• Order intake for five core segments up organically by 9.4% on prior-year quarter • Stable organic order intake for GEA Heat Exchanger in the third quarter • GEA Food Solutions again contributes positively to earnings • Operating EBIT margin is stable at 10.0% of revenue
Order intake at Düsseldorf-based engineering company GEA has risen to EUR 1,509 million. This corresponds to a 5.8 percent increase after adjustment for portfolio changes and significant adverse currency translation effects. In particular, the two segments strongly focused on the food industry, GEA Mechanical Equipment and GEA Process Engineering, continued their positive performance. Adjusted for currency translation effects and the suspension of a major order from the previous year, the GEA Heat Exchangers Segment increased its order intake by 3.2 percent year-on-year in the reporting period. In the first three quarters, order intake improved organically by 4.2 percent to EUR 4,530 million. The food and beverage area expanded significantly by 10 percent in this period thanks to a number of major orders. Its share of GEA’s order intake increased to 58 percent. Revenue rose organically by 4.4 percent year-on-year to EUR 1,459 million in the third quarter and cumulatively by 2.5 percent to EUR 4,134 million.
The group’s operating EBITDA, i.e., EBITDA adjusted for purchase price allocation effects and nonrecurring items, rose by 1.3 percent to EUR 172 million in the third quarter of 2013. This increased the corresponding EBITDA margin to 11.8 percent of revenue. The operating EBIT margin remained unchanged at 10.0 percent of revenue. Cumulative earnings per share improved by 10.1 percent to EUR 1.03, despite the increase of 4.3 percent in the average number of outstanding shares since September 2012 in connection with the settlement of the award proceedings. The cash flow driver margin (i.e. the ratio of the cash generated to revenue) rose significantly from 5.7 percent as of September 30, 2012, to 9.4 percent as of September 30, 2013, providing the financial scope to support profitable growth.
“Our double-digit organic growth in order intake from the food and beverage sector since the beginning of the year outperformed growth rates in the engineering sector in general. Thanks to this, organic growth by our five core segments as a whole amounted to over 9 percent this quarter. Together with our strong Q3 operating EBIT margin of 10 percent, this underscores our strong market position in demanding end markets. As expected, our GEA Food Solutions Segment generated a positive result in the past quarter,” said Jürg Oleas, CEO of GEA Group Aktiengesellschaft.
Despite the IMF’s repeated downward revision of its economic forecasts for 2013, GEA is expecting moderate organic revenue growth for the Group as a whole in the current fiscal year. This growth is being driven by the five future core segments, whose average organic revenue growth is expected to be in excess of 5 percent. With respect to our cash flow drivers, the group is now aiming for a ratio to revenue of around 9.0 percent in 2013 (after 6.4 percent in the previous year), rather than the previous figure of at least 8.0 percent. Assuming constant currency exchange rates as in FY 2012 GEA aims for an earning target (EBITDA) of around EUR 700 million (previous year: approximately EUR 600 million). This figure does not include costs relating to the strategy and portfolio project in the low tens of millions resulting in particular from the decision on this project announced on June 20, 2013.