Sika Sees Sales Rising on Factory Expansion and AcquisitionsPatrick Winters
Sika AG, a Swiss maker of construction chemicals, forecast continued revenue growth this year as sales from new factories and acquisitions kick in. The stock rose the most in a month.
Chief Executive Officer Jan Jenisch said today that Sika will target sales growth of as much as 8 percent a year until 2018 after dropping a more ambitious target one year ago, citing concerns over demand in Europe. Sika’s revenue rose 9.4 percent in 2013, on a local currency basis, beating the company’s forecast of growth of as much as 7 percent.
“2013 was one of most active years for acquisitions for Sika,” Jenisch said at a conference in Zurich today. “Sika has 8 percent to 9 percent market share currently, there’s plenty of room to grow that.”
Sika, which competes with BASF SE in concrete chemicals and Henkel AG in glues for industry, opened factories in 10 countries including Iraq and Angola last year in a bid to strengthen sales as a construction slump in Europe weighed on demand for its products. The Baar, Switzerland-based manufacturer also bought five companies including the building-adhesives business of Akzo Nobel NV for 260 million euros ($357 million).
The stock rose as much as 2.3 percent, the steepest intraday gain since Feb. 6, and was trading up 2 percent at 10:20 a.m. in Zurich to 3,270 francs.
The company said today it will propose Juergen Tinggren, former chief of Swiss elevator maker Schindler Holding AG, to the board of directors. Last month, Sika promoted Adrian Widmer, formerly head of group controlling and M&A, to chief financial officer replacing Ronald Traechsel.
Full-year sales grew 6.5 percent to 5.14 billion Swiss francs ($5.8 billion), matching the average estimate of nine analysts surveyed by Bloomberg. Revenue increased 9.4 percent in local currencies. Operating profit grew 21 percent to 523.5 million francs, beating analyst estimates.