Quarterly Report • May 12, 2016
Quarterly Report
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Q1 2016
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| € million | ||||
|---|---|---|---|---|
| 2016 | 2015 | ∆ in % | 2015 | |
| Output volume | 1,348 | 1,413 | -5 | 6,201 |
| Orders received | 1,404 | 1,632 | -14 | 6,582 |
| Order backlog | 4,741 | 4,622 | 3 | 4,727 |
| EBITA adjusted 1 | 7 | 8 | -13 | 165 |
| Adjusted net profit from continuing operations 1 | 1 | 1 | 0 | 93 |
| Adjusted earnings per share from continuing operations 1 (in €) |
0.01 | 0.02 | -50 | 2.10 |
| Net profit 2 | -76 | -17 | -489 | |
| Cash flow from operating activities | -118 | -133 | 109 | |
| Investments | 14 | 24 | -42 | 72 |
| thereof in P, P & E | 13 | 23 | -43 | 68 |
| thereof in financial assets | 1 | 1 | 0 | 4 |
| Number of employees | 53,836 | 56,235 | -4 | 54,831 |
Q1 Full year
* The key figures of the former Power and Concessions business segments, the former construction activities, the sold Water Technologies division as well as Offshore Systems are no longer presented in the business segments, but under Discontinued operations. All of the figures presented in this report relate, unless otherwise stated, to the Group's continuing operations, the figures for the prior-year period have been adjusted accordingly.
1 Adjustments see chapter Reconciliation to adjusted earnings. 2 Includes continuing and discontinued operations.
2015
2015
2015
The Supervisory Board of Bilfinger SE appointed Thomas Blades as new Chairman of the Executive Board. The concerned parties are coordinating when exactly Thomas Blades will take up his duties. Bilfinger SE expects that he will assume the position of Chairman of the Executive Board in the third quarter of 2016 at the latest. He succeeds Per H. Utnegaard, who stepped down at the end of April 2016. In the interim period, Bilfinger CFO Axel Salzmann assumed the role of Chairman of the Executive Board in addition to his other tasks.
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| CONSOLIDATED INCOME STATEMENT (ABRIDGED VERSION) € million |
Q1 | Full year | |
|---|---|---|---|
| 2016 | 2015 | 2015 | |
| Output volume | 1,348 | 1,413 | 6,201 |
| EBITA | -21 | 7 | 140 |
| EBITA adjusted | 7 | 8 | 165 |
| EBITA margin adjusted (in %) | 0.5 | 0.6 | 2.7 |
| Amortization of intangible assets from acquisitions (IFRS 3) | -5 | -8 | -27 |
| EBIT | -26 | -1 | 113 |
| Interest result | -6 | -6 | -26 |
| Earnings before taxes | -32 | -7 | 87 |
| Income tax income / expense | -5 | 3 | -91 |
| Earnings after taxes from continuing operations | -37 | -4 | -4 |
| Earnings after taxes from discontinued operations | -41 | -13 | -500 |
| Earnings after taxes | -78 | -17 | -504 |
| thereof attributable to minority interest | -2 | 0 | 15 |
| Net profit | -76 | -17 | -489 |
| RECONCILIATION TO ADJUSTED EARNINGS € million |
Q1 | Full year | |
|---|---|---|---|
| 2016 | 2015 | 2015 | |
| EBITA | -21 | 7 | 140 |
| Special items in EBITA | 28 | 1 | 25 |
| EBITA adjusted | 7 | 8 | 165 |
| Interest result | -6 | -6 | -26 |
| Adjusted income tax expense | 0 | -1 | -43 |
| Minority interest | 0 | 0 | -3 |
| Adjusted net profit | 1 | 1 | 93 |
| Adjusted earnings per share from continuing operations (in €) | 0.01 | 0.02 | 2.10 |
Includes current result from the Power segment of -€14 million (previous year: -€17 million), the impairment loss in connection with the reversal of the acquisition of Mauell GmbH of -€7 million, the result from the sale of the Water Technologies division of -€16 million, the current result of Water Technologies of -€3 million (previous year: €0 million) as well as the result of the former construction activities and Offshore Systems of -€1 million (previous year: -€6 million); included in the prior-year figure is also the result from the sale of the Construction division after a risk provision in the amount of €12 million.
Net profit: At -€76 million well below the prior-year figure.
| CONSOLIDATED BALANCE SHEET (ABRIDGED VERSION) | ||
|---|---|---|
| € million | March 31, 2016 | Dec. 31, 2015 |
| pro forma | ||
| Assets | ||
| Non-current assets | 2,096 | 2,167 |
| Intangible assets | 1,475 | 1,535 |
| Property, plant and equipment | 381 | 400 |
| Other non-current assets | 240 | 232 |
| Current assets | 2,679 | 3,041 |
| Receivables and other current assets | 1,476 | 1,557 |
| Cash and cash equivalents | 392 | 421 |
| Assets classified as held for sale | 811 | 1,063 |
| Total | 4,775 | 5,208 |
| Equity and liabilities | ||
| Equity | 1,284 | 1,440 |
| Non-current liabilities | 1,068 | 1,030 |
| Provisions for pensions and similar obligations | 429 | 391 |
| Non-current financial debt, recourse | 511 | 511 |
| Non-current financial debt, non-recourse | 12 | 13 |
| Other non-current liabilities | 116 | 115 |
| Current liabilities | 2,423 | 2,738 |
| Current financial debt, recourse | 4 | 2 |
| Current financial debt, non-recourse | 0 | 1 |
| Other current liabilities | 1,606 | 1,814 |
| Liabilities classified as held for sale | 813 | 921 |
Total 4,775 5,208
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For the analysis of net assets, in order to gain better comparability with the figures as of March 31, 2016, the assets and liabilities of discontinued operations of the former Power business segment together with the figures from the former construction activities, the sold Water Technologies division and Offshore Systems are shown separately in an item on the assets side and an item on the liabilities side of the pro-forma balance sheet as of December 31, 2015.
| CONSOLIDATED STATEMENT OF CASH FLOWS (ABRIDGED VERSION) € million |
Q1 | Full year | |
|---|---|---|---|
| 2016 | 2015 | 2015 | |
| Cash earnings from continuing operations | 2 | 8 | 166 |
| Change in working capital | -119 | -138 | -14 |
| Gains on disposals of non-current assets | -1 | -3 | -43 |
| Cash flow from operating activities of continuing operations | -118 | -133 | 109 |
| Investments in property, plant and equipment / intangible assets | -13 | -23 | -69 |
| Proceeds from the disposal of property, plant and equipment | 2 | 8 | 26 |
| Net cash outflow for property, plant and equipment / intangible assets | -11 | -15 | -43 |
| Proceeds from the disposal of financial assets | 190 | 76 | 212 |
| Free cash flow from continuing operations | 61 | -72 | 278 |
| Investments in financial assets | -1 | -1 | -4 |
| Cash flow from financing activities of continuing operations | 1 | -2 | -96 |
| Dividends | 0 | 0 | -93 |
| Borrowing / repayment of financial debt | 1 | -2 | -3 |
| Change in cash and cash equivalents of continuing operations |
61 | -75 | 178 |
| Change in cash and cash equivalents of discontinued operations |
-101 | -25 | -115 |
| Change in value of cash and cash equivalents due to changes in foreign exchange rates | -1 | 8 | 2 |
| Change in cash and cash equivalents | -41 | -92 | 65 |
| Cash and cash equivalents at January 1 | 429 | 403 | 403 |
| Change in cash and cash equivalents of assets | |||
| classified as held for sale | 4 | -3 | -39 |
| Cash and cash equivalents at March 31 / December 31 | 392 | 308 | 429 |
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Consolidated statement of cash flows (abridged version)
Definition for the qualified comparative forecast: at prior-year level: + / - 0 % slight: 1- 5 % significant : > 5 %
In 2016 we expect, from today's perspective, the following significant one-time expenses: restructuring expenses in a high doubledigit million euro range, especially for the program to reduce administrative expenses, including substantial investments in IT systems for the standardization of the system landscape. On top of this, there will be expenses in connection with the further development of our compliance system and the conclusion of older cases in the amount of approximately €50 million. Further, the reported net profit will likely be burdened by the non-capitalization of deferred tax assets on the negative result of the holding.
| OVERVIEW OF OUTPUT VOLUME AND ORDER SITUATION |
Output volume | Orders received | Order backlog | ||||
|---|---|---|---|---|---|---|---|
| € million | Q1/2016 | ∆ in % | Q1/2016 | ∆ in % | Q1/2016 | ∆ in % | Q1-4 / 2015 |
| Industrial | 788 | -6 | 782 | -7 | 2,067 | -17 | 3,650 |
| Building and Facility | 576 | -3 | 635 | -26 | 2,681 | 23 | 2,627 |
| Consolidation / other | -16 | -13 | -7 | -76 | |||
| Continuing operations | 1,348 | -5 | 1,404 | -14 | 4,741 | 3 | 6,201 |
| ADJUSTED EBITA BY BUSINESS SEGMENT € million |
Q1 | Full year | ||
|---|---|---|---|---|
| 2016 | 2015 | ∆ in % | 2015 | |
| Industrial | 14 | 9 | 56 | 128 |
| Building and Facility | 13 | 16 | -19 | 126 |
| Consolidation / other | -20 | -17 | -89 | |
| Continuing operations | 7 | 8 | -13 | 165 |
| 2016 | 2015 | 2% Asia | ||
|---|---|---|---|---|
| 23% Germany 18 % America |
||||
| 788 | 835 | -6 | 3,650 | |
| 782 | 840 | -7 | 3,302 | |
| -17 | 2,101 | |||
| 9 | 16 | -44 | 47 | |
| 14 | 9 | 56 | 128 | 57% Rest of Europe |
| 1.8 | 1.1 | 3.5 | ||
| 2,067 2,500 | 2015 ∆ in % |
Divisions: We have reduced the number of divisions in the Industrial segment from six to four. With the reorganization of units, our business operations are more clearly focused on individual customer industries and, at the same time, we are simplifying internal structures and enhancing efficiency.
Output volume: Decrease of 6 percent in the wake of the low oil price.
| KEY FIGURES € million |
Q1 | Full year | TARGET OUTPUT VOLUME BY REGION 2016 | ||
|---|---|---|---|---|---|
| 2016 | 2015 ∆ in % | 2015 | 6% America | ||
| Output volume | 576 | 595 | -3 | 2,627 | 34 % Rest of Europe |
| Orders received | 635 | 857 | -26 | 3,370 | |
| Order backlog | 2,681 2,182 | 23 | 2,642 | ||
| Capital expenditure on P, P & E | 2 | 5 | -60 | 16 | |
| EBITA / EBITA adjusted | 13 | 16 | -19 | 126 | |
| EBITA margin adjusted (in %) | 2.3 | 2.7 | 4.8 |
Discontinued operations include the former Power and Concessions business segments, former construction activities and the sold Water Technologies division as well as Offshore Systems.
| KEY FIGURES € million |
Q1 | Full year | ||
|---|---|---|---|---|
| 2016 | 2015 | ∆ in % | 2015 | |
| Output volume | 112 | 167 | -33 | 572 |
| Capital expenditure on P, P & E | 3 | 13 | -77 | 73 |
| EBITA | -18 | 3 | 4 |
Water Technologies: At the end of the first quarter of 2016, we finalized the sale of the Water Technologies division to Chinese Chengdu Techcent Environment Group, thus further implementing the focusing strategy. As a result of the sale, Bilfinger received net proceeds in the amount of €190 million as additional liquidity. In 2015, the Water Technologies division generated an output volume of nearly €300 million with just below 1,600 employees.
| KEY FIGURES € million |
Q1 | Full year | ||
|---|---|---|---|---|
| 2016 | 2015 | ∆ in % | 2015 | |
| Output volume | 247 | 287 | -14 | 1,284 |
| Orders received | 230 | 327 | -30 | 986 |
| Order backlog | 742 | 1,116 | -34 | 762 |
| Capital expenditure on P, P & E | 1 | 2 | -50 | 9 |
| EBITA adjusted | -3 | -18 | -59 |
| CONSOLIDATED INCOME STATEMENT € million |
January 1 - March 31 | |
|---|---|---|
| 2016 | 2015 | |
| Output volume (for information only) | 1,348 | 1,413 |
| Revenue | 1,349 | 1,413 |
| Cost of sales | -1,218 | -1,268 |
| Gross profit | 131 | 145 |
| Selling and administrative expenses | -145 | -149 |
| Other operating income and expense | -14 | -2 |
| Income from investments accounted for using the equity method | 2 | 5 |
| Earnings before interest and taxes (EBIT) | -26 | -1 |
| Net interest result | -6 | -6 |
| Earnings before taxes | -32 | -7 |
| Income tax income / expense | -5 | 3 |
| Earnings after taxes from continuing operations | -37 | -4 |
| Earnings after taxes from discontinued operations | -41 | -13 |
| Earnings after taxes | -78 | -17 |
| thereof minority interest | -2 | 0 |
| Net profit | -76 | -17 |
| Average number of shares (in thousands) | 44,200 | 44,189 |
| Earnings per share (in €) 1 | -1.72 | -0.38 |
| thereof from continuing operations | -0.80 | -0.09 |
| thereof from discontinued operations | -0.92 | -0.29 |
1 Basic earnings per share are equal to diluted earnings per share.
| CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | January 1 - March 31 | |
|---|---|---|
| € million | 2016 | 2015 |
| Earnings after taxes | -78 | -17 |
| Items that will not be reclassified to the income statement | ||
| Gains / losses from remeasurement of net defined benefit liability (asset) | ||
| Unrealized gains / losses | -52 | -54 |
| Income taxes on unrealized gains / losses | 16 | 15 |
| -36 | -39 | |
| Items that may subsequently be reclassified to the income statement | ||
| Gains / losses on fair-value measurement of securities | ||
| Unrealized gains / losses | 4 | 0 |
| Income taxes on unrealized gains / losses | 0 | 0 |
| 4 | 0 | |
| Gains / losses on hedging instruments | ||
| Unrealized gains / losses | -1 | -10 |
| Reclassifications to the income statement | 1 | 4 |
| Income taxes on unrealized gains / losses | 0 | 1 |
| 0 | -5 | |
| Currency translation differences | ||
| Unrealized gains / losses | -41 | 102 |
| Reclassifications to the income statement | -4 | -1 |
| -45 | 101 | |
| Gains / losses on investments accounted for using the equity method | ||
| Gains / losses on hedging instruments | ||
| Unrealized gains / losses | 0 | 1 |
| Reclassifications to the income statement | 0 | 0 |
| 0 | 1 | |
| Currency translation differences | ||
| Unrealized gains / losses | 0 | 2 |
| 0 | 3 | |
| -41 | 99 | |
| Other comprehensive income after taxes | -77 | 60 |
| Total comprehensive income after taxes | -155 | 43 |
| attributable to shareholders of Bilfinger SE | -153 | 45 |
| attributable to minority interest | -2 | -2 |
| IIIUII | |||
|---|---|---|---|
| € million | March 31, 2016 | Dec. 31, 2015 March 31, 2015 | ||
|---|---|---|---|---|
| Assets | Non-current assets | |||
| Intangible assets | 1,475 | 1,650 | 2,070 | |
| Property, plant and equipment | 381 | 447 | 657 | |
| Investments accounted for using the equity method | 19 | 18 | 75 | |
| Other financial assets | 58 | 62 | 66 | |
| Deferred taxes | 163 | 163 | 243 | |
| 2,096 | 2,340 | 3,111 | ||
| Current assets | ||||
| Inventories | 60 | 95 | 194 | |
| Receivables and other financial assets | 1,302 | 1,488 | 1,888 | |
| Current tax assets | 37 | 37 | 66 | |
| Other assets | 77 | 69 | 117 | |
| Cash and cash equivalents | 392 | 429 | 308 | |
| Assets classified as held for sale | 811 | 750 | 111 | |
| 2,679 | 2,868 | 2,684 | ||
| 4,775 | 5,208 | 5,795 | ||
| Equity and liabilities | Equity | |||
| Equity attributable to shareholders of Bilfinger SE | 1,322 | 1,476 | 1,983 | |
| Minority interest | -38 | -36 | -23 | |
| 1,284 | 1,440 | 1,960 | ||
| Non-current liabilities | ||||
| Provisions for pensions and similar obligations | 429 | 396 | 580 | |
| Other provisions | 47 | 50 | 55 | |
| Financial debt, recourse | 511 | 513 | 516 | |
| Financial debt, non-recourse | 12 | 13 | 13 | |
| Other liabilities | 16 | 17 | 25 | |
| Deferred taxes | 53 | 55 | 60 | |
| 1,068 | 1,044 | 1,249 | ||
| Current liabilities | ||||
| Current tax liabilities | 46 | 51 | 86 | |
| Other provisions | 357 | 400 | 529 | |
| Financial debt, recourse | 4 | 7 | 26 | |
| Financial debt, non-recourse | 0 | 1 | 26 | |
| Trade and other payables | 935 | 1,086 | 1,437 | |
| Other liabilities | 268 | 344 | 353 | |
| Liabilities classified as held for sale | 813 | 835 | 129 | |
| 2,423 | 2,724 | 2,586 |
4,775 5,208 5,795
| Equity attributable to the shareholders of Bilfinger SE | Minority interest |
Equity | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Other reserves | ||||||||||
| Share capital |
Capital reserve |
Retained and dis tributable earnings |
Fair-value measurement of securities reserve |
Hedging instru ments reserve |
Currency trans lation reserve |
Treasury shares |
Total | |||
| Balance at January 1, 2015 | 138 | 760 | 1,171 | 0 | -44 | 10 | -97 | 1,938 | -21 | 1,917 |
| Earnings after taxes | 0 | 0 | -17 | 0 | 0 | 0 | 0 | -17 | 0 | -17 |
| Other comprehensive income after taxes | 0 | 0 | -39 | 0 | -4 | 105 | 0 | 62 | -2 | 60 |
| Total comprehensive income after taxes | 0 | 0 | -56 | 0 | -4 | 105 | 0 | 45 | -2 | 43 |
| Dividends paid out | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Employee share program | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Changes in ownership interest without change in control |
0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other changes | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Balance at March 31, 2015 | 138 | 760 | 1,115 | 0 | -48 | 115 | -97 | 1,983 | -23 | 1,960 |
| Balance at January 1, 2016 | 138 | 760 | 600 | 0 | -3 | 78 | -97 | 1,476 | -36 | 1,440 |
| Earnings after taxes | 0 | 0 | -76 | 0 | 0 | 0 | 0 | -76 | -2 | -78 |
| Other comprehensive income after taxes | 0 | 0 | -36 | 4 | 0 | -45 | 0 | -77 | 0 | -77 |
| Total comprehensive income after taxes | 0 | 0 | -112 | 4 | 0 | -45 | 0 | -153 | -2 | -155 |
| Dividends paid out | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Employee share program | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Changes in ownership interest without change in control |
0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other changes | 0 | 0 | -1 | 0 | 0 | 0 | 0 | -1 | 0 | -1 |
| Balance at March 31, 2016 | 138 | 760 | 487 | 4 | -3 | 33 | -97 | 1,322 | -38 | 1,284 |
| CONSOLIDATED STATEMENT OF CASH FLOWS € million |
January 1 - March 31 | ||
|---|---|---|---|
| 2016 | 2015 | ||
| Earnings after taxes from continuing operations | -37 | -4 | |
| Depreciation, amortization and impairments | 25 | 32 | |
| Decrease in non-current provisions and liabilities | -2 | -3 | |
| Deferred tax expense / benefit | 2 | -15 | |
| Adjustment for non-cash income from equity-method investments | 0 | -2 | |
| Other impairments | 14 | 0 | |
| Cash earnings from continuing operations | 2 | 8 | |
| Increase / decrease in inventories | -3 | 1 | |
| Decrease / increase in receivables | 32 | -29 | |
| Decrease in current provisions | -28 | -24 | |
| Decrease in liabilities | -120 | -86 | |
| Change in working capital | -119 | -138 | |
| Gains on disposals of non-current assets | -1 | -3 | |
| Cash flow from operating activities of continuing operations | -118 | -133 | |
| Proceeds from the disposal of property, plant and equipment | 2 | 8 | |
| Proceeds from the disposal of subsidiaries net of cash and cash equivalents disposed of | 190 | 75 | |
| Proceeds from the disposal of other financial assets | 0 | 1 | |
| Investments in property, plant and equipment and intangible assets | -13 | -23 | |
| Investments in other financial assets | -1 | -1 | |
| Cash flow from investing activities of continuing operations | 178 | 60 | |
| Borrowing | 1 | 0 | |
| Repayment of financial debt | 0 | -2 | |
| Cash flow from financing activities of continuing operations | 1 | -2 | |
| Change in cash and cash equivalents of continuing operations | 61 | -75 | |
| Cash flow from operating activities of discontinued operations | -95 | -11 | |
| Cash flow from investing activities of discontinued operations | -2 | -14 | |
| Cash flow from financing activities of discontinued operations | -4 | 0 | |
| Change in cash and cash equivalents of discontinued operations | -101 | -25 | |
| Change in value of cash and cash equivalents due to changes in foreign exchange rates | -1 | 8 | |
| Cash and cash equivalents at January 1 | 429 | 403 | |
| Cash and cash equivalents classified as assets held for sale at January 1 | 51 | 13 | |
| Cash and cash equivalents classified as assets held for sale at March 31 (-) | 47 | 16 | |
| Cash and cash equivalents at March 31 | 392 | 308 |
Segment reporting is prepared in accordance with IFRS 8. The reportable segments of the Bilfinger Group reflect the internal reporting structure. The definition of the segments is based on products and services.
The existing eight divisions are allocated to two business segments. Compared to March 31, 2015, the number of business segments and divisions declined as a result of the classification of the former Power business segment with its two divisions as discontinued operations as well as the sale of the Water Technologies division and the combining of the former Engineering, Automation and Control and Industrial Fabrication and Installation divisions to form the new Engineering Solutions division. The prior-year figures have been adjusted accordingly. Furthermore, the former Support Services division was formally broken up as of April 1, 2016 and its companies were allocated to the Industrial Maintenance, Engineering Solutions and Insulation, Scaffolding and Painting divisions.
Earnings before interest, taxes and amortization of intangible assets from acquisitions (EBITA) is the key performance indicator for the business units and the Group, and thus the metric for earnings in our segment reporting. EBIT is also reported. The reconciliation of EBIT to earnings before taxes from continuing operations is derived from the consolidated income statement.
| SEGMENT REPORTING Q1 € million |
Output volume |
External revenue |
Internal revenue |
EBITA | intangible assets from acquisitions |
Amortization of and goodwill impairment |
EBIT | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2016 | 2015 | 2016 | 2015 | 2016 | 2015 | 2016 | 2015 | 2016 | 2015 | 2016 | 2015 | |
| Industrial | 788 | 835 | 773 | 824 | 18 | 14 | 14 | 9 | -2 | -4 | 12 | 5 |
| Building and Facility | 576 | 595 | 566 | 583 | 5 | 5 | 13 | 16 | -3 | -4 | 10 | 12 |
| Consolidation / other | -16 | -17 | 10 | 6 | -23 | -19 | -48 | -18 | 0 | 0 | -48 | -18 |
| Continuing operations | 1,348 | 1,413 | 1,349 | 1,413 | 0 | 0 | -21 | 7 | -5 | -8 | -26 | -1 |
The interim consolidated financial statements as of March 31, 2016 have been prepared in accordance with the International Financial Reporting Standards (IFRSs) as they are to be applied in the EU, as were the consolidated financial statements for the year 2015, and comply with the requirements of IAS 34. They do not provide all of the information and disclosures included in complete consolidated financial statements and are therefore to be read in conjunction with the consolidated financial statements as of December 31, 2015. The accounting policies explained in the notes to the consolidated financial statements for the year 2015 have been applied unchanged.
As was the case in the prior-year period, no acquisitions were made during the interim reporting period.
In the reporting period, the former Water Technologies division was sold to the Chinese company Chengdu Techcent Environment Group. The former Construction division was sold to the Swiss construction and construction services company Implenia in the prior-year period. The overall effects of the sales were as follows:
Taking into consideration an impairment of assets, which will first be disposed of in the second quarter of 2016, a capital loss in the amount of €16 million resulted from the sale of the former Water Technologies division.
The capital gain / loss is recognized in earnings from discontinued operations.
Discontinued operations comprise
The former Water Technologies division was sold to the Chinese company Chengdu Techcent Environment Group on March 31, 2016. It is retrospectively reported as discontinued operations.
In accordance with the provisions of IFRS 5, the investments put up for sale have been recognized as discontinued operations as of the time of reclassification:
Since the dates of their reclassification, non-current assets classified as held for sale have no longer been subject to depreciation or amortization and subsequent measurement according to the equity method was ceased for the investments accounted for using the equity method.
The amounts in the consolidated income statement and the consolidated statement of cash flows for the prior-year period have been adjusted accordingly.
Earnings from discontinued operations are comprised as follows:
| € million | Jan. 1 - March 31 | |
|---|---|---|
| 2016 | 2015 | |
| Construction activities and Concessions | -1 | 5 |
| Power | -21 | -18 |
| Water Technologies | -19 | 0 |
| Earnings after taxes from discontinued operations | -41 | -13 |
Minority interests account for a proportionate loss of €2 million (previous year: €0 million) of earnings after taxes from discontinued operations.
All discontinued operations with the exception of the former Power business segment and the former Water Technologies division are reported together under Construction activities and Concessions.
| € million | Jan. 1 - March 31 | |||
|---|---|---|---|---|
| 2016 | 2015 | |||
| Output volume (for information only) | 59 | 105 | ||
| Revenue | 59 | 102 | ||
| Expenses / income | -60 | -193 | ||
| Gain on disposal | 0 | 80 | ||
| EBIT | -1 | -11 | ||
| Net interest result | 0 | 0 | ||
| Earnings before taxes | -1 | -11 | ||
| Income tax income / expense | 0 | 16 | ||
| Earnings after taxes | -1 | 5 |
| € million | Jan. 1 - March 31 | |||
|---|---|---|---|---|
| 2016 | 2015 | |||
| Output volume (for information only) | 247 | 287 | ||
| Revenue | 249 | 288 | ||
| Expenses / income | -260 | -307 | ||
| Impairment loss | -6 | 0 | ||
| EBIT | -17 | -19 | ||
| Net interest result | -2 | -2 | ||
| Earnings before taxes | -19 | -21 | ||
| Income tax income / expense | -2 | 3 | ||
| Earnings after taxes | -21 | -18 |
On April 14, 2016, a contract on the reversal of the acquisition of Mauell Group was concluded. Previously, Mauell had been part of the Power disposal group. Therefore, Mauell Group was measured as a separate disposal group at fair value less cost to sell as of the balance sheet date. Fair value was measured on the basis of the contractual arrangements. This resulted in an impairment loss in the amount of €6 million.
| € million | Jan. 1 - March 31 | |||
|---|---|---|---|---|
| 2016 | 2015 | |||
| Output volume (for information only) | 53 | 63 | ||
| Revenue | 54 | 62 | ||
| Expenses / income | -55 | -61 | ||
| Capital loss including impairment | -16 | 0 | ||
| EBIT | -17 | 1 | ||
| Net interest result | -1 | 0 | ||
| Earnings before taxes | -18 | 1 | ||
| Income tax income / expense | -1 | -1 | ||
| Earnings after taxes | -19 | 0 |
Under consideration of an impairment loss, a capital loss in the amount of €16 million resulted from the sale of the former Water Technologies division (see Note 3.2).
In order to present the Group's entire output volume in the interest of more complete information, we disclose our output volume in the consolidated income statement. In addition to revenue, it includes the proportion of output volume generated by consortia and amounts to €1,348 million (previous year: €1,413 million).
Scheduled amortization of €5 million was carried out on intangible assets from acquisitions (previous year: €8 million) and is included in cost of sales. Depreciation of property, plant and equipment and the amortization of other intangible assets amount to €20 million (previous year: €22 million). In addition, impairment losses on financial assets in the amount of €0 million (previous year: €2 million) were recognized.
An impairment loss of €15 million (previous year: €0 million) resulted from the measurement of the Asia-Pacific activities, as well as the steel and mechanical engineering activities of the Engineering Solutions division, which have been put up for sale (see Note 10). This is recognized in other operating income and expense.
| € million | Jan. 1 - March 31 | |
|---|---|---|
| 2016 | 2015 | |
| Interest income | 2 | 2 |
| Current interest expense | -6 | -6 |
| Net interest expense from retirement benefit liability | -2 | -2 |
| Interest expense | -8 | -8 |
| Interest expense for minority interest | 0 | 0 |
| Other financial expense | 0 | 0 |
| Total | -6 | -6 |
Deferred tax assets on tax-loss carryforwards are only recognized insofar as their realization is reasonably certain. Based on current assessments, this is not the case on particular for the losses incurred in the current financial year at Bilfinger SE and its tax-group companies, so that no deferred tax assets on tax-loss carryforwards were recognized as of March 31, 2016.
| € million | |||
|---|---|---|---|
| March 31, 2016 | Dec. 31, 2015 March 31, 2015 | ||
| Goodwill | 1,390 | 1,547 | 1,926 |
| Intangible assets from acquisitions | 70 | 80 | 107 |
| Other intangible assets | 15 | 23 | 37 |
| Total | 1,475 | 1,650 | 2,070 |
| € million | |||
|---|---|---|---|
| March 31, 2016 | Dec. 31, 2015 March 31, 2015 | ||
| Cash and cash equivalents | 392 | 429 | 308 |
| Financial debt, recourse – non-current | 511 | 513 | 516 |
| Financial debt, recourse – current | 4 | 7 | 26 |
| Financial debt, recourse | 515 | 520 | 542 |
| Net liquidity | -123 | -91 | -234 |
As of the balance-sheet date, assets classified as held for sale and liabilities classified as held for sale comprise the following disposal groups:
Contracts for the sale of the Asia-Pacific activities of the Engineering Solutions division were concluded on March 8, 2016. The transactions will be completed in the second and third quarters of 2016. The activities were classified as a disposal group accordingly and were measured at fair value less cost to sell. Fair value was measured on the basis of the determined selling price. This resulted in an impairment loss of €8 million (see Note 5).
On March 15, 2016, a contract for the sale of the steel and mechanical engineering activities of the Engineering Solutions division was concluded. The transaction will be completed in the second quarter of 2016. The activities were classified as a disposal group accordingly and were measured at fair value less cost to sell. Fair value was measured on the basis of the determined selling price. This resulted in an impairment loss of €7 million (see Note 5).
As of December 31, 2015, the Asia-Pacific activities and the steel and mechanical engineering activities of the Engineering Solutions division, which had been put up for sale, were not yet classified as held for sale. As of March 31, 2015, in addition to the disposal group Offshore Systems, the disposal groups Construction and Infrastructure, which had been sold as of the balance-sheet date, were also included.
Assets and liabilities classified as held for sale are allocated to the disposal group Power and the other disposal groups as follows:
| € million | |||
|---|---|---|---|
| March 31, 2016 | Dec. 31, 2015 March 31, 2015 | ||
| Power | 593 | 624 | 0 |
| Other disposal groups | 218 | 126 | 111 |
| Assets classified as held for sale | 811 | 750 | 111 |
| Power | 649 | 721 | 0 |
| Other disposal groups | 164 | 114 | 129 |
| Liabilities classified as held for sale | 813 | 835 | 129 |
Accumulated other comprehensive income after taxes of the disposal groups as of the balance-sheet date amounts to -€42 million (December 31, 2015: -€41 million; March 31, 2015: €6 million), of which -€1 million (December 31, 2015: €1 million; March 31, 2015: €0 million) was attributable to minority interest.
The assets and liabilities classified as held for sale of the Power disposal group are comprised as follows:
| Dec. 31, 2015 March 31, 2015 | ||
|---|---|---|
| 0 | ||
| 178 | 187 | 0 |
| 343 | 360 | 0 |
| 41 | 46 | 0 |
| 593 | 624 | 0 |
| 162 | 158 | 0 |
| 487 | 563 | 0 |
| 649 | 721 | 0 |
| March 31, 2016 31 |
31 |
The assets and liabilities classified as held for sale of the other disposal groups are comprised as follows:
| € million | |||
|---|---|---|---|
| March 31, 2016 | Dec. 31, 2015 March 31, 2015 | ||
| Goodwill | 26 | 0 | 4 |
| Other non-current assets | 124 | 98 | 44 |
| Current assets | 62 | 23 | 47 |
| Cash and cash equivalents | 6 | 5 | 16 |
| Assets classified as held for sale | 218 | 126 | 111 |
| Non-current liabilities | 4 | 7 | 10 |
| Current liabilities | 160 | 107 | 119 |
| Liabilities classified as held for sale | 164 | 114 | 129 |
The classification of equity and changes in equity are presented in the interim consolidated financial statements in the Consolidated statement of changes in equity.
Earnings after taxes (-€78 million) and transactions recognized directly in equity (-€78 million) led to a net decrease in equity of €156 million. The transactions recognized directly in equity primarily comprise the negative effects of currency translation at €45 million and losses from the remeasurement of defined-benefit pension plans at €36 million, which resulted from adjustments of the discount rate. The fair-value measurement of the securities resulted in gains of €4 million.
The company holds 1,824,383 treasury shares, equivalent to 3.96 percent of current voting rights. No cancellation of the treasury shares is currently intended.
Of the increase in provisions for pensions and similar obligations of €33 million to €429 million, €40 million reflects the adjustments of the discount rate as of March 31, 2016 (euro countries: 2.25 percent to 1.75 percent and Switzerland 0.9 percent to 0.4 percent) due to the lower interest rates. The resulting losses from remeasurement are recognized in other comprehensive income. There was a decrease in provisions for pensions and similar obligations of €5 million due to the sale of the Water Technologies division.
The methods for the measurement of fair value remain fundamentally unchanged from December 31, 2015. Further explanations on the measurement methods can be found in the Annual Report 2015.
The financial assets and financial liabilities for which the fair values deviate significantly from the carrying amounts are as follows:
| € million | IAS 39 category 1 | Carrying amount | Fair value | Carrying amount | Fair value |
|---|---|---|---|---|---|
| March 31, 2016 | Dec. 31, 2015 | ||||
| Liabilities | |||||
| Financial debt, non-recourse | FLAC | 12 | 16 | 13 | 16 |
| Financial debt recourse, bonds | FLAC | 500 | 511 | 500 | 499 |
| Finance leases, recourse | (IAS 17) | 14 | 20 | 13 | 18 |
1 FLAC: financial liabilities at amortized cost
The financial instruments that are recognized at fair value are categorized in the following fair value hierarchy levels in accordance with IFRS 13:
| € million | IAS 39 category 1 | Total | Level 1 | Level 2 | Total | Level 1 | Level 2 |
|---|---|---|---|---|---|---|---|
| March 31, 2016 | Dec. 31, 2015 | ||||||
| Assets | |||||||
| Securities | AfS | 0 | 0 | 0 | 0 | 0 | 0 |
| Derivatives in hedging relationships | (Hedge) | 4 | 0 | 4 | 3 | 0 | 3 |
| Derivatives not in hedging relationships | FAHfT | 0 | 0 | 0 | 3 | 0 | 3 |
| 4 | 0 | 4 | 6 | 0 | 6 | ||
| Liabilities | |||||||
| Derivatives in hedging relationships | (Hedge) | 1 | 0 | 1 | 2 | 0 | 2 |
| Derivatives not in hedging relationships | FLHfT | 8 | 0 | 8 | 7 | 0 | 7 |
| 9 | 0 | 9 | 9 | 0 | 9 |
1 AfS: available-for-sale financial assets
FAHfT: financial assets held for trading
FLHfT: financial liabilities held for trading
The measurement of fair value is conducted in level 1 on the basis of quoted (non-adjusted) prices in an active and accessible market for identical assets or liabilities. For level 2 the measurement of fair value is carried out on the basis of inputs for which either directly or indirectly observable market data is available (e.g., exchange rates, interest rates).
Most of the transactions between fully consolidated companies of the Group and related companies or persons involve associated companies and joint ventures.
Contingent liabilities of €81 million (December 31, 2015: €47 million) generally relate to guarantees provided for former Group companies that were sold and companies in which Bilfinger holds a minority interest. There are collaterals of buyers of the former Group companies in the amount of €49 million. In addition, we are jointly and severally liable as partners in companies constituted under the German Civil Code and in connection with consortiums and joint ventures.
Other contingent liabilities comprise in particular potential litigation charges. These include judicial, arbitrative, and out-of-court proceedings involving customers and subcontractors that file claims or may in future file claims under various contracts, for example under contracts for realestate services, maintenance, servicing, and construction projects, or claims arising out of other supply and service relationships. At this time, however, Bilfinger does not expect that these legal disputes will result in any significant negative effects on its financial position, cash flows or profitability.
The sale of the steel and mechanical engineering activities of the Engineering Solutions division was concluded on April 26, 2016 and the reversal of the acquisition of the Mauell Group was completed on April 21, 2016.
Mannheim, May 9, 2016
Bilfinger SE The Executive Board
Axel Salzmann Michael Bernhardt Dr. Jochen Keysberg
All statements made in this report that relate to the future have been made in good faith and based on the best knowledge available. However, as those statements also depend on factors beyond our control, actual developments may differ from our forecasts.
We have reviewed the interim condensed consolidated financial statements, comprising the income statement, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes, and the interim group management report of Bilfinger SE, Mannheim, for the period from 1 January to 31 March 2016, which are part of the interim financial report pursuant to Sec. 37w (7) in conjunction with (2) No. 1 and No. 2 and (3) and (4) WpHG ["Wertpapierhandelsgesetz": German Securities Trading Act]. The preparation of the interim condensed consolidated financial statements in accordance with IFRSs [International Financial Reporting Standards] on interim financial reporting as adopted by the EU and of the group management report in accordance with the requirements of the WpHG applicable to interim group management reports is the responsibility of the Company's management. Our responsibility is to issue a report on the interim condensed consolidated financial statements and the interim group management report based on our review.
We conducted our review of the interim condensed consolidated financial statements and the interim group management report in accordance with German generally accepted standards for the review of financial statements promulgated by the Institut der Wirtschaftsprüfer [Institute of Public Auditors in Germany] (IDW). Those standards require that we plan and perform the review to obtain a certain level of assurance in our critical appraisal to preclude that the interim condensed consolidated financial statements are not prepared, in all material respects, in accordance with IFRSs on interim financial reporting as adopted by the EU and that the interim group management report is not prepared, in all material respects, in accordance with the provisions of the WpHG applicable to interim group management reports. A review is limited primarily to making inquiries of company personnel and applying analytical procedures and thus does not provide the assurance that we would obtain from an audit of financial statements. In accordance with our engagement, we have not performed an audit and, accordingly, we do not express an audit opinion.
Based on our review, nothing has come to our attention that causes us to believe that the interim condensed consolidated financial statements are not prepared, in all material respects, in accordance with IFRSs on interim financial reporting as adopted by the EU or that the interim group management report is not prepared, in all material respects, in accordance with the provisions of the WpHG applicable to interim group management reports.
Mannheim, 9 May 2016
Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft
Mathieu Meyer Wirtschaftsprüfer [German Public Auditor]
Karen Somes Wirtschaftsprüferin [German Public Auditor]
| ISIN / stock exchange symbol | DE0005909006 / GBF | ||||
|---|---|---|---|---|---|
| WKN | 590 900 | ||||
| Main listing | XETRA / Frankfurt Prime Standard |
||||
| Deutsche Börse segment | |||||
| Share indices | MDAX, DAXsubsector Industrial Products & Services Idx., STOXX Europe 600, Euro STOXX, Euro STOXX Low Carbon, STOXX EUROPE TMI Support Services |
| KEY FIGURES ON OUR SHARES € per share |
Jan. 1 - March 31 | ||
|---|---|---|---|
| 2016 | |||
| Highest price | 44.15 | ||
| Lowest price | 34.31 | ||
| Closing price 1 | 37.08 | ||
| Book value 2 | 29.10 | ||
| Market value / book value 1, 2 | 1.3 | ||
| Market capitalization 1, 3 | in € million | 1,706 | |
| MDAX weighting 1 | 0.76% | ||
| Number of shares 1, 3 | 46,024,127 | ||
| Average XETRA daily volume | number of shares | 257,983 |
All price details refer to XETRA trading
1 Based on March 31, 2016
2 Balance sheet shareholder's equity excluding minority interest
3 Including treasury shares
August 10, 2016 Interim Report Q2
November 10, 2016 Interim Report Q3
Bettina Schneider Phone +49 621 459-2377 Fax +49 621 459-2761 E-mail: [email protected]
Michael Weber Phone +49 621 459-2464 Fax +49 621 459-2500 E-mail: [email protected]
Carl-Reiß-Platz 1-5 68165 Mannheim, Germany Phone +49 621 459-0 Fax +49 621 459-2366
You will find the addresses of our branches and affiliates in Germany and abroad in the Internet at www.bilfinger.com
© 2016 Bilfinger SE
Date of publication May 11, 2016
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