Georg Fischer Reiterates 2015 Sales Target Helped by Pipe Unit
Georg Fischer AG (FI/N) will meet its target to increase sales by as much as 25 percent by 2015, helped by a rising order book at its Piping Systems division and further acquisitions, Chief Executive Officer Yves Serra said.
The unit has received “a lot of orders” for pipes in Germany since the government last year required the owners of schools and hospital buildings to take responsibility for water quality, Serra said. The company is seeking to raise sales from piping to as much as 45 percent of total revenue from 36 percent, he said. Fischer had sales of 3.6 billion Swiss francs ($3.9 billion) in 2012.
“We think that with the spread of infections like Legionnaires’ disease, the awareness will increasingly go up,” Serra said yesterday in an interview at the company’s headquarters in Schaffhausen, Switzerland.
The piping division has higher operating margins and more stable revenue than other units, which make lightweight metal parts for cars and cutting and drilling machines used to produce aircraft engine pieces. Long-term orders at its automotive unit will also help ensure the company hits its sales target, Serra said.
Georg Fischer’s plastic pipes help keep water clean by eliminating the risk of rust contamination, and by ensuring a steady flow through the pipe that prevents pools of stagnant water which attract bacteria, Pietro Lori, head of the piping unit, said yesterday.
Georg Fischer shares have risen 68 percent this year as investors bet on its ability to weather an industrial slowdown in Europe and the over-valued Swiss franc, which makes wage costs higher than competitors in the euro-region.
The stock traded 0.3 percent lower at 597 francs as of 12:20 p.m. in Zurich, giving the company a market value of 2.45 billion francs.
Legionnaires disease is a type of pneumonia caused by bacteria which tend to contaminate man-made water systems, and kills about 500 people in the European Union each year, according to scientific journal Eurosurveillance.
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