GEA Group Aktiengesellschaft ETR: G1A reported a stronger first quarter for fiscal 2026, with management saying order intake, sales and profitability improved under the company’s new organizational structure that took effect Jan. 1.
CEO Stefan Klebert said the company booked EUR 1.5 billion in order intake during the quarter, representing 6.4% organic growth year over year. He emphasized that the company’s exceptionally strong EUR 1.8 billion order intake in the fourth quarter of 2025, which included nine large orders, should not be viewed as a new quarterly baseline.
“The first quarter of 2026 reflects now a more normalized level of large orders,” Klebert said, adding that the increase in orders came from a broad base and was driven by orders below EUR 5 million. GEA booked three large orders above EUR 15 million in the quarter, totaling EUR 73 million, compared with three large orders totaling EUR 83 million in the prior-year period.
Sales rose 1.2% to EUR 1.3 billion, while organic sales growth reached 5.3%, within GEA’s full-year guidance range of 5% to 7%. EBITDA before restructuring expenses increased 3.9% year over year to EUR 206 million, and the corresponding margin improved to 16.2%, which Klebert called a new first-quarter record. Return on capital employed rose to 35.7%, within the company’s full-year guidance range of 34% to 38%.
New structure begins contributing savings
GEA is now reporting under four divisions: Pure Flow Processing, Nutrition Plant Engineering, Pharma & Food Applications and Farm Technologies. Klebert said the new setup is intended to reduce complexity and costs, and that the company has already seen initial benefits in the first quarter. GEA expects savings of EUR 10 million to EUR 15 million in 2026, with an additional EUR 10 million expected in 2027.
CFO Alexander Kocherscheidt said all divisions except Nutrition Plant Engineering contributed to positive order intake development. From a customer industry perspective, demand remained strong in dairy processing and dairy farming, while pharma, distribution and storage, and marine also showed good demand.
Reported order intake was affected by a negative foreign exchange translation impact of EUR 49 million, or 3.4%, Kocherscheidt said. Organic sales growth was supported by both new machine and service sales. New machine sales grew organically by 5.8%, while service sales grew 4.6%, marking the 22nd consecutive quarter of growth for the service business. The service sales share declined slightly to 41.2% because new machine sales grew faster.
Divisional results show strength in Farm Technologies
Pure Flow Processing, which includes the former Separation & Flow Technologies division plus the compressor business from the former Heating & Refrigeration Technologies division, reported organic order intake growth of 13%. Kocherscheidt said demand was strongest in dairy processing, beverage, food and marine. Organic sales rose 6.3%, and EBITDA before restructuring expenses increased to EUR 126 million. The division’s EBITDA margin improved to 26.5%.
Nutrition Plant Engineering, consisting of the former Liquid & Powder Technologies division plus the solutions business from the former Heating & Refrigeration Technologies division, had a slower start after a record fourth quarter. Organic order intake declined 2.1%, while organic sales fell 4.8%. Service sales continued to grow, rising 5.2% organically, but new machine sales declined 9.3% as late-booked fourth-quarter orders had not yet converted into sales.
EBITDA before restructuring expenses in Nutrition Plant Engineering fell to EUR 32 million from EUR 40 million a year earlier, and the margin declined to 8%. Kocherscheidt said management expects “a strong profitability acceleration” in coming quarters and remains comfortable with the division’s full-year EBITDA margin guidance of 11% to 13%.
Pharma & Food Applications delivered its fifth consecutive quarter of improvement across major key performance indicators. Organic order intake rose 5.9%, supported by pharma and food processing and packaging. Organic sales grew 3.9%, driven by new machine sales. EBITDA before restructuring expenses increased 6.4% to EUR 33 million, and the EBITDA margin reached 13.4%, which Kocherscheidt said was an all-time high for a first quarter.
Farm Technologies posted what management described as an outstanding quarter. Organic order intake increased 13.7%, driven mainly by demand for automated milking systems. Organic sales rose 26%, including a 57.4% organic increase in new machine sales, against a weak prior-year comparison. EBITDA before restructuring expenses climbed 57.8% to EUR 34 million, and the margin increased to 16.7%, the division’s strongest first quarter on record.
Middle East impact seen as manageable
Klebert said the ongoing conflict in the Middle East has not created a material direct impact on GEA’s business. The company has no production sites or important suppliers in the region and continues to negotiate projects with customers there.
He also said indirect effects remain manageable. GEA is not energy-intensive, with an energy bill below EUR 30 million last year, and most of its energy consumption is covered by fixed-price agreements through the end of 2026. More than 80% of procurement is sourced locally, limiting exposure to global supply chains and sea freight.
Klebert acknowledged potential price increases in energy-intensive raw materials such as steel, but said GEA is negotiating with suppliers and using targeted measures, including price increases where needed.
Cash flow and balance sheet
Net liquidity declined by EUR 24 million year over year to EUR 162 million, reflecting a higher net working capital outflow in the quarter. Kocherscheidt said net working capital showed the typical seasonal increase from year-end, driven mainly by lower trade payables, along with higher inventories and contract assets tied to the order backlog.
Free cash flow was negative EUR 190 million in the quarter. Operating cash flow was negative EUR 125 million, driven by the net working capital buildup and a EUR 90 million outflow that included bonus payments for fiscal 2025. Capital expenditures were EUR 33 million, below the company’s full-year guidance of around EUR 240 million, with spending expected to ramp up in coming quarters.
Kocherscheidt said GEA expects roughly the same level of free cash flow for full-year 2026 as in 2025.
Guidance confirmed, order pipeline described as promising
GEA confirmed its full-year 2026 guidance for organic sales growth of 5% to 7%, an EBITDA margin before restructuring expenses of 16.6% to 17.2%, and return on capital employed of 34% to 38%.
During the question-and-answer session, Klebert said the order pipeline is “very promising” and that the company expects good order intake in the first half of the year, supported not only by large orders but also by medium-sized and base orders. He said he would be “completely surprised” if GEA did not see strong order intake improvement for the full year.
Asked about Farm Technologies, Klebert said he had no evidence of customers accelerating orders because of concerns about future conditions. He pointed to product range expansion, digital offerings and automated milking systems as drivers of demand. On margins, he said the company expects Farm Technologies to remain a good business, while noting that some volatility can occur depending on milk prices and feed costs.
Klebert also highlighted opportunities from demand for energy-efficient solutions, saying higher energy costs give customers stronger incentives to modernize assets and processes. He cited GEA’s Add Better label, which covers products designed to be more resource-efficient than predecessors, and said the portfolio had reached 50 products by the end of 2025.
GEA also introduced a new customer offering, GEA Security Partner, which Klebert described as a modular portfolio of industrial security services intended to help customers secure operational technology environments and meet regulatory requirements.
About GEA Group Aktiengesellschaft ETR: G1A
GEA Group Aktiengesellschaft engages in the development and production of systems and components to the food, beverage, and pharmaceutical industries. It operates through Separation & Flow Technologies, Liquid & Power Technologies, Food & Health Technologies, Farm Technologies, and Heating & Refrigeration Technologies segments. The Separation & Flow Technologies segment manufacture process-related components and machinery including notably separators, decanters, homogenizers, valves, and pumps.
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