2G Energy AG: Order intake recovers in Q3 in line with expectations and exceeds the previous year by 12%

2G Energy AG: Order intake recovers in Q3 in line with expectations and exceeds the previous year by 12%

• German biogas business shows significant growth (19.5 million euros, previous year: 12.4 million euros)
• Rising electricity prices for electricity futures continue to generate lively interest
• Order backlog remains at a high level (approx. 195 million euros)
• Major project in Israel not at risk in spite of tense security situation

Heek, October 26, 2023 – 2G Energy AG (ISIN DE000A0HL8N9), one of the internationally leading manufacturers of combined heat and power (CHP) systems and a producer of heat pumps, succeeded in increasing its order intake by 12% year on year in the past quarter in line with expectations. Orders received for heat pumps were not yet posted since the takeover of the Dutch NRGTEQ B.V. (see Corporate News on 08/28/2023) – also as expected. 

German biogas business shows significant growth (19.5 million euros, previous year: 12.4 million euros)

Special mention must be made of business with CHP systems in the biogas sector which is enjoying a structural boost, particularly in Germany, with permanently higher energy prices. Thus, 2G was able to expand its order intake in this market by a total of 57%. 

By contrast, 2G continues to be faced with a degree of purchasing reluctance in the natural gas sector, mainly caused by uncertainty with respect to the macroeconomic outlook. 

Rising electricity prices for electricity futures continue to generate lively interest

Interest in CHP solutions based on natural gas and biogas remains very strong around the world which continues to be reflected in a very high number of current quotations and correspondingly intensive talks with customers. Against the background of a downturn in the economic outlook, many industrial customers see the need to grapple with a safe, affordable and environmentally friendly energy supply. 

After reaching an all-time high as a result of the invasion of Ukraine, electricity prices are now easing again. However, electricity – especially in Europe – remains a scarce commodity or one that is becoming scarcer. This is evidenced by the price of one MWh (baseload) for delivery in Germany in January which is currently estimated at above 130 euros, almost 50% higher than the average price for baseload electricity in the third quarter just ended. The future contracts traded for Q1 2024 exceed the actual price level in Q1 2023 by around 15% even though the start of 2023 was heavily affected by fears of a potential gas shortage. Market participants therefore expect a substantial price increase for electricity, while at the same time the supply situation for natural gas is considered largely secure and only moderate price increases are expected.

The order intake in the last quarter breaks down as follows:

Order backlog remains at a high level (approx. 195 million euros)

Although fully consolidated sales figures are not yet available, it is already clear that the order backlog as of the end of the third quarter will rise again slightly. 2G is thus still expecting to operate at full capacity until well into the new year. The Management Board confirms its forecast already published for the current year (sales of 310 to 350 million euros with an EBIT margin of 6.5-8.5%) as well as for the coming year (sales of up to 390 million euros with an EBIT margin of 8.5-10.0%).

Major project in Israel not at risk in spite of tense security situation

The major order from Israel recorded in July totaling 6.1 million euros is being pursued as planned. A cascade of containerized natural gas CHP units is to be commissioned in the interior of the country during the first half of 2024. The agreed advance payments were made on time, the necessary permits have been applied for and in some cases have already been obtained. The shipping schedule is unchanged and due for the first quarter of 2024.

2G company portrait
The 2G Energy AG Group is an internationally leading manufacturer and system provider of decentralized energy supply systems. The company develops, produces and installs comprehensive solutions in the growing market for highly efficient CHPs and large heat pumps. Digital grid integration and plant control for both types of energy generators, as well as service and maintenance, are further decisive performance criteria.

The product portfolio includes CHP plants in the output range from 20 kW to 4,500 kW for operation with hydrogen, natural gas, biogas and other lean gases, as well as large heat pumps in the range from 100 kW to 1,000 kW. CHP plants operate with efficiencies of 90 percent and more, while large heat pumps achieve efficiencies of 300 to 500 percent, depending on the general conditions. With its products and services, 2G is at the interface to a decentralized, secure and largely decarbonized energy supply. More than 8,000 2G systems have already been installed worldwide in various applications, supplying electrical and thermal energy to a wide range of customers from the housing industry, agriculture, commercial and industrial companies, energy suppliers, municipal utilities and local government authorities.

2G is positioned worldwide as a system provider for decentralized energy solutions with its combination of CHP plants and large heat pumps. The company benefits from far-reaching synergies of both plant categories, ranging from project development, procurement, and production to the largely identical customer base and regulatory framework as well as sales channels and digital control and service.

2G is consistently expanding its technological leadership through continuous research and development work, both in power plant and pump technologies as well as in specific software development for service and maintenance activities. The digital grid integration consistently implemented by 2G is an indispensable, system-relevant element in the future electricity market design and represents a high market entry hurdle for competitors. The sector coupling required for the success of the energy transition is reflected in 2G's portfolio.

2G employs more than 900 employees at its headquarters in Heek, Germany, in North America, as well as at five other European locations. The company is active in more than 50 countries and generated net sales of EUR 312.6 million in the 2022 financial year. 2G was founded in 1995 and has been listed on the capital market since 2007. The shares of 2G Energy (ISIN DE000A0HL8N9) are listed in the “Scale” segment of the Frankfurt Stock Exchange.

2023 calendar dates
November 27  Q3 key figures and business trends
November 27-29  German Equity Forum, Frankfurt

IR contact
2G Energy AG
Benzstrasse 3, 48619 Heek
Phone: +49 (0) 2568 93 47-2795
Fax: +49 (0) 2568 93 47-15
Email: ir@2-g.de
Internet: www.2-g.de