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GEA ends fiscal year 2017 with moderate growth

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<p class="lead">Düsseldorf-based technology group GEA has published figures for the 2017 financial year together with a business outlook for 2018. The group’s order intake for the whole of 2017 amounted to EUR 4,751 million, which is 1.7 percent above the previous year’s level and sets a new record for GEA.</p>
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This increase resulted above all from order intake in the range up to EUR 5 million, and from growth in dairy farming, food and pharma/chemical industries. Revenue in 2017 (EUR 4,605 million) was a moderate 2.5 percent above the figure for the previous year. The food sector showed particularly positive development with around 12 percent growth. The group’s operating EBITDA amounted to EUR 564 million. As regards its operating cash flow driver, the company posted a ratio to revenue of 8.4 percent last year.

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“We faced a strong euro, which had a negative effect on the company, in particular in the second half of the year. The negative impact from changes in exchange rates between the first and the second half of the year affected order intake and revenue by a mid-double-digit million-euro amount. And we grappled with the sustained weakness in dairy processing. On the other hand, many customer industries met or even exceeded our expectations,” explained Jürg Oleas, CEO of GEA. “As a broadly positioned technology company, we will always have to deal with downturns and subdued order intake in individual markets, as is currently the case in the customer industries dairy processing and beverages. Nonetheless, we anticipate that these segments will turn into growth markets for GEA in the medium term.”

For the 2018 fiscal year, GEA aims to grow revenue by between 5 and 6 percent thanks to the additional contribution from our two latest acquisitions. The operating EBITDA margin will probably be between 12.0 and 13.0 percent of revenue in the current business year. The company expects the operating cash flow driver margin to come in between 8.7 and 9.7 percent in 2018, a figure that does not reflect capital expenditure on strategic projects. This forecast is based on exchange rates that are unchanged relative to 2017, and assumes that there will be no slowdown in global economic growth. Further, the outlook presupposes an absence of serious slumps in demand from relevant customer industries or shifts between these industries that could negatively impact margins.

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