Press Release: DYNAMIC GROWTH -- NEW SALES RECORD IN FIRST QUARTER -- ANNUAL TARGET RAISED
DYNAMIC GROWTH -- NEW SALES RECORD IN FIRST QUARTER -- ANNUAL TARGET
RAISED
-- Sales increase of 12.6% in local currencies
-- Q1 sales of CHF 1,998.6 million (+10.2% in CHF)
-- Negative currency effect of --2.4%
-- Acquisition of Kreps (Russia), DriTac (USA), and BR Massa (Brazil)
-- Outlook for 2021 fiscal year
-- Double-digit sales growth in local currencies (previously: local
currency growth of 6%--8%)
-- Over-proportional increase in EBIT, EBIT margin to reach 15% for
the first time
-- Confirmation of 2023 strategic targets for sustainable, profitable growth
Despite the ongoing COVID-19 pandemic, Sika has had a dynamic start to
the 2021 fiscal year, continuing its growth trajectory in the first
quarter with a new sales record of CHF 1,998.6 million. This equates to
an increase of 12.6% in local currencies. Sales growth in Swiss francs
amounted to 10.2%, which includes a negative currency effect of --2.4%.
The acquisition effect was 1.5%. Organic growth in the first quarter
amounted to 11.1%.
Paul Schuler, Chief Executive Officer: "As the new year got underway, we
were able to seamlessly build on our strong performance in the fourth
quarter of last year. We made targeted use of our growth momentum and
further expanded market shares in the majority of our markets. Both in
the project business and the distribution business, we are benefiting
from strong customer demand for our high-quality, innovative, and
sustainable solutions. These not only help our customers master their
projects and challenges, but also contribute to greater sustainability
in the construction sector and to environmentally-friendly mobility. The
COVID-19 pandemic will be with us in 2021 too. After a year's experience
of doing business in this environment, it is clear that we are on the
right course with the implementation of numerous digital initiatives and
are benefiting from the added value these provide, as well as from the
strength of our customer relationships."
GROWTH IN ALL REGIONS -- DOUBLE-DIGIT GROWTH IN EMEA AND ASIA/PACIFIC
The first quarter of the 2021 fiscal year remained affected by the
COVID-19 pandemic, and by logistical challenges in particular. Thanks to
its strong market position and the rapid, targeted implementation of
growth initiatives, Sika was able to achieve record results in all
regions.
In the first quarter of 2021, the EMEA region recorded a sales increase
in local currency of 13.2% (previous year: 13.3%). Business developed
well in Germany, Austria, and Switzerland (the "DACH" area), the Nordic
countries, Eastern Europe, and the Middle East. A boost in growth was
witnessed in the countries of southern Europe, with Italy, France, and
the UK, as well as in Africa.
In the period under review, Sika acquired Kreps LLC, a leading
manufacturer of mortar products in Russia, thereby further expanding
both its existing product portfolio and its geographical presence in
this market.
The Americas region recorded growth in local currencies of 6.2%
(previous year: 23.0%). In the Americas region, Sika saw a clear uptrend,
despite the high COVID-19 infection rates recorded in Mexico, Brazil,
and the USA. While many large urban centers in North America continue to
be affected by the pandemic and construction projects are being delayed,
the situation in Latin America has improved markedly.
In the first quarter of 2021, Sika acquired the flooring adhesives
business segment of DriTac, a US-based company with a particularly
strong market position in the area of adhesive bonding for flooring
systems. Furthermore, BR Massa, a manufacturer of mortar products in
Brazil was brought into the Sika Group. Thanks to this acquisition, Sika
will improve its position in one of the leading economic regions of
Brazil, as well as expanding its production capacity.
Sales in local currencies in the Asia/Pacific region increased by 25.8%
(previous year: 29.8%), with China in particular enjoying yet another
surge in growth momentum with double-digit organic growth rates.
Australia and India were also able to contribute to the positive
business development of this region. By contrast, the countries of the
Southeast Asia region have been recovering only slowly from the
far-reaching effects of the pandemic.
In the Global Business segment, Sika achieved growth in local currencies
of 2.7% (previous year: --7.1%). In the first quarter of the current
financial year, the automotive industry experienced major bottlenecks in
the electronic parts supply chain. Not until March were vehicle
production rates once again rising significantly in all regions. For the
year 2021, the automotive industry is expected to grow by 10%. Sika is
expecting long-term growth stimuli from the megatrends evident in modern
automotive construction, which will continue to be dominated by
electromobility and lightweight construction.
CONTINUATION OF SUCCESSFUL GROWTH STRATEGY -- ANNUAL TARGET RAISED
Despite the coronavirus crisis and its repercussions for operating
results, Sika is confirming its 2023 strategic targets. The company is
still clearly aligned for long-term success and profitable growth. With
its focus on the six strategic pillars -- market penetration, innovation,
operational efficiency, acquisitions, strong corporate values, and
sustainability -- Sika is seeking to grow by 6%--8% a year in local
currencies up to 2023. From 2021, the company is aiming to increase its
EBIT margin to 15%--18%. Projects in the areas of operations, logistics,
procurement, and product formulation should result in an annual
improvement in operating costs equivalent to 0.5% of sales.
For the 2021 fiscal year, Sika is expecting double-digit sales growth in
local currencies (previously: sales growth in local currencies of
6%--8%) and an over-proportional increase in EBIT. The EBIT margin
should for the first time reach 15%.
LIVE INTERNET BROADCAST OF THE ANNUAL GENERAL MEETING
The Annual General Meeting of Sika AG will take place at 4 p.m. today,
and will be broadcast live. In accordance with the Federal Council's
Ordinance to combat coronavirus, it is once again not possible for
shareholders to attend the Annual General Meeting in person. Instead,
they can cast their vote through the independent proxy. Sika is also
giving all its shareholders the opportunity to directly ask questions
verbally during the meeting via an online platform. As part of the
Annual General Meeting, Chief Executive Officer Paul Schuler will
comment on business development in the first quarter of 2021 as well as
the outlook.
NET SALES IN THE FIRST THREE MONTHS OF 2021
1.1.2020 1.1.2021
- - Year-on-year change
In CHF mn 31.3.2020 31.3.2021 (+/- in %)
-------------- --------- --------- --------------------------------------------------------
In local Currency Acquisition Organic
In CHF currencies(1) effect effect(2) growth(3)
-------------- --------- --------- ------ ------------- -------- ----------- ----------
By region(4)
-------------- --------- --------- ------ ------------- -------- ----------- ----------
EMEA 810.7 914.7 12.8 13.1 -0.3 3.5 9.6
-------------- --------- --------- ------ ------------- -------- ----------- ----------
Americas 485.7 481.0 -1.0 6.2 -7.2 0.0 6.2
-------------- --------- --------- ------ ------------- -------- ----------- ----------
Asia/Pacific 338.2 422.8 25.0 25.8 -0.8 0.0 25.8
-------------- --------- --------- ------ ------------- -------- ----------- ----------
Global
Business 179.0 179.1 0.1 2.7 -2.6 0.0 2.7
-------------- --------- --------- ------ ------------- -------- ----------- ----------
Net sales 1,813.6 1,997.6 10.1 12.6 -2.5 1.5 11.1
-------------- --------- --------- ------ ------------- -------- ----------- ----------
Products for
the
construction
industry 1,428.9 1,591.8 11.4 13.9 -2.5 2.0 11.9
-------------- --------- --------- ------ ------------- -------- ----------- ----------
Products for
industrial
manufacturing 384.7 405.8 5.5 7.8 -2.3 0.0 7.8
-------------- --------- --------- ------ ------------- -------- ----------- ----------
1. Growth in local currencies including acquisitions.
2. Share of sales of acquired companies not including
post-combination growth. The sales growth of the
acquired companies since initial consolidation is
included in organic growth.
3. Growth adjusted for acquisition and currency effect.
The sales growth of the acquired companies since
initial consolidation is included in organic growth.
4. The Advanced Resin business has been reallocated from
the Global Business segment to the geographical
regions. Link
https://www.sika.com/en/media/media-releases/2021/restated-2020-figures.html
to restated 2020 figures.
FINANCIAL CALENDAR
Half-Year Report 2021 Thursday, July 22,
2021
Results first nine months 2021 Friday, October 22,
2021
Net sales 2021 Tuesday, January 11,
2022
Media conference/analyst presentation on 2021 Friday, February 18,
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