DGAP-News: 2G Energy AG / Key word(s): Half Year Results 2G Energy AG shows considerably increased total operating revenue and improved earnings in the first half of 2016 27.09.2016 / 08:05 The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- - 2G grew in the first half of 2016: consolidated sales revenues rose by 8% to EUR 63.8 million and total operating revenue increased by 37% to EUR 85.5 million. - The EBIT as of June 30 improved to minus EUR 2.4 million (previous year: minus EUR 3.9 million) and is marked by a large inventory build- up during the first half of the year . - The order book position as of June 30, 2016 grew to EUR 106.4 million (previous year: EUR 76.2 million). 2G Energy AG (ISIN DE000A0HL8N9), one of the internationally leading manufacturers of gas driven combined heat and power plants (CHP systems), increased consolidated sales revenues in the first half-year of 2016 to EUR 63.8 million, and total operating revenue to EUR 85.5 million. Due to the increased inventory of work-in-progress, which was further reflected in the large order book position, the company - as in previous years - still showed a negative EBIT result as of the half-yearly balance sheet date. However, the EBIT of minus EUR 2.4 million as of June 30, 2016 is considerably improved compared to the first six months of 2015 (minus EUR 3.9 million). 2G expects a positive annual result at the upper end of the earnings forecast due to the final invoices of 2G CHP plants taking place by the end of the year, and the strong business trend in the current second half-year. As a result of the existing large order book, production capacity in 2-shift operation is fully occupied well into 2017. Sales revenue and total operating revenue rise as expected in the first half-year As expected, 2G increased its consolidated sales revenue in the first half- year of 2016 by 8.1% from EUR 59.0 million in the first half of the previous year to EUR 63.8 million. Total operating revenue increased significantly more strongly by 36.7% from EUR 62.5 million to EUR 85.5 million. 2G began 2016 with a tailwind, as an order book of EUR 85.5 million, of which 60% had not yet been started, was carried forward into the current year as a surplus from 2015. The growth surge in total operating revenue is based on inventory increases amounting to EUR 21.2 million (previous year: EUR 3.0 million) in ongoing CHP projects. A considerable proportion of the inventory increases will be finally invoiced in the second half of 2016, and will thus become effective in terms of sales and earnings in accordance with HGB (German Commercial Code) accounting. Consequently, the result as of June 30, 2016 does not show the real earnings strength. Against the background of the large inventory buildup in the period under review, the cost of materials ratio (relative to total operating revenue) increased slightly to 74.0% (previous year: 71.2%). On the other hand, the personnel expense ratio fell considerably from 22.8% to 17.4% due to higher production output performance. Overall, the distribution of the consolidated revenues of EUR 63.8 million in the first half of the year is 47.0% (EUR 19.8 million) attributable to CHP plant sales, 43.0% or EUR 27.6 million to Service and spare parts and 10.0% (EUR 6.0 million) accounted for by the After Sales area. The export share was 20% (previous year: 25%). It should be noted here that the considerably increased service revenue is generated so far largely in Germany. Order book characterized by high demand for biogas operated CHP plants at home and abroad The demand trend in Germany and other countries remained stable during the first half of the year. The order book position grew from EUR 85.5 million at the start of the year to EUR 106.4 million as of June 30, 2016, which is 39.6% above the previous year's value of EUR 76.2 million. The export share of the CHP order book is 41.4%, buoyed especially by very successful business in Great Britain, where the order book almost doubled from EUR 9.4 million in the previous year to EUR 18.2 million. Balance sheet ratios remain stable The balance sheet structure is still characterized by high stability and solvency. Compared to the balance sheet date of December 31, 2015, total assets rose by 11.5 % to EUR 107.4 million. Significant changes occurred in current assets due to a EUR 19.2 million increase in work-in-progress to EUR 45.5 million. Accounts receivable and other assets decreased by EUR 3.0 million to EUR 25.6 million, while liquidity (cash on hand, cash in banks) rose by EUR 4.7 million to EUR 14.8 million. Strong business performance in the second half year Taking into account the continuous improvement processes in operating procedures and the paradigm change to a sales and service partner concept, the Management Board is confident that the 2G Group's true value has never been higher than in the current year 2016. This value will consolidate further in the next few quarters through the continually growing internationalization of the business, pushing forward the digitalization of 2G power plants and services, and strengthening profitability. Against the background of decarbonization and decentralization as major drivers of climate protection, the CHP market will be a dynamic growth market for the foreseeable future - especially internationally. In the light of the trend in the second half of the year and thus for the full year 2016, the Management Board confirms the expectation that the respective upper region of the revenue and earnings forecasts, namely EUR 150 million to EUR 170 million and an EBIT margin of three to five percent respectively, will be achieved. Download half-year report Further details are obtainable from the half year report, which is available from today at www.2-g.com (Investor Relations - Financial Publications). 2G company portrait 2G Energy AG ranks among the world's leading manufacturers of cogeneration (CHP) systems for decentralized energy production and supply by means of combined heat and power. The company's product portfolio includes systems with electric capacity between 20 kW and 4,000 kW for operation with natural gas, biogas, biomethane and other lean gases. 2G has successfully installed several thousand CHP systems in 40 countries to date. Especially in the 50 kW to 550 kW performance range, 2G commands proprietary technological combustion engine concepts characterized by low specific fuel consumptions, high operational availability and optimized service intervals. Besides the main production site at the Group headquarters 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 agricultural and industrial operations, local authorities, and the residential sector through to municipal utilities and large-scale utilities. The high level of customer satisfaction is founded on a dense service network as well as 2G power stations' high technical quality and performance. These power stations achieve an overall degree of efficiency from 85 percent and to well above 90 percent thanks to the combined heat and power performance. Along with the construction of combined heat and power stations, the company, located in Westphalia in the northwest of Germany, offers integrated solutions spanning the planning stage and installation through to service and maintenance work. In the context of the energy policy revolution, and as part of modern energy supply concepts, CHP systems are gaining considerably in importance in intelligent energy grid systems - so- called virtual power plants - due to their decentralized and scalable operation, and predictable availability. 2G is consistently expanding its technology leadership through continuous research and development work, both in gas engine technology for natural gas, biogas and synthetic gas applications (e.g. hydrogen), as well as in specific software development. The "virtual power plant" operating type, for example, has been created with a software solution. Overall, the 2G power plant is thereby operated on a basis that is "heating-managed and electricity-oriented" in order to significantly simplify integration within a grid group. In the energy policy revolution's future electricity market design, such digitalization-enabled flexibility forms an indispensable system-relevant element in combination with solar, wind, biogas and natural gas producers, and creates a high barrier to market entry for competitors. The shares of 2G Energy (ISIN DE000A0HL8N9) have been listed in the Entry Standard of Deutsche Börse AG since July 31, 2007. The share capital amounts to EUR 4,430,000, and is divided into 4,430,000 shares. The company's founders held 55.3 % of the shares as of December 31, 2015, with the free float amounting to 44.7 %. 2016 calendar dates 21-22 Nov. 2016 Germany Equity Capital Forum 2016 Nov. 30, 2016 Q3 key figures and business trends IR contact 2G Energy AG Benzstr. 3, 48619 Heek Tel.: +49 (0) 2568 93 47-2795 Fax: +49 (0) 2568 93 47-15 Email: [email protected] Internet: www.2-g.de --------------------------------------------------------------------------- 27.09.2016 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. Archive at 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, Tradegate Exchange; Open Market (Entry Standard) in Frankfurt End of News DGAP News Service --------------------------------------------------------------------------- 505721 27.09.2016