Analyst Call
Preliminary figures Q4 2017
GEA GROUP, JANUARY 24, 2018
This presentation contains forward-looking statements. Forward-looking statements may include, in
particular, statements about future events, future financial performance, plans, strategies, expectations,
prospects, competitive environment, regulation and supply and demand. Statements with respect to the
future are characterized by the use of words such as "expect", "intend", "plan", "anticipate", "believe",
"estimate" and similar terms. Forward-looking statements are based on our current assumptions and
forecasts. These statements naturally entail risks and uncertainties, which may cause the actual results
of operations, financial position or performance to diverge materially from the estimates given here.
Factors that could cause such a divergence include, inter alia, changes in the economic and business
environment, fluctuations in exchange rates and interest rates, launches of competing products, poor
acceptance of new products or services, and changes in business strategy. Given these uncertainties,
readers should not put undue reliance on any forward-looking statements. We undertake no obligation
to update or revise any forward-looking statements.
Disclaimer
2 GEA Conference Call Presentation January 24, 2018
1. Preliminary figures Q4 / FY 2017
2. Outlook FY 2018
3
134 130
86 78
223 224
0 €m
50 €m
100 €m
150 €m
200 €m
250 €m
Q4 16 Q4 17
BA Equipment BA Solutions
634 653
712 706
1.293 1.307
0 €m
500 €m
1.000 €m
1.500 €m
Q4 16 Q4 17
BA Equipment BA Solutions
598 658
685 717
1.223 1.316
0 €m
500 €m
1.000 €m
1.500 €m
Q4 16 Q4 17
BA Equipment BA Solutions
Preliminary key figures and change YoY Q4 2017
4 GEA Conference Call Presentation
1. Excluding bottling charges of €9m in Q4 16 and -€2m in Q4 17; 2. Adjusted = before currency translation and structural effects Note: Not audited and excl. Pavan
Order Intake
Operating EBITDA Margin1 Operating EBITDA1
Sales
Please note that the difference between the sum of the BAs and the Group is explained by
consolidation/others
Δ +7.6%
adjusted2 +10.6%
+4.7%
+10.0%
Δ +1.1%
adjusted2 +4.6%
-0.9%
+3.0%
Δ +0.1%
adjusted2 +5.3%Q4 16 Q4 17 Δ YoY
BA Equipment 21.1% 19.9% -123 bps
BA Solutions 12.0% 11.1% -91 bps
GEA Group 17.3% 17.1% -17 bps
+1.8%
Highest Q4
order intake
384 390
196 181
579 585
0 €m
200 €m
400 €m
600 €m
Q4 16 Q4 17
BA Equipment BA Solutions
2.262 2.346
2.426 2.437
4.492 4.580
0 €m
1.000 €m
2.000 €m
3.000 €m
4.000 €m
5.000 €m
Q4 16 Q4 17
BA Equipment BA Solutions
2.347 2.478
2.535 2.484
4.674 4.750
0 €m
1.000 €m
2.000 €m
3.000 €m
4.000 €m
5.000 €m
Q4 16 Q4 17
BA Equipment BA Solutions
Preliminary key figures and change YoY FY 2017
5 GEA Conference Call Presentation
1. Excluding bottling charges of €13m in FY 16 and €20m in FY 17; 2. Adjusted = before currency translation and structural effects Note: Not audited and excl. Pavan
Order Intake
Operating EBITDA Margin1 Operating EBITDA1
Sales
Please note that the difference between the sum of the BAs and the Group is explained by
consolidation/others
adjusted2 +1.7%
-2.0%
+5.6%
adjusted2 +2.5%
Δ +1.6% Δ +2.0%
+0.5%
+3.7%
Δ +1.0%
adjusted2 -0.5%FY 16 FY 17 Δ YoY
BA Equipment 17.0% 16.6% -35 bps
BA Solutions 8.1% 7.4% -67 bps
GEA Group 12.9% 12.8% -13 bps
FY 16 FY 17
FY 16 FY 17
FY 16 FY 17
+1.5%
Highest FY
order intake
P&L projection from July vs. actual figures H2 2017
6 GEA Conference Call Presentation
preliminary numbers rounded [EUR m]
Projected H2 2017
as per Q2 2017
(lower case)
Sales
Op. EBITDA2 “pre” (before bottling extra costs)
in % of sales
2,470 +3.2% yoy
374 15.1%
Actual H2 2017
(prelim.)
2,440 +1.9% yoy
358 14.7%
Comments on variance
January 24, 2018
Op. EBITDA2 “post” (after bottling extra costs)
in % of sales
354 14.3%
346 14.2%
Adverse FX impact of mid
double-digit million-euro
FX translation: -€5m
No further bottling charges
expected in 2018
Gross margin (before bottling extra costs)
in % of sales
784 31.7%
767 31.4%
Mix effect of ca. -9 EURm
Volume effect of ca. -9 EURm
Overhead (incl. net other income (expenses), FX
impact & financial result, adj. for D&A, PPA)
(410)1 (408)1 Delta of +2 EURm
1. Includes income from divesting real estate of +14 EURm
2. For a definition of operating EBITDA, see p. 206 of the company’s 2016 Annual Report
Deep-dive: FX impact
7 GEA Conference Call Presentation January 24, 2018
ca.
420
ca.
230
NAM
APAC
LAM
Sales streams impacted by FX Headwind from EUR appreciation
Export sales1, LTM Nov 2017 in EURm
EUR/USD +2.0%
EUR/CNY +3.7%
ca.
170
EUR
+13.8%
+6.6%
Ø
2017 vs. 2016
Spot end Dec
2017 vs. 2016
26%
15%
Share of export
sales1 LTM Nov 17
Example EUR/USD FX effect Separator spare part produced in Europe was sold e.g. for
end of Dec 2016 for EUR 1,000 to e.g. Germany
end of Dec 2016 for ca. USD 1,054 to e.g. USA
end of Dec 2017 for ca. USD 1,190 to e.g. USA
GEA margin pressure
Customer postpones volume pressure
GEA manages to pass price increase to customer 1. Sales trade flows from Euro countries to major non-Euro countries (€820M)
Update on share buyback
8 GEA Conference Call Presentation January 24, 2018
97% of EUR 450m spent as of January 19, 2018
Completion expected by end of February 2018
1. Preliminary figures Q4 / FY 2017
2. Outlook FY 2018
9
First indications for 2018
10 GEA Conference Call Presentation January 24, 2018
Sales organically
about 2017 level (excluding acquisitions since January 2017)
Op. EBITDA range
EUR 590m to EUR 640m (at end of Dec 2017 FX rates)
Op. EBITDA1
Acquisitions since January
2017 will add
about EUR 190m
1. For a definition of operating EBITDA, see p. 206 of the company’s 2016 Annual Report
Deep-dive: First indications for 2018
11 GEA Conference Call Presentation January 24, 2018
ca. 50
ca. 75
Lower end
guidance op.
EBITDA 2018
ca. 590
M&A and efficiency
initiatives esp. in
pricing & supply
chain
FX,
IT cloud,
personnel cost
increase,
real estate
divestment FY 17
High end guidance
op. EBITDA 2018
ca. 640
Volume, mix &
further efficiency
ca. -70
Starting point op.
EBITDA 2017 (adj.)
ca. 585
in EURm
GEA’s topline has been strongly affected by the dairy recession – dairy processing yet to recover
12 GEA Conference Call Presentation
FY 15 FY 14 FY 13
ca. -12%
FY 17 FY 16
Dairy Processing Solutions (BA-S)
Development since 2013
Order Intake Dairy Processing Solutions
OI, Dairy Processing Solutions only
January 24, 2018
Deep-dive 2017 vs. 2016
Order Intake excl. Dairy Processing Solutions
OI, GEA Group excl. Dairy Processing Solutions
+1.6%
FY 17 FY 16
Dairy Processing Solutions (BA-S)
GEA Group excl. Dairy Processing Solutions (BA-S)
ca. -16%
ca. +5%
YoY growth
“Growth slowing down
across categories”
“…economic conditions will remain
volatile & uncertain.., with persis-
tently fragile consumer trends”
“Food and beverage: Long-
run prospects for the sub-
sector are positive… However, it
can be cyclical, and our analysts
are forecasting food & beverage
organic sales growth close to an
all-time low”
“…there have hardly
been any productivity
increases in the recent years,
mainly due to salary increases”
“Resilient real internal
growth in an environ-
ment of weak consumer demand
(Q1’16-Q3’17)” “.. Coffee clearly
growth driver (5% CAGR 2013-16)”
External view on market sentiment (selected quotes)
13 January 24, 2018
Customers Industry Analysts
Production growth of 3% for 2017
and 2018
Essential Dairy & Plant-based with -2%
negative growth YTD 2017
Food processing machinery and
packaging machinery +4% for 2018
Target 2020: 4%-5% L4L sales growth
(packaged goods CAGR 0,8%-2,8%)
“Growth in the global Food
& Beverage industry has
been slowing to 1% over 2011-
2016… ingredients should outstrip
this with growth of 4-5%.”
1%-2% growth in 2017 for Europe
& US Food & HPC manufacturers
0% CAGR for 2017-2020 (Capex)
2,6% organic growth for 2017
Target 2020: Mid-single digit growth Packaged foods market value
growth 3%-4% midterm
GEA Conference Call Presentation
Source: Danone Q3 2017 release; Nestlé Q3 2017 release; ; Nestlé Investor Seminar 2017; VDMA Prognosespiegel Nov 2017; Goldman Sachs „GS Capex Tracker“ Oct 2017;
Deutsche Bank Report, „Ingredients for Beginners“ Dec 2017
Assumptions behind first indication for 2018
14 GEA Conference Call Presentation January 24, 2018
THREATS OPPORTUNITIES
• Continued market weakness in Dairy
Processing and Beverages
• Continued volatility of milk price
• Adverse FX impacts
• Pricing pressure in selected markets
with slow down in investment activities
• Low unemployment rate causing
difficulties in hiring skilled workforce
• Prospects of improved investment climate in
the US in the wake of tax cut
• Positive development in other markets
partially offsetting weakness in Dairy
Processing and Beverages
• Improvement potential from strategic
initiatives
• Supply chain management among others to
reduce FX exposure (e.g. local sourcing)
• Further leverage of GEA innovation strength
and leading market position
GEA OxyCheck
Innovation – portfolio enrichment through leading technologies (1/2)
15 GEA Conference Call Presentation January 24, 2018
GEA OxyCheck the first system
able to measure the oxygen
content of each pack, inline in a
packaging machine. Contact free
and without destroying the
package
Pavan Extrusion
Pavan offers the widest range of solutions for the production of all kinds of pasta
It also provides dies, cutting systems, die washing equipment and packaging lines.
VIPOLL All-in-One
monoblock filler
New VIPOLL All-in-One mono-
block filler can be adapted to
various container types. It offers
customers the added value of
multifunctional beverage lines
that rapidly switch between bottle,
can and PET filling.
ConsiGma for continuous
processing
Innovation – portfolio enrichment through leading technologies (2/2)
16 GEA Conference Call Presentation January 24, 2018
ConsiGma, a multipurpose
platform designed to transfer
powder into coated tablets in
development, pilot, clinical or other
volumes in a single compact unit,
dosing and mixing, all in one
line.
Super High Yield
Extraction (SHYE)
SHYE is maximizing instant
coffee yield by up to 70 %. The
extraction process offers higher
flavor quality resulting in
enhanced taste of instant coffee
and better utilization.
Monobox
GEA Monobox provides the
greatest advantages in automated
milking, accommodating up to 70
cows per box. It allows for an
individualized approach to
maximizing a farm’s operational
efficiency.
Capital Markets Day March 12, 2018
17 GEA Conference Call Presentation January 24, 2018
OneGEA Transformation
Further strategic initiatives
Mid-term financial outlook
Status of OneGEA transformation program and update on level of
implementation of steering systems and IT excellence projects
Outline of ongoing projects such as Global Manufacturing Footprint
and Procurement but also review of further strategic initiatives
concerning topline growth, service, portfolio and further efficiencies
in particular SG&A
New mid-term financial outlook
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