GEA continues positive performance in second quarter; outlook confirmed

• Order intake up 8.5 percent (organic: +6.7 percent) to EUR 1.40 billion (Q2 2021: EUR 1.29 billion)
• Revenue growth of 10.0 percent (organic: +8.9 percent) to EUR 1.27 billion
  (Q2 2021: EUR 1.16 billion)
• EBITDA before restructuring expenses up 9.0 percent to EUR 167 million (Q2 2021: EUR 154 million); corresponding EBITDA margin remains at high level of 13.2 percent (Q2 2021: 13.3 percent)
• ROCE increased to 29.7 percent (Q2 2021: 21.4 percent)
• Net working capital as percentage of revenue improved to 7.9 percent (Q2 2021: 8.3 percent); significant growth in net liquidity to EUR 264 million (Q2 2021: EUR 203 million)
• Outlook for 2022 fiscal year confirmed
• GEA links Group financing to sustainability strategy

Düsseldorf, August 10, 2022 - GEA’s positive performance at the beginning of the year continued in the second quarter, with further improvement in its key financial indicators. Order intake rose by 8.5 percent to EUR 1.40 billion. Revenue climbed by 10 percent to EUR 1.27 billion. All divisions contributed to the organic revenue growth of 8.9 percent. EBITDA before restructuring expenses grew by 9 percent to EUR 167 million. The corresponding EBITDA margin remains at a high level of 13.2 percent despite the negative impact of the global supply chain issues and the war in Ukraine. Return on capital employed (ROCE) climbed to 29.7 percent while net working capital as a percentage of revenue improved to 7.9 percent and net liquidity rose significantly to EUR 264 million.

According to CEO Stefan Klebert: “Thanks to a solid performance in the second quarter, GEA is on track for continued profitable growth. In addition, we implemented appropriate measures at an early stage to prepare GEA for the uncertain economic situation. We therefore confirm our outlook for 2022.”

Robust order intake and revenue growth

In the second quarter of 2022, order intake rose by 8.5 percent to EUR 1,403 million (Q2 2021: EUR 1,294 million). Two large orders (orders with a volume of over EUR 15 million each) totaling EUR 52 million from the German-speaking and Asian regions contributed to this development. In addition, the Dairy Farming, Dairy Processing and New Food customer industries experienced strong demand. Organic growth came to 6.7 percent.

Revenue rose by 10.0 percent in the reporting period to EUR 1,271 million (Q2 2021: EUR 1,156 million). Organic revenue increased by 8.9 percent, the strongest quarterly rise in 10 years. This growth is attributable in particular to the Dairy Farming, Chemical and Food customer industries. The share of service revenue increased by 0.8 percentage points to 34.6 percent in the second quarter of 2022
(Q2 2021: 33.8 percent).

Key financial indicators further improved

EBITDA before restructuring expenses increased by 9 percent to EUR 167.4 million in the second quarter (Q2 2021: EUR 153.7 million). The corresponding EBITDA margin remains at a high level of 13.2 percent (Q2 2021: 13.3 percent), despite the negative impact of the global supply chain issues and the war in Ukraine. The increase in gross profit more than compensated for the offsetting effects resulting from divestments as well as higher travel and personnel expenses.

At EUR 76.7 million, profit for the period remained at the prior-year level (Q2 2021: EUR 76.9 million). The positive operating performance was impacted notably by higher restructuring expenses of around EUR 20 million related to the optimization of production sites. Earnings per share therefore remained unchanged at EUR 0.43. Before restructuring expenses, however, earnings per share were up on the prior-year figure of EUR 0.48, at EUR 0.53.

Net liquidity improved to EUR 263.7 million as of June 30, 2022, compared with EUR 202.8 million in the prior-year period. This increase was due in particular to the significant improvement in earnings. Net working capital as a percentage of revenue amounted to 7.9 percent compared with 8.3 percent in the previous year. Return on capital employed (ROCE) climbed to 29.7 percent from to 21.4 percent in the previous year. All divisions contributed to this development, with some recording significant growth in ROCE.

First half of 2022 at a glance

In the first six months of the current fiscal year, order intake rose by a significant
14.4 percent (organic: 13.5 percent) to EUR 2,947 million (previous year: EUR 2,576 million). Revenue rose by 7.9 percent in the first half of the year (organic: 7.8 percent) to EUR 2,397 million (previous year: EUR 2,221 million). The service business accounted for 35.4 percent of total revenue (previous year: 34.5 percent). EBITDA before restructuring expenses improved by 11.2 percent to EUR 305.7 million (previous year: EUR 274.8 million). The corresponding EBITDA margin improved by 0.4 percentage points to 12.8 percent (previous year: 12.4 percent). Profit for the period rose by 11.4 percent to EUR 148.9 million in the first half of the year (previous year: EUR 133.6 million). Earnings per  share rose accordingly from EUR 0.74 to EUR 0.84.

Outlook for 2022 confirmed

GEA has confirmed its outlook for fiscal year 2022. Revenue is forecast to grow on an organic basis by more than 5 percent. EBITDA before restructuring expenses at constant exchange rates is expected to be in a range between EUR 630 million and 690 million. For ROCE, the company anticipates a figure between 24 and 30 percent (at constant exchange rates).

GEA links Group financing to sustainability strategy

The second tranche of the share buyback program adopted in 2021 was launched on July 6, 2022. This tranche comprises a repurchase volume of EUR 170 million and includes an ‘ESG feature:’ GEA has entered into a three-year partnership with Viva con Agua, a non-profit organization dedicated to safeguarding access to clean drinking water. Based on the guaranteed outperformance of the GEA share buyback program, GEA will donate EUR 250,000 to a drinking water project in Africa this year, in line with the company’s sustainability strategy. GEA is the first company in Germany to combine a share buyback with a sustainability initiative.

In addition, GEA added ESG components to its syndicated credit facility of EUR 650 million in April, linking the mechanism for setting the margin to the performance of sustainability indicators. The measurement of sustainability target attainment will be carried out for the first time on the basis of calendar year 2022 and will continue until the end of 2026. The agreed sustainability indicators are based among other factors on the targets for reducing greenhouse gas emissions from the company’s own activities (Scope 1 and 2) as well as the proportion of female managers in the top three management levels.

GEA Key Financial Figures

Media Relations

Anne Putz

Peter-Müller-Str. 12, 40468 Düsseldorf, Germany

Phone +49 211 9136-1500

anne.putz@gea.com

About GEA

GEA is one of the world's largest suppliers of systems and components to the food, beverage, and pharmaceutical industries. The international technology­ group, founded in 1881, focuses on machinery and plants, as well as advanced process technology, components, and comprehensive services. With more than 18,000 employees working across five divisions and
62 countries, the group generated revenues of more than EUR 4.7 billion in fiscal year 2021. GEA plants, processes, components, and services enhance the efficiency and sustainability of production processes across the globe. They contribute significantly to the reduction of CO₂ emissions, plastic usage, and food waste. In doing so, GEA makes a key contribution toward a sustainable future, in line with the company’s purpose: "Engineering for a better world".

GEA is listed in the German MDAX and the STOXX^® Europe 600 Index and is also among the companies comprising the DAX 50 ESG and MSCI Global Sustainability Indices.

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