Quarterly Statement

January 1 to September 30, 2021

Q3
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

Quarterly Statement
JANUARY 1 TO SEPTEMBER 30, 2021
KNORR-BREMSE AG
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

KNORR-BREMSE GROUP KEY PERFORMANCE INDICATORS

(IFRS)

Nine Months Third Quarter

2021 2020 2021 2020
Revenues million 5,008.1 4,589.3 1,589.2 1,533.5
EBITDA million 916.3 804.2 284.2 268.7
EBITDA margin % 18.3 17.5 17.9 17.5
Operating EBITDA margin % 18.4 17.5 18.1 17.5
EBIT million 708.5 592.1 213.1 194.6
EBIT margin % 14.1 12.9 13.4 12.7
Operating EBIT margin % 14.2 12.9 13.6 12.7
Net income million 496.2 397.5 150.1 140.5
Earnings per share (basic) 2.97 2.29 0.91 0.82

Incoming orders million 5,038.1 4,355.0 1,435.2 1,627.9

Order book (September 30) million 5,006.9 4,457.7 5,006.9 4,457.7

Operating cash flow million 488.7 369.4 265.1 250.8

Free cash flow million 297.0 168.5 188.8 181.8
Cash conversion rate % 59.9 42.4 125.8 129.4
Capital expenditure (before IFRS 16 and acquisitions) million 212.0 230.0 82.5 82.1
Capital expenditure as % of revenues % 4.2 5.0 5.2 5.4
R&D costs million 315.6 294.0 103.8 99.2
R&D as % of revenues % 6.3 6.4 6.5 6.5

Sept. 30, 2021 Dec. 31, 2020

Total assets million 7,426.2 7,390.0
Equity (incl. non-controlling interests) million 2,222.0 1,921.7
Equity ratio % 29.9 26.0
ROCE (annualized) % 25.3 25.6
Net financial debt/(cash) million 33.5 (102.8)
Net working capital million 1,121.8 746.4
Employees (at reporting date incl. leased personnel) 30,612 29,714

FIRST NINE MONTHS OF 2021

Incoming orders of 5,038.1 million up 15.7% on the prior-year level, primarily due to a very significant recovery in demand

Order book at 5,006.9 million increased by as much as 12.3% year-on-year

Revenues up 9.1% on the previous year at 5,008.1 million as a result of noticeable growth in the global OE business in the
Commercial Vehicle Systems segment
Despite a moderate increase in aftermarket revenues in absolute terms, the share of total revenues fell from 37.1% to 35.0%
Strong increase in profitability: operating EBIT up 20.2% to 711.7 million, 130 basis point margin increase (ROS) compared
with the previous year (12.9%) to 14.2% of revenues underlines profitable growth; operating EBITDA margin at 18.4% also up
year-on-year (17.5%)
Stable R&D ratio of 6.3% of revenues (previous year: 6.4%) due to continued investments in strategic, forward-looking inno-
vation and technology projects
Free cash flow significantly improved at 297.0 million, up 76.2% year-on-year ( 168.5 million) due among other things to a
higher earnings contribution and an improved net working capital
Knorr-Bremse sees itself on course and has narrowed the guidance for FY 2021:
6,600 6,800 million (2020 6,157 million)
Operating EBIT margin: 13.0% to 13.5% (2020: 13.2%)
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

BUSINESS PERFORMANCE IN THE NINE MONTHS OF 2021

Incoming orders up 15.7%

The Knorr- significantly positive at 5,038.1 million as of the end of September 2021, up 15.7%
or 683.1 million on the same period of the previous year. This was attributable in particular to strong demand in the global
commercial vehicle market. By contrast, demand in the rail vehicle market decreased in all regions, due among other things to
Covid-19 and as a result of projects being postponed. This was particularly the case in Asia, where business in China and Australia
took a substantial hit, as well as in Europe. In the commercial vehicle segment, however, global commercial vehicle production
experienced a dynamic upturn, which is reflected in an increased order volume as of September 2021. Significant growth was
seen in all regions compared with the previous year, especially in the European market and the North American market.

The positive trend in the order situation led to an order book of 5,006.9 million at the end of September 2021, which was sig-
nificantly (12.3%) higher than the corresponding prior-year level ( 4,457.7 million) and will provide a solid basis for revenue
development in the upcoming quarters.

Revenues up compared with previous year: +9.1%

In the first nine months of the 2021 fiscal year, revenues of the Knorr-Bremse Group rose by 9.1% or 418.8 million to
5,008.1 million The growth in revenues was attributable to significant growth in the Commercial Vehicle Systems segment,
which more than made up for the decrease in revenues in the Rail Vehicle Systems segment that was largely due to a declining
OE volume and to aftermarket revenues that fell slightly short of the prior-year level. The OE business declined in Europe primarily
in the areas of mass transit (metro cars and light rail vehicles) and locomotives and in North America because of a weaker regional
& commuter business plus a diminishing freight business. Market factors led to a fall in OE revenues in the Asia region in the
metro cars, high-speed trains and railway carriage businesses. The aftermarket business was slightly below the prior-year level in
absolute terms, also due to Covid-19. However, at 44.7% tal revenues was slightly higher
than in the same period of the previous year (44.1%). In the Commercial Vehicle Systems segment, the significant rise in revenues
was chiefly attributable to an increase in the number of trucks being produced worldwide, increased content per vehicle and
related revenue growth in the OE business, mainly in the core markets of Europe and North America and in Asia, principally in
China. As a result of very strong growth in the OE business, despite a sharp rise in aftermarket revenues, the aftermarket share of
25.7% decreased compared with the previous year (28.3%).

At Group level, despite an increase in aftermarket revenues in absolute terms, the share of total revenues was 35.0% (breakdown
in accordance with management reporting), down overall on the prior-year figure of 37.1% due to a sharper rise in OE revenues.

High profitability: EBIT margin (ROS) and EBITDA margin exhibit growth
In the first nine months of 2021, operating EBIT of 711.7 million was generated with an operating EBIT margin (ROS) of 14.2%
(previous year: 12.9%). This is 119.6 million or 20.2% more than in the prior-year period and was mainly attributable to volume
effects from increasing OE business with good conversion despite increased freight and procurement costs. Along with a positive
trend in volume, lasting effects from our cost-cutting

Operating EBITDA of 919.5 million also saw a significant, volume-related increase of 115.3 million or 14.3%. At 18.4%, the
operating EBITDA margin was solidly higher than the prior-year level of 17.5% and therefore showed a margin increase of 90
basis points compared with the previous year.

To determine operating earnings figures (EBIT/EBITDA, also as a percentage of revenues), restructuring expenses for the Rail
Vehicle Systems division in North America were adjusted by 3.1 million against the reported earnings figures.
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

CONSOLIDATED STATEMENT OF INCOME (CONDENSED)

Nine Months Third Quarter

million 2021 2020 2021 2020
Revenues 5,008.1 4,589.3 1,589.2 1,533.5
Change in inventory of unfinished/finished products 70.2 7.6 17.9 (6.7)
Own work capitalized 59.9 56.9 20.7 19.6
Total operating performance 5,138.2 4,653.9 1,627.9 1,546.5
Cost of materials (2,563.4) (2,204.7) (816.0) (736.4)
Personnel expenses (1,227.5) (1,144.0) (396.7) (374.9)
Other operating income and expenses (431.0) (500.9) (131.1) (166.5)
EBITDA 916.3 804.2 284.2 268.7
Depreciation, amortization and impairment (207.8) (212.1) (71.1) (74.1)
EBIT 708.5 592.1 213.1 194.6
Financial result (32.3) (43.0) (14.6) (3.1)
Income before taxes 676.2 549.1 198.5 191.5
Taxes on income (180.1) (151.6) (48.4) (51.0)
Net income 496.2 397.5 150.1 140.5
thereof profit (loss) attributable to non-controlling interests 16.9 28.3 4.1 8.4

The cost of materials ratio increased by a total of 320 basis points to 51.2% of revenues in the first nine months of 2021, in part
due to a changed sales mix and as a result of the increased costs for freight and procurement owing to the scarcity of semicon-
ductors and other components. However, this trend was offset by a slight decrease in the personnel expenses ratio of 40 basis
points from 24.9% to 24.5% resulting from a disproportionately large rise in revenues. Furthermore, the total of other operating
income and expenses decreased by 230 basis points from 10.9% to 8.6% of revenues. At 4.1% of sales, depreciation, amortization
and impairment remained moderately below the prior-year level (4.6%). The financial result was up on the prior-year figure,
which had been impacted in particular by negative currency translation differences, and reduced earnings before taxes by a total
of 32.3 million Income before taxes, at 13.5% of revenues, was a significant 150 basis points above the corresponding prior-
year level of 12.0%. This was due not only to a positive EBIT contribution but also to the improved financial result.

The tax rate fell by 100 basis points from 27.6% to 26.6% in the first nine months of 2021. As a result, net income as of September
2021 accounted for 9.9% of revenues, solidly above the prior-year level (8.7%).
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

FINANCIAL SITUATION

FREE CASH FLOW

Nine Months
million 2021 2020
Net income (including minority interests) 496.2 397.5
Depreciation, amortization and impairment losses on intangible assets and property, plant and equipment 207.8 212.1
Adding to, reversing and discounting provisions 65.0 132.3
Non-cash changes in the measurement of derivatives 34.4 16.0
Other non-cash expenses and income (1.6) (15.8)
Income tax expense 180.1 151.6
Income tax payments (128.8) (66.1)
Changes in inventories, trade accounts receivable and other assets which cannot be allocated to investing or financing
activities (386.3) (386.7)

Changes in trade accounts payable and other liabilities which cannot be allocated to investing or financing activities 66.1 13.4
Changes in provisions due to utilization (85.0) (133.0)
Other 40.9 48.2
Cash flow from operating activities 488.7 369.4
Cash changes in intangible assets and property, plant and equipment (191.7) (200.9)
Free cash flow 297.0 168.5

The cash inflow from operating activities increased by 119.3 million year-on-year to 488.7 million in the first nine months of
2021. In addition to an increase in net income of 98.7 million or 24.8% to 496.2 million, this was also due to a remaining pay-
rst quarter of 2021 as part of the sale-and-leaseback transaction for the northern part of
the Munich site carried out in 2019, as well as to improved net working capital.

Free cash flow in the first nine months of 2021 amounted to 297.0 million, up 128.5 million on the prior-year level ( 168.5 mil-
lion). This is mainly attributable to the higher cash flow from operating activities as well as to slightly lower disbursements for
investments in intangible assets and property, plant and equipment.

CURRENT AND NON-CURRENT ASSETS

million Sept. 30, 2021 Dec. 31, 2020

Intangible assets and goodwill 986.9 887.8
Property, plant and equipment 1,618.1 1,544.7
Other non-current assets 444.6 360.1
Non-current assets 3,049.6 2,792.6
Inventories 1,009.4 844.6
Trade accounts receivable 1,424.8 1,141.1
Other financial assets 38.7 39.8
Contract assets 83.7 84.2
Cash and cash equivalents 1,640.6 2,277.0
Other current assets 179.5 210.5
Current assets 4,376.6 4,597.3

A seasonal increase compared with December 31, 2020 was recorded in trade accounts receivable. In this regard as in previous
years we expect a noticeable improvement by year end. Furthermore, the trend in inventories reflects, among other things,
measures to preserve the global supply chains.

Overall, net working capital in absolute terms decreased slightly by 59.2 million to 1,121.8 million compared with the first
nine months of 2020 ( 1,181.1 million). The commitment in revenue days improved by 9.0 days to 60.5 days and was thus mark-
edly below the prior-year level (69.5 days).
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

CAPITAL EXPENDITURE

Nine Months
2021 2020
Capital expenditure (before IFRS 16 and acquisitions) million 212.0 230.0
Capital expenditure as % of revenues % 4.2 5.0

Investments in intangible assets and property, plant and equipment decreased moderately compared with the previous year.
The comparatively high capital expenditure as a percentage of revenues in the previous year was due to the low sales volume
owing to Covid-19. Major investments were made in forward-looking research and development projects in the first nine months
of 2021, including in the areas of automated driving and the further development of the steering systems business and electrifi-
cation. Furthermore, investments were made for expanding the capacity of high-growth product groups and for automation
projects.

CONSOLIDATED EQUITY

million Sept. 30, 2021 Dec. 31, 2020

Subscribed capital 161.2 161.2
Other equity 1,970.3 1,669.5
Equity attributable to the shareholders 2,131.5 1,830.7
Non-controlling interests 90.6 91.0
Total equity 2,222.0 1,921.7

As of September 30, 2021, the Knorr-Bremse Group had an equity ratio of 29.9%. The increase compared with December 31, 2020
(26.0%) was mainly due to a higher earnings contribution.

CURRENT AND NON-CURRENT LIABILITIES

million Sept. 30, 2021 Dec. 31, 2020

Provisions (incl. pensions) 599.4 641.3
Financial liabilities 1,211.3 1,158.7
Other non-current liabilities 222.9 176.2
Non-current liabilities 2,033.6 1,976.2
Trade accounts payable 1,112.5 1,027.7
Financial liabilities 1,411.8 1,818.2
Contract liabilities 283.5 295.9
Other liabilities 362.8 350.3
Current liabilities 3,170.6 3,492.1
Total liabilities 5,204.2 5,468.3

There were significant changes in financial liabilities compared with December 31, 2020, especially in liabilities to banks. Overall,
September 30, 2021. This reduction is due primarily to the repayment in full in the first
-19 action program. By contrast, other financial
liabilities and lease liabilities increased. Moreover, there was a growth-related

The following debt financing existed as of September 30, 2021:

Corporate bond of Knorr- 500.0 million (maturing in December 2021)

Corporate bond of Knorr- 750.0 million (maturing in June 2025)
Bank liabilities of Knorr-Bremse Group in the amount of 115.2 million
Leases liabilities in the amount of 426.3 million.
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

EMPLOYEES

AVERAGE NUMBER OF EMPLOYEES

Nine Months

2021 2020
Wage earners 15,741 14,694
thereof leased personnel 2,819 2,381
Salaried employees 14,387 13,906
thereof leased personnel 227 216
Trainees 221 200
Total 30,349 28,800

At the end of September 2021, the Group had an average of 30,349 employees (previous year: 28,800). The figures relate to full-
time equivalents (FTE). The moderate increase (54%) compared with the corresponding prior-year period was mainly attributable
to the significant sales growth in the Commercial Vehicle Systems segment and was seen here primarily in production. In the Rail
Vehicle Systems segment, the average number of employees rose only slightly and was attributable in part to the acquisition of
the EVAC Group with 105 employees and to a strategic development for forward-looking topics, including in the R&D area.
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

INFORMATION ON REPORTABLE SEGMENTS

REVENUES BY SEGMENT

Nine Months
million 2021 2020
Rail Vehicle Systems 2,483.0 2,580.6
Commercial Vehicle Systems 2,567.5 2,046.0
Total (HGB) 5,050.6 4,626.7
Reconciliation to IFRS (Rail Vehicle Systems) (23.3) (18.1)
Reconciliation to IFRS (Commercial Vehicle Systems) (18.1) (19.8)
Other segments and consolidation (1.0) 0.5
Group 5,008.1 4,589.3

EBT BY SEGMENT

million 2021 2020

Rail Vehicle Systems 404.8 451.3
Commercial Vehicle Systems 238.2 113.4
Total (HGB) 643.0 564.7
Reconciliation to IFRS (Rail Vehicle Systems) 19.8 7.1
Reconciliation to IFRS (Commercial Vehicle Systems) 50.8 31.7
Other segments and consolidation (37.4) (54.4)
Group 676.2 549.1

Our two segments performed as follows in the first nine months of 2021:

RAIL VEHICLE SYSTEMS SEGMENT

Nine Months Third Quarter

2021 2020 2021 2020
Revenues million 2,459.7 2,562.5 805.1 821.7
thereof aftermarket % 45 44 45 44
EBITDA million 531.6 568.1 170.9 177.9
EBITDA margin % 21.6 22.2 21.2 21.6
Operating EBITDA margin % 21.7 22.2 21.6 21.6
EBIT million 439.8 472.0 138.9 146.3
EBIT margin % 17.9 18.4 17.3 17.8
Operating EBIT margin % 18.0 18.4 17.6 17.8
Incoming orders million 2,189.7 2,390.0 739.2 725.7
Order book (September 30) million 3,451.4 3,400.5 3,451.4 3,400.5

Incoming orders in the Rail Vehicle Systems segment fell by a total of 200.3 million year-on-year, partly due to the impact of
Covid-19 and to postponements of projects, and resulting in an order intake of 2,189.7 million as of the end of September 2021
(previous year: 2,390.0 million). After Europe, the Asian market and here in particular the Chinese business was the hardest
hit. By contrast, the order book as of September 30, 2021 rose by 1.5% to 3,451.4 million (previous year: 3,400.5 million),
buoyed by the high order volume in the fourth quarter of 2020.

Revenues in the Rail Vehicle Systems segment came to 2,459.7 million in the first nine months of 2021, down by -4.0% com-
pared with the previous year. In addition to a decrease in OE revenues, this also stemmed from slightly lower aftermarket reve-
nues. In Europe, a decline in revenues from mass transit (metro cars and light rail vehicles) and locomotives was offset by growth
in the business for high-speed trains and regional & commuter. The year-on-year drop in OE revenues in North America was
attributable to the regional & commuter business and to the freight business. Declining OE revenues in Asia were due to the
Chinese high-speed trains and metro cars business, but also to the railway carriage business in India, and were offset only in part
by growth in regional & commuter and light rail vehicles. At 44.7%
slightly 44.1%), with moderate growth in Europe being offset by decreases in aftermarket
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

revenues in the Chinese and American markets, which was due in part to extended overhaul cycles for trains in China. The acqui-
17.5 million to revenues as of September 2021.

Owing to volume and mix factors, operating EBIT at 443.0 million as of September 2021 was down -6.1% on the prior-year level
( 472.0 million), giving an operating EBIT margin (ROS) of 18.0%, moderately below the preceding year (18.4%). The division
benefited among other things from the cost-cutting program launched in the previous year, which had a stabilizing effect. Op-
erating EBITDA at 534.7 million was also down moderately by -5.9% on the prior-year figure of 568.1 million due to volume
and mix factors, giving an operating EBITDA margin of 21.7% of revenues as of September 2021 (previous year: 22.2%). To deter-
mine operating earnings figures (EBIT/EBITDA, also as a percentage of revenues), the above-mentioned restructuring expenses
in North America were adjusted by 3.1 million against the reported earnings figures.

COMMERCIAL VEHICLE SYSTEMS SEGMENT

Nine Months Third Quarter

2021 2020 2021 2020
Revenues million 2,549.4 2,026.3 784.5 711.6
thereof aftermarket % 26 28 29 27
EBITDA million 399.8 259.8 119.4 101.6
EBITDA margin % 15.7 12.8 15.2 14.3
Operating EBITDA margin % 15.7 12.8 15.2 14.3
EBIT million 298.7 158.0 84.8 63.8
EBIT margin % 11.7 7.8 10.8 9.0
Operating EBIT margin % 11.7 7.8 10.8 9.0
Incoming orders million 2,849.7 1,962.6 696.7 902.0
Order book (September 30) million 1,569.3 1,070.6 1,569.3 1,070.6

The order intake in the Commercial Vehicle Systems segment at 2,849.7 million for the first nine months of 2021 was very sig-
nificantly up by 45.2% on the corresponding prior-year period fueled by a global market recovery that benefited all regions. Here,
the positive development of the order situation was boosted by the high level in the first half of 2021. In the third quarter of 2021,
persistent supply bottlenecks for the entire commercial vehicle industry led to reduced production volumes for commercial ve-
hicle manufacturers and thus to postponements and declining order intake, particularly in Europe and North America. The
Asia/Pacific region likewise registered diminishing orders in the third quarter of 2021 after a new emissions standard in China
had previously led to pull-forward effects. The significant overall growth in incoming orders in the first nine months of the fiscal
year was also reflected positively in the order book, which as of September 30, 2021 was very significantly up by 46.6% on the
corresponding prior-year figure and remained at a high level.

At 2,549.4 million as of the end of September 2021, revenues were down by a significant 25.8% on the same period of the
previous year. Despite the aforementioned supply bottlenecks throughout the commercial vehicle industry, the growth in reve-
nues year-on-year was largely attributable to an increase in the number of trucks being produced worldwide and related revenue
growth in the OE business, mainly in the core markets of North America and Europe and in Asia/Pacific, particularly in China. The
aftermarket share of revenues also saw marked growth, especially in the German and North American markets. However, the
share of aftermarket revenue in the Commercial Veh 25.7% as of September 2021
compared with the previous year (28.3%) despite the growth in the aftermarket business, as a result of the even stronger rise in
OE revenues.

Operating and reported EBIT in the Commercial Vehicle Systems segment jumped by as much as 89.1% to 298.7 million as of
the end of September 2021. This increased the EBIT margin (ROS) to 11.7%, a very significant margin improvement of 390 basis
points compared with the previous year (7.8%) thanks to the positive operating leverage. The marked growth in revenues at the
same time as consistent continuation of the cost control measures we implemented led to an improvement in probability despite
increased freight and procurement costs. Reported and operating EBITDA was also up a very significant 53.8% to 399.8 million
on the same period of the prior year ( 259.8 million), giving a EBITDA margin of 15.7% as of September 2021 (previous year:
12.8%).
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

REVENUE BY COUNTRY OF KNORR-BREMSE COMPANY

Nine Months Third Quarter

million 2021 2020 2021 2020
Europe/Africa 2,375.1 2,082.1 765.7 709.2
North America 1,041.1 935.7 334.8 323.0
South America 88.0 53.9 33.5 18.8
Asia-Pacific 1,503.9 1,517.5 455.2 482.5
5,008.1 4,589.3 1,589.2 1,533.5

As of the end of September 2021, 47% 45%), 21% to

North America (previous year: 20%), 2% to South America (previous year: 1%), and 30% to Asia/Pacific (previous year: 33%).
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

SIGNIFICANT EVENTS IN THE REPORTING PERIOD

Explanations of the significant events in the course of business can be found in the notes to the condensed interim consolidated
financial statements as of June the reporting

section of the notes, is one of the significant events in the reporting period.

EVENTS AFTER THE REPORTING DATE

Changes in the Executive Board

Dr. Peter Laier, member of the Executive Board of Knorr-Bremse AG and globally responsible for the Commercial Vehicle Systems
division (CVS), is to resign from the Executive Board at his own request with effect from December 31, 2021, in order to pursue
new professional perspectives. The Supervisory Board of Knorr-Bremse AG has initiated the search for a successor. The division
will be managed on an interim basis by the CEO Dr. Jan Mrosik from January 1, 2022.

Final purchase price payment for Bendix Spicer Foundation Brake LLC
ix
Spicer Foundation Brake LLC as of December 31, 2020 was settled in full as of October 1, 2021.

Stake taken in Israeli start-up Autobrains

Knorr-Bremse acquired a minority shareholding of 5.72% in the Israeli start-
The company provides video object recognition based on self-learning artificial intelligence (AI) to facilitate system solutions for
-learning AI technology has the potential to significantly
shape ADAS and HAD development in the commercial vehicle industry. It needs less data and computing power, enabling sig-
nificant reductions in development times and costs. The collaboration will complement the existing partnership between Knorr-
Bremse and Continental with regard to radar and camera systems for driver assistance systems and automated driving.

OUTLOOK

We have narrowed our guidance for revenues, EBIT and EBITDA based on advanced business performance and compared with
the assessment of the trends in the key performance indicators made in the 2020 Annual Report. Knorr-Bremse now expects
6, 6,800 million (2020 ,157 million) versus 6,500 6,900 million previously, an operating EBIT
margin of between 13.0% and 13.5% (2020: 13.2%) versus 13.0% to 14.5% previously, and an operating EBITDA margin of be-
tween 17.5% and 18.0% (2020: 18.0%) versus 17.5% to 19.0% previously. All other key financial performance indicators are ex-
pected to develop as previously forecast.
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

CONSOLIDATED STATEMENT OF INCOME

CONSOLIDATED STATEMENT OF INCOME

Nine Months
2021 2020
Revenues 5,008,139 4,589,311
Change in inventory of unfinished/finished products 70,161 7,608
Own work capitalized 59,889 56,944
Total operating performance 5,138,189 4,653,863
Other operating income 70,564 76,166
Cost of materials (2,563,369) (2,204,741)
Personnel expenses (1,227,458) (1,144,028)
Other operating expenses (501,591) (577,079)

Earnings before interest, tax, depreciation and amortization (EBITDA) 916,335 804,180
Depreciation, amortization and impairment (207,795) (212,074)
Earnings before interest and taxes (EBIT) 708,540 592,107
Interest income 12,070 14,000
Interest expenses (37,241) (35,801)
Other financial result (7,159) (21,202)
Income before taxes 676,210 549,104
Taxes on income (180,054) (151,648)
Net income 496,156 397,456

Thereof attributable to:

Profit (loss) attributable to non-controlling interests 16,933 28,269

Profit (loss) attributable to the shareholders of Knorr-Bremse AG 479,223 369,187

basic 2.97 2.29

diluted 2.97 2.29
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

CONSOLIDATED BALANCE SHEET

CONSOLIDATED BALANCE SHEET

Sept. 30, 2021 Dec. 31, 2020

Assets
Intangible assets 574,156 491,595
Goodwill 412,779 396,174
Property, plant and equipment 1,618,136 1,544,731
Investments accounted for using the equity method 23,043 24,663
Other financial assets 195,938 140,786
Other assets 75,341 57,276
Income tax receivables 1,704
Assets from employee benefits 22,032 20,995
Deferred tax assets 126,512 116,416
Non-current assets 3,049,641 2,792,636

Inventories 1,009,415 844,590

Trade accounts receivable 1,424,754 1,141,139
Other financial assets 38,732 39,828
Other assets 137,953 161,793
Contract assets 83,656 84,217
Income tax receivables 41,509 48,714
Cash and cash equivalents 1,640,585 2,277,048
Current assets 4,376,604 4,597,329

Total assets 7,426,245 7,389,965

KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

CONSOLIDATED BALANCE SHEET

Sept. 30, 2021 Dec. 31, 2020

Equity
Subscribed capital 161,200 161,200
Capital reserves 13,884 13,884
Retained earnings 13,300 13,300
Other components of equity (250,934) (317,579)
Profit carried forward 1,714,824 1,464,349
Profit attributable to the shareholders of Knorr-Bremse AG 479,223 495,499
Equity attributable to the shareholders of Knorr-Bremse AG 2,131,497 1,830,653
Equity attributable to non-controlling interests 90,550 91,008
thereof share of non-controlling interests in net income 16,933 36,672
Equity 2,222,047 1,921,661

Liabilities
Provisions for pensions 327,586 354,887
Provisions for other employee benefits 18,735 17,437
Other provisions 253,087 269,010
Financial liabilities 1,211,273 1,158,737
Other liabilities 4,284 3,490
Income tax liabilities 71,355 58,194
Deferred tax liabilities 147,297 114,482
Non-current liabilities 2,033,617 1,976,237

Provisions for other employee benefits 18,877 19,172

Other provisions 195,440 194,015
Trade accounts payable 1,112,523 1,027,682
Financial liabilities 1,411,799 1,818,194
Other liabilities 85,998 90,287
Contract liabilities 283,467 295,868
Income tax liabilities 62,476 46,849
Current liabilities 3,170,580 3,492,067
Liabilities 5,204,197 5,468,304
Total equity and liabilities 7,426,244 7,389,965
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

CONSOLIDATED STATEMENT OF CASH FLOWS

CONSOLIDATED STATEMENT OF CASH FLOWS

Nine Months
2021 2020
Net income (including minority interests) 496,156 397,456
Adjustments for
Depreciation, amortization and impairment losses on intangible assets and property, plant and equipment 207,795 212,074
Change of impairment on inventories 1,982 11,562
Change of impairment on trade accounts receivable and contract assets 14,755 13,130
Loss on the sale of consolidated companies and other business units 111
(Gain)/loss on the disposal of fixed assets (1,570) 2,165
Adding to, reversing and discounting provisions 64,967 132,304
Non-cash changes in the measurement of derivatives 34,364 15,983
Other non-cash expenses and income (1,607) (15,821)
Interest result 25,171 21,800
Investment result 566 (584)
Income tax expense 180,054 151,648
Income tax payments (128,776) (66,126)
Changes of

Inventories, trade accounts receivable and other assets which cannot be allocated to investing or financing activities (386,296) (386,696)

Trade accounts payable as well as other liabilities which cannot be allocated to investing or financing activities 66,134 13,416
Provisions due to utilization (84,996) (133,031)
Cash flow from operating activities 488,700 369,393

Proceeds from the sale of intangible assets 888 15,055

Disbursements for investments in intangible assets (77,283) (88,217)
Proceeds from the sale of property, plant and equipment 16,476 11,464
Disbursements for investments in property, plant and equipment (131,758) (139,155)
Proceeds from financial investments and from the sale of investments 7,037 1,747
Disbursements for investments in financial assets (69,707) (2,997)
Proceeds from the sale of consolidated companies and other business units 552
Disbursements for the acquisition of consolidated companies and other business units (86,905) (125,911)
Interest received 6,976 7,651
Disbursements for investments in plan assets (pensions) (2,454) (2,710)
Cash flow from investing activities (336,730) (322,523)

Proceeds from borrowings 36,694 773,074

Disbursements from the repayment of borrowings (522,840) (119,700)
Disbursements for lease liabilities (43,933) (44,751)
Interest paid (29,068) (16,295)
Dividends paid to parent company shareholders (245,024) (290,160)
Dividends paid to non-controlling interests (23,684) (45,924)
Net payments from factoring (15,356)
Disbursement from the settlement of derivatives (301)
Proceeds from grants and subsidies 6,362 6,429
Cash flow from financing activities (821,794) 247,317

Cash flow changes in cash funds (669,825) 294,187

Change in cash funds resulting from exchange rate and valuation-related movements 38,136 (38,099)
Change in cash funds resulting from changes to the group structure
Change in cash funds (631,689) 256,088

Cash funds at the beginning of the period 2,240,725 1,853,464

Cash funds at the end of the period 1,609,036 2,109,553

Cash and cash equivalents 1,640,585 2,131,637

Short-term securities available for sale 2 2
Short-term liabilities to banks (less than 3 months) (31,551) (22,084)
KNORR-BREMSE QUARTERLY STATEMENT JANUARY 1 TO SEPTEMBER 30, 2021

This interim report contains statements regarding future developments which can represent forward-looking statements. Such
statements are to be recognized in terms, among others, such as "expect", "anticipate" and their negation and similar variations
or comparable terminology. These statements just as every business activity in a global environment are always associated
with uncertainty. These statements are based on convictions and assumptions of the management board of Knorr-Bremse AG,
which in turn are based on currently-available information. The following factors could affect the success of our strategic and
operational measures: macroeconomic or regional developments, changes in the general economic conditions, especially a con-
tinuing economic recession, changes in exchange rates and interest rates, changes in energy prices and material costs, insuffi-
cient customer acceptance of new Knorr-Bremse products or services, including growing competitive pressure. Should these
factors or other uncertainties arise, or the assumptions underlying the statements turn out to be incorrect, the actual results can
vary from the forecast results. Knorr-Bremse assumes no obligation and does not intend to continually update or correct forward-
looking statements and information. They relate to the conditions as of the date of their publication.

This document contains supplementary financial figures not precisely defined in the relevant financial reporting framework
which represent or could represent so-called alternative performance indicators. For the assessment of the net assets, financial
position and results of operations of Knorr-Bremse, these supplementary financial figures should not be used in isolation or as
alternatives to the financial figures presented in the consolidated financial statements and determined in accordance with the
relevant financial reporting framework. Other companies which present or report performance figures with similar designations
may calculate these differently. Due to rounding, it is possible that individual figures in this and other documents do not add up
exactly to the reported total and that reported percentages do not reflect the absolute values to which they relate.

This document is a quarterly report pursuant to Section 53 of the Stock Exchange Regulations issued by the Frankfurt Stock
Exchange.