Annual Report 2015

Transcription

Annual Report 2015

Annual Report
2015
The BAUER Group is an international construction and machinery manufacturing
concern based in Schrobenhausen, Bavaria. The stock market-listed holding
company BAUER Aktiengesellschaft is the parent of more than 110 subsidiary
businesses across its Construction, Equipment and Resources segments. Bauer
is a leader in the execution of complex excavation pits, foundation and vertical
seals, as well as in the development and manufacture of related machinery for
this dynamic market. The Group also deploys its expertise in the exploration,
mining and safeguarding of valuable natural resources. In 2015 the companies
of the BAUER Group employed some 10,738 people in around 70 countries and
achieved total Group revenues of EUR 1.66 billion.
Passion for progress –
The origins of Bauer date back as far as 1790, and still today the company's
success is founded on highly flexible application of the specialist know-how it
has built up over those many years. As an innovator and technology leader,
Bauer has played a major role in the advancement of the international specialist
foundation engineering industry and related busniess fields. Indeed, today Bauer
is also the world market leader in the manufacture of the relevant machinery. It is
with just such innovative strength and a keen focus on the challenges of the future
that the Group is also developing its recently established Resources segment.
The Group at a glance
GROUP KEY FIGURES 2012 – 2015
IFRS in EUR million
2012
2013
2014 **
2015
1,435.8
1,504.2
1,560.2
1,656.4
6.2 %
378.6
410.4
440.2
473.7
7.6 %
1,057.2
1,093.8
1,120.0
1,182.7
5.6 %
73.6
72.7
71.8
71.4
n/a
Construction
655.2
741.7
725.6
742.9
2.4 %
Equipment
589.1
628.6
639.2
753.1
17.8 %
Resources
262.8
188.9
252.8
221.6
-12.3 %
Other/Consolidation
-71.3
-55.0
-57.4
-61.2
n/a
Consolidated revenues
1,376.1
1,447.5
1,506.0
1,587.9
5.4 %
Sales revenues
1,344.4
1,402.2
1,375.7
1,379.0
0.2 %
Order intake
1,470.8
1,484.5
1,521.1
1,811.4
19.1 %
Order backlog
785.0
765.2
762.7
995.6
30.5 %
EBITDA
163.8
124.0
171.0
185.1
8.2 %
EBITDA margin in % (of sales revenues)
12.2
8.8
12.4
13.4
n/a
EBIT
72.0
30.1
76.4
90.7
18.7 %
5.4
2.1
5.6
6.6
n/a
Net result for the period
25.8
-19.4
15.7
29.0
84.7 %
Capital investment in property, plant and equipment
96.4
91.9
64.1
83.2
29.8 %
462.5
419.8
418.9
451.2
7.7 %
30.2
26.5
26.6
27.2
n/a
1,529.4
1,585.8
1,575.1
1,656.9
5.2 %
Earnings per share
1.44
-0.99
0.85
1.73
n/a
Distribution
5.14
0.00
2.57
2.57*
n/a
Dividend per share in EUR
0.30
0.00
0.15
0.15*
n/a
5.6
-4.2
3.7
6.9
n/a
10,253
10,264
10,405
10,738
3.2 %
Germany
4,090
4,144
4,158
4,166
0.2 %
International
6,163
6,120
6,247
6,572
5.2 %
Total Group revenues
of which
Germany
International
International in %
of which
EBIT margin in % (of sales revenues)
Equity
Equity ratio in %
Net assets
Return on equity after tax in %
Employees (on average over the year)
of which
Change
2014/2015
* Proposed; subject to the consent of the Annual General Meeting to be held on June 23, 2016
** Previous year adjusted; see notes on page 106
At variance with the consolidated revenues presented in the Group income statement, the total Group revenues
presented here include portions of revenues from associated companies as well as revenues of non-consolidated
subsidiaries and joint ventures.
>>>
DEVELOPMENT OF TOTAL GROUP REVENUES BY SEGMENT
Construction
Equipment
Resources
2012
1,436
2013
1,504
2014
1,560
2015
1,656
CONSTRUCTION SEGMENT KEY FIGURES
in EUR '000
2014 *
2015
725,626
742,862
2.4 %
Sales revenues
646,628
650,762
0.6 %
Order intake
682,410
878,436
28.7 %
Order backlog
455,485
591,059
29.8 %
26,033
13,916
-46.5 %
2,524
-7,316
n/a
5,777
6,243
8.1 %
EBIT
Change
EQUIPMENT SEGMENT KEY FIGURES
in EUR '000
2014 *
2015
Change
639,151
753,083
17.8 %
Sales revenues
532,691
548,039
2.9 %
Order intake
676,801
649.108
-4.1 %
Order backlog
154,175
128,096
-16.9 %
35,952
99,441
n/a
8,847
65,397
n/a
2,936
2,919
-0.6 %
2014
2015
Change
252,830
221,609
-12.3 %
Sales revenues
195,860
179,319
-8.4 %
Order intake
219,306
345,045
57.3 %
Order backlog
153,027
276,463
80.7 %
15,932
-19,807
n/a
4,347
-29,398
n/a
1,400
1,276
-8.9 %
EBIT
RESOURCES SEGMENT KEY FIGURES
in EUR '000
EBIT
* Previous year adjusted; see notes on page 106
GROUP KEY FIGURES AT A GLANCE
in EUR million
BAUER Aktiengesellschaft
Annual Report 2015
2
Milestones in the Company's History
4
Pictures of 2015
6
Mission and Strategy
8
The World is our Market
71
Balance sheet and income statement
of BAUER Aktiengesellschaft
in accordance with HGB
75
Consolidated financial statements
in accordance with IFRS
10
Foreword
164
Assurance by the legal representatives
13
Combined Management Report
165
Audit opinion
62
The Bauer Share
166
Glossary
64
Corporate Governance Report
168
Imprint
68
Report of the Supervisory Board
2
Milestones in the Company's History
1790
1956
Sebastian Bauer acquires a coppersmith's shop in the
Dr.-Ing. Karlheinz Bauer, a shareholder in the company
center of Schrobenhausen; in the 19th century, subsequent
since 1952, becomes sole managing director; construction
Bauer generations were engaged in copper working,
of a first office building in Wittelsbacherstrasse
primarily for breweries and domestic households
Dipl.-Ing. Karl Bauer (left) turned the company into
an industrial well builder known throughout Bavaria.
Dr.-Ing. Karlheinz Bauer (center) led the company onto
1840
the international stage, taking it into the field of specialist
Copper cladding for the steeple roof of St. Jakob's church
foundation engineering and launching equipment manu-
in Schrobenhausen
facturing operations. Prof. Dr. Dipl.-Kfm. Thomas Bauer
shaped the current global Group, with a network of
1900
operations on every continent.
Start of well drilling by Andreas Bauer
1790 – 1948
1956 – 1984
1902
1958
Drilling of an artesian well for Schrobenhausen railway
Invention of the injection anchor on the construction site
station
of the Bayrischer Rundfunk building in Munich
1969
First anchor drilling rig UBW 01
1972
Construction of the new head office administration block
1975
First contracts in Libya, Saudi Arabia and the United Arab
Emirates
1928
Dipl.-Ing. Karl Bauer constructs the Schrobenhausen water
1976
supply system; construction of wells and water pipes
First heavy-duty rotary drilling rig BG 7
throughout Bavaria
1984
1948
Work complex West begins operations; manufacture and
First works on Wittelsbacherstrasse
deployment of the first trench cutter
MILESTONES IN THE COMPANY'S HISTORY
1986
2007
Prof. Thomas Bauer becomes sole managing director
Founding of BAUER Resources GmbH, entailing a restructuring
of BAUER Spezialtiefbau GmbH and drives forward the
of the mining and environmental business; market launch of the
international growth of the Group
three new segments: Construction, Equipment and Resources
1990
2008
Founding of BAUER und MOURIK Umwelttechnik GmbH
Expansion of machinery manufacturing capacities in Aresing
and of SPESA Spezialbau und Sanierung GmbH
and Nordhausen as well as in Tianjin and Shanghai, China
1992
2009
Takeover of SCHACHTBAU NORDHAUSEN GmbH
The BAUER Group completed the largest investment
program in the company's history: new administration
building in Schrobenhausen, Edelshausen plant, machinery
manufacturing plant in Conroe, Texas, USA
2011
The first deep drilling rig is sold to South America
2012
During the year, the Group's global workforce topped the
10,000 mark for the first time
1986 – 2006
2007 – 2015
1994
2013
Founding of BAUER Aktiengesellschaft
Bauma Innovation Prize for an underwater drilling technique
1998
2014
Takeover of KLEMM Bohrtechnik GmbH
Execution of the Schwarzkopf Tunnel bypass railway project
in Lower Franconia
2001
BAUER Maschinen GmbH becomes independent company
2002
Purchase of large machinery manufacturing facility in Aresing
2003 – 2005
Specialist companies in a variety of fields are acquired
and integrated into the BAUER Group: FWS Filter- und
Wassertechnik GmbH; PRAKLA Bohrtechnik GmbH;
TracMec Srl, Imola, Italy; Pileco, Inc., Houston, Texas, USA
2015
Joint Venture in the field of deep drilling technology with
2006
Schlumberger, the world's leading supplier of technology
BAUER AG is listed on the stock market
and project management for oil and gas industry customers
3
1
1
2
3
Pictures of 2015
Major Dam Project on Mauritius
1
depth. Three duty cycle cranes of the type MC 96 and MC
Mauritius – The island nation of Mauritius is getting a new
128 with a BC 40 trench cutter, as well as two grabs were
dam for a water reservoir that will ensure supply of drinking
used.
water for the population. The last panel of the cut-off wall
was constructed on 9 May, almost exactly a year after work
Despite plenty of rainfall, the country has problems with
commenced for the EUR 35 million Bagatelle Dam Project.
ensuring water supply because of lack of storage capacity
Reason enough for a small celebration, which Prof. Thomas
on the island. The Bagatelle Dam Project will change that.
Bauer, Chairman of the Management Board of BAUER AG,
The Ministry of Energy and Public Utilities of Mauritius is the
also took part in, along with the Chinese ambassador as well
client.
as representatives of the China International Water & Electric
Corp., the project's main contractor.
Ground-breaking ceremony for the largest-ever
contract
2
Bauer Spezialtiefbau constructed a 2.4 km long diaphragm
Schrobenhausen/Grenzach-Wyhlen, Germany – Remediation
cut-off wall (56,781 m2), socketed into rock. The soil partially
of perimeter 1/3 northwest of the former Kesslergrube landfill
2
consists of very hard basalt – about 20,000 m of slightly to
started at the end of September. Last July, Roche Pharma AG
moderately weathered basalt had to be penetrated over the
awarded Bauer as the general contractor for the remediation.
entire structure for the new dam. Furthermore, in the central
BAUER Umwelt GmbH will be responsible for tasks such as
dam area, heavy layers of basalt, up to 28 m deep, were re-
site mobilization and operations, all civil engineering activities,
moved in order to construct the cut-off wall with the specified
the excavation, removal and thermal disposal of the soil as well
2
4
4
as the refill of the excavated pit. This is the BAUER Group's
that the fourth kimberlite pipe, located under the waters of
largest single contract to date. According to the motto “Let’s
Lac de Gras, can be mined using the openpit method. Bauer
go”, around 60 guests celebrated the ground-breaking cere-
suggested using the Cutter-Soil-Mixing method (CSM), which
mony. This event marked the official start of the remediation of
combines diaphragm wall technologies and the Mixed-in-Place
perimeter 1/3 northwest of the former Kesslergrube landfill.
method. The project will be completed in two stages in 2016
and 2017.
Back to the Canadian polar circle
3
4
Yellowknife, Canada – In August, BAUER Foundations Canada
In-house exhibition 2015
Inc. acquired a major project worth about EUR 65 million to
Schrobenhausen, Germany – It has become a tradition that
build a cut-off wall for the Diavik Diamond Mine in Canada.
is especially appreciated by clients and partners of the BAUER
Maschinen Group: the in-house exhibition. In April, BAUER
The Diavik mine is operated by Diavik Diamond Mines (2012)
Maschinen GmbH and its subsidiaries showcased a number
Inc., a member of the Rio Tinto Group, and is located approxi-
of innovations and further developments as well as proven
mately 220 km south of the Arctic Circle. From 2000 to 2002,
technology as part of this exhibition. Nearly 1,700 guests
BAUER Maschinen GmbH – in partnership with other com-
from more than 70 countries accepted the invitation again
panies and using a range of equipment – was involved in the
and traveled to the company's headquarters in Schroben-
construction of the water retention dikes that enabled open-
hausen in Upper Bavaria.
pit mining of diamonds from the first three kimberlite pipes.
A 26 m deep cut-off wall is required for the 2.2 km dike so
6
Mission and Strategy
OUR MISSION
>>> SERVICES, EQUIPMENT AND PRODUCTS DEALING
WITH GROUND AND GROUNDWATER
>>> Target: ~ 40 percent of total Group revenues
>>> Market leader in specialist foundation engineering
machinery and equipment
>>> New products for mining, deep drilling and offshore
drilling
>>> 80 percent of sales generated outside of Germany
>>> Multi-branding strategy
MISSION AND STRATEGY
OUR STRATEGY
>>>
The world is our market
>>>
World market leadership in specialist foundation
technologies
>>>
>>>
Optimization of worldwide organizational structures
and of the Group's self-managed business units
>>>
Annual growth from 3 to 8 percent
>>>
Target: ~ 20 percent of total Group revenues
>>>
Activities in environmental technology, mining,
Powerful development of drilling techniques
and applications for related markets such as
environment, water and natural resources
deep drilling, well construction, materials
>>>
Target: ~ 40 percent of total Group revenues
>>>
Global provider of specialist foundation engineering services
>>>
Specialist construction services
>>>
Focus on complex international projects
7
8
The World is our Market
OVER
110
IN MORE THAN
GROUP COMPANIES
70
COUNTRIES
EUR
1.66 BILLION TOTAL
GROUP REVENUES
10,738 EMPLOYEES
FROM
77 NATIONS
THE WORLD IS OUR MARKET
25 PRODUCTION FACILITIES
and many other service centers and construction yards
Construction
Equipment sales
Resources
Equipment production locations
9
10
Foreword
Dear Shareholders, Partners and Friends of our company,
Ladies and Gentlemen,
2015 was once again a year with many challenges. Comparing the forecast presented one year ago against the key figures that
have now been achieved – total Group revenues of EUR 1.66 billion and earnings after tax of EUR 29.0 million – it is tempting
to assume that our business figures have exceeded our forecasts. However, this is only one side of the coin. The figures for the
2015 business year are composed of such a large number of positive and negative individual themes that the first impression is
not sufficient for such an assessment.
Basically, it can be observed that we achieved a positive Group result solely in operative terms, without however being able to
meet our forecast in full.
Our Construction segment performed well on the whole. We have successfully processed numerous projects in all regions of
the world. With the exception of only individual weaker markets, we suffered a significant loss in the USA above all. This was
due to delays in acceptance of the Center Hill Dam project extending over several months, and additional follow-on problems
with the local subsidiary. Consequently, the segment was not able to record a positive result.
In the Equipment segment, we were able to give a good account of ourselves in a market environment that remains very difficult –
operatively speaking, the parent company and most of the subsidiaries achieved a solid result. In addition to this, two special
topics delivered significant positive earnings contributions. One contribution to this was the foundation of the joint venture with
Schlumberger, the world's leading oil services provider, to build deep drilling rigs. As part of a capital increase, Schlumberger
has invested in two subsidiaries, resulting in significant exceptional earnings. Moreover, the sale of shares in our subsidiary for
tensioning and anchor technology delivered a further good profit.
The Resources segment experienced two contrasting developments during the past year. The subsidiaries in the environmental
and water business had a good commercial year. On the other hand, companies involved in water and exploration drilling suffered
significantly from the steep decline in raw materials markets. Consequently, it was scarcely possible to achieve capacity utilization.
This, combined with significant restructuring, represented the main reason for the negative result in the segment.
Given the positive exceptional earnings, it was possible for us to undertake extensive restructuring measures in all areas of the
Group that became necessary due to significant market changes. In the Resources segment above all, business activities no
longer offering prospects for success were terminated, capacities reduced and subsidiaries shut down. In the Equipment segment too, it was necessary for smaller Group companies and their products to be re-orientated.
Taking a look at all these topics, it becomes clear how the significant variations occurred in the revenues and earnings figures
of the individual segments. The business activities relevant for the future also delivered good, positive operational results in the
year under review. Assessing the results without special influences leads to the conclusion that our businesses are on the right
path overall. The numerous measures that have been taken form a good starting point for the years to come.
The very high order backlog that we have been able to achieve in the Construction and Resources segments above all indicates
our strength in the market. In the environmental business, we are working on some long-term orders including the largest individual
order in the company's history with a remediation project in Germany. In Construction, the order backlog is evenly distributed
throughout the world, meaning that all regions have a good workload. Moreover, there are also new, large projects in the market
which represent good opportunities for us.
FOREWORD
Hartmut Beutler
Prof. Thomas Bauer
Heinz Kaltenecker
The Equipment business remains highly competitive. Chinese manufacturers have had to post significant drops in sales because
of the weakness in their domestic market and have responded with swingeing cuts in their capacities; we on the other hand have
performed well. We have got to continue the success. Unfortunately, entirely satisfying margins will only be achieved over time –
the competition will return to normal, however.
The joint venture with Schlumberger represents a major opportunity. In recent years, we have worked hard to develop not only
expertise but also innovative and novel techniques for deep drilling rigs. The fact that the largest oil services provider in the world
is now working with us in this field represents a pleasing success and points the way to the future.
In spite of this relatively good starting point, we do however see problems in the world as well. These include the developments
in Russia and China, and events in the Middle East where not only the so-called Islamic State but also the low oil price are sowing
the seeds of great uncertainty. The oil price in particular represents a significant danger for individual states whose budgets are
significantly dependent on oil exports. These include countries in South America and the Far East, as well as the Middle East.
A sustained low oil price will result in reductions in spending by many countries, and without doubt construction companies will
also be victims of this.
On the one hand, we can look to the future with optimism because we are offering products and services that are urgently required
over the coming decades. And additionally, we have re-orientated our companies in many respects. On the other hand, instabilities
in the world will also represent a major challenge in future.
As a result, we are cautiously optimistic for the coming year. For 2016, we are expecting total Group revenues of about EUR 1.65
billion and earnings after tax of about EUR 20 to 25 million.
I would like to express my sincere gratitude to all employees, shareholders, customers and partners for their loyalty and support.
Recent years have been very challenging, and we are faced with new tasks. The management and all the workforce are highly
motivated to build on the experience and the accrued strengths of the company in developing future success. You can follow
us on this path!
Kind regards,
Prof. Thomas Bauer
11
13
15
I.
The Group
15
Group structure
15
Corporate Governance and control system
17
II.
Business Report
17
Macro-economic trend
18
A general view of our markets
20
Course of business
22
Construction segment
24
Equipment segment
26
Resources segment
28
Other / Consolidation segments
32
III.
Earnings, financial and net asset position
32
Group earnings position
34
Group financial and net asset position
39
IV.
Financial statements of BAUER Aktiengesellschaft
40
V.
Sustainability
40
Sustainability in the BAUER Group
40
Employees
42
Capital Investments
42
Research and Development
44
Health Safety Environment (HSE)
44
Quality
45
VI.
Legal disclosures
45
Remuneration Report
47
Statutory disclosures regarding takeovers
49
VII.
Follow-up Report
51
VIII.
Risk and Opportunity Report
51
Risk Report
57
Opportunity Report
59
IX.
Forecast Report
Changi Airport in Singapore is being expanded by an area of 1,000 hectares. The entire area must be improved with 480,000 soil
mixing columns. Several Bauer machines are being used there.
15
I. THE GROUP
GROUP STRUCTURE
As part of central strategies, goals and regulations, the main
The BAUER Group is a leading provider of services, equipment
companies in the three operating segments – BAUER Spezial-
and products related to ground and groundwater. With over
tiefbau GmbH, BAUER Maschinen GmbH and BAUER Re-
110 subsidiaries, Bauer operates a worldwide network on
sources GmbH – develop their own detailed strategies which
all continents. The operations of the Group are divided into
are converged at holding company level and integrated into
three future-oriented segments with high synergy potential:
the strategic corporate planning process.
Construction, Equipment and Resources.
The development and implementation of a self-managing
The Construction segment applies all the established methods
organizational structure with decentralized business units is
and techniques of specialist foundation engineering all over
the primary characteristic of corporate governance within
the world. These include creating complex excavation pits,
the BAUER Group. The managers of the various Group
foundations for large infrastructure projects and buildings,
companies operate under their own responsibility, and are
cut-off walls and ground improvements. Its specialist con-
provided with a large degree of independence within the
struction unit also performs other construction services such
framework of the corporate strategy in determining how
as civil engineering and remediation works.
their business units progress.
Bauer is a world market leader in the Equipment segment
The autonomous management of the individual operating
and provides a full range of equipment for specialist foun-
business units is constrained by framework guidelines and
dation engineering as well as for the exploration, mining and
standards laid down by the Group and the individual subsi-
extraction of natural resources. Besides its headquarters
diaries. The principles of proper conduct, including adherence
in Schrobenhausen, the Equipment segment operates a
to our ethical and moral standards, are defined among other
worldwide distribution network and additional production
instances by an ethics management and values program
facilities in Germany, China, Malaysia, Russia, Italy, Turkey,
covering all the companies of the BAUER Group, flanked by
the USA among other locations.
corporate management guidelines and a code of conduct
imposed on our employees. The self-managing structure
In the Resources segment, Bauer focuses on highly innovative
is linked to a centralized system of risk management and
products and services in the areas of water, environment and
control, and to a central Group accounting function. Internal
natural resources. BAUER Resources GmbH is the holding
auditing systems monitor compliance with laws and standards
company of the business segment, under the umbrella of
across the Group.
which the subsidiaries operate as full-service providers with
their focus on environmental technology, water and natural
The roles of the Management Board and Supervisory Board
resources for industrial customers.
and other aspects of corporate governance are set forth in the
Declaration on Corporate Governance on pages 64 to 67
BAUER Aktiengesellschaft is the holding company of the Group
of this Annual Report, which is published on the Internet at
and is listed on the Frankfurt Stock Exchange. BAUER AG
http://www.bauer.de/ in the Investor Relations section under
provides central management and service functions for its
Reports & Accounts.
affiliates. These specifically include human resources, accounting, finance, legal and tax affairs, IT, facility management, and
Financial performance indicators
health, safety and environment (HSE).
The trend in total Group revenues is used as the fundamental
and significant key financial performance indicator for the
CORPORATE GOVERNANCE AND CONTROL SYSTEM
management of the Group. The total Group revenues rep-
The principal task of the Management Board of BAUER AG
resent the revenues of all the companies forming part of our
is the strategic management of a global group of companies.
Group. The difference between the consolidated revenues
The Gut Großlappen sewage treatment plant on the northern outskirts of Munich is being updated to the latest state of the art.
For the connecting lines from the clarification tanks to the biological clarification stage, Bauer built six individual excavation pits
encompassing a total area of about 12,500 m² static Mixed-in-Place cut-off wall.
COMBINED MANAGEMENT REPORT
The Group
and the total Group revenues is derived from the revenues
They primarily comprise balance sheet and income statement
of the associated companies, from our portion of revenues
figures and the indicators of capital structure, profitability and
in joint ventures, and from the revenues of non-consolidated
liquidity derived from them.
companies. The trend in total Group revenues and the contributions to them by the various segments are depicted in
Non-financial performance indicators
the Business Report.
Many non-financial indicators of Group performance are
measured as part of a comprehensive reporting system,
Alongside total Group revenues, earnings before interest and
although they have no individual material significance in
taxes (EBIT) and the net result for the period are used as key
terms of internal controls and other respects. The reporting
financial performance indicators for internal management. The
on trends in those performance indicators in the „Sustainability“
Business Report details the trends in EBIT and net result for
section is primarily intended to convey an overall picture of
the period and trends in the various segments.
the operations of the BAUER Group.
A wide range of other financial performance indicators, which
The indicators included originate, among other sources, from
are of comparatively minor significance to the medium- and
the Human Resources function, such as workforce numbers.
long-term development of the Group, are collated and inte-
Indicators on further and advanced training as well as others
grated in the course of internal Group management activities.
derived from the Research and Development field are also
reported.
>>>
16
Our customer Botte Fondations carried out the diaphragm walling work for an underground garage in Paris. An MC 64 duty-cycle
crane with an MBC 30 trench cutter was used.
Business Report
II. BUSINESS REPORT
MACRO-ECONOMIC TREND
We can therefore basically expect favorable growth during
There has hardly been any previous year in which the world has
the next few years.
seen so many crises and problem areas as in 2015. Despite the
numerous achievements of society in communications and
This fundamentally positive outlook is contrasted by the
mobility, which might have been expected to bring the nations
negative influences of political, economic and warlike
together, the world has not developed positively – on the
confusion:
contrary. All the changes also affect economic development,
which is burdened with constantly increasing negative
• The after-effects of the financial market crisis seven years
phenomena. However, they are counteracted by many
ago can still be felt. The entire financial system of the global
positive stimuli from globalization. Overall therefore, the
economy was rocked by that shock. Only massive govern-
normally possible expectations could not be fulfilled.
ment measures managed to avert a collapse of the financial
markets. Many countries slid into recession. The situation
Only a short while ago, all major research institutes anticipated
has stabilized somewhat since then, but many countries
growth rates ranging from 3.5 to 4 %. These forecasts have
have been unable to regain their old strength. Many banks
since been continuously adjusted in the direction of 3 % – and
still suffer today from the massive capital consumption of
the downtrend continues.
that period. A process of adaptation with many ups and
downs still prevents a sustainable economic stabilization.
For the construction industry, however, just over 3 % growth
This trend will accompany us for quite a while to come.
remains a good base for its international business, since the
global economy can only grow if the construction of buildings
• The financial market crisis has saddled quite a few countries
and infrastructure creates the necessary preconditions. Even
in Europe with considerable budgetary difficulties. This has
better growth expectations beckon for companies in the sector
focused more attention on problems which were created
of specialist foundation engineering, since construction is taking
many years ago by incorrect budgetary management. In
place in increasingly confined urban areas. This demands
addition, countries had to intervene in order to rescue
progressively higher buildings, which calls for extensive foun-
troubled banks and stabilize their economies. In countries
dation work. In addition, stationary and flowing traffic must
like Greece, Ireland or Spain, the resulting crises could
be ever-increasingly transferred below ground, which also
only be cushioned by financial aid and extreme austerity.
leads to growth in specialist foundation engineering. More-
Greece narrowly avoided national bankruptcy in 2015
over, many buildings and infrastructural projects no longer
because it was no longer able to solve its problems by
involve new construction but are converted or expanded
its own efforts.
instead. The necessary preparatory earth-moving work is
greatly increasing, since unusual types of construction are
• The Russian-Ukrainian crisis unleashed a continuing
required and the work has to be done in very confined condi-
conflict in 2014, resulting in major worldwide economic
tions. We can therefore anticipate a basically favorable trend
consequences. Trade in goods and services with Russia
that is merely slowed down by the negative world events.
has declined significantly since then. The construction and
construction machine sectors have slumped even more.
The present trend is a mixture of positive and negative influen-
Even if efforts to find a political solution should achieve a
ces. A continuing positive factor is the worldwide need to
step-by-step rapprochement, it would take quite a few
catch up with an enormous backlog of infrastructure services,
years to repair the economic damage.
which is equally strong in developing countries and rising
economic states, but also in the established industrial nations.
• There are various reasons for the severe deterioration of
A tremendous catching-up process has begun in more than
oil prices. One of the causes is an over-supply resulting
half of the countries in the world during the past two decades.
from new production techniques such as fracking. Another
The general conditions for this are very favorable, since the
cause is the result of the conflicts in the Arab world. The
new possibilities of communication and mobility enable market
resource-rich countries seek to finance not only their conflicts
actors to pursue this catch-up race at increasingly low costs.
but also their extensive construction measures by selling
17
18
Business Report
ever-increasing volumes of oil and gas. This inevitably glutted
the refugee crisis imperil European stability, the European
the markets and consequently brought prices down. Few
economy could be endangered.
tangible economic consequences have so far emerged
because the countries involved are still relying on their
Nobody who seeks to weigh the positive and negative influ-
financial reserves to pursue their construction goals.
ences can predict what the total impact may be. However,
However, this cannot continue for much longer, so that
solid growth in the global economy can continue to be
particularly in the Arab world, major savings efforts and a
expected. For our company, this means that we must react
commensurate economic decline can be expected soon.
as flexibly as possible to these changes and seize the resulting
These problems also affect other countries which depend
opportunities. Our worldwide presence makes this quite
strongly on oil export revenues: Angola, Malaysia, Mexico,
possible.
Brazil and a number of others.
A GENERAL VIEW OF OUR MARKETS
• The many religious and political conflicts in the Middle
The construction markets continue to show good growth:
East are a major cause for concern. The outcome of
The construction sector in particular benefits from an enor-
the conflict with the Islamic State remains completely
mous need to catch up with backlogs in the rising economic
unresolved. Nobody can predict the future impact of this
countries, but also in the established industrial nations. Con-
today. The agreement with Iran on the use of nuclear
stantly increasing urbanization and growing infrastructural
energy is a welcome development. It opens up new
needs are leading to increasingly large-scale building schemes,
economic opportunities.
which offer many interesting project opportunities to the
construction industry. The amount of construction under-
• Due to the size of its economy, China has become a
taken in the economically established countries was clearly
main driver or – if a negative trend sets in – a brakeman
inadequate for many years. It is realized today that buildings
of the global economy. Its economic growth has currently
too must constantly be adapted to population needs and
slowed to little more than 6 %. Compared with the Chinese
economic requirements. This applies not only to traffic
construction sector and the associated construction equip-
infrastructure but also to residential and public buildings,
ment industry, this is still very high. The local construction
dams or flood protection facilities.
machinery industry contracted significantly in the past year.
Radical measures had to be taken to reduce its completely
Construction statistics Germany – Change 2015/2014
oversized production capacities. If this proves to be an
in %
Revenues
Order intake
Employees
7.1
13.3
---
example of other overheating symptoms, the Chinese
developments will cause world economic growth to
Residential construction
slow down even further in coming years.
Commercial construction
Public construction
• A few years ago, the BRIC states were still a synonym
for the upcoming economic nations. Very little of these
Total
0.3
1.1
---
-0.8
5.4
---
1.4
5.2
1.4
Source: Central Federation of the German Construction Industry
prospects remains evident today. China is heading towards
normality, India is crippling itself through its own bureau-
The companies of the BAUER Group can read the general
cracy, Russia is blocked by its conflicts and a major corrup-
trend from their very good order backlog, which is evenly
tion scandal is forcing Brazil to cope with a recession.
distributed over all regions of the world. Sales of construction
machinery are directly linked to the situation on construction
• A completely new problem which developed in Europe
during the second half of 2015 has no immediately negative
markets, so that favorable sales opportunities can be expected
in this sector too in coming years.
consequences for economic development, and could indeed
even bring it forward: the wave of refugees. But if goods
Besides the general trends, current developments and future
traffic is impeded by the closure of an increasing number
perspectives on construction markets in the various regions
of national frontiers, and if the political conflicts aroused by
around the world vary considerably:
Business Report
Germany
Geographical breakdown of total Group revenues
The German construction market will continue to see positive
in EUR million
growth over the coming years. Residential construction is being
Total 1,656
driven up primarily by low interest rates, but also by government subsidies. Public sector construction is benefiting from
Germany 474 (29 %)
a huge backlog of infrastructure work, for which administrative
Africa 77 (4 %)
budgets will now provide considerably increased funds. The
Americas 297 (18 %)
pace of commercial construction will depend on the development of the future outlook for the industry.
Germany especially has recognized the need to return to
more construction. The German federal government has
therefore considerably expanded the construction budget
for future years, which will help to increase building activity.
Asia-Pacific,
Far East & Australia
348 (21 %)
This situation is reinforced by the need generated by the
influx of refugees. The government is reacting here too by
releasing considerable additional funds.
Europe
Construction markets in Western Europe will remain relatively
restrained in coming years. This is largely due to the fact that
Europe (other)
71 (4 %)
Middle East & Central Asia
227 (14 %)
EU (excl. Germany)
162 (10 %)
the investment budgets of these countries remain low. However,
there are large infrastructure projects in some countries, such
Qatar and the United Arab Emirates. New subway lines,
as Switzerland or France with the Metro Ring in Paris. Other
railroad sections, stadiums and other large-scale projects
major cities are also planning to upgrade their infrastructure.
are in full swing. If oil prices remain low for much longer,
however, investments will decline and saving measures will
Smaller markets in Eastern Europe largely collapsed as a result
have to be introduced, which would affect the construction
of the financial crisis. There have recently been signs of a slight
industry as well. Construction companies must prepare for
upturn, though at a very low level.
this eventuality.
The crisis embroiling Russia and Ukraine continues to impose
The situation in Iraq and Syria remains extremely problem-
a serious burden on the development of both countries. Ukraine
atical. The armed conflict with the Islamic State has all but
is practically incapable of maintaining a construction sector
paralyzed economic development and specifically the con-
any longer – due to lack of funds. Although Russia is trying
struction sector. Neighboring states such as Jordan and
to continue funding its building sector, the financial deficits
Lebanon are also hampered by the situation, so that their
brought about by sanctions and the low oil price are forcing
economic development has significantly abated. In Libya,
the country to pursue a policy of extreme frugality. Commer-
last year was overshadowed by civil war. The opposing
cial construction has almost completely shut down. It can be
forces finally agreed to form a joint government, raising
assumed that Russia will suffer from the consequences of
at least some hope of stabilization.
the crisis for years to come. Equipment sales will therefore
also remain at a low level.
In Egypt, the government firmly established itself with the
backing of a strong military establishment. The country is
gripped by a regular building boom, which is boosting the
Very intensive construction is still taking place in the oil- and
economy. The Suez Canal was widened in record time and
gas-rich countries of the Middle East, such as Saudi Arabia,
is generating many other construction projects, since tunnels
19
20
Business Report
and harbors must be built in the vicinity. The Cairo subway is
however, these topical fields will regain prominence and
being expanded along with many other building works. It is
stimulate demand for construction accordingly.
not yet clear whether this development is sustainable.
These issues are opening up wide-ranging new opportunities
Asia-Pacific, Far East & Australia
for us too. In operation for several years now, our Resources
Construction markets in the Far East remain pleasingly stable.
segment is focused on matters relating to the environment,
Almost every country in the region is undertaking major
water and natural resources. We have already handled suc-
infrastructure projects. In Hong Kong, construction sector
cessful projects in some countries around the world and
capacities are being well utilized by extensive rail and road
expect demand for these services to grow considerably.
construction works. The prospect of the airport expansion
raises our hopes of major new projects in the years ahead.
COURSE OF BUSINESS
The same applies to Singapore and Malaysia. In Singapore
The BAUER Group achieved total Group revenues
for example, new subway lines and urban motorways are
amounting to EUR 1,656 million during the 2015 financial
being built. The port, one of the most important and biggest
year, a 6.2 % increase over the previous year’s value of EUR
in the world, is being relocated. Economies such as Indo-
1,560 million. The increase includes contributions from the
nesia and the Philippines are also seeing healthy growth.
divestment and revaluation of businesses amounting to EUR
By contrast, the Australian economy is no longer developing
77.8 million. If these and similar effects in the previous year
quite so positively. Construction activity has slowed down
(EUR 36.5 million) are disregarded, the increase amounted to
somewhat.
3.6 %. EBIT came to EUR 90.7 million (previous year: EUR
76.4 million). The net result for the period was EUR 29.0
Americas
million (previous year: EUR 15.7 million).
The USA’s economy is returning to its role as the driver of
global growth. A very high level of backlog demand has
In 2015, the BAUER Group was influenced by a number of
arisen in many infrastructure areas, due to a lack of ad-
problems with a major financial impact and by difficult market
equate building activities over recent decades. We are
conditions. On the other hand, we also achieved some pleasing
expecting major efforts over the coming years to make
successes. Overall, we could achieve our earnings after tax
good this deficit, providing a new boost to the economy
and EBIT largely only by means of non-operative profits. We
as a positive side effect. Overall, we regard the situation as
are pleased to state that the exceptional results considerably
stable and anticipate good opportunities for further growth
outstripped expectations. If these exceptional earnings had
in both our Construction and Equipment segments. The
not been included, we would not have reached the forecast
Canadian construction market is similarly firm. Interesting
of results given in the annual report for 2014. We had predicted
projects frequently crop up in Central America.
total Group revenues of about EUR 1.6 billion, earnings after
tax of about EUR 18 to 23 million and an EBIT of about EUR
Africa
75 million.
In Africa, active pursuit of new business is worthwhile even
if the overall economic level of these countries does not
Negative business influences were exerted mainly by our
permit a very great contribution to our total Group revenues.
construction subsidiary in the United States and many restruc-
Some countries have a very good chance to improve their
turing measures that primarily affected our Resources segment,
prosperity by virtue of their vast raw material resources.
but also the Equipment segment and SCHACHTBAU NORDHAUSEN GmbH. In addition, stagnant raw material markets
The current problems in the world have shifted such major
and low oil prices curbed the utilization of our drilling rigs in
issues of the future as the environment, demography and
Africa and those of our Jordanian subsidiary. Overall, these
energy into the background. As stabilization progresses,
influences considerably increased our financial expenditures.
Business Report
On the other hand, agreement on our joint venture with
Summary
Schlumberger, the world’s leading supplier of technology,
The many positive and negative special influences naturally
integrated project management and information solutions for
complicate consideration of the operative business consid-
oil and gas industry customers, enabled us to take a major
erably. Particularly in the segments, the key figures have
step forward in the field of deep drilling rigs. This joint venture
undergone very pronounced changes. On the whole, it
and the sale of shares of a subsidiary in the Equipment
remains to be said that the operational results lay within the
segment enabled us to secure the predicted annual result.
positive range when stripped of one-off effects identified by
Furthermore, the positive exceptional earnings enabled the
the company. All in all, the present and future outlook for the
Group to fund restructuring expenditures by loss-making
Group is therefore favorable.
subsidiaries.
However, we cannot be satisfied with our results for 2015.
The order backlog of the Group also developed extremely
We were only able to achieve a healthy, positive result due to
well and grew to EUR 995.6 million by the end of 2015, or
exceptional results. We expect the positive business trend to
30.5 % above the previous year’s figure of EUR 762.7 million.
continue because we managed even in difficult circumstances
Along with the Construction segment, which managed to
to increase total Group revenues. We will be able to build on
acquire several major projects, the order backlog was in-
that foundation in the financial year 2016.
creased by the largest order so far gained by the Group,
a project won by the Resources segment in Germany.
Development of total Group revenues by segment
Total 1,656
in EUR million (segments after deducting Other/Consolidation)
1,800
Resources
218
1,600
1,400
1,200
Equipment
705
1,000
800
600
Construction
international
551
400
200
Construction
Germany
182
0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
21
22
Business Report
CONSTRUCTION SEGMENT
in EUR ’000
2014 *
2015
Change
725,626
742,862
2.4 %
Sales revenues
646,628
650,762
0.6 %
Order intake
682,410
878,436
28.7 %
Order backlog
455,485
591,059
29.8 %
26,033
13,916
-46.5 %
2,524
-7,316
n/a
5,777
6,243
8.1 %
EBIT
General conditions
important contribution to the revenues of the segment in
Construction markets continued to develop positively in 2015,
Far Eastern markets in 2015, although the level of orders
allowing us to record good growth. This growth is additionally
has weakened somewhat in comparison to the extremely
propelled by the enormous need for infrastructural works such
good preceding years. The German construction market also
as roads, bridges, dams and energy supplies as well as in-
performed well on the whole during the previous financial year,
creasing urbanization. Since construction must be carried
which enabled us to repeat the high level of the preceding year.
out in increasingly complex, troublesome circumstances, the
The Austrian subsidiary boosted its revenues significantly with
need for specialist foundation engineering services is also
projects in its home market as well as with a major contract
expanding, so that we are acting here in a market with a
in Montenegro.
promising future.
By contrast, we recorded a weak trend and losses in Russia
The positive trend in the past year was bolstered by construc-
because local construction activities have been considerably
tion markets in the Middle and Far East as well as in the USA
reduced in the wake of sanctions and the decline of the ruble.
and Germany. The situation in European markets was highly
Our subsidiaries in Switzerland, England and the Netherlands
differentiated. In Russia, building activities were significantly
obtained fewer orders and consequently fell short of our
reduced in response to sanctions. However, we can look back
planned levels.
to a good overall market trend in 2015.
Our subsidiary in the USA was the determinant of the unsaSignificant events
tisfactory trend in results for the segment. The approval of
The Construction segment achieved total Group revenues
the major Center Hill Dam project was unexpectedly delayed
of EUR 742.9 million in the financial year 2015 with 2.4 % be-
by several months and as a result, as in the previous year,
yond the previous year’s level of EUR 725.6 million. EBIT fell
added additional considerable financial strains. The difficult
back by 46.5 % from EUR 26.0 million in the previous year
conditions surrounding the project led to considerable pro-
to EUR 13.9 million. The net result for the period was
blems in the further business activities and the organization
negative, declining to EUR -7.3 million after EUR 2.5 million
of the subsidiary. This necessitated restructuring measures
in the previous year.
to increase the subsidiary’s ability to compete in the American
market once more. These measures created additional
Particularly the Middle Eastern subsidiaries had a positive
significant financial burdens.
business year 2015. Revenues in Saudi Arabia, Qatar and
Egypt improved significantly. We are participating in major
At SCHACHTBAU NORDHAUSEN GmbH, which operates
subway construction sites in Doha, Riyadh and Cairo as well
mainly in Germany and performs services in all three business
as in projects relating to the Suez Canal. We achieved an
segments of the Group, several restructuring measures were
Business Report
taken in 2015 in response to business developments.
The environmental technology division, which is primarily
responsible for building biogas and sewage treatment
in EUR million (after deduction of Consolidation)
plants, was shut down as a result of changed political
Total 733
circumstances. The equipment division will be integrated
into the production network of BAUER Maschinen GmbH
Germany 182 (25 %)
in order to exploit synergy potentials.
Africa 47 (6 %)
Americas 113 (16 %)
Order situation
The order intake developed positively during the past
financial year to reach EUR 878.4 million at the end of the
year, 28.7 % above the previous year’s value of EUR 682.4
million. The order backlog rose to EUR 591.1 million, 29.8 %
above the previous year (EUR 455.5 million). We succeeded
in winning new orders in all regions of the world. Along with
Asia-Pacific,
191 (26 %)
many small and medium-sized building sites, we were again
able to add several major projects to our backlog. This includes
orders in Switzerland, England and Australia. In Canada, we
were commissioned to build a cut-off wall for the Diavik Mine
Europe (other)
30 (4 %)
with a value of around EUR 65 million. The project is already
under way and will continue until 2017. In a joint venture in
India, we won a contract with an order volume of about EUR
127 (17 %)
EU (excl. Germany) 43 (6 %)
60 million to build a diaphragm wall for the Polavaram Dam.
The work is scheduled for completion by the end of 2017.
If oil prices remain at a persistently low level, this will very
probably have a negative impact on construction markets in
Due to a record-level order backlog, we are entering the
the Arab world. Oil revenues have a determining influence on
current financial year on a very sound footing. It is gratifying
the investment budgets of many countries in that region. In
to find that further opportunities for orders exist around the
Russia, we anticipate little improvement during the current
world – they once more include a number of major projects,
year. In other world regions, we are assuming stable or even
such as in Hong Kong.
better developments than in the past year. With the completion
of the Center Hill Dam project last year, losses from the project
Outlook
will fall away and in future lead to noticeably improved overall
The overall performance of the world regions remains positive,
earnings.
despite all the existing political and economic disturbances.
Our worldwide presence enables us to exploit opportunities
We expect total Group revenues of the segment to end up
in markets with good business conditions and compensate
slightly above the previous year’s level in 2016. As far as EBIT
for weaker markets. Our worldwide order backlog has grown
is concerned, we are expecting a considerable improvement.
considerably in comparison to the previous year, since we
Furthermore, we are expecting good, positive earnings after
have once again acquired several major projects along with
tax.
smaller and medium-sized orders.
23
24
Business Report
EQUIPMENT SEGMENT
in EUR ’000
2014 *
2015
Change
639,151
753,083
17.8 %
Sales revenues
532,691
548,039
2.9 %
Order intake
676,801
649,108
-4.1 %
Order backlog
154,175
128,096
-16.9 %
35,952
99,441
n/a
8,847
65,397
n/a
2,936
2,919
-0.6 %
EBIT
General conditions
revaluation of our remaining 40 % stake in SPANTEC Spann-
Construction equipment markets showed widely disparate
und Ankertechnik GmbH. Another exceptional result arose
trends in 2015. Whereas demand increased in Europe and the
from the joint venture agreement with Schlumberger, the
USA – and even considerably in the Middle East – economic
world’s leading supplier of technology, integrated project
conditions in Russia, China, Africa and Latin America brought
management and information solutions for oil and gas industry
declines that were considerable in some cases.
customers. With a cash capital increase Schlumberger contributed 49 % to BAUER Deep Drilling GmbH, Germany, and
The competitive situation in the Chinese market changed
BAUER Manufacturing LLC, USA. In total, these transactions
greatly during the course of 2015. The exaggerated market
led to an exceptional result after tax amounting to EUR 71.6
expectations of local competitors created considerable surplus
million. The effect on revenues and the operating result
production capacities in past years. Consequently, a number
amounted to EUR 77.8 million, including a taxation effect
of these companies embarked on substantial capacity cut-
of EUR 6.2 million.
backs in the past year, especially in terms of personnel layoffs.
We therefore expect a market adjustment and a normalization
The exceptional earnings resulted from our efforts in recent
of the competitive situation in coming years.
years to develop specialized know-how for deep-drilling rigs
and from the very successful development of our business
The development of raw material prices also influenced our
with anchoring and tensioning technology. As SPANTEC
business. The considerable price declines reduced demand
Spann- und Ankertechnik GmbH gains the major part of
for well drilling rigs, which are also used for raw material explo-
its earnings from the sale of materials to our construction
ration. Sales of our deep drilling rigs were likewise affected by
industry competitors in Germany, surrendering the majority
the market situation.
shareholding to our partner was a necessary strategic step
to give the company more freedom of movement in future.
In this difficult market environment, we succeeded in raising
sales in combination with good operational earnings. Thanks
By contrast, the Equipment segment was burdened during
to our vigorous efforts regarding product quality, worldwide
the past year by restructuring costs as well as by losses from
service and offers of customer-specific solutions, we
the subsidiary which manufactures well drilling rigs, which
successfully asserted ourselves in the market and effectively
faced low demand in weak markets in the field of exploration.
compensated for sales declines in poor regions with other
The machinery plant in the USA remained underutilized as
areas.
well. Additional expenditures also arose in the course of
preparations for the joint venture, owing to legal costs as
Significant events
well as the need to prepare the two introduced subsidiaries
The key figures of the segment – and ultimately the entire
organizationally and financially. The positive exceptional
Group – are very strongly influenced by exceptional earnings.
earnings enabled further restructuring measures to be taken.
On the one hand was the sale of 50 % of the shares and the
Business Report
In the past financial year, total Group revenues in the
Equipment segment increased significantly by 17.8 %,
Equipment segment
from EUR 639.2 million to EUR 753.1 million. The increase
includes contributions from the divestment and revaluation
Total 705
of businesses amounting to EUR 77.8 million. If these are
subtracted, the increase amounts to 8.3 %. The sales
Germany 164 (23 %)
revenues grew by 2.9 % from EUR 532.7 million to EUR
Africa 20 (3 %)
548.0 million. EBIT rose considerably from EUR 36.0 million
Americas 172 (24 %)
to EUR 99.4 million. If the exceptional earnings of EUR 77.8
million for 2015 are subtracted, EBIT decreased by 40.0 %
to EUR 21.6 million. The net result for the period rose
significantly from EUR 8.8 million to EUR 65.4 million.
Disregarding the special influences on the key figures of the
segment identified by the company, it should be noted that
Asia-Pacific,
154 (22 %)
a slight increase in equipment sales was achieved in tandem
with good operational earnings. We regard this as a great
success in a difficult market environment.
The main contributions to this success came from the markets
Europe (other)
39 (6 %)
in the Middle East, Africa and the USA. We achieved good
sales in Europe as well. Our subsidiaries recorded particularly
60 (8 %)
good sales of anchor drilling rigs and rotary drives in the past
financial year. Our new machines, the duty-cycle crane series
sales situation, this resulted in a negative earnings contribution.
and the new developments in pile-driving technology estab-
In the course of consolidating the locations, the organization
lished themselves firmly in the market. The service and spare
and processes were adapted and the inventory of hired
parts business has continued to develop into an important
equipment was reduced. Equipment production in the plant
area of activity. The production and distribution organization
remains short of an adequate level.
in the Far East once more provided a good contribution to
the Group’s revenues and earnings. The construction equip-
The joint venture with Schlumberger in the field of deep
ment market in China itself shrank considerably, severely
drilling technology has now positioned this business with
burdening local competitors. We nevertheless managed to
positive future prospects and provides a stable base in
keep our sales stable. As a result, we effectively increased
this market, which is dependent on oil prices and therefore
our market share.
extremely cyclical. In the joint venture, large drilling rigs are
being developed and built for Schlumberger and third parties
On the other hand, the sanctions against Russia and the
for use in oil and gas drilling as well as geothermal boring.
plunging value of the ruble led to an almost complete collapse
Two drilling rigs have already been produced for Schlum-
of equipment sales here. Our commitment in Russia conse-
berger, and more rigs are planned to be built in 2016.
quently led to a significant loss. Sales trends in Central Asian
countries such as Azerbaijan and Kazakhstan were very weak.
Order situation
Project delays considerably reduced sales in South America.
Despite fluctuations during the year, the order intake was
almost exactly in line with the planned level at the end of the
In the USA, the production of specialist foundation engineering
year. The order backlog dropped to EUR 128.1 million,
equipment in Conroe and the sales company were combined
16.9 % below the previous year (EUR 154.2 million). The
in the BAUER-Pileco Inc. subsidiary. Independently of the good
deep drilling rig business was chiefly responsible for reducing
25
26
Business Report
the order backlog. Order intake decreased from EUR 676.8
business, while the normalization of market conditions can
million to EUR 649.1 million.
be expected to continue.
Customers for specialist foundation engineering equipment
We expect a likewise stable development of Middle Eastern
continue to order at relatively short notice. Only occasional
markets on the strength of the known projects. However, the
equipment orders for special projects are placed somewhat
low oil prices could trigger a decline in the course of 2016. We
longer ahead of time. This results in very swift deliveries to
see the Russian market remaining similarly weak as in 2015.
customers, so that the order backlog lasts between two and
three months throughout the year. Many machines were again
In our opinion, the removal of sanctions against Iran will offer
delivered at the end of 2015, so that the order backlog was
special opportunities for the equipment business. Through the
accordingly reduced in December.
joint venture with Schlumberger, we have gained a sound base
for the deep drilling business. It will additionally enable us to
In the area of deep drilling rigs, two rigs for Schlumberger were
improve the utilization of our plant in the USA, which market
included in the 2015 order backlog and were delivered at the
conditions for specialist foundation engineering equipment
beginning of 2016.
did not permit over the last years.
Outlook
For the year 2016, we expect total Group revenues of this
Economic and political concerns did not make 2015 an easy
segment to fall short of the level in 2015 because of the
year for the equipment business. We nevertheless register
absence of the previously described special influences. This
generally good demand from the overall growth of world
also applies to EBIT and earnings after tax. In the operational
construction markets. We see market conditions ranging
business, we expect slightly improved total Group revenues
from stable to positive in Europe, the USA, Africa and the Far
and markedly higher earnings figures, which points to positive
East. In China, we anticipate a stable development of our
earnings after tax.
RESOURCES SEGMENT
in EUR ’000
2014
2015
Change
252,830
221,609
-12.3 %
Sales revenues
195,860
179,319
-8.4 %
Order intake
219,306
345,045
57.3 %
Order backlog
153,027
276,463
80.7 %
EBIT
15,932
-19,807
n/a
4,347
-29,398
n/a
1,400
1,276
-8.9 %
General conditions
The market for deep drilling to exploit oil, gas, water and
The Resources segment focuses on the fields of water,
natural resources proved to be particularly difficult. Heavy
environment and natural resources. In the field of water,
pressure on raw material prices left hardly any projects for
we were able to register rising demand for brewing and
our companies. This situation burdened us considerably in
beverage technology as well as water purification plants in
the past year. Our subsidiaries in Jordan and South Africa
the past financial year.
were particularly affected.
Business Report
By contrast, the environmental business presented a very
positive picture. Germany is providing increased orders in
Resources segment
the field of remediation, such as land recycling, groundwater
treatment or the disposal of contaminated soils and surfaces.
Total 218
In the Middle East, our waste management offers enabled us
to gain new orders.
Germany 128 (59 %)
Africa 11 (5 %)
Significant events
Americas 12 (5 %)
Total Group revenues in the Resources segment decreased
Asia-Pacific,
2 (1 %)
by 12.3 % from EUR 252.8 million in the previous year to EUR
221.6 million. The previous year’s figure included revenues from
the disposal and revaluation of businesses to the value of
EUR 36.5 million, following the sale of a 21 % shareholding
40 (18 %)
in the Oman subsidiary. Subtracting these figures from the
previous year’s performance leaves an increase of 2.5 %.
EBIT decreased from EUR 15.9 million to EUR -19.8 million.
If the exceptional earnings are subtracted from the previous
year’s figure, a slight improvement of the EBIT remains. The
net result for the period was clearly negative at EUR -29.4
Europe (other)
2 (1 %)
million (previous year: EUR 4.3 million).
The Resources segment demanded a great deal of effort
from us in the past financial year. The reorganization of the
segment, which began in 2014 with its transformation into a
regional distribution unit, has already proved advantageous.
2013, the initiated restructuring was largely concluded in
A great deal of further restructuring was carried out in the
2015. Our drilling companies in Africa also gained hardly
past financial year to set up the segment in a strategically
any orders because of the market situation and therefore
new, future-oriented form. These influence factors and
reported losses.
measures created considerable financial burdens in 2015
and consequently led to a considerable loss.
A positive trend was shown above all by our subsidiaries in
the environmental and water businesses. BAUER Umwelt
The target of the restructuring was the GWE Group, which
GmbH in Germany outperformed our revenue expectations.
has stopped producing standard PE pipes and is now con-
The company scored a decisive success by winning an order
centrating on the well drilling and geothermal energy busi-
from Roche Pharma AG to remediate two sections of the old
nesses. This necessitated a consolidation of locations and
Kesslergrube landfill site in Grenzach-Wyhlen. The order
a workforce reduction. Other, smaller subsidiaries in the
amounts to more than EUR 100 million and is the largest
segment were shut down or are still being liquidated.
individual order yet gained by the BAUER Group. The shareholding in Oman also provided a positive earnings contribution
The greatest impact from the lack of deep drilling projects was
once more. The company primarily operates the large-scale
suffered by the Site Group for Services and Well Drilling Ltd.
reed-bed treatment plant to clean oil-contaminated water for
Co. in Jordan. The low raw material prices and the plight
the regional oil company.
of refugees in Jordan caused investments in this market
to collapse. The performance therefore slumped far below
The Resources segment also includes the mining division of
expectations and the burden imposed by idle drilling rigs
SCHACHTBAU NORDHAUSEN GmbH, which chiefly performs
produced a significantly negative result. After the loss in
restoration and safeguarding of mines. The continuing positive
27
28
Business Report
state of the market allowed revenues to remain at a healthy
The environmental business remains very positive, with a very
level. Along with many projects in Germany, an extensive order
good overall order situation and capacity utilization. The major
is being handled in Kazakhstan. The division made a good
Grenzach-Wyhlen project in Germany is expected to keep us
positive contribution to earnings.
busy until as late as 2020. The overall order situation in the
field of water is also good and offers us further opportunities
Order situation
for the future. All these matters will influence the current
The order intake with EUR 345.0 million in 2015 exceeded
financial year.
the previous year’s level of EUR 219.3 million considerably
by 57.3 %. The order backlog of EUR 276.5 million was
For 2016, we expect that total Group revenues will be consid-
accordingly higher than in the previous year (EUR 153.0
erably higher than in the previous year. EBIT should be in the
million) by 80.7 %. The main reason for the increase was the
positive area, whereas the current outlook for earnings after
previously mentioned major project in Germany. In addition,
tax is still negative.
the environmental business won a large order for waste
management from an oil company in Oman. The subsidiaries
OTHER / CONSOLIDATION SEGMENTS
which produce water purification plants and brewing and
The Other and Consolidation segments bundle the revenues
beverage technology systems also gained new orders and
and earnings of the Group which cannot be allocated to the
expanded the backlog with good contributions.
operating segments. The Other segment essentially comprises
the revenues of the parent company BAUER AG itself, gener-
Outlook
ated from a wide variety of administrative services provided
In the Resources segment, considerable efforts were again
to Group subsidiaries.
undertaken in the past financial year towards the reorganization
that was already initiated in 2014. Consistent work was devoted
The Other segment reports EBIT of EUR 4.6 million (previous
to cost structures, unprofitable businesses and subsidiaries
year: EUR 3.3 million). This includes EUR 4.0 million of dividend
were terminated and locations were abandoned or consoli-
payments by Group subsidiaries to the parent company. The
dated. The extensive restructuring measures created major
net result for the period was EUR 6.8 million (previous year:
financial burdens.
EUR 4.9 million). The segment’s revenues are especially
generated by intra-Group charges.
Raw material markets and prices unfortunately continued
their negative trends too, so that our drilling companies were
The Consolidation segment reflects the consolidation within
particularly affected by scarce orders. The market situation
the Group. The negative EBIT of EUR -7.4 million (previous
cannot be expected to improve quickly, even though there
year: EUR -4.8 million) largely matches the aforementioned
are many planned projects which continue to offer us
dividend payments by Group subsidiaries to BAUER AG. The
opportunities.
net result for the period was EUR -6.5 million (previous year:
EUR -4.9 million).
Business Report
Breakdown of total Group revenues by subsegment
in EUR million
2014
Revenues *
2015
Revenues
Share
Year 2015
125.6
7.7 %
Change against
previous year
Orders
in hand
BAUER Spezialtiefbau GmbH (BST)
Construction
BST, Germany
Equipment
+
16.7
22.8
1.4 %
36.5 %
+
BST, international
98.9
110.7
6.7 %
11.9 %
•
502.5
543.0
32.8 %
8.1 %
+
751.3
802.1
48.4 %
6.8 %
+
-18.7 %
•
Subsidiaries, international
BST Group total
78.7
64.0
3.9 %
-104.4
-123.2
-7.4 %
Construction total
725.6
742.9
44.9 %
2.4 %
+
BAUER Maschinen GmbH (BMA)
383.3
465.5
28.1 %
21.4 %
•
Equipment subsidiaries
468.7
534.4
32.3 %
14.0 %
•
BMA Group total
852.0
999.9
60.4 %
17.4 %
•
49.4
45.7
2.8 %
-7.5 %
•
-262.2
-292.5
-17.7 %
639.2
753.1
45.5 %
17.8 %
•
less intra-Group revenues and IFRS adjustments
SBN
Equipment total
BAUER Resources GmbH (BRE)
Resources
-5.7 %
Subsidiaries, Germany
SCHACHTBAU NORDHAUSEN GmbH Subsidiaries (SBN)
Other
133.2
29.5
17.4
1.1 %
-41.0 %
++
Resources subsidiaries
231.1
196.8
11.9 %
-14.8 %
•
BRE Group total
260.6
214.2
12.9 %
-17.8 %
+
33.9
37.2
2.2 %
9.7 %
•
+
SBN
-41.7
-29.8
-1.8 %
Resources total
252.8
221.6
13.4 %
-12.3 %
37.1
38.9
2.3 %
4.9 %
BAUER Aktiengesellschaft (BAG)
Other subsidiaries
Total Other/services
Group total (including non-controlling interests)
of which: Germany
International
2.3
2.6
0.2 %
13.0 %
39.4
41.5
2.5 %
5.3 %
-96.8
-102.7
-6.2 %
1,560.2
1,656.4
100.0 %
440.2
473.7
28.6 %
7.6 %
1,120.0
1,182.7
71.4 %
5.6 %
Notes on the table:
List also includes non-consolidated holdings
Evaluation of orders in hand in relation to planned revenues:
-- weak; - slightly weak; • adequate; + well adequate; ++ very well adequate;
Percentages and totals are calculated on the basis of unrounded starting values
6.2 %
+
Breakdown Germany/international according to country in
which accounting figures were allocated. For reasons of
complexity the figures are not absolutely precise.
29
30
Business Report
Breakdown of total Group revenues across the companies of the BAUER Group
Shareholdings < 50 % are listed with their revenue share
in EUR million
2014 *
2015
232.1
236.3
14.5
19.9
BAUER Spezialtiefbau GmbH - Group
BAUER Spezialtiefbau GmbH, Schrobenhausen, Germany (BST)
Wöhr + Bauer GmbH, Munich, Germany (33 % share) – (sub-group consolidated financial statements)
BAUER Funderingstechniek B.V., Mijdrecht, Netherlands
4.7
4.6
BAUER Technologies Limited, Bishops Stortford, Great Britain
2.6
10.3
BAUER Spezialtiefbau Schweiz AG, Baden-Dättwil, Switzerland
BAUER Magyarország Speciális Mélyépítö Kft., Budapest, Hungary
28.6
9.2
7.7
9.7
BAUER ROMANIA S.R.L., Bucarest, Rumania
2.1
1.3
BAUER BULGARIA EOOD, Sofia, Bulgaria
4.5
3.9
BAUER SPEZIALTIEFBAU Gesellschaft m.b.H., Vienna, Austria
14.4
22.7
OOO BAUER Technologie, Moscow, Russian Federation
31.3
9.8
BAUER EGYPT S.A.E. Specialised Foundation Contractors, Cairo, Egypt
22.9
37.4
BAUER LEBANON FOUNDATION SPECIALIST S.a.r.l., Beirut, Lebanon
16.5
12.5
BAUER Georgia Foundation Specialists LCC, Batumi, Georgia
3.3
4.3
BAUER International FZE, Dubai, United Arab Emirates
37.0
34.8
BAUER Geotechnical Specialized Foundation LLC, Abu Dhabi, United Arab Emirates
20.7
34.0
BAUER International Qatar LLC, Doha, Qatar
13.8
34.5
Saudi BAUER Foundation Contractors Ltd., Jeddah, Saudi Arabia
10.8
24.0
BAUER (MALAYSIA) SDN. BHD., Petaling Jaya, Malaysia - (sub-group consolidated financial statements)
84.7
76.9
BAUER Hong Kong Limited, Hong Kong, People’s Republic of China
45.3
28.2
BAUER Vietnam Ltd., Ho Chi Minh City, Vietnam
BAUER Foundations Philippines, Inc., Quezon City, Philippines
2.9
6.0
10.2
22.8
P.T. BAUER Pratama Indonesia, Jakarta, Indonesia
30.2
12.7
Thai BAUER Co. Ltd., Bangkok, Thailand
21.2
18.1
6.7
5.8
42.2
55.3
BAUER Foundation Australia Pty Ltd., Brisbane, Australia
BAUER FOUNDATION CORP., Odessa, United States of America
BAUER Foundations Canada Inc., Calgary, Canada
BAUER FUNDACIONES PANAMÁ S.A., Panama City, Panama
BAUER FUNDACIONES DOMINICANA, S.R.L, Santo Domingo, Dominican Republic
Other BST shareholdings
Joint ventures, Germany - (BST share only)
9.1
26.3
11.7
10.5
2.0
7.5
15.6
20.1
2.0
2.7
Intra-Group sales
-93.9
-111.3
BST Group total
657.4
690.8
107.3
82.8
33.8
41.8
SCHACHTBAU NORDHAUSEN GmbH - Group
SCHACHTBAU NORDHAUSEN GmbH, Nordhausen, Germany (SBN)
SBN participations
Joint ventures SCHACHTBAU NORDHAUSEN GmbH - (SBN share only)
SPESA Spezialbau und Sanierung GmbH, Schrobenhausen, Germany
Joint ventures SPESA - (SPESA share only)
0.0
1.9
14.2
17.3
6.7
3.1
Intra-Group sales
-59.0
-57.4
SBN Group total
103.0
89.5
BAUER Maschinen GmbH - Group
BAUER Maschinen GmbH, Schrobenhausen, Germany (BMA)
383.3
465.5
KLEMM Bohrtechnik GmbH, Drolshagen, Germany
42.9
46.5
EURODRILL GmbH, Drolshagen, Germany
12.4
13.0
RTG Rammtechnik GmbH, Schrobenhausen, Germany
26.4
33.9
MAT Mischanlagentechnik GmbH, Immenstadt, Germany
11.8
-
PRAKLA Bohrtechnik GmbH, Peine, Germany
13.0
6.3
Compared to the breakdown of total Group revenues by segment, in the breakdown of total Group revenues by company the total of the individual groups is shown
after consolidation.
Business Report
in EUR million
2014 *
2015
BAUER Maschinen GmbH - Group
Olbersdorfer Guß GmbH, Olbersdorf, Germany
SPANTEC Spann- & Ankertechnik GmbH, Schrobenhausen, Germany
BAUER Deep Drilling GmbH, Schrobenhausen, Germany
TracMec Srl, Mordano, Italy
BAUER EQUIPMENT UK LIMITED Rotherham, Great Britain
7.9
7.0
21.5
16.6
1.3
31.3
11.4
13.0
7.4
11.5
13.1
7.2
OOO BAUER Maschinen Russland, Moscow, Russian Federation
7.8
6.0
OOO BAUER Maschinen - Kurgan, Kurgan, Russian Federation
5.6
5.2
OOO BG-TOOLS-MSI, Lyubertsy, Russian Federation
1.6
1.6
BAUER Equipment Gulf FZE, Dubai, United Arab Emirates
8.4
9.9
BAUER Casings Makina Sanayi ve Ticaret Limited Sirketi, Ankara, Turkey
3.9
4.4
BAUER-DE WET EQUIPMENT (PROPRIETARY) LIMITED, Rasesa, Botswana
2.1
0.6
152.9
135.2
BAUER Macchine Italia Srl, Mordano, Italy
BAUER Technologies Far East Pte. Ltd., Singapore, Singapore - (sub-group consolidated financial statements)
NIPPON BAUER Y.K., Tokyo, Japan
7.3
5.9
BAUER Equipment Australia Pty. Ltd., Baulkham Hills, Australia
6.4
9.5
76.3
98.0
-
45.0
22.2
16.9
BAUER-Pileco Inc., Conroe, Texas, United States of America
BAUER Machinery USA Inc., Conroe, United States of America
BAUER Manufacturing Inc., Conroe, United States of America
Other BMA participations
5.1
9.9
Intra-Group sales
-220.5
-251.7
BMA Group total
631.5
748.2
BAUER Resources GmbH - Group
BAUER Resources GmbH, Schrobenhausen, Germany (BRE)
29.6
17.4
GWE pumpenboese GmbH, Peine, Germany
56.0
49.1
BAUER Umwelt GmbH, Schrobenhausen, Germany (BMU)
54.8
56.6
BAUER Water GmbH, Oberndorf a.N., Germany
13.5
11.2
Esau & Hueber GmbH, Schrobenhausen, Germany
15.4
15.4
BAUER Foralith GmbH, Schrobenhausen, Germany
5.1
0.5
GWE POL-Bud Sp.z.o.o, Lodz, Poland
3.1
3.4
FORALITH Drilling Support AG, St. Gallen, Switzerland
5.1
2.1
BAUER Ambiente S.r.l., Milan, Italy
1.4
0.6
GWE Budafilter Kft., Mezöfalva, Hungary
3.2
3.5
BAUER Resources GmbH / Jordan Ltd. Co., Amman, Jordan - (sub-group consolidated financial statements)
29.9
22.7
BAUER Nimr LLC, Maskat-Al Mina, Sultanate of Oman
17.4
7.4
4.8
4.2
BAUER Emirates Environment Technologies & Services LLC, Abu Dhabi, United Arab Emirates
BAUER Technologies South Africa (PTY) Ltd., Cape Town, South Africa (sub-group consolidated financial statements)
2.4
3.0
BAUER RESOURCES GHANA LIMITED, Accra, Ghana
2.5
0.8
BAUER Senegal SARL, Dakar, Senegal
0.0
2.5
GWE Tubomin S.A., City of Santiago, Chile
3.3
4.3
BAUER Resources Canada Ltd., Edmonton, Canada - (sub-group financial statements)
1.2
0.1
Other participations of BRE
7.3
7.0
Joint ventures BAUER Umwelt GmbH - (BMU share only)
4.6
2.4
Intra-Group sales
-34.9
-25.1
BRE Group total
225.7
189.1
37.1
38.9
2.3
2.6
BAUER Aktiengesellschaft, Schrobenhausen, Germany (BAG)
Other participations of BAG
Intra-Group sales
-96.8
-102.7
GROUP TOTAL
1,560.2
1,656.4
31
32
Earnings, financial and net asset position
III. EARNINGS, FINANCIAL AND NET ASSET POSITION
GROUP EARNINGS POSITION
will not be able to achieve these returns entirely in the coming
The Group earnings position in 2015 was significantly influ-
year, because similar special effects are not to be expected.
enced by contradictory developments. The purely operating
result without restructuring expenditures and negative excep-
There have been noticeable changes to individual income
tional effects identified by the company was positive, although
statement items. This is chiefly a result of the special influences
significantly below the forecast made for the business year.
described above which are included in the past two business
Many restructuring activities that were necessary in various
years.
areas led to significant expenditure, and thus a considerable,
negative contribution to earnings. In addition, there were
The individual income statement items are summarized in the
special losses such as in the USA or in Jordan because of
following.
missing drilling orders. On the other hand, the sale of 50 %
of the shares in SPANTEC Spann- und Ankertechnik GmbH
Consolidated revenues rose by 5.4 % against the previous
and the joint venture with Schlumberger in the deep drilling rig
year (EUR 1,506.0 million) to EUR 1,587.9 million. Without the
business made it possible to achieve significant special results
described special effects in the previous year and the reporting
(at EBIT level) amounting to EUR 77.8 million overall.
year, the increase would have been 2.8 %.
All these effects led to a net result for the period of EUR
Sales revenues were up slightly by 0.2 % compared to the
29.0 million (previous year: EUR 15.7 million).
previous year (EUR 1,375.7 million) at EUR 1,379.0 million.
Comparing the earnings figures with the previous year indicates
Changes in inventories increased by 8.9 % from EUR 26.6
that 2014 includes an income item from sale and consolidation
million to EUR 29.0 million.
amounting to EUR 36.5 million resulting from the sale of 21 %
of the shares in our subsidiary BAUER Nimr LLC in Oman.
Other capitalized goods and services for own account
increased by 54.8 % from EUR 14.7 million to EUR 22.7 million
EBIT increased from EUR 76.4 million to EUR 90.7 million.
due to higher investments in equipment from own production
EBITDA increased by 8.2 % from EUR 171.0 million to EUR
in 2015.
185.1 million, representing 11.7 % (previous year: 11.4 %) of
Other income rose very significantly against the previous
consolidated revenues.
year, from EUR 89.0 million to EUR 157.2 million. The special
The pre-tax return on equity as the ratio of pre-tax profit to
earnings already described provided a further significant
shareholders’ equity (equity at the start of the period) improved
boost for this item in 2014 (Oman) and in the completed
significantly against the previous year from 9.0 % to 13.5 % –
business year (joint venture and Spantec). Moreover, the
in particular due to the special effects. The return on equity
book profits on asset disposal (EUR 16.4 million) rose by
after tax was 6.9 % (previous year: 3.7 %). The return on
EUR 11.0 million. Other key changes to this item related
sales after tax (relative to the consolidated income statement
to realized and unrealized foreign currency gains as well as
revenues) improved from 1.0 % to 1.8 % year-on-year. We
gains from foreign exchange forward contracts, which overall
Trend in total Group revenues by quarter
in EUR million
Q1 2015
Q2 2015
Q3 2015
Q4 2015
Full year 2015
BAUER Group
409.101
371.258
414.498
461.555
1,656.412
Construction
193.470
176.437
194.519
178.436
742.862
Equipment
173.821
159.565
163.205
256.492
753.083
Resources
54.251
47.830
75.118
44.410
221.609
-12.441
-12.574
-18.344
-17.783
-61.142
Other/Consolidation
increased by EUR 16.2 million to EUR 50.8 million compared
Write-downs of inventories due to use reflect the use
to the previous year. Realized and unrealized foreign currency
of rental equipment made available to our customers. This
gains and losses as well as gains and losses from foreign
equipment does not form part of the fixed assets, but is
exchange forward contracts result from our currency hedge
recognized under inventories. The reason for this approach
management activities. Fluctuations in hedged and unhedged
is that most of this equipment remains within the company
currencies can cause the corresponding income statement
only for a relatively short time. The aim of the rental operation
items to vary widely over the years depending on trends. The
is to subsequently sell the equipment under a rental-purchase
unbalanced statement of exchange rate shifts results from
agreement. As the equipment has to be financed correspond-
the situation that exchange rate hedging cannot always be
ingly on the Equity and Liabilities side of the balance sheet,
set exactly against the underlying transactions, even though
its depreciation forms part of the company’s EBITDA. As
in operational reality they are aligned as closely as possible
a consequence of the changes in the market following the
to each other. The Group’s objective is to undertake exchange
financial crisis, our customers are increasingly entering into
rate hedging which rules out the possibility of foreign curren-
these rental transactions. The write-downs due to use
cy gains or losses as far as possible. The countering item in
decreased by 16.4 % to EUR 13.2 million during the year
an amount of EUR 58.5 million (realized and unrealized foreign
under review.
currency losses and losses from foreign exchange forward
contracts) is entered under “Other operating expenses”. The
Other operating expenses rose by 19.0 % from EUR
difference between the gains and losses shows that we experi-
230.5 million to EUR 274.2 million. The many individual
enced overall foreign currency losses of EUR 7.7 million in the
components of this item develop in very different ways
year under review. The significant exchange rate fluctuations
depending on the course of business and the mix of the
during 2015 – with considerable positive and negative effects
order portfolio. This item includes the realized and unrealized
depending on the currency – were the cause of these earnings.
foreign currency losses described under “Other income”,
which contributed significantly to an increase in the item
Cost of materials increased by 0.4 % to EUR 752.5 million
at EUR 29.3 million. Without the cost changes caused
in the year under review. Costs of materials on projects in the
by exchange rate fluctuations, the rise in other operating
Construction segment vary widely, so comparisons between
expenses would have been 6.2 %.
individual years are only possible to a very limited extent.
Financial income declined from EUR 7.1 million to EUR 5.0
Personnel expenses increased by 5.9 % to EUR 376.1
million. Financial expenses declined from EUR 45.1 million to
million – a higher rate than the consolidated revenues. The
EUR 42.0 million. Overall, this results in a decrease in the
rise is largely explained by higher personnel expenses in our
financial result, which is to be explained by the better interest
major projects and social plan expenditure as a result of
conditions.
restructuring measures.
The share of the profit or loss of associated companies
Depreciation of fixed assets increased slightly by 3.0 % to
accounted for using the equity method totaling EUR 2.7
EUR 81.1 million. This is chiefly due to the higher number of
million was EUR 3.2 million above the previous year. The
equipment in the Construction segment.
EBIT trend by quarter
in EUR million
BAUER Group
Construction
Q1 2015
Q2 2015
Q3 2015
Q4 2015
Full year 2015
1.233
14.758
20.390
54.342
90.723
4.861
5.536
1.997
1.522
13.916
Equipment
-0.887
9.313
16.159
74.856
99.441
Resources
-2.918
-0.298
2.033
-18.624
-19.807
0.177
0.207
0.201
-3.412
-2.827
Other/Consolidation
33
34
significant positive contribution to results is due to the partici-
extent. The reasons for the considerable rise over recent
pation in Oman.
years following the financial crisis are detailed below:
Income tax expense of EUR 27.4 million was EUR 5.3 million
The level of the net debt in the Group is largely dependent
above the previous year’s level. This item includes EUR 6.2
on the level of the working capital. The working capital of
million of deferred tax expense on valuations in connection
our businesses is inevitably relatively high due to the nature
with the foundation of the joint venture with Schlumberger.
of our business model and the special market in which we
Negative result contributions from subsidiaries in individual
operate. Our construction projects run for only comparatively
countries only have the effect of reducing the tax burden on
short periods of time. As opposed to building construction
the Group if it is possible to establish deferred tax assets on
contractors, who work on longer-running projects, we only
the basis of positive tax-related earnings planning. In some
sometimes receive advance payments for the construction
cases, this was not possible last year. In future, we expect
project in question meaning that it is very rare for us to
an income tax burden of between 30 % and 40 %.
generate a positive cash flow over the term of the project.
Short-running construction contracts – such as we mostly
The result attributable to non-controlling interests was
carry out – require financing across the Group’s many con-
EUR -0.7 million (previous year: EUR 1.2 million).
struction sites corresponding to roughly three months’ sales
of the Construction segment. Consequently, settlement always
The result attributable to BAUER AG shareholders was
takes place after the activity has been carried out.
EUR 29.7 million (previous year: EUR 14.5 million).
The situation in the Equipment segment is similar. Production
GROUP FINANCIAL AND NET ASSET POSITION
lead times for our specialist machinery are around 12 months.
With consolidated revenues up 5.4 % on the previous year, the
Since customers usually only order equipment once they have
Group’s net assets increased by 5.2 % from EUR 1,575.1
an actual contract to fulfill, and so expect short delivery lead
million to EUR 1,656.9 million. The equity ratio of 27.2 % was
times from us, we are forced to hold stocks of finished
well up on the previous year (26.6 %). The loss in 2013 meant
machinery. Moreover, we have a very broad product range
that the equity ratio fell below 30 %. We are once again aiming
and we need to stock spare parts for our customers world-
to achieve a value in excess of 30 % in coming years. All
wide, leading to a corresponding increase in the need for
investment and growth plans of the business are aligned
financing.
to this target.
Nevertheless, we judge that the working capital of the BAUER
The net debt of our business increased again by 3.0 % in
Group is currently too high in relation to our business volumes.
the year under review after a decrease in the previous year.
Our levels of inventories, finished goods and receivables have
In the coming years, we will continue to work intensively on
increased beyond the normal bounds. This is not good, but
reducing net debt in relation to net assets. We must stress,
on the other hand is explainable, because we are aware of
however, that in view of the nature of our business and the
the reasons why it is so: they reflect market trends as well
current economic climate, that is only possible to a certain
as special effects. Furthermore, substantial amounts are
Exchange rate trend 2015
1 EUR corresponds to
Average rate
2014
Q1 2015
Q2 2015
Q3 2015
Q4 2015
Average rate
2015
USD
1.3219
1.0740
1.1141
1.1165
1.0892
1.1039
GBP
0.8028
0.7234
0.7084
0.7371
0.7350
0.7236
RUB
51.5000
62.4155
62.3326
73.2499
80.4168
68.6566
CNY
8.1575
6.6572
6.9100
7.0967
7.0724
6.9434
imposing a burden, as claims in respect of supplementary
turing operations). Some specific items relate primarily to the
work on completed international construction projects are
Construction element, while others, in contrast, relate to the
having to be asserted by legal action. Even though the
Equipment element. The main items of such kinds are listed
amounts are recognized with due commercial caution in the
in the following:
accounts, they are nevertheless imposing a burden in terms
of the indebtedness of the business.
• Within property, plant and equipment, about two thirds
of the land, land rights and buildings item relates to the
We are aware that the Group’s higher financing requirements
Equipment segment. On the other hand, about two thirds of
place greater weight on the question of our self-financing
the technical equipment and machinery item is attributable
capabilities. Following the loss made in 2013, the equity ratio
to the Construction segment.
has fallen too low, so it will have to be increased again in the
years ahead. It would be much higher if the hidden reserves
• Some 40 % of the raw materials and supplies item is
were included. Since changing over to IFRS we have used
linked to the machinery manufacturing operations of the
the historical cost model to value land and buildings. With
Equipment segment.
a carrying amount for the land and buildings of EUR 184.2
million, there is a considerable reserve here.
• More than 90 % of the work in progress and finished
goods and stock for trade item relates to the Equipment
The net debt to EBITDA and EBITDA to net interest coverage
segment, with a small percentage attributable to the Con-
ratios agreed with lenders as covenants have worsened since
struction and Resources segments. In the Equipment
the financial crisis, and especially as a result of the loss made
segment, it is essential to successful selling operations
in the 2013 financial year. In 2015, it was possible to move the
to maintain stocks of rental equipment as part of current
net debt to EBITDA ratio to a somewhat better level at 3.59,
assets, so that customers can try out the machinery before
representing an improvement compared to the previous year
making their final purchasing decision. Equipment can also
(3.78). The two other agreed covenant ratios – EBITDA to net
be drawn from the pool to cover short-term capacity
interest coverage and equity ratio – are adequately within the
bottlenecks on construction sites. The machinery in
agreed thresholds. The Group has entered into covenants in
production at the balance sheet date also represents
respect of a number of long-term loans, which were valued
a very substantial capital tie-up.
as per the 2015 year-end at EUR 193.5 million. The covenants
on them stipulate net debt to EBITDA ratio thresholds between
3.75 and 5.0.
• Receivables from construction contracts (PoC) are
attributable to the Construction and Resources segments.
The trade receivables item is broken down according to
the respective segments’ shares of total Group revenues.
Covenants trend
2014
2015
Net debt/EBITDA
3.78
3.59
These different weightings are barely relevant to inter-period
EBITDA/net interest coverage
4.49
4.99
balance sheet comparisons when the rate of growth – either
Equity ratio in %
26.6
27.2
positive or negative – of the business areas is roughly the same.
The syndicated loan agreed in 2014 amounting to EUR 450
With regard to the items on the balance sheet, the following
million, to which the named thresholds also apply, will still run
material changes should be noted:
until April 2017. We will carry out the refinancing process in
the current year.
On the Assets side:
• Intangible assets declined by EUR 7.0 million. The
In assessing the Assets side of the consolidated balance sheet,
main reduction concerns development costs which were
it is important to note that this is composed of a Construction
transferred to the joint venture with Schlumberger. The
element (relating to the Construction and Resources segments)
corresponding development costs for large deep drilling
and an Equipment element (relating to machinery manufac-
rigs are thus no longer in the basis of consolidation.
35
36
Assets
Equity and liabilities
Equity
Non-current assets
EUR 451.2 million (27.2 %)
EUR 618.2 million (37.3 %)
(2014: EUR 418.9 million (26.6 %))
(2014: EUR 594.8 million (37.8 %))
Non-current debt
Current assets
EUR 533.9 million (32.2 %)
EUR 991.3 million (59.8 %)
(2014: EUR 523.3 million (33.2 %))
(2014: EUR 938.5 million (59.6 %))
Current debt
Liquid funds
EUR 671.8 million (40.6 %)
EUR 47.4 million (2.9 %)
(2014: EUR 632.9 million (40.2 %))
(2014: EUR 41.8 million (2.6 %))
EUR 1,656.9 million
• Land, land rights and buildings declined by EUR 22.3
EUR 1,656.9 million
• Receivables from construction contracts (PoC) de-
million to EUR 184.2 million. The main influencing factor
creased by EUR 2.7 million to EUR 129.5 million. Changes
was the incorporation of BAUER Manufacturing LLC, USA,
in this item result from the percentage of completion of our
and thus the plant in Conroe, into the joint venture. Other-
projects at the year-end closing date.
wise, only relatively small building projects were undertaken
during the financial year or smaller buildings sold.
• Trade receivables increased by EUR 32.5 million to EUR
343.9 million.
• Technical equipment and machinery decreased by
EUR 18.9 million to EUR 187.3 million. The reduction is
• Other current financial assets increased by EUR 8.8
largely due to disinvestments in Jordan. Basically, the shift
million to EUR 28.9 million. The main reason is the reas-
in demand on international construction markets means
signment of a receivable from other non-current financial
that our construction works require increasingly large
assets.
machinery and equipment. Consequently, small equipment
is increasingly being replaced by much larger machinery,
leading to a general increase in fixed assets.
• Cash and cash equivalents increased by EUR 5.6 million
to EUR 47.4 million. Attempts are made to minimize this
figure at the year-end by appropriate liquidity management.
Property, plant and equipment and investment property
were reduced overall by EUR 42.6 million to EUR 404.0 million.
On the Equity and Liabilities side:
• Equity increased significantly by EUR 32.3 million to EUR
• Investments accounted for using the equity method
451.2 million. Factors contributing positively to this change
increased by EUR 89.6 million to EUR 132.6 million. In this
were the net result for the period (EUR 29.0 million), currency
case, the companies included in the joint venture with
fluctuations (EUR 7.8 million) and the interest-related
Schlumberger were accounted for at the equity method as
adaptation in provisions for pensions netted against the
well as our residual share amounting to 40 % in SPANTEC
associated deferred tax assets (EUR 4.7 million). Changes
Spann- und Ankertechnik GmbH both totaling up to EUR
in the basis of consolidation (EUR 4.3 million) and dividend
90.9 million. The corresponding market values were derived
payments (EUR 3.1 million) had a reducing effect.
from the capital inpayments and purchase prices of our
particular partners.
• Non-controlling interests decreased by EUR 7.2 million
• Owing to the effects set out under “Group earnings posi-
to EUR 12.4 million. The main factors were the changes
tion”, earnings before tax of EUR 56.4 million were made
caused by the sale of shares in SPANTEC Spann- und
compared to earnings of EUR 37.8 million in the previous
Ankertechnik GmbH and a reassignment to the majority
year.
capital concerning the Site Group for Services and Well
Drilling Ltd. Co.
• Depreciation of fixed assets increased slightly by EUR 2.4
million, and contributed EUR 81.1 million to the inflow of
• The non-current portion of liabilities to banks increased
funds from ongoing business activity.
from EUR 364.8 million to EUR 376.6 million.
• The other non-cash transactions and results of deconsoli• Long-term provisions for pensions decreased by EUR
4.1 million to EUR 112.3 million. The reduction is largely due
dations contain effects from deconsolidations amounting
to EUR 77.9 million (previous year: EUR 36.5 million).
to the return to an increase in the discount rate at 2.35 %
(previous year: 2.0 %). The annual injection from ongoing
pension commitments counteracted this reduction.
• Other non-current financial liabilities decreased from
EUR 10.0 million to EUR 4.4 million.
• The current portion of liabilities to banks increased
from EUR 266.5 million to EUR 297.7 million. Financing
• The increase in trade receivables resulted in a capital tie-up
of EUR 38.8 million.
• The increase in inventories burdened the operating cash
flow to the tune of EUR 38,0 million.
• The other current and non-current liabilities changed by
EUR -34.8 million compared to the previous year.
increased by EUR 43.0 million overall in terms of current
and non-current liabilities to banks.
Cash flow from investment activities totaled EUR -37.5
million, decreasing by EUR 10.0 million below the previous
• Trade payables increased by EUR 16.0 million to EUR
185.0 million. When it is sensible to do so, we use all
year’s figure, especially due to higher proceeds from the sale
of fixed assets.
discounting opportunities.
The outflow of funds from financing activities was EUR 9.1
• Other current financial liabilities decreased by EUR
million. The main factors influencing this were repayments
13.6 million to EUR 12.1 million. This is largely due to
of loans and liabilities to banks amounting to EUR 159.2
liabilities from foreign exchange forward contracts.
million and interest payments of EUR 38.6 as well as new
indebtedness to banks in the amount of EUR 213.4 million.
The ratio of net assets to consolidated revenues decreased
slightly from 104.6 % to 104.3 %.
Net cash from operating activities shown in the cash flow
statement decreased substantially from EUR 115.4 million
to EUR 32.4 million. The following factors contributed to this
change:
37
38
ZUSAMMENGEFASSTER LAGEBERICHT
Einzelabschluss BAUER Aktiengesellschaft
Financial Statements of BAUER Aktiengesellschaft
IV. FINANCIAL STATEMENTS OF BAUER AKTIENGESELLSCHAFT
The annual report combines the Group management report
• Other operating expenses rose by EUR 31.0 million. The
and the management report of BAUER AG as the parent
main reasons for this significant rise are the payments by
company. The balance sheet and the income statement of
BAUER AG for the restructuring measures in the subsidiaries
BAUER AG (according to the German Commercial Code,
of BAUER Resources GmbH.
HGB) will thus be explained at this point.
• The operating result deteriorated by EUR 30.9 million to
BAUER AG posted a significant loss in 2015, amounting to
EUR -31.1 million.
EUR 25.2 million. Extensive restructuring measures in the
Resources segment obliged BAUER AG to undertake share-
• The net result for the year with EUR -25.2 million is EUR
holder contributions to subsidiaries amounting to EUR 29.7
31.1 million below the previous year. The unappropriated
million. This measure was taken in order to safeguard the
net profit decreased significantly from EUR 33.3 million to
future business of the segment, and was thus unavoidable.
EUR 5.6 million.
Furthermore, BAUER AG was burdened by a high injection
into provisions for pensions (EUR 1.6 million). A dividend
The payment of dividends to shareholders is based on the
payment by BAUER Maschinen GmbH (EUR 4.0 million) and
unappropriated net profit of BAUER AG as the parent com-
its own positive contributions to results made it possible to
pany, taking into account the Group’s consolidated earnings.
reduce the loss to EUR 25.2 million.
The dividend policy of BAUER AG is one of continuity, meaning that in principle a dividend should be paid even in difficult
The following items in the balance sheet and income statement
years, where financially justifiable. As the Group’s holding
changed significantly during the completed financial year
company, BAUER AG is dependent on the earnings of its
compared to the previous year:
subsidiaries, and additionally provides financing to them.
Main changes to the balance sheet:
Following the difficult financial year in 2015, the planned
• Receivables and other assets decreased by EUR 7.2
earnings after tax in the Group could only be achieved by
million. This was due to the change in receivables from
means of exceptional results. We believe it is appropriate to
affiliated companies amounting to EUR 7.0 million.
allow our shareholders to participate in this, so we intend
to pay a small dividend. The Management Board will thus
• Equity decreased from EUR 161.2 million to EUR 133.5
recommend to the Supervisory Board that it propose a
million. This was caused by the loss for the year amounting
dividend of EUR 0.15 (previous year: EUR 0.15) to the
to EUR 25.2 million and the payment of the dividend in 2015
shareholders. In order to reduce the burden on the capital
amounting to EUR 2.6 million.
base of BAUER AG which is making the dividend payment,
it has not been possible to increase the dividend in spite
• Liabilities increased from EUR 161.9 million to EUR 184.2
of the fact that higher earnings after tax were achieved in
million. The main factor responsible for this was growth in
the Group. Moreover, we are still intensively pursuing the
liabilities to banks by EUR 17.9 million, due to the financing
objective of improving the equity ratio of the Group.
activity of BAUER AG for the Group. Liabilities to affiliated
companies increased by EUR 3.6 million.
As the Group’s holding company, BAUER AG receives
earnings in particular from its subsidiaries. In 2016, dividend
Main changes to the income statement:
payments by the subsidiaries will be approximately the same
• Sales revenues, primarily related to charging of administra-
as in 2015, although no special effects are to be expected.
tive services to subsidiaries, increased by EUR 2.0 million
Consequently, BAUER AG should once again achieve a profit.
to EUR 32.1 million.
It has now become a tradition that customers and partners have come to especially appreciate: In April, the BAUER Maschinen Group
organized its in-house exhibition, presenting all kinds of new and further developments as well as tried-and-tested technology.
39
40
Sustainability
V. SUSTAINABILITY
SUSTAINABILITY IN THE BAUER GROUP
EMPLOYEES
Taking the slogan “BAUER’s Triple A”, the BAUER Group has
Our employees make the company what it is. Every single one
defined its most important action areas: health, safety and
of them jointly contributes to the success of the BAUER Group
environment, quality and ethics as well as performance. The
with their performance and their commitment. We owe thanks
slogan is based on the highest grade awarded by rating
to our employees in 2015 for being able to look back on 225
agencies when they evaluate the strength of a company.
years of experience at Bauer.
We have introduced many measures for the benefit of our
employees and customers in the field of health, safety and
Employee-related data
environment. Besides this, we seek to do justice to the
The companies of the BAUER Group employed an annual
expectations of our customers by offering a constantly
average of 10,738 employees all over the world (previous year:
perfected product range and top-quality services. In doing
10,405). They are divided up as follows:
so, we treat each other with respect and communicate on
an open partnership basis with the diverse stakeholder
groups. Performance, meaning the exertion of our corporate
economic power, is the key to the continued future development of the company. Our goal is to achieve the highest
grades – the A’s – in all three areas.
• Construction segment:
6,243 employees (previous year: 5,777)
• Equipment segment:
• Resources segment:
• BAUER AG and subsidiaries:
300 employees (previous year: 292)
The trend in personnel numbers within the Group was in
line with our expectations. Changes in our subsidiaries were
primarily registered outside of Germany in connection with
international construction projects. Individual contracts often
make major changes possible.
The action areas defined under BAUER’s Triple A also
By the nature of its operations, the workforce of the Con-
represent the core aspects of sustainability management.
struction segment is subject to the greatest fluctuation,
Employees by segment
Employees by employment type
12,000
10,000
12,000
10,253
269
1,578
10,264
286
1,449
10,405
292
1,400
8,000
10,738
300
1,276
8,000
2,919
10,253
239
10,264
240
10,405
248
10,738
245
3,664
3,835
3,948
4,050
6,350
6,189
6,209
6,443
2,936
2,998
2,952
10,000
6,000
6,000
4,000
4,000
5,454
6,243
5,777
5,531
2,000
2,000
0
0
2012
Construction
2013
Equipment
2014
Resources
2015
Others
2012
Industrial
2013
Salaried staff
2014
Apprentices
2015
Sustainability
depending on the number of major projects being handled
245 apprentices in 2015 (previous year: 248). Most of them
in specific countries. The greatest increases consequently
were being trained as industrial or construction mechanics,
occurred in the subsidiaries in Egypt (273 employees), the
electronics technicians, industrial managers or construction
United Arab Emirates (273 employees) and the Philippines
equipment operators. We train young people in some 20
(90 employees). In some countries, such as Malaysia and
different professions overall.
Indonesia, fewer people were employed during the year under
review than in the previous year because of the weaker state
We offer important opportunities to gain practical experience
of the market. The large order backlog led to an overall in-
even during the years of study. We support Bachelor’s or
crease of employees in Construction and primarily involved
Master’s degree students while they prepare their final theses
personnel recruited for specific projects.
and offer internships to provide interesting insights into our
business operations. In cooperation with Technische Hoch-
The number of employees in the Equipment segment
schule (technical college) Ingolstadt, we also offer a dual
decreased slightly. The main share of the decline is attributable
study course (i.e. combining theory and industrial practice)
to the Far Eastern plants (9 employees) and our German
in Mechanical Engineering.
subsidiary in Peine (13 employees) One of our key goals is to
retain the loyalty of our core of long-term employees, which
The BAUER Training Center GmbH assists our employees,
we once more achieved successfully in the past year.
customers and partners as well as interested outsiders as a
competent adviser on all questions of further and advanced
Further personnel reductions were undertaken in the
training. Its guiding objective is to constantly improve and
Resources segment because of restructuring measures,
professionalize its training and expand its scope in response
the reorientation of the segment and the weak market
to demand. The budget of the BAUER Training Center GmbH
situation in the mining area. A major share of the decrease
amounted to about EUR 2.5 million in 2015 (previous year:
took place in the subsidiaries in Jordan (73 employees) and
EUR 2.1 million). A total of 562 (previous year: 475) internal
the United Arab Emirates (25 employees). Employees in
and external seminars and external conferences were
Germany also had to be reduced.
attended.
Training and education
Diversity
We regard active participation in shaping the future careers of
The employees of the BAUER Group literally come from all
young people as an important social task. Bauer employed
over the world. Our staff included employees from 77 different
nations in 2015 – people from widely varying cultural and
ethnic groups who strive on every continent to achieve our
Employees by region
common goals. They mold our corporate culture with their
12,000
different outlooks and viewpoints, experiences and charac10,253
10,000
10,264
10,405
10,738
965
542
950
612
1,018
586
1,288
584
2,061
2,212
2,290
2,177
1,869
1,584
1,601
1,838
4,000
726
762
752
685
2,000
4,090
4,144
4,158
4,166
8,000
teristics. The promotion of diversity has therefore been firmly
rooted in our corporate goals for many years. We offer all
persons the same opportunities to contribute to the success
of the company, regardless on their origin, religion, age,
6,000
gender or sexual orientation.
In both the hiring and further development of our employees,
we attach great value to an assessment based exclusively on
their personality and qualification. In 2015, approximately 11 %
0
2012
2013
2014
2015
Germany
Europe (other)
Americas
Africa
of the group’s workforce were women – a figure which essentially reflects the technical nature of our business and the small
numbers of women who apply for such careers.
41
42
Sustainability
CAPITAL INVESTMENTS
RESEARCH AND DEVELOPMENT
In view of the general economic situation, we kept our capital
The BAUER Group once again invested substantial sums in
investments in 2015 at a relatively low level compared with
developing new construction methods and machinery as well
previous years, roughly approximating the level of amortiza-
as for research purposes in financial 2015. The accent here
tion. This was made possible by the extensive investments
is on the new and further development of different equipment
devoted to our plants in previous years. The pace of techno-
for specialist foundation engineering, the matching drilling
logical progress in our business has accelerated, however, so
tools and add-on units as well as deep drilling technology.
that any future increase of our revenues will demand higher
This is flanked by the new development and optimization of
investments once more.
construction site applications and procedures.
In the Construction segment, further investments were made
Research and development work in the BAUER Group is
in equipment to meet the market demand for ever more power-
organized on a decentralized basis. In companies belonging
ful machinery to handle specialist projects. For years now, we
to BAUER Maschinen GmbH, each major product group
have seen a trend towards increasingly large-scale international
has its own development unit that concentrates entirely on
infrastructure projects which foster growing demand for
the corresponding equipment, such as rotary or anchor
specialist foundation engineering works that can only be
drilling rigs. Within BAUER Maschinen GmbH, the diversified
carried out by ever-larger machinery. This demands higher
product range is divided into business areas that constantly
individual investments, but also opens up new market
develop their equipment families and ensure innovation in
opportunities for us. We have also concentrated specifically
their area. The central development department develops the
on investments to equip our construction sites with modern
technologies and components of a machine that are used in
communications technology.
several product groups. Basic research work is also located
in the central development department. Development work in
In the Equipment segment, the investments were chiefly
the BAUER Maschinen GmbH subsidiaries is grouped into the
channeled into modernizing the equipment available to the
system described above.
production sites.
Our construction areas also have their own development
Investments in the Resources segment in 2015 were also
capacities. In particular, BAUER Spezialtiefbau GmbH
at a low level. The investments went into the modernization
maintains a department for construction technology which
of existing production systems.
develops new methods and conducts fundamental research.
In financial 2015 the BAUER Group invested a total of EUR
To promote research that might be of Group-wide importance,
91.0 million (previous year: EUR 72.7 million) in intangible assets
internal and external orders for research work are placed via
and property, plant and equipment. Depreciation of fixed assets
the BAUER Forschungsgemeinschaft (research community).
across the Group totaled EUR 81.1 million (previous year: EUR
Simple ideas sometimes give rise to outstanding new tech-
78.8 million). Write-downs of inventories due to use Group-wide
niques that help our companies to achieve technological
totaled EUR 13.2 million (previous year: EUR 15.8 million).
advances.
Additions to the property, plant and equipment assets of
This type of overall organization for research and development
BAUER AG in the 2015 financial year totaled EUR 6.5 million
work has proven highly effective. Rapid decisions and great
(previous year: EUR 2.3 million), against depreciation of EUR
flexibility allow all products to be kept at the cutting edge, while
2.9 million (previous year: EUR 2.9 million).
new ideas and market requirements can be implemented
quickly.
We will again keep investments in balance with amortizations
in 2016.
A major focus of equipment development in the past year was
the ValueLine, a range of rotary drilling rigs optimized for kelly
Sustainability
drilling. A new generation of rotary drilling rigs was introduced.
the ground while a mixer simultaneously combines
The middle platform range, which is configured for bored piles
the surrounding soil with cement in the casing’s interior.
with a diameter of up to 2.5 meters and a drill depth of up to
This anchors the pile in a stable mixture of sand and cement.
70 meters, comprises the BG 26 and BG 30. The advantage
Thanks to its high load-bearing capacity and rapid completion,
of focusing on these two models is that they closely match
the process offers an economical foundation method for
each other technically and their components can therefore be
offshore platforms, even when faced with difficult geological
switched between the two.
conditions in chalky sand. The noise development in this case
is practically negligible compared to pile-driving technology.
The core element of the middle platform is the common BT
The procedure is therefore particularly suitable for use in
base carrier, which was entirely designed and constructed by
noise-sensitive coastal regions. Bauer offers MIDOS as the
Bauer. This thoroughly considered modular approach allows
future solution for all types of offshore foundations.
varying equipment sizes to be configured from the machines
of different business areas. The modern and highly functional
To increase the safety and efficiency of deep geothermal
base carrier does not just score points for its high safety
drilling operations, a concept for the construction of a fully
standards and very low noise emissions. The large-diameter
automated deep drilling rig was worked out in the AUTIG
hydraulic lines ensure optimal efficiency, which has a direct
(Automated Drilling Technique for Deep Geothermal Energy)
effect on the fuel consumption. An integrated service platform
research project, which was successfully concluded in 2015.
allows for easy, safe access for all types of maintenance work
This enables the number of persons in the working area of the
on the uppercarriage. A grating step, which is integrated into
machine to be reduced in order to improve both the safety
the door system of the uppercarriage, can be pulled out by
and profitability of the drilling operation. Many concepts and
opening the paneling. The lateral paneling then acts as fall
innovations drawn from the project, such as the ultra-modern
protection. This safety system is the only one of its kind in the
control technology and the high degree of system automation,
world and sets a new standard in the area of Health, Safety &
also became preconditions for Bauer’s ability to form a joint
Environment. The German sectoral manufacturers’ association
venture with Schlumberger to build deep drilling rigs.
(Verband der Baubranche, Umwelt- und Maschinentechnik
e.V. – VDBUM) has awarded its promotional prize for 2016 to
For many years now, our products and services have
the system.
extended well beyond the bounds of specialist foundation
engineering. The BAUER Group today is a machinery manu-
In the research area, BAUER Maschinen GmbH was nomi-
facturer and service provider in all fields dealing with ground
nated for the 2016 innovation prize of the annual Bauma
and groundwater. Pursuing that strategy, many units within the
construction equipment fair for its MIDOS technology, which
Group have been undertaking additional development work,
can be used for various offshore foundations. MIDOS (Mixed
such as to design new pipes for underground engineering
Drilled Offshore Steel) is based on the Mixed-in-Place method,
installations, to advance water purification based on a wide
which is conventionally used for specialist foundation engi-
variety of methods, and to produce modern materials for
neering. The method is applied by inserting a steel casing into
use in geotechnical applications. A state-of-the-art system of
Research and development in the BAUER Group
2014
Construction Equipment
Total Group Revenues (in EUR million)
2015
Resources
BAUER
Group
Construction Equipment
Resources
BAUER
Group
699.0
612.6
248.6
1,560.2
733.8
705.1
217.5
1,656.4
Expenses for R&D (in EUR million)
2.9
23.1
1.9
27.9
2.8
23.0
1.2
27.0
as % of total Group revenues
0.4
3.8
0.8
1.8
0.4
3.3
0.6
1.6
5,777
2,936
1,400
10,405
6,243
2,919
1,276
10,738
41
183
22
246
39
186
12
237
Group employees
R&D employees
43
44
Sustainability
innovation management is practiced with great intensity by all
As a globally operating company, we bear a special respon-
Group units.
sibility for our environment. In all aspects of our company,
we therefore place great emphasis on protecting it and
In the Equipment segment we invest a good 3.3 % (including
handling natural resources with care. Along with the topics
internal and project-related expenditure) of the corresponding
of health and safety, environmental management at Bauer is
portion of total Group revenues in research and development.
an essential constituent of the Group-wide HSE policy. We
A staff of 186 people are involved in this field, as well as
continuously examine the implementation of our environmental
outside consulting engineers and interns. Research and
policy in the course of internal audits.
development activities are routinely reviewed and maintained
at a high level to keep pace with the ever-increasing rate of
QUALITY
change in market demands.
High-quality products, services and equipment are the
precondition for satisfying our customers and the key to our
Research and development expenditure in the Construction
success. To meet the multi-faceted needs and expectations of
segment is 0.4 % of total Group revenues, and in the
our customers as fully as possible, we place great emphasis
Resources segment 0.6 %. We are investing considerable
on preserving the high quality standard of our company and
further resources to prepare and design construction sites.
expanding it wherever possible. We focus special attention on
the issues of ethics, safety and health protection, environ-
HEALTH SAFETY ENVIRONMENT (HSE)
mental compatibility, profitability and sustainability.
For the BAUER Group, Health, Safety & Environment (HSE)
is an integral element of everything we do in creating and
Our quality management system is based on ISO 9001 and
developing all our products, specialist services, and business
the relevant statutory and industrial standards. We conduct
processes. Globally applied HSE standards have enabled us
regular audits and benchmark reviews to make sure we are
to create a uniform HSE management system for all compa-
meeting our planned quality goals. The findings from these
nies in the Group. By constantly reviewing our performance
audits and reviews are incorporated into our regular training
and comparing it against our set goals and parameters,
programs. We motivate our staff by demonstrating our own
we seek to continuously improve our HSE system and thus
commitment to quality, setting challenging goals for them,
consistently minimize our accident and damage rates. The
giving them sufficient responsibility and recognizing good
application of our health, safety and environmental policy is a
performance. Active cooperation is essential to meet our
central task of the respective managements and is regularly
work targets quickly.
audited within the Group.
At the beginning of 2015, BAUER Maschinen GmbH submitThe efficacy of occupational protection measures in our com-
ted to an audit by the American Petroleum Institute (API), the
pany is determined to a large extent by the conduct of our
largest representative body of the oil and gas industry as well
employees. We are consequently committed in many ways to
as the petrochemical industry in the USA. For this purpose,
raise awareness of the occupational safety issue throughout
BAUER Maschinen GmbH updated its entire management
the Group. We offer regular training courses on HSE. Weekly
documentation and added the API Q1 requirements to the
safety meetings are held at our construction sites and all our
ISO 9001 standard. This enabled the company to attain API
production facilities. This ensures a better understanding and
Q1 certification.
greater acceptance of safety guidelines among our staff.
Legal disclosures
VI. LEGAL DISCLOSURES
REMUNERATION REPORT
and is paid in full if all set goals are attained. If business
The Remuneration Report sets forth the system of remune-
performance is exceptionally good, the said levels may be
ration paid to the members of the Management Board and
surpassed by up to 1.8 times.
the total amounts paid to them, and explains the underlying
principles and amount with regard to the remuneration paid
The short-term criteria applied in setting the variable remu-
to the Supervisory Board.
neration elements are the performance of the respective
Management Board members in the past financial year and
Remuneration of the Management Board
the economic position of the Group in respect of attainment
The Management Board of BAUER AG, as previously,
of budget targets in the year under review, particularly the
comprised three members in the year under review. The
attainment of profit and revenue targets, taking into account
Supervisory Board sets the overall levels of remuneration
general economic trends.
paid to the individual members of the Management Board,
based on proposals submitted by the Presidial and Personnel
The long-term criteria applied in setting the variable remu-
Committee. The plenary Supervisory Board approves the
neration elements are the success and future prospects of
remuneration system for the members of the Management
the Group and the performance of the Management Board
Board following prior consultations in the Presidial and
in respect of these criteria. This assessment judges the decisi-
Personnel Committee.
on-making of the Management Board in terms of sustainable
business development over the past three financial years and
The system of remuneration paid to the members of the
the effects of this decision-making in achieving long-term
Management Board did not change from the previous year.
stability for the business. Criteria applied here are long-term
The overall levels of remuneration paid to the individual
profit and revenue prospects, sustainable personnel deve-
members are set on the basis of a performance assessment.
lopment in accordance with the future prospects of the Group,
This process assures that the overall remuneration is appro-
the development of the corporate culture, the development
priate to the duties and performance of the Management
of intra-Group collaboration, the safeguarding of corporate
Board member concerned and to the situation of the com-
harmony, strategic market and product development, risk
pany. The remuneration paid to each Management Board
and security management, long-term financial stability, and
member is composed of non-performance-related com-
the quality of key financial indicators relative to the prevailing
ponents, chiefly a fixed basic salary, paid in equal monthly
economic conditions.
installments, and a performance-related component in the
form of a variable annual bonus. This is set by the Supervi-
In assessing the appropriateness of the remuneration paid
sory Board on the basis of short and long-term evaluation
to the Management Board, the variable remuneration is set
criteria, in which case the short-term evaluation criteria are
and compared in proportion to the fixed basic salary. Further-
equally weighted with the long-term ones when setting the
more, the fixed and variable portions respectively, and the
variable remuneration.
overall remuneration paid, are compared against the normal
levels of remuneration received by management board mem-
The criteria for setting the fixed remuneration to members
bers of other stock market quoted companies, and other
of the Management Board are the assignment of duties, the
companies operating in the same sector, or companies
performance of the respective Management Board member,
similar in other ways, in Germany (horizontal comparison).
the economic position of the Group and its profitability and
A vertical comparison is carried out on two levels: firstly, the
ongoing future prospects.
salaries of the Management Board members are compared
against those of the directors of the major BAUER Group
Maximum limits are imposed on the total remuneration paid.
subsidiaries; secondly, they are assessed relative to salary
The variable remuneration paid to each member of the
grade A VIII stipulated in the collective pay agreement appli-
Management Board is limited by an individually defined
cable within the Group within the industry-wide framework
maximum bonus level. This maximum is the upper limit of
of salary and training remuneration to salaried staff and fore-
potential bonus payment in the normal course of business,
men in the construction sector.
45
46
Legal disclosures
The remuneration is further set so as to remain competitive
Remuneration of the Supervisory Board
with that generally paid to highly qualified management staff
The Supervisory Board of BAUER AG comprises 12 members.
on the market as a whole.
Calculation of the remuneration paid to the members of the
Supervisory Board is specified in detail in the Articles of
The Annual General Meeting held on June 30, 2011 resolved
Association of BAUER AG. Each member of the Supervisory
that the BAUER AG financial statements and the Group con-
Board receives a basic annual fee of EUR 18 thousand,
solidated financial statements for the financial years 2011 to
payable in December of each financial year, plus reimbur-
2015 would contain no disclosures of the remuneration paid
sement of out-of-pocket expenses and any sales tax (VAT)
to individual Management Board members, thereby applying
liability incurred in performing the duties of a Supervisory
the legal authority assigned to it by section 286, subsection
Board member. The Chairman of the Supervisory Board
5 and section 314, subsection 2 of the German Commercial
receives twice that amount of remuneration, and the Deputy
Code (HGB).
Chairman 1.5 times the amount. The basic remuneration
amounts are increased by 10 % for each membership of a
The total remuneration paid to members of the Management
Supervisory Board committee, provided that the committee
Board in the year under review, excluding allocations to pension
in question was convened at least twice in the financial year.
provisions, was EUR 1,274 thousand (previous year: EUR
Membership of the Mediation Committee is excluded from
1,150 thousand). Of that total, EUR 1,124 thousand (previous
these remuneration provisions. Changes to the Supervisory
year: EUR 1,090 thousand) was not performance-related and
Board and/or its committees are taken into account in the
EUR 150 thousand (previous year: EUR 60 thousand) was per-
remuneration proportionate to the respective member’s time in
formance-related. The total remuneration includes benefits
office, and rounded up or down to full months based on the
in kind arising from the private use of a company car and reim-
standard commercial rule. The members of the Supervisory
bursement of expenses for each member of the Management
Board receive no performance-related pay.
Board, as well as group accident insurance premiums and
employer’s liability insurance association contributions.
The net remuneration paid to all the members of the Supervisory Board in the 2015 financial year totaled EUR 254 thous-
The company pension scheme for Management Board
and (previous year: EUR 254 thousand).
members incurred pension service costs totaling EUR 155
thousand (previous year: EUR 159 thousand). The baseline
Other
salary defined for calculating retirement benefits is significantly
No loans or advances were paid to members of executive
lower in all contracts than the basic salary. Calculated in
bodies of the company in the year under review, nor were any
accordance with IAS 19, the defined benefit obligation
liabilities entered into in their favor. As a matter of principle,
entailed by all pension commitments to members of the
no securities-oriented incentive systems exist for members
Management Board at the year-end was EUR 5,537
of the Management Board or Supervisory Board of BAUER
thousand (previous year: EUR 5,531 thousand).
AG, or for Group employees in Germany. BAUER AG provides
D&O (Directors and Officers) group insurance cover in respect
The contracts of Management Board members include
of liability for economic loss to the members of executive
individual severance clauses regulating the specific terms
bodies of BAUER AG and of all affiliates in Germany and
of premature termination, with settlements oriented to the
internationally in which a majority share is held. The D&O
length of service of the Management Board member con-
policy includes an appropriate excess for the insured parties.
cerned and gauged so as not to exceed the sum of two ye-
For the members of the Management Board, the minimum
ars’ remuneration for any one Management Board member.
excess stipulated by law of 10 % of the loss up to at least
No provisions for compensation in the event of a takeover
an amount representing one and a half times the fixed
offer being made have been agreed with the members of the
annual remuneration of the Management Board member
Management Board.
concerned was agreed in the D&O insurance policy in the
year under review.
Legal disclosures
Remuneration Supervisory Board (not including sales tax proportion and reimbursement of expenses)
in EUR ’000
2014
2015
38
38
27
27
Dr.-Ing. Johannes Bauer
20
20
Dipl.-Ing. (FH) Rainer Schuster
18
18
Chairman
Dr. Klaus Reinhardt
Deputy Chairman
Robert Feiger
Employer representatives
Dipl.-Ing. (FH) Elisabeth Teschemacher
18
18
Gerardus N. G. Wirken
20
20
Prof. Dr. Manfred Nussbaumer
20
20
Dipl.-Volkswirt Norbert Ewald
20
20
Dipl.-Kfm. (FH) Stefan Reindl
18
18
Regina Andel
18
18
Dipl.-Ing. Gerold Schwab
20
20
Employee representatives
Reinhard Irrenhauser
Total *
18
18
254
254
* rounded
The members of the Management Board are required to
Composition of subscribed capital
limit the extent to which they take on Supervisory Board
The subscribed capital (share capital) of BAUER AG re-
mandates and other administrative or voluntary functions
mains unchanged at EUR 73,001,420.45 and is divided into
outside of the company. The members of the Management
17,131,000 no-nominal-value bearer shares, representing
Board may not, without the consent of the Supervisory
a pro rata amount of approximately EUR 4.26 per share
Board, carry out any trade or business or conduct, on their
of the total share capital. Each share entails equal rights,
own or a third-party’s account, any dealings in the sector in
and entitles the holder to one vote at the Annual General
which the company operates. Further, they may not, without
Meeting, with the exception of share categories precluded
the consent of the Supervisory Board, become a manage-
from voting by law pursuant to section 136 of the German
ment board member, director or personally liable sharehol-
Stock Corporation Act (AktG) and section 28 of the German
der of any other trading company. This ensures that no conflict
Securities Trading Act (WpHG).
arises with the assigned duties of the Management Board
member either in relation to time commitment or to remun-
As in the previous year, 51.81 % of the shares were in free
eration received. No separate remuneration is paid for the
float. The members of the Bauer family and the BAUER
assumption of executive or supervisory mandates on the
Stiftung, Schrobenhausen, own a total of 8,256,246 no-
boards of Group companies.
nominal-value shares in BAUER AG on the basis of a pool
agreement, representing a 48.19 % share in the company.
STATUTORY DISCLOSURES REGARDING TAKEOVERS
The pool agreement provisions include binding voting com-
The following disclosures are made pursuant to section 315,
mitments as well as restrictions on the transferability of pool
subsection 4 and section 289, subsection 4 of the German
members’ shares. No other direct or indirect holdings of
Commercial Code (HGB) as per December 31, 2015.
BAUER AG share capital exceeding 10 % of the voting
rights are known to the company.
47
48
Legal disclosures
None of the shareholders have special rights entailing con-
market, the acquisition price (excluding ancillary costs) may
trolling powers. Nor does any voting rights control exist on
be no more than 10 % above or 20 % below the price de-
the part of the employees holding shares in the capital.
termined by the opening auction on the trading day for shares
in the company in Xetra trading (or a comparable successor
Authority of the Management Board to issue or buy
system) on the Frankfurt Stock Exchange. If the acquisition
back shares
is effected by means of a public tender offer, the purchase
Section 4, subsection 4 of the company’s Articles of Asso-
price or the limits of the purchase price span per share
ciation authorizes the Management Board, with the consent
(excluding ancillary costs) may be no more than 10 % above
of the Supervisory Board, to increase the share capital once
or 20 % below the average of the closing prices per share
or more than once up to June 27, 2017 by up to a total of
in the company in Xetra trading (or a comparable successor
EUR 7.3 million by the issue of new ordinary bearer shares
system) on the three trading days prior to the day of issue
against cash and/or non-cash contributions. To that end,
of the public tender offer. If not insignificant variations of the
the Management Board is authorized, with the consent of
decisive share price occur after the day of issue of the public
the Supervisory Board, to exclude the legal subscription
tender offer, the purchase price may be adjusted.
rights of shareholders in the following cases:
The Management Board shall be authorized to appropriate
• in the event of capital increases against non-cash contributions;
shares in the company acquired pursuant to the above authorizations for all legally admissible purposes. Consequently,
the acquired shares may also in particular be sold by means
• in the event of capital increases against cash contributions
other than by way of the stock market or by means of an
where the issue amount of the new shares issued is not
offer to the shareholders, if the shares are sold for cash at
materially below the market price of the already quoted
a price (excluding ancillary costs) not materially below the
shares at the time of definitive setting of the issue price
stock market price of shares of the company carrying the
and the shares issued excluding shareholders’ subscription
same rights at the time of the sale in Xetra trading (or a
rights pursuant to section 186, subsection 3, clause 4
comparable successor system). The shares may also be
AktG do not in total exceed 10 % of the existing share
sold in return for non-cash payment, provided this is done
capital either at the time this authority takes effect or at
for the purpose of effecting company mergers or acquiring
the time of exercising this authority. Shares which have
companies, parts of companies, shareholdings in companies
been or are to be sold or issued in direct or correspon-
or other assets. The aforementioned shares may be redeemed
ding application of section 186, subsection 3, clause 4
without need of a further Annual General Meeting in order
AktG while this authority is in place until such time as it
to approve the redemption or its execution. With regard to
is exercised, pursuant to other authorities, excluding sub-
use of the bought-back shares, the authorization provides,
scription rights, are to be set off against the said 10 % limit;
in specific cases, for legal rights of subscription of shareholders
to be excluded. The facility to acquire treasury stock has not
• to balance out fractional amounts.
been utilized to date.
By resolution of the Ordinary Annual General Meeting held
Appointment and termination of appointment of
on June 26, 2014, the company was authorized to acquire
Management Board members, amendments of the
treasury stock, over a limited period up to June 25, 2019,
Articles of Association
representing up to a total of 10 % of the company’s share
The appointment and termination of appointment of mem-
capital at the time the resolution was passed. The shares
bers of the Management Board of BAUER AG is regulated
shall be acquired at the discretion of the Management Board
by sections 84 and 85 of the German Stock Corporation
by means of a public tender offer or by way of the stock
Act (AktG) and sections 30 ff. of the German Co-determi-
market. If the acquisition is effected by way of the stock
nation Act (MitbestG) in conjunction with Articles 5 and 6
Follow-up Report
of the company’s Articles of Association. Pursuant to the
amounts to less than 40 % of the capital shares or voting
company’s Articles of Association, the Management Board
rights in BAUER AG. A third party gains control if, overall,
comprises at least two persons, who are appointed by the
more than 50 % of the capital shares or voting rights in
Supervisory Board for a maximum term of office of five years.
BAUER AG is held directly or indirectly by one or more
At present the Management Board comprises three mem-
persons acting jointly (with the exception of the pooled
bers appointed by the Supervisory Board and a Chairman
members of the Bauer family).
of the Management Board, as well as a Labor Director. It is
permissible to re-appoint or extend the appointment of a
Furthermore, several long-term loans with balances totaling
member of the Management Board for a further maximum
EUR 178.5 million as per the balance sheet date, agreed
term of office of five years. Any appointment or re-appoint-
by BAUER AG together with other Group companies as the
ment requires a decision by the Supervisory Board, which
borrower and guarantor, provide for a right of termination
may be taken no earlier than one year prior to the end of
for cause by the lender in the event of a change of control
the relevant term of office. The Supervisory Board may
in BAUER AG. A change of control is considered to have
rescind an appointment to the Management Board or an
taken place where a third party, not forming part of the circle
appointment as Chairman for good cause. The Presidial and
of existing main shareholders, directly or indirectly acquires
Personnel Committee of the Supervisory Board prepares
control of at least 30 % of voting shares or the majority
the Supervisory Board’s decisions on the appointment and
of outstanding share capital of BAUER AG. Any loaned
termination of appointment of Management Board members
amounts would have to be repaid in the event of termination.
and concerns itself with the long-term planning of successor
The terminated credit line would no longer be available for
members for appointment to the Management Board.
new borrowing.
In accordance with section 119, subsection 1 clause 5 and
Additional short- and long-term loan agreements also exist
with section 179 AktG, the amendment of the Articles of
within the Group which provide for a right of termination for
Association is passed by the Annual General Meeting with
cause, at market terms, in the event of a change of control.
a majority of at least three quarters of the share capital
represented at the vote. Pursuant to Article 12 of the Articles
of Association, the Supervisory Board is authorized to pass
amendments to the Articles of Association which relate only
to its wording. The Supervisory Board is further authorized
VII. FOLLOW-UP REPORT
to adapt the wording of Article 4 of the Articles of Association (amount and division of the share capital) following full or
No matters of special note occurred after the end of the
partial execution of the increase in share capital or on expi-
financial year.
ration of the authorization period according to the respective
utilization of the authorized capital.
Change of control
BAUER AG, together with other Group companies, has
concluded a syndicated loan agreement providing a credit
line of up to EUR 450 million; this contains provision for the
lender to terminate its loan commitments in the event of
a change of control or if control is gained by a third party.
As defined by this syndicated loan agreement, a change of
control is defined as a situation in which the total shareholding held by the pooled members of the Bauer family directly
49
50
ZUSAMMENGEFASSTER LAGEBERICHT
Nachtragsbericht
VIII. RISK AND OPPORTUNITY REPORT
RISK REPORT
BASIC PRINCIPLE OF RISK MANAGEMENT
Risk categories defined by the BAUER Group are: strategic
As part of our business activities, we are exposed to risks that
risks; market risks; financial market risks; political and legal
are inseparably linked with our operations. It is impossible to
risks; organizational and governance risks; risks arising
run a business without taking risks. True risks result from un-
from the value creation chain; and risks of the supporting
foreseeable events that can bring both hazards and oppor-
processes. These risks are grouped as latent risks and
tunities along with them. To us therefore, risk management
managed in a unified process within the framework of our
means not only reducing the hazards but also knowing how
risk management system. Conversely, project risks are
to take advantage of the opportunities. The goals of risk
managed by an additional, independent process according
management are to protect our business objectives, increase
to their nature and significance.
the value of our company and reduce the costs of risk. The
tasks of risk management are to identify, analyze, evaluate
The process of identifying and assessing latent risks is
and monitor existing and foreseeable risks along the entire
reviewed biannually at working sessions of the relevant
value chain and devise actions to deal with them. This involves
Group company managements and is implemented jointly
assessing external risks for our company as well as those
with departmental and central function heads as well as
that arise internally. Our risk management is based on a
individual specialists. This process ensures that potential
fundamentally risk-avoiding approach that aims to safeguard
new and familiar risks and opportunities are submitted for
us against impending risks rather than to grasp opportunities
review at management level. Structured risk identification is
for short-term gain. As a general rule, we do not take risks
followed by risk assessment based on a scale of relevance.
that threaten the existence of the company.
Relevant risks above a certain threshold value are quantified
Risk management system
based on scenarios. Planning risks are estimated on the basis
Our risk management system is based on the risk policy
of empirical values, applying standard deviations. Risks from
defined by the Management Board, and regulates the hand-
within the subgroups are consolidated at Group level.
ling of risks within the BAUER Group. It defines a uniform
methodology applicable to all segments and their member
Following assessment, risk-specific management measures
companies. It is continually reviewed and adjusted as
are defined. Where possible and useful, we have taken out
required.
appropriate insurance cover in respect of potential damage
and liability risk, in order to reduce our risk exposure and
Our risk management system is an integral element of our
avoid, or at least minimize, potential losses. Responsibility
overall management system and, like all our management
for monitoring the particular risks lies with the risk managers
systems, serves as an instrument of value- and success-
of the operative areas.
oriented corporate governance. Audits routinely verify its
implementation and management reviews continuously
The effects of individual risks are aggregated in the context of
improve its efficacy. Furthermore, our auditors annually
corporate planning by means of risk simulation. This means
review the extent to which our early risk-warning system is
that the income statement for a given financial year is played
capable of detecting existentially threatening risks in good
through several thousand times in independent simulations
time. Their suggestions are incorporated in order to improve
based on random figures (Monte Carlo simulation).
the system. The process steps involved in risk management
are: identification, assessment, control of measures and
The risk analysis, comprising identification, evaluation and
monitoring.
definition of measures, is carried out at least every six months.
Yearly reports are submitted to the Management Board and
For the identification of risk, risk categories are defined and
Supervisory Board. The system is continually being updated
assigned to specific areas of risk. This defines areas of focus.
and continuously improved both qualitatively and structurally
Our customer Drill Tech Drilling & Shoring, Inc. decided to use a BG 50 during the demolition of a power plant at Eureka in California.
During work on the site, the gigantic rotary drilling rig achieved a mixing depth of about 52 m – more than has ever before been
achieved with a kelly-guided CSM unit.
51
52
in terms of the integration of more Group companies. To
The system has been developed over a number of years
communicate acute risks, the routine risk analysis is supple-
across the corporate units faced by the relevant project risks
mented by immediate reporting. Our risk management
and expanded to apply to the relevant operations.
system covers both risks and opportunities.
Risks
Handling of project risks
In the following we set forth potential risks which may have a
Project risks are the principal performance risks, and thus
significant impact on our financial and earnings position and
are an integral element in the work of the Construction and
on our reputation, and assess the relevance to our business.
Resources segments, wherever construction work or plant
The breakdown follows the same risk categories as we apply in
assembly is carried out on the customer’s premises. Associ-
our risk management system. The areas of risk are aggregated.
ated risks, such as in relation to the ground and resulting from
Unless otherwise specified, all risks set out in the following
the individual character of each individual project – including
relate to all our segments.
contract, timetable and damage risks – can thus accumulate
detrimentally in specific cases in such a way that they may
STRATEGIC RISKS
threaten the existence, if not of the Group as a whole, at
Segmental structure
least potentially of smaller subsidiary companies. In respect
We counter the strategic risks arising from the segmental
of all relevant projects above low threshold values, prior to
structure of the Group by dividing it into separate Construction,
submission of quotes all conceivable risks and opportunities
Equipment and Resources segments, thereby pursuing the
are systematically identified, analyzed and assessed, and
aim of greater independence from the economic cycles of the
appropriate measures are defined to minimize risks and
construction industry.
track opportunities. In ongoing projects, the risks relating to
continuous project controlling and project management are
The Equipment segment’s move into deep drilling and the
analyzed; this means they are identified, evaluated and have
manufacture of machinery for mining applications will further
measures applied to them.
reduce its dependence on the Construction segment. We
class the risks associated with the structure of our business
Each project is assigned to a risk class and organizationally
as medium.
escalated according to its risk class, and is thus subject to
a strict approval process. Risk classification is based, firstly,
Brands, image, PR
on defined checklists applying the K.O. principle, in order to
The Bauer brand carries a cachet for purchasers, especially in
prevent inadvertent assignment to an inappropriately low risk
the Equipment segment, because it is known for high quality.
class. Secondly, it is based on potential harm identified in
Negative influences on our image, whether due to publications
relation to the project, with the worst-case outcome serving
about accidents at work or quality and service defects for
as the decisive factor. The risk classes defined by this process
example, can result in falling demand for our machines. We
are taken into account at fixed cost surcharges to cover the
minimize this risk by, among other measures, our highly
identified risks.
developed quality and HSE management system. We regard
the risk of damage to our image as a moderate one.
Relevance scale of the BAUER Group
Relevance
Definition
Identified risks
1
Insignificant to low risk
2
Medium risk
Risks with this relevance are identified
in our business
3
Significant risk
4
Serious risk
5
Critical risk
We do not see risks with this relevance
in our business
MARKET RISKS
of our machinery. The lack of market experience of Chinese
Selling market risks
manufacturers, combined with the facts that the quality of
It has always been one of our key strategic principles to count-
their products remains significantly lower and their after-sales
er risks on our selling markets by means of a multi-segment
service is generally of a less developed nature, has to date
organization. Whereas our machinery manufacturing business
impeded exports of Chinese construction machinery on a
is still heavily influenced – if at a delay – by economic trends in
grand scale to the markets of relevance to us. Several of
the construction sector, the establishment of the Resources
these enterprises embarked on substantial capacity cutbacks
segment has enabled us to isolate part of our business from
and layoffs in the course of 2015. A number of Chinese
the effects of construction cycles much more effectively. Our
competitors have already been forced out of market. This
strategy of spreading business in each segment across a large
risk is still rated as low in the short term, but medium in the
number of markets worldwide further reduces the overall risk,
medium term.
so that no serious risk is posed to the Group as a whole in
the event of any weakening or collapse of individual regional
Risks of market development
markets. Moreover, in the event of a regional market downturn
High levels of public sector debt in the USA, as well as in some
our network strategy in the Construction segment enables
EU member-states, significant interventions by some central
us to relocate our capacities rapidly to another country and
banks as well as uncertainty as to the stability of markets in
continue operations at the new location. This strategy has
specific countries and the phases of significant downturn on
proven effective during various regional crisis situations in the
the market in China and the other BRIC nations influence our
past, in which it cushioned negative impacts on the overall
appraisals of the macro-economic situation. Ongoing political
result. Our Resources segment has also already expanded on
unrest in the Middle East is impeding willingness to invest in
an international scale. We rate risks associated with our selling
the countries immediately affected, and often beyond.
markets as medium.
The significant drop in the oil price may well be easing pressure
Competitive environment
on importing countries’ balances of trade, but in the long term
In the Equipment segment especially, we operate in highly
it will restrict the purchasing power and investment appetite
competitive, price-sensitive markets. The Chinese construction
of the oil producing countries in the Middle East and Russia. If
market – and to an even greater extent in its wake, the Chinese
the oil price remains low for a long period, this could also have
construction machinery market – have seen highly dynamic
a negative effect on demand for deep drilling rigs and services
growth in the past as a result of government policy. As a
for the oil industry, as well as on infrastructure expenditure by
consequence, major production capacities for construction
oil-producing countries. As a result of the significantly reduced
machinery were created. The repeated stagnation of the
oil price and the tense situation in the east of Ukraine, leading
Chinese construction market since 2012 has seen demand
to sanctions against Russia, there was a significant drop in
for new machinery decline, in some cases disproportionately
value of the Russian ruble against the euro. All in all, this
dramatically. The resultant overcapacity in the country has
hampers equipment sales to Russia.
placed prices and margins under heavy pressure at times. We
have implemented intensive cost-cutting measures in order to
These issues have created both exchange rate risks and
lastingly improve our competitiveness in China. For example,
demand-related risks in the markets concerned. By contrast,
production above all as well as sourcing has been localized to
the overall positive macro-economic situation in the Far East
a significant extent, and the level of professionalism increased
is creating a structurally greater dependence of the Group on
while retaining the familiar high quality standards. Furthermore,
that region.
the after-sales service has been expanded further in all markets
as a stabilizing factor for new business.
The Group Management Board and the directors of the three
operating segments routinely consider projections based on
Despite the overcapacity and associated pressure on margins
specific scenarios to estimate the impact of any given risks
in China, we were able to maintain our market position based
on the company in question and on the Group as a whole.
on the recognized high quality and still clear technical edge
Any necessary and relevant measures are derived from these
53
54
analyses and implemented in full. The risks to the market
undertake a write-down. We estimate that the risk of needing
development are currently assessed to be moderate.
to undertake a write-down on the goodwill is a moderate one.
FINANCIAL MARKET RISKS
POLITICAL AND LEGAL RISKS
Financial stability and liquidity
Compliance
Several long-term loans are covered by covenants linked to
For the BAUER Group, acting responsibly and in keeping with
pre-determined financial variables. These are primarily the
the law is a fundamental principle underpinning our commer-
ratio of net debt to EBITDA, the ratio of EBITDA to net interest
cial success, the quality of our products and services and
coverage, and the equity ratio. The key figures agreed for the
our sustainable ongoing development. We place the utmost
promissory notes and the syndicated loan concluded in 2014
value in upholding social conventions and in complying with
were met by the year end.
applicable laws and business standards, so as to minimize the
risk of non-compliance. For us, compliance means observing
In addition to the earnings situation of the Group as a whole,
all applicable laws, rules and regulations. Legally compliant,
higher financing requirements in particular may pose an
ethical and socially sustainable action is the cornerstone of
increased covenant risk. This applies, for example, to changes
our values management system. This will be applied to ensure
in inventories in the Equipment segment. In order to reduce
staff are aware of our fundamental values as soon as they are
that risk, active selling of surplus stocks is initiated and
hired. Special training courses enable them to extend their
production volumes are reduced as necessary. A high level
knowledge. A special software program ensures that we do
of outstanding receivables can likewise result in the inability
not do business with any companies cited on an EU or US
to meet agreed covenants.
sanctions list.
Based on forward-thinking planning and sound financial
In summary, we are of the opinion that our existing values
controlling, we are making every effort to keep within the
management system provides us with an efficient means of
agreed limits. This risk is classed as medium.
keeping our compliance risk to a low level.
The risk of financial instability and supply shortages on inter-
Contract risks
national financial markets was countered by concluding a
Our Construction and Resources segments primarily provide
syndicated loan agreement. This agreement ensures the
construction, drilling and environmental services. The under-
medium-term liquidity supply for the Group of companies, and
lying projects are almost always prototypes executed in each
is an important tool for alleviating major risks on the financial
case on the basis of customized contracts. The resultant risks
markets.
are subject to stringent management routines, and so can be
rated as low.
Foreign exchange risks
Where possible and available, we counter foreign exchange
Current legal cases
risks by financing our international holdings in their respective
Legal disputes arise almost exclusively from our provision of
local currency. Transaction risks (foreign currency risks arising
services, in particular in the project business. Judicial disputes
from the current cash flow) are minimized in all business
exist with regard to clients, suppliers and business partners,
divisions by means of suitable rate hedging instruments.
and in the majority of cases relate to remuneration, claimed
The remaining currency risks are evaluated as slight.
deficiencies in performance or delays in completing a project.
By their very nature, it is impossible to say for certain how the
Participations, acquisitions, financial assets
court or arbitration proceedings we are involved in will turn out.
The valuations of the shares in associated companies contain
Nevertheless, following careful examination, we assume that
goodwill items, the values of which are subject to the risk from
adequate provision has been made in the balance sheet for all
future company developments. If these future expectations do
legal disputes.
not come to fruition as expected, it will become necessary to
VALUE CREATION RISKS
A further risk in order fulfillment is entailed by the selection and
Research and development risks
application of drilling techniques. Misjudging ground conditions
As a technology leader, particularly in our Equipment segment,
can likewise result in increased risk costs. Disturbances to the
we counter any possible weakening of our market position by
project timetable must be identified by the project manager and
means of continuous research and development. Although
communicated at an early stage. The management is aware of
the booming markets in the Far East and the resultant new
these risks, and relies on experienced project and production
competitors are sharpening the innovative pressures, we have
managers in all segments. In spite of all the precautions taken
to date succeeded in maintaining the necessary edge as a
when carrying out orders, there is still a risk of management
technology leader.
errors in major projects. All the listed risks are subjected to a
threat and opportunity analysis at project level in the Con-
Moreover, there is a risk of incurring additional costs in this
struction and Resources segments.
context due to development and design mistakes necessitating modifications. This risk is minimized by a structured,
Project risks are essentially the principal performance risks in
multi-stage product creation process.
the Construction and Resources segments, especially as each
project has its own individual characteristics. Although we work
Thanks to our great innovative strength and transparent
on the assumption that our projects are costed with due dili-
product creation process, we rate the risks in relation to
gence, the possibility cannot be definitively ruled out that, on
research and development as being currently medium.
finally billing the customer, lower earnings will ultimately be generated. As a result of the trend for projects to increase in size
Acquisition, sales and contract negotiations
and complexity, the resulting risks must be evaluated as of a
The risks of miscalculating quotations and of warranting
medium level.
technical characteristics which cannot be fulfilled are minimized
by the strict application of the dual-control principle, and can
Supplements and claims management
basically be regarded as low.
Especially in respect of complex construction works, we are
increasingly seeing parties resort to legal action when disputes
Materials management and procurement
arise in relation to contract interpretation as well as additional
Thanks to our long-standing and successful policy in our
works and supplements. Clients’ representatives are increas-
machinery manufacturing operations of planning well ahead to
ingly rarely authorized to resolve conflicts by mutual consent.
safeguard supplies of components which may be subject to
As a result, final project settlement is increasingly being delayed
bottlenecks, and based on additional measures we have taken
by legal action, and additional costs are being incurred. We
and on our ability to have time-critical components made within
manage this risk by professional management of supplemental
the Group in the event of a bottleneck, the risks in terms of
requirements in the course of the construction project, and
procurement currently remain classed as low. We also estimate
based on full documentation of the work carried out. Despite
the reliance on subcontractors or individual suppliers in the
all efforts, the outcomes of some negotiations on supplemen-
Construction and Resources segments as a low risk.
tal requirements pose a residual risk to the company. The risks
arising from supplemental requirements are rated as medium.
Production and order fulfillment
Technical failures arising from design errors or miscalculations
RISKS OF SUPPORTING PROCESSES
of statics in the project business can result in significant delays,
Information technology (IT)
both on the company’s own construction projects and on our
Security to prevent data loss or unauthorized access, as well
customers’ projects. In the BAUER Group, the risks resulting
as to safeguard system and data availability, is ensured by
from this represent an inherent component of our project
means of state-of-the-art hardware and software and building
business. Consequently, designs and statics are predominantly
services technology, so IT risks are classed as low.
produced in our own design bureaus by experienced employees. Consequently, we can assess the risks resulting
from this as low.
55
56
Accounting-related system of internal controls and risk
The individual Group companies and departments are
management
monitored and controlled on a monthly basis by the central
Consolidated accounting risks comprise risks in respect of
commercial departments in the respective segments and
accounting, valuation and recognition. To counteract them,
are then reviewed by Group Accounting further reducing the
the accounting functions of the parent company as well as of
accounting, valuation and reporting risks.
BAUER Spezialtiefbau GmbH, BAUER Maschinen GmbH and
BAUER Resources GmbH are managed centrally at headquar-
The consolidated figures are in turn checked on a monthly
ters in Schrobenhausen. This allows business transactions to
basis against the figures from the annual Group-wide planning
be handled in a standardized way.
process and analyzed on the basis of Group key performance
indicators (KPIs). Any necessary correction of non-conformance
The accounting functions for the other subsidiaries are usually
to plan is implemented promptly by the managers of the units
managed by decentralized in-house commercial departments.
concerned.
In this, our subsidiaries are assisted by external accountants
and auditors as well as by the investment controllers of BAUER
The annual financial statements and the year-end consolidated
Spezialtiefbau GmbH, BAUER Maschinen GmbH and BAUER
financial statements are audited by auditors in accordance
Resources GmbH, so as to ensure properly qualified financial
with the applicable legal requirements and standards, and are
reporting in accordance with the relevant national or interna-
reviewed by the Supervisory Boards established in the various
tional accounting regulations. Furthermore, statements are
business units as part of their duty of supervision. These
subjected to auditing in accordance with the relevant national
figures and information reports are regularly submitted to the
regulations.
Management Board and the Supervisory Board of BAUER AG
from Group Accounting function on a monthly basis.
In order to draw up the monthly Group reporting as well as
quarterly statements and the consolidated financial statements
The IT systems employed in these procedures are protected
according to international accountancy regulations (IFRS), the
by appropriate security systems against unauthorized access
subsidiaries use a uniform Group chart of accounts.
and data loss. Based on the systematic multi-segment structuring of the Group’s accounting process, with its redundant
The individual financial statements are drawn up either based
control instances, we are able to classify the resultant risks as
on an accounting guideline applicable throughout the Group
low.
or are applied to the regulations of the accounting guideline by
Group Accounting in the course of adjustment entries by the
OVERALL RISK
corresponding accountancy regulations in national law.
At present, no individual or aggregated risks can be detected
that could threaten the existence of the BAUER Group in the
At the major Group companies, the success of each individual
2016 financial year. The management sees no change in the
department is mapped as a central management instrument
overall risk situation, in view of future business prospects
by means of an expense distribution sheet. This reveals any
among other factors.
non-conformance to annual budgets. At project level, a monthly
reconciliation is carried out to cross-check the actual figures
against the cost accounting and site management budgets.
Our judgment and experience tells us that self-monitoring and
establishing dual control principles are the effective elements
of our system of internal controls.
OPPORTUNITY REPORT
The opportunities arising are classified in parallel with the
sector in particular benefits from an enormous need to catch
detailing of risks. In this context, too, the areas of opportunity
up with backlogs in the rising economic countries, but also
have been aggregated. Unless otherwise specified, all oppor-
in the established industrial nations. This applies not only to
tunities set out in the following relate to all our segments.
traffic infrastructure but also to residential and public buildings,
dams or flood protection facilities. Moreover, building is taking
STRATEGIC OPPORTUNITIES
place in urban areas where space is increasingly at a premium.
Over the years, the Group has built up expertise through
This demands progressively higher buildings, which calls for
handling projects in areas associated with its core business,
extensive foundation work. In addition, stationary and flowing
and has developed synergy effects from this which today
traffic must be ever-increasingly transferred below ground,
shape the Resources segment.
which also leads to growth in specialist foundation engineering.
These include the environmental technology business which
Opportunities for deep drilling technology have increased
deals with treating contaminated ground and groundwater,
further through the establishment of a joint venture with
and has taken on an increasingly international character since
Schlumberger. In the joint venture, a new generation of highly
its beginnings more than 20 years ago. A similar business
modern deep drilling rigs for use with oil and gas drilling rigs
grew out of the first use of specialist foundation engineering
in geothermal drilling will be developed and constructed for
equipment for diamond exploration. Today, bore holes are dug
Schlumberger and third parties. The partners involved, Bauer
for all kinds of natural resources. In the water business, we
and Schlumberger, anticipate that the joint venture could soon
also develop high-quality products for expanding wells and for
achieve revenues of more than EUR 100 million and open up
close-to-the-surface geothermal energy applications, as well
great opportunities for the future. Overall, we are convinced
as for treating and purifying drinking water, process water and
that deep drilling technology will make an important positive
industrial waste water.
contribution to our results in future.
By merging these three areas into the Resources business
In the Resources segment, we have succeeded in expanding
segment, we are addressing some of the most important
out of our traditional sphere of pollution remediation into indus-
issues of the 21st century. Moreover, the Resources segment
trial process water treatment, and thus attracting customers in
is less dependent on the economic cycles of our traditional
the automotive, chemicals, oil and gas industries. The demand-
Construction and Equipment segments.
ing quality requirements combined with large quantities of
industrial process waters occurring in oil production, against a
In order to bring about the internationalization of the Re-
background of ever more stringent environmental standards,
sources segment, we are utilizing the experience of our long-
offer additional outstanding market opportunities for our
standing organizational units in the other two segments.
products and services.
In the event of a regional market downturn, our network
VALUE CREATION OPPORTUNITIES
strategy in the Construction segment will enable us to relocate
Development and innovation
our capacities rapidly to another country and continue ope-
Development and innovation are systematically integrated into
rations at the new location. This leads to speed and cost
many standard processes within the Group. Their efficiency
advantages in our project business.
is monitored as part of the quality management system and
by way of the corporate controlling function. It is also ensured
MARKET OPPORTUNITIES
that customers’ wishes are understood as being opportunities,
Constantly increasing urbanization and growing infrastruc-
and are translated into innovations for our products and
tural needs are leading to increasingly large-scale building
services in a timely manner. The capacities of our engineering
schemes, which offer many interesting project opportunities
offices are systematically being strengthened by resources
to the construction industry – and especially the companies in
from countries with high levels of education allied to low labor
the specialist foundation engineering sector. The construction
costs, such as India.
57
Innovation is possible at practically every point within our
Supplements and claims management
business processes. Our employees are best placed to know
The assertion of requirements and supplements does not only
where improvements are achievable in their particular sphere
entails risks, but also the opportunity to achieve better earnings
of work. In order to collate and make use of the many good
than originally specified in the contract based on changes
suggestions which our employees submit, we have devised
to the ordered construction services or supplemental work
a system for the unbureaucratic recording, evaluation, imple-
ordered by the client. On projects involving high potential
mentation and rewarding of suggested improvements, which
for changes, this can result in a substantial improvement
has been in turn rewarded by a number of good ideas.
in earnings. We attempt to exploit such opportunities by
professional management of supplemental requirements in
Project opportunities
the course of the construction project.
Regardless of national and global market cycles, projects often
arise in otherwise weak markets which we as a corporation are
OVERALL OPPORTUNITIES
extremely well equipped to handle thanks to the mix of our
We are seeing a steady improvement in our opportunities on
products and services portfolio. Examples of this are processes
global markets as our Resources segment becomes increas-
for retrofitting of core seals in earthwork dams, or for the long-
ingly well established. This is also being boosted by new,
term, environmentally compatible treatment and disposal of
innovative products. Our strategy of systematically interlinking
industrial process water.
our mainly small and medium-sized globally operating units
to create efficient networks is enabling us more and more
>>>
58
The resultant projects in some cases entail very large lot units.
effectively to generate speed and cost benefits from the
When contracted, we are able to manage them successfully
associated economies of scale. All in all, we see the oppor-
by converging our global resources and based on our many
tunities for our Group’s worldwide business increasing once
years of experience in handling large-scale projects.
again in 2016.
In the Kingdom of Bhutan, on the banks of the Mangdechhu River, a new hydro-electric power station is being built. Bauer built
a total of 4,575 m² diaphragm wall so as to control the ingress of groundwater from the diverted river into the excavation pit.
Forecast Report
IX. FORECAST REPORT
As was already explained in the Business Report, the BAUER
in the future. The losses that have been made in some areas
Group operates in markets which display good underlying
were all caused by factors which do not represent a long-
growth rates. As a result of the enormous pent-up demand
lasting burden on the business – as is the case with the
for construction activities existing in the world, we are of the
significant amounts invested in the reorientation. In two
opinion that this situation will not change over the coming
projects in particular, some mistakes exacerbated by general
years, in spite of the turbulence that is affecting global
conditions led to significant losses which have imposed a
markets. Nevertheless, it will be necessary to respond to
burden on us for several years. To cope with the financial
shifts in the market focus by displaying great flexibility. For
crisis, we embarked on numerous relatively small business
example, it is to be expected that construction activities
operations post-2008 and continued them for some time
and, as a result, demand for new machinery in the oil and
despite the fact that, regrettably, they did not prove to be
gas-dependent markets will decrease in the next few years.
promising in some cases; and now we have been forced to
Both of these ought to increase in the established industria-
terminate them incurring significant costs.
lized nations, however, as a result of the positive effects of
low oil prices. These countries will be able to invest in new
The boom years of 2007 and 2008 obliged us to invest in
construction projects because their financial position will
expanding our capacities. The new plants were completed
have improved again.
just when the financial crisis broke. Since then, the market
situation and fiercer competition have prevented us from
Our excellent order backlog at the end of 2015 indicates that
achieving adequate capacity utilization. However, the deve-
we are successfully exploiting the opportunities presented by
lopment in sales over the past few years has already improved
the markets. Furthermore, there are many interesting major
the situation pleasingly, and the joint venture with Schlum-
projects all over the world which will enable us to maintain
berger for manufacturing deep drilling rigs represents a
this high level. In the Construction and Resources segments,
significant opportunity for us to achieve future success.
we are able to achieve relatively high order backlogs as a
result of the longer project durations.
Our business operations in Construction as well as in Equipment and in plant engineering offer the advantage in such a
The order backlog in the Equipment segment is rather
difficult phase that each project represents a new success
low, however. This is not set to change in coming years.
opportunity. Individual problems in the past are not carried
Equipment customers interested in special construction
forward into the future; in fact, they can even be seen as an
machinery tend only to order machines when they have a
opportunity because the experience is channeled into new
particular project to carry out. In addition, there is still significant
projects. As a result of our significant efforts to keep cost
overcapacity in the market – specifically among Chinese manu-
structures in our companies as lean as possible, our global IT
facturers – meaning that finished machines have to be stored
structure as well as the international experience possessed
awaiting sale. Given the short order lead times, it is difficult
by our management team, we believe we are well prepared
to accomplish equipment planning in line with future demand –
to lead the company into the future in combination with a
above all because components and parts have got to be
stable earnings trend. Our efforts in this regard are concen-
ordered several months ahead of production. We are respon-
trated on our innovative product range and our special
ding to this development with a corresponding platform
services with their prospects for future success.
strategy and appropriate standardization measures, and in
this way we are attempting to make production more flexible
In view of the general conditions, it is our opinion that our
and reduce the inventory level. We assume that this situation
business model will prove robust in 2016 as well. In our
will be a feature of our business for some time to come – even
planning, we have attempted to evaluate all known threats
though the Chinese manufacturers have now started to correct
and opportunities, thinking through both positive and negative
their strategy and cut capacities.
scenarios as effectively as possible. Overall, we are convinced
that our planning for 2016 is realistic. This applies to all
One important factor in the forecast is of course whether
failures in past years will influence the prospects of success
segments and to the Group overall.
59
Forecast Report
Nevertheless, we are obliged to point out that specialist
any major acquisitions at present, as we are intending to
foundation engineering and our other businesses are ex-
strengthen our capital base especially over the years ahead.
posed to greater risk than the business activities undertaken
by most other companies. Our activity always contains a
Based on the information available to us at the time of com-
factor that cannot be perfectly analyzed in advance – the
pleting this report, we forecast that total Group revenues
subsoil or the ground itself. Even after conducting extensive
for the 2016 financial year will be around EUR 1.65 billion.
and detailed preliminary ground surveys, some factors which
We forecast earnings after tax of about EUR 20 to 25
were not detectable will occur on a regular basis. They can
million and an EBIT of about EUR 75 million.
impede construction works in a wide variety of ways, and in
some cases also cause financial losses. We are continuously
We are continuing to plan for growth of between 3 % and 8 %
working hard to optimize our approach to risk, so as to avoid
in total Group revenues for the coming years.
the issues that have impacted on us over recent years.
Comparison: 2015 actual/2016 forecast
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60
Of course, an opportunity can also arise if the ground has
in EUR million
Actual 2015
Forecast 2016
been assessed too negatively prior to starting construction
1.656
~ 1.650
works. Our construction sites can then also generate additional
EBIT
90,7
~ 75
profit.
Net profit or loss
29,0
~ 20 - 25
We see no need to change our strategic objectives at present.
We still expect to make a loss in the first quarter, in line with
The strategy comprising the Construction, Equipment and
seasonal norms, though it will be balanced out over the
Resources segments will continue to dictate the direction
following quarters. The trend over the full year will thus be
of the Group over the coming years. We are not planning
in line with patterns in our business seen in earlier times.
In July 2015, BAUER Umwelt GmbH was appointed general contractor by Roche Pharma AG for the remediation of perimeters 1/3
north-west of the former Kesslergrube landfill. In the course of the remediation, work started on a temporary shipping pier on the River
Rhine in autumn 2015.
Forecast Report
The reason for this is that fewer machines can be invoiced at
exceptional results. We believe it is appropriate to allow our
the start of the year, because customers do not start buying
shareholders to participate in this, so we intend to pay a
equipment until the construction season gets underway. In
small dividend. The Management Board will thus recommend
the Construction segment, the winter period has a heavy
to the Supervisory Board that it propose a dividend of EUR
impact on a number of our markets.
0.15 (previous year: EUR 0.15) to the shareholders. In order to
reduce the burden on the capital base of BAUER AG which
Our balance sheet ratios have changed markedly over recent
is making the dividend payment, it has not been possible to
years. This is illustrated most clearly by the increase in working
increase the dividend in spite of the fact that higher earnings
capital, which also resulted in a substantial increase in net
after tax were achieved in the Group. In the medium term,
debt. This trend was largely attributable to the normalization
the dividend quota should be about 25 to 30 % of the
of our machinery business, in which inventories increased
reported earnings after tax.
significantly due to the return of shorter lead times. No significant change to the balance sheet structure is to be ex-
We do not see any existential risk or relevant risk to future
pected in the coming year, as our business model is tied to
progress in our trading environment. The global economy
high levels of up-front financing. With stronger demand for
remains marked by great change, however, which may also
machinery, however, the ratios will improve again. Over the
have a negative impact on our situation again. We should
coming years, we will be making great efforts to increase our
point out that future forecasts are based on assumptions and
equity ratio back to more than 30 %.
estimates of the company management. These assumptions
and estimates always entail a degree of uncertainty and risk,
Following the difficult financial year in 2015, the earnings
which may mean that actual performance differs from that
after tax in the Group could only be achieved by means of
forecast.
Schrobenhausen, March 31, 2016
Prof. Thomas Bauer
Chairman of the Management Board
Dipl.-Betriebswirt (FH) Hartmut Beutler
Dipl.-Ing. Heinz Kaltenecker
61
62
The Bauer Share
Global economy stable despite numerous crises
All that is left are low interest rates. The European Central
2015 was a crisis-ridden year in many aspects with the
Bank is sticking to its low interest policy and even has
Russia/Ukraine conflict, China's problems, the oil price
extended the bond purchasing program. The US Federal
situation, Brazil's issues, currency fluctuations, international
Reserve increased the Fed Rate by 0.25 % at year-end.
terrorism and the wave of refugees, and all of these topics
However, this cannot yet be regarded as the start of an
have a major impact on global developments.
interest rate turnaround, but rather as pressure to have to
deliver on the Federal Reserve's own announcements.
It is almost a miracle that the global economy is withstanding
all of the problems. It grew very steadily by 3.1 % in 2015.
Bauer share rises in a positive stock market environ-
The US market showed positive development as well as
ment
the Eurozone, which grew by 1.6 %. However, there is also
The Bauer share developed relatively positively in 2015, rising
another side: Russia suffered severely under the sanctions
by 30.3 % during the course of the year. This performance is
and the depreciation of the ruble and the economy shrank
roughly on par with the SDAX (+26.6 %). The DAX (+9.6 %),
by 3.7 %. China's weak economy created uncertainty at
on the other hand, fell behind.
stock exchanges around the globe. Growth in this country
dropped to a mere 6.9 %, with forecasts indicating a con-
Based on the opening price of EUR 13.35, the share gained
tinuing downward trend.
in the first weeks, reaching an interim high at EUR 18.00 in
mid-March. After a short sideward move, the share followed
The oil price slumped severely by almost 35 % in 2015. The
the general stock market trend as from mid-April and dropped
surplus in the market negatively affected the major oil com-
below the EUR 15 mark by mid-June.
panies and equipment suppliers alike as well as those countries depending on oil, especially in South America and the
The Bauer share was removed from the SDAX effective June
Middle East.
22. Both market capitalization and liquidity were no longer
sufficient for a listing on this index.
Despite the stable development in Europe, political tension
has increased in this region. The influx of refugees provoked a
The share recovered quickly from mid-June to mid-July and
return to national demarcation, which triggered discussions
reached a second interim high at EUR 17.72. The indices went
about open borders and the joint currency.
through a serious slump in August, which also impacted the
Performance of the Bauer Share 2015
BAUER AG
in %
DAX
MDAX
SDAX
50
40
30
20
10
0
(10)
(20)
(30)
01.01.2015
01.04.2015
01.07.2015
01.10.2015
31.12.2015
31.03.2016
THE BAUER SHARE
Bauer share. The share had dropped to a mere EUR 14.29 on
Share information
August 24.
ISIN / WKN
DE0005168108 / 516810
Trading symbol
B5A
During the subsequent recovery, the share made a clear break
Trading segment
Frankfurt, Prime Standard
from the indices and gained significantly, reaching the annual
Share indexes
CDAX, GEX, DAXPlus Family
high at EUR 19.20 at the end of October.
Class of share
No-nominal-value individual bearer shares
Share capital
EUR 73,001,420.45
The share then fell slightly again until year-end. During the
Number of shares
17,131,000
last trading days, it fell below the EUR 18 mark and closed
Shareholder structure
Bauer family 48.19 %, free float 51.81 %
the year at EUR 17.40.
Continuous exchange with stakeholders
Dividend policy
Investor relations primarily focus on continuous communication
Our dividend strategy is fundamentally oriented to the goals
with the capital market and shareholders.
of providing shareholders with an appropriate and fair participation in the success of the business, maintaining continuity,
In particular, the Management Board participates in road-
and safeguarding the equity ratio.
shows such as in Scandinavia, USA and Germany. The
members of the Management Board also talk to German
2015 was yet another difficult financial year. The budgeted
and foreign investors at capital market conferences.
earnings after tax were only generated through exceptional
results, with numerous expenses on the opposite. We believe
The number of analysts reporting on Bauer dropped to four
it is appropriate to allow our shareholders to participate
by the end of 2015. The reason for this development were
in this, so we intend to pay a small dividend.
the banks' restructuring measures and the share's exit from
the SDAX. All analysts recommended to hold the share at
The Management Board will thus recommend to the Super-
year-end, and the average target price was EUR 17.50.
visory Board that it propose a dividend of EUR 0.15 (previous
year: EUR 0.15) to the shareholders at the Annual General
Particularly our private shareholders used the Annual General
Meeting on June 23, 2016.
Meeting in June to obtain information from Prof. Thomas Bauer.
Around 400 shareholders and guests attended the meeting
in Schrobenhausen.
More information:
http://ir.bauer.de
KEY FIGURES
2012
2013
Earnings per share (in EUR)
1.44
Dividend per share (in EUR)
0.30
Dividend total (in EUR ’000)
5,139
Year-end price (in EUR)
19.32
18.81
Annual high (in EUR)
26.50
Annual low (in EUR)
16.13
Market capitalization at year-end (in EUR ’000)
Average daily trading volume (units)
2015
0.85
1.73
0
0.15
0.15 *
0
2,570
2.570 *
13.35
17.40
23.05
20.04
19.20
17.33
11.75
13.85
330,971
322,234
228,699
298,079
48,584
39,017
26,984
25,570
* Proposed; subject to the consent of the Annual General Meeting to be held on June 23, 2016
-0.99
2014
63
64
Corporate Governance Report
AND DECLARATION ON CORPORATE GOVERNANCE
The Management Board, also on behalf of the Supervisory
3. The individualized disclosures of the benefits, the remune-
Board, submits the following report on the company's
ration and the retirement benefits awarded to each member
Corporate Governance in accordance with Article 3.10 of
of the Management Board are not individualized for each
the German Corporate Governance Code. The Corporate
member of the Management Board in the remuneration
Governance Report also includes the Declaration on
report as the Annual General Meeting dated June 30, 2011
Corporate Governance pursuant to Article 289a of the
resolved on the omission of the disclosures according to
German Commercial Code (HGB), which forms part of
section 285, no. 9, letter a, sentences 5 to 8, section 315a,
the Management Report for the 2015 financial year.
subsection 1 and section 314, subsection 1, no. 6, letter a,
sentences 5 to 8 of the German Commercial Code (HGB)
Declaration of Conformity 2015
and therefore the disclosures required under Article 4.2.5
In the year under review, based on preliminary work by the
would contradict such Shareholder resolution.
Presidial and Personnel Committee, the Management Board
and Supervisory Board reviewed the company's compliance
4. Contrary to Articles 5.1.2 and 5.4.1, no age limit for mem-
with the German Corporate Governance Code. On December
bers of the Management Board or Supervisory Board and
8, 2015 the Management Board and Supervisory Board
no time limit to the length of membership in the Supervisory
passed the following declaration of conformity:
Board are specified. Expertise and performance as well as
independence cannot be determined on the basis of rigid
"Since the last declaration in December 2014 the company
age limits or length of membership. Upon the appoint-
has complied with, and currently complies with, each of the
ment of new Management Board and Supervisory Board
recommendations of the "Government Commission of the
members or upon prolongation of their membership at
German Corporate Governance Code" as published by the
the end of the statutory term of office, the persons in the
German Federal Ministry of Justice in the official section of
Supervisory Board and the Annual General Meeting who
the electronic version of the German Federal Gazette ("Bun-
bear responsibility for selecting suitable members will take
desanzeiger"), with the following exceptions:
account of the age and the independence of the chosen
person when reaching their decision, alongside assessing
1. Contrary to Article 3.8 an excess of at least 10 percent of
their skills.
the loss up to at least an amount representing one and
a half times the fixed annual remuneration of Supervisory
5. Contrary to Article 7.1.2, the consolidated financial state-
Board members is not agreed for D&O insurance for the
ments at December 31, 2014 were made public within
Supervisory Board. As a result of the moderate remunera-
100 days rather than 90 days of the end of the financial
tion provisions for the Supervisory Board in the Articles of
year. As a result of the international structure of the Group,
Association, a corresponding excess for the Supervisory
the completion and consolidation of the separate financial
Board is not approved. Even without a corresponding
statements takes a considerable amount of time. In the
excess, the Supervisory Board members will perform
interests of conscientious accounting processes, efforts
their duties responsibly.
to improve the accounting procedures continue.
2. Contrary to Article 4.1.5, there is no appropriate inclusion
Furthermore, BAUER Aktiengesellschaft already conforms
or participation of women arranged for in the filling of
largely to the additional suggestions of the German Govern-
management positions. In particular, the introduction of
ment Commission on the Corporate Governance Code.
a quota for women is not supported in order to ensure
equal opportunities. These positions should be filled
Roles of the Management Board and Supervisory
regardless of gender so that neither the female gender
Board
nor the male gender is favored or discriminated against. In
German company law prescribes a dual system of manage-
addition, a candidate should not suffer any disadvantage
ment for BAUER AG, characterized by a strict separation of
on the grounds of racial or ethnic origin, religion or belief.
personnel between the Management Board as the executive
CORPORATE GOVERNANCE REPORT
management body and the Supervisory Board as the super-
consolidated financial statements and the parent company
vising body. Moreover, the company's Articles of Association
and Group Management Report, as well as proposals for
and the rules of procedure governing the work of the Super-
the appropriation of net profit available for distribution. The
visory Board and of the Management Board also lay down the
Chairman of the Supervisory Board coordinates the work of
basic structures of their collaboration.
the Supervisory Board, chairs its meetings and represents
the Supervisory Board externally. The Supervisory Board
The Management Board is assigned independent responsibility
regularly reviews the efficacy of its activities.
for managing the company. Notwithstanding the joint overall
responsibility of the Management Board, each member of
Composition of the Supervisory Board
the Management Board acts on his or her own responsibility
The Supervisory Board of BAUER AG comprises 12 members,
within his or her assigned portfolio of functions. Measures and
with half of them being appointed by the employees and the
transactions of a division of the Management Board that are of
other half by the Annual General Meeting. The Supervisory
extraordinary importance for the company or a business unit,
Board includes a sufficient number of independent members
or which are associated with an extraordinary financial risk,
who have no business or personal links to the company, to
require the prior approval of the entire Management Board.
its executive bodies, to any controlling shareholder or to any
The Chairman of the Management Board coordinates the work
company associated with any such shareholder which may
of the Management Board. The Management Board members
give grounds for a material and not merely temporary conflict
report on a regular basis to the Chairman of the Management
of interests. Moreover, all members of the Supervisory Board
Board in respect of all material matters and on the course of
are obligated to immediately disclose to the Supervisory Board
business within their assigned functions. A member of the
any conflicts of interest as and when they arise. No conflicts of
Management Board has been appointed Labor Director, and
interest were disclosed to the Supervisory Board by any of its
is responsible to an increased extent for human resources and
members during the year under review.
social policy topics in the company. The Management Board
defines the corporate strategy, agrees it in consultation with
The Supervisory Board of BAUER AG currently comprises two
the Supervisory Board, and ensures that it is implemented.
women and 10 men. In the future, however, the Supervisory
The Management Board provides the Supervisory Board and
Board of a listed company will have to be comprised of at
its subcommittees with regular, detailed information, in written
least 30 % women and at least 30 % men pursuant to Section
form by way of monthly reports, by conference calls and at
92 (2) of the German Stock Corporation Act (Aktiengesetz;
routine meetings, as well as at extraordinary meetings held as
AktG) The shareholders and employee representatives both
and when required, in respect of all matters of relevance to the
rejected the total fulfillment of this gender quota, so that the
company.
minimum quota for the elections to the Supervisory Board
of BAUER AG due in the first half of 2016 must be fulfilled
The Supervisory Board appoints the Management Board.
separately by the shareholders and the employees.
In doing so, it considers not only the relevant professional
qualification of its members but also – given the international
Objectives of the Supervisory Board with regard to its
nature of the business – the diversity of its composition. The
composition
Supervisory Board also sets the overall level of remuneration
The following objectives must be taken into account by the
paid to the Management Board, regularly reviews remunera-
Nominations Committee and by the Supervisory Board when
tion levels, and specifies the remuneration paid to individual
proposing candidates for election to the Supervisory Board
members of the Management Board. It appoints, supervises
at the Annual General Meeting:
and advises the Management Board, and participates in
decisions of fundamental significance to the company. The
• The Supervisory Board shall be composed such that
company's Articles of Association stipulate relevant transac-
its members collectively possess the necessary skills,
tions and undertakings which require the consent of the
knowledge and professional experience to carry out its
Supervisory Board. Duties of the Supervisory Board include
assigned role in a correct and proper manner.
reviewing the annual financial statements of the company, the
65
66
• The appointment of shareholders' representatives to the
The Presidial and Personnel Committee comprises the
Supervisory Board shall take due account of the Group's
Chairman of the Supervisory Board as well as one Supervi-
fundamental character as a family business, giving due
sory Board member elected by the shareholder representa-
consideration to the implications of that character in terms
tives and one by the employee representatives respectively.
of the corporate culture, whereby two members shall be
Its role includes preparing the way for Supervisory Board
appointed from the Bauer family, provided the candidates
decisions relating to the setting of overall remuneration to
are suitable.
individual Management Board members and to the remuneration system for the Management Board in general, as well
• At least two of the shareholders' representatives on the
as responsibility for establishing, amending and terminating
Supervisory Board shall have substantial experience in the
service contracts with the members of the Management
management of construction and/or construction machinery
Board. It also discusses corporate governance matters.
manufacturing companies.
The Audit Committee comprises three members elected by
• At least one of the shareholders' representatives on the
the Supervisory Board by a majority of the votes cast, with two
Supervisory Board shall possess specialist skills and ex-
members proposed by the Supervisory Board members of the
perience in the application of financial reporting standards
shareholders and one member proposed by the Supervisory
and the implementation of internal control procedures.
Board member of the employees. The Chairman of the Audit
Committee is elected by the Supervisory Board at the sugge-
• The employees' representatives on the Supervisory Board
stion of the shareholders' representatives. The Chairman of
will be elected in accordance with the provisions of the
this committee is an independent member of the Supervisory
German Employees' Co-determination Act.
Board possesses specific knowledge and experience in the
application of accounting policies and audit procedures, and
• The Supervisory Board shall include not more than four
is neither a former member of the company's Management
members in total who have business or personal links to
Board nor the Chairman of the Supervisory Board. The role
BAUER AG, to its executive bodies, to any controlling
of the Audit Committee is in particular to monitor accounting
shareholder or to any company associated with any such
procedures and to review the efficiency of the system of
shareholder which may give grounds for a material and
internal controls, the risk management system and the internal
not merely temporary conflict of interests.
auditing system including compliance. The Audit Committee
prepares the proposal of the Supervisory Board to the Annual
• Supervisory Board posts shall be filled on merit, regardless
General Meeting concerning the appointment of auditors, and
of gender so that neither men nor women are preferred or
assess their independence. It undertakes a preliminary review
disadvantaged. Moreover, when appointments are made to
of the annual financial statements of the parent company
the Supervisory Board, a candidate shall not be disadvanta-
and the consolidated financial statements of the Group
ged for reason of race, ethnic origin, religion or world view.
together with the Combined Management Report, as well as
preparing the proposal on appropriation of net profit available
The objectives are fully embodied in the current composition
for distribution and consulting on the audit reports with the
of the Supervisory Board.
auditors. It also reviews the interim reports.
Composition and roles of the subcommittees
The Nominations Committee comprises three shareholder
The Supervisory Board has established four standing commit-
representative members of the Supervisory Board. The Chair-
tees constituted from among its members. The Supervisory
man and the Deputy Chairman of the Nominations Committee
Board subcommittees and their roles and procedures are laid
are proposed and elected by the Supervisory Board members
down in the rules of procedure governing the Supervisory
of the shareholders. The task of the Nominations Committee
Board. The chairmen of the various committees submit regular
is to submit to the Supervisory Board proposals of suitable
reports on their work to the plenary Supervisory Board
candidates to be put forward to the Annual General Meeting
meetings.
for election to the Supervisory Board.
The Mediation Committee, constituted pursuant to the
An appropriate system of risk management and of internal
German Co-determination Act, comprises two shareholder
controls is established within the company. The essential
representative and two employee representative members
features of the control and risk management system are
respectively. The Mediation Committee is only convened
set out in the Risk Report forming part of the Combined
if a proposed candidate for appointment as a member of
Management Report. Internal auditing systems monitor
the Management Board has not obtained the majority vote
compliance with laws and standards across the Group. The
required by the German Co-determination Act.
Management Board regularly updates the Supervisory Board
on existing risks and risk trends, as well as on internal auditing
In his report to the Annual General Meeting, the Chairman
procedures.
of the Supervisory Board summarizes the work of the
Supervisory Board and its subcommittees over the past
SHAREHOLDERS AND TRANSPARENCY
financial year. The Report of the Supervisory Board for the
The company provides regular and timely information relating
2015 financial year is published in the company's Annual
to the position of the company and in respect of material
Report on pages 68 to 69. This report is thereby quoted by
changes to the business. The company's website contains
way of reference.
comprehensive information (particularly the interim reports and
annual financial statements as well as Annual General Meeting
Determination of the female quota in the Management
documentation). In addition, electronic distribution systems
Board and executive levels
and the German Federal Gazette ("Bundesanzeiger") are
The Supervisory Board determined a female target quota of 0
used to ensure timely communication with our shareholders
% for the Management Board until June 30, 2017. This target
and with the public at large.
has been met by the current Management Board structure.
The Management Board specified a female target quota
The Annual General Meeting passed a resolution, with
of 22.2 % rounded in the top executive level beneath the
the necessary three-quarters majority, stipulating that the
Management Board until June 30, 2017 and 27.3 % rounded
remuneration paid to members of the Management Board
until June 30, 2017 for the second executive level beneath
shall not be disclosed individually. Consequently, as has
the Management Board. These targets were also fulfilled at
been the policy to date, only the remuneration paid to
the end of the reporting year. The statutory provisions on
the Management Board in total and the structure of the
determining the targets are regarded as critical for reasons
remuneration system are disclosed in the Remuneration
of equal opportunity.
Report on pages 45 to 47 of the company's Annual Report.
Corporate Governance and Compliance
Members of the Management Board at the year-end held a
The company's system of corporate governance is based
total of 1,742,022 (previous year: 1,742,022) shares in the
on German law, specifically on legislation governing public
company as per December 31, 2015. This corresponded
limited companies, corporate co-determination and capital
to 10.17 % (previous year: 10.17 %) of the share capital of
markets, as well as on the company's Articles of Association.
BAUER AG. On the same date, members of the Supervisory
The company's Articles of Association are published on the
Board held a total of 1,310,531 (previous year: 1,310,531)
company website at www.bauer.de, in the "Investor Relations"
Bauer shares, corresponding to 7.65 % (previous year: 7.65 %)
section under "Corporate Governance". The Management
of the company's share capital. No company share option
Board employs the Corporate Management Manual imple-
schemes or similar stock incentive programs existed during
mented throughout the Group as its central instrument of
the past financial year.
management. This manual also stipulates the framework
guidelines and management principles applicable for the
Group as well as its basic values. A code of conduct has
also been published on the company's website to ensure
that all BAUER Group employees conduct themselves in
compliance with the rules.
67
68
Report of the Supervisory Board 2015
The Supervisory Board regularly monitored the work of the
subsidiaries. The current business performance, order backlog
Management Board during the 2015 financial year on the
development and development in the markets in the Con-
basis of the detailed reports provided by the Management
struction, Equipment, and Resources segments as well as
Board in written and verbal form, and provided support in
the strategic alignment were discussed at all Supervisory
the form of advice. The Management Board discharged its
Board meetings.
duties to provide the Supervisory Board with regular, prompt
and comprehensive information about all questions of strategy,
At the annual financial review meeting in April relating to the
planning, company development, risk development and
annual parent company and consolidated financial statements
compliance that are relevant to the company and the Group.
for the 2014 financial year, also attended by the auditors, a
Between the meetings, the Management Board submitted
detailed review was undertaken of the respective financial
monthly written reports on all important business transactions
statements and associated management and audit reports,
and financial indicators of the Group and the company. The
taking into due consideration the report from the Audit
Chairman of the Supervisory Board was also in regular contact
Committee, and the proposal of the Management Board with
with the Management Board, and gathered information as
regard to the appropriation of earnings. At the same meeting,
appropriate relating to the course of business and key
the Supervisory Board also discussed compliance with
transactions.
financial performance indicators specified in loan agreements,
the year-end forecast, and the invitation to the Annual General
In their subcommittees and plenary sessions, the Supervisory
Meeting. The remuneration of the Management Board and
Board members always had the opportunity to scrutinize the
extension of the term of office of Prof. Dr-Ing. E.h. Thomas
reports and proposals submitted by the Management Board
Bauer, member of the Management Board, was also on the
and to set forth their own suggestions. In particular, the Super-
agenda, and the efficiency review was performed with a
visory Board intensively discussed all business transactions
positive outcome.
important for the company on the basis of written and verbal
reports from the Management Board, and examined them
At the second meeting in the financial year, the Supervisory
with regard to plausibility.
Board focused on business performance, determined a target
percentage of female members of the Management Board
There were no indications of conflicts of interest among
and discussed the gender ratio of the Supervisory Board.
members of the Management Board or Supervisory Board
requiring immediate notification of the Supervisory Board and
The opportunities and risks related to the conclusion of a joint
disclosure to the Annual General Meeting. There were no
venture with Schlumberger Group were discussed during the
changes of personnel on the Supervisory Board in the past
conference call. The September meeting dealt with matters
financial year.
such as various major projects, the deep drilling rig business
performance, and the internal control system. The expected
Main focus of consultations in Supervisory Board
development of earnings was also discussed. The participants
meetings
approved the medium-term plan with regard to the consolida-
Four regular plenary meetings and one conference call were
ted balance sheet.
held during the reporting year. Apart from Mr. Feiger, who
attended less than half of the meetings, all members of the
At the last Supervisory Board meeting in December of the
Supervisory Board attended all of the meetings of the Super-
reporting year, the members particularly discussed the con-
visory Board.
solidation measures in the Resources segment, the joint
venture with Schlumberger, and the tender for the audit of
Several times last year, the Supervisory Board discussed the
financial statements. An updated declaration of conformity to
enforcement of supplementary claims for major projects and
the German Corporate Governance Code was passed, and
the development of earnings in the segments and individual
approval was given to the employee bonus framework.
REPORT OF THE SUPERVISORY BOARD
Work carried out by the subcommittees
were certified by the auditors without reservation. The Audit
There were four committees of the Supervisory Board. The
Committee subjected the audit documentation and reports
Mediation Committee and the Nominations Committee were
to thorough scrutiny. The Committee reported on its review
not required to convene. The chairpersons submitted regular
to the Supervisory Board. The auditors attended the meeting
reports on the main content of the subcommittee meetings
of the Audit Committee as well as the annual financial review
to the plenary Supervisory Board meetings. The meetings of
meeting of the plenary Supervisory Board.
the various subcommittees of the Supervisory Board in the
financial year were attended by all the respective members.
The audit documentation and reports from the auditors were
provided to all members of the Supervisory Board in good
Two meetings of the Presidial and Personnel Committee were
time for scrutiny. The Supervisory Board duly noted and
convened as well as one conference call. At those meetings,
concurred with the findings of the auditors' review of the
preparations were made for the decision of the Supervisory
parent company and Group consolidated financial statements
Board relating to the setting of the salaries and performance
and the Combined Management Report. On conclusion of the
bonuses of the members of the Management Board and to
Supervisory Board's review, no objections were raised. The
the structuring of its remuneration system, as well as to the
annual financial statements of BAUER AG and the con-
performance bonus framework. Consideration was also given
solidated financial statements of the Group were approved
to the declaration of conformity to the German Corporate
by the Supervisory Board at its financial review meeting on
Governance Code, the appointment of managing directors
April 13, 2016. The annual financial statements of BAUER
at the subsidiaries, the extension of the contract of service
AG were thereby confirmed. Following prior consultations
of Management Board member Prof. Dr.-Ing. E.h. Thomas
by the Audit Committee, the Supervisory Board concurred
Bauer, and the succession plans for the Management Board.
with the proposal of the Management Board regarding the
appropriation of net profit available for distribution.
The Audit Committee held two conference calls and three
meetings in the financial year. The committee reviewed the
On behalf of the Supervisory Board, I would like to thank
audit of the interim reports and, in the presence of the
the members of the Management Board, all the Group's
auditors, the audit of the annual financial statements of the
employees and the employee representatives within all Group
parent company and the consolidated financial statements
companies for their great commitment throughout the past
of the Group. It also scrutinized the Management Board's
financial year.
proposal regarding the appropriation of earnings. It also
prepared the appointment of the auditor, taking account of
the examination into the latter's impartiality. The strategy in
Schrobenhausen, April 2016
the segments was also discussed, the risk management
The Supervisory Board
and Internal Audit reviewed, and improvements to the ethics
management system considered.
Auditing of 2015 annual and consolidated financial
Dr. Klaus Reinhardt
statements
Chairman of the Supervisory Board
The annual financial statements of BAUER AG to December
31, 2015 and the consolidated financial statements of the
Group, as well as the Combined Management Report, including the Group accounts, were audited by the auditors
elected by the Annual General Meeting and duly appointed
by the Supervisory Board, PricewaterhouseCoopers AG und
Wirtschaftsprüfungsgesellschaft, Stuttgart. The accounts
69
71
Balance sheet and income statement of
BAUER Aktiengesellschaft in accordance
with HGB (German Commercial Code)
Income statement of BAUER Aktiengesellschaft
73
Balance sheet of BAUER Aktiengesellschaft as at december 31, 2015
2015
CONSOLIDATED FINANCIAL STATEMENTS
72
The island nation of Mauritius is getting a new dam for a water storage reservoir, which will safeguard drinking water supplies.
Almost exactly a year to the day after work started on the EUR 35 million Bagatelle dam project, Bauer built the last panel of the
cut-off wall in May 2015.
72
Income statement of
in EUR ’000
1.
Sales revenues
2.
3.
Other operating income
4.
Cost of materials
5.
Personel expenses
6.
Amortization of intangible assets and depreciation of property, plant and equipment
7.
Other operating expenses
Operating result
8.
Income from participations
9.
Other interest and similar income
12M/2014
12M/2015
30,046
32,065
8
0
5,749
5,013
35,803
37,078
-1,052
-1,056
-15,450
-16,553
-2,874
-2,875
-16,667
-47,693
-36,043
-68,177
-240
-31,099
4,950
3,960
7,950
9,949
-5,914
-6,988
Financial result
6,986
6,921
Result from operating activities
10. Interest and similar expenses
6,746
-24,178
11. Extraordinary expenses
-141
-141
12. Income tax expense
-666
-826
13. Other taxes
14. Net result for the year
15. Profit carried forward
16. Dividend payment
17. Net earnings available for distribution
-18
-19
5,921
-25,164
27,429
33,350
0
-2,570
33,350
5,616
73
Balance sheet of BAUER Aktiengesellschaft
as at december 31, 2015
Assets
A.
Fixed assets
I.
Intangible assets
II.
Property, plant and equipment
III.
Financial assets
B.
Current assets
I.
Inventories
Raw materials and supplies
II.
Receivables and other assets
(of which receivables from affiliated companies)
III.
Cash at banks
Dec. 31, 2014
2,616
Dec. 31, 2015
3,693
3,557
5,808
116,646
116,745
122,819
126,246
71
44
205,920
(204,598)
198,682
(197,556)
960
273
206,951
198,999
Prepayments and deferred charges
641
1,061
D.
Deferred tax assets
603
1,080
331,014
327,386
Dec. 31, 2014
Dec. 31, 2015
2015
C.
in EUR ’000
in EUR ’000
A.
Equity
I.
Subscribed capital
73,001
73,001
II.
Capital reserve
39,781
39,781
III.
Revenue reserves
15,100
15,100
IV.
Unappropriated net profit
(of which profit carried forward: EUR 33,350 thousand; previous year: EUR 27,429 thousand)
33,350
5,616
161,232
133,498
7,841
(6,600)
9,662
(8,165)
161,941
(34,942)
184,226
(38,543)
331,014
327,386
B.
Provisions
(of which provisions for pensions)
C.
Liabilities
(of which liabilities payable to affiliated companies)
75
Consolidated income statement
76
Consolidated statement of comprehensive income
77
Consolidated statement of cash flows
78
Consolidated balance sheet at december 31, 2015
80
Consolidated statement of changes in equity
81
Notes to the consolidated financial statements
81
General notes
106
Segment reporting
108
Explanatory notes to the income statement
113
Explanatory notes to the balance sheet
142
Other disclosures
160
Major participations of the Group
164
165
Audit opinion
In Schonungen, a town in the Lower Franconia region of Bavaria, BAUER Umwelt GmbH and BAUER Spezialtiefbau GmbH worked
together on the decontamination of a hazardous waste site. The work took place over an area of about 11,500 m² and included soil
remediation work as well as special foundation work with replacement bores.
2015
76
Consolidated financial statements
in accordance with IFRS
76
Consolidated income statement and
consolidated statement of comprehensive income
Income statement
in EUR ’000
Appendix
12M/2014
12M/2015
(7)
1,375,679
1,378,991
26,622
28,994
1.
Sales revenues
2.
Changes in inventories
3.
(8)
14,696
22,748
4.
Other income
(9)
89,022
157,213
1,506,019
1,587,946
CONSOLIDATED REVENUES
5.
Cost of materials
(10)
-749,247
-752,532
6.
Personel expenses
(11)
-355,250
-376,118
7.
Depreciation and amortization
a) Depreciation of fixed assets
(12)
-78,781
-81,143
b) Write-downs of inventories due to use
(13)
-15,789
-13,195
(14)
-230,526
-274,235
76,426
90,723
8.
OPERATING RESULT (EBIT)
9.
Financial income
10. Financial expenses
(15)
7,096
4,972
(16)
-45,149
-41,982
11. Share of the profit or loss of associated companies accounted for using the equity method
EARNINGS BEFORE TAX
12. Income tax expense
(17)
NET RESULT FOR THE PERIOD
of which attributable to shareholders of BAUER AG
of which attributable to non-controlling interests
in EUR
-572
2,672
37,801
56,385
-22,075
-27,393
15,726
28,992
14,481
29,715
1,245
-723
12M/2014
Basic earnings per share
(18)
Diluted earnings per share
(18)
0.85
12M/2015
1.73
0.85
1.73
Average number of shares in circulation (basic)
17,131,000
17,131,000
Average number of shares in circulation (diluted)
17,131,000
17,131,000
12M/2014
12M/2015
Statement of comprehensive income
in EUR ’000
15,726
28,992
-32,264
6,543
9,046
-1,819
-5,323
1,024
6,497
-834
54
-53
Income and expenses which will not be subsequently reclassified to profit and loss
Revaluation of commitments arising from employee benefits after termination
of employment
Deferred taxes on that revaluation with no effect on profit and loss
Income and expenses which will be subsequently reclassified to profit and loss
Market valuation of derivative financial instruments
Included in profit and loss
Deferred taxes on financial instruments with no effect on profit and loss
Differences from currency translation
10,545
6,733
-11,445
11,594
4,281
40,586
of which attributable to shareholders of BAUER AG
2,360
40,891
of which attributable to non-controlling interests
1,921
-305
Other comprehensive income
Total comprehensive income
77
Consolidated statement of cash flows
in EUR ’000
12M/2014
12M/2015
Earnings before tax
37,801
56,385
Depreciation of fixed assets
78,781
81,143
Write-downs of inventories due to use
15,789
13,195
Financial income *
-7,096
-4,972
Other non-cash transactions and results of de-consolidations *
Dividends received
Result from the disposal of fixed assets
Result from associated companies accounted for using the equity method *
45,149
41,982
-50,853
-85,281
450
1,168
-4,773
-15,371
-572
2,672
314
1,474
Change in trade receivables
20,634
-38,763
Change in receivables from construction contracts
24,309
13,872
Change in provisions
Change in receivables from concession arrangements
2,309
0
Change in other assets and in prepayments and deferred charges
-10,506
4,648
Change in inventories
-37,316
-38,028
Change in trade payables
-21,114
13,174
18,551
16,874
Change in liabilities from construction contracts
Change in other current and non-current liabilities
22,776
-12,068
134,633
52,104
Income tax paid
-19,235
-19,679
Net cash from operating activities
115,398
32,425
-69,119
-82,027
26,854
53,803
Cash and cash equivalents generated from day-to-day business operations
Cash flows from investment activity:
Acquisition of property, plant and equipment and intangible assets
Proceeds from sale of fixed assets
Consolidation scope-related change in financial resources
Net cash used in investing activities
-5,187
-9,268
-47,452
-37,492
Cash flows from financing activity:
Raising of loans and liabilities to banks
202,306
213,371
-237,761
-159,173
-11,074
-7,804
0
610
-2,872
-3,143
-42,952
-38,593
5,462
3,851
Net cash used in financing activities
-86,891
9,119
Changes in liquid funds affecting payments
-18,945
4,052
Influence of exchange rate movements on cash
3,563
1,519
-15,382
5,571
Cash and cash equivalents at beginning of reporting period
57,217
41,835
Cash and cash equivalents at end of reporting period
41,835
47,406
-15,382
5,571
Repayment of loans and liabilities to banks
Repayment of liabilities from finance lease agreements
Disbursements for the acquisition of additional shares in subsidiaries
Dividends paid
Interest paid
Interest received
Total change in liquid funds
Change in cash and cash equivalents
* Previous year adjusted
2015
Financial expenses *
Cash flows from operational activity:
78
Consolidated balance sheet at
december 31, 2015
Assets
in EUR ’000
A.
NON-CURRENT ASSETS
I.
Intangible assets
Appendix
2. Capitalized software costs
3. Capitalized development costs
Dec. 31, 2015
(19)
1. Concessions, industrial property rights and similar rights and values and licenses
to such rights and values
II.
Dec. 31, 2014
10,156
9,350
39
11
24,245
18,094
34,440
27,455
206,576
184,232
804
784
206,209
187,313
25,107
26,365
(19)
1. Land, land rights and buildings
2. Investment property
3. Technical equipment and machinery
4. Other equipment, factory and office equipment
5. Payments on account and assets in course of construction
8,213
5,662
446,909
404,356
III.
Investments accounted for using the equity method
(19)
42,906
132,553
IV.
Participations
(19)
3,613
3,613
V.
Deferred tax assets
(20)
30,973
27,190
VI.
Other non-current assets
(21)
7,492
7,722
VII. Other non-current financial assets
B.
I.
(22)
15,355
618,244
155,334
155,718
CURRENT ASSETS
Inventories
(23)
1. Raw materials and supplies
2. Finished goods and work in progress and stock for trade
II.
28,420
594,753
283,850
288,911
439,184
444,629
1. Receivables from construction contracts (PoC)
132,159
129,478
2. Trade receivables
311,417
343,933
67
3,272
(24)
3. Receivables from enterprises in which the company
has participating interests
4. Payments on account
5. Other current assets
6. Other current financial assets
III.
Effective income tax refund claims
IV.
Cash and cash equivalents
(25)
4,304
5,364
28,603
33,381
20,100
28,901
496,650
544,329
2,661
2,300
41,835
47,406
980,330
1,038,664
1,575,083
1,656,908
79
Appendix
Dec. 31, 2014
Dec. 31, 2015
(26)
A.
EQUITY
I.
Subscribed capital
II.
Capital reserve
38,404
38,404
III.
Other revenue reserves and unappropriated net profit
287,903
327,437
Equity of BAUER AG shareholders
399,308
438,842
19,617
12,368
418,925
451,210
364,771
376,628
Non-controlling interests
B.
NON-CURRENT DEBT
I.
Liabilities to banks
II.
Liabilities from finance lease agreements
III.
Provisions for pensions
IV.
Other non-current liabilities
V.
Other non-current financial liabilities
VI.
Deferred tax liabilities
C.
CURRENT DEBT
I.
Liabilities
(27)
(28)
(20)
13,032
12,652
116,358
112,284
5,959
7,262
10,013
4,414
13,123
20,664
523,256
533,904
266,533
297,677
(29)
1. Liabilities to banks
2. Liabilities from finance lease agreements
3. Advances received for orders
4. Liabilities from construction contracts (PoC)
5. Trade payables
6. Liabilities to enterprises in which the company
has participating interests
7. Other current liabilities
8. Other current financial liabilities
II.
73,001
IV.
73,001
7,453
8,945
19,579
10,392
48,471
49,882
168,974
184,991
205
1,017
68,632
71,503
25,712
12,078
605,559
636,485
9,317
16,955
Provisions
1. Effective income tax obligations
2. Provisions
(30)
15,880
16,113
3. Current portion of provisions for pensions
(28)
2,146
2,241
27,343
35,309
632,902
671,794
1,575,083
1,656,908
2015
in EUR ’000
80
Consolidated statement of changes in equity
from january 1, 2014 to december 31, 2015
Other revenue reserves
and unappropriated net profit
in EUR ’000
Subscribed
capital
As at Jan 1, 2014
Capital
reserve
Revenue
reserves
Foreign
currency
translation
Hedging
transactions
reserve
Noncontrolling
interests
Total
73,001
38,404
294,686
-6,492
-2,593
22,809
419,815
0
0
14,481
0
0
1,245
15,726
Exchange differences on translation
of foreign subsidiaries
0
0
0
9,641
0
904
10,545
Revaluation of commitments arising
from employee benefits after termination of employment
0
0
-31,956
0
0
-308
-32,264
Market valuation of derivative financial
instruments
0
0
0
0
1,184
-10
1,174
Deferred taxes with no effect on profit
and loss
0
0
8,959
0
51
90
9,100
0
0
-8,516
9,641
1,235
1,921
4,281
Changes in scope of consolidation
0
0
0
0
0
-3,199
-3,199
Dividend payments
0
0
0
0
0
-2,872
-2,872
Other changes
0
0
-58
0
0
958
900
As at Dec. 31, 2014
73,001
38,404
286,112
3,149
-1,358
19,617
418,925
As at Jan. 1, 2015
73,001
38,404
286,112
3,149
-1,358
19,617
418,925
0
0
29,715
0
0
-723
28,992
Exchange differences on translation
of foreign subsidiaries
0
0
0
6,359
0
374
6,733
Revaluation of commitments arising
from employee benefits after termination of employment
0
0
6,487
0
0
56
6,543
Market valuation of derivative financial
instruments
0
0
0
0
186
4
190
Deferred taxes with no effect on profit
and loss
0
0
-1,804
0
-52
-16
-1,872
0
0
34,398
6,359
134
-305
40,586
Changes in scope of consolidation
0
0
-3,253
0
0
-1,079
-4,332
Dividend payments
0
0
-2,570
0
0
-573
-3,143
Other changes *
0
0
3,065
1,401
0
-5,292
-826
73,001
38,404
317,752
10,909
-1,224
12,368
451,210
As at Dec. 31, 2015
* Non-controlling interests were reclassified to revenue reserves in other changes due to system-related matters
81
Notes to the consolidated financial statements
GENERAL NOTES
GENERAL INFORMATION
BAUER Aktiengesellschaft, Schrobenhausen (referred to in the following as BAUER AG) is a stock corporation under German law.
Its registered office is at BAUER-Strasse in Schrobenhausen, and the company is entered in the Register of Companies of
its products and services all over the world. The operations of the Group are divided into three segments: Construction, Equipment and Resources.
BAUER AG is listed in the Prime Standard of the German stock market.
1. BASIS OF PREPARATION
The consolidated financial statements of BAUER AG were prepared applying section 315a of the German Commercial Code
(HGB) in accordance with International Financial Reporting Standards (IFRS), as applicable in the EU. The consolidated financial
statements were prepared on the basis of historical cost, limited by the market-value valuation of available-for-sale financial assets
and by the fair-value valuation of financial assets and liabilities (including derivative financial instruments) affecting net income.
The previous year's figures have been determined according to the same principles.
The BAUER Group's financial year is the calendar year.
The consolidated financial statements were prepared in euros. Unless otherwise specified, all amounts are quoted in thousands
of euros (EUR '000).
The income statement was prepared according to the nature of expenses method.
2. BASIS OF CONSOLIDATION
The basis of consolidation includes BAUER AG and all major subsidiaries. Subsidiaries are all companies over which the
parent has control in terms of financial and corporate policy. This is routinely accompanied by a voting rights share of over
50 %. When assessing whether control is exerted, the existence and effect of potential voting rights currently exercisable
or convertible are considered.
122 companies were consolidated into the Group’s annual financial statements in 2015 (previous year: 120). In the financial year,
six (previous year: none) companies were included in the basis of consolidation for the first time. Since the beginning of 2015, four
(previous year: four) companies were de-consolidated due to merger, sale and discontinuation of operations. Joint ventures are
not included in the number of consolidated companies due to the short-term nature of these projects.
2015
The BAUER Group is a provider of services, equipment and products dealing with ground and groundwater. The Group markets
Ingolstadt (HRB 101375).
82
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2015
The following overview shows the number of subsidiaries by segment (without construction joint ventures):
Main business
Headquarters
Number of companies with 100 %
share
Number of companies with a share
less than 100 %
Number of
associated
company
Dec. 31,
2014
Dec. 31,
2015
Dec. 31, Dec. 31,
2014
2015
Dec. 31, Dec. 31,
2014
2015
Total
Number of joint
ventures
Dec. 31,
2014
Dec. 31,
2015
Dec. 31,
2014
Dec. 31,
2015
Specialist Foundation Engineering, Project
Development
Global
27
28
8
8
12
12
0
0
47
48
Equipment
segment
Equipment
Manufacture
and Sales
Global
24
22
10
8
1
1
0
3
35
34
Resources
segment
Environment and
Environmental
Technology
Global
25
25
6
6
2
2
2
3
35
36
Central
services
Global
3
4
0
0
0
0
0
0
3
4
79
79
24
22
15
15
2
6
120
122
'Other'
segment
Total
If the quality assessment of a new subsidiary finds that the company is immaterial in terms of the operative segment or Group,
it may not be included in the consolidated financial statements.
Consequently, the non-inclusion of any one company must not result in material changes to the Group's net asset, financial and
earnings position, nor must it mask any other materially relevant trends.
In a small number of cases, companies are fully consolidated into the financial statements of BAUER AG even though that
company holds less than 50 % of their voting rights. This is the result of state restrictions which stipulate that foreign investors
may not hold more than 50 % of the voting rights in domestic companies. In such cases BAUER AG makes use of so-called
agency constructions, whereby more than 50 % of the voting rights are commercially held in the company concerned, thus
allowing for full consolidation.
Subsidiaries are included in the consolidated financial statements (fully consolidated) from the point at which control, or the
option of control, is transferred to the Group. They are de-consolidated at the point when control ends. Companies of which
BAUER AG is able, directly or indirectly, to exercise a significant influence on the said companies’ financial and operating policy
decisions (associated companies) are consolidated according to the equity method. This related to 15 companies as at
December 31 (in the previous year: 15). Joint ventures were likewise consolidated according to the equity method.
The main subgroups and companies included in the consolidated financial statements are listed in the Major Participations
section. The disclosures in accordance with Section 313, Subsection 2 HGB are grouped in a separate list of holdings. This will
be published as part of the Notes to the financial statements of BAUER Aktiengesellschaft in the electronic version of the official
Gazette (“Bundesanzeiger”) of the Federal Republic of Germany. Subsidiaries with differing balance sheet dates compile interim
financial statements as per the Group balance sheet date. NuBa Equipment Ltd. prepares its annual financial statements for
September 30 as Nuna Logistics Limited another shareholder, also prepares its annual financial statements for this date. BAUER
Corporate Services Private Limited, India, and BAUER Equipment India Private Limited prepare their annual financial statements
for 31 March due to local statutory requirements.
83
Changes at subsidiaries:
On September 15, 2015, SCHACHTBAU NORDHAUSEN GmbH outsourced the Structural Steel Engineering division to
SCHACHTBAU NORDHAUSEN Stahlbau GmbH. Up to this point, the Structural Steel Engineering division had been reported
On December 17, 2015, BAUER (NEW ZEALAND) LIMITED was discontinued and therefore de-consolidated.
Equipment segment
In the second quarter of financial year 2015, 100 % of the shares in BAUER Mexico S.A. de C.V. were sold to BAUER Resources
GmbH (97.5 %) and PURE Umwelttechnik GmbH (2.5 %). These companies are reported in the Resources segment. This sale
had no effect on the consolidated financial statements of BAUER AG.
On June 30, 2015, BAUER Cimentationes y Equipos S.A. was discontinued and therefore de-consolidated.
In the third quarter of financial year 2015, BAUER Maschinen GmbH acquired the remaining 10 % share in the non-controlling
interests of MAT Mischanlagentechnik GmbH and since then holds 100 % of the shares in MAT Mischanlagentechnik GmbH.
In addition, MAT Mischanlagentechnik GmbH, the transferor entity, was merged with BAUER Maschinen GmbH and discontinued
in the process. The company Immenstadt is continued under the name of MAT Mischanlagentechnik, a branch office of BAUER
Maschinen GmbH.
In the fourth quarter of financial year 2015, BAUER Equipment Australia Pty. Ltd. and BAUER Equipment India Private Limited
were included in the consolidated financial statements for the first time. The company was previously not consolidated owing to its
minor importance.
Also in the fourth quarter of 2015, BAUER Machinery USA Inc. was included in the consolidated financial statements.
Disposals
By agreement dated September 9, 2015, BAUER Maschinen GmbH sold 50 % of its shares in SPANTEC Spann- & Ankertechnik
GmbH to SPANTEC Invest GmbH, effective September 15, 2015.
2015
BAUER AG.
under the Equipment segment. This outsourcing had no other effect on the interim consolidated financial statements of
84
These are the effects of the sale:
a) Consideration received
in EUR ’000
Consideration received
Sep. 15, 2015
12,509
b) Disposal of assets and liabilities due to the loss of control
in EUR ’000
Sep. 15, 2015
Non-current assets
Intangible assets
448
425
Other non-current financial assets
47
4,592
Current assets
Inventories
1,304
3,960
2,143
Non-current debt
-253
-235
Current debt
Trade payables
Other current liabilities
Effective income tax obligations
Net assets sold
-1,066
-443
-256
10,666
c) Total effects from the sale of the shares in SPANTEC Spann- & Ankertechnik GmbH
in EUR ’000
Quid pro quo consideration received
Net assets surrendered
Sep. 15, 2015
12,509
-10,666
1,079
Fair value of the 40 % at-equity investment retained
10,200
Total income from the sale of shares
13,122
The total effect is not included in other income and stated separately in Article 9 as an effect of the de-consolidation and transition
consolidations.
85
d) Net outflow of cash and cash equivalents from the sale of the shares in SPANTEC Spann- & Ankertechnik GmbH
Sales price paid for with cash and cash equivalents
Sep. 15, 2015
0
Less: cash and cash equivalents disposed of as part of the sale
-2,143
Total net outflow of cash and cash equivalents disposed of as part of the sale
-2,143
The at-equity investment retained was measured at fair value due to the sale of the shares in SPANTEC Spann- & Ankertechnik
GmbH. The fair value was determined from the discounted transaction price for the shares at the time they were sold. This
method is part of level 3 of the fair value hierarchy stated in IFRS 13.
Cash capital increase
By notarization dated December 15, 2015, Schlumberger GmbH, Vechta acquired shares in BAUER Deep Drilling GmbH
as part of a cash capital increase and the share of BAUER Maschinen GmbH in share capital decreased to 51 % as a result.
The joint venture agreement states that all decisions regarding material activities require the approval of the shareholders.
It is therefore a joint venture which is to be accounted for using the at equity method. The net assets of BAUER Deep Drilling
GmbH were derecognized due to the loss of control and the retained shareholding recognized at fair value.
2015
These are the effects:
a) Disposal of assets and liabilities due to the loss of control
in EUR ’000
Dec. 15, 2015
Non-current assets
Intangible assets
4,166
97
3,536
Current assets
Inventories
217
1,221
153
Non-current debt
-406
-23
-36
Current debt
Trade payables
-233
-390
Other current financial liabilities
Net assets disposed
in EUR ’000
-510
7,792
86
b) Effect from the loss of control of BAUER Deep Drilling GmbH
in EUR ’000
Dec. 15, 2015
Net assets disposed
-7,792
36,064
Total effect
28,272
c) Changes in net cash and cash equivalents due to the cash capital increase
in EUR ’000
Cash and cash equivalents received
Dec. 15, 2015
0
Less: cash and cash equivalents disposed of
-153
Total net outflow of cash and cash equivalents
-153
The total effect is not included in other income and stated separately in Article 9 as an effect of the deconsolidation and transition
consolidations.
The at-equity investments retained in BAUER Deep Drilling GmbH were recognized at fair value. The fair value was determined
from the payment of the cash capital increase at the time of the transaction. This method is part of level 3 of the fair value
hierarchy stated in IFRS 13.
Cash contribution
By contract dated December 15, 2015, Schlumberger Technology Corporation, Houston, invested cash in BAUER Manufacturing
LLC, to acquire a share of 49 %. As a result, the share of BAUER Machinery USA Inc., in share capital decreased to 51 %. The joint
venture agreement states that all decisions regarding material activities require the approval of the shareholders. It is therefore a
joint venture which is to be accounted for using the at equity method. The net assets of BAUER Manufacturing LLC were
derecognized due to the loss of control and the retained shareholding recognized at fair value.
87
These are the effects of the cash contribution:
a) Disposal of assets and liabilities due to the loss of control
Non-current assets
26,630
Current assets
Inventories
14,613
237
7,558
Non-current debt
-7,629
-17
Current debt
-10,099
Liabilities from construction contracts (PoC)
-17,697
Trade payables
Net assets disposed
-5,470
-533
7,593
b) Effect from the loss of control of BAUER Manufacturing LLC
in EUR ’000
Dec. 15, 2015
Net assets disposed
-7,593
44,445
Foreign currency translation differences
Total effect
-488
36,364
c) Changes in net cash and cash equivalents due to the cash contribution
in EUR ’000
Cash and cash equivalents received
Dec. 15, 2015
0
Less: cash and cash equivalents disposed of
-7,558
Total net outflow of cash and cash equivalents
-7,558
The total effect is not included in other income and stated separately in Article 9 as an effect of the de-consolidation and transition
consolidations.
The at-equity investments retained in BAUER Manufacturing LLC were recognized at fair value. The fair value was determined
from the payment of the cash contribution at the time of the transaction. This method is part of level 3 of the fair value hierarchy
stated in IFRS 13.
Dec. 15, 2015
2015
in EUR ’000
88
Resources segment
On March 20, 2015, BAUER Resources Australia Pty. Ltd., was discontinued and de-consolidated.
In the first quarter of financial year 2015, BAUER Resources Maroc S.A.R.L, was included in the Group financial statements
for the first time. The company was previously not consolidated owing to its minor importance.
On August 28, 2015, BAUER Resources Hungary Kft. was discontinued and de-consolidated.
In the fourth quarter of financial year 2015, BAUER Resources Senegal S.A.R.L was included in the Group financial statements for the first time. The company was previously not consolidated owing to its minor importance.
'Other' segment
On December 7, 2015, BAUER Maschinen GmbH sold all of its shares in BAUER Mietpool GmbH to BAUER Aktiengesellschaft.
It was also resolved to re-name BAUER Mietpool GmbH to WW Beteiligung GmbH. BAUER Mietpool GmbH had been
reported under the Equipment segment until the date of the sale.
3. CONSOLIDATION POLICIES
The assets and liabilities of the German and foreign companies included in the consolidated financial statements are stated
according to the uniform accounting and valuation methods applicable throughout the BAUER Group. Mutual receivables
and liabilities as well as expenses and income between consolidated companies are eliminated. Consolidated inventories and
fixed assets are adjusted by existing intra-group balances. Consolidation affecting net income is subject to deferral of taxes,
with deferred tax assets and liabilities being offset against each other provided the payment period and tax creditor are the
same. In respect of subsidiaries consolidated for the first time, the identifiable assets, liabilities and contingent liabilities of the
acquired companies were recorded at their applicable fair values at the time of acquisition. Goodwill occurring on initial
consolidation is capitalized and subjected to a yearly impairment test; an excess of the net fair value of the acquired net
assets over cost is recognized in the income statement immediately at the time of initial consolidation in accordance with
IFRS 3. Consolidation according to the equity method is subject to the same principles. If the pro rata loss in an associated
company is equal to or greater than the carrying amount of the participating interest, no further losses are recognized, unless a
consolidated Group company has entered into obligations or made payments on behalf of the associated company.
Non-controlling interests are a part of earnings and net assets which is not allocable to the Group. Earnings pertaining to
these interests are therefore recognized separately from the share in earnings allocable to the shareholders of the parent
company in the income statement. In the balance sheet, these earnings are recognized in equity, separately from the equity
allocable to the shareholders of the parent company. The acquisition of non-controlling interests and changes to the shareholding of the parent company in a subsidiary which do not lead to a loss of control are reported as equity transactions in the
balance sheet.
4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
In the consolidated financial statements, assumptions and estimates must be made which influence the amounts and
recognition of assets and liabilities, income and expenses recorded, as well as contingent liabilities. Assumptions and
estimates are primarily used for determining the useful life of fixed assets, discounted cash flows during impairment tests,
and assessing the feasibility of deferred tax assets, recoverability of receivables and the recognition of provisions for legal
proceedings, pensions and other benefit commitments, taxes, warranties and guaranties. The actual values may differ from
the estimates made.
89
5. PRINCIPAL ACCOUNTING POLICIES
5.1. Changes in accounting policies
It was obligatory to apply the following standards and interpretations for the first time in the financial year:
(annual improvement process), the IASB published another amendment. This affects the following standards:
• IFRS 1 – First-time Adoption of International Financial Reporting Standards
• IFRS 3 – Business Combinations
• IFRS 13 – Fair Value Measurement
• IAS 40 – Investment Property
Details of the amendments:
• IFRS 1 – First-time Adoption of International Financial Reporting Standards
The amendment to the “Basis for Conclusions” clarifies the meaning of “effective date” in connection with IFRS 1.
If there are two published versions of a standard at the time of transition to IFRS, one current version and one version only
compulsory in the future but subject to voluntary early application, first-time users of IFRS should be able to choose which
version to apply. However, the selected version of the standard then must be applied to all periods reported on in the
annual financial statements, subject to different provisions in IFRS 1.
The amendment re-words the existing exception of joint ventures from the applicability of IFRS 3. This clarifies that the
exception applies to all joint ventures within the meaning of IFRS 11. It also clarifies that the exception only relates to the
annual financial statements of the joint venture or the joint operation itself and not the accounting policies of the parties
involved in the joint venture. The amendment has to be applied prospectively.
IFRS 13.48 permits companies which control a group of financial assets and liabilitieson the basis of their net market or
default risk to determine the fair value of this group in the same manner as market participants would value the net risk
position on the balance sheet date (so-called portfolio exception). The proposed amendment clarifies that this exception
for the determination of fair values relates to all contracts within the area of applicability of IAS 39 – Financial Instruments:
Recognition and Measurement and IFRS 9 – Financial Instruments, even if they do not fulfill the definition of a financial asset
or liability according to IAS 32 – Financial Instruments: Presentation (such as certain contracts for the acquisition and sale
of non-financial items, which can be fulfilled through cash compensation or other financial instruments). The amendment is
implemented prospectively as from the beginning of the financial year in which IFRS 13 was applied for the first time.
• IAS 40 – Investment Property
The amendment clarifies that the areas of applicability of IAS 40 – Investment property and IFRS 3 – Business Combinations
do not depend on one another, i.e. do not cancel each other out at any time. The amendment is always implemented
prospectively for all acquisitions of investment property carried out as from the beginning of the period in which the amendment is applied for the first time, meaning that the previous year's figures do not have to be adjusted. The amendment may
be applied voluntarily to individual previous acquisitions if the information required for these transactions is available.
2015
Within the scope of its process for implementing minor improvements in standards and interpretations
• Annual improvements of IFRS, cycle 2011 - 2013
90
The effects of the annual improvements to IFRS, cycle 2011 to 2013, do not have any material impact on the consolidated
financial statements of BAUER AG.
• Amendments to IAS 19 – Employee benefits – Employee Contributions
In November 2013, the IASB published an amendment to IAS 19R (2011) – Employee Contributions. The amendment
adds an option with regard to the accounting of defined benefit obligations in which employees (or third parties) participate by
way of obligatory contributions to the standard.
The effects of the amendment to IAS 19 have no significant influence on the consolidated financial statements of BAUER AG.
• Annual improvements of IFRS, cycle 2010 - 2012
Within the scope of its process for implementing minor improvements in standards and interpretations
(annual improvement process), the IASB published another amendment. This affects the following standards:
• IFRS 2 – Share-based Payment
• IFRS 8 – Operating Segments
• IAS 16 – Property, Plant and Equipment
• IAS 38 – Intangible Assets
• IAS 24 – Related Party Disclosures
Details of the amendments:
• IFRS 2 – Share-based Payment
The amendment contains a clarification of the definition of “vesting conditions” by including separate definitions for
“performance conditions” and “service conditions” in Appendix A of the standard. The amendment applies prospectively
for share-based payments granted on or after July 1, 2014.
IFRS 3.40 stipulates that a “purchaser... has an obligation to pay conditional consideration in the form of a liability or equity
based on the definitions of an equity instrument and financial liability in paragraph 11 of IAS 32... or other applicable IFRS”.
As the question of classing conditional considerations as equity or financial liabilities arises only for conditional consideration
which fulfills the definition of afinancial instrument and the question of which “other applicable IFRS” should actually be
consulted for such classification, the wording of IFRS 3.40 was amended so that it only contains a reference to conditional
consideration incurred during business combinations that fulfills the definition of a financial instrumentand the reference to
“other applicable IFRS” will be deleted. The provision of IFRS 3.58 regarding the subsequent measurement of conditional
consideration was also ambiguous as conditional consideration not classed as equity must be recognized at fair value,
but reference is made at the same time to IFRS 9 (and IAS 39), IAS 37, and IFRS, which may not require any recognition
at fair value. The amendment must be applied prospectively to all business combinations acquired on or after July 1, 2014.
91
• IFRS 8 – Operating Segments
The following clarifications are added to IFRS 8:
– When combining business segments into reportable segments, the deliberations made by management with regard
the identification of the reportable segments (short description of the combined business segments, economic factors,
– Segment assets only have to be offset and reconciled with the respective balance sheet figures if information on the
segment assets also forms part of the financial information which is reported regularly to theresponsible instance in the
company (chief operating decision maker).
The amendment of “Basis for Conclusion” of IFRS 13 clarifies that the IASB did not aim to remove the option to not apply a
discount to current receivables and liabilities if the effect achieved from this measure is immaterial through the amendment
to IFRS 9 and IAS 39 resulting from IFRS 13.
• IAS 16 – Property, Plant and Equipment / IAS 38 – Intangible Assets
The amendment clarifies how to determine cumulative depreciation and amortization at the time of measurement when
applying the revaluation model in accordance with IAS 16.35 and IAS 38.80 respectively. The transitional provisions
stipulate that the amendment only has to be applied to new measurements performed for the first time in financial years
starting on or after the time of initial application as well as financial years starting in the immediately preceding period.
• IAS 24 – Related Party Disclosures
The amendment expands the definition of “related parties” by companies which provide management services in key
positions for the reporting entity themselves or through one of their group companies without there being any other relation
within the meaning of IAS 24 between both companies (so-called “management entities”).
The effects of the annual improvements to IFRS, cycle 2010 to 2012, do not have any material impact on the consolidated
financial statements of BAUER AG.
Moreover, the IASB and the IFRIC have adopted further standards, interpretations and amendments, as listed below,
some of which were not yet bindingly applicable, or had not yet been recognized by the EU, in financial year 2015.
The BAUER Group had not implemented early application of these standards by December 31, 2015.
2015
must be stated, and
which were used as a basis for determining the “comparable economic characteristics” within the meaning of IFRS 8.12)
92
Initial application of the standards is planned as from the point they are recognized and adopted by the EU.
Standard/Interpretation/Amendment
Amendment to IFRS 11; Acquisitions of Interests in Joint Operations
Applicable
as from the
financial year
Adopted
by the EU
2016
Yes
Amendment to IAS 16 and IAS 38; Clarification of acceptable methods of depreciation and amortization
2016
Yes
Amendment to IAS 16 and IAS 41; Agriculture: Bearer Plants
2016
Yes
IFRS 15; Revenue from Contracts with Customers
2018
No
Amendment to IAS 27, Separate Financial Statements (Equity Method)
2016
No
Amendment to IFRS 10 and IAS 28; Sale or contribution of assets between an investor and its associate
or joint venture
2016
No
Annual improvement of IFRS (cycle 2012 - 2014)
2016
No
Amendment to IFRS 10, IFRS 12, and IAS 28; Application of the investment entities exceptions
2016
No
Amendment to IAS 1; Disclosure Initiative
2016
No
IFRS 14; Regulatory Deferral Accounts
2016
No
IFRS 9; Financial Instruments
2018
No
IFRS 16; Leasing relationships
2019
No
Potential effects of the initial application of IFRS – 15 Revenue from Contracts with Customers, IFRS 16 – Leasing Relationships
and IFRS 9 – Financial Instruments are currently being analyzed IFRS 15 will replace the contents of the IAS 18 “Sales Revenues”
and of the IAS 11 “Construction Contracts”. The new standard does not differentiate between different order and service types,
but instead puts in place uniform criteria of when sales revenues are to be realized in terms of time and period for a service
provision. This is the case when the client attains the power of disposition over the agreed goods and services and can capitalize
on this.
IFRS 16 will replace IAS 17 “Leasing relationships”, IFRIC 4 “Establishing if an agreement contains a leasing relationship”, SIC 15
“Operating leasing relationships – Incentives” as well as SIC 27 “Assessment of the profitability of transactions in the legal form of
leasing relationships”. The new standard does not undertake any classification in finance and operating leasing relationships
for lessees, instead basically all leasing relationships are included in the balance sheet in the form of usage rights and leasing
liabilities. There will be no major changes to lessor accounting compared to IAS 17. In contrast to IAS 17, IFRS 16 stipulates
more extensive details on the appendices.
IFRS 9 (2014) replaces the previous regulations of the IAS 39 on financial instruments. It includes changed regulations on
evaluation categories for financial assets and smaller changes in respect to the evaluation of financial liabilities. A fair value
evaluation which does not affect profit or loss is planned for certain borrowing instruments on the assets side. Additionally, it
includes regulations for impairments of assets and on hedge accounting. The regulations for impairment are initially tailored
to expected defaults. The new regulations on hedge accounting should also make it easier to illustrate risk management
activities in the consolidated financial statements. In this respect, IFRS 9 (2014), among others, expands the underlying
transactions which qualify for hedge accounting and simplifies the efficiency tests. BAUER AG does not expect any of the
other standards to have any material impact on the consolidated financial statements.
5.2. Significant accounting policies
Foreign currency translation
Foreign currency transactions are translated in the financial statements of BAUER AG and the consolidated subsidiaries
at the rates applying on the dates of the transactions. The financial statements of the foreign companies belonging to the
BAUER Group are translated into euros according to the functional currency concept. Accordingly, assets and liabilities are
translated at the rate applying on the balance sheet date and the income statement items at the average rate. The resulting
differences from currency translation are recognized in the provision for currency translation losses stated under equity without
having any effect on profit or loss.
93
The following table shows the exchange rates applied for the currency translation:
2015
2014
2015
EGP
9.3713
8.5293
8.6984
8.4192
Argentina
ARS
10.8648
10.4092
10.4039
14.1386
Australia
AUD
1.4708
1.4787
1.4841
1.4894
Bulgaria
BGL
1.9559
1.9558
1.9559
1.9558
Chile
CLP
757.8911
727.6212
736.1344
772.0222
China
CNY
8.1575
7.0724
7.5550
6.9434
Georgia
GEL
2.3352
2.5284
2.2604
2.6140
Ghana
GHS
4.0594
4.2281
3.9112
4.1725
Great Britain
GBP
0.8028
0.7236
0.7818
0.7350
Hong Kong
HKD
10.2525
8.5570
9.4373
8.4422
India
INR
80.7777
70.9623
77.4729
72.3087
Indonesia
IDR
15,669.6389
14,862.6723
15,139.9647
15,046.6072
Japan
JPY
140.5059
133.5525
145.2439
131.1173
Jordan
JOD
0.9357
0.7822
0.8611
0.7724
Canada
CAD
1.4634
1.4239
1.4117
1.5125
Qatar
QAR
1.3219
4.0194
4.4307
3.9659
Lebanon
LBP
1,995.3273
1,665.1715
4.5653
1,642.5471
Malaysia
MYR
4.3329
4.3409
4.2622
4.6730
Morocco
MAD
11.1575
10.8081
10.9957
10.7831
Mexico
MXP
17.6560
17.6440
17.9234
18.9240
New Zealand
NZD
1.6001
1.5914
1.5506
1.5914
Oman
OMR
0.5090
0.4250
0.4684
0.4193
Panama
PAB
1.3219
1.1039
1.2166
1.0892
Peru
PEN
3.7598
3.5349
3.6351
3.7081
Philippines
PHP
58.7377
50.3376
54.4041
51.2554
Poland
PLN
4.1955
4.1810
4.2902
4.2636
Romania
RON
4.4386
4.4403
4.4845
4.5229
Russia
RUB
51.5000
68.6566
67.5895
80.4168
Saudi Arabia
SAR
4.9585
4.1416
4.5653
4.0886
Sweden
SEK
9.1184
9.3339
9.4275
9.1831
Switzerland
CHF
1.2124
1.0631
1.2024
1.0822
Singapore
SGD
1.6778
1.5198
1.6074
1.5397
South Africa
ZAR
14.3577
14.2607
14.0575
16.9831
Taiwan
TWD
40.1344
35.0744
38.5999
35.8330
Thailand
THB
42.9860
37.9774
40.0245
39.2530
Turkey
TRY
2.8937
3.0361
2.8327
3.1815
Hungary
HUF
309.9893
309.4268
314.9587
315.2762
United Arab Emirates
AED
4.8553
4.0545
4.4685
4.0004
United States of America
USD
1.3219
1.1039
1.2166
1.0892
Vietnam
VND
28,039.4804
24,240.1659
26,031.7369
24,498.2509
2014
Egypt
Balance sheet date value
2015
Yearly average value
1 EUR corresponds to
94
Intangible assets
Intangible assets are capitalized at cost and amortized according to the straight-line method over the projected useful life
of 3 to 10 years.
Assets which have an indefinite useful life, such as goodwill, are not subjected to scheduled amortization but are impairmenttested each year, or when relevant indications arise. The goodwill is the amount by which the acquisition cost of the acquisition
exceeds the fair value of the Group's shares in the net assets of the acquired entity at the date of acquisition. Goodwill created
by acquisition is recognized under “Intangible assets”. Goodwill resulting from the acquisition of an associated company is
included in the carrying amount of investments in associated companies and consequently is not impairment-tested separately,
but within the overall carrying amount. The recognized goodwill undergoes an annual impairment test is recognized at cost less
accumulated write-downs. Write-ups are impermissible. Gains and losses from the sale of a company comprise the carrying
amount of goodwill allocated to the company to be disposed of.
Assets subject to scheduled depreciation or amortization are tested for impairment if any events or changes of circumstances
indicate that the carrying amount may no longer be achievable.
Impairment in the amount of the carrying amount exceeding the attainable amount is recognized. The attainable amount is the
higher amount of the applicable fair value of the asset less selling costs and the value in use. For the impairment test, assets
are grouped at the lowest level for which cash flows can be separately identified (cash-generating units). With the exception of
goodwill, a test is performed on each balance sheet date in respect of non-cash assets for which in the past an impairment was
recognized as to whether a value recovery adjustment is required.
Research and development costs are generally charged as expenditure in the financial year in which they occurred, in accordance
with IAS 38. Exceptions to this are certain development costs which are capitalized where it is probable that a future economic
benefit will be drawn from the development project and the costs incurred can be measured reliably. In addition, the following
criteria in accordance with IAS 38.57 must be met:
• Technical feasibility of completion of the intangible asset so that it will be available for use or sale
• Intention to complete the intangible asset and to use or sell it
• Ability to use or sell the intangible asset
• Evidence of how the intangible asset will generate probable future economic benefits
• The availability of adequate technical, financial and other resources to complete the development and to use or sell
the intangible asset
• The ability to measure reliably the expenditure attributable to the intangible asset during its development
The cost of manufacture includes all costs directly attributable to the development process as well as appropriate portions
of development-related overheads. The assets in development are subjected to an annual impairment test and valued at their
original cost less cumulative depreciation. Amortization is undertaken according to the straight-line method as from start of
production over the intended term of the developed models. The projected useful life is between 3 and 6 years. Impairment
losses on intangible assets are recognized to the higher of the value in use or net realizable value. If the preconditions for an
impairment no longer exist, reversals of impairment – except for goodwill – are undertaken.
95
According to IAS 16, property, plant and equipment is valued at cost, less scheduled straight-line depreciation based on the
pro rata temporis method, unless in exceptional cases some other method of depreciation more effectively reflects the usage.
Buildings and other structures
Economic life
3 to 60 years
Technical equipment and machinery
3 to 21 years
Other equipment, factory and office equipment
2 to 21 years
Impairment losses on property, plant and equipment are recognized in accordance with IAS 36 where the value in use or
fair value less cost to sell of the asset concerned has fallen below the carrying amount. If the reasons for an impairment
recognized in previous years no longer exist, a corresponding reversal of impairment is applied.
Both impairment losses and scheduled depreciation are recognized under the “Depreciation of fixed assets” item.
The level of impairment losses is explained in accordance with IAS 36 under “Non-current assets”.
Leasing
The BAUER Group acts as both a lessee and a lessor. Leasing relationships are classified according to IAS 17 based on
the distribution of opportunity and risk between the lessor and lessee.
Leasing relationships in which most of the opportunity and risk linked to ownership of the leased item remains with the
lessor are classified as operating leases. Where the lessee has most of the opportunity and risk, the agreement is classified
as a finance lease.
a) Accounting for lessee transactions
Payments made in connection with an operating lease (net after taking into account incentive payments by the lessor) are
recognized in the income statement by straight-line depreciation over the term of the lease.
Assets from finance leases are capitalized at the start of the lease term at the lower of the fair value of the leased item and
the present value of the minimum lease payments. A leasing liability is recognized under “Current and non-current liabilities”.
Each lease installment is split into an interest and a repayment portion, so that the leasing liability is subject to a consistent
interest rate. The interest portion of the lease installment is recognized as affecting expenditure in the income statement.
The property, plant and equipment asset held under a finance lease is written down over the shorter of the economic life
of the asset or the lease term.
b) Accounting for lessor transactions
A lease is an agreement whereby the lessor assigns to the lessee the right to use an asset for a specific period of time against
a payment or series of payments.
Assets leased by the customer in the form of operating leases are assigned on the balance sheet according to their nature.
Income from leases is recognized by the straight-line method over the term of the agreement.
In the BAUER Group, mainly operating leases are entered into as the lessor.
2015
Asset
The following table provides an overview of the useful lives:
96
Government grants
Government grants for assets including non-monetary benefits at fair value are recognized on the balance sheet as accruals
on the Equity and Liabilities side (Investment allowance) or, on determining the carrying amount of the asset, are deducted
from the Assets side (Invest subsidy).
Business combinations
Acquisitions of subsidiaries are accounted for in accordance with IFRS 3 based on the acquisition method. The cost of the acquisition corresponds to the fair value of the assets contributed, the equity instruments issued and the liabilities created and/or
transferred at the transaction date. Assets, liabilities and contingent liabilities identifiable in the course of a business combination
are measured on initial consolidation at their fair values at the acquisition date. The amount by which the acquisition cost
exceeds the Group's share of the net assets measured at their fair value is stated as goodwill. The non-controlling interests
are valued either at cost (Partial Goodwill method) or at fair value (Full Goodwill method). The available option can be
exercised on a case-by-case basis. BAUER Group policy is to apply the Partial Goodwill method. If the acquisition cost is
less than the net assets of the acquired subsidiary measured at their fair value, the difference is recognized directly in the
income statement. Transaction costs directly linked to a business combination are recognized in the income statement. In the
event of successive acquisitions, the differences between the carrying amount and the applicable fair value of the shares
previously held are recognized as affecting net income at the time of acquisition. Existing contracts with the acquired entity at
the time of acquisition, except those under the terms of IAS 17 and IFRIC 4, are analyzed and reclassified where appropriate.
Borrowing costs
Borrowing costs linked directly to the acquisition, construction or production of qualifying assets in accordance with IAS 23 are
included in the cost of the asset in question for the period until start of use of the asset. No borrowing costs were capitalized
in the financial and previous year. Testing as to whether an asset is a qualifying asset is carried out according to internally
stipulated materiality limits for projects and installations. If the said materiality limits are exceeded, borrowing costs for qualified
assets are capitalized. Other financing costs are recognized as ongoing expenditure under “Financial expenses”.
Land and buildings maintained in order to generate rental income are accounted for at amortized cost in accordance with
IAS 40, with the useful lives applied for depreciation (straight-line according to the pro rata temporis method) corresponding
to those of the property, plant and equipment used by the company itself. The measurement is derived from current market
prices for similar property. This method is part of level 2 of the fair value hierarchy stated in IFRS 13.
Associated companies
According to IAS 28, an associated company is any entity over which the investor has significant influence, though not
control. This routinely means voting shares of between 20 and 50 percent.
Shares in associated companies are valued at-equity and recognized initially at cost. The Group's shares in associated
companies include the goodwill created by the acquisition (less cumulative impairment).
97
The Group's share in the profits and losses of associated companies is reported in the income statement as from the time of
acquisition. The share in changes in reserves is recorded in the Group reserves. Cumulative changes after acquisition are set
off against the carrying amount of the investment. If the Group's share in the losses of an associated company is equal to
or more than the Group's shareholding in the said associate, including other unsecured claims, the Group recognizes no
the Group's share in the associated company. Non-realized losses are likewise eliminated, unless the transaction implies an
impairment of the transferred asset.
Joint ventures
Joint ventures are joint arrangements in which the parties exercise joint control and have claims to the net assets of the
arrangement. The contractually agreed joint management of the arrangement jointly manages the venture. This is only
the case if decisions regarding the material activities require the unanimous approval of the parties involved in the joint
management.
Joint arrangements recognized at equity include joint ventures as well as the Arbeitsgemeinschaften (“ARGE”) consortia specific
to Germany, with there being a difference between ARGE consortia and umbrella ARGE consortia. Both consortia are subject to
the regulations of IFRS 11.
Assets are provided for and invoiced to ARGE provision consortia in the form of employees, material or equipment. The results
generated by the provision consortia are recognized in the balance sheet using the equity method, in accordance with IAS 28.
They are recognized in the balance sheet as investments accounted for using the equity method and as income from investments
accounted for using the equity method in the income statement.
An umbrella consortium, on the other hand, is always recognized without any effect on profit and loss. The compensation claims
between umbrella consortium and customer are identical to the compensation claims between the individual consortia and the
umbrella consortium. The umbrella consortium transfers all payments received from the customer in full to the individual consortia.
BAUER as a partner in an umbrella consortium accounts for the assets at its disposal and the liabilities it itself incurs, as well as
its own expenditures, and recognizes the income from such activities on a pro rata basis in its sales revenues.
Ongoing settlements from and to consortia are recognized in receivables or liabilities to joint ventures.
Joint operations
Joint operations are joint arrangements in which the parties assume joint control and hold rights in the assets as well as
obligations with regard to the liabilities of the arrangement. The contractually agreed joint control of the arrangement jointly
controls the arrangement. This is only the case if decisions regarding the material operations require the unanimous approval
of the parties involved in the joint control.
2015
Non-realized gains from transactions between Group companies and associated companies are eliminated according to
additional losses, unless it has entered into obligations or made payments on behalf of the associated company.
98
Any operations performed by the BAUER Group as part of a joint operation relating to its share in the joint operation are
recognized in the following items:
- Its assets, including its share in jointly held assets
- Its liabilities, including its share in jointly incurred liabilities
- Its income from the sale of its share in the products of the joint operation
- Its share in income from the sale of products or services by the joint operation, and
- Its expenses, including its share in any jointly incurred expenses
For transactions such as the acquisition of assets by a Group company, gains and losses are recognized in the amount
of the Group share of other joint operations only once the assets are sold to third parties.
Financial instruments
a) Primary financial instruments
In the BAUER Group, primary financial instruments are assigned as financial assets to the following categories:
• Loans and Receivables (LaR)
• Available-for-Sale (AfS)
The “Loans and Receivables” category includes current and non-current financial assets.
The “Available-for-Sale” category includes marketable securities as well as equity portions which are not consolidated or
not recognized by the equity method. For those equity portions there is no active market, and no fair value can be reliably
determined for them, so the shares are valued at cost. We have no intention of selling them.
Financial assets held for sale are non-derivative financial assets classified as available for sale and those not classified as one
of the other categories of financial assetsstated. They are recognized at fair value both when initially entered and in the
subsequent periods.
Assets classified as held for sale are impairment-tested at each balance sheet date in relation to objective criteria
(such as significant financial difficulties of the debtor, high probability of insolvency proceedings being initiated against the
debtor, loss of an active market in the financial assets). Any impairment expenditure incurred because a fair value is less
than the carrying amount is recognized affecting net income. Where impairment of the fair values of assets held for sale was
previously stated not affecting net profit in the shareholders' equity, it must be eliminated from the shareholders' equity up to
the amount of the measured impairment and recognized in the income statement. If subsequent valuation reveals that the fair
value has objectively increased due to events occurring after entry, the impairment is reversed in the corresponding amount.
Recovery in the value of debt instruments is recognized in the income statement. Impairment affecting equity instruments held
for sale and recognized at cost must not be reversed.
Primary financial instruments as financial liabilities are assigned to the following category:
• Financial Liabilities Measured at Amortized Cost (FLAC) or Other Financial Liabilities
The “Financial Liabilities Measured at Amortized Cost” category includes liabilities to banks, trade payables as well as other
current and non-current liabilities and current and non-current financial liabilities.
99
Receivables and liabilities in the “Financial Liabilities Measured at Amortized Cost” and “Loans and Receivables” categories
are initially recognized at the applicable fair value, including transaction costs directly attributable to acquisition of the financial
asset or incurring of the financial liability, and subsequently measured at amortized cost, applying the effective interest rate
method. The amortized cost of a financial asset or liability is calculated, applying the effective interest rate method, from the
value recovery adjustment.
In the case of current receivables and liabilities, the amortized cost always corresponds to the nominal amount, or the
amount repayable. Cash and cash equivalents comprise credit balances with banks as well as petty cash stocks, and
are valued at amortized cost.
In the case of financial assets or liabilities recognized in the income statement at fair value, the initial fair-value valuation excludes
the transaction costs. Financial liabilities are derecognized when they have been paid or the obligation has been extinguished.
Items are initially recorded on the performance date. In the case of financial assets, derecognition of potential default risks
is effected by value adjustments in separate value adjustment accounts. Financial assets are derecognized if the rights to
payments from the financial assets have expired or been transferred, and the Group has essentially transferred all risks and
opportunities associated with ownership, or the essential opportunities and risks have neither been transferred nor retained,
but right of disposal has been transferred. If there are doubts as to the collectability of receivables, they are valued at amortized
cost less appropriate single valuation allowances or a flat-rate allowance. Impairment of trade receivables is recognized when there
are objective signs (such as disputed contract variations, missed payments or insolvencies) indicating that the amounts due will
not be collectable in full. The impairment is recognized in the income statement by way of a value adjustment account. All other
impairments are written off directly and likewise recognized in the income statement. Group directives stipulate that impairment
of receivables must always be recorded in separate value adjustment accounts. They are derecognized at the same time as the
corresponding impaired receivable. The fair value option provided by IAS 39 was not exercised.
b) Derivative financial instruments
A derivative is a financial instrument or contract within the area of applicability of IAS 39, which cumulatively meets
the following criteria:
• which varies in value based on changes in a specific interest rate, price of a financial instrument, commodity price, exchange
rate, price or interest rate index, credit rating or credit index, or some similar variable, provided in the case of a non-financial
variable the variable is not specific to one party to the contract;
• which requires no payment in return for acquisition, or one which, compared to other forms of contract expected to react
similarly to changes in market conditions, is lower;
• which is settled at a later date.
In the BAUER Group, free-standing derivative financial instruments are assigned as financial assets to the following category:
• Financial Assets Held for Trading or “FAHfT”
Free-standing derivative financial instruments as financial liabilities are assigned to the following category:
• Financial Liabilities Held for Trading or “FLHfT”
2015
amount and the amount repayable at the final due date, and also less depreciation and impairment or plus appreciation and
historical cost less the repayments made, plus or less the cumulative amortization of any difference between the original
100
Changes in value of derivatives not forming part of a cash flow hedge are stated under other operating income or expenses in
the case of foreign exchange forward contracts or options or, in the case of interest-rate swaps, are recognized in the income
statement under financial expenses or income. The applicable fair values of the level 2 financial instruments are calculated on
the basis of the conditions prevailing at the balance sheet date, such as interest or exchange rates, and applying recognized
models, such as discount cash flow or option price models.
The free-standing derivative financial instruments of the “Financial Assets Held for Trading” and “Financial Liabilities Held for
Trading” categories include fair values of interest rate swaps, foreign exchange options, cross-currency swaps and foreign
exchange forward contracts not included in hedge accounting or not meeting the hedge accounting conditions.
In the BAUER Group, derivative financial instruments (interest rate swaps, foreign exchange options, cross-currency swaps
and foreign exchange forward contracts) are entered into solely to hedge against interest rate and currency risks. No deals
are made without an underlying transaction.
In the case of derivatives included in hedge accounting, when hedging expected future transactions (cash flow hedges) the
effective portion of the gain or loss from a hedging instrument is initially recognized in the shareholders' equity, taking into
account deferred taxes, and is only recognized in the income statement when the underlying hedged transaction is realized.
The ineffective portion of the hedge transaction is recognized in the income statement immediately. The derivative financial
instruments are stated at their fair values as assets or liabilities. The fair values of the foreign exchange forward contracts
are defined on the basis of current reference prices, taking into account forward premiums and discounts. The fair values
of the interest rate swaps are determined on the basis of discounted future payment flows, applying the market interest rates
applicable to the respective residual terms of the derivatives. Items are initially recorded on the trading date. Hedge accounting
was applied in financial 2015.
Inventories
Inventories of finished goods and work in progress and stock for trade as well as raw materials and supplies are valued
at manufacturing cost or at the lower net realizable value on the balance sheet date in accordance with IAS 2.
The net realizable value is the estimated achievable selling price in the ordinary course of business less the estimated costs
through to completion and the estimated necessary selling costs.
Raw materials and supplies are valued mainly at floating average cost.
Where the machinery and accessories classified as finished goods and stock for trade and primarily held for sale, are hired
out for a short period as a secondary sales promotion measure, the following factors are considered in determining their net
realizable values:
• Hire period
• Useful life of the machines
• Damage and inoperability
Where the net realizable value of previously written-down inventories has increased, corresponding value recovery adjustments are made. The cost of manufacture includes all direct costs of the manufacturing process. The level of impairment
losses on inventories is explained in accordance with IAS 2 under “Inventories”.
101
Construction contracts
Construction contracts are accounted for by the percentage of completion method in accordance with IAS 11.
The sales are recognized according to the progress of work based on the percentage of completion method. The applicable
percentage of completion is determined according to the costs incurred (cost-to-cost method). Where the cumulative return
of the payments on account, it is recognized as a liability under “Liabilities from construction contracts (PoC)”. Expected
losses on a contract are accounted for in full at the time they are identified, by adjustments to the valuation of any existing
receivables or by the creation of a provision. Construction contracts undertaken in joint ventures are valued according to the
percentage of completion method. Receivables from joint ventures also include the pro rata result from the contract.
Expected losses are covered by write-downs or liabilities as appropriate, and are taken into account in the contract result.
Service concession arrangements
Service concession arrangements entailing an unconditional contractual right to receive a payment in accordance with
IFRIC 12 are recognized separately under “Receivables from concession arrangements”. The short-term portions of the
receivables from concession arrangements are stated under “Other current financial assets”. The receivables are allocated
to the “Loans and Receivables” category and recognized at the present value of the remuneration payable. The annual
interest due according to the effective interest rate method is recorded in the financial income.
Cash and cash equivalents comprise cash and sight deposits with an original term of no more than three months.
Deferred taxes
In accordance with IAS 12, deferred taxes are taken into account in respect of variations between the valuations of assets
and liabilities according to IFRS and their corresponding tax bases in the amount of the projected future tax charge or refund.
In addition, deferred tax assets are recognized for future advantages arising from tax losses carried forward, provided it is
probable that they will be realized.
Deferred taxes arising from temporary differences in connection with investments in subsidiaries and associated companies
are recognized, unless the date of reversal of the temporary differences can be determined by the Group and it is likely that the
temporary differences will not be reversed again in the foreseeable future because of this effect.
According to IAS 12.74, deferred tax assets and liabilities are to be offset if a legally enforceable right to set off current tax
assets against current tax liabilities exists. Offsetting should also be carried out if the deferred tax assets and liabilities relate
to income taxes levied by the same tax authority in respect of:
• either the same taxable entity or
• different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realize the assets
and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are
expected to be settled or recovered.
The tax expenditure for the period comprises current and deferred taxes. Taxes are reported in the income statement,
unless they relate to items recognized directly in the shareholders' equity or in the other result. In this case; the taxes are
likewise recognized in the shareholders' equity or in the other result.
2015
recognized as assets under “Receivables from construction contracts (PoC)”. If a negative balance remains after deduction
(contract costs and pro rata result) exceeds the payments on account in individual cases, the construction contracts are
102
In Germany, deferred taxes are stated on the basis of corporation tax, the “solidarity surcharge” and trade tax, in a range of
26.90 to 31.69 percent (previous year: 27.82 percent and 30.92 percent). Outside Germany, tax rates of between 0.00 percent
and 38.15 percent are applied (previous year: 0.00 and 38.15 percent).
Provisions
a) Provisions for pensions
The BAUER Group operates a number of defined benefit plans in Germany and internationally.
Typically, such plans define an amount of pension benefit which employees will receive on retirement and which is normally
dependent on one or more factors (such as age, years of service and salary).
The provision for defined benefit plans on the balance sheet corresponds to the cash value of the defined benefit obligation
(DBO) at the balance sheet date, less the fair value of the plan assets. The DBO is calculated annually by an independent actuary
applying the projected unit credit method. The cash value of the DBO is calculated by discounting the expected future inflow of
funds at the interest rate of industrial bonds of the highest credit rating. The industrial bonds are denominated in the currency
of the disbursements, and have terms corresponding to the pension commitments. In countries where the market in such bonds
is insufficiently developed, government bonds are applied.
Actuarial gains and losses based on experience-related adjustments to actuarial assumptions are recognized in the “Other
comprehensive income” in the shareholders' equity in the period in which they occur. Post-employment expenditure is recognized
in staff cost and the interest portion of the addition to provisions in financial expenses.
Under the contribution-based defined benefit plans, the entity concerned makes payments to pension institutions which
are stated in the personel expenses.
b) Provisions for tax purposes
Tax provisions include liabilities from current income taxes. Income tax provisions are balanced against corresponding
tax refund claims, provided they arise in the same tax territory and are identical in nature and in terms of due date.
c) Other provisions
The other provisions are created in accordance with IAS 37 where a present obligation arises from a past event, a relevant
claim is more likely than unlikely, and the amount of the claim can be reliably estimated. The provisions are stated at their
performance amount, and are not netted against profit contributions. Long-term provisions are recognized at present value.
Provisions are created only for legal or constructive obligations to third parties.
Income and expenses
Sales revenues and other incomes are realized in accordance with IAS 18 on performance of the supply or service or
on transfer of risk to the customer, as appropriate.
Dividend income is recognized at the date on which the right to receipt of payment is created. Dividends received are recognized
as income from operating investments under “Financial income”. Operating expenses are recognized as affecting net income
when the supply or service is claimed or at the time they are caused, as appropriate. Financial income and expenses are
recognized when incurred.
Income from service contracts is recognized according to the degree of completion.
103
6. SEGMENT REPORTING
Reporting on the segments of the BAUER Group was implemented in accordance with IFRS 8, as in the previous year.
The internal organizational and management structure and the internal system of reporting to the Management Board and
conducted at market prices.
SCHACHTBAU NORDHAUSEN GmbH is the only Group company to operate in all three segments. The assets and liabilities
and income statement items of SCHACHTBAU NORDHAUSEN GmbH are assigned to the relevant segments.
Construction
The core business of the Construction segment is specialist foundation engineering. Complete excavation pits and
foundation works, often in difficult subgrade conditions, are carried out for major infrastructure projects and buildings.
In order to offer customers a full range of services, the companies of the BAUER Group additionally offer other construction
services, often involving a major specialist foundation engineering element. Examples of this include bridges, environmental
engineering, remediation and building renovation projects. The Construction segment is founded on the close interlinking of
all construction activities.
Equipment
In the Equipment segment, machinery for all specialist foundation engineering processes and for deep drilling is developed
and manufactured for worldwide distribution. The specialist foundation engineering equipment can be employed to produce
large-diameter and small-diameter bores for piles, diaphragm walls, anchors, injections and wells. The deep drilling equipment
can be employed to drill for geothermal energy, oil and gas. Equipment for ramming and ground improvement is also manufactured. The range is supplemented by a wide selection of add-on units and ancillary equipment, covering all the processes
involved in specialist foundation engineering.
Resources
The Resources segment brings together all the Group companies providing products and services relating to the remediation and extraction of natural resources essential to human life. They include environmental technology companies involved in
the treatment of ground and groundwater as well as companies involved in exploration drilling and mining of raw materials and
drilling of wells and geothermal energy sources. This segment also includes companies which manufacture and sell materials
for the engineering of bore holes, specifically for wells and geothermal energy sources.
Other
The Other segment comprises the central services (accounting, human resources, IT etc.) provided by BAUER AG to the
Group companies as well as other units not assignable to the separately listed segments, providing services such as in-house
and external education and training and centralized research and development.
2015
The BAUER Group comprises the Construction, Equipment and Resources segments. Transactions between the segments are
Supervisory Board dictate the segmentation employed by the BAUER Group.
105
Consolidation
The intersegmental consolidation effects are grouped here under Consolidation. This includes offsetting of intra-Group sales
between the segments as well as income and expenses and interim results. The intersegmental consolidation effects are
adjusted within the respective segments.
liabilities of the Group. The non-current assets stated in the segment report by region comprise intangible assets, property, plant
and equipment and investment property.
Total Group revenues, consolidated revenues and sales revenues with third parties
The consolidated revenues reflect the performance of all the companies included in the scope of consolidation. The
total Group revenues represent the revenues of all the companies forming part of our Group. The difference between the
consolidated revenues and the total Group revenues is derived from the revenues of the associated companies, from our
subcontractor shares in joint ventures, and from the revenues of non-consolidated companies.
The sales revenues with third parties are allocated to the business segments according to the customer’s location.
No one customer accounts for more than 10 percent of total sales.
No breakdown of sales revenues by product and service, or by groups of comparable products and services, was available
as per the balance sheet date.
Enlarging the access to the Port of Hamburg has extended the available tidal windows for large ships to enter and leave the port.
Our customer Demler Spezialtiefbau GmbH + Co KG secured the elevated section by a combined wall comprising supporting and
sheet piles. Two BG 39s with two BV 2000s casing oscillators were used.
2015
of shares valued at-equity and the income tax expenditure. The segments' assets and liabilities incorporate all the assets and
The segment result for the period reflects the financial income and expenses as well as the net earnings
106
Segment reporting
SEGMENT REPORT BY BUSINESS SEGMENT
Construction
2015
2014*
in EUR ’000
Total revenues (Group)
Sales revenues with third parties
Sales revenues between business segments
OPERATING RESULT
2015
725,626
742,862
639,151
753,083
650,762
532,691
548,039
16,352
18,568
42,806
52,458
-105
105
27,898
30,230
2014*
646,628
Other income
Equipment
471
585
6,170
4,979
25,088
25,680
21,497
113,164
688,434
695,700
631,062
748,870
26,033
13,916
35,952
99,441
Financial income
2,993
2,306
1,882
1,768
-16,165
-14,009
-20,863
-20,903
Share of the profit or loss of associated companies accounted for using
the equity method
-1,330
171
-57
226
Income tax expense
-9,007
-9,700
-8,067
-15,135
2,524
-7,316
8,847
65,397
-45,945
-48,420
-19,412
-18,717
0
-89
-1,768
-765
0
0
-15,789
-13,195
Impairment losses on financial assets
-631
-13
-1,710
0
Impairment losses on inventories
-282
-656
-8,052
-11,295
Allocation of valuation allowance of receivables
-10,597
-21,204
-4,611
-8,965
Reversal of valuation allowance of receivables
14,726
14,617
3,881
4,321
586,378
616,089
759,510
818,061
Financial expenses
ADDITIONAL INFORMATION ON THE INCOME STATEMENT
Depreciation and amortization
of which impairment losses on fixed assets
Major non-cash segment items
ADDITIONAL INFORMATION ON THE BALANCE SHEET
SEGMENT ASSET DEC. 31
of which shares in associated companies accounted for
using the equity method
10,687
9,430
42
90,975
of which capital investments in fixed assets
40,965
58,183
20,776
18,775
458,580
483,534
543,056
540,036
SEGMENT LIABILITIES DEC. 31
SEGMENT REPORT BY REGION
in EUR ’000
Germany
2014
440,205
Europe (other)
2015
2014
2015
Europe excluding EU
2014
473,727
151,958
161,910
124,886
2015
70,766
Sales revenues with third parties
367,779
340,407
140,534
155,438
127,782
67,199
Non-current assets Dec. 31
244,151
230,580
18,132
19,627
16,383
12,978
* Previous year figures adjusted; the Structural Steel Engineering division of SCHACHTBAU NORDHAUSEN GmbH was reclassified from the Equipment to the Construction segment
Other
2015
2014
Consolidation
2014
2015
2014
Group
2015
-96,794
2014
-102,634
2015
252,830
221,609
39,407
41,492
195,860
179,319
500
871
1,560,220
1,656,412
1,375,679
1,378,991
3,141
2,756
30,729
32,425
-93,028
-106,207
0
0
-1,171
-1,341
0
0
0
0
26,622
28,994
1,606
839
9
0
6,440
16,345
14,696
22,748
41,968
18,753
7,028
6,987
-6,559
-7,371
89,022
157,213
241,404
200,326
38,266
40,283
-93,147
-97,233
1,506,019
1,587,946
15,932
-19,807
3,326
4,566
-4,817
-7,393
76,426
90,723
2,159
1,235
13,702
10,287
-13,640
-10,624
7,096
4,972
-10,518
-11,206
-11,243
-6,488
13,640
10,624
-45,149
-41,982
815
2,275
0
0
0
0
-572
2,672
-1,895
-886
-1,537
-74
874
-22,075
-27,393
4,347
-29,398
4,899
6,828
-4,891
-6,519
15,726
28,992
-10,885
-11,601
-3,023
-3,011
484
606
-78,781
-81,143
-7
-10
0
0
0
0
-1,775
-864
0
0
0
0
0
0
-15,789
-13,195
-65
-149
0
0
0
0
-2,406
-162
-263
-198
0
0
0
0
-8,597
-12,149
-5,360
-1,899
0
0
0
0
-20,568
-32,068
950
562
0
0
0
0
19,557
19,500
264,276
269,254
338,993
362,055
-374,074
-408,551
1,575,083
1,656,908
32,177
32,249
0
0
0
-101
42,906
132,553
8,885
8,823
2,555
6,522
-485
-1,325
72,696
90,978
226,217
237,562
182,939
201,241
-254,634
-256,675
1,156,158
1,205,698
2015
-4,041
Resources
107
Middle East
and Central Asia
2014
2015
Americas
Asia-Pacific,
Far East and Australia
2014
2015
2014
Africa
2015
Group
2014
2015
2014
2015
232,037
227,679
376,645
347,788
172,288
297,392
62,201
77,150
1,560,220
1,656,412
180,313
186,019
337,587
337,701
158,411
221,809
63,273
70,418
1,375,679
1,378,991
56,025
47,825
86,106
84,121
53,259
24,217
7,293
12,463
481,349
431,811
108
EXPLANATORY NOTES TO THE INCOME STATEMENT
7. SALES REVENUES
The sales revenues generated in the amount of EUR 1,378.991 thousand (previous year: EUR 1,375,679 thousand) include
revenues arising from application of the percentage of completion method and revenues from the sale and hiring-out of
equipment and accessories.
The sales revenues from the application of the percentage of completion method amounted to EUR 697,066 thousand in the
financial year (previous year: EUR 649,625 thousand).
Sales revenues from the sale and hiring-out of equipment and accessories amounted to EUR 20,170 thousand in the financial
year (previous year: EUR 29,428 thousand).
With regard to the presentation and breakdown of sales revenues by operating segment and region, please refer to the notes
on segment reporting (see item 6).
Sales revenues provide only an incomplete picture of the performance in the financial year. Figures are therefore transferred to
total Group revenues in the following sections:
in EUR ’000
Sales revenues
2014
2015
1,375,679
1,378,991
26,622
28,994
14,696
22,748
Other income
89,022
157,213
Consolidated revenues
1,506,019
1,587,946
Subcontractor share ARGEN
13,370
10,158
Revenues of associates and joint ventures
22,188
45,322
Revenues of non-consolidated companies
Intra-Group revenues
34,700
34,742
-16,057
-21,756
1,560,220
1,656,412
The sales revenues include a net valuation allowance of EUR -3,107 thousand (previous year: EUR 5,381 thousand). The net
impairment result is attributable to the Construction segment, where final invoices, for example, may include supplementary
items which have not yet been finally negotiated with the customer and ordered. These may prove uncertain. Valuation allowances
(reductions for impairment) are made in respect of uncertain receivables and recorded under “Sales revenues”. If the uncertain
receivable is realized, the reduction for impairment is reversed. The reversal is likewise recorded under “Sales revenues”. The
net balance of the application and reversal of reductions for impairment in respect of uncertain receivables produces the
aforementioned net value adjustment.
The application and reversal of reductions for impairment by the other segments is stated under “Other operating expenses”.
8. OTHER CAPITALIZED GOODS AND SERVICES FOR OWN ACCOUNT
in EUR ’000
Income from other capitalized goods and services for own account
2014
14,696
2015
22,748
109
9. OTHER INCOME
Realized and unrealized foreign currency gains
Income from insurance refunds
Other income from rentals
Income from changes in fair values of foreign exchange forward contracts
2015
5,447
16,411
32,097
45,611
1,849
1,434
272
263
2,548
5,216
Effects from final and transitional consolidations
36,531
77,896
Other operating income
10,278
10,382
Total
89,022
157,213
The realized and unrealized foreign currency gains as well as gains from foreign exchange forward contracts stated under
“Other income” totaling EUR 50,827 thousand (previous year: EUR 34,645 thousand) arose in connection with the global
currency hedging strategy and the underlying currency postings. In this context, the income is countered by realized and
unrealized foreign currency losses as well as losses from foreign exchange forward contracts totaling EUR 58,501 thousand
(previous year: EUR 29,767 thousand), stated under “Other operating expenses”.
Additionally, the other operating income mainly comprises income from benefits in money's worth, other reimbursements of
expenditure as well as other income spread across the consolidated companies which is of minor importance in the individual
instances.
10. COST OF MATERIALS
in EUR ’000
2014
2015
Expenses for raw materials and supplies and purchased goods
504,877
511,539
Expenses for purchased services
244,370
240,993
Total
749,247
752,532
11. PERSONEL EXPENSES
The expenses for retirement benefits include the expenditure on benefits as well as the allocations to provisions for defined
benefit plans excluding the interest portion, which is stated under “Interest and similar expenses”.
in EUR ’000
Wages and salaries
Social security contributions
Expenses for retirement benefits
Total
2014
2015
299,785
317,893
49,632
51,608
5,833
6,617
355,250
376,118
The employer's pension contributions in the financial year totaled EUR 21,758 thousand (previous year: EUR 20,653 thousand).
These are contribution-based schemes, as explained under 5.2 Significant accounting policies. Of that total, EUR 16,995
thousand (previous year: EUR 17,411 thousand) relate to Germany and EUR 4,763 thousand (previous year: EUR 3,242
thousand) to Group companies outside of Germany. The wages and salaries include severance payments in the amount of
EUR 1,560 thousand (previous year: EUR 735 thousand).
Income from disposal of property, plant and equipment
2014
2015
in EUR ’000
110
12. DEPRECIATION OF FIXED ASSETS
Depreciation is as follows:
in EUR ’000
Amortization of intangible assets
2014
9,956
2015
10,143
Depreciation of property, plant and equipment
68,825
71,000
Total
78,781
81,143
The impairment losses on fixed assets are explained under item 19.2, Property, plant and equipment and investment property.
13. WRITE-DOWNS OF INVENTORIES DUE TO USE
Write-downs of inventories due to use in the financial year totaled EUR 13,195 thousand (previous year: EUR 15,789 thousand).
This related to write-downs of used machinery temporarily hired out to customers as sales promotion measures. Write-downs
of used machinery disposed of in the 2015 financial year are included in these figures.
14. OTHER OPERATING EXPENSES
in EUR ’000
Losses from disposal of property, plant and equipment
Rents and leases
Energy, heating, water
Vehicle costs
2014
2015
675
1,042
21,360
27,152
6,291
6,385
6,755
7,646
Property, motor and transport insurance
10,096
10,411
35,766
35,604
Administrative expenses
41,513
40,619
Distribution costs
33,304
35,844
Other employee-related expenses
17,208
19,408
Realized and unrealized foreign currency losses
19,948
49,199
Valuation allowance of receivables
6,392
9,424
Bank charges
3,284
2,732
Duties
3,411
2,028
Additional other operating expenses
Total
24,523
26,741
230,526
274,235
The “Additional other operating expenses” mainly comprise allocations to and reversal of provisions affecting net income,
losses from foreign exchange forward contracts as well as additional other operating expenses spread across the consolidated companies which are of minor importance in the individual instances. The other employee-related expenses include
education and training costs, grants and gifts, travel and relocation expenses, and other project-specific personnel costs.
111
FINANCIAL RESULT
15. FINANCIAL INCOME
in EUR ’000
Income from operating investments
2014
14
2015
59
Other interest and similar income
5,287
3,798
Income from changes in fair values of interest rate swaps
1,795
1,115
Total
7,096
4,972
16. FINANCIAL EXPENSES
The financial expenses are broken down as follows:
in EUR ’000
Interest and similar expenses
Losses from changes in fair values of interest rate swaps
Interest portions of allocations to provisions for defined benefit plans and similar obligations
2015
36,648
796
2,905
3,080
2,429
45,149
41,982
2015
Total
2014
41,273
The financial income is broken down as follows:
The interest from finance leases included under “Interest and similar expenses” in the financial year totaled EUR 869 thousand
(previous year: EUR 988 thousand). The financial result includes interest income from financial assets in an amount of EUR 3,762
thousand (previous year: EUR 5,278 thousand) and interest expenses from financial liabilities in an amount of EUR 35,779
thousand (previous year: EUR 40,285 thousand) which were not measured at fair value affecting profit and loss.
The interest and similar expenses include impairment losses on financial assets held for sale in an amount of EUR 162 thousand
(previous year: EUR 705 thousand). Of this amount, EUR 14 thousand (previous year: EUR 631 thousand) relates to the
Construction segment, EUR 0 (previous year: EUR 9 thousand) to the Equipment segment and EUR 148 thousand (previous
year: EUR 65 thousand) to the Resources segment.
17. INCOME TAX EXPENSE
The income tax expense is broken down as follows:
in EUR ’000
Actual taxes
Deferred taxes
Total
The theoretical tax rate is 28.08 percent (previous year: 28.08 percent).
2014
2015
19,721
21,438
2,354
5,955
22,075
27,393
112
Reconciliation from expected to actual income tax expenditure
The expected tax expenditure is below the recorded tax expenditure. The reasons for the difference between the expected and
recorded tax expenditure are as follows:
in EUR ’000
2014
2015
Earnings before tax
37,801
56,385
Theoretical tax expenditure 28.08 percent (previous year: 28.08 percent)
10,615
15,833
Differences in tax rate
-1,534
1,313
Taxation effects of non-deductible expenses and tax-free income
-4,869
-10,481
2,000
1,594
At-equity valuation of associated companies
160
-750
Out-of-period tax payments/refunds for previous years
-68
977
15,701
18,950
70
-43
22,075
27,393
Effects of variations in the tax calculation base
Effects of deferred tax assets in respect of losses carried forward and temporary differences
Other
Income tax expense
The tax effects of the non-deductible expenses and tax-free earnings contain effects from transitional and de-consolidations in
the amount of EUR -12,153 thousand (previous year: EUR -6,548 thousand).
Internal disbursements result in taxation effects after December 31, 2015 totaling EUR 31 thousand (previous year: EUR 39
thousand).
18. EARNINGS PER SHARE
The earnings per share are calculated by dividing the net result attributable to the shareholders of BAUER AG by the weighted
average number of ordinary shares outstanding. The earnings per share amount to the following values:
2014
Net result attributable to the shareholders of BAUER AG, in EUR '000
2015
14,481
29,715
Number of shares from 01.01. to 31.12.
17,131,000
17,131,000
Weighted average number of shares in circulation in financial year (basic)
17,131,000
17,131,000
Weighted average number of shares in circulation in financial year (diluted)
17,131,000
17,131,000
Basic earnings per share in EUR
0.85
1.73
Diluted earnings per share in EUR
0.85
1.73
113
EXPLANATORY NOTES TO THE BALANCE SHEET
The breakdown of the fixed asset items summarized on the balance sheet and their development is presented in the fixed asset
movement schedule on the following pages.
19.1 Intangible assets
Internally generated
intangible assets
in EUR ’000
Cost of purchase/cost of manufacturing
Jan. 1, 2014
Change in scope of consolidation
Licenses, software
and similar rights
and values
Goodwill
Capitalized
software costs
33,078
2,186
357
Capitalized
development costs
Total
39,354
74,975
-17
0
0
0
-17
Additions
2,422
0
0
6,186
8,608
Disposals
2,392
0
68
0
2,460
Transfers
Currency adjustment
Dec. 31, 2014
-6
0
0
22
16
452
0
0
6
458
33,537
2,186
289
45,568
81,580
intangible assets
in EUR ’000
Accumulated depreciation
Jan. 1, 2014
Licenses, software
and similar rights
and values
Goodwill
22,040
2,186
Capitalized
software costs
267
Capitalized
development costs
Total
15,094
39,587
-6
0
0
0
-6
Additions
3,681
0
51
6,224
9,956
Disposals
2,619
0
68
0
2,687
Transfers
4
0
0
0
4
281
0
0
5
286
Dec. 31, 2014
23,381
2,186
250
21,323
47,140
Carrying amount Dec. 31, 2014
10,156
0
39
24,245
34,440
Currency adjustment
intangible assets
in EUR ’000
Jan. 1, 2015
Licenses, software
and similar rights
and values
Goodwill
Capitalized
software costs
Capitalized
development costs
Total
33,537
2,186
289
45,568
81,580
-443
0
0
-10,514
-10,957
Additions
3,019
0
0
4,792
7,811
Disposals
205
0
207
303
715
Transfers
Currency adjustment
Dec. 31, 2015
1
0
0
0
1
309
0
0
-9
300
36,218
2,186
82
39,534
78,020
2015
19. FIXED ASSETS
NON-CURRENT ASSETS
114
intangible assets
in EUR ’000
Licenses, software
and similar rights
and values
Jan. 1, 2015
Goodwill
Capitalized
software costs
Capitalized
development costs
Total
23,381
2,186
250
21,323
47,140
-305
0
0
-6,038
-6,343
Additions
3,787
0
28
6,328
10,143
Disposals
189
0
207
165
561
Transfers
Currency adjustment
Dec. 31, 2015
0
0
0
0
0
194
0
0
-8
186
26,868
2,186
71
21,440
50,565
9,350
0
11
18,094
27,455
The changes to the basis of consolidation mainly comprise intangible assets from the de-consolidation of BAUER Deep
Drilling GmbH, Schrobenhausen, with a carrying amount of EUR 4,165 thousand.
Of the total research and development costs and patent costs incurred in 2015, EUR 4,936 thousand (previous year:
EUR 6,247 thousand) met the capitalization criteria in accordance with IFRS. The following amounts were recognized
in net income:
in EUR ’000
Research costs and non-capitalized development costs
Amortization of development costs and patents
Research and development costs recognized in net income
2014
2015
18,567
19,470
6,473
6,528
25,040
25,998
115
19.2 Property, plant and equipment and investment property
Land and
buildings
Jan. 1, 2014
302,284
Investment
property
1,763
488,855
73,032
5,282
Total
871,216
-563
0
-2,063
-678
0
-3,304
Additions
3,926
6
43,524
7,310
9,322
64,088
Disposals
6,022
0
49,712
6,374
193
62,301
Transfers
765
-35
5,255
-112
-5,889
-16
Currency adjustment
Dec. 31, 2014
5,802
0
27,331
2,119
-309
34,943
306,192
1,734
513,190
75,297
8,213
904,626
in EUR ’000
Jan. 1, 2014
Land and
buildings
Investment
property
Payments on
Technical
Other equipment,
account and
equipment and factory and office assets in course
machinery
equipment
of construction
Total
90,707
900
274,359
45,713
0
411,679
-5
0
-773
-485
0
-1,263
Additions
10,042
36
49,829
8,918
0
68,825
Disposals
2,000
0
32,386
5,366
0
39,752
Transfers
Currency adjustment
Dec. 31, 2014
of which finance lease,
carrying amount Dec. 31, 2014
6
-6
168
-172
0
-4
866
0
15,784
1,582
0
18,232
99,616
930
306,981
50,190
0
457,717
206,576
804
206,209
25,107
8,213
446,909
2,935
0
19,150
5,122
0
27,207
in EUR ’000
Cost of purchase/
cost of manufacturing
Land and
buildings
Jan. 1, 2015
306,192
Investment
property
1,734
Payments on
Technical
Other equipment,
account and
machinery
equipment
of construction
513,190
75,297
Total
8,213
904,626
-28,058
0
-4,431
-407
-401
-33,297
Additions
4,499
15
59,539
11,083
8,031
83,167
Disposals
4,378
0
66,925
7,318
30
78,651
Transfers
4,794
0
4,766
146
-9,707
1
Currency adjustment
Dec. 31, 2015
3,994
0
17,562
1,392
-444
22,504
287,043
1,749
523,701
80,193
5,662
898,348
Cost of purchase/
cost of manufacturing
Payments on
Technical
Other equipment,
account and
machinery
equipment
of construction
2015
in EUR ’000
116
in EUR ’000
Land and
buildings
Jan. 1, 2015
99,616
Investment
property
Payments on
Technical
Other equipment,
account and
machinery
equipment
of construction
930
306,981
50,190
0
Total
457,717
-4,209
0
-3,359
-459
-64
-8,091
Additions
9,661
35
52,350
8,954
0
71,000
Disposals
2,745
0
29,002
5,846
0
37,593
Transfers
0
0
0
0
0
0
Currency adjustment
488
0
9,418
989
64
10,959
Dec. 31, 2015
102,811
965
336,388
53,828
0
493,992
184,232
784
187,313
26,365
5,662
404,356
1,687
0
16,231
5,940
0
23,858
of which finance lease, carrying
amount Dec. 31, 2015
The changes to the basis of consolidation comprise disposals of property, plant and equipment from the de-consolidation
of BAUER Manufacturing LLC, Conroe in the amount of EUR 26,271 thousand, SPANTEC Spann- & Ankertechnik GmbH,
Schrobenhausen, in the amount of EUR 425 thousand, and BAUER Deep Drilling GmbH, Schrobenhausen, in the amount of
EUR 97 thousand, as well as the initial consolidation of BAUER Equipment India Private Limited, Delhi, BAUER Equipment
Australien Pty. Ltd., Baulkham Hills, BAUER Resources Maroc S.A.R.L., Kenitra, and BAUER Resources Senegal SARL,
Dakar, with an addition of property, plant and equipment totaling EUR 1,587 thousand.
There are purchase options, which will be executed, for the majority of buildings and equipment subject to finance lease
contracts. The underlying interest rates of the contracts vary between 1.43 % and 7.50 % (previous year: 2.38 % and 7.89 %),
depending on the market and time of the conclusion of the contract. The lease payments due in the future and their present
values are stated in the following table:
Remaining term 2015
Remaining term 2014
in EUR ’000
under 1 year 1 to 5 years over 5 years
Minimum lease payments
8,470
Interest portions
Present value
Total
13,707
0
22,177
1,017
675
0
1,692
7,453
13,032
0
20,485
under 1 year 1 to 5 years over 5 years
9,606
Total
13,120
0
22,726
661
468
0
1,129
8,945
12,652
0
21,597
The investment property has a market value of EUR 784 thousand (previous year: EUR 804 thousand) and was leased at
all times in 2015. It includes a hotel owned by SCHACHTBAU NORDHAUSEN GmbH, leased to third parties and depreciated
over a period of 48 years. Die SCHACHTBAU NORDHAUSEN GmbH also has a contractual obligation to maintain the property.
The measurement is derived from current market prices for similar property. This method is part of level 2 of the fair value
hierarchy stated in IFRS 13.
Rental income in the amount of EUR 51 thousand (previous year: EUR 60 thousand) was generated in the reporting period,
which are directly offset by operating expenses in the amount of EUR 14 thousand (previous year: 23 thousand).
Items of property, plant and equipment have a carrying amount of EUR 112,090 thousand (previous year: EUR 105,811 thousand)
and are subject to encumbrances such as mortgages and chattel mortgages. There are also common restraints on disposal on
leased assets, which are allocable to the Group (finance lease) in accordance with IAS 17 and amount to EUR 23,858 thousand
(previous year: EUR 27,207 thousand).
Olbersdorfer Guß GmbH was granted investment subsidies for expanding production in the amount of EUR 0 (previous year:
EUR 13 thousand) in the financial year. all of the covenants of the investment subsidies were met as of the balance sheet date.
117
No borrowing costs were capitalized in the financial year (previous year: none). Fixed assets were impaired by a total of
EUR 864 thousand (previous year: EUR 1,775 thousand) in the financial year. Of these impairments, EUR 89 thousand
(previous year: EUR 0) related to the Construction segment, EUR 765 thousand (previous year: EUR 1,768 thousand) to
the Equipment segment and EUR 10 thousand (previous year: EUR 7 thousand) to the Resources segment. Of the amount,
development costs in the amount of EUR 489 thousand at KLEMM Bohrtechnik GmbH and MAT Mischanlagentechnik,
branch offices of BAUER Maschinen GmbH, in the Equipment segment. The expected market development for various
internally developed devices was the key factor in this respect. Impairment losses on property, plant and equipment pertain to
technical equipment and machinery to the amount of EUR 94 thousand and to company and office equipment to the amount of
EUR 2 thousand. The impairments were applied on the basis of the recoverable amount. For the capitalized development costs,
this corresponded with the value in use. A discount rate of 7.72 % (previous year: 7.83 %) was applied in the financial year. The
recoverable amount of other non-financial assets regularly corresponded with the fair value less cost to sell. This method is part
of level 1 of the fair value hierarchy stated in IFRS 13.
19.3 Shares accounted for using the equity method and participations
The balance sheet approaches of the joint ventures and associated companies developed as follows:
in EUR ’000
Shares in joint ventures accounted for using the equity method
Dec. 31, 2014
Dec. 31, 2015
4,175
94,226
Shares in associated companies accounted for using the equity method
38,731
38,327
Total
42,906
132,553
The following table provides an overview of the changes in shares accounted for using the equity method:
in EUR ’000
Jan. 1
Additions
Disposals
Joint ventures
2015
2014
9,947
40,916
3,302
4,175
31,089
0
662
90,863
2014
2015
0
0
479
1,563
330
764
690
751
-450
-1,168
0
0
Transfers
0
0
0
0
Currency adjustment
0
0
0
0
40,916
40,512
4,175
94,226
Profit/loss attributable
Dividend payments
Dec. 31
in EUR ’000
Jan. 1
2014
Joint ventures
2015
2014
2015
0
2,185
0
0
Additions
2.185
0
0
0
Disposals
0
0
0
0
Transfers
0
0
0
0
Currency adjustment
0
0
0
0
Dec. 31
Carrying amount Dec. 31
2,185
2,185
0
0
38,731
38,327
4,175
94,226
2015
EUR 833 thousand) to property, plant and equipment. The majority of impairments on intangible assets relates to capitalized
EUR 768 thousand (previous year: EUR 942 thousand) pertained to intangible assets and EUR 96 thousand (previous year:
118
a) Joint ventures
The amounts stated in the financial information for joint ventures are recognized in the annual financial statements prepared in
accordance with local financial reporting standards, corrected by any adjustments to IFRS.
With the basic joint ventures, details on previous year values were no longer required as they were already fully consolidated
at that point in time.
These are the material joint ventures:
Financial year 2014:
There were no material joint ventures in financial year 2014.
Name
Company's
activities
Headquarters
Capital
share
SPANTEC Spann- & Ankertechnik GmbH
Production
Schrobenhausen, Germany
40 %
BAUER Manufacturing LLC
Production
Conroe, USA
51 %
At equity
BAUER Deep Drilling GmbH
Production
Schrobenhausen, Germany
51 %
At equity
Valuation method
At equity
Summarized financial information on the material joint ventures (before consolidation):
BALANCE SHEET
SPANTEC Spann& Ankertechnik GmbH
in EUR ’000
2014
2015
2014
2015
2014
2015
Non-current assets
0
5,473
0
26,683
0
15,504
Current assets
0
8,246
0
42,037
0
52,799
0
4,299
0
24,676
0
34,172
Total assets
0
13,719
0
68,720
0
68,303
Non-current debt
0
153
0
16
0
495
of which cash and cash equivalents
of which non-current financial liabilities
Current debt
of which current financial liabilities
Total liabilities
0
0
0
16
0
23
0
1,325
0
18,671
0
17,887
0
0
0
0
0
10
0
1,478
0
18,687
0
18,382
Non-current and current financial liabilities do not contain any trade payables and provisions.
SPANTEC Spann& Ankertechnik GmbH
in EUR ’000
2014
2015
2014
2015
2014
2015
Sales revenues
0
5,854
0
511
0
245
Scheduled depreciation and amortization
0
-105
0
-51
0
-81
Operating result
0
1,825
0
-248
0
-283
Interest income
0
9
0
0
0
0
Interest expense
0
-25
0
-12
0
0
Income tax expense
0
-469
0
0
0
79
0
1,340
0
-260
0
-204
0
0
0
0
0
-68
0
1,340
0
-260
0
-272
Dividends distributed to the
BAUER Group
0
0
0
0
0
0
The amounts stated in the financial information for joint ventures are recognized in the annual financial statements prepared
2015
in accordance with local financial reporting standards, corrected by any adjustments to IFRS.
Summarized financial information on the immaterial joint ventures (before consolidation):
BALANCE SHEET
in EUR ’000
Non-current assets
Current assets
Total assets
Joint ventures
Dec. 31, 2014
317
986
57,402
2,445
2,150
64,113
58,388
0
0
0
0
55,646
52,460
43,607
29,662
55,646
52,460
Total debt
Dec. 31, 2015
63,796
Non-current debt
Current debt
Non-current and current financial liabilities do not contain any trade payables and provisions.
INCOME STATEMENT
in EUR ’000
Joint ventures
2014
2015
41,008
64,418
-373
-2,141
Operating result
3,529
1,884
Interest income
1
9
Interest expense
-4
-53
0
-20
3,526
1,820
0
0
Sales revenues
Income tax expense
Dividends distributed to the BAUER Group
INCOME STATEMENT
119
120
Reconciliation to the summarized financial information on the immaterial joint ventures
The proportional carrying amount of the joint ventures can be offset and reconciled as follows:
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
Net assets of joint ventures
8,467
Share in joint ventures according to investment quota
4,175
59,166
0
35,060
4,175
94,226
Goodwill and other adjustments
Carrying amount reported in the balance sheet
118,135
Market value of the material joint ventures:
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
SPANTEC Spann- & Ankertechnik GmbH
0
25,500
0
86,429
0
70,714
We did not state the fair value of our immaterial joint ventures as there is no listed market price.
The risk arising from the joint and several liability in the case of a shareholder defaulting is secured by mutual guarantees
issued within the joint venture. There are no other obligations or material restrictions.
b) Associated companies
The amounts stated in the financial information for associated companies are recognized in the annual financial statements
prepared in accordance with local financial reporting standards, corrected by any adjustments to IFRS.
These are the material associated companies:
Name
Wöhr + Bauer GmbH
NDH Entsorgungsbetreibergesellschaft mbH
TERRABAUER S. L.
BAUER Nimr LLC
Company's
activities
Headquarters
Capital share
Project development
Munich, Germany
33.33 %
Waste disposal
Bleicherode, Germany
25.00 %
Specialist foundation engineering
Madrid, Spain
30.00 %
Water treatment and
soil remediation
Maskat, Al Mina,
Sultanate of Oman
49.00 %
Company's
activities
Headquarters
Capital share
Project development
Munich, Germany
33.33 %
Name
Wöhr + Bauer GmbH
TERRABAUER S. L.
BAUER Nimr LLC
Disposal
Bleicherode, Germany
25.00 %
Madrid, Spain
30.00 %
Water treatment and
soil remediation
Maskat, Al Mina,
Sultanate of Oman
49.00 %
121
Summarized financial information for all associated companies (amounts before consolidation):
in EUR ’000
Wöhr + Bauer GmbH
TERRABAUER S. L.
BAUER Nimr LLC
Dec. 31, 2014 Dec. 31, 2015 Dec. 31, 2014 Dec. 31, 2015 Dec. 31, 2014 Dec. 31, 2015 Dec. 31, 2014 Dec. 31, 2015
Non-current assets
60,132
56,795
18,288
17,040
2,671
-
41,102
43,074
Current assets
48,073
101,161
26,857
28,532
11,407
-
13,187
11,660
526
2,275
23,060
24,098
23
-
5,019
2,013
108,205
157,956
45,145
45,572
14,078
-
54,289
54,734
22,279
87,658
0
0
771
-
35,421
36,563
21,897
36,125
0
0
90
-
34,968
22,146
66,775
53,706
40,225
41,056
6,542
-
7,299
8,560
0
35,980
3,225
2,833
575
-
2,327
2,845
89,054
141,364
40,225
41,056
7,313
-
42,720
45,123
(of which cash and
cash equivalents)
Total assets
Non-current debt
of which non-current
financial debt
Current debt
of which current
financial debt
Total debt
* Financial information was unavailable on the balance sheet date
in EUR ’000
Wöhr + Bauer GmbH
TERRABAUER S. L.
2014
2015
2014
2015
Sales revenues
21,531
17,217
22,736
22,951
470
Scheduled depreciation
and amortization
-1,774
-1,924
-2,956
-3,223
2,550
-2,700
1,522
1,451
Operating result
Interest income
2014
BAUER Nimr LLC
2015 *
2015
INCOME STATEMENT
2014
2015
-
1,528
11,026
-589
-
-367
-242
-695
-
281
5,725
15
2
238
52
64
-
6
2,148
Interest expense
-414
-927
-262
-271
-93
-
-244
-3,209
Income tax expense
-667
1,372
-509
-648
0
-
0
-699
1,484
-2,322
989
584
-724
-
43
3,965
494
-774
247
146
0
-
21
1,943
0
0
0
0
0
-
0
0
1,484
-2,322
989
584
-724
-
43
3,965
210
100
240
247
0
-
4,598
821
in proportion to share
Dividends distributed
to the BAUER Group
* Financial information was unavailable on the balance sheet date
BALANCE SHEET
122
Summarized financial information for associated companies, which are immaterial on their own (amounts before consolidation):
BALANCE SHEET
in EUR ’000
Dec. 31, 2014
Non-current assets
Current assets
51
239
228
33
4
306
279
22
18
22
0
132
130
0
0
154
148
Total assets
Non-current debt
Current debt
Total debt
INCOME STATEMENT
in EUR ’000
Dec. 31, 2015
67
Dec. 31, 2014
Dec. 31, 2015
Sales revenues
825
853
-29
-24
Operating result
-22
-9
Interest income
0
0
Interest expense
-1
-2
0
0
-23
7
Income tax expense
Net result for the period in proportion to share
Dividends distributed to the BAUER Group
-7
2
0
0
Reconciliation to the summarized financial information on associated companies
The proportional carrying amount of the associated companies can be offset and reconciled as follows:
in EUR ’000
Net assets of associated companies
Dec. 31, 2014
Dec. 31, 2015
35,792
30,850
Share in associated companies according to investment quota
13,331
11,408
Goodwill and other adjustments
16,908
16,887
Cash value of concession arrangement
Currency adjustment
Carrying amount reported in the balance sheet
8,709
8,162
-217
1,870
38,731
38,327
The other adjustments pertain to temporal differences in reporting.
The market value of BAUER Nimr LLC was EUR 75,862 thousand (previous year: EUR 63,447 thousand) on December 31, 2015.
The market values of the other material associated companies were unavailable on the balance sheet date.
There were no obligations and material restrictions or risks with regard to the shares in associated companies on the balance
sheet date.
123
c) Participations
2014
2015
4,429
4,429
Additions
0
0
Disposals
0
0
Profit/loss attributable
0
0
Dividend payments
0
0
Transfers
0
0
Jan. 1
Currency adjustment
Dec. 31
0
0
4,429
4,429
Participations
in EUR ’000
2014
Jan. 1
2015
816
816
Additions
0
0
Disposals
0
0
Transfers
0
0
Currency adjustment
0
0
816
816
3,613
3,613
Dec. 31, 2014
Dec. 31, 2015
Dec. 31
Carrying amount Dec. 31
20. DEFERRED TAXES
Deferred tax assets and liabilities pertained to the following balance sheet items:
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
Deferred tax assets
Intangible assets
Inventories
401
389
7,202
18,364
119
123
13,926
8,814
3,763
876
2,498
2,229
1,474
2,521
1,410
4,511
19,652
18,340
208
562
Liabilities
10,201
7,027
4,800
2,711
Tax losses carried forward
12,559
13,617
0
0
3,999
5,366
4,274
4,542
-21,195
-21,069
-21,195
-21,069
30,973
27,190
13,123
20,664
Consolidation
Offsetting
Net amount
In the table above, deferred tax assets in the amount of EUR 222 thousand (previous year: EUR 2,025 thousand) and deferred tax
liabilities in the amount of EUR 11 thousand (previous year: EUR 1,708 thousand) are included in liabilities, which is part of hedgeaccounting. Deferred tax assets in the amount of EUR 14,637 thousand (previous year: EUR 16,772 thousand) and deferred tax
liabilities in the amount of EUR 0 (previous year: EUR 4 thousand) are included in provisions for pensions for the actuarial gains and
losses recognized in equity.
2015
Participations
in EUR ’000
124
The share of current deferred tax assets in respect of losses carried forward amounts to EUR 6,848 thousand (previous year:
EUR 10,039 thousand) and the share of deferred tax liabilities to EUR 8,267 thousand (previous year: 7,280 thousand).
The tax losses carried forward at the end of the year are as follows:
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
Domestic losses (corporation tax)
75,553
80,325
Foreign losses
46,953
120,225
122,506
200,550
25,461
83,203
Total
Of which losses carried forward deductible for limited periods
No deferred taxes were recognized for unusable losses carried forward in the amount of EUR 161,045 thousand (previous year:
EUR 78,059 thousand) due to the medium-term income tax target.
The share of current deferred tax assets in respect of losses carried forward amounted to EUR 1,339 thousand (previous year:
EUR 1,028 thousand) in the financial year.
Deferred tax liabilities arising from temporary differences in connection with investments in subsidiaries and associated
companies are only recognized if the date of reversal of the temporary differences can be determined by the Group and it
is likely that the temporary differences will not be reversed again in the foreseeable future because of this effect. This is not
presently the case.
There are temporary differences in the amount of EUR 1,767 thousand (previous year: EUR 1,170 thousand) in connection
with shares in subsidiaries, for which no deferred tax liabilities were recognized.
21. OTHER NON-CURRENT ASSETS
The other non-current assets comprise the following items:
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
Claims from backup insurance
4,787
4,550
Sundry other non-current assets
2,705
3,172
Total
7,492
7,722
The additional other non-current assets did not incur any interest in the financial and previous year.
They also include assets arising from continuing involvements totaling EUR 1,537 thousand (previous year: EUR 1,068 thousand).
As in the previous year, the other non-current assets were neither impaired nor overdue in the year under review.
Within BAUER Group, trade receivables and services in the amount of EUR 16,263 thousand (previous year:
EUR 18,425 thousand) were sold to third parties within the scope of receivables sales agreements. It comprises
the maximum amount of the remaining risk which the BAUER Group would have to pay to the buyer.
The corresponding liability amounts to EUR 1,691 thousand (previous year: EUR 1,175 thousand), and is stated under
“Other non-current liabilities”. The difference reflects the fair value of the guarantees resulting from the remaining risk and
the servicing, and is recognized in net income.
125
22. OTHER NON-CURRENT FINANCIAL ASSETS
The other non-current financial assets comprise the following:
Remaining term 31.12.2015
over 5 years
1 to 5 years
over 5 years
Sundry other non-current financial assets
18,974
9,446
4,805
10,550
Total
18,974
9,446
4,805
10,550
Die Additional other non-current assets contain receivables from derivatives and other non-current financial assets.
The derivatives are presented in item 36 under “Other disclosures”. The item also contains a loan receivable from
BAUER Nimr LLC in the amount of EUR 10,550 thousand (previous year: EUR 9,446 thousand). As in the previous year,
the other non-current financial assets were neither impaired nor overdue in the year under review.
CURRENT ASSETS
23. INVENTORIES
The inventories comprise the following items:
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
Raw materials and supplies
155,334
155,718
Finished goods and work in progress and stock for trade
283,850
288,911
Total
439,184
444,629
Of the inventories, EUR 144,066 thousand (previous year: EUR 121,319 thousand) are stated at net realizable value.
The impairment losses on inventories against the net realizable value affecting net expenditure in the financial year totaled
EUR 25,344 thousand (previous year: EUR 24,386 thousand).
They are divided up as follows:
in EUR ’000
Impairment losses on inventories
Total
Dec. 31, 2014
Dec. 31, 2015
15,789
13,195
8,597
12,149
24,386
25,344
The rate of hire during the financial year was lower than in the previous year. Write-downs of used machinery due to use
therefore decreased from EUR 15,789 thousand to EUR 13,195 thousand. The number of leased machines increased again
at the end of the year.
The impairment losses on inventories include both impairment losses on new and used machinery (stated under “Changes
in inventories”) and on warehouse inventories (stated under “Cost of materials”). Most of the impairment losses relate to the
machinery which was not hired out, and are attributable to the Equipment segment. The impairments were applied on the
basis of the recoverable amount. This regularly corresponded to the fair value less cost to sell. This method is part of level 1
of the fair value hierarchy stated in IFRS 13.
The finished goods and merchandise include machinery and accessories produced internally by the Equipment segment
and intended primarily for sale.
Remaining term 31.12.2014
1 to 5 years
2015
in EUR ’000
126
We differentiate essentially between two forms of machinery and accessories (referred to in the following as “machinery”):
New machines
These are machines manufactured in the financial year or in earlier years which are available for sale but have not yet been
hired out. These machines are valued at manufacturing cost or at the lower net realizable value on the balance sheet date.
Used machines
Used machines are machines which are primarily up for sale and which have been temporarily hired out as a secondary sales
promotion measure during the financial year or in earlier years. New machines automatically become used machines the first
time they are hired out.
When hiring out machinery, the net realizable value is determined from the manufacturing cost less the write-downs due to
use and impairment losses on inventories.
In the case of a new machine, or a used machine which has not been hired out, the reduction in value against the net realizable
value is recognized by means of an impairment loss.
The sale and hire of machinery relates solely to the Equipment segment.
The following chart sets out the carrying amount before impairment of the used machinery and accessories along with the rate of
hire status on the balance sheet date:
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
Carrying amount of used machines
86,744
98,291
of which hired out
32,236
44,990
of which not hired out
54,508
53,301
In the financial year, apart from the usual retentions of title, inventories totaling EUR 460 thousand (previous year: EUR 119
thousand) with terms up until the year 2016 were provided as security for loans. The securities provided can only be claimed
by the lending banks in the event of definitive failure to fulfill contractual obligations, such as defaulting on interest and loan
payments or failure to meet agreed financial targets. No claims on securities provided are foreseeable.
24. RECEIVABLES AND OTHER ASSETS
Construction contracts
The construction contracts measured according to the percentage of completion method developed as follows:
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
Contract costs incurred (plus profits, less losses) for projects not yet completed
674,169
783,992
less down-payments
590,481
704,396
Balance
of which: Receivables from construction contracts (PoC)
of which: Liabilities from construction contracts (PoC)
83,688
79,596
132,159
129,478
48,471
49,882
127
Development of receivables and other assets
The receivables and other assets comprise the following:
Dec. 31, 2015
132,159
129,478
Trade receivables
311,417
343,933
67
3,272
Receivables from enterprises in which the company has participating interests
Payments on account
4,304
5,364
Other current assets
28,603
33,381
Other current financial assets
20,100
28,901
496,650
544,329
Total
The “Trade receivables” balance sheet item includes long-term receivables totaling EUR 8,845 thousand (previous year:
EUR 10,504 thousand).
The following table presents the changes in valuation allowances to current receivables:
in EUR ’000
Valuation allowance at start of financial year
Dec. 31, 2014
Dec. 31, 2015
59,938
53,976
0
0
842
399
Allocation
20,568
28,476
Reversal
19,557
19,500
Currency adjustment
Consumption
Valuation allowance at end of financial year
7,815
2,075
53,976
61,276
The valuation allowance for foreseeably uncollectable trade receivables of EUR 61,276 thousand (previous year: EUR 53,976
thousand) was calculated taking into account individual risks and on the basis of past experience in relation to payment
default. Valuation allowance were applied in respect of individual claims as well as on a portfolio flat-rate basis. The individual
valuation allowances were translated into flat-rate percentages spread across the age structure of the receivables. Within the
individual valuation allowance, 100 percent of the claim receivable was usually adjusted. The determination of valuation allowances for uncertain receivables primarily bases on estimates and evaluations of individual claims, incorporating considerations
of the creditworthiness and late-payment record of the customer concerned as well as current economic trends and historical
experience in relation to default.
No receivables from construction contracts were impaired in the financial year (previous year: EUR 3,993 thousand).
Dec. 31, 2014
Receivables from construction contracts (PoC)
2015
in EUR ’000
128
The following table presents an analysis of the due dates of gross carrying amounts of trade receivables:
Carrying amount Carrying amount
Dec. 31, 2014
Dec. 31, 2015
in EUR ’000
Trade receivables (gross carrying amount)
365,393
405,209
53,976
61,276
311,417
110,640
200,777
343,933
158,004
185,929
- less than 30 days
75,046
59,694
- between 30 and 60 days
13,599
21,248
- between 60 and 90 days
10,886
10,235
101,246
94,752
Valuation allowance in respect of trade receivables
Trade receivables (net carrying amount)
of which neither impaired nor overdue at closing date
of which not impaired at closing date and overdue in the following time bands:
- more than 90 days
The above table includes trade receivables as well as receivables from joint ventures. With regard to the trade receivables which
were neither impaired nor delayed in payment, there were no indications at the balance sheet date that the debtors concerned will
not fulfill their payment obligations. Credit ratings are derived from an active system of claims management with reference to the
relevant credit history and from continuous monitoring of the creditworthiness of our customers based on information obtained
from both internal and external sources.
Other current assets were neither impaired nor overdue in the year under review. Other current assets mainly comprise
miscellaneous tax refund claims and claims against employees and against welfare benefit funds as well as accrued interest
and insurance premiums and other prepayments and deferred charges.
A total of EUR 83 thousand (previous year: EUR 6,846 thousand) monetary assets were deposited as collateral for potential
future warranties for construction activities. The current portion of the receivables from foreign exchange forward contracts
included in the current financial assets in the financial year totaled EUR 2,853 thousand (previous year: EUR 141 thousand).
In financial year 2015, total impairments amounted to EUR 32,068 thousand (previous year: EUR 20,568 thousand). Contained
in this are EUR 3,593 thousand (previous year: 411 thousand) of impairments for uncollectable receivables.
25. CASH AND CASH EQUIVALENTS
The cash and cash equivalents totaling EUR 47,406 thousand (previous year: EUR 41,835 thousand) include credit balances
at banks and petty cash stocks.
26. EQUITY
The shareholder structure of BAUER AG is as follows:
%
Bauer family
Free float
Total
Dec. 31, 2015
Dec. 31, 2014
in EUR ’000
48.19
EUR '000
%
EUR '000
35,182
48.19
35,182
51.81
37,819
51.81
37,819
100.00
73,001
100.00
73,001
129
Please refer to the Notes to the Financial Statements of BAUER AG (published in the Federal Gazette (Bundesanzeiger)) on
December 31, 2015 for reports on the participations in BAUER AG.
Composition of subscribed capital
have no nominal value. Each share entails equal rights, and entitles the holder to one vote at the Annual General Meeting, with
the exception of share categories precluded from voting by law pursuant to section 136 of the German Stock Corporation Act
(AktG) and section 28 of the German Securities Trading Act (WpHG).
As in the previous year, 51.81 percent of the shares were in free float. The members of the Bauer family and a charitable
foundation own a total of 8,256,246 no-nominal-value shares in BAUER AG on the basis of a pool agreement, representing
a 48.19 percent share in the company. The pool agreement provisions include binding voting commitments as well as a right of
pre-emption of pool participants if any member of the pool sells shares to third parties. No other direct or indirect holdings of
BAUER AG share capital exceeding 10 % of the voting rights are known to the company.
None of the shareholders have special rights entailing controlling powers. Nor does any voting rights control exist on the part
of the employees holding shares in the capital.
Authority of the Management Board to issue or buy back shares
Section 4, subsection 4 of the company’s Articles of Association authorizes the Management Board, with the consent of the
Supervisory Board, to increase the share capital once or more than once up to June 27, 2017 by up to a total of EUR 7.3 million
by the issue of new ordinary bearer shares against cash and/or non-cash contributions. To that end, the Management Board is
authorized, with the consent of the Supervisory Board, to exclude the legal subscription rights of shareholders in the following
cases:
• in the event of capital increases against non-cash contributions;
• in the event of capital increases against cash contributions where the issue amount of the new shares issued is not
materially below the market price of the already quoted shares at the time of definitive setting of the issue price and
the shares issued excluding shareholders’ subscription rights pursuant to section 186, subsection 3, clause 4 AktG do
not in total exceed 10 % of the existing share capital either at the time this authority takes effect or at the time of exercising
this authority. Shares which have been or are to be sold or issued in direct or corresponding application of section 186,
subsection 3, clause 4 AktG while this authority is in place until such time as it is exercised, pursuant to other authorities,
excluding subscription rights, are to be set off against the said 10 % limit;
• to balance out fractional amounts.
By resolution of the Ordinary Annual General Meeting held on June 26, 2014, the company was authorized to acquire treasury
stock, over a limited period up to June 25, 2019, representing up to a total of 10 % of the company’s share capital at the time
the resolution was passed. The shares shall be acquired at the discretion of the Management Board by means of a public tender
offer or by way of the stock market. If the acquisition is effected by way of the stock market, the acquisition price (excluding
ancillary costs) may be no more than 10 % above or 20 % below the price determined by the opening auction on the trading
day for shares in the company in Xetra trading (or a comparable successor system) on the Frankfurt Stock Exchange. that
if the acquisition is effected by means of a public tender offer, the purchase price or the limits of the purchase price span per
share (excluding ancillary costs) may be no more than 10 percent above or 20 percent below the average of the closing prices
per share in the company in Xetra trading (or a comparable successor system) on the Frankfurt Stock Exchange on the three
trading days prior to the day of issue of the public tender offer. If not insignificant variations of the decisive share price occur
after the day of issue of the public tender offer, the purchase price may be adjusted.
2015
value bearer shares, representing a pro rata amount of approximately EUR 4.26 pershare of the total share capital. the shares
The subscribed capital (share capital) of BAUER AG amounts to EUR 73,001,420.45 and is divided into 17,131,000 no-nominal-
130
The Management Board shall be authorized to appropriate shares in the company acquired pursuant to the above authorizations
for all legally admissible purposes. Consequently, the acquired shares may also in particular be sold by means other than by
way of the stock market or by means of an offer to the shareholders, if the shares are sold for cash at a price (excluding ancillary
costs) not materially below the stock market price of shares of the company carrying the same rights at the time of the sale
in Xetra trading (or a comparable successor system). The shares may also be transferred to third parties, provided this is done
for the purpose of acquiring companies, parts in companies or investments in companies or other assets or effecting company
mergers. The aforementioned shares may be withdrawn without need of a further resolution by the Annual General Meeting.
With regard to use of the bought-back shares, the authorization provides, in specific cases, for legal rights of subscription of
shareholders to be excluded. The facility to acquire treasury stock has not been utilized to date.
The Supervisory Board is authorized to amend Article 4 of the Articles of Association accordingly following complete or partial
execution of the increase in share capital or on expiration of the period of authority.
The remaining shareholders' equity of the BAUER Group developed as follows:
in EUR ’000
I. Capital reserve
II. Other revenue reserves and unappropriated net profit
III. Non-controlling interests
Total
Dec. 31, 2014
Dec. 31, 2015
38,404
38,404
287,903
327,437
326,307
365,841
19,617
12,368
345,924
378,209
In the financial year a dividend of EUR 0.15 (previous year: EUR 0.00) per share was paid to the shareholders.
131
26.1 Non-controlling interests
a) Details on the not wholly owned%igen subsidiaries in which material non-controlling interests are held
Shareholding
in %
Profit/loss
Share- attributable
holding
(in EUR
in EUR '000
'000)
Shareholding
in %
Profit/loss
Share- attributable
holding
(in EUR
in EUR '000
'000)
BAUER Maschinen GmbH, Schrobenhausen,
Deutschland
BAUER
Anteilspool GbR
1.00
1,837
122
1.00
1,498
122
BAUER EGYPT S.A.E, Cairo,
Egypt
Various
natural persons
44.25
11,268
939
44.25
13,068
2,584
BAUER-DE WET EQUIPMENT (PROPRIETARY)
LIMITED, Rasesa, Botswana
De Wet Drilling
(Pty.) Ltd.
49.00
47
-490
49.00
-957
-1,093
Emiroglu
Makina
40.00
1,185
184
40.00
1,278
303
Celler Brunnenbau
Holding GmbH
10.00
638
-262
10.00
469
-499
Oweis
family
16.67
-183
104
16.67
-7,218
-2,376
BAUER Casings Makina Sanayi ve Ticaret
Limited Sirketi, Ankara, Turkey
PRAKLA Bohrtechnik GmbH, Peine,
Deutschland
Site Group for Services and Well Drilling Ltd. Co.,
Amman, Jordan
Individual immaterial subsidiaries with
non-controlling interests
Total
4,825
648
4,230
236
19,617
1,245
12,368
-723
The previous year's financial statements separately stated BAUER Nimr LLC with a share in earnings of EUR 939 thousand and
OOO BAUER Maschinen - Kurgan with a share in capital of EUR 841 thousand and a share in earnings of EUR -372 thousand.
Below is the summarized financial information for each Group company with material non-controlling interests corresponding
to the amounts before Group-internal elimination:
BALANCE SHEET
in EUR ’000
Non-current assets
BAUER Maschinen GmbH
BAUER EGYPT S.A.E.
Dec. 31, 2014 Dec. 31, 2015 Dec. 31, 2014 Dec. 31, 2015
154,631
BAUER-DE WET
Dec. 31, 2014 Dec. 31, 2015
162,198
4,339
8,431
2,615
1,715
Current assets
317,141
314,883
26,326
31,267
1,776
404
Non-current debt
198,527
187,219
0
136
165
169
Current debt
133,321
140,098
6,827
10,031
4,130
3,904
BALANCE SHEET
in EUR ’000
Non-current assets
Current assets
Non-current debt
Current debt
BAUER Casings
PRAKLA Bohrtechnik
Site Group
Dec. 31, 2014 Dec. 31, 2015
Dec. 31, 2014 Dec. 31, 2015
Dec. 31, 2014 Dec. 31, 2015
579
578
4,511
3,565
38,003
21,502
3,052
3,078
15,986
8,779
50,833
73,318
4
59
260
282
0
0
649
401
19,940
16,757
90,767
96,225
2015
Group company
Dec. 31, 2015
Dec. 31, 2014
in EUR ’000
These are the material non-controlling interests of BAUER Group:
132
INCOME STATEMENT
in EUR ’000
Sales revenues
2014
2015
357,925
383,484
BAUER EGYPT S.A.E.
BAUER-DE WET
2014
2015
2014
2015
22,758
37,182
2,261
1,645
Operating result
23,788
38,655
3,064
7,291
-890
-1,724
Profit before tax
14,188
17,372
3,559
8,075
-1,155
1,740
10,464
12,152
2,122
5,841
-1,001
-2,231
122
122
939
2,564
-490
-1,093
10,342
12,031
1,183
3,256
-510
-1,138
-50
-40
-227
-446
0
0
Profit/loss attributable to non-controlling interests
Profit/loss attributable to shareholders of BAUER AG
Dividends distributed to non-controlling interest
INCOME STATEMENT
BAUER Casings
PRAKLA Bohrtechnik
in EUR ’000
2014
2015
2014
Sales revenues
3,687
4,264
11,696
2015
Site Group
2014
2015
6,990
11,224
10,377
Operating result
575
949
-1,872
-3,688
5,027
-9,162
Profit before tax
575
950
-2,537
-4,394
503
-14,465
460
759
-2,623
-4,992
355
-14,664
Profit/loss attributable to non-controlling interests
184
303
-262
-499
104
-2,376
276
456
-2,361
-4,493
251
-12,288
-146
-87
0
0
0
0
Profit/loss attributable to shareholders of BAUER AG
Dividends distributed to non-controlling interest
CASH FLOW STATEMENT
BAUER EGYPT S.A.E.
BAUER-DE WET
2014
2015
2014
2015
2014
Cash flow from operating activities
15,001
33,260
4,636
3,108
1,573
107
Cash flow from investing activities
-16,205
-7,944
-2,929
-7,429
-17
-70
Cash flow from financing activities
-1,631
-26,002
-19
-194
-1,537
-105
0
0
1,117
387
2
-4
-2.835
-686
2,805
-4,128
21
-72
in EUR ’000
Changes in cash and cash equivalents with an effect
on liquidity
CASH FLOW STATEMENT
in EUR ’000
BAUER Casings
2014
2015
PRAKLA Bohrtechnik
2015
Site Group
2014
2015
2014
2015
Cash flow from operating activities
537
394
7,870
-4,262
11,519
-25,176
Cash flow from investing activities
-74
-155
-535
-565
-4,191
42,164
Cash flow from financing activities
-375
-343
-7,533
4,819
-7,791
-16,170
12
-27
0
0
516
42
100
-131
-198
-8
53
860
Changes in cash and cash equivalents with an effect
on liquidity
133
b) Changes in shareholdings in the Group's subsidiaries
In financial year 2015, BAUER Maschinen GmbH acquired the remaining 10 % of the shares in MAT Mischanlagentechnik GmbH
at a purchase price of EUR 110 thousand. The share thus increased to 100 %.
Shares with a value of EUR -318 thousand (share in the carrying amount of the net assets of MAT Mischanlagentechnik GmbH)
The transferred shares were recognized in revenue reserves.
After the transfer of the shares, MAT Mischanlagentechnik GmbH, the transferor entity, was merged with
BAUER Maschinen GmbH and thus discontinued. The company Immenstadt is continued under the name of
MAT Mischanlagentechnik, a branch office of BAUER Maschinen GmbH.
In financial year 2015, BAUER Resources GmbH acquired the remaining 10 % of the shares in Esau & Hueber GmbH
at a purchase price of EUR 500 thousand. The share thus increased to 100 %.
Shares with a value of EUR -119 thousand (share in the carrying amount of the net assets of Esau & Hueber GmbH)
were transferred to BAUER Resources GmbH in the process.
The transferred shares were recognized in revenue reserves.
26.2 Additional disclosures regarding capital management
The object of Bauer's capital management is to safeguard a strong financial profile. In particular, it aims to provide
shareholders with appropriate dividend payments and to safeguard servicing of capital on behalf of lenders. We also aim to
provide ourselves with adequate financial resources to sustain our growth strategy. The risk profile is actively managed and
monitored. This is focused primarily on key indicators such as the equity ratio, net debt and net profit or loss for the period.
The key indicators are presented below:
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
Equity
418,925
451,210
Equity ratio
26.60 %
27.23 %
15,726
28,992
645,679
664,988
687,514
712,394
41,835
47,406
Net debt / EBITDA
3.78
3.59
EBITDA / net interest coverage
4.49
4.99
Net debt
Financial indebtedness
Liquid funds
2015
were transferred to BAUER Maschinen GmbH in the process.
134
As part of the capital management strategy covering the subsidiaries of the BAUER Group, it is ensured that member companies
are provided with an equity base in line with local requirements. Our aim in doing this is to provide the necessary flexibility in terms
of finance and liquidity. In the year under review all externally imposed capital covenants were fulfilled.
NON-CURRENT DEBT
27. NON-CURRENT LIABILITIES
The non-current portions of the liabilities comprise the following:
in EUR ’000
Remaining term Dec. 31, 2014
1 to 5 years
Total
in EUR ’000
Total
over 5 years
Remaining term Dec. 31, 2015
1 to 5 years
over 5 years
357,678
7,093
363,166
13,462
13,032
0
12,652
0
5,959
0
7,262
0
10,013
0
4,414
0
386,682
7,093
387,494
13,462
Fair value
Interest rate margin
Dec. 31, 2014
Dec. 31, 2015
Dec. 31, 2014
Dec. 31, 2015
378,016
384,999
0.50 - 11.2 %
0.50 - 11.2 %
13,032
12,652
2.38 - 7.89 %
1.43 - 7.50 %
9,904
4,409
0.85 - 12.5 %
3.5 - 12.5 %
400,952
402,060
-
-
The other non-current liabilities include non-current portions of liabilities from obligations in respect of part-time retirement and
service anniversary payments, trade payables, and liabilities from continuing involvements.
The other non-current financial liabilities mainly comprise the fair values of the derivatives as well as other liabilities to finance
companies and convertible bonds (see the Notes to the financial instruments in section 36).
28. PROVISIONS FOR PENSIONS
The BAUER Group operates a number of defined benefit plans in Germany and internationally. The provisions for defined
benefit plans of the companies in Schrobenhausen recognized on the consolidated balance sheet cover most (96 %) of the
balance sheet value. Those companies are governed by the occupational pension scheme of Bauer Spezialtiefbau GmbH
constituted on July 1, 1992 as amended by the in-company agreement dated November 18, 1998. In it, the company grants
all employees who joined by March 31, 1998 and their surviving dependents a retirement pension and invalidity benefit as well
as a widow's/widower's pension Employees qualify for the retirement pension on reaching the standard retirement age,
or on prior qualification for a pension from the statutory pension fund. The pension payable amounts to 0.225 percent of
the employee's pensionable earnings for each pensionable year of service, plus 0.075 percent of pensionable earnings for
each pensionable year of service completed before January 1, 1999; plus, for the portion of pensionable earnings above
the contribution assessment limit in the statutory pension fund, 0.375 percent plus 0.125 percent for each pensionable year
of service completed before January 1, 1999. In the case of scheme members who are not members of the Zusatzversorgungskasse des Baugewerbes (construction industry ancillary benefits fund): For each pensionable year of service, 0.3 percent of
135
the employee's pensionable earnings plus 0.1 percent of pensionable earnings for each pensionable year of service completed
before January 1, 1999; plus, for the portion of pensionable earnings above the contribution assessment limit in the statutory
pension fund, 0.3 percent plus 0.1 percent for each year of service completed before January 1, 1999.
dependent children in various forms.
Vesting and transitional arrangements are also in place.
The risks entailed by the pension schemes are mainly those commonly associated with defined benefit plans in terms of potential
variations in the discount interest rate and, to a lesser extent, inflation trends as well as longevity.
The calculations are based on the following actuarial assumptions:
Dec. 31, 2014
in %
Germany
Indonesia
Philippines
Taiwan
Interest rate
2.00
8.00
7.80
2.00
Future salary increases
3.00
10.00
3.00
3.00
Future pension increases
2.00
-
-
-
Germany
Indonesia
Philippines
Taiwan
Interest rate
2.35
6.00
5.03
1.63
3.00
10.00
5.00
3.00
Future pension increases
2.00
-
-
-
Defined benefit plans in Germany are calculated biometrically applying the 2005 G Graduated Life Tables compiled by Professor
Dr. Heubeck. The interest rate applied for discounting the future payment obligations is always determined on the basis of the
return on top company bonds.
Outside of Germany, the underlying biometric probability of death is based on published national statistics and empirical data.
The provision for pensions and similar obligations recognized in the balance sheet is calculated as follows:
Present value of commitments financed by a fund
Fair value of plan assets
Plan deficit
Dec. 31, 2014
Dec. 31, 2015
3,801
3,930
-657
-751
3,144
3,179
Present value of commitments not financed by a fund
115,360
111,346
Total deficit of define benefit plan commitments
118,504
114,525
-
-
118,504
114,525
Effect of asset ceiling
Recognized provision
2015
Dec. 31, 2015
in %
in EUR ’000
The widow's/widower's pension amounts to 50 percent of the attained entitlement. Benefits are also promised to surviving
136
The defined benefit obligation and the plan assets developed as follows in the previous year:
in EUR ’000
Date: Jan 1, 2013
Present value
of commitment
Fair value
of plan assets
Effect of
asset ceiling
Total
Total
84,109
-504
83,605
-
83,605
Current service costs
1,817
-
1,817
-
1,817
Interest expense/income
3,080
-32
3,048
-
3,048
-
-
-
-
-
89,006
-536
88,470
-
88,470
Income from plan assets excluding amounts
contained in the above interest
-
18
18
-
18
Actuarial gains and losses arising from adjustments
to demographic assumptions
-
-
-
-
-
to financial assumptions
32,274
-
32,274
-
32,274
-6
-
-6
-
-6
-
-
-
-
-
32,268
18
32,286
-
32,286
140
-52
88
-
88
Employer
-
-89
-89
-
-89
Beneficiary employee
-
-
-
-
-
-
2
2
-
2
-2,253
-
-2,253
-
-2,253
Post-employment expenditure, gains and losses
from payment in lieu
Total
Revaluation:
Empirical value-based adjustments
Changes in the effect of limitation of a defined
benefit plan on the asset ceiling, excluding amounts
contained in the interest
Total
Exchange rate movements
Contributions:
Payments from the plan:
Ongoing payments
Benefits (not fund-financed)
Other effects
Date: Dec. 31, 2014
-
-
-
-
-
119,161
-657
118,504
-
118,504
137
The defined benefit obligation and the plan assets developed as follows during the financial year:
Fair value
of plan assets
Effect of
asset ceiling
Total
Total
119,161
-657
118,504
-
118,504
Current service costs
2,838
-
2,838
-
2,838
Interest expense/income
2,429
-37
2,392
-
2,392
Post-employment expenditure, gains and losses
from payment in lieu
-
-
-
-
-
124,428
-694
123,734
-
123,734
Income from plan assets excluding amounts
contained in the above interest
-
39
39
-
39
to demographic assumptions
-
-
-
-
-
to financial assumptions
-8,267
-
-8,267
-
-8,267
1,686
-
1,686
-
1,686
Total
Revaluation:
Empirical value-based adjustments
Changes in the effect of limitation of a defined
benefit plan on the asset ceiling, excluding amounts
contained in the interest
-
-
-
-
-
-6,581
39
-6,542
-
-6.542
30
-6
24
-
24
Employer
-
-90
-90
-
-90
Beneficiary employee
-
-
-
-
-
-
-
-
-
-
-2,292
-
-2,292
-
-2,292
Total
Exchange rate movements
Contributions:
Payments from the plan:
Ongoing payments
Benefits (not fund-financed)
Other effects
Date: Dec. 31, 2015
-309
-
-309
-
-309
115,276
-751
114,525
-
114,525
Date: Jan 1, 2015
Present value
of commitment
2015
in EUR ’000
138
The fair value of the plan assets can be allocated to the following categories:
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
Qualifying insurance contracts
235
246
Money market fund and pension fund
390
466
32
39
657
751
Total
No market price quotations exist for the qualifying insurance contracts.
The key actuarial assumptions applied in determining the defined benefit plan commitment are the discount interest rate, expected
salary increases and expected pension increases.
The sensitivity of the overall pension commitment to variations in the weighted primary assumptions is:
Effect on commitment
in EUR ’000
Variation in
assumption
Increase in
assumption
Discount interest rate
+/- 0.5 %
104,490
126,490
+/- 0.5 %
118,051
111,604
Future pension increase
+/- 0.5 %
122,031
107,170
Increase
in assumption
by 1 year
Decrease
in assumption
by 1 year
120,424
110,018
Probability of death
Decrease in
assumption
The above sensitivity analysis is based on a variation in one assumption while all other assumptions remain constant.
It is unlikely that this will occur in reality, and variations in some assumptions may correlate. In calculating the sensitivity of the
defined benefit plan commitment to variations in actuarial assumptions, the same method was applied as that used to measure
the provisions for defined benefit plans on the balance sheet. The present value of the defined benefit plan commitments was
calculated by the Projected Unit Credit method as at the end of the reporting period.
The methods and categories of assumption applied in preparing the sensitivity analysis have not changed relative to the prior
period except for the probability of death.
139
The defined benefit plan commitments and plan assets by country are as follows:
Dec. 31, 2014
Germany
Present value of commitments
Total
Total
Indonesia
Total
Total
138
Total
-235
-390
0
-32
-657
117,538
637
223
106
118,504
119,161
-
-
-
-
-
117,538
637
223
106
118,504
Dec. 31, 2015
Germany
223
Taiwan
1,027
in EUR ’000
Present value of commitments
Philippines
117,773
Indonesia
Philippines
Taiwan
Total
113,724
1,079
269
204
115,276
-246
-466
0
-39
-751
113,478
-613
269
165
114,525
-
-
-
-
-
113,478
-613
269
165
114,525
in EUR ’000
Active scheme members
Deferred beneficiaries
Retired employees
Total
2015
The present value of the defined benefit plan commitment is distributed as follows among the plan members:
Dec. 31, 2014
Dec. 31, 2015
75,169
71,423
6,522
6,365
37,470
37,488
119,161
115,276
The weighted average term of the defined benefit plans is 19.44 years.
Pension payment in financial year 2016 are expected to amount to EUR 2,518 thousand (previous year: EUR 2,314 thousand).
Of that total, EUR 2,518 thousand (previous year: EUR 2,314 thousand) is projected to be contributed by the employer.
Contributions to the external plan assets totaling EUR 90 thousand (previous year: EUR 89 thousand) are expected for 2016.
The following table provides an overview of the due dates of the undiscounted pension payments:
in EUR ’000
Pension payments
under
1 year
2,518
in EUR ’000
1 to 5 years
6 to 10 years
Dec. 31, 2015
Total
12,189
20,536
35,243
140
CURRENT DEBT
29. CURRENT LIABILITIES
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
266,533
297,677
7,453
8,945
Advances received for orders
19,579
10,392
48,471
49,882
168,974
184,991
Trade payables
Liabilities to enterprises in which the company has participating interests
Total
205
1,017
68,632
71,503
25,712
12,078
605,559
636,485
The “Trade payables” balance sheet item includes long-term payables totalling EUR 791 thousand (previous year: EUR 979
thousand).
The other current liabilities mainly comprise obligations in respect of outstanding invoices, flexitime and holiday credits,
employer's liability insurance associations, the compensation levy for the shortfall in handicapped employees, performance
bonuses as well as other tax liabilities and liabilities in respect of social security.
The other current financial liabilities mainly comprise obligations to leasing and finance companies. The fair values virtually
match the carrying amounts. The interest rate margin on current liabilities to banks is 0.5 to 11.20 percent (previous year:
0.75 to 11.20 percent).
30. OTHER PROVISIONS
The other provisions have developed as follows in the financial year:
in EUR ’000
Date: Jan. 1
Currency adjustment
Dec. 31, 2014
Dec. 31, 2015
14,809
15,880
0
0
153
185
Allocation
6,633
5,114
Reversal
3,432
3,127
Consumption
2,283
1,939
Date: Dec. 31
15,880
16,113
Dec. 31, 2014
Dec. 31, 2015
14,670
14,763
The other provisions comprise the following:
in EUR ’000
Risk from contract processing and warranties
Litigation
Total
1,210
1,350
15,880
16,113
141
The provisions for risk from contract processing and warranties include all risks arising from carrying out specialist foundation
engineering work and from the sale of machinery, equipment and tools for specialist foundation engineering, with the associated
services. These primarily relate to warranty obligations and to other uncertain commitments. The risk from contract processing
be used up during 2016. The provisions for litigation in the amount of EUR 434 thousand (previous year: EUR 427 thousand)
are expected to be used during the course of 2017. The provisions for litigation relate for the most part to provisions for legal
disputes on supplementary receivables.
31. CONTINGENT LIABILITIES
Contingent liabilities are liabilities not yet recognized in the financial statements, which are recognized in the amount of the
maximum possible exposure on the balance sheet date.
in EUR ’000
Dec. 31, 2014
Liabilities from guarantees
5,112
Dec. 31, 2015
112,035
In the construction industry, it is common and essential practice to issue various guarantees to secure obligations arising
from construction contracts. These guarantees are usually issued by banks or credit insurance companies (guarantors), and
essentially guarantee quotations, contract performance, prepayments and warranty commitments. In the event of a guarantee
being given, the guarantors have a right of recourse against the Group. A risk of a guarantee being implemented exists only
when the underlying contractual obligations are not duly met.
The contingent liabilities were mainly in relation to the securing of contract performance, to warranty obligations and to advance
payments. Liabilities from guarantees exist to third parties. In addition, we are subject to joint and several liability in respect of all
joint ventures in which we participate.
The maturities of payments for liabilities were not stated for reasons of practicality.
32. OTHER FINANCIAL OBLIGATIONS
Remaining term
in EUR ’000
under 1 year
1 to 5 years
Dec. 31, 2014
over 5 years
Dec. 31, 2014
Dec. 31, 2015
Dec. 31, 2015
Dec. 31, 2014
Dec. 31, 2015
Minimum lease payments
from operating leases
9,663
9,784
22,048
12,636
77
303
Other financial obligations
6,715
13,385
3,677
7,225
6,749
6,435
The operating leases relate mainly to mutual agreements about factory and office equipment, as well as to technical equipment
and machinery which were added in the financial year and are classified as operating leases. The BAUER Group is committed
to rental agreements of unlimited term totaling monthly EUR 1,342 thousand (previous year: EUR 685 thousand). The other
financial obligations mainly include limited-term property rentals and leases.
33. DISCONTINUED OPERATIONS
There are no plans to discontinue business operations under the terms of IFRS 5.
34. EVENTS AFTER THE BALANCE SHEET DATE
No events subject to mandatory reporting in accordance with IAS 10 occurred after December 31, 2015.
2015
The provisions for risks arising from contract processing and warranties and material provisions for litigation are predicted to
and warranties is determined specific to project/construction site.
142
OTHER DISCLOSURES
35. CASH FLOW STATEMENT
The funds shown in the cash flow statement comprise only the cash and cash equivalents stated on the balance sheet.
The cash flow statement details payment flows, broken down by inflow and outflow of funds from operating activities and
from investing and financing activities.
The cash flow from operating activities is derived indirectly from the pre-tax profit. The pre-tax profit is adjusted by non-cash
transactions. The cash flow from operating activities is produced taking account of the changes in working capital.
Investing activities include additions to property, plant and equipment and to financial assets and intangible assets, as well
as income from the sale of assets. Financing activities include outflows of cash and cash equivalents arising from dividend
payments as well as the change in other financial indebtedness.
The changes in balance sheet items applied for the preparation of the cash flow statement are not directly derivable from
the balance sheet, as the effects of currency translation and changes in the scope of consolidation, as well as the allocation
and elimination of value adjustments on trade receivables, do not affect payments and are stripped out.
36. FINANCIAL INSTRUMENTS
In its business operations and financing activities the BAUER Group is subject in particular to fluctuations in exchange rates
and interest rates. It is the company's policy to exclude, or at least limit, these risks by entering into hedge transactions.
All hedging measures are controlled and executed centrally by BAUER AG.
Application of the segregation-of-duties approach ensures that there is an adequate split between the trading and execution
functions. The segregation-of-duties approach is implemented by spreading functions across the Management Board (financial
reporting) and the corporate departments (operational handling). All derivatives transactions are entered into only with banks
of the highest possible credit rating.
MARKET RISKS
Foreign exchange rate risks
Foreign exchange rate risks under the terms of IFRS 7 are created by financial instruments which are denominated in a currency
different to the functional currency and are of a monetary nature. Exchange rate-related differences when converting financial
statements into the Group currency are ignored. All non-functional currencies in which the BAUER Group enters into financial
instruments are classed, as a matter of principle, as relevant risk variables.
The existing foreign exchange forward contracts and cross-currency swaps safeguard our currency hedging strategy.
Within the BAUER Group, the primary monetary financial instruments are either denominated directly in functional currency
or are largely transferred into the functional currency by means of derivatives. In view of the usually short-term maturity of the
instruments too, possible changes in exchange rates have only very minor effects on earnings or equity.
For the purposes of sensitivity analysis, foreign exchange rate risks arising from monetary financial instruments which were not
concluded in the functional currencies of the individual member companies of the BAUER Group are included in the analysis.
143
Quantification of foreign exchange risk in case of exchange rate shifts of +/- 10 %:
USD
RUB
CAD
Overall effect of +10 % on OCI
10,653
137
0
Overall effect of -10 % on OCI
-13,021
-167
0
Overall effect of +10 % on income statement
8,055
64
-99
Overall effect of -10 % on income statement
-6,181
-78
122
in EUR '000
on Dec. 31, 2015
USD
RUB
CAD
Overall effect of +10 % on OCI
12,375
186
Overall effect of -10 % on OCI
0
-15,123
-227
0
Overall effect of +10 % on income statement
2,632
0
-88
Overall effect of -10 % on income statement
-3,373
0
107
The sensitivity effects in 2015 primarily related to the US dollar, Russian ruble and Canadian dollar. No concentrations of risk exist.
Interest rate risks
The existing interest rate swaps serve to safeguard our financing and interest rate hedging strategy. Agreements exist in
respect of swaps from variable to fixed interest rates in order to exclude the risk of fluctuation in market interest rates.
Changes in market interest rates affect the interest results of variable-rate primary financial instruments of which the interest
payments are not hedged by derivatives, and consequently are included in the calculation of earnings-related sensitivity.
Changes in market interest rates of interest rate derivatives (interest rate swaps, interest rate/currency swaps) which are not
embedded in a hedging relationship pursuant to IAS 39 have effects on financial income and expenses (net valuation based
on adjustment of financial assets to applicable fair value) and so are included in the calculation of earnings-related sensitivity.
The effects of changes in market interest rates of interest rate derivatives to which hedge accounting is applied are recognized
in the OCI.
Quantification of risk of change in interest rate in case of interest rate shifts of +/- 100 base points:
in EUR ’000
Dec. 31, 2014
Dec. 31, 2015
Overall effect of +100 base points on OCI
732
558
Overall effect of -100 base points on OCI
-393
-162
Overall effect of +100 base points on income statement
-1,672
-82
Overall effect of -100 base points on income statement
2,278
-114
Raw material risks
Raw material risks to which the BAUER Group is exposed in respect of availability and potential fluctuations in price on the
market are excluded, or limited, by means of supply promises and fixed pricing agreements entered into with suppliers prior to
execution of contracts. The raw material risk relates mainly to steel.
on Dec. 31, 2014
2015
in EUR '000
144
Liquidity risks
The liquidity risk is managed by means of business planning, which ensures that the necessary funds to finance operating
activities and current and future capital investments are made available at the appropriate time, in the required currency, and at
optimum cost, in all Group companies. In liquidity risk management, the liquidity requirement arising from operating activities,
from investment activities and from other financial measures is determined in the form of a banking report and a liquidity plan.
Liquidity is guaranteed at all times by means of a liquidity forecast focused on a fixed planning horizon and by unused lines of
credit and guarantee facilities.
The following tables present the contractually agreed and undiscounted interest payments and capital repayments in respect of
primary financial liabilities of the BAUER Group:
in EUR ’000
Carrying amount
Dec. 31, 2014
Cash flow
2015
Cash flow
2016 to 2019
Cash flow
2020 et seqq.
631,304
276,146
393,705
10,816
20,485
8,201
13,712
20
Other liabilities
74,591
68,632
2,898
3,062
Other financial liabilities (excluding derivatives)
17,623
11,981
5,997
0
Trade payables
in EUR ’000
48,471
48,471
0
0
168,974
167,995
979
0
205
205
0
0
Carrying amount
Dec. 31, 2015
Cash flow
2016
Cash flow
2017 to 2020
674,305
314,778
380,250
Cash flow
2021 et seqq.
14,641
21,597
9,570
13,165
0
Other liabilities
78,765
71,503
4,295
2,967
Other financial liabilities (excluding derivatives)
Trade payables
9,689
9,200
528
0
49,882
49,882
0
0
184,991
184,200
791
0
1,017
1,017
0
0
There were no instances of defaulting on interest payments or capital repayments in the period under review. Furthermore, all
externally imposed capital covenants were fulfilled, see also page 133 “Additional disclosures regarding capital management”.
No concentrations of risk exist. It is not to be expected that liabilities arising from sureties (contingent liabilities) will result in
significant actual liabilities, and thus in significant cash flows, for which no provisions have yet been made.
145
The due dates of derivative financial instruments based on outflow and inflow of cash and cash equivalents are as follows:
Liabilities from foreign exchange forward contracts
Outflow of cash and cash equivalents
Inflow of cash and cash equivalents
Carrying amount
2015
2016 to 2019
as from 2020
12,926
-12,804
-279
0
-
-228,410
-8,220
0
-
215,606
7,941
0
5,176
-2,598
-2,341
-29
-
-2,598
-2,341
-29
-
0
0
0
Liabilities from interest rate swaps
in EUR '000
2016
2017 to 2020
3,375
-2,654
-2,188
0
-
-74,496
-37,330
0
-
71,842
35,142
0
on Dec. 31, 2015
Liabilities from foreign exchange forward contracts
Liabilities from interest rate swaps
Carrying amount
as from 2021
3,428
-1,714
-2,766
-1,505
-
-1,714
-2,766
-1,505
-
0
0
0
To calculate the cash inflows from interest rate swaps the conditions as per December 31, 2015 were applied.
Risk of default
The risk of default is managed at Group level. Default risks arise from cash and cash equivalents, derivative financial instruments and deposits at banks and financial service companies. Only banks and financial services companies with the highest
possible credit ratings are selected as partners. No credit limit was exceeded in the reporting period. The management expects
no defaults on the part of these business partners.
The risk of default on financial assets exists in terms of the risk of failure of a contract party and thus to a maximum in the
amount of the carrying amount of the exposure to the said party. A presentation of the carrying amounts and the resultant
maximum risk of default per category is given in the table starting on page 150. The risk arising from primary financial instruments
is countered by means of value adjustments for bad debt, and in Germany also by means of credit insurance cover. As derivative
financial instruments are entered into only with banks with the highest possible credit ratings, and the risk management system
sets limits for each party, the actual risk of default is negligible. No concentrations of risk exist.
on Dec. 31, 2014
2015
in EUR '000
146
Other disclosures relating to financial instruments
The Group has taken up loans with variable interest rates and hedged against its interest rate-related cash flow risk by means
of swaps. Such interest rate swaps have the commercial effect of converting variable-interest loans into fixed-interest loans.
In these interest rate swaps, the Group agrees with other parties to swap the difference between the fixed and variable interest
rates derived from the agreed nominal amounts at regular intervals.
The nominal volumes and market values of the derivative financial instruments are as follows:
in EUR ’000
Nominal volume
Dec. 31, 2014
Fair value
Dec. 31, 2015
Dec. 31, 2014
Positive
Dec. 31, 2015
Negative
Positive
Negative
Interest rate swaps
of which in hedge accounting
64,571
27,214
0
-1,354
0
-336
of which not in hedge accounting
67,350
102,150
0
-3,822
0
-3,092
119,546
144,156
988
-7,640
2,643
-1,633
145,022
70,848
426
-5,286
809
-1,742
Foreign exchange forward contracts
Cross currency swaps
1,419
0
69
0
0
0
2,578
1,841
60
0
108
0
Net result by valuation category
The following table sets out the net profits and losses (before tax) on financial instruments stated in the income statement, broken
down by valuation category as per IAS 39:
in EUR ’000
Loans and receivables
Financial liabilities measured at amortized cost
Available-for-sale financial assets
Held for trading
Total
Dec. 31, 2014
Dec. 31, 2015
982
-9,986
-39,075
-35,618
-705
-162
-7,875
-8,984
-46,673
-54,750
The net result of the “Loans and Receivables” category includes results from the creation and reversal of value adjustments
in respect of trade receivables, results from bank fees, impairments of uncollected receivables as well as interest income.
The net result of the “Financial Liabilities Measured at Amortized Cost” category includes the result from interest expenditure
to third parties, for current and non-current loans as well as guaranty commissions.
Net available for sale financial assets contain amortization on financial assets. Equity shares in companies are valued at cost and
are not included.
The net result of the “Financial Assets and Liabilities Held for Trading” category includes results from foreign exchange forward
contracts and options, as well as results from changes to the fair values of interest rate swaps.
147
Carrying amounts and fair values
The fair value of a financial instrument is the consideration for which an asset might be exchanged, or a debt paid, between
informed, willing and mutually independent parties. Where financial instruments are quoted on an active market – such as
in particular shares held and bonds issued – the price quoted on the market in question is the fair value. If no active market
The fair values of foreign exchange forward contracts and cross-currency swaps are measured separately at their respective
forward prices and discounted to the reference date based on the corresponding interest rate curve. The market prices of
foreign exchange forward options are determined by recognized option models.
The fair values of the interest swaps correspond to the respective market value as determined by appropriate financial valuation
methods, such as by discounting expected future cash flows.
For cash and cash equivalents, current trade receivables and other current assets, current trade payables and other current
liabilities, owing to their short remaining terms the carrying amount should be adopted as a realistic estimate of the fair value.
The fair values of non-current financial assets and of other non-current financial liabilities correspond to the cash values of the
payment flows linked to the assets, taking into account the applicable interest rate parameters, which reflect changes in the
terms and expectations of the market and of the respective parties.
The fair values of financial instruments are determined on the basis of one of the methods set out on the three following levels:
• Level 1: Quoted prices (adopted unchanged) on active markets for identical assets and liabilities
• Level 2: Directly or indirectly observable input data for the asset or liability other than quoted prices as per level 1
• Level 3: Applied input data which does not originate from observable market data for measurement of the asset and liability
(non-observable input data)
There were no transfers between the levels during the year. If circumstances arise necessitating a reclassification, it is undertaken
at the end of the reporting period.
Other disclosures relating to hedging transactions
In financial year 2015, changes in equity due to cash flow hedges in the amount of EUR 190 thousand (previous year:
EUR 1,174 thousand) before taxes and in the amount of EUR 137 thousand (previous year: EUR 1,120 thousand) after taxes
were recognized as hedge reserve in equity without any effect on profit and loss. An amount of EUR 834 thousand (previous
year: EUR -6,497 thousand) was recognized in profit and loss from the hedge reserve created with no effect on net income
in the shareholders' equity. Fair value changes resulting from the derivative financial instruments held on December 31, 2015
were recognized in equity (increase) in the amount of EUR 1,024 thousand (previous year: EUR -5,313 thousand). In addition,
the changes in deferred taxes in the amount of EUR -53 thousand (previous year: EUR 54 thousand) were recognized in equity without any effect on profit and loss. Future transactions in foreign currencies secured by hedging and changes in market
interest rates are expected to be realized by 2020 at the latest. Gains and losses on future contracts in foreign currency and
2015
prices quoted on an active market.
exists, the fair value is determined by financial valuation methods. For securities (AfS) the BAUER Group has at its disposal the
148
interest rates at December 31, 2015 included in the hedge reserve in the OCI are recognized in the income statement in the
period in which the hedged planned transaction impacts on the income statement.
The prospective effectiveness is measured according to the Critical Term Match method and the retrospective effectiveness
according to the Dollar Offset method based on the Hypothetical Derivatives method.
Offsetting financial assets and financial liabilities
a) Financial assets
The following financial assets are subject to offsetting, enforceable master-netting arrangements or similar arrangements.
Related amounts,
which are not offset in the balance sheet
in EUR ’000
Gross financial
assets recognized
Gross financial
liabilities offset on
the balance sheet
Net amount of
financial assets
recognized on the
balance sheet
Financial
instruments
Cash securities
received
Net amount
Date: Dec. 31, 2014
Derivative financial assets
1,543
0
1,543
-1,484
-
59
41,835
0
41,835
-4,402
-
37,433
Total
43,378
0
43,378
-5,886
-
37,492
3,560
0
3,560
-1,662
-
1,898
47,406
0
47,406
-4,000
-
43,406
Total
50,966
0
50,966
-5,662
-
45,304
Date: Dec. 31, 2015
Derivative financial assets
149
b) Financial liabilities
The following financial liabilities are subject to offsetting, enforceable master-netting arrangements or similar arrangements.
Net financial
liabilities recognized on the balance sheet
Financial
instruments
Cash securities
paid
Net amount
Date: Dec. 31, 2014
Derivative financial liabilities
18,102
0
18,102
-1,484
-
16,618
Current-account overdrafts
188,709
0
188,709
-4,402
-
184,307
Total
206,811
0
206,811
-5,886
-
200,925
Derivative financial liabilities
6,803
0
6,803
-1,662
-
5,141
Current-account overdrafts
216,891
0
216,891
-4,000
-
Total
223,694
0
223,694
-5,662
Date: Dec. 31, 2015
212,891
218,032
The “Financial instruments” column lists the amounts which are subject to master-netting arrangements but are not netted
on the balance sheet because the preconditions for offsetting are not met. The “Cash securities received” column lists the
amounts of cash and financial instrument securities received relative to the sum total of assets and liabilities which do not
meet the criteria for netting on the balance sheet.
2015
Gross amount
of financial assets
Gross financial
offset on the
liabilities recognized
balance sheet
Related amounts,
which are not offset in the balance sheet
in EUR ’000
150
Within the Group, financial instruments are classified in the same way as the respective balance sheet items. No fair value
was stated for current financial instruments and financial instruments recognized at cost in accordance with IFRS 7.29.
The following table presents a progression of the classes to the categories of IAS 39 and the respective market values:
in EUR ’000
Measurement benchmark
Carrying amount
Loans and receivables/
other financial liabilities
Dec. 31, 2014 Dec. 31, 2015
Dec. 31, 2014 Dec. 31, 2015
NON-CURRENT ASSETS
Participations
3,613
3,613
28,420
15,355
0
0
1,402
707
0
0
22,671
11,408
22,671
11,408
4,347
3,240
0
0
Receivables from construction contracts
132,159
129,478
132,159
129,478
Trade receivables
311,417
343,933
311,417
343,933
67
3,272
67
3,272
20,100
28,901
141
2.853
0
0
19,959
26,048
19,959
26,048
41,835
47,406
41,835
47,406
537,611
571,958
528,108
561,545
CURRENT ASSETS
Receivables from enterprises
in which the company has participating interests
Other current financial assets
Total financial assets
Dec. 31, 2014 Dec. 31, 2015
Financial Assets and
Liabilities Held for Trading
Derivatives in Hedge
Accounting
Recognition in the
balance sheet in accordance
with IAS 17
Fair Value in accordance
with IFRS 7 and IFRS 13
Dec. 31, 2014 Dec. 31, 2015
Dec. 31, 2014 Dec. 31, 2015
Dec. 31, 2014 Dec. 31, 2015
Dec. 31, 2014 Dec. 31, 2015
n/a
Measurement level
in accordance with
IFRS 13
3,613
3,613
0
0
0
0
0
0
n/a
n/a
0
0
349
108
1,053
599
0
0
0
0
0
0
0
0
0
0
1,402
707
2
22,224
9,960
2
4,347
3,240
0
0
0
0
0
0
n/a
n/a
n/a
0
0
0
0
0
0
0
0
n/a
n/a
n/a
0
0
0
0
0
0
0
0
310,972
343,404
0
0
0
0
0
0
0
0
n/a
n/a
0
0
136
809
5
2,044
0
0
141
2,853
0
0
0
0
0
0
0
0
n/a
n/a
n/a
0
0
0
0
0
0
0
0
n/a
n/a
n/a
7,960
6,853
485
917
1,058
2,643
0
0
334,739
356,924
2
n/a
2
Available
for Sale
Not allocated to any IAS 39 category
2015
Balance sheet valuation as per IAS 39
151
152
in EUR ’000
Measurement benchmark
Carrying amount
Loans and receivables/
other financial liabilities
Dec. 31, 2014 Dec. 31, 2015
Dec. 31, 2014 Dec. 31, 2015
NON-CURRENT DEBT
364,771
376,628
364,771
376,628
13,032
12,652
0
0
10,013
4,414
4,371
3,925
0
0
5,642
489
5,642
489
266,533
297,677
266,533
297,677
7,453
8,945
0
0
48,471
49,882
48,471
49,882
168,974
184,991
168,974
184,991
205
1,017
205
1,017
25,712
12,078
13,731
2,878
0
0
11,981
9,200
11,981
9,200
905,164
948,284
866,577
919,884
CURRENT DEBT
Liabilities from construction contracts
Trade payables
Liabilities to enterprises
in which the company has participating interests
Total financial liabilities
Dec. 31, 2014 Dec. 31, 2015
Financial Assets and
Liabilities Held for Trading
Derivatives in Hedge
Accounting
Recognition in the
balance sheet in accordance
with IAS 17
Fair Value in accordance
with IFRS 7 and IFRS 13
Dec. 31, 2014 Dec. 31, 2015
Dec. 31, 2014 Dec. 31, 2015
Dec. 31, 2014 Dec. 31, 2015
Dec. 31, 2014 Dec. 31, 2015
Measurement level
in accordance with
IFRS 13
0
0
0
0
0
0
0
0
378,016
384,999
2
0
0
0
0
0
0
13,032
12,652
13,032
12,652
n/a
0
0
3,648
2,470
723
1,455
0
0
4,371
3,925
2
0
0
0
0
0
0
0
0
5,533
484
2
0
0
0
0
0
0
0
0
n/a
n/a
n/a
0
0
0
0
0
0
7,453
8,945
7,453
8,945
n/a
0
0
0
0
0
0
0
0
n/a
n/a
n/a
0
0
0
0
0
0
0
0
n/a
n/a
n/a
0
0
0
0
0
0
0
0
n/a
n/a
n/a
0
0
5,460
2,364
8,271
514
0
0
13,731
2,878
0
0
0
0
0
0
0
0
n/a
n/a
0
0
9,108
4,834
8,994
1,969
20,485
21,597
422,136
413,883
2
n/a
Available
for Sale
Not allocated to any IAS 39 category
2015
Balance sheet valuation as per IAS 39
153
154
37. EXECUTIVE BODIES
In the year under review the Supervisory Board comprised the following members:
Chairman
• Dr. Klaus Reinhardt, General a. D., Starnberg
Deputy Chairman
• Robert Feiger, Neusäss
Chairman of the Federal Executive Committee of the IG Bauen-Agrar-Umwelt trade union, Frankfurt am Main
Supervisory Board, Zusatzversorgungskasse des Baugewerbes AG, Wiesbaden, member
Supervisory Board Zusatzversorgungskasse Gerüstbaugewerbe VVaG, Wiesbaden, Chairman (until June 30, 2015)
• Dr.-Ing. Johannes Bauer, Schrobenhausen
Construction engineer with BAUER Designware GmbH, Schrobenhausen
• Dipl.-Ing. (FH) Rainer Schuster, Freising
Retired civil engineer
• Dipl.-Ing. (FH) Elisabeth Teschemacher, née Bauer, Schrobenhausen
1. Chair of the management board of Caritasverband Neuburg-Schrobenhausen e.V., Neuburg
• Gerardus N. G. Wirken, Breda, Netherlands
Freelance consultant on strategy, controlling and accounting
Supervisory Board Vendor Beheer B.V., Tilburg, Netherlands, Chairman (until September 1, 2015)
Supervisory Board Winters Bouw- en Ontwikkeling B.V., Breda, Netherlands, Chairman
• Prof. Dr.-Ing. E.h. Manfred Nußbaumer M.Sc, Munich
Retired civil engineer
Supervisory Board Leonhardt, Andrä und Partner Beratende Ingenieure VBI AG, Stuttgart, member
• Regina Andel, Ellrich
Chair of the Works Council, SCHACHTBAU NORDHAUSEN GmbH, Nordhausen
• Dipl.-Volkswirt Norbert Ewald, Bad Vilbel
Member of the Management Board, Zusatzversorgungskasse des Steinmetz- und Steinbildhauerhandwerks VVaG, Wiesbaden
• Reinhard Irrenhauser, Schrobenhausen
Supervisory Board BAUER Maschinen GmbH, Schrobenhausen,
Chairman of the Works Council, BAUER Maschinen GmbH, Schrobenhausen
• Dipl.-Kfm. (FH) Stefan Reindl, Schrobenhausen
Human Resources Director of BAUER Aktiengesellschaft, Schrobenhausen
Advisory Board, BAUER Training Center GmbH, Schrobenhausen, Chairman
• Dipl.-Ing. Gerold Schwab, Kernen
Construction Engineer in the Technical Division of BAUER Spezialtiefbau GmbH, Schrobenhausen
155
Management Board
• Prof. Dr.-Ing. E.h. Dipl.-Kfm. Thomas Bauer, Schrobenhausen, Chairman, Functions: Participations in Subsidiaries, Accounting,
Planning, Advertising, Controlling
Supervisory Board, BAUER Spezialtiefbau GmbH, Schrobenhausen, Chairman
Supervisory Board SCHACHTBAU NORDHAUSEN GmbH, Nordhausen, Chairman
Supervisory Board BAUER EGYPT S.A.E., Cairo, Chairman
• Dipl.-Betriebswirt (FH) Hartmut Beutler, Schrobenhausen, Functions: Finance, Legal Affairs and Insurance, Investor Relations,
Facility Management
Supervisory Board BAUER Resources GmbH, Schrobenhausen, Member
Supervisory Board Schrobenhausener Bank e.G., Schrobenhausen, Chairman
• Dipl.-Ing. Heinz Kaltenecker, Schrobenhausen, Functions: Participations in Subsidiaries, Information Technology,
Human Resources, Quality Management, Risk Management, Health Safety Environment
Supervisory Board, BAUER Spezialtiefbau GmbH, Schrobenhausen, Deputy Chairman
Supervisory Board, BAUER Maschinen GmbH, Schrobenhausen, Deputy Chairman
Supervisory Board, BAUER Resources GmbH, Schrobenhausen, Chairman
Supervisory Board, SCHACHTBAU NORDHAUSEN GmbH, Nordhausen, Deputy Chairman
The total remuneration paid to members of the Management Board in the year under review, excluding allocations to
pension provisions, was EUR 1,274 thousand (previous year: EUR 1,150 thousand). Of that total, EUR 1,124 thousand
(previous year: EUR 1,090 thousand) was not performance-related and EUR 150 thousand (previous year: EUR 60 thousand)
was performance-related. The total remuneration includes benefits in kind arising from the private use of a company car and
reimbursement of travel expenses for each member of the Management Board, as well as pro rata group accident insurance
premiums and employer’s liability insurance association contributions. The company pension scheme for Management Board
members incurred pension service costs totaling EUR 155 thousand (previous year: EUR 159 thousand). The pensionable
earnings serving as the basis for calculating pension levels are significantly lower than the basic salary in all contracts. Calculated
in accordance with IAS 19, the defined benefit obligation entailed by all pension commitments to members of the Management Board at the year-end was EUR 5,537 thousand (previous year: EUR 5,531 thousand). Former members of the management bodies of the parent company received total remuneration of EUR 0 thousand (previous year: 0) in return for duties
performed on behalf of the parent company.
2015
Supervisory Board BAUER Resources GmbH, Schrobenhausen, Deputy Chairman
Supervisory Board, BAUER Maschinen GmbH, Schrobenhausen, Chairman
156
The remuneration paid to the Supervisory Board for the 2015 financial year totaled EUR 254 thousand (previous year:
254 thousand) and was distributed as follows:
in EUR ’000
2014
2015
38
38
27
27
Dr.-Ing. Johannes Bauer
20
20
Dipl.-Ing. (FH) Rainer Schuster
18
18
Dipl.-Ing. (FH) Elisabeth Teschemacher
18
18
Gerardus N. G. Wirken
20
20
Prof. Dr. Manfred Nussbaumer
20
20
Dipl.-Volkswirt Norbert Ewald
20
20
Dipl.-Kfm. (FH) Stefan Reindl
18
18
Regina Andel
18
18
Dipl.-Ing. Gerold Schwab
20
20
Reinhard Irrenhauser
18
18
254
254
Chairman
Dr. Klaus Reinhardt
Deputy Chairman
Robert Feiger
Total *
* rounded
38. RELATED PARTY DISCLOSURES
Related parties under the terms of IAS 24 are parties that the reporting enterprise has the ability to control or exercise significant
influence over, or parties that have the ability to control or exercise significant influence over the reporting enterprise.
Transactions with related parties are defined as the transfer of resources, services or obligations between the reporting entity
and a related party, regardless of whether an invoice is issued in respect of the transaction or not.
Members of the Management Board of BAUER AG are members of Supervisory Boards and Management Boards of other
companies with which BAUER AG maintains relations in the course of its ordinary business operations. Members of the
Supervisory Board received pensions totaling EUR 55 thousand (previous year: EUR 55 thousand) in respect of former
employment within the BAUER Group. The members of the Supervisory Board, by virtue of their role as employees, received
remuneration totaling EUR 483 thousand (previous year: EUR 468 thousand). Lease and service contracts and contracts
of employment (except for the remuneration to members of the Management Board disclosed) exist with members of the
Management Board, including close family, in respect of which remuneration to an amount of EUR 1,032 thousand
(previous year: EUR 879 thousand) was paid.
157
Loan commitments to the BAUER Foundation existed totaling EUR 1,000 thousand (previous year: EUR 1,000 thousand), for
which interest amounting to EUR 55 thousand (previous year: 55 thousand) was paid.
At the end of the financial year no loan commitments existed to shareholders of BAUER AG.
in EUR ’000
Non-consolidated companies
Joint ventures
2015
2014
2015
2014
1,990
7,325
14,651
20,620
11,812
10,834
172
1,389
2,875
2,558
0
0
0
794
18,863
12,490
24,738
35,751
125
701
2,538
3,859
0
1,102
Impairment of receivables
0
0
891
1,927
16,790
22,887
Expenses for uncollectible
and doubtful debts
0
328
0
1,088
34
6,314
2014
Income
Purchased services
Receivables and other
assets (Dec. 31)
Liabilities (Dec. 31)
2015
The purchased services essentially comprise all expenses incurred with related parties during the financial year.
2015
Transactions with related parties are conducted at standard market terms.
The receivables and other assets include uncollectable receivables as well as financial assets in respect of related parties.
39. JOINT OPERATIONS
The material joint operations are listed below:
Company's activities
Headquarters
Shareholding
Bangaroo Project
Sydney, Australia
60 %
Sebuku Island
South Kalimantan, Indonesia
35 %
Deep-Bauer Foundation Inc.
Calgary, Canada
44 %
Company's activities
Headquarters
Shareholding
Bangaroo Project
Sydney, Australia
50 %
Deep-Bauer Foundation Inc.
Calgary, Canada
44 %
Project
Project
The key relationships between fully consolidated Group companies and related parties are set out in the following table:
158
40. FEES AND SERVICES OF THE AUDITORS
The fee paid to the auditors and recorded as expenditure in the financial year is broken down as follows:
PricewaterhouseCoopers AG:
in EUR ’000
Fees for auditing services
2014
2015
668
723
Fees for other certification
5
14
Fees for tax advice
21
75
Fees for other services
45
79
739
891
Total
In addition, Roland Jehle GmbH Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft was engaged to audit the major
German capital corporations included in the Group's consolidated financial statements.
The fees for this recognized in the financial year are broken down in accordance with Section 285, Paragraph 17 and Section 314,
Subsection 1, Paragraph 9 HGB as follows:
in EUR ’000
Auditing fees
2014
2015
37
39
Fees for other certification
0
2
Fees for tax advice
7
7
Fees for other services
Total
0
0
44
48
41. DECLARATION OF CONFORMITY TO THE GERMAN CORPORATE GOVERNANCE CODE
The management Board and Supervisory Board of BAUER AG issued the Declaration of conformity prescribed by Paragraph
161 AktG on December 8, 2015 and made it permanently available for the shareholders on the website www.bauer.de.
42. AVERAGE NUMBER OF EMPLOYEES
2014
2015
Salaried staff
3,948
4,050
Germany
1,984
2,001
International
1,964
2,049
Industrial & trades
6,209
6,443
Germany
1,926
1,920
International
4,283
4,523
248
245
10,405
10,738
Apprentices
Total number of employees
43. AUTHORIZATION FOR ISSUE OF THE CONSOLIDATED FINANCIAL STATEMENTS
The Management Board has submitted the consolidated financial statements to the Supervisory Board for authorization for issue
(the Supervisory Board meeting is scheduled for April 13, 2016).
159
44. PROPOSAL ON APPROPRIATION OF NET EARNINGS AVAILABLE FOR DISTRIBUTION
The Management Board and Supervisory Board of BAUER AG propose to resolve to distribute a dividend of EUR 0.15
per dividend-bearing share to the shareholders from unappropriated net profit in financial year 2015 in the amount of
EUR 5,615,809.55. At 17,131,000 dividend-bearing no-nominal-value shares, this corresponds to a dividend of EUR
forward to new account.
The Management Board
Prof. Thomas Bauer
2015
forward to new account. Any partial amount relating to non-dividend-bearing no-nominal-value shares will also be carried
2,569,650. The boards further propose to carry the remaining unappropriated net profit in the amount of EUR 3,046,159.55
160
Major participations of the
BAUER Group at december 31, 2015
NAME AND REGISTERED OFFICE OF COMPANY
1.
B.
Capital share
in %
Fully consolidated companies
A.
Currency
EUR
Germany
BAUER Spezialtiefbau GmbH, Schrobenhausen, Deutschland
EUR
99.00
BAUER Maschinen GmbH, Schrobenhausen, Deutschland
EUR
99.00
SCHACHTBAU NORDHAUSEN GmbH, Nordhausen, Germany
EUR
99.00
SPESA Spezialbau und Sanierung GmbH, Schrobenhausen, Germany
EUR
99.00
BAUER Resources GmbH, Schrobenhausen, Germany
EUR
99.00
BAUER Training Center GmbH, Schrobenhausen, Germany
EUR
100.00
BAUER Designware GmbH, Schrobenhausen, Germany
EUR
100.00
BAUER Umwelt GmbH, Schrobenhausen, Germany
EUR
100.00
KLEMM Bohrtechnik GmbH, Drolshagen, Germany
EUR
100.00
EURODRILL GmbH, Drolshagen, Germany
EUR
100.00
WW Beteiligung GmbH, Schrobenhausen, Germany
EUR
100.00
RTG Rammtechnik GmbH, Schrobenhausen, Germany
EUR
100.00
PRAKLA Bohrtechnik GmbH, Peine, Germany
EUR
90.00
Olbersdorfer Guß GmbH, Olbersdorf, Germany
EUR
75.00
Schachtbau Nordhausen Bau GmbH, Nordhausen, Germany
EUR
100.00
SCHACHTBAU NORDHAUSEN Stahlbau GmbH, Nordhausen, Germany
EUR
100.00
MMG Mitteldeutsche MONTAN GmbH, Nordhausen, Germany
EUR
100.00
HGC Hydro-Geo-Consult GmbH, Freiberg, Germany
EUR
100.00
BAUER Water GmbH, Dunningen, Germany
EUR
100.00
PURE Umwelttechnik GmbH, Schrobenhausen, Germany
EUR
100.00
BAUER Foralith GmbH, Schrobenhausen, Germany
EUR
100.00
GWE pumpenboese GmbH, Peine, Germany
EUR
100.00
Esau & Hueber GmbH, Schrobenhausen, Germany
EUR
100.00
hydesco24 GmbH, Hamburg, Germany
EUR
60.00
EU excluding Germany
GWE Budafilter Kft., Mezöfalva, Hungary
HUF
100.00
BAUER Ambiente S.r.l., Milan, Italy
EUR
100.00
BAUER SPEZIALTIEFBAU Gesellschaft m.b.H., Vienna, Austria
EUR
100.00
BAUER Technologies Limited, Bishops Stortford, Great Britain
GBP
100.00
BAUER RENEWABLES LIMITED, Beverley, Great Britain
GBP
100.00
BAUER EQUIPMENT UK LIMITED, Rotherham, Great Britain
GBP
100.00
BAUER Magyarország Speciális Mélyépítö Kft., Budapest, Hungary
HUF
100.00
Currency
161
Capital share
in %
RON
100.00
BAUER BULGARIA EOOD, Sofia, Bulgaria
BGN
100.00
BAUER Funderingstechniek B.V., Mijdrecht, Netherlands
EUR
100.00
BAUER Foundations (IRL) Ltd., Dublin, Ireland
EUR
100.00
GWE France S.A.S., Aspiran, France
EUR
100.00
TracMec Srl, Mordano, Italy
EUR
100.00
BAUER Macchine Italia Srl, Mordano, Italy
EUR
100.00
FAMBO Sweden AB, Eslöv, Sweden
SEK
100.00
GWE POL-Bud Sp.z.o.o, Lodz, Poland
PLN
100.00
BAUER RESOURCES SPAIN S.A., Leganes, Spain
EUR
100.00
BAUER Resources UK Ltd., Beverley, Great Britain
GBP
100.00
CHF
100.00
FORALITH Drilling Support AG, St. Gallen, Switzerland
CHF
100.00
OOO BAUER Maschinen - Kurgan, Kurgan, Russian Federation
RUB
65,00
OOO BAUER Maschinen SPb, St. Petersburg, Russian Federation
RUB
100.00
OOO BG-TOOLS-MSI, Ljuberzy, Russian Federation
RUB
55.00
OOO BAUER Maschinen Russia, Moscow, Russian Federation
RUB
100.00
OOO BAUER Technologie, Moscow, Russian Federation
RUB
100.00
BAUER Georgia Foundation Specialists LCC, Batumi, Georgia
GEL
100.00
Europe (other)
BAUER Spezialtiefbau Schweiz AG, Baden-Dättwil, Switzerland
D.
Saudi BAUER Foundation Contractors Ltd., Jeddah, Saudi Arabia
SAR
100.00
BAUER LEBANON FOUNDATION SPECIALISTS S.a.r.l., Beirut, Lebanon
USD
100.00
BAUER International FZE, Dubai, United Arab Emirates
AED
100.00
BAUER International Qatar LLC, Doha, Qatar
QAR
49.00 *
BAUER Equipment Gulf FZE, Dubai, United Arab Emirates
AED
100.00
BAUER Emirates Environment Technologies & Services LLC,
Abu Dhabi, United Arab Emirates
AED
49.00 *
BAUER Resources GmbH / Jordan Ltd. Co., Amman, Jordan (sub-group consolidated financial statements)
USD
100.00
USD
83.33
Site Group for Services and Well Drilling Ltd. Co., Ramallah, Palestine
USD
100.00
Site Drilling Ltd. Co., Limassol, Cyprus
USD
100.00
Site Group for Services and Well Drilling Ltd. Co., Amman, Jordan
BAUER Casings Makina Sanayi ve Ticaret Limited Sirketi, Ankara, Turkey
TRY
60.00
BAUER Corporate Services Private Limited, Mumbai, India
INR
100.00
AED
100.00
INR
100.00
BAUER Geotechnical Specialized Foundation LLC, Abu Dhabi, United Arab Emirates
BAUER Equipment India Private Limited, Delhi, India
2015
C.
BAUER ROMANIA S.R.L., Bucarest, Rumania
Continued: B. EU excluding Germany
162
E.
BAUER Foundations Australia Pty Ltd, Brisbane, Australia
P.T. BAUER Pratama Indonesia, Jakarta, Indonesia
MYR
100.00
AUD
100.00
IDR
100.00
BAUER Services Singapore Pte Ltd, Singapore
EUR
100.00
BAUER Hong Kong Limited, Hong Kong, People’s Republic of China
HKD
100.00
VND
100.00
PHP
100.00
BAUER Vietnam Ltd., Ho Chi Minh City, Vietnam
BAUER Foundations Philippines, Inc., Quezon City, Philippines
BAUER Technologies Far East Pte. Ltd. - (subsidiary consolidated financial statements), Singapore
EUR
100.00
BAUER EQUIPMENT SOUTH ASIA PTE. LTD., Singapore
EUR
100.00
BAUER Technologies Taiwan Ltd., Taipei, Taiwan
TWD
99.88
BAUER Tianjin Technologies Co. Ltd., Tianjin, People's Republic of China
CNY
100.00
BAUER Equipment Hong Kong Ltd., Hong Kong, People's Republic of China
EUR
100.00
BAUER Equipment (Malaysia) Sdn. Bhd., Shah Alam, Malaysia
MYR
100.00
Shanghai BAUER Technologies Co. Ltd., Shanghai, People's Republic of China
CNY
100.00
BAUER Equipment (Shanghai) Co. Ltd., Shanghai, People's Republic of China
CNY
100.00
NIPPON BAUER Y.K., Tokyo, Japan
JPY
100.00
Inner City (Thailand) Company Limited, Bangkok, Thailand
THB
49.00 *
Thai BAUER Co. Ltd., Bangkok, Thailand
THB
73.99
BAUER Equipment Australia Pty. Ltd., Baulkham Hills, Australia
AUD
100.00
BAUER FUNDACIONES PANAMÁ S.A., Panama City, Panama
USD
100.00
BAUER MEXICO, S.A. DE C.V., Mexico City, Mexico
MXP
100.00
BAUER Resources Canada Ltd., Edmonton, Canada
CAD
100.00
BAUER Foundations Canada Inc., Calgary, Canada
CAD
100.00
BAUER FOUNDATION CORP., Odessa, Florida, United States of America
USD
100.00
BAUER Resources Chile Limitada - (subsidiary consolidated financial statements),
Santiago de Chile, Chile
CLP
100.00
CLP
60.00
Americas
GWE Tubomin S.A., Santiago de Chile, Chile
G.
Capital share
in %
Asia-Pacific, Far East and Australia
BAUER (MALAYSIA) SDN. BHD. - (subsidiary consolidated financial statements), Petaling Jaya,
Malaysia
F.
Currency
BAUER Machinery USA Inc., Conroe, United States of America
USD
100.00
BAUER-Pileco Inc., Conroe, Texas, United States of America
USD
100.00
BAUER EGYPT S.A.E. Specialised Foundation Contractors, Cairo, Egypt
EGP
55.75
BAUER Technologies South Africa (PTY) Ltd. (subsidiary consolidated financial statements),
Cape Town, South Africa
ZAR
100.00
MINERAL BULK SAMPLING NAMIBIA (PTY) LTD, Windhoek, Namibia
NAD
100.00
MINERAL BULK SAMPLING SOUTH AFRICA (PTY) LTD, Cape Town, South Africa
ZAR
100.00
GHS
100.00
BAUER Resources Maroc S.A.R.L., Kenitra, Morocco
MAD
100.00
BAUER-DE WET EQUIPMENT (PROPRIETARY) LIMITED, Rasesa, Botswana
BWP
51.00
XOF
100.00
Africa
BAUER RESOURCES GHANA LIMITED, Accra, Ghana
BAUER Resources Senegal SARL, Dakar, Senegal
Associates and joint ventures
A.
Germany
Wöhr + Bauer GmbH (subsidiary consolidated financial statements), Munich, Germany
B.
33.33
Wöhr + Bauer Angerhof GmbH & Co. KG, Munich, Germany
EUR
100.00
Wöhr + Bauer Angerhof Verwaltungs GmbH, Munich, Germany
EUR
100.00
WÖHR + BAUER PARKING GmbH, Munich, Germany
EUR
100.00
Wöhr + Bauer H2O Verwaltungs GmbH, Munich, Germany
EUR
100.00
Wöhr + Bauer H2O GmbH & Co. KG, Munich, Germany
EUR
100.00
Wöhr + Bauer Projekt HTW Verwaltungs GmbH, Munich, Germany
EUR
100.00
Wöhr + Bauer Projekt HTW GmbH & Co. KG, Munich, Germany
EUR
100.00
WÖHR + BAUER Tower Riem Verwaltungs GmbH, Munich, Germany
EUR
100.00
WÖHR + BAUER Tower Riem GmbH & Co. KG, Munich, Germany
EUR
100.00
Riem Vermietungs GmbH, Muncih, Germany
EUR
100.00
WÖHR + BAUER Projekt A Verwaltungs GmbH, Munich, Germany
EUR
100.00
WÖHR + BAUER Projekt A GmbH & Co. KG, Munich, Germany
EUR
100.00
NDH Entsorgungsbetreibergesellschaft mbH, Bleicherode, Germany
EUR
25.00
Grunau und Schröder Maschinentechnik GmbH, Drolshagen, Germany
EUR
30.00
SPANTEC Spann- & Ankertechnik GmbH, Schrobenhausen, Germany
EUR
40.00
BAUER Deep Drilling GmbH, Schrobenhausen, Germany
EUR
51.00
TERRABAUER S. L., Madrid, Spain
EUR
30.00
NuBa Equipment Ltd., Edmonton, Canada
CAD
50.00
Bauer + Moosleitner Entsorgungstechnik GmbH, Salzburg, Austria
EUR
50.00
BAUER Nimr LLC, Maskat - Al Mina, Sultanate of Oman
OMR
49.00
BAUER Manufacturing LLC, Conroe, United States of America
USD
51.00
TOO SCHACHTBAU Kasachstan, Almaty, Kazakhstan
KZT
50.00
EUR
33.33
International
3.
Enterprises in which the company has participating interests
A.
Germany
TMG Tiefbaumaterial GmbH, Emmering, Germany
Nordhäuser Bauprüfinstitut GmbH, Nordhausen, Germany
EUR
20.00
Harz Hotel Grimmelallee Nordhausen Beteiligungsgesellschaft mbH, Nordhausen, Germany
EUR
20.00
EUR
20.00
EUR
4.11
RUB
15.00
Harz Hotel Grimmelallee Nordhausen GmbH & Co. KG, Nordhausen, Germany
Stadtmarketing Schrobenhausen e.G., Schrobenhausen, Germany
B.
EUR
Capital share
in %
International
OAO Mostostrojindustria, Moscow, Russian Federation
* Commercial ownership is 100 percent
2.
Currency
2015
163
164
We hereby assure that, to the best of our knowledge, the consolidated financial statements give a true and fair view of the
net assets, financial position and earnings of the company in accordance with the accounting principles applicable to financial
reporting, and that the Combined Management Report depicts the course of business, including the earnings and overall situation
of the Group, in such a way that a true and fair view is conveyed and the material opportunities and risks of the foreseeable
development of the Group are set out.
The Management Board
Prof. Thomas Bauer
165
Audit opinion
“We have audited the consolidated financial statements prepared by BAUER Aktiengesellschaft, Schrobenhausen, comprising
the balance sheet, the income statement and statement of comprehensive income, statement of changes in equity, cash flow
statement and the notes to the consolidated financial statements, together with the Group management report for the financial
year from January 1 to December 31, 2015. The preparation of the consolidated financial statements and the Group manage-
and the Group management report, based on our audit.
We conducted our audit of the consolidated financial statements in accordance with § 317 HGB and the generally accepted
German standards for the audit 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 audit such that misstatements materially
affecting the presentation of the net assets, financial position and results of operations in the consolidated financial statements
in accordance with the applicable financial reporting framework and in the Group management report are detected with reasonable
assurance. Knowledge of the business activities and the economic and legal environment of the Group and expectations as
to possible misstatements are taken into account in the determination of audit procedures. The effectiveness of the accounting-related internal control system and the evidence supporting the disclosures in the consolidated financial statements and
the Group management report are examined primarily on a test basis within the framework of the audit.
The audit includes assessing the annual financial statements of those entities included in consolidation, the determination of
the entities to be included in consolidation, the accounting and consolidation principles used and significant estimates made
by the company's Management Board, as well as evaluating the overall presentation of the consolidated financial statements
and the Group management report. We believe that our audit provides a reasonable basis for our opinion.
Our audit has not led to any reservations.
In our opinion, based on the findings of our audit, the consolidated financial statements comply with the IFRS as adopted
by the EU and the additional requirements of German commercial law pursuant to Paragraph 315a, Sub-paragraph 1 HGB,
and give a true and fair view of the net assets, financial position and results of operations of the Group in accordance with
these requirements. The Group management report is consistent with the consolidated financial statements, and as a whole
provides a suitable view of the Group's position, and suitably presents the opportunities and risks of future development.”
Stuttgart, March 31, 2016
Udo Bäder
Klaus Neubarth
Auditor
Auditor
2015
pursuant to § (Article) 315a, Abs. (paragraph) 1 HGB (“Handelsgesetzbuch”: German Commercial Code) are the responsibility of
the parent company's Management Board. Our responsibility is to express an opinion on the consolidated financial statements
ment report in accordance with the IFRS, as adopted by the EU, and the additional requirements of German commercial law
166
Glossary
A
EQUITY METHOD / AT EQUITY | The equity method is
used for recognizing shares in associated companies in the
ASSOCIATED COMPANIES | Material but not controlling
consolidated financial statements. The carrying amounts
influence can be asserted over associated companies
of the investments are amortized by the development of
The usual shareholding is between 20 5 and 50 %. These
proportional equity in the participating company.
companies are accounted for using the equity method.
F
C
FINANCIAL COVENANTS | Some credit agreements
CASH FLOW | This performance indicator shows the
contain clauses which stipulate specific thresholds for
amount of funds a company has generated with its own
specified financial performance indicators.
resources and how many it can re-use. Key components
are profit, depreciation and amortization, and increases in
FINANCIAL INSTRUMENT | Any contract resulting in a
provisions.
financial asset for one company and a financial liability (or
equity instrument) for another.
CONSOLIDATED REVENUES | Consolidated revenues are
stated in the income statement and comprise the revenues of
G
the (consolidated) companies fully included in the consolidated financial statements.
GROSS DOMESTIC PRODUCT (GDP) | the gross
domestic product corresponds to the total value of all goods
D
and services to end users produced and provided within an
economy during the course of a year. GDP is a benchmark
DRILLING | This term describes the construction of shafts
for an economy’s performance.
or bore holes for the extraction of deposits or mining of
resources.
H
DEEP DRILLING RIG | This series was specially developed
HGB FINANCIAL STATEMENTS | The German
for excavating particularly deep raw materials deposits by
Commercial Code (Handelsgesetzbuch; HGB) stipulates
way of drilling. The machines can drill more than 5,000
the requirements for the preparation of annual financial
meters deep and are used for excavating oil, gas, water and
statements and financial reporting for German capital
geothermal energy.
corporations.
E
I
EBIT | Earnings before interest and taxes. EBIT is the result
IFRS FINANCIAL STATEMENTS | The International
from operations before interest and taxes.
Financial Reporting Standards (IFRS) are accounting
policies for companies with a focus on the capital market.
EBITDA | Earnings before interest, taxes, depreciation
The International Accounting Standards Board (IASB)
and amortization. EBITDA is the result of interest, taxes,
publishes the standards and aim to ensure that annual and
depreciation and amortization (on property, plant and
consolidated financial statements can be compared on
equipment and intangible assets).
an international level. BAUER Group started preparing its
financial statements in accordance with IFRS in 2004.
EBIT MARGIN | The EBIT margin is a profitability indicator
and describes a Company's ratio between EBIT and sales
revenues.
GLOSSARY
NET RESULT FOR THE PERIOD | The net result for the
SALES REVENUES | Unlike performance, for which all
period, also called earnings after taxes, shows the profit or
goods manufactured are evaluated, sales revenues are all
loss during a specified period.
services and goods finally invoiced and sold during a specific
period recognized in the income statement. The difference
O
between both values mainly relates to changes in semi-finished goods, warehouses and other income.
ORDER BACKLOG | States a company’s order volume in
existence at the time the balance sheet is prepared.
SEGMENTS | The segments are the operating units of the
Group – in our case these are Construction, Equipment and
ORDER INTAKE | Corresponds to the total of all orders
Resources Each segment contains the holding company
received during a specified reporting period. Order intake is
and subsidiaries with equal product and/or service portfolios.
an indication of the future order volume.
SCHACHTBAU NORDHAUSEN GmbH is the only Group
company to operate in all three segments.
P
STAKEHOLDER | This term describes persons or groups
PERCENTAGE OF COMPLETION METHOD (POC) |
with a justified interest in the performance of a company.
This method is used for determining and recognizing the
Various stakeholders can have very different interests.
profit realization according to the percentage of completion
on the basis of order costs and income (actual values and
T
forecasts) for long-term orders.
TOTAL GROUP REVENUES | Total Group revenues
PREMIUMLINE | The PremiumLine comprises the
include revenues from the consolidated companies as well
multi-function devices of the rotary drilling rig series (BG)
as portions of revenues from associated companies and
designed for diverse applications in specialist foundation
revenues of non-consolidated subsidiaries and joint ventures.
engineering. It is also possible to attach deep vibrators or
trench cutters.
R
V
VALUELINE | The ValueLine comprises rotary drilling rigs
(BG) optimized exclusively for the kelly drilling method.
ROTARY DRILLING RIG (BG) | BAUER Maschinen GmbH
specializes in the construction and development of rotary
VALUE CREATION | Value creation is a company’s
drilling rigs. The machines are produced on two lines, the
contribution to society. Value creation reflects how the
PremiumLine and ValueLine. These devices can be used for
performance of a company is distributed across diverse
diverse applications in specialist foundation engineering.
stakeholders.
REVENUE | The revenue comprises sales revenues, changes
W
in inventories, other capitalized goods and services for own
account and other operating income of the respective sub-
WORKING CAPITAL | Working capital is the part of current
sidiary, associated company or joint venture.
assets tied by the operative production process and the sale
of services (e.g. receivables).
S
2015
N
167
168
IMPRINT
Published by
Registered place of business
86529 Schrobenhausen, Germany
BAUER-Strasse 1
Registered at the District Court of
Ingolstadt under HRB 101375
www.bauer.de
Print
Photos
Hupfauf Druck,
BAUER Group
Schrobenhausen
Press photo Roche
Erich Meyer aerial photo (p. 5)
Press photo Roche (p. 60)
Contact
http://ir.bauer.de
Investor Relations
BAUER-Strasse 1
http://www.youtube.com/
BAUER Group
Tel.: +49 8252 97-1215
Fax: +49 8252 97-2900
This Annual Report is published
[email protected]
in German and English.
GROUP KEY FIGURES: INCOME STATEMENT AND BALANCE SHEET
>>>
Construction
BAUER Spezialtiefbau GmbH, the original
parent company of the BAUER Group, has
been a major driving force in the development
of specialist foundation engineering, and
carries out projects all over the world. Bauer
Spezialtiefbau is organized on a regional basis
in Germany, and operates on all the world's
continents with over 50 subsidiaries and
branch offices. Market trends have meant that
most of the company’s revenues are now generated outside of Germany. Bauer has major
subsidiaries and branch offices in the United
Arab Emirates, Malaysia, Egypt and the USA
among other locations. Bauer Spezialtiefbau
has built up networks in numerous regions
across the world, enabling it to acquire and
execute contracts both in the countries in
which it is represented and in neighbouring
countries, using its own machinery and inhouse engineering consultancy. In addition to
the predominant field of specialist foundation
engineering, Group companies SCHACHTBAU
NORDHAUSEN GmbH, SPESA Spezialbau
und Sanierung GmbH and Wöhr + Bauer
GmbH also carry out general construction activities such as civil engineering, environmental
engineering and project development.
Equipment
The BAUER Maschinen Group is the world
market leader in the development and manufacture of specialist foundation engineering
equipment. BAUER Maschinen GmbH – the
holding company for a number of subsidiaries
– designs and builds heavy-duty drilling rigs,
trench cutters, grab systems, vibrators and
deep drilling rigs, as well as the related tooling, at its plants in Schrobenhausen, Aresing
and Edelshausen. The company also operates
manufacturing facilities in the USA, Russia,
China, Malaysia, Italy, Singapore and Turkey.
It is supplied with components from within the
BAUER Group by Schachtbau Nordhausen
and Olbersdorfer Guß. The BAUER Maschinen
Group operates a global sales and service
network.
Resources
The Resources segment is focused on
products and services in the areas of
water, environment and natural resources.
BAUER Resources GmbH is the holding
company, under the umbrella of which the
subsidiaries operate as full-service providers.
The competence centers of Water Treatment,
Process and Biotechnology, Environmental
Rehabilitation and Waste Management, Drilling
Technologies as well as Well Drilling and Geothermal pool their expertise and support the
subsidiaries in carrying out projects.
Consolidated statement of profit or loss
in EUR '000
12M/2014
12M/2015
SALES REVENUES
Change
1,375,679
1,378,991
26,622
28,994
8.91 %
14,696
22,748
54.79 %
Other income
0.24 %
89,022
157,213
76.60 %
1,506,019
1,587,946
5.44 %
Cost of materials
-749,247
-752,532
0.44 %
Staff costs
-355,250
-376,118
5.87 %
-78,781
-81,143
3.00 %
-15,789
-13,195
-16.43 %
-230,526
-274,235
18.96 %
76,426
90,723
18.71 %
7,096
4,972
-29.93 %
-45,149
-41,982
-7.01 %
-572
2,672
n/a
OPERATING RESULT
Financial income
Financial expenses
Share of the profit or loss of associated companies
accounted for using the equity method
EARNINGS BEFORE TAX
Income tax expense
37,801
56,385
49.16 %
-22,075
-27,393
24.09 %
15,726
28,992
84.36 %
31.12.2014
31.12.2015
Consolidated balance sheet
ASSETS in EUR '000
Change
NON-CURRENT ASSETS
Intangible assets
34,440
27,455
-20.28 %
446,909
404,356
-9.52 %
42,906
132,553
n/a
3,613
3,613
0.00 %
30,973
27,190
-12.21 %
7,492
7,722
3.07 %
28,420
15,355
-45.97 %
594,753
618,244
3.95 %
Inventories
439,184
444,629
1.24 %
496,650
544,329
9.60 %
2,661
2,300
-13.57 %
Participations
Deferred tax assets
CURRENT ASSETS
Effective income tax refund claims
EQUITY AND LIABILITIES in EUR '000
41,835
47,406
13.32 %
980,330
1,038,664
5.95 %
1,575,083
1,656,908
5.19 %
31.12.2014
31.12.2015
399,308
438,842
9.90 %
19,617
12,368
-36.95 %
418,925
451,210
7.71 %
-3.50 %
Change
EQUITY
Equity of BAUER AG shareholders
NON-CURRENT LIABILITIES
116,358
112,284
Financial liabilities
387,816
393,694
1.52 %
5,959
7,262
21.87 %
13,123
20,664
57.46 %
523,256
533,904
2.03 %
CURRENT LIABILITIES
Financial liabilities
299,698
318,700
6.34 %
305,861
317,785
3.90 %
81.98 %
Effective income tax obligations
Provisions
9,317
16,955
18,026
18,354
1.82 %
632,902
671,794
6.15 %
1,575,083
1,656,908
5.19 %
In the “Change” column, there may be differences from the Group key figures as a result of roundings and a different representation
between thousands of EUR and millions of EUR.
Financial calendar 2016
April 18, 2016
Publication Annual Report 2015
Annual Press Conference
Analysts' Conference
May 13, 2016
Quarterly Statement Q1 2016
June 23, 2016
Annual General Meeting
August 12, 2016
Half-Year Interim Report to June 30, 2016
November 14, 2016
Quarterly Statement 9M/Q3 2016
BAUER-Strasse 1
www.bauer.de

Annual Report 2015

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