Corporate News

Daldrup & Söhne AG concludes further agreement with IKAV Invest S.à r.l.

- Group liquidity increased by € 2.86 million, successive investments in operating business planned

- Technology change on the part of the new shareholder of the Taufkirchen power plant leads to an extraordinary burden on earnings of approx. € 5.7 million.

- AG forecast 2020 before extraordinary valuation effect achieved with positive operating EBIT of € 0.9 million and total output of approx. € 44 million

- Group forecast for 2020 before extraordinary valuation effect is just missed with positive operating EBIT of around € 0.7 million

Oberhaching / Ascheberg, 11 February 2021 - Daldrup & Söhne AG (ISIN DE0007830572) has concluded a further agreement with the IKAV Group, represented by the Luxembourg-based IKAV Invest S.à r.l.. The core of the agreement is the conditional acquisition of subordinated claims by IKAV, which will lead to a total inflow of liquidity of around EUR 2.86 million in the Daldrup Group. The funds increase the liquidity and will be successively invested, among other things, in the expansion of the drilling capacities and in the strengthening of the core business. After the reduction of the subordinated loans and other receivables from the previous power plant companies, these will in future have a volume of around 6.3 million euros, some with maturities until January 2027.

Adjustment of the forecast 2020
From today's point of view, the agreement and the intended replacement of the previously installed technology of the power plant in Taufkirchen on the part of the new shareholder will lead to an extraordinary, non-cash-flow-effective burden on earnings in the Daldrup Group and in Daldrup & Söhne AG of approximately 5.7 million euros on balance.
The Group forecast for the 2020 business year is adjusted from a margin of 2 % to 4 % to an overall negative Group EBIT of around 5.1 million euros, taking into account the extraordinary burden on earnings at the operating EBIT level, and the forecast for Daldrup & Söhne AG is adjusted to a negative EBIT of around 4.9 million euros. Without the extraordinary valuation effect from the technology conversion on the part of the new shareholder, the Group would probably report a positive operating EBIT of around 0.7 million euros for the 2020 financial year, the AG of 0.9 million euros. This means that only the Group falls just short of the lower value of the forecast operating EBIT margin corridor. The forecast of at least 40 million euros of total output for the group and for Daldrup & Söhne AG will be exceeded by around 4 million euros as of today.

Both the individual financial statements of the AG and the consolidated financial statements will continue to show solid balance sheet equity ratios of 45 % of the balance sheet total despite this burden on earnings as of 31 December 2020, also due to the planned decline in debt. All of the above-mentioned values are still subject to confirmation by the mandated auditors as part of the audit of the annual and consolidated financial statements for 2020, which has already begun.

CFO Stephan Temming comments on the classification of the result: "The value adjustments to be made are ultimately part of the power plant history since 2013. They are not related to the current operating development of the Daldrup Group and do not affect liquidity. Above all, however, the agreement with IKAV is a further building block of the strategic orientation towards drilling services and geothermal heat projects as well as for the significant strengthening of the Group's financing. Despite the Corona pandemic, the operative business of Daldrup & Söhne AG is running well overall in line with expectations. We expect to close the 2020 financial year at the level of the AG within the forecast with a positive EBIT result from the operating business. The prospects for our company are promising with the structural growth topics of the heat transition and climate change, as well as in the special drilling segment for the search for a final storage facility in Europe, among others. In the coming months, we will continue to use our good market position and know-how to retain existing customers and acquire new ones. Our order pipeline, defined as the total order volume of around 110 million euros, evaluated with probabilities of occurrence and currently under negotiation, offers us an excellent starting position for this."

About Daldrup & Söhne AG
Daldrup & Söhne AG (ISIN: DE0007830572, WKN: 783057) with a corporate history spanning more than 70 years is a specialist provider of drilling and environmental services and ranks as one of the leading companies in Germany. Its activities are divided into the business divisions Geothermics, Raw Materials & Exploration, Water Extraction as well as Environment, Development & Services (EDS). The Geothermics business division provides drilling services for near-surface geothermics (especially geothermal probes of heat pumps), along with drilling services for deep geothermics up to 6000 m, in order to utilise the geothermal energy accessible in this way for electricity and/or heat generation. In the Raw Materials and Exploration business division, the bores made by Daldrup & Söhne AG serve for exploring and developing fossil fuel deposits (especially coal and gas) as well as mineral resources and ores (e.g. copper and gold). The Water Extraction business division comprises well construction for the extraction of drinking, service, curative, mineral, boiler-feed or cooling water as well thermal brine. The Environment, Development & Services (EDS) business division comprises special environmental engineering services such as the hydraulic clean-up of contaminated sites, the drilling of gas extraction wells for recovering waste dump gas, the provision of groundwater quality measuring points or the installation of water purification plants.

The shares of Daldrup & Söhne AG are listed in the Scale (sub-segment in the open market of the Frankfurt Stock Exchange).

Disclaimer
This publication represents neither an offer for sale nor a call to submit a tender for the purchase or underwriting of securities. This publication and the information it contains is not intended for direct or indirect dissemination in or within the United States of America ("USA"), Canada, Australia or Japan.

Press & Investor Relations contact
Daldrup & Söhne AG
Falk v. Kriegsheim
Fon +49 (0)2593-9593-29
Fax +49 (0)2593-9593-60
Bajuwarenring 17a
82041 Oberhaching