Nine Month Result 2018: Sika Achieves Record Sales and Profit

GROWTH IN ALL REGIONS

In the first nine months of the year, sales in the EMEA region (Europe, Middle East, Africa) increased by 14.4% (previous year: 6.8%). The core markets of Spain and the UK recorded high single-digit growth. Double-digit growth rates were recorded in the Middle East, Africa, and Eastern Europe.

With its acquisition of Index Construction Systems and Products, Sika has gained a leading manufacturer of waterproofing systems for roofs and building structures headquartered near Verona, Italy. In the reporting period Sika also acquired Polypag, a leading Swiss-based manufacturer and developer of polyurethane foam systems. Production capacity was increased in Senegal, Saudi Arabia, Dubai and Azerbaijan through the commissioning of new factories for concrete admixtures and mortar products.

The newly established Americas region recorded growth of 13.0% in the first nine months of 2018 (previous year: 11.1%). The USA managed to record double-digit growth thanks to strong demand in key target markets. The development of business in Mexico, Argentina, and Brazil was above-average. The basis for further growth in Central America was laid with the establishment of a new national subsidiary in Honduras.

Growth in the Asia/Pacific region amounted to 4.8% (previous year: 4.9%). Here the highest growth rates were recorded by India and China. In Vietnam, a state-of-the-art facility for mortar production has come on stream in the Bac Ninh plant alongside the existing production of concrete admixtures. This has enabled Sika to expand its supply chain in this country’s booming construction market.

The new Global Business segment recorded a growth rate of 29.9% (previous year: 9.2%), of which 22.7% is attributable to the acquisition of Faist ChemTec. This new segment includes the globally managed automotive business as well as the two businesses Advanced Resins (formerly Axson Technologies) and Faist. Both are centrally managed and are established providers of components and solutions for automotive and other industries. Thanks to structural growth and greater market penetration, Sika recorded an increase of 6% in the third quarter in the automotive area, which is significantly higher than the overall market performance. A new automotive factory for the production of acoustic and body reinforcement systems was opened in Querétaro, in order to derive even greater benefit from the strong Mexican automotive market.  

OUTLOOK 2018: CONFIRMATION OF SALES TARGET OF MORE THAN CHF 7 BILLION ̶ DOUBLE-DIGIT GROWTH IN BOTH EBIT AND NET PROFIT

Based on the result for the first nine months of the current financial year, Sika is confirming its target for full year 2018 – namely an increase in sales of more than 10% to reach CHF 7 billion for the first time. Volatile and rising raw material prices continue to pose a challenge. Despite the one-off costs incurred in connection with resolving the takeover dispute and the higher raw material prices, Sika is expecting double-digit growth rates for both EBIT and net profit for the year as a whole. The growth strategy will be continued in 2018 with the opening of at least eight new factories and further acquisitions in the highly fragmented construction chemicals market.  

¹ Including acquisitions