Half-Year Report 2010: Sika improves profit and continues to gain market share
(Thomson Reuters ONE) -
Sika AG / Half-Year Report 2010: Sika improves profit and continues to gain market share processed and transmitted by Hugin AS. The issuer is solely responsible for the content of this announcement.
Sika grew in all Regions in the first half-year of 2010 in terms adjusted for
exchange rates. In emerging markets, double-digit growth rates were achieved
throughout. With material costs initially still low and those for personnel
reduced, operating profit increased considerably. For the second half-year the
company anticipates sustained growth with rising material costs.
In the first half-year of 2010, Group sales growth in local currency terms
amounted to 6.7%. This includes an acquisition effect of 1.9%. Exchange rate
fluctuations bore a negative effect of -1.1%, so that in comparison with the
first half year of the year prior sales in Swiss francs grew by 5.6% from CHF
1982.9 million to CHF 2094.3 million.
In terms adjusted for exchange rates, Sika grew in all Regions, albeit with
substantially varying rates. Thus the emerging markets achieved double-digit
growth throughout, with the highest rate in Region Asia/Pacific at 23.8%. Within
this Region, China excelled with a growth rate of some 40%. In Region Latin
America sales rose by 15.4%, followed by IMEA (India, Middle East, Africa) with
growth of 12.8%. In the traditionally industrial nations growth rates proved
lower: North America 5.6%, Europe North 2.2% and Europe South 1.3%. Sika thereby
continued to gain market share.
In the first quarter of this year, lingering snowy winters in Europe and North
America strongly hindered building activity, substantially impacting sales of
products for outdoor applications. Conditions normalized in the second quarter,
and overall sales of products for the building industry rose by over 7%. For the
entire reporting period sales growth in terms adjusted for exchange rates
amounted to 3.5%, including an acquisition effect of 2.2%. Sales of products for
industrial manufacturing accelerated by 20.1% (0.5% due to acquisitions).
Contributing to this success were both the considerable number of new vehicle
models that Sika won in years 2008 and 2009 and which are now leaving
manufacturers' assembly lines, as well as the substantially boosted production
figures for automobiles, busses and also commercial vehicles, in comparison with
the same period in the previous year.
During the reporting period the effective material costs remained at the reduced
level of the second half-year of 2009, so that as a proportion of sales gross
profit improved by 0.9 percentage points. As a result of cost reduction
programs, personnel costs declined as a proportion of sales from 24.4% to
22.6%. Other operating expenses developed in accordance with sales volume.
Operating profit before depreciation, EBITDA, improved by 32.8% to CHF 284.2
million, yielding an EBITDA margin of 13.6%. Operating profit amounted to CHF
216.5 million, so lying 46.0% above the reporting period of the previous year.
Acquisitions
In the period under review Sika rigorously pursued its acquisition strategy,
taking over various companies or parts thereof, among others the automotive
glass replacement business of ADCO Ltd., USA, Henkel Japan Ltd.'s building
sealants business, and Panbex of the Czech Republic. By assuming a majority
position in the Japanese Dyflex HD Co., Ltd., which with well established brands
and distribution channels is market leader in Japan for waterproofing of
structures, Sika substantially improved its market position in Japan. Dyflex's
products and technologies complement Sika's offerings, and the merger of product
portfolios enables Sika to provide customers in Japan and the entire Region
Asia/Pacific with a full palette of waterproofing systems and solutions. With
this acquisition Sika tripled its sales in Japan.
Outlook
Sika anticipates continued growth for the second half-year, above all in
emerging markets. Even if general economic growth should slacken in individual
emerging countries, possibilities for growth through greater market penetration
remain unrestricted. The mild recovery in North America should continue.
Cyclical development in Europe stands entirely open: the effects of governmental
debt policy and respectively of the subsequent national remediation measures are
not yet foreseeable. For a number of countries an outlook at present is hardly
possible. Raw material prices have risen in recent months and will impact
material costs in the second half-year. Whenever possible Sika will transfer
this cost increase to sales prices.
Details relating to today's conference call can be found on page 4
Change
in CHF mn 1/1/2009-6/30/2009 1/1/2010-6/30/2010 in %
Sika Group
Net sales 1'982.9 2'094.3 5.6
Operating profit before depreciation
(EBITDA) 214.0 284.2 32.8
Depreciation/Amortization/Impairment -65.7 -67.7 3.0
Operating profit (EBIT) 148.3 216.5 46.0
Net profit after taxes 92.1 150.5 63.4
Earnings per share in CHF[1] 37.09 60.42 62.9
Cash flow from operating activities 83.3 56.0
Free cash flow -120.1 -30.5
Operating free cash flow 6.9 13.2
Balance sheet total 3'512.5 3'870.8 10.2
Shareholders' equity 1'469.6 1'624.0 10.5
Equity ratio in %[2] 41.8 42.0 0.5
Return on capital employed (ROCE) in
%[3] 14.0 20.6 47.1
[1] Excluding minority interests
[2] Shareholders' equity divided by balance sheet total
[3] Capital employed = operating assets. /.cash and cash equivalents./.non
interest-bearing current liabilities (each at average value)
Detailed information on the half-year results can be found in our Half-Year
Report 2010. Information can be downloaded directly from our website
www.sika.com or obtained in printed form from the above address.
Conference call today, July 30, 2010 at 3 pm (CEST)
In connection with the publication of the half-year results a conference call
will be held today. Please dial in 10 to 15 minutes before the start at
+41 (0) 91 610 56 00 (Europe)
+1 (1) 866 291 41 66 (USA)
+44 (0) 207 107 06 11 (UK)
An operator will then connect you with Ronald Trächsel (CFO) and Rainer Weihofen
(IR).
The conference call will be recorded and remains retrievable for 72 hours under
the following numbers:
+41 (0) 91 612 43 30 (Europe)
+1 (1) 866 416 25 58 (USA)
+44 (0) 207 108 62 33 (UK)
Upon request please enter the code 11924, followed by the #sign.
Sika AG Contact: Rainer Weihofen,
Zugerstrasse 50 Corporate Communications & Investor Relations
CH-6341 Baar, Switzerland Tel.: +41 58 436 68 00
www.sika.com Fax: +41 58 436 68 50
weihofen.rainer(at)ch.sika.com
Sika AG Corporate Profile
Sika AG, located in Baar, Switzerland, is a globally active company supplying
the specialty chemicals markets. It is a leader in processing materials used in
sealing, bonding, damping, reinforcing and protecting load-bearing structures in
construction (buildings and infrastructure construction) and in industry
(vehicle, building component and equipment production).
Sika's product lines feature high-quality concrete admixtures, specialty
mortars, sealants and adhesives, damping and reinforcing materials, structural
strengthening systems, industrial flooring as well as roofing and waterproofing
systems. Subsidiaries in more than 70 countries worldwide and approximately
12 000 employees link customers directly to Sika and ensure the success of all
our partners. Sika achieves annual sales of CHF 4.2 billion. Visit our website
atwww.sika.com.
The media release and the report can be downloaded from the following links:
[HUG#1434908]
--- End of Message ---
Sika AG
Zugerstrasse 50 Baar null
WKN: 858573;ISIN: CH0000587979;
Media Release : http://hugin.info/100359/R/1434908/380454.pdf
Half-year results 2010 - PDF: http://hugin.info/100359/R/1434908/380453.pdf
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Source: Sika AG via Thomson Reuters ONE
Unternehmensinformation / Kurzprofil:
Datum: 30.07.2010 - 05:00 Uhr
Sprache: Deutsch
News-ID 34844
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