Knorr-Bremse Divests R.H. Sheppard Co., Inc. In North America And Writes Down Remaining Purchase Price Receivable

EQS-News: Knorr-Bremse Aktiengesellschaft / Key word(s): Disposal/Miscellaneous
Knorr-Bremse divests R.H. Sheppard Co., Inc. in North America and writes down remaining purchase price receivable
20.12.2024 / 16:21 CET/CEST
The issuer is solely responsible for the content of this announcement.

Knorr-Bremse divests R.H. Sheppard Co., Inc. in North America and writes down remaining purchase price receivable

• Portfolio adjustment – a key element in increasing Knorr-Bremse's profitability – achieves next major milestone with the disposal of R.H. Sheppard
• BOOST 2026 portfolio optimization fully on track: around €400
  million of the planned total program volume of €700 million has already been sold
• In addition to the Truck Division's clear focus on mechatronic steering systems, the US subsidiary Bendix will now concentrate more on its core competencies of braking systems, vehicle dynamics, air and energy management and innovative driver assistance systems.
• Further measure taken as part of BOOST: Carrying amount of the remaining purchase price receivable from Kiepe Electric written off
• Unchanged strong operating performance supports proposal of an at least stable dividend for financial year 2024

Munich, Dec. 20, 2024
– Knorr-Bremse today announced the sale of R.H. Sheppard Co., Inc. (“Sheppard”), to the US investor Balmoral RHS Acquisition Corp. Balmoral manages assets of approximately US$
1.3
billion and was founded in 2005 with a head office in Los Angeles. The transaction was closed at the same time as the signing.

With the sale, Knorr-Bremse is continuing to implement its active portfolio optimization with a clear focus on core competencies and performance as planned.

Bernd Spies, member of the Knorr-Bremse AG Executive Board and responsible for the Commercial Vehicle Systems division :“With the sale of R.H. Sheppard Co., Inc, we are optimizing our portfolio in our truck division. This transaction enables us to align our business with even greater focus and profitability. In addition to the Truck Division's clear focus on mechatronic steering systems, our North American subsidiary Bendix will now concentrate even more on its core competencies of braking systems, vehicle dynamics, air and energy management and innovative driver assistance systems. With Balmoral, we have found an ideal buyer for Sheppard which will lead the company and its employees in the future.”

Sheppard is one of the leading manufacturers of commercial vehicle steering systems in the North American market. The company develops and manufactures commercial vehicle steering systems as well as adjacent products and services to utmost quality standards. Its revenues in the 2023 fiscal year came to approximately US$
150
million. The transaction encompasses the entire Sheppard business. Sheppard was previously an operating unit of Bendix Commercial Vehicle Systems LLC, a subsidiary of Knorr-Bremse and part of the Commercial Vehicle Systems division.

The disposal of Sheppard is already Knorr-Bremse's fourth successful sale of an investment this year under its BOOST 2026 program. Overall, Knorr-Bremse is working on a large number of strategic initiatives and measures for safeguarding lasting, profitable growth over the coming years and is thus fully on schedule.

The income from the sale of Sheppard will produce a one-time, non-cash and non-operating net loss of approximately €
60
million, which will have a negative impact of around €0.37 on earnings per share in Q4 2024.

In addition, the Executive Board of Knorr-Bremse decided on a fair value adjustment for the carrying amount of a receivable (remaining purchase price and earn-out) from the sale of Kiepe Electric GmbH of just under €50 million. Although the write-off is also a one-time, non-cash charge and will not have an impact on the operating result, it will negatively affect Q4 2024 earnings per share by €0.31.

For the coming Annual General Meeting, Knorr-Bremse is planning to propose a dividend for the 2024 fiscal year that is at least stable so as to reflect its continued strong operating performance. Knorr-Bremse confirms the operating guidance for sales, EBIT margin and free cash flow in line with Q3 reporting.

Media contacts:

Simon Basler | Spokesperson Truck Mobility | Knorr-Bremse AG

T +49 89 3547 1498; E ...

Anika Wild | Spokesperson Corporate Communications | Knorr-Bremse AG

T +49 89 3547 2470; E ...

Contact Investor Relations:

Andreas Spitzauer | Head of Investor Relations | Knorr-Bremse AG

T +49 89 3547 182 310; E ...

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

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