DGAP-News: 2G Energy AG: H1 2013 results impacted by weak market environment and counter-cyclical investments; 2G retains medium-term growth targets
(firmenpresse) - DGAP-News: 2G Energy AG / Key word(s): Half Year Results/Change in
Forecast
2G Energy AG: H1 2013 results impacted by weak market environment and
counter-cyclical investments; 2G retains medium-term growth targets
30.09.2013 / 07:27
---------------------------------------------------------------------
Corporate News
2G Energy AG: H1 2013 results impacted by weak market environment and
counter-cyclical investments; 2G retains medium-term growth targets
- H1 2013 revenue: EUR 41.9 million (H1 2012: EUR 50.3 million)
- H1 2013 total operating revenue: EUR 48.3 million (H1 2012: EUR 46.9
million)
- H1 2013 EBIT loss of EUR 2.1 million (H1 2012: profit of EUR 2.8
million)
- Weaker international business impacts and earnings
- Business in Germany with natural gas-driven CHP's in line with
expectations
- 2013 forecast adjusted: revenue of EUR 120 million to EUR 140 million,
EBIT profit of EUR 3 million to EUR 5 million
Heek, September 30, 2013 -2G Energy AG (ISIN DE000A0HL8N9), one of the
leading German manufacturers of combined heat and power (CHP) plants,
generated EUR 41.9 million of consolidated revenue in the first half of
2013 (as of June 30), compared with EUR 50.3 million in the comparable
period of the previous year. This is offset by a higher level of projects
which have been started, but where most of which will not become effective
in terms of revenue and earnings until the second half of the year. Total
operating revenue consequently grew to EUR 48.3 million (previous year: EUR
46.9 million). The continued weak economic situation in Southern Europe and
regulatory changes in many European countries negatively impacted sales in
the first half of 2013. Business trends in the USA also lagged
expectations. Growth on the German market, especially for natural
gas-driven CHPs, was satisfactory, however. Orders came increasingly from
industrial customers, municipal utilities and major energy supply
companies. Industrial companies and municipal utilities wish to become more
independent of rising energy prices with the help of their own
decentralized electricity and heating supplies. For energy supply companies
and municipal utilities, CHP systems' contribution to grid stability as
well as the flexibility and security of these energy supplies comprise
important investment reasons. Overall, lower sales revenue on the one hand,
and higher investments and reserve costs on the other hand, as well as
extraordinary impairment charges fed through to a EUR 2.1 million loss
before interest and tax (EBIT) (previous year: EBIT profit of EUR 2.8
million). The Group incurred a consolidated net loss of EUR 1.6 million in
the first half of 2013 (previous year: consolidated net profit of EUR 1.9
million). Earnings per share (EPS) stood at EUR -0.36 (previous year:
profit of EUR 0.43 per share), after deducting profits/losses attributable
to non-controlling shareholders.
Good business in Germany, foreign markets lag expectations
2G generated two thirds of its sales revenue in Germany and acquired market
shares in the first half of 2013. Especially given the weak market for
biogas systems for the second consecutive year, and further growth in
demand for natural gas-driven CHPs (sales revenue share in Germany almost
50 %), this trend on the company's domestic market lies within the rangeof
expectations. Weak business in Europe and the USA primarily characterized
the drop in sales revenue and earnings compared with the first half of
2012. Business with biogas-driven CHP systems dominated business on markets
outside Germany in the first half the year with an approximately 30 %
revenue share. The biogas market in Europe was impacted by some significant
falls in national feed-in payments. To these are added lengthy registration
and approval procedures, almost protectionist market barriers and generally
stringent lending conditions for CHP systems, especially on Southern
European markets.
USA: start-up investments on this still young but attractive growth market
In the USA, 2G generated revenue primarily with biogas-driven CHPs. A
marked resurgence of demand is evident on the market for natural gas-driven
CHPs. Numerous projects and tenders - such as that of the Federal State of
New York for 3,000 CHP systems in the 50 to 300 kW output category - are in
the preparatory stage, feeding through to orders in which 2G can
participate through its plants' high quality and efficiency. 2G systems are
currently being subjected to certification procedures in line with US
industrial norm standards so that it can bid in this and other tenders
through preferential approval procedures. Political support for the US CHP
systems market, which is still young but very important, is generally good.
With the founding of 2G Manufacturing in the summer of 2012 and of the 2G
Cenergy sales and service company, the Group has realized important
investments for a good competitive position in one of the most attractive
future growth markets. 2G is still in an early competitive phase in the
USA. The market for natural gas-driven CHPs will become increasingly
relevant there from 2014.
Equity ratio rises to 54.6 %
The balance sheet structure of the 2G Energy Group continued to be very
stable as of June 30, 2013. Compared with the December 31, 2012 balance
sheet date, total assets were down by 10.8 % to EUR 84.5 million since
trade receivables and liquid assets were deployed to reduce trade payables
and bank borrowings. Working capital fell accordingly from EUR 30.1 million
as of December 31, 2012 to EUR 25.1 million. The 2G Group's consolidated
equity stood at EUR 46.2 million as of the balance sheet date (December 31,
2012: EUR 47.8 million), with the equity ratio improving to 54.6 %
(previous year: 50.4 %).
Counter-cyclical investments in capacity expansion and the tapping of new
markets burden earnings
During the reporting period, 2G continued to invest in key areas for future
growth. These include continuous technological improvements of CHP systems
for natural gas, biogas and lean gas operations, and capacity expansions at
the company's site in Heek as well as the hiring of new staff. In the USA,
too, 2G realized counter-cyclical investments in the expansion of
production capacities, employee qualification and tapping the market there.
These investments and reserve costs are not offset by any direct sales
revenue growth, thereby placing a brake on earnings growth in the first
half of 2013. Irrespective of this, 2G has quite consciously utilized
investments and strengthened organizational structures to position itself
at an early stage in this changing and still very attractive market.
The cost of materials ratio during the period under review rose
year-on-year to 68.3 % (H1 2012: 67.7 %) due to an increase in inventories.
The personnel expense ratio was also up year-on-year, from 16.7 % to 21.4
%, due to continued hiring (75 additional staff to reach a total of 486
staff). Other operating expenses increased from EUR 2.1 million to EUR 7.1
million as part of higher sales, operating and administrative expenses in
line with the company's internationalization.
Order book position at the previous year's level
The order book position consisting of CHP orders stood at around EUR 60
million as of June 30, 2013, thereby at the previous year's level. This
order book position comprises around 46 % biogas and 54 % natural gas
applications. The geographic distribution approximately reflects around 67
% from Germany and 33 % from abroad. As far as gas types are concerned, the
order book in Germany comprises a clear preference for natural gas-driven
CHPs of around two thirds. The opposite applies abroad: more than 95 % of
the order book position is attributable to biogas-driven CHPs there.
Outlook: new order intake up, forecast adjusted
For the second half of the 2013 financial year, 2G anticipates marked sales
revenue growth due to its current order book position and a higher level of
invoicing of existing work in progress. New order intake grew in the third
quarter with the order book position for CHP systems amounting to around
EUR 80 million at the end of September 2013, reflecting an approximately 27
% export share and a 52 %/48 % ratio between biogas and natural gas
projects. Although this again signifies sufficiently strong capacity
utilization and employment for the second half of 2013, it will fail to
offset the weak first and second quarters. EBIT trends in the 2013 fiscal
year remain affected by the retention of personnel capacities, the
expansion and creation of Group structures for international business
activities, and extraordinary impairment charges.
The Management Board is downgrading the forecast for the 2013 financial
year that it issued at the end of May (EUR 160 million of sales revenue and
an EBIT margin in the low double-digit range) to consolidated revenue of
between EUR 120 million and EUR 140 million, and a profit before interest
and tax (EBIT) of between EUR 3 million and EUR 5 million.
Appraisal of the sector and the company's own growth prospects from 2014
Based on the company's own assessments of the sector and underpinned by
market studies (e.g. DELTA Energy&Environment), 2G expects a resumption
of constant growth rates from 2014 - following market rationalization due
to a change in international political and economic conditions. While
subsidy and compensation schemes are being reviewed internationally, a
crowding-out process is occurring among CHP manufacturers and biogas system
builders. With its stable financial and asset backing, technically
innovative and multifaceted product range, diversified customer base,
international positioning and independence, 2G is very well positioned on
its markets. With its focus on the future growth markets of America and
Eastern Europe / Middle East, 2G will continue to benefit in the medium to
longterm in the international expansion of annually installed electric
output derived from combined heat and power plants (biogas and natural
gas), especially in the output range between 20 kWe and 550 kWe. 2G also
has many years of expertise in the output range up to 2,000 kWe and will
also be able to generate growth in this area due to a rising number of
reference clients. As a consequence, 2G is retaining its long-term forecast
of revenue growing to EUR 300 million and an achievable EBIT margin of 15 %
by 2020. As far as the coming 2014 financial year is concerned, the
Management Board expects year-on-year growth in both revenue and earnings
in light of its improved order book position and more vigorous new order
intake growth. The forecast for the 2014 financial year will be made more
specific at the latest in May 2014 when the 2013 consolidated financial
statements are presented.
Half-yearly report as of June 30, 2013 available for download
The company will make the half-yearly report as of June 30, 2013 available
for download on September 30, 2013 at
http://www.2-g.de/?langid=2&seitenid=86.
The English version of the H1 report will be published no later than Oct 3,
2013.
2G Energy AG company profile
2G Energy AG is one of the internationally leading providers of CHPs for
decentralized combined heat and electricity supplies. 2G's product
portfolio offers electrical output between 2G kW and 2000 kW for operation
with natural gas, biogas or biomethane. 2G has successfully installed more
than 4,000 modules in 25 countries to date. Its customer base spans
agricultural and industrial operations, local authorities, the residential
housing sector and large energy utilities. The high level of satisfaction
among the company's customers is closely connected with its dense service
network and the high technical quality and performance of 2G power plants,
which achieve total efficiencies of between 85 % and far in excess of 90 %
through combined heat and power. 2G is consistently expanding its
technology leadership through continuous research and development work.
Along with the construction and manufacturing of CHP systems, the company,
which is based in Germany's Münsterland region, offers comprehensive
solutions ranging from planning and installation through to service and
maintenance.
In the context of Germany's new energy policy, CHPs within smart grids -
so-called virtual power plants - are becoming rapidly important due to
their predictable availability.2G Energy (ISIN DE000A0HL8N9) is listed in
the Entry Standard of Deutsche Börse AG. The share capital amounts to EUR
4,430,000, and is split into 4,430,000 shares. As of June 30, 2013, the
company's founders held 56.0 % of the shares, with the free float amounting
to 44.0 %. In the 2012 financial year (January 1 to December 31), 2G Energy
generated EUR 146.5 million of revenue, EUR 16.6 million of earnings before
interest and tax (EBIT), and EUR 11.3 million of net income. The company
currently employs 486 staff.
Forthcoming dates in 2013
October 1, 2013 German Mittelstand Conference, New York
November 11, 2013 Eigenkapitalforum Deutsche Börse AG (Equity Capital
Forum), Frankfurt/ Main
December 10, 2013 Prior Börse Capital Market Conference,
Frankfurt-Egelsbach
Further information: www.2-g.de
Investor relations contact
2G Energy AG
Benzstr. 3, 48619 Heek
Telephone: +49 (0) 2568 93 47-2795
Fax: +49 (0) 2568 93 47-15
E-mail:ir(at)2-g.de
Internet: www.2-g.de
End of Corporate News
---------------------------------------------------------------------
30.09.2013 Dissemination of a Corporate News, transmitted by DGAP - a
company of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
DGAP's Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Media archive at www.dgap-medientreff.de and www.dgap.de
---------------------------------------------------------------------
Language: English
Company: 2G Energy AG
Benzstr. 3
48619 Heek
Germany
Phone: +49 (0)2568-9347-0
Fax: +49 (0)2568-9347-15
E-mail: service(at)2-g.de
Internet: www.2-g.de
ISIN: DE000A0HL8N9
WKN: A0HL8N
Listed: Freiverkehr in Berlin, Düsseldorf, Stuttgart; Frankfurt in
Open Market (Entry Standard)
End of News DGAP News-Service
---------------------------------------------------------------------
232467 30.09.2013
Themen in dieser Pressemitteilung:
2g-energy-ag-h1-2013-results-impacted-by-weak-market-environment-and-counter
cyclical-investments
2g-retains-medium
term-growth-targets
Unternehmensinformation / Kurzprofil:
Datum: 30.09.2013 - 07:27 Uhr
Sprache: Deutsch
News-ID 301129
Anzahl Zeichen: 19499
contact information:
Kategorie:
Business News
Diese Pressemitteilung wurde bisher 341 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"DGAP-News: 2G Energy AG: H1 2013 results impacted by weak market environment and counter-cyclical investments; 2G retains medium-term growth targets"
steht unter der journalistisch-redaktionellen Verantwortung von
2G Energy AG (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
