DGAP-News: 2G Energy AG / Key word(s): Final Results/Quarter Results 2G Energy AG: Good start to FY 2015 with solid order book position 28.05.2015 / 07:30 --------------------------------------------------------------------- * 2G sales revenue record for FY 2014 confirmed: EUR 186.6 million (up 47.9 % year-on-year) * Service business share of revenue grows from EUR 27.4 million to EUR 37.2 million in 2014 * Equity ratio improves to 56.2 %, liquid assets of EUR 11.9 million * Proposed dividend of EUR 0.37 per share * Q1 2015 in line with expectations: Sales revenues of EUR 29 million (previous year: EUR 20 million), EBIT of EUR -0.4 million (previous year: EUR -0.9 million) Heek, 28 May 2015 - 2G Energy AG (ISIN DE000A0HL8N9), one of the leading German manufacturers of combined heat and power (CHP) systems, generated consolidated sales revenues of EUR 186.6 million in the 2014 financial year (as of 31 December), on the basis of audited figures (previous year: EUR 126.1 million). This represents the highest level of sales revenue in the company's twenty-year history. Total operating revenue of EUR 189.6 million was posted (previous year: EUR 137.5 million) as a result of a higher level of inventories and work in progress of EUR 2.9 million (previous year: EUR 11.3 million). The company achieved significantly higher year-on-year earnings before interest and taxes (EBIT) of EUR 11.3 million (previous year: EUR 3.1 million) on the basis of German Commercial Code (HGB) accounting policies, representing a 6.1 % EBIT margin (previous year: 2.5 %). 2G's full-year forecast has been met as a consequence. Consolidated net income amounts to EUR 6.9 million for 2014 (previous year: EUR 1.0 million), with earnings per share standing at EUR 1.47 after minority interests (previous year: EUR 0.20). The order book position for CHP systems of EUR 42.3 million as of 31 December 2014 (2013: EUR 46.0 million) comprises work in progress on plants as well as new plant business of EUR 17.4 million (previous year: EUR 18.1 million). Good start to a solid FY 2015 2G generated EUR 28.9 million of sales revenues in the first quarter of 2015 (previous year: EUR 20.0 million), which also derives from the previous year's EUR 42.3 million overhang of CHP system orders. In line with the sales revenue trend, work in progress reduced by EUR 1.5 million as of the reporting date, with total operating revenue consequently amounting to EUR 27.4 million. The company incurred a loss of EUR 0.4 million (previous year: loss of EUR 0.9 million) at the earnings before interest and tax (EBIT) level. This result is primarily attributable to materials purchasing and preliminary work for orders newly acquired in 2015. The related costs are recognised immediately, although the sales revenue and earnings effects will not arise until after commissioning/acceptance occurs during subsequent quarters of 2015, reflecting the unchanged application of German Commercial Code (HGB) accounting policies in this respect. The order book position for CHP systems amounted to EUR 46.3 million on 31 March 2015, compared with a much higher level of EUR 102 million on the previous year's reporting date, which was attributable to accelerated purchasing effects before the amended German Renewable Energies Act (EEG) 2014 came into effect, thereby limiting the ability to make a direct comparison (representative 31 March 2013 reporting date comparison: EUR 46.5 million). As of the end of April 2015, the order book position for the supply of 2G CHP systems stood at a good level of around EUR 54 million (previous year: around EUR 115 million, on 30 April 2013: around EUR 53 million). Almost in parallel with the previous year, the order book position is divided into approximately 56 % natural gas operated and 44 % biogas operated CHP plants, and 73 % of the order book position derives from Germany. The foreign share of orders for CHP in the order book position of 27 % (excluding USA) arises mainly from United Kingdom, Eastern European countries, and Italy. Signals from the American market are encouraging following the complete takeover of the 2G Cenergy subsidiary and the change of management. At the end of May 2015, its order book position amounted to USD 10.6 million, which is planned to become effective in terms of sales revenues and earnings during the current financial year. Three quarters of the CHP systems that have been ordered are natural gas operated. The order pipeline of 2G Cenergy is also well filled, allowing the Management Board to anticipate the announcement of further intake of new orders over the course of the 2015 financial year. Overall, the Management Board appraises the starting position for Group sales revenue and earnings trends as being good. For the 2015 financial year, the Management Board expects to achieve sales revenues of between EUR 140 million and EUR 160 million, and an EBIT margin between 5 % and 7 %. FY 2014 characterised by accelerated purchasing effects on German market and significant sales growth in UK The first seven months of the 2014 financial year were affected by accelerated orders for CHP systems in Germany due to the amendment to the German Renewable Energies Act (EEG) as of 1 August 2014. Business in Germany for both biogas and natural gas operated CHP modules was correspondingly strong compared with international markets. The foreign share of sales revenues of around 21 % (previous year: 22 %) nevertheless remained almost unchanged year-on-year. This gives a strong indication that the company's strategy of continuously diversifying across gas types and regions is being implemented successfully. The United Kingdom comprised the strongest foreign sales market in the 2014 financial year with sales revenues of EUR 14.9 million (previous year: EUR 1.7 million). UK subsidiary 2G Energy Ltd. consequently contributed an approximately 8 % share to total consolidated revenue. Sales revenues of EUR 6.3 million from the US business (consolidated through 2G Manufacturing Inc.) fell short of expectations, by contrast (previous year: EUR 4.0 million). At the end of February 2015, 2G acquired all of the shares in 2G Cenergy in the USA, with the previous majority shareholders having meanwhile left the company. A new management team is now responsible for its operating activities on a standard Group basis. Its sales and marketing base is to be widened, and the capacity utilisation of subsidiary 2G Manufacturing is to be boosted. Sales on other foreign markets performed in line with expectations. The company has initiated the transformation process to utilise natural gas operated CHP systems in countries such as the United Kingdom, Italy and other Southern European countries. The Group is supporting this process with restructuring and sales measures. 2G Italia Srl, for example, has already grown its sales revenues from EUR 2.4 million in the previous year to EUR 4.3 million. Given strong corporate growth, 2G's production capacities at Group headquarters in Heek were utilised over the full course of the year. In this context, 52 % of Group-wide sales revenues were attributable to biogas operated 2G systems, and 48 % to natural gas operated systems. Internationally, 83 % of sales are derived from biogas operated CHP modules (previous year: 93 %), while in Germany sales revenues were dominated by natural gas operated systems with a 60 % share (previous year: 51 %). Growing demand from abroad for natural gas operated CHP power plants is also significantly evident for the first time with a 17 % share (previous year: 7 %). 2G sold a total of 608 units in the 2014 financial year in Germany and abroad (previous year: 445 units). Service business grows above-average at 36 % The percentage distribution of sales between the product areas of CHP Systems, Service and After-Sales remained relatively constant in the reporting year compared with the previous year. The share of the CHP Systems area was unchanged at 72 %, the share of the Service business fell slightly to 20 % due to the markedly higher total sales level (previous year: 22 %), and the share of sales from the After-Sales business increased slightly from 6 % in the previous year to 8 %. In absolute terms, however, the Service and after-Sales areas continued to report further growth, generating a EUR 51.6 million revenue sales share (previous year: EUR 35.9 million). In particular, servicing of 2G systems is registering significant expansion as a result of the installed base of new plants. At EUR 37.2 million, 2G generated a 36 % higher sales revenue contribution in 2014 compared with the previous year. For 2G, this signifies a stabilising level with continuous and calculable cash flows that are independent of short-term sales trends or regulatory factors. Cost of materials ratio unchanged, personnel cost ratio down The cost of materials ratio of 70.7 % of total operating revenue (previous year: 70.5 %) remained constant due to identical order-related manufacturing and value creation, as well as an unchanged purchasing structure. Assisted by the high capacity utilisation level, the personnel cost ratio fell from 15.6 % in the previous year to 13.4 % (measured in terms of total operating revenue). 2G hired qualified staff particularly for the Service and Sales area, and for international growth. The number of Group staff increased by 62 to 580 (as of the reporting date). In line with the further internationalisation of operating activities, sales, operating and administrative expenses increased year-on-year to EUR 12.9 million (previous year: EUR 10.5 million). The net financial result of EUR -0.3 million is almost neutral, as in the previous year. Given the positive earnings trends, the Group incurred EUR 4.1 million of taxes on income (previous year: EUR 1.8 million). Healthy balance sheet structure, equity ratio improves further to 56.2 % The balance sheet structure of the 2G Energy Group remained very stable during the 2014 financial year. Total assets were up by 4.5 % compared with the previous year to EUR 92.6 million, reflecting a higher inventories position as of the reporting date. Fixed assets of EUR 22.7 million were almost unchanged across all balance sheet items (previous year: EUR 21.9 million). As far as current assets are concerned, raw materials and supplies increased due to the equipping of the main and service warehouses. Work in progress amounted to EUR 26.4 million as of the balance sheet date (previous year: EUR 23.5 million). Prepayments received of EUR 20.3 million were offset against orders being processed (previous year: EUR 17.7 million). The receivables and other assets position amounts to EUR 25.7 million as of the balance sheet date (previous year: EUR 26.8 million). Working capital (difference between current assets and short-term liabilities) of EUR 32.0 million reflects a slight increase compared with the previous year's EUR 28.8 million. Liquid assets were up by around 14 % to EUR 11.9 million compared with EUR 10.4 million as of the previous year's reporting date. The equity of the 2G Group stood at EUR 52.1 million on the balance sheet date (previous year: EUR 47.2 million), with the equity ratio having improved further from 53.2 % on the previous year's reporting date to 56.2 %. As scheduled, 2G paid down bank borrowings by EUR 1.1 million in the reporting year to EUR 6.1 million. Management and Supervisory board's propose EUR 0.37 dividend After approving and adopting the 2014 annual financial statements, the Supervisory Board at its 26 May 2015 meeting concurred with the Management Board's proposal to propose that the 2014 AGM should again approve a EUR 0.37 dividend per share. With a view to the very solid business growth anticipated for the current year, the Supervisory and Management boards are thereby focusing on dividend continuity in the context of a long-term payout policy. 2014 Annual Report download The company has made its detailed annual report for 2014 available for downloading from http://www.2-g.de/?langid=1&seitenid=86. The annual report will also be available in English from mid-June. 2G company portrait 2G Energy AG is amongst the world's leading manufacturer of cogeneration systems (CHP) for decentralized energy production and supply by means of combined heat and power. The company's product portfolio includes systems with an electrical capacity between 20 kW and 4,000 kW for the operation with natural gas, biogas or bio methane and other lean gases. So far, 2G was able to successfully install thousands of CHPs in 35 countries. Especially, in the performance range of 50 kW to 550 kW 2G possesses own technological combustion engine concepts characterized by low specific fuel consumptions, a high operational availability and optimized service intervals. Next to the main production site at its headquarter in Heek, Germany, the company has invested in an additional production and sales & service site in St. Augustine, Florida, USA. 2G's customers range from farmers to industrial clients, municipalities, real estate industry, up to municipal utilities and big utility companies. The high level of customer satisfaction is founded on the close-knit service network as well as the high technical quality and performance of 2G power stations. Thanks to the combined heat and power performance they achieve an overall degree of efficiency between 85 percent and well above 90 percent. To further enlarge the technologically leadership the company continuously invests in its R&D activities for gas engines for the use of natural gas, biogas and synthetic gases (e.g. hydrogen). Next to the construction of combined heat and power stations, the company, located in Westphalia in the north-west of Germany, offers integrated solutions reaching from the planning stage and installations to serial service and maintenance work. Due to its decentral locations, scalability and projectable availability combined heat and power stations shall play a crucial role as part of intelligent networked energy systems - so called virtual power stations - within the ongoing switch to clean energy and within modern concepts of energy supply. 2G Energy (ISIN DE000A0HL8N9) is listed in the Entry Standard of Deutsche Börse AG, Frankfurt. It's shares are traded on XETRA as well as in the OTC markets of Frankfurt, Düsseldorf and Stuttgart exchanges. The share capital amounts to EUR 4,430,000, and is split into 4,430,000 shares. As of December 31, 2014, the company's founders held 56.1 % of the shares, with the free float amounting to 43.9 %. 2015 dates 8 July 2015 Ordinary AGM, Ahaus 9 July 2015 Dividend payment, subject to AGM resolution 29 September 2015 Half-yearly consolidated financial statements as of 30 June 2015 23-25 Nov. 2015 Germany Equity Capital Forum 2015 End Nov. 2015 Key Q3 figures and business trends

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2G Energy AG Investor Relations Benzstraße 3 48619 Heek Telephone: +49 2568 9347-2795 Telefax: +49 2568 9347-15 E-Mail: [email protected] www.2-g.de --------------------------------------------------------------------- 28.05.2015 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------- Language: English Company: 2G Energy AG Benzstr. 3 48619 Heek Germany Phone: +49 (0)2568-9347-0 Fax: +49 (0)2568-9347-15 E-mail: [email protected] Internet: www.2-g.de ISIN: DE000A0HL8N9 WKN: A0HL8N Listed: Regulated Unofficial Market in Berlin, Dusseldorf, Stuttgart; Open Market (Entry Standard) in Frankfurt End of News DGAP News-Service --------------------------------------------------------------------- 362441 28.05.2015