Wuppertal, 9 November 2009 – Most of the GESCO Group companies felt the effects of the recession in the first six months (1 April to 30 September 2009) of the financial year 2009/2010 (1 April 2009 to 31 March 2010). Although some of the Group’s companies saw positive development, most of the 14 operating subsidiaries suffered from the impacts of the massive economic slump
The first six months of the financial year at GESCO Group encompass the months April to September for GESCO AG and January to June for its subsidiaries. The development of operating business therefore falls within the worst period of the recession in Germany and many of the company’s export markets. Figures fell very sharply compared to the same period in the previous year, as during that time the Group still recorded record levels of incoming orders, sales and earnings
The Group reported incoming orders of € 116.2 million, much lower than in the previous year (€ 218.2 million). Sales revenue fell by 27.5 % to € 139.9 million (previous year: € 192.8 million). As expected, key earnings figures suffered greater decreases than sales, as the previous year’s buoyant economy allowed GESCO Group to make optimum use of its capacities and therefore spread fixed costs. Earnings before interest, tax, depreciation and amortisation (EBITDA) totalled € 13.3 million, compared to the same period in the previous year (€ 29.2 million). As depreciation and amortisation remained almost the same, earnings before interest and tax (EBIT) dropped even more sharply to € 8.1 million (previous year: € 24.1 million). Group net income after minority interests amounted to € 4.3 million (previous year: € 13.6 million), while earnings per share pursuant to IFRS totalled € 1.42 (€ 4.51).
Although GESCO Group’s income potential fell way below the record figures of the previous year during the period under review, the company still managed to remain in the black despite the serious recession.
Member of the GESCO Executive Board Dr. Hans-Gert Mayrose on the economic development: “From September 2009, some of the subsidiaries record a slight improvement, partly because many customers have to restock their empty stores. It is our impression that the economic slump has bottomed out. However, future development remains highly uncertain. It is difficult to forecast when the economy will make a sustainable recovery. Although some indicators paint a better picture than only three months ago, the situation in the mechanical engineering industry remains rather difficult.”
At its accounts press conference on 25 June 2009, the company forecast sales between € 280 million and € 310 million, Group net income after minority interests between € 7 million and € 10.5 million, and earnings per share between € 2.31 and € 3.47 for the entire financial year of 2009/2010. The company can confirm this forecast. According to present knowledge, the final figures are likely to be somewhere in the middle of this range.
Read the full interim report here.