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Bergisch Gladbach, 11 May 2023

After repositioning: INDUS significantly increases sales and earnings in the first quarter of 2023

- Sales and EBIT up 8.2%
- Forecast confirmed

The INDUS Group portfolio companies clearly expanded their business in the first three months of 2023, when Group sales climbed 8.2% to EUR 450.8 million (previous year: EUR 416.5 million). Organic growth in sales amounted to 6.5%, while recent acquisitions contributed 1.7%. Operating income (EBIT) increased in line with sales to EUR 44.8 million (previous year: EUR 41.4 million). The EBIT margin stood at 9.9% (previous year: 9.9%).

“Our performance in the first quarter reflects the strength of our portfolio in the continuing operations,” says INDUS CEO Dr. Johannes Schmidt. “Despite the difficult economic environment, our 45 portfolio companies have made a good start to 2023.”

Following the decision to streamline the INDUS portfolio by removing the series suppliers to the automotive industry, SELZER, SCHÄFER and SMA (which had already been deconsolidated in the previous year), were reclassified to discontinued operations at the end of 2022. Compared to the same period of the previous year, the negative result of the discontinued operations improved by EUR 11.9 million to EUR -8.9 million (previous year: EUR -20.8 million). The Board of Management is in negotiations for the divestment of SELZER and SCHÄFER and is optimistic that the divestments will be completed before the end of 2023.

The Group’s earnings after taxes rose to EUR 16.0 million in the first quarter (previous year: EUR 4.6 million). Earnings per share stood at EUR 0.60 (previous year: EUR 0.17). At EUR 0.93, the share of the continuing operations remained more or less at the previous year’s level (EUR 0.94).

Operating cash flow rose to EUR 1.5 million (previous year: EUR -17.8 million). With supply chains easing and inflation slowing down, the portfolio companies were able to significantly reduce the typical seasonal increase in working capital compared to the first quarter of 2022. Free cash flow, which was introduced as an additional performance indicator in the context of the “PARKOUR perform” strategy update, amounted to EUR 7.5 million (previous year: EUR – 14.9 million). At 36.4%, the equity ratio stood almost at the same level as at the end of last year (36.3%).

All three new segments increase sales

The companies in the Engineering segment increased their sales to EUR 142.1 million (previous year: EUR 120.4 million). This growth rate of 18.0% is the highest of all three segments. In addition to an organic growth of 12%, the new portfolio companies HEIBER + SCHROEDER and HELD contributed 6.0% to this growth. Operating income (EBIT) rose to EUR 15.6 million (previous year: EUR 14.2 million). As expected, the EBIT margin of 11.0% was slightly below the previous year’s 11.8% due to depreciation and amortization in conjunction with the initial consolidation of HEIBER + SCHROEDER and HELD, but was at the upper end of the target range for the full year (9-11%).

As expected, sales in the Infrastructure segment increased only slightly (+1.4%) to EUR 141.5 million (previous year: EUR 139.5 million). While the slowdown in construction activity has dampened the boom of recent years for some of our portfolio companies in the housing construction sector, energy efficiency retrofits remain a clear growth driver. Operating income (EBIT) stood at EUR 10.7 million (previous year: EUR 16.1 million). The EBIT margin of 7.6% (previous year: 11.5%) is expected to increase to 10–12% in the course of the year. The acquisition of QUICK by INDUS portfolio company BETOMAX further strengthened the Infrastructure segment in the first three months of 2023. QUICK, a specialist for formwork and reinforcement accessories, complements the BETOMAX product portfolio and opens up new market opportunities, especially in the bridge construction sector.

Supported by broad-based organic growth, sales in the Materials segment rose by 6.6% to EUR 166.8 million (previous year: EUR 156.5 million). Operating income (EBIT) climbed to EUR 20.1 million (previous year: EUR 14.0 million). The companies in the segment have now been able to pass on the significant cost increases in 2022 in their sales prices. The EBIT margin of 12.1% (previous year: 8.9%) is unlikely to be maintained at this level for the rest of the year due to the expected price development of some raw materials. For the full year, the Board of Management expects an EBIT margin of between 6% and 8%.

Guidance confirmed – difficult operating environment already taken into account

“Our portfolio companies performed well in the first three months in what remains a challenging environment,” says Dr. Johannes Schmidt. “In the Infrastructure and Materials segment, we have already taken into account the more moderate construction activity and isolated material price increases in our forecast.”

For the full year 2023, the Board of Management continues to expect sales of between EUR 1.9 billion and EUR 2.0 billion and operating income (EBIT) of between EUR 145 million and EUR 165 million. The full interim report is available here. An overview of the key performance indicators is available here.

Axel Meyer

COO Engineering
Axel Meyer (German citizen, born 1968) has been a member of the INDUS Board of Management since October 2017.

Until joining INDUS, he held various management positions at Schuler AG, most recently as Managing Director of Schuler Pressen and Head of the Service Division of the Schuler Group, Goeppingen, Germany.

Previously, Axel Meyer worked as a member of the Board of Management of the international management consultancy IMAGIN Prof. Bochmann AG, Eppstein im Taunus, Germany. He started his professional career in the Schuler Group's Solid Forming Division, initially in global sales and later as Division Manager.

Axel Meyer studied industrial engineering in Germany and the USA and earned a Master of Mergers & Acquisitions (LL.M.) at the Frankfurt School of Finance & Management while working. 

Gudrun Degenhart

COO Materials Solutions
Gudrun Degenhart (German citizen, born 1970) has been a member of the Board of Management of INDUS since October 2023.

She has more than 20 years of experience in the management and development of portfolio companies in Europe, USA and the Asia-Pacific regions.

Before joining INDUS, Gudrun Degenhart was CEO for the German portfolio companies of the international service group ISS. She previously worked for the thyssenkrupp Group, including as CEO of the international business unit for special lifts and as CEO of Materials Western Europe and Asia-Pacific. She gained experience in medium-sized companies as a board member of the construction technology company Schöck.

A graduate in business administration, she began her career by building up the Central and Eastern European activities of the construction specialist Lindner Group. 

Dr. Jörn Großmann

COO Infrastructure
Dr. Jörn Großmann (German citizen, born 1968) has been a member of the INDUS Board of Management since January 2019.

Up until joining INDUS, he worked for the Dutch group Aalberts Industries, with his last position being the sole managing director of Impreglon, Lüneburg, Germany.

He previously held various positions at the Georgsmarienhütte Group, initially becoming managing director of Mannstaedt, Troisdorf, Germany and later managing director of GMH Edelstahl Service Center Burg and GMH Engineering. Before Dr. Großmann became the managing director of Buderus Feinguss, Moers, Germany, he worked as a development engineer and as a technical director for Doncasters Precision Castings, Bochum, Germany.

He studied material sciences and earned a doctorate in the field of natural sciences.

Dr. -Ing. Johannes Schmidt

CEO
Dr. -Ing. Johannes Schmidt (German citizen, born 1961) has been a member of the Board of Management of INDUS since January 2006. He has assumed the position of CEO since July 2018.

Dr. -Ing. Schmidt was previously the sole managing director of ebm-papst Landshut, Germany, a manufacturer of ventilation motors and fans. During his tenure there, his main achievements included advancing the development of new product platforms and the internationalization of production sites.

Dr. -Ing. Schmidt began his career at Richard Bergner, a manufacturer of electrical instruments from Schwabach, Germany. He initially led product development before rising to the position of managing director during his 12 years at the company.

Schmidt, who studied mathematics, gained an engineering doctorate in mechanics from the Technical University of Darmstadt. 

Rudolf Weichert

CFO
Rudolf Weichert (German citizen, born 1963) is the CFO of INDUS.

Before joining the INDUS Board of Management in June 2012, he was a Partner at KPMG for nine years. He spent three of these years in Detroit, Michigan, United States, where he worked mainly with companies in the engineering, and materials trading industries.

Mr. Weichert, who holds a masters degree in business administration, worked for KPMG for about 20 years, primarily in the firm’s Duesseldorf office, where he worked mainly with multinational manufacturing corporations.