What happened?
GEA (G1A) is scheduled to report Q4 2024 earnings on 11 March, 2025. While we have very briefly spoken to IR, the call served to discuss the latest developments since the Q3 release on 6 November and to recap on the latest mgmt. statements that have been made since. The comment below should be read as our interpretation of the discussion rather than specific company commentary. Guidance is unchanged.
BNPP Exane View:
Demand: On earlier earnings calls, mgmt. had pointed to ''a lot of interesting large projects in the pipeline'' and to expect H2 orders above H1 in 2024 implying Q4 orders of EUR 1.35bn, which is where BBG consensus has settled. While the latest PMI and ISM prints do not necessarily call for a strong December-quarter from an order perspective per se, we understand that mgmt. has struck a constructive tone on demand in Q4 lately. Against that backdrop, we consider our unchanged EUR 1.39bn in Q4 as achievable (+10% y/y | +7% q/q).
Sales: Execution-wise we understand that the company has not seen any disruptions from supply chains, while tailwinds from the earlier shift to a new logistics partner in Q1 should continue. We thus expect organic growth to have remained within the guided 2-4% growth corridor for the full-year (BBG: 3.8% in Q4e / 2.5% in FY24e), led by SFT (cf. upgrade in Q2 to 5-8% vs 1-4% before), which is compensating for slow/er growth at LPT (cf. d/g in Q2 to neg. 2%-pos. 2% vs. 2-8%), and not least continued service growth (9M +6% nom. vs. OE down 5% y/y). As FX headwinds should ease somewhat vs 9M, we model Q4 sales of EUR 1.42bn (+1% y/y | +5% q/q) vs. BBG''s forecast of EUR 1.45bn though.
Adj. EBITDA: Our Q4 estimate of EUR 233m / 16.4% margin vs. BBG''s EUR 231m / 15.9% is based on the combination of profitable service growth, moderate SFT related tailwinds, FHT finally starting to catch up and sequentially lower FX headwinds and compares to company guidance of c. EUR 820-850m implying c. EUR 220-250m...
