3W Power/AEG Power Solutions reports results for Q1 2017

18-05-2017 , Luxembourg / Zwanenburg, The Netherlands

- Order intake increases in Q1 2017 by 20.5% compared to Q4 2016

- Revenue suffered due to the business disruption under the protective shield, backlog end of March amounts to €97.7 million, Revenue recognition resulting at € 33.5 million

- Finalisation of the Protective Shield and better opening backlog will lead to improved revenues

- Cash position of € 16.8 million

- Paul van der Harten hired as Group CFO

 

    

  • Order intake increases in Q1 2017 by 20.5% compared to Q4 2016
  • Revenue suffered due to the business disruption under the protective shield, backlog end of March amounts to €97.7 million, Revenue recognition  resulting  at € 33.5 million
  • Finalisation of the Protective Shield and better opening backlog will lead to improved revenues
  • Cash position of € 16.8 million
  • Paul van der Harten hired as Group CFO    

 

3W Power S.A. (ISIN LU1072910919, 3W9K), the holding company of AEG Power Solutions Group, a global provider of UPS systems and power electronic solutions for industrial, commercial, renewable and distributed energy markets, today announced itsunaudited pro forma results for Q1 2017. The “unaudited pro forma” figures include full consolidation of AEG PS GmbH.  

 

Group results *

(in Euro million)

Q1 2017

Q1 2016

Δ in %

Q1 2017

Q4 2016

Δ in %

Order backlog

97.7

92.6

5.5

97.7

86.6

12.8

Orders

46.3

51.5

   -10.2

46.3

38.4

20.5

Revenue

33.5

37.1

-9.7

33.5

46.1

-27.2

Book to Bill

1.38

1.39

-0.5%

1.38

0.83

65.5

EBITDA

(6.1)

0.4

 

(6.1)

(0.6)

 

EBITDA margin

-18.3%

1.1%

 

-18.3%

-1.3%

 

Normalized EBITDA

(2.7)

(3.6)

25.0%

(2.7)

1.4

 

Normalized EBITDA margin

-8.1%

-9.7%

 

-8.1%

3.0%

 

                 * Q1 2017 and Q4 2016 figures include full consolidation of AEG PS GmbH

 

Industrial Products and Services (IPS) *

(in Euro million)

Q1 2017

Q1 2016

Δ in %

Q1 2017

Q4 2016

Δ in %

Order backlog

97.7

92.6

5.5

97.7

86.6

12.8

Orders

46.3

51.5

-10.2

46.3

38.4

20.5

Revenue

33.5

37.1

-9.7

    33.5

46.1

-27.2

Book to Bill

1.38

1.39

-0.5

1.38

0.83

65.5

EBITDA

(5.2)

(2.9)

 

(5.2)

1.0

 

EBITDA margin

-15.4%

-7.8%

 

-15.4%

2.1%

 

Normalized EBITDA

(1.5)

(2.6)

43.1

(1.5)

2.4

 

Normalized EBITDA margin

-4.5%

-7.1%

 

-4.5%

5.1%

 

 

* Q1 2017 and Q4 2016 figures include full consolidation of AEG PS GmbH

 

Unallocated *

(in Euro million)

Q1 2017

Q1 2016

Δ in %

Q1 2017

Q4 2016

Δ in %

EBITDA

(0.9)

3.3

 

(0.9)

(1.6)

39.4

Normalized EBITDA

(1.2)

(1.0)

-22.9

(1.2)

(1.0)

-22.9

 

* Q1 2017 and Q4 2016 figures include full consolidation of AEG PS GmbH

 

Orders by geographical area (Quarterly comparison)*

(in Euro million)

Q1 2017

Q1 2016

Δ in %

Q1 2017

Q4 2016

Δ in %

Orders

 

 

 

 

 

 

Europe excl. Germany

18.3

27.5

-33.5

18.3

16.6

10.2

Germany

12.7

9.7

30.9

12.7

8.6

47.7

Asia

7.0

8.0

-12.5

7.0

7.2

-2.8

Africa/Middle East

6.

5.0

28.0

6.4

5.4

18.5

Rest of the world

1.8

1.3

38.5

1.8

0.5

 

Order total

46.3

51.5

-10.1

46.3

38.4

20.6

Of which Products

30.4

35.6

-14.6

30.4

26.5

14.7

Of which Services

15.9

15.9

0.0

15.9

11.9

33.6

                 * Q1 2017 and Q4 2016 figures include full consolidation of AEG PS GmbH

 

               All numbers are rounded to millions.    

 

AEG Power Solutions finished Q1 2017 with €46.3 million in orders and €33.5 million in revenue. Compared to Q1 2016, orders were slightly down 10.2% (Q1 2016: €51.5 million) and revenue was down 9.7% (Q1 2016: €37.1 million).  However, despite challenging market conditions, the Company posted its higher order intake compared to Q4 2016 as planned.  
    

Group EBITDA for Q1 2017 was €-6.1million compared to  Q1 2016 EBITDA of  €0.4 million. The first quarter Normalized EBITDA, which is EBITDA adjusted for one-time transactions was -€2.7 million, up 25.0% compared  to -€3.6 million in Q1 2016. The reported EBITDA of Q1 2016 includes a capital gain from the sale of Fluxpower GmbH and Primetech Srl. of €4.9 million in February 2016. The Group’s cash position was €16.8 million as at 31 March 2017, compared to  €14.9 million as at December 31, 2016 (March 31, 2016: €31.2 million).  The results for Q1 and Q2 2017 are impacted by the Group’s decision to enter into protective shield proceedings in the Company’s largest subsidiary in Germany.  The Company believes that the long term benefits outweigh the negative impact on the business in the short term.   
   

There is still a certain resiliency in the Oil & Gas markets but the company definitely observes a shift to Gas infrastructure.  There is also a much greater activity amongst EPC’s based in middle east/far east including China vs traditional western participants.  The Company benefits from good diversification both in terms of product offering and geographic reach which contributes to a certain stability.  Still, “quarterly results do not indicate a trend” says Jeffrey Casper, CEO.  “One must look at 2-3 quarters of data to get a realistic view of the overall direction of our business.  We are encouraged by the strong order intake for Q1 2017, we have a healthy backlog.  Our margins will improve as we focus on continuous  improvement in processes and cost optimization.”      
   

The Company is also pleased to announce that Paul van der Harten, joined the company on May 1, 2017.  He will assume full time duties as group Chief Financial Officer on July 1, 2017.  Paul joins the Company after a long career in the Oil & Gas industry.  He has held several senior finance positions with Shell and has spent the last five years with OMV in part as their Chief Financial Officer for the Group’s Exploration and Production division.   Jeffrey Casper states: “Paul brings a wealth of experience and a unique skill set that will greatly benefit AEG’s effort to become an integrated and multi national enterprise focused on customers and markets within critical infrastructure.  We are fortunate to have someone of Paul’s stature joining the team”                 

    

Outlook

Further improvement in profitability is expected in 2017.  The Company is lean, most business activities are now core to the company’s strategy, and the priority is now to grow.  Execution focused on order fulfillment and improvements in quality and customer satisfaction will be key to achieving success.    


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3W Power/AEG Power Solutions reports results for Q1 2017

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Hillermann Consulting - Investor Relations

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This communication does not constitute an offer or the solicitation of an offer to buy, sell or exchange sany securities of 3W Power. This communication contains forward-looking statements which include, inter alia, statements expressing our expectations, intentions, projections, estimates, and assumptions. These forward-looking statements are based on the reasonable evaluation and opinion of the management but are subject to risks and uncertainties which are beyond the control of 3W Power and, as a general rule, difficult to predict. The management and the company cannot and do not, under any circumstances, guarantee future results or performance of 3W Power and the actual results of 3W Power may materially differ from the information expressed or implied in the forward-looking statements. As a result, investors are cautioned against relying on the forward-looking statements contained herein as a basis for their investment decisions regarding 3W Power. 3W Power undertakes no obligation to update or revise any forward-looking statement contained herein.