sia Abrasives reports successful 1999 business year (08/03/2000)
CHF 200 million net sales exceeded for first time, with above-average growth in EBIT
The 1999 business year proved very successful for sia Abrasives, with consolidated net sales climbing by 11.9% from CHF 182.9 million to CHF 204.7 million. This means that the anticipated 6 -10% growth forecast for 1999 in the wake of last years IPO was in fact exceeded.
In geographic terms, the Group recorded marked increases primarily in Southeast Asia and North and Latin America. In Southeast Asia, turnover swelled by 27.2% to CHF 27.9 million. In the North American region, too, turnover rose by 53% to CHF 17.4 million, while in Latin America net sales climbed to CHF 6.6 million, which was 8.4% higher than for the previous year. In Europe, the growth rate of around 8% reflected the average level over recent years. In Northern Europe and Switzerland, however, the sia Group experienced a slight fall-off during the course of 1999.
In terms of customer sectors, the body and paint shop segment boosted net sales growth by 21.5% with an increase from CHF 42.8 million (1998) to CHF 52.1 million (1999). The furnishings/interior fittings and panels segments registered growth over year-back figures of 11.4% and 12.7% respectively. Metal, on the other hand, failed to meet expectations with growth of only 4.6% owing to the launch of a new product series being postponed to business year 2000 instead of 1999 as planned.
Disproportionately high growth in operating income once again
Thanks to rigorous cost controls, the increase in earnings before interest and taxes (EBIT) rose disproportionately in comparison with net sales by some 22% compared with the previous year, from CHF 17.2 million to CHF 21.1 million. Here too, it proved possible for sia Abrasives to achieve the forecast EBIT margin of a minimum of 10% of net sales. Cash-flow from operations amounted to CHF 13.8 million. Gross investments made during the year under review came to CHF 11.3 million. Deprecations totalled CHF 6.9 million.
Net earnings for the sia Group in 1999 amounted to CHF 17.8 million and thus represented growth of some 19%. This result contains foreign exchange earnings of net CHF 1.2 million (1998: CHF - 0.7 million) and revenue from the sale of premises in Frauenfeld no longer used for production (CHF 1.0 million) and in Spain (CHF 2.9 million). Net earnings were reduced by the reversion to a 25.6% rate of taxation (previous year: 10.4%). In absolute terms, this is the equivalent of taxation on earnings of CHF 6.1 million (previous year: CHF 1.7 million).
On the basis of these gratifying results, it proved possible to enlarge the workforce by 65 employees more than 1998 to total 946 as at 31 December 1999. Average net sales per employee rose from the 1998 level of CHF 211,000 to CHF 222,000 in the year under review.
Outlook for 2000
On 20 June 2000, sia Abrasives Holding AG will be holding its first general meeting as a publicly quoted company.
The Board of Directors will be proposing to the general meeting of shareholders that a dividend of CHF 6.- per registered share should be paid. This represents a dividend payout totalling CHF 4.5 million or some 25% of consolidated net earnings for 1999.
The 2000 business year has started off well for sia Abrasives and the Group can again expect an increase in net sales of between 6% and 10% for this current year.
The largest of the sia Group companies, sia Abrasives Industries AG, can look forward to a very special jubilee when it celebrates its 125th anniversary this September.
® Correct nomenclature for sia Abrasives Holding AG
As there are other companies and organizations that use the same abbreviation as our company, we would be grateful if you could help to avoid any misunderstandings by always writing our name as follows: sia Abrasives (never just sia by itself).
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