GEA Group has forecast that China will become its leading market within the next few years as it highlighted growing demand from the emerging economic superpower as the driver behind a 12.7% jump in orders, according to FoodProductionDaily.com.
The German-based processing machinery giant pin-pointed burgeoning demand from Asia, and China in particular, as the major factor in the significant increase in year-on year orders from €1.036 billion (about NZ$1.84 billion) in 2009 to €1.167 billion for the three month period ending 30 June. This figure is the highest level since the outbreak of the financial and economic crisis, the report says.
At €1.065 billion, revenue in Q2 was up 13.5% on Q1 2010 but 3.5% below the prior-year quarter. The firm said that higher-than-expected restructuring costs had hit Q2 profits which fell 11% to €28.8 million from €32.4 million in 2009.
A GEA spokesman told FoodProductionDaily.com that it expected China, currently its third most important market behind Germany and the United States, to become the group’s most lucrative sector by the end of 2013.
“Demand for our beverage and food process technology in Asia, and in particular in China, is currently extremely encouraging,” the report quotes Jürg Oleas, CEO of GEA Group saying. “At the beginning of July, we recorded another major order worth over €30 million in the food segment from this region.”
He said that growth of orders was developing as the company had previously foreseen and said the company was confident it would meet its 2010 revenue target of €4.4 billion if the global economy does not slide back into a recession.
GEA said that €60.3 million restructuring costs – mainly connected with its heat exchange division – had been higher than expected in the first half of 2010. Some 595 jobs had been cut since the end of Q2 2009 – with 474 of these shed since the start of the year. The efficiency drive would see the closure of some facilities although not a reduction in the number of production lines – as these would be transferred to other plants, said the spokesman. A further €60 million worth of restructuring costs would be carried out in the second half of 2010.
