GEA Earnings: Weak Order Intake in Late 2023 Foretells Softer Earnings Growth in 2024

GEA’s fourth-quarter result provided us with little in the way of surprise, with the wide-moat capital equipment supplier delivering full-year EBITDA of EUR 774 million, up about 9% year on year and aligning with our expectations. Solid organic sales growth of about 4% and 60 basis points of EBITDA margin progression, to 14.4%, supported earnings growth in 2023. Nonetheless, new orders remained weak in the final quarter of 2023—with liquid & powder and food & healthcare technologies segments particularly soft—capping off a year of subdued demand with full-year order intake growing just 0.8% organically. While we expect consequent softening in earnings growth in 2024, GEA shares continue to screen as appealing and our long-term expectations for solid earnings growth remain unchanged.