Gea Group Aktiengesellschaft · XETR:G1A
Gea Group Aktiengesellschaft — Q3 2009 Earnings Presentation
60 slides from Gea Group Aktiengesellschaft's earnings presentation, Oct 29, 2009
Slide 1: Conference Call Third Quarter 2009
Conference Call Third Quarter 2009 Bochum, October 29, 2009
Slide 2: Agenda
Agenda January - September 2009 I. Key figures II. Performance III. Outlook IV. Update Action Plan / New Structure Back Up Performance GEA Group and Segments P&L, Balance Sheet, Cash Flow 2 CC Third Quarter 2009 - October 29, 2009 efficiency in food and energy processes.
Slide 3: Key figures GEA Group
I. Key figures GEA Group [in EUR million] Order Intake Revenue ∆ -21% ∆ -14% 3,871 3,741 3,219 3,071 Q3 1,224 ∆ -21% Q3 1,318 ∆ - 20% 1,061 ∆ -4% 962 ∆ -7% Q2 1,273 ∆ -19% Q2 1,296 1,036 ∆ - 15% 1,104 Q1 1,374 ∆ -22% 1,073 Q1 1,127 ∆ - 6% 1,055 2008 2009 2008 2009 EBITDA* EBIT* ∆ -26% ∆ -34% 386 327
Slide 4: Order Intake Q3
II. Performance Order Intake Q3 [in EUR million] Q3 2009 v. Q1-Q3 2009 v. Q3 2009 v. Q3 2008 Q1-Q3 2008 Q2 2009 y-o-y Change y-o-y Change q-o-q Change in % in % in % Order Intake 1,224 3,871 1,036 previous period Structural 38 3.1% 94 2.4% 10 1.0% Change Currency Effects -9 -0.7% 12 0.3% -6 -0.6% Or
Slide 5: Order Intake: EUR -74m q-o-q Q3 v. Q2 2009
II. Performance Order Intake: EUR -74m q-o-q Q3 v. Q2 2009 Of which Segment Process Technology: EUR -103m q-o-q Q3 v. Q2 2009 Index Process Equipment (Q4 2008 = 100) • Still limited activities in brewery • Stabilizing in petro and chemical 140 industry Process Engineering • Index Q3: 97 • High compa
Slide 6: Recent trends in customer industries
II. Performance Recent trends in customer industries Pharma / Medical Marine Others Food / Beverages New round of mergers No new orders, (incl. contract low charter rates Liquid dairy, food, fruit & manufacturers) recovery juice, coffee: in late 2010 4% Comparatively resilient 6% 5% Milk powder: HVA
Slide 7: Regional order intake trend in 2009
II. Performance Regional order intake trend in 2009 East- and West-Europe OI 2009 Q3 09 [in EUR million] Q2 09 Q1 09 CIS 0 200 400 600 OI 2009 Q3 09 Q2 09 Q1 09 0 200 400 600 North America OI 2009 Q3 09 Q2 09 Q1 09 South-East Asia 0 200 400 600 OI 2009: Q3 09 Q2 09 Q1 09 Middle-East OI 2009 0 200 40
Slide 8: Regional revenue trends Q1-Q3 2009 v. Q1-Q3 2008
II. Performance Regional revenue trends Q1-Q3 2009 v. Q1-Q3 2008 Western Europe: -7% Q3 09 [in EUR million] Q2 09 Q1 09 0 200 400 600 Eastern Europe, CIS: -44% Q3 09 Q2 09 Q1 09 0 200 400 600 North America -11% Q3 09 Q2 09 Q1 09 South-East Asia: 0 200 400 600 +3% Q3 09 Q2 09 Q1 09 Middle-East: -41%
Slide 9: Examples of major orders during Q3 2009
II. Performance Examples of major orders during Q3 2009 [in EUR million] Romania: Russia: New high concentration ACC-Heller, indirect ash slurry system Dry Cooling System EUR 20.5m EUR 19.7m China: Environmentally friendly cooling system, EUR 44.0m Morocco: USA: Dry Cooler, Laos: Food & Dairy, EUR 2
Slide 10: Top Line Trend
II. Performance Top Line Trend [in EUR million] Order cancellations of Order Backlog EUR 12.2m in Q3 09 3,000 (EUR 17.8m in Q3 08) 2,500 2,000 1,500 Revenue 1,000 Order Intake 500 0 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 10 CC Third Quarter 2009 - October 29, 2009 efficiency in food and energy pr
Slide 11: Order Backlog – invoicable until year end
II. Performance Order Backlog – invoicable until year end [in EUR million] 3,500 3,000 2,824 2,440 2,312 2,500 2,000 1,380 1,784 1,362 1,500 1,000 500 1,060 1,040 950 0 Sept. 2007 Sept. 2008 Sept. 2009 OB invoicable in respective FY OB invoicable after respective FY 11 CC Third Quarter 2009 - Octobe
Slide 12: EBITDA Bridge Q1-Q3 2009 v. Q2-Q4 2008
II. Performance EBITDA Bridge Q1-Q3 2009 v. Q2-Q4 2008 [in EUR million] 550 Savings 491.4 500 achieved 450 so far 400 350 300 +30.4 +33.8 246.9 250 +106.2 -39.0 -1.7 200 233.1 150 158.9 100 -374.2 50 0 * GP (total cost method) = Revenue – material costs ** Balance of other operational income and exp
Slide 13: Net debt reconciliation – cash flow drivers
II. Performance Net debt reconciliation – cash flow drivers [in EUR million] 60.2 Net debt December 31, 2008 EBITDA before restructuring 285.9 ∆ Working Capital 133.5 (73.6) Dividend (39.7) Acquisitions (86.2) CAPEX (14.3) Cash out restructuring Taxes / (74.6) Interests incl. change in provisions -4
Slide 14: Working Capital Development since Dec. 2008
II. Performance Working Capital Development since Dec. 2008 [in EUR million] Receivables Inventories Trade 09/30/2009 − Payables = 657 -46 -35 -18 -24 -39 Change -4% -5% -3% -4% -6% Receivables Inventories Trade Advance Working 06/30/2009 − Payables Paym. = Capital 696 -242 -31 -166 -12 -94 Change -
Slide 15: Financial Leeway
II. Performance Financial Leeway [in EUR million] 09/30/2009 12/31/2008 Change Cash & Equivalents 297 440 -143 Securities 0 1 -1 Loans 511 500 11 Net debt 214 60 154 Equity 1,472 1,455 17 Gearing 14.5% 4.1% - GEA credit lines 09/30/2009 09/30/2009 09/30/2009 [in EUR million] granted utilized reserve
Slide 16: Progress of Lurgi and Lentjes Projects
II. Performance Progress of Lurgi and Lentjes Projects Typical duration: 2-4 yrs 1-6 mts 1-3 mts 2-3 yrs Change compared to July 2009: Le Le Le Le Le Le Le Le Le LeLe Le • 1 Lentjes project 2007 Lu Lu Lu Lu Lu Lu out of warranty Warranty period • 3 Lentjes Construction Com. Test PAC FAC projects pas
Slide 17: Key figures FY 2009
III. Outlook Key figures FY 2009 Revenue: around EUR 4,400 million EBITDA-Margin before restructuring cost: around 9.3% EBIT-Margin before restructuring cost: around 7.0% 17 CC Third Quarter 2009 - October 29, 2009 efficiency in food and energy processes.
Slide 18: Update on legal risks
III. Outlook Update on legal risks Background: Today’s GEA Group AG is the legal successor of Metallgesellschaft AG / mg technologies ag which acquired the former GEA AG in 1999 when also a domination agreement between the two companies was concluded. Former shareholders of GEA AG, which was later m
Slide 19: Current situation GEA restructuring projects
IV.Update Action Plan / New Structure Current situation GEA restructuring projects I) Capacity adjustments: • Planned capacity reduction of around 2,300 full time equivalents in total (Phase I announced in YE 2008; escalation phase II announced in Q2 2009) • Capacity reduction per Q3 around 75% of t
Slide 20: The new GEA Group segmentation as of Jan. 2010
IV.Update Action Plan / New Structure The new GEA Group segmentation as of Jan. 2010 New Segments Products Former Divisions Milking systems and other products Farm Technologies (100%) Farm Technologies in the fields of animal hygiene, milking parlour cleaning and accessories All heat exchangers: fin
Slide 21: HX-Segment: Concentration of all heat exchangers
IV.Update Action Plan / New Structure HX-Segment: Concentration of all heat exchangers Divisions (current) Air Treatment Process Thermal Process Refrigeration Equipment Engineering Engineering Finned Tube Type of Heat Exchanger Shell & Tube Plate HX Others 21 CC Third Quarter 2009 - October 29, 2009
Slide 22: Heat exchanger manufacturing locations
IV.Update Action Plan / New Structure Heat exchanger manufacturing locations Thermal Engineering Process Equipment Refrigeration Air Treatment Process Engineering Sites for more than one division 22 CC Third Quarter 2009 - October 29, 2009 efficiency in food and energy processes.
Slide 23: Heat exchanger manufacturing locations
IV.Update Action Plan / New Structure Heat exchanger manufacturing locations Production Personnel HX per High Cost Country (Canada, USA, W. Europe) Manufacturing Site (Basis 07/2009) Low Cost Country (L.Am., Asia, RSA, E. Europe) 22 of the 56 manufacturing sites (39%) employ an above average number
Slide 24: Synergy Potential in the Heat Exchangers Segment
IV.Update Action Plan / New Structure Synergy Potential in the Heat Exchangers Segment Before restructuring After restructuring Global • Large variety of factory • Fewer, but larger manufacturing sizes factories • Predominantly in high- • More in low- cost countries cost countries Bundling of Procur
Slide 25: Outlook Long term – Over the Cycle
Outlook Long term – Over the Cycle Long term growth of GEA end markets: 3% – 6% p.a., clearly > GDP growth EBIT margin GEA Group: Target of 12% after recovery to pre-crisis market conditions Dividend payout ratio: 1/3 of net income Acquisitions to continue 25 CC Third Quarter 2009 - October 29, 2009
Slide 26: Financial Calendar
Outlook Financial Calendar March 11, 2010 Full Year Report Fiscal Year 2009 April 21, 2010 Annual General Meeting May 6, 2010 Interim Report Q1 2010 July 30, 2010 Interim Report Q2 2010 October 29, 2010 Interim Report Q3 2010 26 CC Third Quarter 2009 - October 29, 2009 efficiency in food and energy
Slide 27: Disclaimer
Disclaimer Forward-looking statements are based on our current assumptions and forecasts. These statements naturally entail risks and uncertainties, which may cause the actual results of operations, financial position or performance to diverge significantly from the estimates given here. Factors tha
Slide 28: efficiency in food and energy processes.
efficiency in food and energy processes.
Slide 29: Agenda
Agenda January - September 2009 I. Key figures II. Performance III. Outlook IV. Update Action Plan / New Structure Back Up Performance GEA Group and Segments P&L, Balance Sheet, Cash Flow 29 CC Third Quarter 2009 - October 29, 2009 efficiency in food and energy processes.
Slide 30: P&L Key Items Q3 2009
Back up: Performance GEA Group P&L Key Items Q3 2009 [in EUR million] Q3 2009 Q3 2008 Change in % Order intake 962.3 1,223.5 -21.4 Order cancellations of EUR 12.2m Order backlog 2,312.1 2,823.8 -18.1 (v. EUR 17.8m PY) Revenue 1,060.8 1,318.0 -19.5 Gross profit 310.7 373.4 -16.8 EBITDA before restruc
Slide 31: P&L Key Items Q1–Q3 2009
Back up: Performance GEA Group P&L Key Items Q1–Q3 2009 [in EUR million] Q1-Q3 2009 Q1-Q3 2008 Change in % Order intake 3,070.8 3,870.6 -20.7 Order cancellations of EUR 73.7m Order backlog 2,312.1 2,823.8 -18.1 To be Updated (v. EUR 60.7m PY) Revenue 3,219.2 3,741.0 -13.9 Gross profit 922.1 1,043.7
Slide 32: Key Balance Sheet Items Q3 2009
Back up: Performance GEA Group Key Balance Sheet Items Q3 2009 [in EUR million] 09/30/09 12/31/08 Change [in EUR million] 09/30/09 12/31/08 Change in % in % Goodwill 1,343.5 1,331.8 0.9 Equity 1,471.8 1,455.4 1.1 PP&E 585.0 547.7 6.8 Non-current financial liabilities 250.6 255.1 -1.8 Other 543.0 545
Slide 33: Share of revenue by region Q1-Q3
Back up: Performance GEA Group Share of revenue by region Q1-Q3 (y-o-y change) Africa +1%pt Australia + Middle East - -1%pt Latin America - -2%pts 2% Top 3 Countries 4% Western Europe -1%pt - 4% +3%pts 5% + Germany 14.2% Eastern Europe -4%pts - 8% USA Revenue Q1-Q3 2009: 46% 13.7% EUR 3,219m 15% Nor
Slide 34: Performance Segments Energy and Farm Technology
Back up Performance Segments Energy and Farm Technology 34 CC Third Quarter 2009 - October 29, 2009 efficiency in food and energy processes.
Slide 35: Energy and Farm Technology Q3 2009
Back up: Performance Segments Energy and Farm Technology Q3 2009 [in EUR million] Q3 2009 Q3 2008 Change • Only Thermal Engineer- in % ing could increase Order intake 338.4 397.1 -14.8 order intake y-o-y, all Order backlog 1,013.0 1,164.7 -13.0 other divisions below Q3 2008 Revenue 354.7 478.7 -25.9
Slide 36: Energy and Farm Technology Q1-Q3 2009
Back up: Performance Segments Energy and Farm Technology Q1-Q3 2009 [in EUR million] Q1-Q3 2009 Q1-Q3 2008 Change • Order intake and in % revenue declined in all Order intake 1,009.6 1,234.8 -18.2 divisions Order backlog 1,013.0 1,164.7 -13.0 • Order cancellations of Revenue 1,051.2 1,288.9 -18.4 EU
Slide 37: Energy and Farm Technology Segment
Back up: Performance Segments Energy and Farm Technology Segment OI Revenue EBIT-Margin (before restructuring) Q3 2009 v. Q3 2008 Q3 2009 v. Q2 2009 Customer industries Top 3 regions food Revenue share energy Western Europe oil/gas North America chemicals Revenue South-East Asia 2008 HVAC/constructi
Slide 38: Energy and Farm Technology – Air Treatment
Back up: Performance Segments Energy and Farm Technology – Air Treatment OI Revenue EBIT-Margin (before restructuring) Q3 2009 v. Q3 2008 Q3 2009 v. Q2 2009 Customer industries Top 3 regions food Revenue share energy Western Europe oil/gas Eastern Europe chemicals Middle East Revenue 2008 HVAC/const
Slide 39: Energy and Farm Technology – Farm Technologies
Back up: Performance Segments Energy and Farm Technology – Farm Technologies OI Revenue EBIT-Margin (before restructuring) Q3 2009 v. Q3 2008 Q3 2009 v. Q2 2009 Customer industries Top 3 regions Revenue share Western Europe North America food Revenue Eastern Europe 2008 Q1-Q3 Other 2009 39 CC Third
Slide 40: Energy and Farm Technology – Thermal Engineering
Back up: Performance Segments Energy and Farm Technology – Thermal Engineering OI Revenue EBIT-Margin (before restructuring) Q3 2009 v. Q3 2008 Q3 2009 v. Q2 2009 Costumer industries Top 3 regions food Revenue share energy Western Europe oil/gas South-East Asia chemicals North America Revenue 2008 c
Slide 41: Energy and Farm Technology – Emission Control
Back up: Performance Segments Energy and Farm Technology – Emission Control OI Revenue EBIT-Margin (before restructuring) Q3 2009 v. Q3 2008 Q3 2009 v. Q2 2009 Customer industries Top 3 regions Revenue share South-East Asia Western Europe environmental Revenue Eastern Europe 2008 Q1-Q3 Other 2009 41
Slide 42: Performance Segments Process Technology
Back up Performance Segments Process Technology 42 CC Third Quarter 2009 - October 29, 2009 efficiency in food and energy processes.
Slide 43: Process Technology Q3 2009
Back up: Performance Segments Process Technology Q3 2009 [in EUR million] Q3 2009 Q3 2008 Change • Order intake declined in in % all divisions with Order intake 626.4 828.9 -24.4 exception of Division Order backlog 1,302.6 1,666.6 -21.8 Pharma Systems Revenue 700.6 831.9 -15.8 • Only Division EBITDA
Slide 44: Process Technology Q1-Q3 2009
Back up: Performance Segments Process Technology Q1-Q3 2009 [in EUR million] Q1-Q3 2009 Q1-Q3 2008 Change • Order intake declined in in % all divisions Order intake 2,069.4 2,643.2 -21.7 • Revenue below Q1-Q3 Order backlog 1,302.6 1,666.6 -21.8 2008 in all divisions – Revenue 2,155.3 2,433.9 -11.4 o
Slide 45: Process Technology Segment
Back up: Performance Segments Process Technology Segment OI Revenue EBIT-Margin (before restructuring) Q3 2009 v. Q3 2008 Q3 2009 v. Q2 2009 Customer industries Top 3 regions food Revenue share energy Western Europe mineral oil/gas South-East Asia chemicals Revenue North America 2008 construction Q1
Slide 46: Process Technology - Refrigeration
Back up: Performance Segments Process Technology - Refrigeration OI Revenue EBIT-Margin (before restructuring) Q3 2009 v. Q3 2008 Q3 2009 v. Q2 2009 Customer industries Top 3 regions food Revenue share energy Western Europe oil/gas Eastern Europe chemicals North America Revenue 2008 construction Q1-
Slide 47: Process Technology – Process Equipment
Back up: Performance Segments Process Technology – Process Equipment OI Revenue EBIT-Margin (before restructuring) Q3 2009 v Q3 2008 Q3 2009 v Q2 2009 Customer industries Top 3 regions food Revenue share energy Western Europe oil/gas South-East Asia chemicals North America Revenue 2008 construction
Slide 48: Process Technology – Mechanical Separation
Back up: Performance Segments Process Technology – Mechanical Separation OI Revenue EBIT-Margin (before restructuring) Q3 2009 v. Q3 2008 Q3 2009 v. Q2 2009 Customer industries Top 3 regions food Revenue share energy Western Europe oil/gas South-East Asia chemicals North America Revenue 2008 constru
Slide 49: Process Technology – Process Engineering
Back up: Performance Segments Process Technology – Process Engineering OI Revenue EBIT-Margin (before restructuring) Q3 2009 v. Q3 2008 Q3 2009 v. Q2 2009 Customer industries Top 3 regions food Revenue share energy Western Europe oil/gas South-East Asia chemicals North America Revenue 2008 construct
Slide 50: Process Technology – Pharma Systems
Back up: Performance Segments Process Technology – Pharma Systems OI Revenue EBIT-Margin (before restructuring) Q3 2009 v. Q3 2008 Q3 2009 v. Q2 2009 Customer industries Top 3 regions Revenue share pharma/medical Western Europe South-East Asia North America Revenue 2008 Q1-Q3 Other 2009 50 CC Third
Slide 51: Definition of deviation ranges
Back up: Performance Segments Definition of deviation ranges Order Intake 3% to 3% to -3% to Revenue > 10% 10% -3 % -10% < -10% Delta -50 bps -50 bps > 100 50 bps to < -100 Margin to to bps 100 bps bps in bps 50 bps -100 bps 51 CC Third Quarter 2009 - October 29, 2009 efficiency in food and energy p
Slide 52: P&L, Balance Sheet, Cash Flow
Back up P&L, Balance Sheet, Cash Flow 52 CC Third Quarter 2009 - October 29, 2009 efficiency in food and energy processes.
Slide 53: Income Statement Q1-Q3 2009 (1)
Back up: P&L, Balance Sheet, Cash Flow GEA Group: Income Statement Q1-Q3 2009 (1) [in EUR thousand] Q1-Q3 2009 Q1-Q3 2008 Change in % Revenue 3,219,225 3,741,002 -13.9 Cost of sales -2,297,084 -2,697,270 +14.8 Gross profit 922,141 1,043,732 -11.6 Selling expenses -356,611 -352,304 -1.2 General and a
Slide 54: Income Statement Q1-Q3 2009 (2)
Back up: P&L, Balance Sheet, Cash Flow GEA Group: Income Statement Q1-Q3 2009 (2) [in EUR thousand] Q1-Q3 2009 Q1-Q3 2008 Change in % Profit before tax on cont. operations 133,329 292,758 -54.5 Income tax -35,999 -79,630 +54.8 Profit after tax from cont. operations 97,330 213,128 -54.3 Loss after ta
Slide 55: Balance Sheet Q3 2009 (1)
Back up: P&L, Balance Sheet, Cash Flow GEA Group: Balance Sheet Q3 2009 (1) [in EUR thousand] 09/30/2009 12/31/2008 Change in % Property, plant and equipment 585,021 547,722 6.8 Investment property 12,757 14,433 -11.6 Goodwill 1,343,549 1,331,833 0.9 Other intangible assets 152,209 144,349 5.4 Equit
Slide 56: Balance Sheet Q3 2009 (2)
Back up: P&L, Balance Sheet, Cash Flow GEA Group: Balance Sheet Q3 2009 (2) [in EUR thousand] 09/30/2009 12/31/2008 Change in % Subscribed capital 496,890 496,890 - Capital reserves 1,079,610 1,079,610 - Retained earnings -47,768 -69,689 31.5 Accumulated other comprehensive loss/income -58,096 -54,7
Slide 57: Cash Flow Q1-Q3 2009 (1)
Back up: P&L, Balance Sheet, Cash Flow Cash Flow Q1-Q3 2009 (1) [in EUR thousand] 01/01/2009- 01/01/2008- 09/30/2009 09/30/2008 GEA Group profit for the period 95,970 77,584 + Income taxes 35,999 79,630 + Profit after tax from discontinued operations 1,360 135,544 = Profit before tax from continuing
Slide 58: Cash Flow Q1-Q3 2009 (2)
Back up: P&L, Balance Sheet, Cash Flow Cash Flow Q1-Q3 2009 (2) [in EUR thousand] 01/01/2009- 01/01/2008- 09/30/2009 09/30/2008 = Cash flow from operating activities 225,736 88,147 Proceeds from disposal of noncurrent assets 2,601 5,496 Payments to acquire property, plant and equipment, and intangib
Slide 59: Cash Flow Q1-Q3 2009 (3)
Back up: P&L, Balance Sheet, Cash Flow Cash Flow Q1-Q3 2009 (3) [in EUR thousand] 01/01/2009- 01/01/2008- 09/30/2009 09/30/2008 = Cash flow from investing activities -251,481 -320,486 Dividend payments -73,643 -36,797 Change in finance leases -1,136 -931 Proceeds from finance loans 10,193 287,449 Re
Slide 60: Key Figures Time Line
Back up: P&L, Balance Sheet, Cash Flow Key Figures Time Line Order Intake Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2006 2007 2008 [in EUR million] 2006 2006 2007 2007 2007 2007 2008 2008 2008 2008 2009 2009 2009 Energy and Farm Technology 360.8 525.7 1,770.4 424.3 373.2 364.0 829.6 1,191.2 451.8 385.9
GEA Group Aktiengesellschaft — Q3 2009 Earnings Presentation on 6ix