DGAP-News: BAUER Aktiengesellschaft / Key word(s): Half Year Report/Half Year Results
Schrobenhausen, Germany – The BAUER Group recorded an increase in total Group revenues by 9.6% for the first half of the year compared to the same period of the previous year, from EUR 767.4 million to EUR 841.4 million, despite very different revenues in the business divisions. This was primarily attributable to the Equipment segment. “The Equipment segment continued the positive trend with regard to revenue, earnings and order intake,” explained Michael Stomberg, CEO of BAUER AG. “Although the Construction segment was able to slightly increase the revenue as planned, the earnings performance was below our expectations. The Resources segment was also below planned levels in the first half of the year.”
Although the Group's EBIT, at EUR 12.4 million, was below the previous year's value of EUR 15.3 million, the earnings after taxes improved considerably to EUR 12.4 million (previous year: EUR -5.6 million). This was due, on the one hand, to a noticeable increase in the Equipment segment, and on the other hand to the Group's financial result increasing considerably. In this context, interest rate hedging transactions had a significantly positive influence, as these were valued in the balance sheet according to the development of market interest rates and the market interest rates have increased very markedly compared to the end of 2021. As a result, this created a significant positive effect of EUR 15.5 million on earnings after taxes in the first half of the year (same period of the previous year: positive effect of EUR 1.6 million).
The order backlog in the Group increased by 17.9% compared with the previous year, from EUR 1,279.4 million to EUR 1,508.4 million, and is therefore once again above the record figure of EUR 1,478.5 million reported at the end of the first quarter. Here, the order backlogs in all three segments increased considerably.
With its three segments – Construction, Equipment and Resources – and a broadly diversified business model, Bauer address major global trends such as rapidly progressing urbanization, infrastructure expansion, water extraction and treatment as well as climate change and increasing environmental awareness.
At EUR 367.0 million, total Group revenues in the Construction segment were up slightly by 2.3% compared to the previous year at EUR 358.6 million. EBIT decreased compared to the same period in the previous year, from EUR 2.5 million to EUR -4.5 million. Earnings after taxes amounted to EUR -4.1 million (previous year: EUR -5.5 million).
Overall, the Construction segment recorded a mixed first half of the year. The revenue performance was in line with the planned levels, but the earnings remained behind the expectations.
Due to the subdued operative performance, rigorous work is underway to optimize the international position and earnings growth.
Order backlog in the Construction segment grew considerably by 14.4% from EUR 791.9 million in the previous year to EUR 906.1 million. The increase is mainly attributable to new projects in the USA as well as in the Middle East. At EUR 427.6 million, order intake was on a par with the previous year’s value of EUR 429.2 million.
At the end of the first half of the year, total Group revenues in the Equipment segment increased by 19.8%, from EUR 314.4 million to EUR 376.7 million, when compared to the same period of the previous year. EBIT increased considerably compared to the previous year, from EUR 8.4 million to EUR 19.4 million, as did earnings after tax, which improved from EUR 1.3 million to EUR 14.1 million.
The Equipment segment recorded a very positive first half of 2022 and was able to continue the positive trend regarding revenue, earnings and order intake that began in the fourth quarter of 2021.
Order backlog increased significantly by 33.4%, from EUR 167.6 million in the previous year to EUR 223.6 million. At EUR 422.5 million, the order intake rose by 16.3% compared to the previous year’s EUR 363.2 million.
At EUR 133.8 million, total Group revenues in the Resources segment were down by 3.2% after the first half of the year, compared to the previous year’s EUR 138.2 million. EBIT decreased from EUR 4.8 million to EUR 0.2 million, and earnings after tax went from EUR 2.9 million to EUR -1.4 million.
The Resources segment started the current year in line with plans, but is behind expectations after the first half of the year. The earnings performance is influenced above all by the area of drilling services. In Jordan, two large-scale projects were postponed to next year due to a lack of funding. The local presence in South Africa was abandoned, since the market opportunities have weakened considerably. Overall, the deviation in earnings can be explained by these two effects.
In the other business areas of water well construction, environmental services, constructed wetlands, mining and rehabilitation, there has been good operative performance with very good results in some places.
At the end of the first half of the year, order backlog increased by 18.4%, from EUR 319.9 million to EUR 378.7 million, which is primarily attributable to the area of rehabilitation. The order intake rose by 26.2% from EUR 135.7 million to EUR 171.3 million.
The outlook for the 2022 financial year remains unchanged. The company expects that the COVID-19 pandemic will remain a potential influencing factor and may also affect the business.
Russia’s war against Ukraine is a considerable factor of uncertainty for the future course of business in 2022.
There are also ongoing bottlenecks, which would primarily affect production and sales in the Equipment segment and could potentially have a negative impact on planned growth. “From today's perspective, however, we are also assuming here that we will be able to maintain our ability to deliver,” says Michael Stomberg. Additional uncertainties for the further course of the business year are a result of the rising interest rates, a generally inhibited global economy and high inflation.
“The development in the first half of the year indicates a shift from our expectations for the individual segments,” says Michael Stomberg. “The Equipment segment is performing better than forecast and our outlook for the second half of the year is somewhat more optimistic than three months ago. Development in the Construction and Resources segments, in contrast, remains behind the expectations on the earnings side. Overall, however, this does not mean any change to our estimates for the Group. As outlined in the 2021 Annual Report, we therefore continue to expect a significant increase in total Group revenues and EBIT.”
The BAUER Group is a leading provider of services, equipment and products related to ground and groundwater. With over 110 subsidiaries, Bauer operates a worldwide network on all continents.
The operations of the Group are divided into three future-oriented segments with a high potential for synergy: Construction, Equipment and Resources. The Construction segment offers new and innovative specialist foundation engineering services alongside the established ones, and carries out foundation and excavation work, cut-off walls and ground improvements worldwide. Bauer is a world market leader in the Equipment segment and provides a full range of equipment for specialist foundation engineering as well as for the exploration, mining and exploitation of natural resources. The Resources segment delivers innovative products and services and acts as a service provider with several business divisions and subsidiaries in the areas of drilling services and water wells, environmental services, constructed wetlands, mining and rehabilitation.
Bauer profits greatly from the collaboration between its three separate business divisions, enabling the Group to position itself as an innovative and highly specialized provider of products and services for demanding projects in specialist foundation engineering works and related markets. Bauer therefore offers appropriate solutions for the world’s major challenges, such as urbanization, growing infrastructure needs, the environment, and water, oil and gas.
The BAUER Group was founded in 1790 and is based in Schrobenhausen, Bavaria. In 2021, it employed some 12,000 people in around 70 countries and achieved total Group revenues of EUR 1.5 billion. BAUER Aktiengesellschaft is listed in the Prime Standard segment of the German stock market.
More information can be found at http://www.bauer.de.
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11.08.2022 CET/CEST Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
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