Industry Datwyler increases operating margin with falling revenue
The Altdorf-based industrial group Datwyler generated less revenue in the first half of 2024 than in the same period of the previous year. The operating profit margin nevertheless increased thanks to optimization measures. The revenue forecast for the year as a whole is a touch more defensive.
23.07.2024, 07:28
SDA
Sales fell by 5.0 percent to CHF 572.5 million, as the sealing solutions specialist announced on Tuesday. Adjusted for currency effects, the organic decline was 2.4 percent.
The first half of 2024 was predominantly characterized by weak sales markets and a continued reduction in safety stocks among healthcare customers, according to the statement. In addition, sales of CHF 7.5 million in components for Covid vaccinations were missing compared to the same period of the previous year.
By contrast, operating profit (EBIT) improved by almost 12% to CHF 67.5 million and the corresponding margin by 1.8 percentage points to 11.8% - despite weak demand and continued underutilization at several sites, according to the statement. At the same time, net profit increased by a good 20 percent to 38.6 million.
Datwyler attributes the improvement in operating profit and margin to "the successful implementation of extensive optimization measures". "We are working consistently to further improve our commercial and operational performance and are pushing ahead with our promising innovation and growth projects in a targeted manner," the new CEO Volker Cwielong is quoted as saying in the press release.
Sales forecast becomes more defensive
Datwyler is cautious for 2024 as a whole. In the short term, it is still difficult to make reliable forecasts in most markets. Overall, the second half of the year is likely to develop "largely in line with the first half".
Specifically, Datwyler is forecasting revenue in the region of the previous year. In the spring, revenue growth in the low single-digit percentage range was still forecast. An unquantified improvement in the EBIT margin is also still expected.
Datwyler assumes, for example, that weak demand and destocking among healthcare customers will continue in the second half of the year. On the other hand, the positive business performance in the Mobility and Food & Beverage business units should continue.
