DGAP-News: BAUER Aktiengesellschaft: BAUER AG with further increased operating profitability in the financial year 2018

- Total Group revenues in line with the last forecast at EUR 1,686.1 million (previous year: EUR 1,772.0 million); sales revenues at EUR 1,589.1 million (previous year: EUR 1,667.9 million)

- EBIT increased by 11.7% to EUR 100.1 million; earnings after tax increased to EUR 24.1 million (previous year: EUR 3.7 million).

- Order intake developed at a high rate at EUR 1,721.9 million; order backlog of EUR 1,013.6 million up 3.7% from the previous year

- Proposed dividend for 2018: EUR 0.10 per share

- Forecast for 2018: Group expects total Group revenues of around EUR 1.7 billion and EBIT of about EUR 95 million. Earnings after tax are expected to be significantly higher than in the previous year.

Schrobenhausen / Munich - The BAUER Group continued to increase its operating profitability in the financial year 2018. Although total Group revenues declined, it was able to achieve its earnings targets. "We are satisfied with the previous financial year, but we want to continue to improve", says Michael Stomberg, who took over the position as Chairman of the Management Board of the international construction and machinery manufacturing concern at the beginning of November and today presented the balance sheet for the first time. His summary of the first few months: "The company is strategically well positioned and our three segments - Construction, Equipment and Resources - will continue to shape the direction of the Group in the coming years. It is well known that we have to do our homework, especially when it comes to Resources. I also see potential for cross-company collaboration in terms of development, innovation and digitalization."

On its way to sustainably increasing its operating profitability, BAUER AG once again made progress in the past financial year. At EUR 1,686.1 million, total Group revenues were 4.9% lower than in the previous year (EUR 1,772.0 million) and thus in line with the latest forecast from November 2018. Sales revenues amounted to EUR 1,589.1 million (previous year: EUR 1,667.9 million). EBIT increased by 11.7% from EUR 89.6 million to EUR 100.1 million. Earnings after tax increased substantially from EUR 3.7 million to EUR 24.1 million. In comparison to the previous year, it should be noted that two significant effects impacted the key earnings figures for 2017: significant currency losses as well as a necessary reassessment of receivables from arbitration proceedings in Hong Kong in the construction segment.

The order situation provides a good basis for further development. At EUR 1,721.9 million (previous year: EUR 1,741.7 million), order intake in 2018 was at a high level. The order backlog, which is relatively evenly distributed across the regions of the world, increased by 3.7% to EUR 1,013.6 million.

The Management Board and Supervisory Board will propose to the Annual General Meeting that a unchanged dividend amounting to EUR 0.10 per share should be paid for 2018.

Business segments
With its three segments - Construction, Equipment and Resources - and more than 110 subsidiaries as well as its broadly diversified business model, the Group operates in some 70 countries around the world.

The construction markets worldwide showed unabated growth overall. There is a great need for infrastructure such as roads, bridges, dams or power supply infrastructure. Increasing urbanization brings an increased need for specialist foundation engineering services which enable buildings to be erected in increasingly complex and difficult conditions.

This benefits the Construction segment. In 2018, projects were successfully completed both economically and technically. However, the segment was unable to match the exceptionally strong previous year in terms of total Group revenues. In the course of the year there was too little utilization and too many project postponements. A major project in the Middle East was suddenly and completely shut down shortly before it began.

As a result, the target for total Group revenues could not be achieved as planned: it amounted to EUR 767.6 million and was thus 8.1% below the previous year's figure of EUR 835.0 million. By contrast, EBIT increased significantly to EUR 39.1 million (previous year: EUR 19.6 million) and earnings after tax to EUR 9.6 million (previous year: EUR -15.2 million). The fourth quarter in particular contributed significantly to revenue and earnings thanks to the completion of major projects.

The order backlog of EUR 547.3 million was 11.1% above the previous year's EUR 492.7 million and is thus a good basis for the current financial year.

The Equipment segment continued its positive development and continued to record strong demand for large and special equipment and after-sales services. The main drivers were the sales markets in Europe and Asia, especially China. Total Group revenues fell slightly by 4.2% from EUR 754.5 million to EUR 723.1 million. Sales revenues also fell by 3.2%, from EUR 660.9 million to EUR 640.1 million. Accordingly, EBIT dropped slightly from EUR 80.6 million to EUR 74.9 million and earnings after tax from EUR 41.0 million to EUR 34.0 million. The earnings figures were influenced by additional depreciation of deep drilling rigs amounting to approximately EUR 15 million.

Order intake totaled EUR 723.7 million, 4.8% down from the previous year's EUR 759.9 million. Order backlog at the end of the year was EUR 149.9 million, remaining approximately at the previous year's level of EUR 149.3 million.

The Resources segment fell short of expectations in 2018 and closed again with significant losses. These originate mainly from the well drilling subsidiary in Jordan and were caused by overcapacity. In addition, there were project losses in the brewery and beverage technology business. The environmental technology, which has been profitable for several years and is the core business of the segment, however could not compensate for these losses.

Total Group revenues increased by 5.3%, from EUR 248.2 million in the previous year to EUR 261.5 million. EBIT decreased slightly from EUR -10.0 million to EUR -11.0 million and earnings after tax were up from EUR -22.4 million in the previous year to EUR -16.0 million.

Order intake 2018 of EUR 242.2 million was 20.6% below the previous year's level of EUR 305.2 million. This was mainly attributable to the very high order intake of the previous year, which included the major contract to expand the reed bed treatment plant in Oman, a project worth roughly EUR 160 million. At EUR 316.5 million, the order backlog at the end of the year was down 5.7% from the previous year's EUR 335.8 million.

Net debt was again significantly reduced

The business model of the BAUER Group is characterized by a considerable need for pre-financing. This typically entails high levels of debt. In the year under review, this was again reduced by 5.4%: At EUR 561.9 million (previous year: EUR 593.7 million), net debt was at its lowest level since 2012. Debt was already reduced by 12.3% in the previous year. At 26.5%, the equity ratio was up from the previous year's level of 25.9%.

Outlook

For the current financial year, the Group expects total Group revenues of around EUR 1.7 billion and EBIT of around EUR 95 million. Earnings after tax are expected to be significantly higher than in the previous year.

"Our order situation is good, the construction markets are developing solidly, and we are focusing on important topics for the future with environment and water. That's why we expect our business model to be robust in 2019," says Michael Stomberg. "Our focus is still on further improvement of earnings after tax, which is also reflected in our forecast. We're confident that we will be able to make significant progress towards positive operative results in the Resources segment."

The full Annual Report, including a detailed analysis of the individual segments and markets, can be found on the website at http://www.bauer.de.

About Bauer

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 extraction of natural resources. In the Resources segment, Bauer focuses on highly innovative products and services in the areas of water, environment and natural resources.

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 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 2018 it employed some 12,000 people in around 70 countries and achieved total Group revenues of EUR 1.7 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.

GROUP KEY FIGURES 2018 (IFRS)

	2017	2018	Change
	in EUR million	in EUR million
Total Group revenues	1,772.0	1,686.1	-4.9%
of which
- Germany	477.8	467.1	-2.3%
- International	1,294.2	1,219.0	-5.8%
of which
- Construction	835.0	767.6	-8.1%
- Equipment	754.5	723.1	-4.2%
- Resources	248.2	261.5	+5.3%
- Other/Consolidation	-65.7	-66.1	n/a
Sales revenues	1,667.9	1,589.1	-4.7%
Order intake	1,741.7	1,721.9	-1.1%
Order backlog	977.8	1,013.6	+3.7%
EBITDA	182.6	198.6	+8.8%
EBIT	89.6	100.1	+11.7%
EBIT margin (as percent of sales revenues)	5.4%	6.3%	n/a
Earnings after tax	3.7	24.1	n/a
Total assets	1,617.7	1,632.3	+0.9%
Equity ratio	25.9%	26.5%	n/a
Earnings per share in EUR	0.16	1.32	n/a
Employees (average number during the year)	10,913	11,643	+6.7%

Contact:
Christopher Wolf
Investor Relations
BAUER Aktiengesellschaft
BAUER-Strasse 1
86529 Schrobenhausen, Germany
Phone: +49 8252 97-1797
investor.relations@bauer.de
www.bauer.de