Plus   Neg

GEA Backs FY19 View, Sees Revenue, Margin Growth By 2022; To Cut 800 Jobs

German Technology company GEA Group AG (GEAGF.PK,GEAGY.PK) on Thursday reiterated its business outlook for fiscal 2019. The company continues to expect revenues to be moderately lower than the previous year's level, with EBITDA before restructuring expenses of 450 million euros to 490 million euros.

In its Capital Markets Day today, the company will present new medium-term targets for the entire Group and its five future divisions.

The company plans that consolidated revenues will grow by an average of 2-3 percent per year until 2022. Adjusted EBITDA margin, based on the median value of the current projection at around 9.8 percent for fiscal 2019, would increase to a target range of 11.5-13.5 percent by then.

The company said the planned growth would reflect synergies in procurement, which are expected to take effect as early as 2020, and the optimization of the global production network.

GEA announced the reduction of around 800 full-time employees worldwide by the end of 2020. The company already cut around 220 positions in Business Area Solutions. The company aims to sustainably increase its efficiency by improving revenue per employee, which has declined in recent years. This measure is expected to generate additional annual savings of 35 million euros to 45 million euros.

Further, the company would sell selected business operations in the Farm Technologies and Refrigeration Technologies divisions. The two areas currently generate combined annual revenues of just under EUR 200 million and employ around 700 full-time employees.

GEA earlier said it is creating a new executive mandate for the areas of procurement, production, and logistics. The new COO with responsibility for this area was appointed by the Supervisory Board this week, and the company will make an announcement soon.

Regarding dividend, the company said its long-term goal is to continue to distribute 40 to 50 percent of net profit to shareholders.

In Germany, GEA shares are currently trading at 26.50 euros, up 1.96 percent.

For comments and feedback contact: editorial@rttnews.com

Business News

Editors Pick
Procter & Gamble's skincare brand Olay will debut its first float in the 94th Annual Macy's Thanksgiving Day Parade to be held on November 26 this year. To highlight the low representation of women in the STEM or science, technology, engineering, and math jobs, Olay said that its Thanksgiving Day Parade float will feature a 'Women in STEM' theme. Alternative meat producer Impossible Foods is debuting its flagship product this week in Asian grocery stores. The plant-based meat products will go on sale at about 200 grocery stores in Hong Kong and Singapore, its first grocery foray outside the U.S. Impossible Beef was the flagship product which made its worldwide grocery store debut in 2019. Ahead of the upcoming holiday season, Lowe's Companies Inc. is launching competitive deals urging customers to "gift back" to their home, the place that has meant so much this year amid the coronavirus pandemic. The home improvement retailer is introducing a new Season of Savings, beginning earlier than ever on October 22.
Follow RTT