• Total Third-Party Sales: CHF1.5449 billion, a reduction of 2.3% versus first half 2023.

• Currency Effect on Sales Growth: Reduced by 2.4%.

• Organic Growth: Slight increase of 0.1% on a like-for-like basis.

• Operating Profit (EBIT): CHF180.8 million, with an EBIT margin of 11.7%.

• Contribution Margin: Improved to 58.6% from 57.8% in the previous year.

• Personnel Expenses: Increased to 28.1% from 26.8% due to inflationary salary adjustments.

• Net Income: Reduced by 11%, affecting earnings per share, which remained at CHF3.

• Net Debt: Slightly increased to CHF456 million from CHF445 million at year-end 2023.

• Equity Ratio: Improved to 56.1%.

• Return on Capital Employed: 20.2%.

• Return on Invested Capital: 8.7%.

• Engineered Components Sales: CHF549.9 million, an increase of 2.1% versus first half 2023.

• Fastening Systems Sales: CHF243.8 million, a reduction of 10% versus first half 2023.

• Distribution and Logistics Sales: CHF751.2 million, a reduction of 2.6% versus first half 2023.

• Cash Conversion Rate: Improved to 35.5%.

• Warning! GuruFocus has detected 7 Warning Signs with XSWX:SFSN.

Release Date: July 18, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• SFS Group AG (XSWX:SFSN) achieved a slight organic growth of 0.1% on a like-for-like basis despite challenging market conditions.

• The Engineered Components segment showed improved profitability and recorded a sales increase of 2.1% compared to the first half of 2023.

• Significant investments in key projects, such as the expansion in Nantong, China, and the acquisition of land in India, are expected to support future growth.

• The company successfully reduced CO2 emissions by increasing the share of renewable energy, demonstrating a strong commitment to ESG measures.

• The integration of a strategic partner into the logistics platform in Nuremberg contributed to a sales increase of approximately CHF50 million in the D&L segment.

Negative Points

• Total third-party sales decreased by 2.3% compared to the first half of 2023, impacted by currency effects and market challenges.

• The Fastening Systems segment experienced a significant sales reduction of 10% due to weaker demand and high inventories.

• The EBIT margin of 11.7% was slightly below expectations, influenced by uneven capacity utilization and mix effects.

• The financial result was negatively affected by the weakening of the Swiss franc, impacting the company's debt positions.

• Personnel expenses increased due to inflationary adjustments and a rise in full-time employees, affecting overall profitability.