Ad Hoc Announcement Pursuant to Article 53 of the SIX Exchange Regulation Listing Rules
SALES RISE BY 12.4% THANKS TO MBCC ACQUISITION – SIGNIFICANT PROFITABILITY INCREASE IN Q3
- Sales of
CHF 8,449.2 million (+5.6% in CHF) after nine months of the fiscal year - Sales growth of 12.4% in local currencies (negative foreign currency impact of -6.8%)
- Expansion of material margin to 53.1% (previous year-period: 49.3%)
- Increase in EBIT margin adjusted for acquisition-related costs to 14.8% (previous year-period: 13.8%)
- In Q3 EBIT increased by +24.3% (compared to Q3 2022)
- Operating free cash flow significantly increased to
CHF 877.3 million (previous year-period:CHF 422.4 million ) - Successful integration of MBCC and increase in synergies from
CHF 160-180 million toCHF 180-200 million - Acquisition of
Thiessen Team (USA ) andChema (Peru) - Opening of new plants in Kharagpur (
East India ) andChattanooga (Tennessee, USA ) - Outlook for fiscal 2023 confirmed:
- Sales increase in local currencies of more than 15% (including MBCC)
- Over-proportional increase in EBIT (excluding MBCC acquisition)
- Operating free cash flow (as % of net sales) of over 10% expected
Even in a challenging economic and geopolitical environment, Sika performed well in the first nine months of fiscal 2023. Despite a sharp rise in interest rates with the corresponding negative impact on the construction industry, sales rose to
STRONG EXPANSION OF MATERIAL MARGIN
In the current fiscal year, Sika has significantly increased its material margin to 53.1% (previous year: 49.3%). The company has therefore made further progress on the pathway back to a sustainable margin recovery. Adjusted EBIT increased to
Sika is expecting the overall acquisition and integration costs relating to the MBCC acquisition will amount to
Operating free cash flow significantly increased to
DOUBLE-DIGIT SALES GROWTH ACROSS ALL REGIONS
The EMEA region (
Once again, business activity was subdued both in the DACH region (
In local currency terms, the
At the start of July, Sika reported the takeover of
Sales in the
In June, Sika opened a new factory in Kharagpur in the east of
In the Global Business segment, Sika achieved growth in local currencies of 13.3% (previous year: 22.0%). Growth in the automotive business surpassed that of the overall market. The background to this increase is robust demand for new vehicles, particularly electric vehicles, along with normalization of the supply chains. However, the strike in the US automotive sector in September had a negative impact on growth.
Sika is continually developing its spectrum of solutions for battery systems. These include, for example, heat-conducting adhesives for the latest generation of battery-driven electric vehicles. Sika gained a record level of new orders in the automotive business during the first nine months of 2023. The newly acquired platforms will generate sales within a timeframe of two to three years and ensure sustainable strong performance of this business.
OUTLOOK FOR THE FULL 2023 YEAR CONFIRMED
In October, Sika unveiled its Strategy 2028 “Beyond the Expected”, including the associated medium-term targets. The new strategy will enable Sika to grow profitably over the long term even in a challenging economic environment. Thanks to its innovative technologies, Sika is the partner of choice for many customers in the construction and industrial sectors. These sectors are being heavily shaped by the sustainability megatrend, as well as by increasing urbanization, resource scarcity, automation, digitalization, and the trend toward easy-to-apply products.
For fiscal 2023 Sika expects sales in local currencies to rise by over 15%, including the MBCC acquisition effects. At the same time, Sika is confirming an expected over-proportional rise in EBIT, excluding the MBCC acquisition. Operating free cash flow should reach over 10% of net sales for the year.
KEY FIGURES FOR FIRST NINE MONTHS OF 2023
in CHF mn | Change in % | ||
Net sales | 7,998.5 | 8,449.2 | 5.6% |
Gross result | 3,941.8 | 4,487.9 | 13.9% |
Operating profit before depreciation (EBITDA) | 1,521.4 | 1,502.7 | -1.2% |
Operating profit (EBIT) | 1,231.5 | 1,144.8 | -7.0% |
Profit after taxes | 885.9 | 736.5 | -16.9% |
EBIT ADJUSTED FOR ONE-TIME M&A EFFECTS
in CHF mn | Change | ||
Reported operating profit (EBIT) | 1,231.5 | 1,144.8 | |
Divestment gain1 | -168.0 | 0.0 | |
M&A and integration cost2 | 39.0 | 105.3 | |
EBIT adjusted for one-time M&A effects | 1,102.5 | 1,250.1 | +13.4% |
EBIT margin adjusted for one-time M&A effects | 13.8% | 14.8% | +100 bps |
1 Divestment of European industrial coatings business. 2 Cost related to the acquisition of MBCC. |
NET SALES BY REGION
in CHF mn | Year-on-year change (+/- in %) | |||||||
In CHF | In local currencies1 | Currency effect | Acquisition effect2 | Organic growth3 | ||||
By region | ||||||||
EMEA | 3,221.9 | 3,377.5 | 4.8% | 10.6% | -5.8% | 12.8% | -2.2% | |
2,427.2 | 2,616.1 | 7.8% | 14.0% | -6.2% | 13.9% | 0.1% | ||
1,756.0 | 1,813.6 | 3.3% | 13.5% | -10.2% | 8.1% | 5.4% | ||
Global Business | 593.4 | 642.0 | 8.2% | 13.3% | -5.1% | 0.0% | 13.3% | |
Net sales | 7,998.5 | 8,449.2 | 5.6% | 12.4% | -6.8% | 11.1% | 1.3% | |
Products for construction industry | 6,611.1 | 7,082.1 | 7.1% | 14.2% | -7.1% | 13.5% | 0.7% | |
Products for industrial manufacturing | 1,387.4 | 1,367.1 | -1.5% | 4.5% | -6.0% | 0.0% | 4.5% | |
1 Growth in local currencies including acquisitions. 2 Sales contribution by acquired companies without considering the growth after business combination. Includes lost sales of discontinued operations. Sales growth of the acquired business since initial consolidation is included in organic growth. 3 Growth adjusted for acquisition, discontinued operations, and currency effect. Sales growth of the acquired business since initial consolidation is included in organic growth. |
Webcast on |
A webcast will take place today focusing on the results for the first nine months of the year. Please log in 5 minutes prior to the start of the event. www.sika.com/9months-webcast This link will allow you to participate in the webcast with You will also be able to find a recording of the webcast in the “Investors” section of the Sika website. |
FINANCIAL CALENDAR | |
Net sales 2023 | |
Media conference / analyst presentation | |
on full-year results 2023 56th Annual General Meeting | |
Net sales first quarter 2024 | |
Half-year report 2024 | |
Results first nine months 2024 |
CONTACT
Corporate Communications &
Investor Relations
+41 58 436 68 21
slappnig.dominik@ch.sika.com
SIKA CORPORATE PROFILE
Sika is a specialty chemicals company with a globally leading position in the development and production of systems and products for bonding, sealing, damping, reinforcing, and protecting in the building sector and motor vehicle industry. Sika has subsidiaries in 103 countries, manufactures in over 400 factories, and develops innovative technologies for customers around the world that facilitate the sustainable transformation of the construction and transportation industries. With more than 33,000 employees, the company generated annual sales of
The media release can be downloaded from the following link:
Media Release
Stakeholder Letter 9 Months 2023
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