Geberit posts H1 sales growth on strong volumes, price increases; outlook held

Swiss sanitary products company Geberit reported a 5.9% rise in first-half net sales, driven by strong volume growth and price increases that offset higher raw material costs and currency losses. The company's reported net sales reached 1.71 billion Swiss francs in the six months ending June 30, a 2.8% increase from 1.67 billion francs a year earlier. Adjusted for currency fluctuations, sales grew by 2.8%, highlighting a consistent trend of positive sales growth over the past nine quarters.

Geberit's second-quarter sales stood at 838 million francs, representing a 6.6% increase in Swiss francs and an 8.8% boost when adjusted for currency. This marks the ninth consecutive quarter of positive currency-adjusted sales growth, with an average increase of 5%, primarily attributable to higher sales volumes. Market-wise, Europe saw a 5.6% currency-adjusted sales growth, with Eastern Europe leading at 11.8%, followed by Switzerland at 9.7% and Italy at 6.9%.

Western Europe experienced a slight decline of 0.4%, primarily due to weakness in France and the UK/Ireland. The Middle East/Africa region saw an 18.9% increase, while the Far East/Pacific region grew by 6.5%, despite a continuing decline in the Chinese market. U.S. sales, however, fell by 5.0%, attributed to a base effect from tariff announcements made in the previous year.

By product area, currency-adjusted sales rose by 6.7% in Installation and Flushing Systems, 5.9% in Piping Systems, and 5.0% in Bathroom Systems. Operating cash flow (EBITDA) increased by 3% to 529 million francs, maintaining an EBITDA margin at 30.9%, the same as the previous year. Despite higher direct material costs, Geberit managed to maintain margins by leveraging volume growth, sales price increases, and eliminating certain one-off costs from the prior year.

Operating profit (EBIT) grew by 4% to 450 million francs, while net income increased by 7.4% to 364 million francs, resulting in an earnings per share of 11.09 francs, a 7.9% rise from the previous year.