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DGAP-News: GEA Group Aktiengesellschaft
/ Key word(s): Quarterly / Interim Statement/Change in Forecast
GEA Group Aktiengesellschaft: GEA posts increase in order intake and revenue in the third quarter, raising 2019 revenue outlook slightly
25.10.2019 / 07:30
The issuer is solely responsible for the content of this announcement.
GEA posts increase in order intake and revenue in the third quarter, raising 2019 revenue outlook slightly
- Slight increase in 2019 forecast for revenue; outlook for EBITDA before restructuring measures and ROCE confirmed again
- Order intake (EUR 1.25 billion) in Q3 up on the previous year, both for GEA as a whole and for the two Business Areas
- Strong revenue data (EUR 1.23 billion) again in the quarter under review, both for GEA as a whole and the two Business Areas; further growth (8 percent) in service business
- EBITDA before restructuring measures in the quarter (EUR 143 million) slightly below previous year's level (EUR 145 million) due to impact of special effects (around EUR 3 million)
- Net financial position (EUR -263 million) improved by around EUR 70 million compared to the previous year
Düsseldorf, October 25, 2019 - Technology group GEA posted an increase in both order intake and revenue in the third quarter of 2019. Order intake rose to EUR 1.25 billion in the last quarter, an increase of around 5 percent compared to the same quarter in 2018. Both basic business and six large projects (three of which were awarded in dairy processing) contributed to this positive development. At EUR 1.23 billion (4 percent above the previous year's figure), revenue fared equally well, with growth recorded primarily in the Separation, Homogenizers, Flow Components and Compression product groups, as well as in Dairy and Utilities. With an increase of around 8 percent to some EUR 400 million, GEA chalked up healthy year-on-year revenue growth in its high-margin service business, too. These developments gave rise to a book-to-bill ratio (i.e. order intake relative to revenue) of 1.02 for the third quarter of the year. Reflecting the rise in order intake and the positive revenue trend, GEA decided to increase its previous revenue forecast slightly; the company now expects revenue for 2019 as a whole to be on par with previous year (2018: EUR 4.83 billion). A revenue figure slightly below the 2018 level had been postulated in the earlier outlook.
At EUR 143 million, EBITDA before restructuring measures was around 1.4 percent below the previous year's value. With regard to the Business Area Equipment, third-quarter earnings were impacted by disproportionate growth in low-margin product groups, declining margins in new machinery business, and special effects relating to the settlement of a legal dispute. In the Business Area Solutions, conversely, an initiative to optimize project management in dairy processing increased earnings. GEA's accumulated figure for EBITDA before restructuring measures for the first three quarters of the year was around EUR 329 million (previous year: EUR 364 million). All told, special effects impacted earnings in the amount of around EUR 3 million in the quarter under review, and by EUR 47 million over the nine-month period.
Owing to a considerably positive free cash flow, GEA succeeded in improving its net financial position as of September 30, 2019 (EUR -263 million), by almost EUR 70 million compared with the same period of the previous year. ROCE (Return on Capital Employed) for the period ending September 30, 2019, amounted to 10.5 percent (average of the last 4 quarters).
"We're delighted to have countered the trend in the engineering sector by posting an increase in order intake in the third quarter. This, coupled with the positive revenue figure for the first nine months of the year, allowed us to increase our general revenue forecast for 2019 slightly. We're pleased to confirm our outlook for the other key ratios, too - EBITDA before restructuring measures and ROCE," said Stefan Klebert, CEO of GEA Group Aktiengesellschaft. "We can already tell that the efficiency measures in the Business Area Solutions are starting to bear fruit. And as reported, initial measures to streamline our portfolio have been initiated. The next milestones are the official launch of the new organizational structure on January 1, 2020, and the arrival in mid-January of Johannes Giloth as board member for our newly mandated Procurement, Production and Logistics organization."
IFRS Key Figures of GEA
| (EUR million) |
Q3
2019 |
Q3
2018 |
Change
in % |
Q1-Q3
2019 |
Q1-Q3
2018 |
Change
in % |
Results of operations |
 |
 |
 |
 |
 |
 |
| Order intake |
1,254.8 |
1,197.2 |
4.8 |
3,587.8 |
3,682.7 |
-2.6 |
| Book-to-bill ratio |
1.02 |
1.01 |
- |
1.01 |
1.07 |
- |
| Order backlog |
2,435.6 |
2,550.1 |
-4.5 |
2,435.6 |
2,550.1 |
-4.5 |
| Revenue |
1,234.7 |
1,188.9 |
3.9 |
3,539.3 |
3,455.3 |
2.4 |
| EBITDA before restructuring measures1 |
143.1 |
145.2 |
-1.4 |
328.9 |
363.8 |
-9.6 |
| as % of revenue |
11.6 |
12.2 |
- |
9.3 |
10.5 |
- |
| EBITDA (IFRS) |
138.5 |
120.8 |
14.7 |
308.9 |
300.7 |
2.7 |
| EBIT before restructuring measures1 |
93.6 |
92.4 |
1.4 |
178.2 |
211.8 |
-15.9 |
| as % of revenue |
7.6 |
7.8 |
- |
5.0 |
6.1 |
- |
| EBIT (IFRS) |
88.8 |
84.7 |
4.8 |
148.7 |
195.8 |
-24.0 |
| EBT (IFRS) |
81.3 |
78.4 |
3.8 |
141.6 |
172.2 |
-17.8 |
| Profit for the period (IFRS)2 |
59.8 |
60.0 |
-0.3 |
115.4 |
128.5 |
-10.2 |
| ROCE in % (goodwill adjusted)3 |
10.5 |
14.6 |
- |
10.5 |
14.6 |
- |
Net assets |
 |
 |
 |
 |
 |
 |
| Net working capital (reporting date) |
941.1 |
904.4 |
4.1 |
941.1 |
904.4 |
4.1 |
| as % of revenue (LTM) |
19.2 |
18.9 |
- |
19.2 |
18.9 |
- |
| Capital employed (reporting date) |
2,733.5 |
2,576.0 |
6.1 |
2,733.5 |
2,576.0 |
6.1 |
| Equity |
2,379.6 |
2,476.1 |
-3.9 |
2,379.6 |
2,476.1 |
-3.9 |
| Equity ratio in % |
39.6 |
40.5 |
- |
39.6 |
40.5 |
- |
| Leverage4 |
0.6 x |
0.7 x |
- |
0.6 x |
0.7 x |
- |
| Net liquidity (+)/Net debt (-) |
-262.9 |
-330.7 |
20.5 |
-262.9 |
-330.7 |
20.5 |
Financial position |
 |
 |
 |
 |
 |
 |
| Cash flow from operating activities |
117.9 |
48.6 |
> 100 |
110.8 |
-35.8 |
- |
| Cash flow from investing activities |
-28.1 |
-27.8 |
-1.1 |
-76.5 |
-84.9 |
9.9 |
| Free cash flow |
89.8 |
20.7 |
> 100 |
34.3 |
-120.8 |
- |
GEA shares |
 |
 |
 |
 |
 |
 |
| Earnings per share (EUR)2 |
0.33 |
0.33 |
-0.1 |
0.64 |
0.71 |
-10.1 |
| Weighted average number of shares outstanding (million) |
180.5 |
180.5 |
- |
180.5 |
180.5 |
-0.0 |
| Market capitalization (EUR billion; reporting date) |
4.5 |
5.5 |
-19.3 |
4.5 |
5.5 |
-19.3 |
| Employees (FTE; reporting date) |
18,820 |
18,535 |
1.5 |
18,820 |
18,535 |
1.5 |
1) Pro-forma figures for 2018 incl. IFRS 16 effects from 2019.
2) First half of 2019 incl. interest income of EUR 32.7 million due to adjustment of the interest calculation method used to measure provisions for long-term liabilities (see Half-yearly Financial Report 2019, page 36).
3) Capital employed excluding goodwill from the acquisition of the former GEA AG by former Metallgesellschaft AG in 1999 (average of the last 4 quarters); pro-forma figures for 2018 incl. IFRS 16 effects from 2019.
4) Total net debt / cons. EBITDA based on frozen GAAP (covenant concept). |
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About GEA
GEA is one of the largest suppliers for the food processing industry and a wide range of other industries that generated consolidated revenues of approximately EUR 4.8 billion in 2018. The international technology group specializes in machinery, and plants as well as process technology and components. GEA provides sustainable energy solutions for sophisticated production processes in various end-user markets and offers a comprehensive service portfolio. The group generates around 70 percent of its revenue in the food and beverages sector that enjoys long-term sustainable growth. As of December 31, 2018, the company employed about 18,500 people worldwide. GEA is a market and technology leader in its business areas. The company is listed on the German MDAX (G1A, WKN 660 200), the STOXX(R) Europe 600 Index and selected MSCI Global Sustainability Indexes. Further information is available on the Internet at .
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Contact
GEA Group Aktiengesellschaft
Phone +49 (0)211 9136 1081
Fax +49 (0)211 9136 31087
gea.com
25.10.2019 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
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