From melting steel to 3D-printing: investing in the
technology-driven German “Mittelstand”as at 15 September 2015
GESCO Group – an association of industrial SMEs with market and technology leaders
Segments tool manufacture / mechanical engineering and plastics technology
Currently 17 operating subsidiaries under the roof of GESCO AG as a holding company
We think and act in a sustainable and entrepreneurial manner
We do business in established sectors with innovative technologies
We provide technology “made in Germany” for global markets
GESCO is comprised of adaptable, independent operating units that benefit from being part of a strong group
GESCO AG – a long term investor and a safe haven for succession issues
We acquire and develop industrial SMEs an a long-term basis –exit is not part of the business model
We take over majorities, almost always 100 %
Most takeovers are part of succession planning
The new managing directors invest up to 20 % in the company they run (“entrepreneur companies”)
1. Business model
2
The GESCO share offers a focussed portfolio of 17 “Hidden Champions” serving broadly diversified customer sectors
1. GESCO Group
→
3
3%
5%6%6%
12%
15%
15%
25%
4%
Passenger and commercial vehicles
Other
Agricultural engineering
Machine and plant construction
Foundries and roller millsConsumer goods industry
Iron, plate and metal processing,tool construction
EnergyChemical and petrochemical industryElectrical, medical technology, household goods
Construction, air conditioning, sanitary industry4%
4
1. The 4 biggest companies (sales and staff: FY 2014)
Dörrenberg Edelstahl GmbH
• Leading European specialist for tool steel
• Steel mill, trading, mould castings and surface technology
• Strong internationalization
• Sales € 172 m, staff 501
SVT GmbH
• Systems for (un)loading liquids and gases
• Specialty LNG: No. 2 worldwide
• Export ratio: 80 %
• Sales € 44 m, staff 182
MAE Maschinen- und Apparatebau Götzen GmbH
• World market leader for straightening machines and wheel set presses
• Highly innovative
• Acquired US competitor in Jan. 2014
• Sales € 25 m, staff 160
Frank Walz- und Schmiedetechnik Group
• Europe‘s leading forge for wearparts for the agricultural industry
• 70 % of sales to OEMs, 30 % to wholesale and farmers
• Sales € 28 m, staff 274
5
1. Two very special companies (sales and staff: FY 2014)
Setter Group
• Paper and plastic sticks for the sweets and hygienic industries, world market leader for paper sticks
• 90 % export ratio
• 20 bn sticks produced in Germany each year
• Acquired US-basedSetterstix Inc. in Jan. 2015
• Sales € 15 m, staff 59
C.F.K. CNC-Fertigungs-technik Kriftel GmbH
• Leading centre in high-precision wire erosion and die sinking
• Cutting-edge production line, 45 machines
• Advanced laser meltingsystems (3D printing) forfunctional prototypes, medical implants etc.
• Sales € 8 m, staff 57
Please keep in mind:
GESCO AG and GESCO Group financial year = 1 April to 31 March
Subsidiaries’ financial year = calendar year
6
2. Financial year 2015/2016
2. Financial year 2015/2016
Initial situation and expectations (as at annual accounts press conference on 25 June 2015)
Economic forecasts indicate growth (GDP:+2.1 %, VDMA: Increase in production +2 %, GKV: Sales +2.6 %)
Frank Walz- und Schmiedetechnik GmbH: continued weakness in the agricultural technology sector due to Russia/Ukraine etc.
SVT GmbH: low energy prices lead to restraint in investments of the oil industry decreasing demand for SVT GmbH’s loading arms
Tool manufacturers are expecting decreases in results, partly due to cyclical effects
Restructuring measures at two companies continue to have a negative effect on earnings
Among others, Dörrenberg, Setter, Haseke and CFK are operating at a satisfactory level
Overall sales within the GESCO Group should increase organically, further inorganic growth will be contributed by Setterstix, but margins continue to be far too low
7
2. Financial year 2015/2016
2014/2015Actual figures
2015/2016Target Change
Group sales € million 451.4 480 to 490 6.3 % to 8.5 %
Group net income for the year after minority interest
€ million 12.4 12.5 to 14.0 1.2 % to 13.4 %
Earnings per share acc. to IFRS
€ 3.72 3.76 to 4.21 1.2 % to 13.4 %
Target figures
8
2. Financial year 2015/2016 – Q1
Q1: lively business
Includes operating months January to March 2015 at subsidiaries
Incoming orders show strong growth in first quarter; exceptionally high figure, including large orders which will partly impact sales and earnings only in the next FY
Sales are also up, but earnings continue to be weighed down
Restructuring measures at two subsidiaries make progress, should be largely completed by end of FY
Guidance for full FY confirmed
9
2. Financial year 2015/2016 – Q1
Q12014/2015
Q12015/2016 Change
Order intake € million 126.7 146.1 15.3 %
Sales € million 109.5 118.7 8.4 %EBITDA € million 11.4 11.6 2.0 %EBIT € million 6.9 6.6 -3.3 %Group net incomeafter minority interest € million 3.7 3.2 -15.4 %
EPS acc. to IFRS € 1.13
31.03.2015
0.95
30.06.2015
-15.4 %
Equity € million 182.8 184.5 0.9 %Equity ratio % 45.3 43.2 -Liquid funds € million 35.3 30.7 -12.9 %
10
2. Financial year 2015/2016 – Q2
Q2: customer demand still on a satisfactory level
Includes operating months April to June 2015 at subsidiaries
Order intake approx. € 112 million, +12 % yoy
Sales approx. € 117 million, +6 % yoy
11
2. Financial year 2015/2016
General current situation
Customers’ willingness to invest suffers from general uncertainty
In July 2015 VDMA cut outlook for production from +2 % to zero growth
12
Current situation with regard to M&A
On the one hand: M&A in the “good” SME sector is currently a seller’s market A lot of available funds, low interest rates, few attractive investment
opportunities Comparably small number of interesting SMEs
On the other hand: The market continues to be strongly fragmented at all levels (sellers, intermediaries, buyers), there are still interesting opportunities
GESCO strengthened its team in September 2014 (Christoph Borges, Head of M&A)
3. M&A
13
January 2015: Setter Group acquires Setterstix Corp. / USA
Setterstix is the leading US producer of paper sticks for the confectionary industry with approx. € 10 m sales and 40 employees
GESCO subsidiary Setter is market leader for paper sticks for the hygiene industry in the US acquisition rounds off Setter’s position in the US market perfectly
The companies have common origins, but have been separate companies for decades
3. M&A and portfolio development
14
Free float: 86.4 %
Stefan Heimöller, entrepreneur, member of supervisory board: 13.6 %
Investmentaktiengesellschaft für langfristige Investoren TGV: 8.9 %
Dividend policy: payout ratio approx. 40 % of Group net income after minority interest
4. The GESCO share
15
4. Share price development (in %) – 1 and 5 years
GESCO vs. SDAX, 1 year GESCO vs. SDAX, 5 years
16
─ GESCO─ SDAX
85
90
95
100
105
110
115
120
125
130
135
80
100
120
140
160
180
200
220
4. Share price development (in %) – 10 years
GESCO vs. SDAX, 10 years
17
─ GESCO─ SDAX
0
100
200
300
4. Share price development (in %) – 1 year
18
─ GESCO─ SDAX
80
85
90
95
100
105
110
115
120
125
130
135
Founded: 1989Share capital: € 8,645,000Shares: 3,325,000 registered sharesFree float: 86.4 %Stock markets: Xetra; Frankfurt (regulated market);
Berlin, Düsseldorf, Hamburg, Hanover, Munich, Stuttgart (open market)
Sec. identification number: A1K020ISIN: DE000A1K0201IPO: 24/03/1998 Index: SDAX End of financial year: 31 MarchDesignated sponsors: equinet Bank AG
Oddo Seydler Bank AG
Facts and figures on GESCO AG
19
GESCO Group overview
Company Sales 2014€‘000
Staff31/12/2014
GESCO AG shareholding
Astroplast Kunststofftechnik GmbH & Co. KG 16,646 92 80%
Paul Beier GmbH Werkzeug- und Maschinenbau & Co. KG 9,492 108 100%
C.F.K. CNC-Fertigungstechnik Kriftel GmbH 8,330 57 80%
Dömer GmbH & Co. KG Stanz- und Umformtechnologie 14,719 102 100%
Dörrenberg Edelstahl GmbH 171,683 501 90%
Frank Group 28,225 274 90%
Franz Funke Zerspanungstechnik GmbH & Co. KG 16,861 81 80%
Haseke GmbH & Co. KG 12,742 63 80%
Hubl GmbH 10,806 101 80%
Georg Kesel GmbH und Co. KG 12,454 69 90%
MAE Maschinen- und Apparatebau Götzen GmbH 24,768 160 100%
Modell Technik GmbH & Co. Formenbau KG 13,948 115 100%
Protomaster Riedel & Co. GmbH 8,630 110 82.17%
Setter Group 14,567 59 100%
SVT GmbH 44,104 182 90%
VWH Vorrichtungs- und Werkzeugbau Herschbach GmbH 11,151 109 80%
Werkzeugbau Laichingen Group 25,196 178 85%20
Financial calendar
Financial calendar
1 September 2015 Small Cap Conference, Frankfurt/Main
13 November 2015 Q2 figures (01.04. to 30.09.2015)
24 November 2015 German Equity Forum, Frankfurt/Main
February 2016 Q3 figures (01.04. to 31.12.2015)
30 June 2016 Annual Accounts Press Conference and Analysts’ Meeting
August 2016 Q1 figures (01.04. to 30.06.2016)
25 August 2016 Annual General Meeting
November 2016 Q2 figures (01.04. to 30.09.2016)
21
Investor relations contact
Investor RelationsGESCO AG Phone: +49 202 24820-18 Investor Relations Fax: +49 202 24820-49Oliver Vollbrecht E-mail: [email protected] 7 Internet: www.gesco.de 42103 WuppertalGermany
22
Top Related