WASHINGTON (dpa-AFX) - Shares of SGS Group (SGSOY.PK) were gaining around 4 percent in the early morning trading in Switzerland after the inspection, verification, testing and certification company reported Friday organic growth in fiscal 2023 income and sales. Further, SGS launched its Strategy 2027 to drive profitable growth, and streamline the organization, expecting improvement in margin and sales.
Separately, SGS announced the appointment of Geraldine Picaud as Chief Executive Officer, effective from the Annual General Meeting of March 26. She will succeed Frankie Ng who has expressed his desire to step down.
Picaud joined SGS on December 1, 2023 to lead Finance, Digital and Strategic Transformation, Mergers & Acquisitions, IT and Procurement.
Prior to this, she was Group Chief Financial Officer and member of the Executive Committee at Holcim. She also served as Group CFO and member of the Executive Committee at Essilor International.
In fiscal 2023, adjusted operating income was 971 million Swiss francs, an organic growth of 6.3 percent. The adjusted operating income margin on sales was 14.7 percent, a decline of 0.7 percentage points compared to prior year.
Sales were 6.62 billion francs, an organic growth of 8.1 percent driven by all business lines. The company recorded a double-digit increase in Business Assurance and high single-digit growth in Natural Resources and Industries & Environment.
The company noted that all business lines and regions contributed to the performance, with particularly strong growth in sustainability services, cybersecurity, ESG assurance and consulting.
Over the next four years, by 2027, the company targets organic sales growth of 5 percent to 7 percent annually, and significant improvement of at least 1.5 percentage points in adjusted operating income margin on sales by 2027.
SGS will implement a cost-disciplined operating model and a corporate-light structure. The simplification is expected to create cost savings of 100 million francs resulting in a new run rate reached at the end of 2025.
A new Executive Committee of 12 members will be appointed to foster accountability.
In Switzerland, SGS shares were trading at 77.82 francs, up 3.68 percent.
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