Gea Group Aktiengesellschaft · XETR:G1A
Gea Group Aktiengesellschaft — GEA Group — FY 2022 Earnings Presentation
58 slides from Gea Group Aktiengesellschaft's earnings presentation, Mar 7, 2023
Slide 1: FY/Q4 2022 Results
FY/Q4 2022 Results Stefan Klebert, CEO Marcus A. Ketter, CFO Johannes Giloth, COO Düsseldorf, March 7, 2023
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements. Forward-looking statements may include, in particular, statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. Statements wit
Slide 3: Highlights FY 2022
Highlights FY 2022 Stefan Klebert, CEO FY/Q4 2022 Results 3
Slide 4: GEA accelerated profitable growth further in FY 2022
GEA accelerated profitable growth further in FY 2022 FY 2022 FY 2021 ∆ YoY Order Intake €5,679m €5,222m +8.7% +7.6% organic Sales €5,165m €4,703m +9.8% +8.9% organic EBITDA1 €712m +14.0% margin 13.8% +0.5%p ROCE1,2 31.8% +3.9%p Proposed dividend increase from €0.90 to €0.95 per share. 1 Before restr
Slide 5: … and overachieved targets set in 2019 for 2022
… and overachieved targets set in 2019 for 2022 2019-2022 Organic Sales CAGR 3.4% EBITDA Margin FY22 13.8% FY/Q4 2022 Results 5
Slide 6: …based on overachievement on divisional levels
…based on overachievement on divisional levels 2022 13.8% 11.6% 10.9% 9.7% 10.7% 25.4% FY/Q4 2022 Results 6
Slide 7: The workstreams are in full swing of implementing Mission 26
The workstreams are in full swing of implementing Mission 26 Innovation & Sustainability New Food Sales Excellence Digitalization ▪ Significant improvement in ESG ▪ Sales share of new products: 14% ▪ 2% of FY22 sales ▪ Organic new machines sales Ratings in 2022 growth of 7.4% in FY22 ▪ Some examples
Slide 8: ESG Highlights
ESG Highlights Achievements Following the December 2022 annual index In November 2022, GEA received In 2023, GEA was In January 2023, GEA was upgraded an ESG Risk Rating of 18.3 and from ‘AA’ to ‘AAA’ in the MSCI ESG review, GEA became a constituent of the recognized by was assessed by Sustainalytic
Slide 9: Manure Enricher – sustainable farming
Manure Enricher – sustainable farming Produce your own fertilizer while reducing emissions ✓ No methane emissions from manure storage ✓ Reduces ammonia emissions and eliminates smell ✓ Enables local production of Plasma technology nitrogen enriched fertilizer enriches manure Nitrogen enriched with n
Slide 10: The workstreams are in full swing of implementing Mission 26
The workstreams are in full swing of implementing Mission 26 Innovation & Sustainability New Food Sales Excellence Digitalization ▪ Significant improvement in ESG ▪ Sales share of new products: 14% ▪ 2% of FY22 sales ▪ Organic new machines sales Ratings in 2022 growth of 7.4% in FY22 ▪ Some examples
Slide 11: The workstreams are in full swing of implementing Mission 26
The workstreams are in full swing of implementing Mission 26 Innovation & Sustainability New Food Sales Excellence Digitalization ▪ Significant improvement in ESG ▪ Sales share of new products: 10% ▪ 2% of FY22 sales ▪ Organic new machines sales Ratings in 2022 growth of 7.4% in FY22 ▪ Some examples
Slide 12: The workstreams are in full swing of implementing Mission 26
The workstreams are in full swing of implementing Mission 26 Innovation & Sustainability New Food Sales Excellence Digitalization ▪ Significant improvement in ESG ▪ Sales share of new products: 14% ▪ 2% of FY22 sales ▪ Organic new machines sales Ratings in 2022 growth of 7.4% in FY22 ▪ Some examples
Slide 13: The workstreams are in full swing of implementing Mission 26
The workstreams are in full swing of implementing Mission 26 Operational Service Excellence Acquisitions Excellence ▪ Organic service sales growth of ▪ ~€28m savings in procurement in ▪ Actively screening market 11.9% in FY22 FY22 opportunities ▪ Service share: 34.9%, up from ▪ ~€8m savings in produ
Slide 14: The workstreams are in full swing of implementing Mission 26
The workstreams are in full swing of implementing Mission 26 Operational Service Excellence Acquisitions Excellence ▪ Organic service sales growth of ▪ ~€28m savings in procurement in ▪ Actively screening market 11.9% in FY22 FY22 opportunities ▪ Service share: 34.9%, up from ▪ ~€8m savings in produ
Slide 15: The workstreams are in full swing of implementing Mission 26
The workstreams are in full swing of implementing Mission 26 Operational Service Excellence Acquisitions Excellence ▪ Organic service sales growth of ▪ ~€28m savings in procurement in ▪ Actively screening market 11.9% in FY22 FY22 opportunities ▪ Service share: 34.9%, up from ▪ ~€8m savings in produ
Slide 16: Business & Financial Review Q4 2022
Business & Financial Review Q4 2022 Marcus A. Ketter, CFO FY/Q4 2022 Results 16
Slide 17: Executive Summary Q4 2022
Executive Summary Q4 2022 €m Q4 22 Q4 21 Δ Organic order intake growth of 4.6% YoY; seven large orders (>€15m) Order intake 1,360 1,296 4.9% totaling €147m vs. three large orders in Q4 21 of €74m Organic sales growth of 9.7%; strong new machines and service sales Sales 1,414 1,283 10.2% growth EBITD
Slide 18: GEA Group
GEA Group Strong organic sales growth translates into higher EBITDA1 Order Intake, €m Organic order intake 4.6% YoY − All divisions grew order intake organically − Large orders (>€15m) and orders between €5m and €15m 1,296 1,544 1,403 1,372 1,360 contributing mostly to YoY order intake growth Sale
Slide 19: Separation & Flow Technologies
Separation & Flow Technologies Double-digit organic sales growth and further EBITDA1 margin increase Order Intake, €m Organic order intake 7.6% YoY − Growth was driven by Dairy Processing, Beverage as well as Marine 409 420 − Base (<€1m) and orders between €5m and €15m grew 368 341 316 strongly Yo
Slide 20: Liquid & Powder Technologies
Liquid & Powder Technologies Several larger orders and solid organic sales momentum Order Intake, €m Organic order intake 2.6% YoY − Seven large orders (>€15m) totaling €147m vs. three large 526 orders of in total €74m last year 478 461 402 459 − Growth was driven by the customer industries Bevera
Slide 21: Food & Healthcare Technologies
Food & Healthcare Technologies Organic sales growth translates into strong YoY EBITDA1 margin improvement Order Intake, €m Organic order intake 0.2% YoY − Strong performance in Pharma due to several larger orders in 279 273 282 284 the current quarter offset by some areas in Food due to larger 254
Slide 22: Farm Technologies
Farm Technologies Strong organic order intake and sales growth resulting in EBITDA1 margin increase Order Intake, €m Organic order intake 11.0% YoY − 4th quarter in a row with strong order intake growth − Solid demand for automated milking equipment and service 233 213 193 186 161 Sales, €m Organi
Slide 23: Heating & Refrigeration Technologies
Heating & Refrigeration Technologies Solid organic order intake and sales growth; healthy EBITDA1 margin improvement Order Intake, €m Organic order intake 8.9% YoY − Reported YoY decline of 2.1% due to divestments in Spain, Italy and France 162 130 150 142 127 − Good growth from customer industry
Slide 24: All divisions with positive EBITDA contribution
All divisions with positive EBITDA1 contribution 7 0 -2 3 6 208 14 13 Sales 180 Sales Sales Sales GP GP Sales GP GP Op. Cost ● Op. Cost GP Op. Cost Op. Cost Op. Cost EBITDA1 SFT LPT FHT FT HRT GCC / Cons. EBITDA1 Q4 21 Q4 22 1 Before restructuring expenses GP1 = Gross Pro
Slide 25: NWC/Sales ratio at 6.1%
NWC/Sales ratio at 6.1% Strong QoQ improvement driven by reduction in inventories and net contract assets 800 €m 20% 700 €m 15% 600 €m ▪ NWC up YoY driven by an increase in inventory of 8.9% €131m YoY due to supply chain challenges 500 €m 7.2% 7.9% Guided corridor 10% 6.1% 6.1% 5.1% 446 400 €m 5% ▪
Slide 26: Strong net cash position
Strong net cash position Solid Free Cash Flow generation in Q4 FCF Free Cash Flow Q4 22, €m ▪ NWC inflow of €125m driven mainly by inventory destocking -9 ▪ Step-up in capex of €26m YoY in line with FY22 -39 3 125 guidance of up to €230m (FY22 €204m) -89 10 -16 -2 288 208 209 190 FCF conversion rati
Slide 27: Strong financial position and sufficient financial headroom
Strong financial position and sufficient financial headroom Maturity structure (€m) Financial KPIs €m Q4 22 Q4 21 Δ 650 Equity 2,281 2,076 Leverage1 (Rating) 2.0 2.9 Financial Headroom 650 650 ● Linked to ESG performance2 Cash and cash equivalents 719 928 - Drawn credit lines (incl. accrued in
Slide 28: Order backlog breakdown in €bn
Order backlog breakdown in €bn Significant increase in backlog invoiceable in the current year 3.2 2.8 2.3 ▪ ~74% of expected new machine sales 2023 secured through new machine order backlog invoiceable in 2023 2.9 2.5 ▪ In FY 2022 this ratio has been 66% 2,1 0.2 0.3 0.3 2020 2021 2022 Order backlog
Slide 29: Update Operational excellence
Update ▪ Foto JG Operational excellence Johannes Giloth, COO FY/Q4 2022 Results 29
Slide 30: Status-quo on input cost increases & expected savings
Status-quo on input cost increases & expected savings Mitigating cost headwinds Mission 26 procurement savings ramp-up €m, cumulative ▪ In 2022, ~€170m input cost increase faced (~€142m net input cost increase) Target Achieved 90 ▪ For 2023, we expect ~€140m cost headwind vs. 2022 spend (~€128m net
Slide 31: Production savings well on track towards Mission 26 Target
Production savings well on track towards Mission 26 Target Optimizing production landscape Mission 26 production savings ramp-up €m, cumulative ▪ GEA’s first Factory of the Future: Koszalin set up, on time and in budget Target Achieved ▪ Multiple footprint optimization projects implemented as planne
Slide 32: Outlook FY 2023
Outlook FY 2023 Stefan Klebert, CEO FY/Q4 2022 Results 32
Slide 33: Guidance FY 2023
Guidance FY 2023 Organic sales EBITDA1 ROCE1 (currency and portfolio adjusted) (Before restructuring expenses) (Before restructuring expenses) % YoY €m % >5.0 730 - 790 ≥29.0 (PY: €5,165m) (PY: €712m) (PY: 31.8%) In addition, GEA targets to further improve its EBITDA margin before restructuring expe
Slide 34: EBITDA Bridge FY 2023 in €m
EBITDA1 Bridge FY 2023 in €m Guidance: 730-790 712 1 1 EBITDA FY22 Input cost increase Procurement Personnel cost Pricing Production savings Operating leverage EBITDA FY23 savings increase 1 Before restructuring expenses FY/Q4 2022 Results 34
Slide 35: Key priorities FY 2023
Key priorities FY 2023 Sustainability 3 Excellence Initiatives: Innovation & Digitalization Sales New Food Service Acquisitions Operational Delivering on our FY 2023 guidance FY/Q4 2022 Results 35
Slide 36: Roadmap for 2023
Roadmap for 2023 April 27, May 5, August 10, November 8, Today 2023 2023 2023 2023 FY/Q4 AGM Q1 Q2 Q3 2022 FY 2022 2023 2023 2023 FY/Q4 2022 Results 36
Slide 37: Questions & Answers
Questions & Answers Stefan Klebert, CEO Marcus A. Ketter, CFO Johannes Giloth, COO FY/Q4 2022 Results 37
Slide 38: Slide 38
Slide 39: Appendix
Appendix FY/Q4 2022 Results 39
Slide 40: GEA – Q4 2022 figures
GEA – Q4 2022 figures Sales by Customer Industry (L4Q) [in €m] Q4 21 Q4 22 Δ YoY L4Q Q4 21 L4Q Q4 22 Δ YoY Order Intake 4,9% 8,7% 1.296,5 1.360,4 5.222,5 5.678,9 Organic 1 4,6% 7,6% 15% 14% Dairy Farming 17% YoY Dairy Processing -2% YoY Sales 10,2% 9,8% Food 4% YoY 1.282,6 1.413,7 4.702,9 5.164,7 Or
Slide 41: Separation & Flow Technologies – Q4 2022 figures
Separation & Flow Technologies – Q4 2022 figures Sales by Customer Industry (L4Q) [in €m] Q4 21 Q4 22 Δ YoY L4Q Q4 21 L4Q Q4 22 Δ YoY Order Intake 7,8% 13,1% 316,4 341,2 1.359,1 1.537,0 0% Dairy Farming 17% YoY Organic 1 7,6% 9,9% 21% Dairy Processing 16% YoY Sales 13,1% 14,4% 29% Food -7% YoY 324,9
Slide 42: Liquid & Powder Technologies – Q4 2022 figures
Liquid & Powder Technologies – Q4 2022 figures Sales by Customer Industry (L4Q) [in €m] Q4 21 Q4 22 Δ YoY L4Q Q4 21 L4Q Q4 22 Δ YoY Order Intake 3,9% 6,7% 460,5 478,5 1.747,7 1.865,1 1% Organic 1 2,6% 4,0% Dairy Farming n.a 0% 21% Dairy Processing -8% YoY Sales 8,0% 11,0% Food 18% YoY 425,3 459,5 1.
Slide 43: Food & Healthcare Technologies – Q4 2022 figures
Food & Healthcare Technologies – Q4 2022 figures Sales by Customer Industry (L4Q) [in €m] Q4 21 Q4 22 Δ YoY L4Q Q4 21 L4Q Q4 22 Δ YoY Order Intake 1,9% 5,9% 279,1 284,3 1.032,8 1.094,1 Organic 1 0,2% 3,4% 0% Dairy Farming n.a 21% Dairy Processing -42% YoY Sales 10,3% 6,9% Food 12% YoY 256,5 283,1 93
Slide 44: Farm Technologies – Q4 2022 figures
Farm Technologies – Q4 2022 figures Sales by Customer Industry (L4Q) [in €m] Q4 21 Q4 22 Δ YoY L4Q Q4 21 L4Q Q4 22 Δ YoY Order Intake 15,7% 17,5% 160,9 186,1 702,1 825,2 Organic 1 11,0% 11,3% Dairy Farming 17% YoY Dairy Processing n.a Sales 20,0% 17,1% Food n.a 180,5 216,6 633,9 742,0 Organic 1 14,2
Slide 45: Heating & Refrigeration Technologies – Q4 2022 figures
Heating & Refrigeration Technologies – Q4 2022 figures Sales by Customer Industry (L4Q) [in €m] Q4 21 Q4 22 Δ YoY L4Q Q4 21 L4Q Q4 22 Δ YoY Order Intake -2,1% -5,8% 130,0 127,3 617,0 581,1 2% Organic 1 8,9% 10,3% Dairy Farming -3% YoY 19% Dairy Processing -41% YoY Sales -8,1% -10,3% Food -32% YoY 15
Slide 46: Service sales
Service sales 486 468 438 440 52 420 49 404 407 49 391 61 64 376 95 62 50 92 63 85 58 75 75 74 71 83 65 81 67 74 65 63 66 67InsertPicture 68 74 92 98 96 89 103 80 81 74 77 150 162 172 174 135 128 135 141 146 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 SFT LPT FHT FT HRT Figures are shown i
Slide 47: Order Intake development Q4 2022
Order Intake development Q4 2022 by division YoY change Q4 21 Δ M&A Δ FX Δ Organic Q4 22 Separation & Flow 0 1 24 341,2 316,4 Technologies 0,0% 0,3% 7,6% 7,8% Liquid & Powder 0 6 12 478,5 460,5 Technologies 0,0% 1,3% 2,6% 3,9% Food & Healthcare 0 5 0 284,3 279,1 Technologies 0,0% 1,7% 0,2% 1,9% 0 8
Slide 48: Order Intake development Q4 2022
Order Intake development Q4 2022 Order sizes by division YoY change < €1m; >= €1m < €5m; >= €5m < €15m; >= €15m; Δ YoY Δ YoY Δ YoY Δ YoY Q4 22 Separation & Flow 302 24 16 0 341,2 Technologies 17 -8 16 0 Liquid & Powder 153 88 91 147 478,5 Technologies -14 -40 -1 73 Food & Healthcare 156 86 43 0 284,
Slide 49: Sales development Q4 2022
Sales development Q4 2022 by division YoY change Q4 21 Δ M&A Δ FX Δ Organic Q4 22 Separation & Flow 0 7 35 367,3 324,9 Technologies 0,0% 2,2% 10,8% 13,1% Liquid & Powder 0 6 29 459,5 425,3 Technologies 0,0% 1,3% 6,7% 8,0% Food & Healthcare 0 6 21 283,1 256,5 Technologies 0,0% 2,3% 8,1% 10,3% 0 10 26
Slide 50: Sales development Q4 2022
Sales development Q4 2022 New machines and service sales by division YoY change NM sales Q4 22; SER sales Q4 22; SER share Q4 22; org. Δ YoY org. Δ YoY Δ YoY Q4 22 Separation & Flow 193 174 47,3% 367,3 Technologies 6,3% 16,3% 2,3%p 13,1% Liquid & Powder 361 98 21,4% 459,5 Technologies 8,4% 1,1% -1,3
Slide 51: Order intake split as of Q4 2022 L4Q
Order intake split as of Q4 2022 L4Q: Top 30 countries account for 87% of order intake Top DM Countries Share Delta LTM % BtB Top EM Countries Share Delta LTM % BtB United States 20% 1,13 China 10% 1,11 Germany 8% 1,08 Poland 2% 0,99 France 4% 1,11 Brazil 2% 0,99 Netherlands 4% 1,21 India 2% 1,24 Un
Slide 52: Additional financial information for FY 2023
Additional financial information for FY 2023 Depreciation & Financial result Tax rate Capex Amortization (incl. PPA, IFRS 16)1 around from around around €200m -€15m 23% €240m thereof impact from to PPA around -€20m €12m 1 Before restructuring expenses FY/Q4 2022 Results 52
Slide 53: FX development
FX development FX rates Dec Q4 Δ FX YoY Dec 2022 vs Currency % total Dec Q4 * (average) Dec 2021 EUR 41% - - USD 19% 1,05 -11% CNY 8% 7,08 -7% DKK 4% 7,44 0% GBP 3% 0,85 -1% SGD InsertPicture 2% 1,45 -9% PLN 2% 4,69 3% BRL 2% 5,44 -15% RUB 2% 74,80 -14% CAD 2% 1,37 -8% NZD 2% 1,66 -1% *Share of func
Slide 54: Historical timeline (1/4)
Historical timeline (1/4) Order Intake €m Q1 17 Q2 17 Q3 17 Q4 17 FY 17 Q1 18 Q2 18 Q3 18 Q4 18 FY 18 Q1 19 Q2 19 Q3 19 Q4 19 FY 19 Q1 20 Q2 20 Q3 20 Q4 20 FY 20 Q1 21 Q2 21 Q3 21 Q4 21 FY 21 Q1 22 Q2 22 Q3 22 Q4 22 FY 22 SFT 293 301 250 309 1.153 307 305 269 308 1.189 314 323 325 310 1.272 332 288
Slide 55: Historical timeline (2/4)
Historical timeline (2/4) Order Backlog €m Q1 17 Q2 17 Q3 17 Q4 17 FY 17 Q1 18 Q2 18 Q3 18 Q4 18 FY 18 Q1 19 Q2 19 Q3 19 Q4 19 FY 19 Q1 20 Q2 20 Q3 20 Q4 20 FY 20 Q1 21 Q2 21 Q3 21 Q4 21 FY 21 Q1 22 Q2 22 Q3 22 Q4 22 FY 22 SFT 357 360 350 351 351 403 421 396 370 370 413 430 427 397 397 429 398 373 3
Slide 56: Historical timeline (3/4)
Historical timeline (3/4) Depreciation & amortization2 €m Q1 17 Q2 17 Q3 17 Q4 17 FY 17 Q1 18 Q2 18 Q3 18 Q4 18 FY 18 Q1 19 Q2 19 Q3 19 Q4 19 FY 19 Q1 20 Q2 20 Q3 20 Q4 20 FY 20 Q1 21 Q2 21 Q3 21 Q4 21 FY 21 Q1 22 Q2 22 Q3 22 Q4 22 FY 22 SFT (6) (6) (6) (6) (23) (9) (9) (9) (11) (37) (9) (9) (9) (10
Slide 57: Historical timeline (4/4)
Historical timeline (4/4) EBIT4 €m Q1 17 Q2 17 Q3 17 Q4 17 FY 17 Q1 18 Q2 18 Q3 18 Q4 18 FY 18 Q1 19 Q2 19 Q3 19 Q4 19 FY 19 Q1 20 Q2 20 Q3 20 Q4 20 FY 20 Q1 21 Q2 21 Q3 21 Q4 21 FY 21 Q1 22 Q2 22 Q3 22 Q4 22 FY 22 SFT 39 58 43 78 218 34 47 66 35 182 48 35 63 44 190 50 50 53 40 194 52 65 73 69 259 7
Slide 58: GEA.com
| Engineering for a better world. GEA.com