Key markets for GEA Refrigeration Technologies - GEA Group

Capital Markets Day 2012 

GEA Refrigeration Technologies at a Glance 

Dr. Hugo Blaum, Segment President 

Stuttgart / Frickenhausen, June 28‒29, 2012 

GEA Refrigeration Technologies

Disclaimer 

Forward-looking statements are based on our current assumptions and 

forecasts. These statements naturally entail risks and uncertainties, 

which may cause the actual results of operations, financial position or 

performance to diverge significantly from the estimates given here. 

Factors that could cause such a divergence include changes in the 

economic and business environment, fluctuations in exchange rates 

and interest rates, launches of competing products, poor acceptance of 

new products or services, and changes in business strategy. We are 

under no obligation to update forward-looking statements. 

Due to rounding, the sum of percentages of order intake and sales by 

region as well as by customer industry may vary from 100%. 

Since Q1 2012, the segment, GEA Convenience-Food Technologies 

(GEA CT), is renamed as GEA Food Solutions (GEA FS). 

2 GEA Group CMD 2012 - Presentation GEA RT Segment 


Contents 

1. Segment Management 

2. What is refrigeration? 

3. GEA Refrigeration Technologies activities and organization 

4. Product portfolio 

5. Financials 

6. Key markets for GEA Refrigeration Technologies 

7. Why does GEA need the GEA RT-Segment? 

8. Roadmap for profitable future growth 

3 

GEA Group CMD 2012 - Presentation GEA RT Segment 


Presenting the 

GEA Refrigeration Technologies Board 

Background: Dr. Hugo Blaum was born in 1951 and studied 

electrical engineering in Kaiserslautern, Germany. 

After completing his studies with a PhD at the 

University of Braunschweig, he held several 

managing positions and various supervisory board 

positions in industry. 

Personal: 

Married, two children 

GEA History: Started his career at GEA on 1 August 2002. 

Served as Division President of GEA Air 

Treatment until 31 December 2009. 

Segment President of GEA Refrigeration 

Technologies since 1 January 2010. 

Dr. Hugo Blaum 

has been the President of 

the GEA Refrigeration 

Technologies segment 

since the beginning of the 

year 2010. 

4 



Presenting the 

GEA Refrigeration Technologies Board 

Dr. Hugo Blaum 

President 

Refrigeration Technologies 

Tobias Andreae 

Vice President 

Finance 

Guido Beyß 


Technologies 

Jean-Michel Daviaud 


Sales 

5 



Contents 





5. Financials 




6 



What is refrigeration? 

For example, your fridge at home – exactly the same principle 

Compressor 

Condenser 

Evaporator 

Expansion device 

Vent fins 

In our business, refrigeration is the widespread application of the 

simple physical concepts involving expansion, compression, and 

condensation of gases 



Refrigeration cycle 

Gas @ High Pressure & 

High Temperature 

Gas @ Low 

Temperature & Pressure 

Compression 

Refrigeration cycle 

Condensed Liquid @ High 

Pressure & Ambient Temperature 

Evaporation @ Low 


Expansion 

Boiling Liquid @ Low 




Contents 





5. Financials 




9 



Our activities 

• We are one of the market leaders in providing systems based on 

refrigeration technologies for the food and energy markets 

• We manufacture compressors and valves (and GEA HX Segment 

manufactures heat exchangers i.e. condensers and evaporators) – 

key components for most requirements 

• Wherever there is a heat exchanger in our business, there is also a 

compressor 

• We manufacture a full range of freezers, all of which require 

refrigeration systems 

• We manufacture flake ice machines, ice storage systems, and 

containerized ice plants 

• We provide a full range of services ‒ from spare parts to 

maintenance and breakdown support 

Our strength is the ability to combine refrigeration components with 

innovative application know-how 

10 



GEA Refrigeration Technologies 

Activities and organization 

Locations worldwide 

Headquarter 

Technology Center 

(Production Facilities) 

Country Sales Organization 

Compact Compressors Business Unit 

11 



Contents 





5. Financials 




12 



Product portfolio 

Components 

Compact 

compressors 

Skids 

Freezers 

F&I 

Engineering 

Piston 

Compressors 

Transport 

Compressors 

Piston Compressor 

Packages 

Spiral 

Freezers 

Screw 

Compressor 

Stationary 

Compressors 

Screw Compressor 

Packages 

Tunnel 

Freezers 

Energy 

Valves 

Semi - hermetic 

Carton 

Freezers 

Service 

Ice Machines 

Open 

Chillers 

13 



Sales per business unit 

Business units (focus on food 61 % of sales) 

GEA Refrigeration Technologies sales in 2011 [in millions of €] 

647 

Other Ind. 

Pharma 

Marine 

Power 

Oil & Gas 

16% 

2% 

2% 

8% 

5% 

6% 

6% 

4% 

46% 

9% 9% 10% 

26% 

13% 

1% 

1% 1% 

1% 

1% 

2% 8% 

1% 1% 10% 

11% 

11% 

7% 

9% 

3% 

7% 

3% 

8% 

1% 

4% 

9% 

Chemical 

10% 

Clim. & Envir. 

Dairy 

6% 

5% 

66% 

Liquid (Bev.) 

Non-Liq (Food) 

51% 

54% 68% 65% 64% 100% 28% 

21% 

GEA RT 

Segment 

Compact 

Comp. 

Components 

incl. parts 

Skids 

Food and Industry 

Engineering 

Freezers 

Service 

Energy 

14 



Product R&D Focus 

R&D Focus 

Product examples 

• Natural refrigerants 

(CO2 or NH3) 

BluAstrum chiller 

• Heat recovery 

• Energy efficiency 

Refrigeration plant + 

heat pump 

Dutch 

Refrigeration 

Prize winner 

Feb 2012 

• Minimum dehydration 

Crust freezing 



GEA RT is a leader in natural refrigerants 

BluAstrum chiller 

• Using natural refrigerants 

• Maximum achievable cooling 

efficiency 

• Small dimensions (door size and 

minimum footprint) 

• Noise level reduction of 6-8 dB 

(reduction of 70% with housing) 

Customer benefits: 

• Optimized for low total cost 

of ownership 

• Environmentally friendly 

• Fits through any door 



Increased freezing efficiency 

while avoiding dehydration 

Crust freezing 

• Use of IT tools to model 

impingement airflow and to 

optimize impingement jet 

• Creation of a cruster to retrofit 

on existing or new machinery 

• Enables rapid freezing of product 

• Minimum dehydration: 50% 

reduction of water (weight) loss 

compared to other freezing 

processes 

Customer benefits: 

• Improved product quality 

• Higher yields and lower 

energy costs 

• Pay back within 1.7 years 



Energy efficiency through heat recovery 

Collaborative solution with customer Müller Milch 

+2°C milk cooling 

+76°C milk pasteurizing 

Reduction of: 

• electrical energy for cooling: >20% 

• gas usage: >50% 

• water usage: >50% 

• CO 2 emissions: 2,000 tons/year 

Savings in operating costs: 

260,000 €/year 



Contents 





5. Financials 




19 



Financials 

Rolling L4Q Order Intake, Sales and EBIT-Margin 

[in EUR million] 

Notes: 

• Rolling last 4 quarters (L4Q) order intake, sales, and EBIT all return to 2008 levels by mid 2011 

• EBIT shows the more pronounced recovery due to GEA Bock acquisition and the effects of the 

2010 restructuring 

20 



Contents 





5. Financials 




21 



Key markets for GEA Refrigeration Technologies 

Range of applications 

Heat pumps in 

greenhouses 

Normal cooling 

retail food 

Ice water in 

dairy industries 

Ice rinks 

Freezing 

retail food 

Cooling storage 

for food 

Freezing for 

foodstuffs 

+70°C 

+50°C 

+21°C 

+6°C 

+5°C 

0°C 

-10°C 

-16°C 

-20°C 

-25°C 

-35°C 

-40°C 

-54°C 

Heat pumps for 

energy savings 

Bus & rail AC 

HVAC for buildings 

Process cooling 

for breweries 

Process cooling for 

chemicals and 

pharmaceuticals 

R&D Test chambers 

for industry 

22 




Order Intake by Region 

Order Intake by Customer Industry 

Latin America 

Middle East 

Africa 

1% 1% 2% 

4% 4% 

5% 

6% 8% 

9% 

12% 

12% 

13% 

8% 

10% 

11% 

15% 

7% 

10% 

9% 3% 

1% 

3% 

2% 

6% 

9% 

6% 

7% 6% 

16% 

1% 

3% 

6% 

6% 

8% 

Other Industries 

Power 

Marine 

Eastern Europe 

& CIS 

15% 

13% 

Climate & 

Environment 

(Cold Stores) 

Asia - Pacific 

North America 

58% 

50% 

43% 

65% 66% 

60% 

Chemicals (Gas 

Compression) 

Oil & Gas 

Western 

Europe 

Food & 

Beverages 

2009 2010 2011 

2009 2010 2011 

23 




Growth Drivers – Food and Energy 

Megatrend Significance for demand Demand relevant for GEA 

Steady growth in global 

population 

Continuously rising 

demand for food and 

energy 

Volume growth and catch-up 

potential especially in South and 

East Asia, Latin America and, 

in future, Africa 

Urbanization/ 

expansion of middle class 

Rising energy costs/ 

environmental regulations 

Growing quality 

requirements for 

foodstuffs and 

pharmaceuticals 

Growing interest in 

efficient production 

processes that 

conserve resources 

Processed foods/ready meals 

Aseptic filling/enriched lifestyle 

drinks 

Pharmaceuticals 

Resource-conserving 

technologies/dry cooling 

Energy-saving machines and 

processes/heat recovery 

“Intelligent” engineering 

solutions 

24 




Importance of the food sector to our growth 

Diet 

Component 

Developing 

Markets 

Developed 

Markets 

Functional 

Foods 

USA Japan 

W. Europe 

Prepared 

Foods 

Meat, Dairy 

Fruit & Veg. 

Eastern 

Europe 

China 

India L. America 

Incomes 

Grain 

Roots 

Sub-Saharan 

Africa 

Survival Staples Variety Convenience High-tech 

Source: UN, Rabobank 

Diet Profile 

Refrigeration is key to this development 

Resulting in growth of Refrigeration Technologies market 

25 



Contents 





5. Financials 




26 



Synergy potential with other GEA Segments 

Sector Industry 

Market 

Application 

GEA w/o RT GEA RT 

Food & 

Beverages 

DAIRY 

LIQUID 

NON-LIQUID 

Dairy Processing 

Beverages Non-alcoholic 

Beverages Alcoholic 

Raw Food 

Milk Production 

Processed Food 

Food Ingredients 

Milk Production 

Active 

Farm Equipment 

Active 

Farm Supplies 

Active 

Drinking Milk Active Active 

Yogurt, Sour Milk Drinks Active Active 

Cheese Active Active 

Butter Active Active 

Ice Cream Active Active 

Milk Powder / Whey Powder 

Active 

Baby Food (milk formula) 

Active 

Dairy Ingredients (whey, lactose, casein) 

Active 

Fruits & Vegetables Juice Active Active 

Soft Drinks (Carbonated) Active Active 

Bottled Water 

Active 

Coffee / Tee (instant) Active Active 

Beer Active Active 

Wine Active Active 

Spirits 

Active 

Meat / Poultry Active Active 

Fish / Shrimp Active Active 

Fruits / Vegetables Active Active 

Bakery / Dough Active Active 

Confectionary Active Active 

Convenience Food Active Active 

Baby Food (non-milk formula) 

Active 

Animal Fats 

Active 

Edible Oils 

Active 

Starch 

Active 

Sugar 

Active 

Other Food Ingredients 

Active 

=> GEA RT delivering into same markets across different process steps shows 

synergy potential with other GEA segments 

=> GEA RT offers essential products and innovations for high quality food 

process technology applications 



Food application poultry 

Process chain 

Slaughtering 

Cold chain 

Processing 

Products 

GEA HX Segment 

GEA FS Segment 

GEA RT Segment 



Freezing 

Frozen + processed 

product 

Transport 

Distribution 


GEA FS Segment 





28 



Food application: raspberry freezing 

Seasonal process 

• 1 month crop: mid May to mid June 

• Raspberries go directly from the field into the freezing line 

Focus 

• Colour, flavour, shape and nutritive value of these tender 

fruits must be preserved 

• Very fragile product, requiring extremely gentle 

product handling 

• Prevent sticking to the freezer belt and subsequent tearing 

• If frozen too slowly, large ice crystals break product 

structure and raspberries get poor aspect when defrosting 

=> Freezing technology from GEA RT Segment fits to 

process technology offered by other GEA segments to 

secure high quality within the food production 



Synergies/relationships with other GEA Segments 

Some specific examples of cross-segmental cooperation: 

• GEA PE and GEA RT joined on projects for 

Ceres, fruit juice plant in South Africa: 

and Nestlé, industrial air conditioning (CFC replacement): 

30 



Contents 





5. Financials 




31 



Develop component business to factory- 

Assembled and configurable products 

Definition of “components” and “skids” 

BU Skids BU Components 

32 



Serving smaller contractors by modular skids 

and downsizing our own contracting activities 

Reduced contracting activity and efficiency improvements 

In 2010 we changed our approach to contracting activities: 

Projects must have strategic objectives beyond more volume 

Profitability thresholds must be met by selecting only added-value projects 

Process improvement initiatives were implemented 

Quality/performance leader versus price leader 

The outcome of this was: 

A restructuring program (completed in 2010) 

A reduction in contracting volume 

EBIT % of contracting activity significantly increased 

In 2011 we significantly increased the profitability of our contracting 

activity and reduced volume where needed 



Centralized regional engineering and assembly 

Standardize modular designs and assembly for efficient delivery 

to the market 

Change sales approach to the market, with more emphasis 

on module sales to 3 rd party contractors/installers 

More efficient local structures to increase volume 

Shared resource for developing common market applications 

Platform to integrate GEA Bock applications 

Compressor factories freed up to focus on predefined standard 

components and packages 

Following the profitable modular approach to the US market, and 

now successful growth in China with the same approach, we will 

implement the same model in Europe. 

34 



Lean manufacturing and internationalized production 

“Glocalization“ of production: 

• Local sourcing (e.g. China, India) 

• Local assembly 

Increased efficiency of workflow: 

• From box assembly to flow production 

• Minimize logistic movements 

• Reduction of throughput time by up to 30% 

• Minimize raw material inventory 

• Zero defects 

Status of plant optimization: 

• Finished in Berlin 

• Finished in The Netherlands 

• Ongoing in France 

35 



Emerging markets growth potential 

Geographical growth in new markets : 

• South East Asia 

• Food (well established) 

• Now starting to enter energy market 

• China 

• Energy (recently established) 

• Now starting to enter the food market 

• Russia 

• Food (well established) 

• Energy now becoming a major opportunity 

• Latin America 

• Focus in Brazilian food market with freezers and 

refrigeration plants (now entering) 



Development of service business 

Opportunities for profitable growth: 

Increase installation base from sales 

to 3 rd party contractors (skids+) and 

thereby increase profitable spare 

parts sales 

Accelerate service growth in 

maturing markets: e.g., Eastern 

Europe, Middle East 

€m 

220 

200 

180 

160 

140 

120 

100 

Service sales development 

2009 2010 2011 

Development of ‘added value’ service products: e.g., energy 

efficiency 

Continuous efficiency improvement of local service networks: e.g., 

IT tools (SMART) to improve administration/communication 

Increase freezer service and spare parts business through 

existing refrigeration service networks 

37 



Improvement of TCO for V-series 

GEA Grasso V-series challenges the Total Cost of Ownership: 

Lowest operational costs for the end user: 

1. Minimum energy costs due to high energy 

efficiency (80%-90% of TCO for energy. With 

V series up to 6% lower energy costs) 

2. Longer maintenance intervals from 

6,000 hrs to 15,000 hrs, resulting is less 

maintenance costs and less downtime 

for the end-user 

3. Minimum investment costs / depreciation (lower 

price per kW cooling capacity up to 20%) 

4. Maximum reliability because of less unplanned 

down time (this is of course 

for a food producer very important) 



GEA Bock complementary product range 

Cold chain and compressor sizes 

Pieces 

100.000 

Consumer 

Store 

Transportation 

Distribution 

center 

Transportation 

Manufacturer 

Commercial 

Commercial + industrial 

Industrial 

100 1,000 

10,000 

Swept volume m 3 /h 

39 

GEA Bock 

compressors 

The installed number of compressors increases 

at smaller capacities 

GEA Refrigeration Technologies compressor portfolio is 

now serving all applications in the cold chain 


GEA Grasso 

compressors 


Summary 

How to further increase value of GEA Refrigeration Technologies 

• Innovation and product development with focus on energy savings 

and by using natural refrigerants are a trend setter in our business 

• Further efficiency gains within contracting business 

• Cost savings and working capital reduction leading to higher cash 

flow driver margin due to leaner manufacturing processes and 

better design to cost approach 

• Additional component business coming from new markets entry 

• Further increase of service business

Key markets for GEA Refrigeration Technologies - GEA Group

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