SGS continues to feel the strength of the Swiss franc in the first half of the year
Published: Wednesday, Jul 24th 2024, 06:40
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The goods testing and inspection group SGS achieved higher sales in the first half of 2024, but earned slightly less on the bottom line. Unfavorable exchange rates continued to put pressure on profitability. Meanwhile, the Geneva-based company is sticking to the forecast for the year announced in January.
According to a press release issued on Wednesday, sales rose by 1.6% to 3.34 billion Swiss francs in the first half of the year. Adjusted for currency effects as well as acquisitions and disposals of business units and companies, it increased by 8.0 percent.
Meanwhile, SGS was able to maintain its profitability in a difficult currency environment, thanks in part to the recently launched restructuring program. The operating result adjusted for special factors rose by 1.9 percent to CHF 471 million. The EBIT margin thus remained constant at 14.1 percent. The bottom line was a slightly lower profit of CHF 267 million, compared with CHF 272 million previously.
With these figures, SGS clearly exceeded analysts' expectations in terms of turnover and operating profit. At the bottom line, these were more or less achieved.
Outlook confirmed
Meanwhile, SGS is optimistic for the current year. The Group confirms the outlook formulated at the beginning of the year. According to this, profitability should continue to increase until the end of the year.
SGS is also aiming for annual organic growth of between 5% and 7% with significantly higher margins by 2027. The adjusted operating profit margin is to be improved by at least 1.5 percentage points by then.
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