to be a luxury only 1 year ago -- we don't have to go that far, this is how far we go. Today is just what you all expect, right? Groceries deliveries to your front door in 2 hours, everything else in 2 days and the ability to return for free. So there are new normals that are being defined very fast in our industry in supply chain solutions. You're used to a department store or to a grocery store handling thousands, maybe hundreds of thousands of SKUs. One e-commerce provider, you can all guess their name, handles 350 million SKUS. This is the store of tomorrow, 350 million SKUS. Consumers, all of us, want to shop anyway we want, from the store, from e-commerce, pick-up, return, and that is driving this whole concept that we call omni-channel in our industry. The most striking number on this page, if you have to remember one, is called 10%. Of all the warehouses that exist today, only 10% are automated warehouses. We project that over the next 30 years, that will become 65%. Just look at the opportunity to drive more efficiency and more automation for all our customers for years to come. So what does this mean to our market size? Our market size will double between now and 2027. Gordon earlier in the presentation showed you that the market size for SCS will become larger than the market size for IT&S by 2027. I always tell my younger brother here, Andreas, that is, "I'm too old and too impatient to wait until then." So the race is on. We'll see where it goes. I can't wait to '27. The growth is happening in all regions as you see. So nobody is excluded from that growth. The 10 most developed economies by 2030 will have 5.4% less labor. E-commerce, that is today at 14%, will grow to 22% in 5 years. That always continues to drive growth. These are the business models we know today, and their business models of tomorrow, we're going to learn every year. One interesting fact is between the holiday season, at least in North America, but similar to the rest of the world starts on Thanksgiving Day and kind of goes all the way to New Year's. Last year between Thanksgiving and New Year's, $100 billion of product was returned. And that was up $6 billion from the year before. The product that gets returned needs to be processed, and that's going to continue. It needs to get back on the shelf as soon as possible, and that will continue. A lot of that gets discarded by the way today, the product, because they just don't know how to process it to get it back. So it becomes -- gets into a landfill. That's going to continue to create more opportunities for automation. So why is it that Dematic is so well-positioned in order not to benefit from this, but to continue to drive this industry forward? As you could see in our mission, I don't have to read it to you, we offer solutions and vertical markets to meet our customers' needs. So we start by working very closely with our customers, if they are in the apparel business or pure-play e-commerce or in groceries or general merchandise to develop a solution that meets their needs. And then we have the broadest set of products that are out there in the industry. So we bring our product technology that we have, combining it with our advanced software to create a solution for our customers. Then we have our engineering workforce, our manufacturing footprint, our project management, that brings all that together in order to deliver to our customers. And then we back it up by the most diverse service network that exists in our industry in order to make sure that we are staying with our customers. The average age of a distribution center is 20 years. Sometimes when we do really good with them, it goes even longer than that, and I'll show you an example a little bit later. If you received a parcel at your doorstep this week, and I'm sure you have because otherwise, something is wrong, right? It is very likely that it is 1 of the 18.5 million parcels that Dematic equipment is processing every day in all corners of the world. That's how deep we are, that's how broad we are in our customer base. And by the way, we have only done this for 200 years. So how do we do all of this? This is a description of all the different product technologies that we have. In the distribution center, you start by you having to convey product. You have to sort product in a very busy highway system inside the distribution center. Then you have to store the product or the pallet or the tote, lift it up, bring it down. Then you have to pick it even manually using workstations and things like this or robotically by having the robot speaking in order to deliver. You have to palletize, build a pallet, or de-palletize a pallet. And we also have AGV systems. We have 12,000 ASRS machines that are installed globally. I was recently visiting China and I went to the foundry that Weichai has, our shareholder. And walking around, and I'm looking -- I said, "Yes, as you could tell, foundry is not a very clean place." Right? I see a yellow column, the Dematic yellow. We've had a shuttle installed there from before KION even knew who Weichai is. And it made me very proud to see that our technology has existed there for a long time. We invented the term multi-shuttle. So -- and we have the Dematic multi-shuttle, and we have 17,000 multi-shuttles that are installed globally. And we just announced our newest generation of the DMS last week. Automated guided or automatically guided vehicles, these are forklifts and trucks that have no drivers, they have no place for the driver to sit, that are fully automated that we provide. We lead the market in providing these, in conjunction with our systems. We are combining that experience with what we know about forklifts and trucks, and Eike will present that to you, to truly become the most competitive and successful mobile automation provider across our industry. And then we're able to -- and then what you see in the middle, it's called Dematic IQ. It is that software that glues everything together and it is the intelligence that comes into the system. And then we're able to package these products, and you'll see a couple of examples from a small offering to a very large offering that could be a very large distribution center. And we deliver this globally, everywhere. We are where our customers need us, from defining the solution to delivering the solution. Because when we work with our customers, as I will show you in a minute, we spend a good amount of time developing a solution for them. And we have the expertise in all the regions we operate in to develop these solutions locally and then to deliver them locally. We operate in 29 countries worldwide. We have 11 factories that cover the globe. We have 50 service centers that provide services to our customers. We have the most skilled workforce in our industry, and we're very proud to have more than 3,000 engineers. This is a technology and engineering-intensive business, having the know-how is critical. And you've heard before every time you talk about challenges is getting enough qualified people to meet the challenges of the industry, and we're very proud to have these engineers. So how does it all come together? 3 major steps that I will go over. We start, first, working with our customers to develop a solution jointly. You saw during the lunch, if you are up -- were in the back, what we call Virtual IQ, the ability to virtualize what your solution is. This is not a gimmick. This is not just like some third-party piece of software we get and you can look at it like you do with games. We actually sit down and we define what the solution is for our customers together. And then we model it so that we are able to show them how it looks they can go look at it, they can see it. Because prints and charts and drawings are one thing, putting your goggles and walking through your distribution center is something else. And then more importantly, we simulate it. Because you're building a distribution center that you will get a year, 2 years, 3 years from now to meet your business needs then. You have to be able to say, “Is it going to do that?" So we actually do a fairly high-definition simulation to make sure it meets the needs. And we have a lot of what I would call internal IP, a lot of digital tools that we use in order to model, define, design and estimate these systems that we do with our customers upfront. So that's Step 1. Step 2 is where the hard work begins, right? We have to actually build these systems. We build them from what we call vertical market-based subsystems and solutions. So we take a solution that we could use in different industries or different verticals, and then we put them together in order to create a system for our customers. And we try to drive a lot of reusability because that improves our cost, our quality and our bottom line. But we always make sure that we are maintaining and delivering the specific customer needs that they need. Step 3 is we deliver this regionally. We have to be close to our customers. You can't be shipping cranes all over the world. You can't be shipping installation labor. So we actually deliver this very regionally. We have 500 excellent project managers that lead these projects from simple to complex. And we get product from our factories, we get product from our resale partners, and we have installation crews globally and will deliver these for our customers. And we do this across many verticals. If you are Zara or PepsiCo or Aldi and completely different business segments -- verticals, you really do not need a conveyor or a shuttle. That just doesn't mean anything to you. You need a solution that meet the specific needs that you have for the way you want to run your business within your vertical. And this is where we have the experienced solution developers that understand these different markets, that work with many customers, that are able to truly develop a solution to meet that customer's needs. The technology components that we use, and you can look across them and say, "Well, they're all the same." So you tell me, "Hasan, that e-commerce is different than apparel, different than groceries, general merchandise," because I have to have expertise in those markets. I can't go and sell a general merchandise what I sell an apparel company. It's different needs and I have to understand their market and how it operates. But the DMS, the Dematic Multi-Shuttle, can move totes that are full of frozen chicken or high-end apparel, and it doesn't matter. It's the same. The AGV, actually we are very proud, moves the currency for the Federal Reserve in the U.S., and it also moves servers for Google, the same AGV, which is customized differently. Our Pouch systems -- we have a Pouch system, is used heavily in returns processing because you could drop the item, [indiscernible] package, and our looking at using it to bag potato chips because you don't want to get them crushed. So -- and then we package our products, third-party partners and our software to deliver an end solution to the customer in this vertical market. So now let me give you a couple of examples of what we're doing. This is a leading luxury retailer that -- life for luxury retailers was simple. You have a big department store, you have a big name, you're sitting in a big mall and customers are coming to you, and you sell and life is good, right? And you do a lot of your sales on between 2 or 3 weeks before Christmas and New Year's. And this luxury retailer was looking to say, how do I optimize my whole supply chain? They needed to fulfill to a large network of stores. So you need to populate, you need to push product to your stores. And you have to get the right product and the right size groups in the right location based on the population of that location, what sizes you need and what product they want at the right time of the year. So you really have to use the intelligence to say, "How do I get these products to these stores?" At the same time, you also have to be in e-commerce. You can't be anymore a luxury retailer without being very active in e-commerce. And they needed to truly implement a very effective omni-channel. You can buy anywhere, you can return anywhere, it's the flexibility for the consumer to be able to buy online, buy in the store, return here and there, vice versa, it all works. And given that they are in apparel, and now e-commerce is taking a bigger portion of their business, they have to deliver e-commerce, what do we all do, right? We order the size we like to fit in, the size that we are in and the size that -- what we might need after the holidays. And then we have to return 2 out of the 3. So if they're not efficiently managing their returns, their business will get impacted heavily, right? It's not like -- groceries, you don't return them. But apparel, high-end luxury apparel, if they're not able to process the returns and get them back on the shelf, they can't stay in business. So they came to us. They are building what we call a jumbo distribution center. And to give you an idea of size, you can fit 16 American football, not soccer, not European football, fields within that distribution center. It delivers 500,000 parcels or units, clothing basically or shoes or whatever, every day. And they have to come to somebody that has the proven track record, the technology, the dependability that will be around in order -- and the scale to deliver this. And that was Dematic. As you go to many shows -- I just want to use this here to underscore this point because you all go to industry shows. And many times, you see very shiny widgets. People could come up and invent an AMR or whatever. There are very few that can do what we do, that have the scale, the capability, the product and the software to do this. And doing distribution centers like this is a big vote of what is it that we're able to do. So now let me take you to the other side of this formula, to small and fast, okay? You've heard before about urbanization, micro fulfillment, and this is a -- the system that your -- with the urbanization growing, that you should be able to fit in the back of a grocery store or the basement of a building in order to do fulfillment, either for delivery at home or for what we call click-and-collect. What's exciting for us here is -- the first one was speed. When we looked at this and we said, "This is a market we need to be in." From when we generated the idea until we had the first one up and running in one of our factories to demonstrate to customers, it was 6 months. We were able to do this because we knew this space, we knew the customers, we were able to reuse standard components that we have to build it and we built it in 6 months. And then to install it, it only takes 12 weeks. And as we speak, one installed and is running and is delivering product in Grand Rapids, Michigan, and another one is being installed and soon will start operating in Europe. So hopefully, next time, you click and collect your groceries or they get delivered at your home, they will come complements of Dematic technology. So now let's bring this to life and get you to see -- did it go? [Presentation]

What's exciting about this to say just a couple more words is you might look at this and say, "Okay, you've done multi-shuttles. You told me we have 17,000 of them. So you just put a few of them in the back of the store. How is that so exciting?" It's a lot more than that, right? Because this system doesn't only have our mechatronics and this. It has the software capability and the intelligence to do both, fulfilling from this system and fulfilling from the store. Because not everything you're able to get from the automated system. You have to go and collect it from the store and we have the apps that the person who's going collecting from store to prepare an order. And the system is also optimizing based on what product is moving fast, what you have on sale, what you have this, what goes into the shuttle versus what gets fulfilled manually using the app and how you populate the shuttle as it goes. There's a lot of intelligence that has to factor the way the grocer is running their business at that time and what's selling today. It's a hot day versus a cold day, what's on promotion and what's not. So far, I've described to you how we bring solutions together. We work with our customers early on. We understand their needs. We develop a solution, we bring our products, our software, our know-how, our scale, our execution capability and deliver to our customers. Now we have systems up and running. Today, we have 6,000 installed systems out there that would provide services on. That is a huge opportunity for us and a huge opportunity for our customers. Before I get into what we deliver, I want to take you back to that large, what I call, the jumbo DC that we are building as we speak. 24 years ago, we built a small distribution center for that customer, and we've provided services over 24 years. And that distribution center is delivering better, more throughput, more efficiency today than it did 24 years ago. Every year we service it, we made it better. And that's why when this customer was looking now at completely changing their business model and doing something big, we were a partner of choice because we have proven what we can do with our customers when we stay with them. We have a comprehensive portfolio that you see on the chart from parts, repairs, field services, resident services, consultancy, modernization and upgrades, and I want to walk you through 2 distinct examples that are on the right. That one shows you what we do for an existing customer and how we keep their stuff up and running and one that brings our digital technology to life. At the top on the right, we have a major retailer with 43 sites that we have built for them. We started the program to do what we call modernization and upgrades. We send a bunch of experts, they walk through the distribution center and they generate ideas for how we can make things better for the customer. By the time we did 2 or 3 distribution center for these guys, it clicked into their head. They actually got preauthorization, sent a purchasing person walking around with our team and issuing purchase orders as they were going and making recommendations for what need to do. And the result, the part sales for that customer went up 26%. More importantly and we're very proud of, the throughput in their distribution centers went up 7%. Just think about how that drives productivity for these retailers that we are serving. The second example is a Fortune 500 industrial company that we do work in that we're piloting what we call predictive maintenance. So instead of waiting for things to fail or just follow our maintenance procedures, we instrumented a lot of their systems, and we're able to detect all the signals, be able to predict a failure before it happens, intervene right at the right moment and make sure that we make the repairs that are needed. And by doing that, they are able to achieve 5-weeks payback. So our services are very comprehensive, and now we are truly utilizing digital in order to make sure that we continue to advance these. And services, as I showed you -- or talked to you earlier, is not only good because it drives more service business. It drives systems business, it drives service business and contributes significantly to our bottom line. And now let's get into the intelligent part of intelligent supply chain. The automation in our industry started in order to save labor and to save space. So it was about saying, "I need to have less labor because labor is expensive and is not available and I have less space, so I need to convey product, I need to sort product, I need to lift it up and down and store it." Today, automation in our industry is truly about transforming business and creating new business models that did not exist before. And the intelligence in that supply chain comes from software. And one thing I like to say, that the good thing about software and the bad thing about software is the laws of physics don't apply to software. So the possibilities are limitless to what you can do. And this is where the creativity comes in to truly drive business models for our customers and growth for them. So let us kind of go through what does software do in our industry. Because you hear us say we're excited about software, we're investing in software and say, "But I see AGVs and I see shuttles, I see all that stuff. Where does software come in?" If you look at the bottom layer, what we call programmable logic controllers, this is a software that is intended to control all the moving parts that are moving in a distribution center. Give you an example, a distribution center could have 13 kilometers of conveyor that is running around. That requires hundreds if not thousands of motors and drives and everything to kind of control it and drive it. We have in one 1.2 million tote positions for the shuttles. So the shuttle has to hit 1.2 million, has to move. And this is the software at the bottom layer that keeps all that equipment running and running in sync. When I first started, I said, well, I've worked on jet engines, how complex could this be, right? I've worked on jet engines that fly and fly nonstop. When you look at these distribution centers and you get in and you find the huge number of rotating equipment and moving parts that has to move all the time, move in sync and move reliably and cannot stop, then you get a sense of complexity that is completely different. And it is that software that's keeping all that stuff moving. You move one step up to what we call warehouse control system. So now all the equipment is running, is moving, is doing its job. But now you have product that is coming in and a product that needs to get fulfilled, either for a package to go to your house or a pallet to go to another distribution center or whatever. The software is making all these decisions on what product is flowing where and how it's getting ready to meet the requirements of the customer that is running that distribution center. That is a very complex problem that requires a lot of intelligence in the software, not just simple data processing, a lot of intelligence in order to execute these missions and optimize what you get from these distribution centers. That is a competitive advantage that everybody wants to have, is how do I optimize this so that my product is moving properly, being optimized and delivering to my business needs. And then you get up to the warehouse management system, where you could be managing both automated warehouses or manual warehouses, and you get into managing labor, managing inventory and the operations in general. And then you get into supply chain execution, which is outside the 4 walls of the warehouse that you see circled in yellow. And that is about order and demand management, transportation, retail management, click and collect, things that get into the network in a general way. And then you have your ERPs, just like every business. You need to have your ERP to run your business. And then what we have -- what we call digital, right? Digital portfolio. And we've already seen examples of a digital twin that Andreas talked about before or the digital twin that you saw with the Virtual iQ (sic) [ iQ Virtual ] and then the -- also the remote monitoring and diagnostics that he showed you for IT&S and predictive maintenance that I talked about. All of these things are under a digital portfolio. So why are we so excited for DAI joining our team? You look at where you see iQ, these are the offerings that we had. We've been very -- we have a comprehensive at the PLC level, at the WCS level. And we had capability at the WMS level, but DAI had a more complete capability at the WMS level. And we have partnered with them before to deliver large systems that require a large WMS. And they also bring supply chain execution capability for small and medium-sized customers that will open doors for us to get into more automation as these customers start moving along their automation journey. So if I talk a little bit more specifically about the different elements of DAI, with what we have in software and the capability they bring, we are clearly #1 in providing WMS, WCS, WS offerings in our marketplace. We're the undisputed leader in that area. With their supply chain, it opens up new doors, it allows us to become more relevant for our customers in areas that we did not get into before that is outside the 4 walls of the distribution center. They are a very well-run company with more than EUR 40 million in sales that has been growing fairly well, more than 25% in adjusted EBIT, and what's very exciting is the stickiness of the customer. More than 70% of their revenue came from services on software. So to do services on software, to do that well, you're doing something right because it's not -- you're not changing, moving equipment that you have to replace all the time. We know this company well, we have a great cultural fit with their people, and we've done many projects together for the last 20 years. Not to mention, as Anke mentioned, it's a nice, attractive and a fairly exciting market space that we got, also a nice multiple. And so before I move to financials, I wanted to kind of share with you -- this is honestly one of my internal charts that got added late in the game to the presentation because I wanted to share with you what the priorities that my team and I are living by every day. It's kind of a different twist at my presentation because this is what we look at in the mirror every day. We're driving to outpace the market growth. It's a market that's growing very nicely, we want to outpace it. We're driving to make sure that we are growing our EBIT, and we're driving to make sure that we continue to balance our portfolio. We are in the project business. As Gordon told you, we're not cyclical, but our projects kind of move up and down. Because you get large projects, you get small projects, so you can't always compare quarter-over-quarter, year-over-year per quarter. But overall, we are growing, but we have that project size that impacts the results. And we want to continue to balance our portfolio. We do that by focusing on these 5 priorities in the order you see. We start by execution. We have a brand name that everybody knows, 200 years. We continue to execute for our customers. They will keep coming. We execute better, we drive the top line, and we drive the bottom line, and we get more efficiency. We're focused on making sure that we continue to drive our solutions. We are in the solution business, not in a product business. And we have to make sure that we continue to drive standardization in our components to make sure that we can get more leverage, continue to drive our services to get more share of services and to get more margin coming out of that. And again, truly making sure that software and technology are at the forefront of what we do because that is what will differentiate us going into today and into the future, and that is what our customers need from us every day. Now moving to financials from where Anke, our CFO, left. We want to build on the great performance we had in 2019, and we will drive revenues to increase anywhere between plus 5% to plus 18%, and we will drive EBIT and get -- drive to get EBIT leverage and drive that to grow anywhere from plus 5% to plus 23%. And as I wrap up, I want to take you back to where I started. The market fundamentals are strong. We are truly kids in a toy store. This is great where we're seeing it as we look at it, and it will continue for a while. We have led for 200 years. I don't think I'll be around 200 years from now, but we want to make sure that we continue to lead as we go into the future with our capability, with our scale, with our technology and with our know-how. We are focused on execution on standardization to drive both the top line and the bottom line. Technology and software are truly the key differentiators for us. And we are putting our words into action by bringing DAI into our family. And now I would like to welcome our Chief Technology Officer, Dr. Böhm, to this stage.

Thank you, Hasan. What a nice story of growth. And also Andreas, what a nice story you told us about growth. But I will tell you an even better story of growth. But before I start with this, let me introduce myself. I am Eike Böhm, the Chief Technology Officer of the KION Group since 5 years now. And before this, I spent 27 years of my career in the automotive industry. And now if you think about automotive industries, what are the 2 most sexiest things in automotive? First is electric drive, better electric vehicles, e-vehicles. Second one is autonomous driving. So now think about combining autonomous driving, electric driving. In our industry, this is mobile automation. So autonomously driving electric industrial trucks. And KION is a company that has the best prerequisites to lead the industry also in this field. And why? First of all, today, just today, KION has the pole position in this market which is extremely growing. I will come to this, but think of today, we have roughly EUR 2 billion is this market of mobile automation, and in 2023, it will sum up to EUR 11 billion, which is exponential growth. Second is that this mobile automation story provides significant benefit for our customer. It's highly profitable for customers buying mobile automation solution. Third is that KION, our company, with IT&S segment, with SCS segment, with Dematic iQ software platform has perfect prerequisites to leverage synergies from our production from our technology. And last but not least, number four is that KION with the sales force of STILL, with the sales force of Linde, with the sales force of Dematic can leverage cross-selling opportunities. And as Gordon mentioned before, it is somehow the best of both worlds, IT&S and SCS overlapping. That is mobile automation. Let me come to the market. The market is today, KION is #1 in this market of mobile automation. We have the highest market share. And as Hasan said, right now, 8,000 mobile automation units are in the field at customers. And these 8,000 driverless vehicles, they carried more than 3.4 billion pallettes, and they made a distance of more than 300 million kilometers. Now again, think back of automobile industry, passenger cars. I think we are even exceeding passenger cars with this, 8,000 fully autonomously driving vehicles since many years, and making 300 million kilometers of autonomous driving. And this is proof of the unique experience KION already has in this industry. And of course, we have a clear growth targets. You can see here the columns, expected growth of more than 50% per year. This is dramatic. Summing up to EUR 11 billion in 2023. Why is mobile automation so attractive for our customers? Let me come to this. It's very simple. Because for a customer, installing a mobile automation solution is simply beneficial from a financial perspective. And you can see here in the middle chart about the payback of a mobile automation application, and this is not a qualitative chart. This is a quantitative chart based on a real customer installation in Europe. And this customer faced the situation that roughly 80% of the cost of operations is cost for driver, usually. So if you take the installation, buy a truck, pay a driver, driver is 80%. So now installing a driverless vehicle, a mobile automation vehicle, it's very attractive. Second is that, of course, today, and I think Hasan already mentioned this, we have a lack of workforce. So it is -- even if you are willing to pay the driver, it's not so easy to find them. And there is another reason. If some of you already visited a warehouse or a plant and if you look at industrial trucks, most of them have scratches. They are damaged because the drivers, unfortunately, do damage trucks. They make accidents. If you look to a mobile automation truck, usually, you don't find any scratches because they don't make accidents. And this is also a significant cost factor. And last but not least, these mobile automation solutions are more flexible than solutions that have fixed installed equipment like conveyor belts. So that is a clear economical reason behind this dramatic growth of mobile automation market. Now let me briefly touch the technical systems we provide or that are existing on the market, and basically, there are 3 segments of mobile automation vehicles or AGVs, however you call them. And KION is the only company in the entire industry offering all 3 segments. On the left, you can see the so-called bespoke solutions. These are extremely customized vehicles, 1 or 2 built, but very, very specific. They are not produced on an assembly line. They are produced on a [ stand place ]. And they are, of course, quite expensive. In the middle, you find the small batch solutions. These are also handmade vehicles. You build 10, 15 of them. Also not on an assembly line, not mass-produced vehicles, and they are this small batch solution in the middle. And then on the right, you can see what KION is now targeting for massively, these are serial solutions. These are industrial trucks as you can find them today that are automation ready. They are equipped with the technology you need. Just plug in an automation kit, and then you can use them as an AGV, as a mobile automation equipment. And today, we have in the bespoke segment, 5% market share. In the middle, small batch solution, we have roughly 55%. And on the right, serial solution, you have 40% today, today. And what you see here on the slide, 25% and, on the right, 70%, this is expected shift. And KION is exactly focusing on this shift, and we provide vehicles being produced in our warehouse plants that can be easily adjusted to mobile automation trucks. Last but not least, why -- the fourth reason why KION is able to lead the industry and will, of course, lead the industry on a sustainable basis, this is cross-selling capability we have. And you find 2 examples here. One is for lower-complexity installations. So 5, 10, 9 units, AGVs, driving. And this is a company called ZKW. This is an Austrian automotive supplier producing lamps, roughly 9,000 employees, and they installed a system based on STILL trucks, cross-selling together with Dematic, and these trucks are controlled by the Dematic iQ software platform. And on the right side, you can see in 2 cross-selling examples. One is an e-commerce application in the United States with 570 units, also together with Dematic, STILL and Linde in this case. And some of these trucks are even powered by fuel cells. And on the bottom right, you can see the already-published Menards deal, which has been a cross-selling activity between Dematic, Linde and STILL with more than 600 units. So that's why KION will lead the industry in mobile automation. And to give you a much better impression what mobile automation is, I have a video for you. [Presentation]

Yes, let's look again at this single page, the investment highlights. You know, if you kind of review the entire day that we've spent together, the same facts keep coming up. First of all, this is just a great, wonderful market to be in. It's an attractive market. It's a growing market. And I think you've seen enough examples here. Technology is important for the changes in the market going ahead. And we are definitely a technology leader. The changes we've made to the business, both in our services, our production footprint, the way how we do business, digital makes us an increasingly more resilient business model. So we're less up and down, much more resilient going forward. We have a clear plan to invest in the future. I hope you understood the background of some of these investments that we made. But after all of that, we also have a laser focus on our cost, on our efficiency and profitability. And I think these investment highlights truly do support our path going forward and our profitable growth. On a personal note, I would really like to thank all of you for coming here today and taking the personal time, which is not [Foreign Language] as we say in German. It's not taken for granted. So we really appreciate. Thank you also for those of you that joined us via the webcam for the presentation. We would have loved to have you here. Maybe the next time, you will have the opportunity. Our next touch points with each other will be the quarterly statement for the first quarter, and that will be in April. And we look forward to the road shows and contact we have with all of you coming up. It's an exciting time. I'm very optimistic on our business, and I thank also the team, everyone, for the great work, great preparation that everyone has done. I think it was a very good event to tell the story of KION emerging and leading the industry. So farewell, [Foreign Language] and safe travels back home.

Thank you.

Thank you, everybody.