GESCO exceeds targets in 2012/2013, plans more cautiously for 2013/2014 and looks to make significant investments


Wuppertal, 11 June 2013 – GESCO Group, an association of industrial SMEs in the fields of tool manufacturing/mechanical engineering and plastics technology, reported today at its accounts press conference that financial year 2012/2013 (1 April 2012 to 31 March 2013) had been a success, presented more cautious planning for the new financial year 2013/2014 and revealed its plans to make significant investments.

Business at most Group companies remained at a high level in 2012/2013 despite a slowdown in demand in the second half of the year. The portfolio was expanded considerably in the reporting year on account of the acquisition of three new companies; one company was sold. At € 439.4 million, incoming orders were nearly on par with the figure in the previous year’s period. Group sales rose by 6.0 % to € 440.4 million (previous year: € 415.4 million). While the material expenditure ratio declined, the personnel expenditure ratio and the share of other operating expenditure increased. Earnings before interest, taxes, depreciation and amortisation (EBITDA) grew slightly by 1.1 % to € 51.8 million (€ 51.2 million). Due to considerable investments in previous years as well as the effects of the first-time consolidation of the newly acquired companies, depreciation and amortisation rose far more rapidly than sales, reaching € 14.4 million (€ 12.1 million). As a result, earnings before interest and taxes (EBIT) fell to € 37.3 million (€ 39.1 million). With a virtually unchanged financial result of € -3.5 million (€ -3.4 million), a slightly higher taxation rate and lower minority interest, Group net income for the year after minority interest reached € 20.9 million (€ 22.5 million). The previous year’s figure contained a positive one-off effect of around € 0.7 million that naturally did not recur. Earnings per share amounted to € 6.30. The previous year’s figure of € 7.40 had been based on a significantly lower weighted average number of shares due to a nearly 10 % increase in share capital at the end of February 2012, shortly before the conclusion of the financial year.

The increase in the Group’s workforce from 1,899 to 2,292 employees was mainly due to the changes in the scope of consolidation.

Thanks to these figures, GESCO Group slightly exceeded its targets most recently confirmed in February 2013. In line with the Group’s long-standing dividend policies calling for the distribution of around 40 % of Group net income after minority interest, the Executive and Supervisory Boards will propose to the Annual General Meeting on 25 July 2013 a dividend of € 2.50 per share. A record dividend of € 2.90 per share was paid in the previous year.

In a difficult general economic environment characterised by uncertainty, the company forecasts Group sales of € 435-450 million for the new financial year 2013/2014 (1 April 2013 to 31 March 2014). Group net income for the year after minority interest is expected to total € 18.5-20.5 million, with some companies reporting declining sales and margins on account of the economic downturn, and because the newly acquired companies will not be able to contribute their full share to Group earnings in the first two years after acquisition due to the effects from the first-time consolidation.

In the first quarter of the new financial year 2013/2014, which includes the operating months January to March 2013 of the Group’s subsidiaries, GESCO Group generated incoming orders of around € 110 million (€ 116.3 million) and sales of around € 108 million (€ 106.8 million). At the end of the first operating quarter, order backlog amounted to more than € 200 million.

GESCO Executive Board member Dr. Hans-Gert Mayrose on the financial statements and the outlook: “In the past financial year, we exceeded our targets slightly and generated the third-best earnings in the history of the company. For the new financial year, we expect declining margins in a difficult, uncertain environment. But uncertain times are also times for entrepreneurial action. Regardless of the detailed performance of the new financial year, we believe firmly in the medium- to long-term opportunities of our Group. We therefore plan to invest the record figure of more than € 30 million in the future development of GESCO Group during financial year 2013/2014. We see 2013/2014 as a year of transition. Should 2014 bring the upswing in the overall economy that many expect, we will be well equipped. And, with the strategic investments we are making this year, we are strengthening the sustainable development of the Group.”  

The complete Annual Report is available here.

The video commentary by Dr. Hans-Gert Mayrose, member of the Executive Board, on financial year 2012/2013 and the outlook can be viewed here.

The accounts press conference and analysts’ meeting will be transmitted as a live webcast on 11 June 2013, starting at 10:30 am at, where it can also be accessed at a later time within the next twelve months.