GERMANY, Düsseldorf. Germany-based mechanical engineering group GEA, one of the world's largest system suppliers for the production of food and energy, has adjusted its earnings forecast for the course of business in 2021 upwards.
As the listed company announced in Düsseldorf, revenue growth of five to seven percent, adjusted for exchange rate effects and acquisitions and divestments, is now expected for the current year; previously, an increase of no more than five percent had been anticipated here. Management has also raised its forecast for earnings before interest, taxes, depreciation and amortization (EBITDA) before restructuring charges and at constant exchange rates to between € 600 mill. and 630 mill. The previously estimated range was only from € 530 mill. to 580 mill.
This new forecast was based on the assumption that there would be no severe restrictions on economic activity in the second half of 2021 as a result of measures to combat the Covid pandemic. In fiscal 2020, GEA had generated income from operations before interest, taxes, depreciation and amortization (EBITDA) before restructuring expenses of € 532 mill., up € 53.3 mill. or 11% year-on-year. The company justified its more optimistic assessment with the "very good development to date" in the first half of 2021 and further efficiency measures.
According to preliminary figures, order intake in the second quarter increased by 25.1% year-on-year to 1.294 billion euros. Although sales declined by 0.8% to € 1.156 bn., EBITDA before restructuring expenses increased by 9.4% to € 153.7 mill. Investors on the stock market got into a buying mood in view of the new corporate data.