Baar, Switzerland - Sealants and adhesives group Sika said it saw higher income in the second half of 2009 than in the first half-year, due to improved sales and lower costs, especially for raw materials.
Reporting its full year 2009 results, Sika said it achieved net sales of CHF 4155 million ($3928 million). Operating profit (EBIT) before restructuring amounted to CHF 400.6 million (9.6 percent of net sales: 2008 9.1 percent) while net profit before restructuring totalled CHF 269.4 million (6.5 percent of net sales: 2008 5.8 percent).
Sika said the net sales in 2009 of CHF 4155 million were 10.2 percent below the level in 2008. The decline is made up of a -3.9 percent sales decline in local currencies and a currency effect of -6.3 percent.
In local currencies, Sika points out, its sales of building and construction products declined by only 2.0 percent.
Sales into industrial manufacturing in the second half-year also benefited, said the group, from the various incentive programmes for purchase of new vehicles with low fuel consumption. This effect meant the drop in sales in local currencies of 20.1 percent after six months could be eased over the entire year to 11.3 percent, the company said.
Since the year saw up to a 30-percent slump in market volume in building and construction, and as much as 50 percent drop in sales among automobile manufacturing suppliers in industrialised nations, this "clearly indicates that Sika gained market share," the results statement notes.
In local currencies, Sika grew in India, the Middle East and Africa by 11.2 percent, and in Latin America by 8.0 percent. In the Asia/Pacific Region sales were nearly unchanged overall. In emerging markets such as China or Indonesia, Sika achieved double-digit growth rates, while sales dropped in OECD nations (Japan, Australia, New Zealand).
Sales declines in other regions were -8.8 percent in Europe North, -4.0 percent in Europe South and -7.7 percent in North America.
The overall proportion of group sales in emerging markets rose from 32 percent in 2008 to 34 percent presently, Sika said.
In terms of profit, Sika said after substantial rises in raw material costs in 2008, it benefited in 2009 as prices for raw materials fell. Gross profit rose by 3.5 percent, amounting to 55.2 percent of net sales. The company also significantly reduced personnel and other operating costs.
Operating profit before depreciation and restructuring costs improved by 1.0 percent as a proportion of net sales and before costs of restructuring improved as a proportion of net sales from 9.1 percent to 9.6 percent (CHF 400.6 million).
Sika said its restructuring measures to concentrate European production of Sikaflex sealants and adhesives and Sarnafil/Sikaplan roofing membranes gave rise to a one-time charge of CHF 56.6 million, meaning Sika achieved an operating profit of CHF 344.0 million.
For 2010, Sika said, it expects market-specific weaknesses in building and construction, with deferred investments, particularly in commercial buildings.
In industrial manufacturing, Sika anticipates a recovery of markets proceeding from their current reduced level, and assumes that the regions will continue to develop differently.
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