Driven by strong organic growth of 7.4% and the first-time consolidation of Tegra Medical, SFS Group increased its sales in the 2017 financial year by 13.7% to CHF 1,632.7 million and its operating profit by 12.5%.
Strong organic growth of 7.4% fueled the positive sales developments. All segments contributed to the pleasing results. Currency movements had a marginally positive effect of 0.5% on reported sales, while changes in the scope of consolidation added a significant 5.8% to the reported sales growth.
in CHF million
|Distribution & Logistics||160.2||162.7||322.9||312.8||3.2%|
|Change in scope of consolidation||6.9%||4.8%||5.8%||1.5%|
The Engineered Components segment reported sales of CHF 925.8 million, an increase of 20.5% versus the previous year. Another significant acceleration in sales development was achieved during the second half compared to the first-half sales. This pleasing development is attributed equally to the first-time consolidation of Tegra Medical and to strong growth momentum at the Automotive and Electronics divisions. The realization of challenging new projects was a key factor behind the reported sales growth. Advance outlays associated with these projects resulted in additional costs. These outlays as well as project delays originating with customers temporarily lower operating profit margin.
The Fastening Systems segment sustained its good momentum from the first half into the second half of the year and achieved sales of CHF 384.0 million. This corresponds to a growth rate of 8.0%. In an overall strong market environment, demand was high, especially for the Construction division in Europe and North America. Thanks to the market success of innovative products, the segment expanded its market share once again. Key transformational projects are nearing completion. The related cost-savings will become visible in the coming years.
The Distribution & Logistics segment strengthened its market position thanks in particular to the execution of new customer projects. The business units tools and fastening systems showed very good growth. Segment sales grew a solid 3.2% to CHF 322.9 million. This increase is well above the growth rate of Switzerland's gross domestic product, which serves as an important benchmark. The strengthening of the euro led to a significant increase in procurement costs for third-party merchandise, but there was a time lag before the necessary price adjustments could be passed on to customers.
In the 2017 financial year, sales showed positive growth in every region. Thanks to the successful integration of Tegra Medical, the share of sales generated in the Americas rose 39.9% and amounted to CHF 281.4 million. This acquisition has altered the regional sales mix and raised the sales contribution from the Americas region to 17.2%. Significant progress towards the targeted diversification was thus made during the year under review.
In Asia, too, year-on-year sales growth was a high 16.6%, bringing full-year sales from this region to CHF 353.9 million. Growth here is primarily attributed to the Electronics division. Business trends at the other units active in Asia were also very positive.
|in CHF million||2017||2016||±PY||% share, 2017||% share, 2016|
Based on the provisional results now available, SFS Group expects its adjusted operating profit (EBITA calculated in accordance with IFRS) to increase by 12.5%. The adjusted EBITA margin is projected to be at the lower end of the given range of 14.2–15.2% due to the aforementioned extraordinary operating effects.
The detailed and audited financial accounts for the 2017 financial year, prepared in accordance with Swiss GAAP FER for the first time, will be released on 9 March 2018.