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28.07.2023 07:00:27 - Solid sales and EBIT again in the first half of 2023 in a challenging environment
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Zehnder Group AG / Key word(s): Half Year Results
Solid sales and EBIT again in the first half of 2023 in a challenging environment
28-Jul-2023 / 06:59 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 LR
The issuer is solely responsible for the content of this announcement.
. Group sales increased by 2% to EUR 407.0 million; for the first time, Zehnder Group achieved 60% of total
sales in the ventilation segment
. Organic sales growth of 21% to EUR 62.9 million in North America
. Operating result (EBIT) rose by a slight 2% to EUR 37.5 million, which corresponds to an EBIT margin at
previous year's level of 9.2%
. EBIT margin of 14.7% in ventilation and 0.9% in radiators
. Cash flow from operating activities increased to EUR 22.3 million (+93%)
Graenichen (CH), 28 July 2023: The Zehnder Group (SIX: ZEHN), a leading international provider of complete solutions
for a comfortable, energy-efficient and healthy indoor climate, increased its sales by 2% to EUR 407.0 million in the
first half of 2023 (organically -1%[1]). Acquisitions from the previous year contributed 3% to sales growth. Foreign
exchange effects had a slightly negative impact of around -1% on consolidated sales. For the first time in its history,
Zehnder Group achieved 60% of total sales in the ventilation segment. Accordingly, the share of sales in the radiator
segment was 40%.
Sales in the ventilation segment increased by 12% (of which 7% was organic) to EUR 245.4 million in the first half of
2023. The most recent acquisitions contributed 6% to sales growth, while currency effects had a slightly negative
impact of -1%. The enhanced component availability led to improved delivery capability, particularly in residential
ventilation. Consequently, production volumes of ventilation units were increased, and the backlog of orders
accumulated due to a lack of components was largely reduced.
The radiator segment recorded sales of EUR 161.6 million in the first half of 2023, which corresponds to a decline in
sales of 10% (-10% organically). The sharp decline in volumes was partially offset by higher prices. Weakening
purchasing power due to increased financing costs and persistently high levels of inflation have led to a decline in
demand. This development had a negative impact on the renovation business and led to a significant overall decline in
volumes in the radiator segment.
Stable operating margin in a challenging market environment
The operating result (EBIT) in the first six months of 2023 amounted to EUR 37.5 million and was thus 2% above the
figure for the period during the previous year. The EBIT margin of 9.2% was at the same level of the previous year.
Cost increases due to higher levels of inflation were largely passed on to customers. At the same time, Zehnder Group
is pursuing a proactive pricing policy and differentiated cost management in this challenging market environment. In
this way, it was possible to implement cost reductions and efficiency improvements in many areas.
In the ventilation segment, the EBIT rose to EUR 36.1 million in the first half of 2023 (previous year: EUR 29.1
million). This corresponds to an increase of 24% compared to the previous year. The EBIT margin increased by 1.5
percentage points to 14.7%. The gradual resolution of global supply problems and the associated improvement in delivery
capability had a positive impact on profitability - as did the cost-related price increases.
In the radiator segment, the EBIT fell to EUR 1.4 million in the first half of 2023 (previous year: EUR 7.8 million).
The EBIT margin thus decreased to 0.9% (previous year: 4.4%). This was mainly due to the decline in order volumes in
Europe and China in view of the difficult economic environment and the associated lower production capacity
utilisation. Furthermore, the challenging climate ceilings business continued to weigh on earnings. Targeted
cost-saving measures were implemented consistently in the radiator segment. These resulted in restructuring costs of
1.7 Mio. EUR in the first half of the year.
Increased cash flow from operating activities
Cash flow from operating activities increased to EUR 22.3 million (previous year: EUR 11.6 million) in the first half
of 2023. The increase is mainly due to the lower build-up of trade receivables compared with the previous year's
period. At the same time, Zehnder Group repurchased its own shares and paid dividends for the 2022 financial year. Net
liquidity[2] amounted to EUR 24.3 million at the end of June 2023 (previous year: EUR 23.3 million). Equity was at EUR
336.0 million (previous year: EUR 327.7 million), corresponding to a continued high equity ratio of 62% (previous year:
58%).
Outlook 2023 and confirmed medium-term targets
As already announced in the last ad hoc release of 20 July 2023, due to the current economic situation, Zehnder Group
expects that high levels of inflation and rising interest rates will continue to affect the number of planning permits
granted for new buildings and renovation projects for customers. It is currently difficult to gauge when the new
building and renovation business will recover. Against this background, Zehnder Group continues to expect a challenging
market development. Consequently, Zehnder Group expects sales for the full year 2023 between EUR 780 million and EUR
820 million, and an EBIT margin of around 8% of sales.
In the long term, growth prospects remain positive, particularly in the ventilation segment. New building regulations
for better insulated buildings, the increasing demand for energy-saving and efficient climate control solutions, and
the desire for healthy indoor air quality, together with the still low penetration rates in various countries, are
fueling growth - especially in the ventilation segment. Therefore, the medium-term targets of average annual sales
growth of 5% and an EBIT margin of 9% to 11% remain unchanged.
The complete Six-month report 2023 is available on our website at:
www.zehndergroup.com/en/investor-relations/reports-and-presentations
[1] For alternative performance measures, please refer to the Six-month Report 2023.
[2] For alternative performance measures, please refer to the Six-month Report 2023.
Next dates to note
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Contact
René Grieder Member of the Group Executive Committee, CFO Zehnder Group AG, 5722 Gränichen (Switzerland) T +41 62 855 15 21, rene.grieder@zehndergroup.com Alexander Kamb Senior Manager Investor Relations & Communications Zehnder Group AG, 5722 Gränichen (CH) T +41 62 855 15 36, alexander.kamb@zehndergroup.com This media release is published in German and English. The German version is binding. For further information about the Zehnder Group, please visit www.zehndergroup.com.
Company profile
The Zehnder Group provides worldwide leading solutions for a comfortable, energy-efficient and healthy indoor climate. The products and services of the Group include heating, cooling, indoor ventilation and air cleaning. The Group develops and manufactures its products at its own factories in Europe, China and North America. In the financial year of 2022, the Zehnder Group had about 4000 employees and achieved sales of EUR 812 million. The company is listed on the SIX Swiss Exchange (symbol: ZEHN, number: 27 653 461). The unlisted registered shares B are held directly or indirectly by the Zehnder family and persons closely associated with them.
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End of Inside Information
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Moortalstrasse 1
5722 Gränichen
Switzerland
End of Announcement EQS News Service
===
1690499 28-Jul-2023 CET/CEST
Image link: https://eqs-cockpit.com/cgi-bin/fncls.ssp?fn=show_t_gif&application_id=1690499&application_name=news
END) Dow Jones Newswires
July 28, 2023 01:00 ET (05:00 GMT)
Zehnder Group AG / Key word(s): Half Year Results
Solid sales and EBIT again in the first half of 2023 in a challenging environment
28-Jul-2023 / 06:59 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 LR
The issuer is solely responsible for the content of this announcement.
. Group sales increased by 2% to EUR 407.0 million; for the first time, Zehnder Group achieved 60% of total
sales in the ventilation segment
. Organic sales growth of 21% to EUR 62.9 million in North America
. Operating result (EBIT) rose by a slight 2% to EUR 37.5 million, which corresponds to an EBIT margin at
previous year's level of 9.2%
. EBIT margin of 14.7% in ventilation and 0.9% in radiators
. Cash flow from operating activities increased to EUR 22.3 million (+93%)
Graenichen (CH), 28 July 2023: The Zehnder Group (SIX: ZEHN), a leading international provider of complete solutions
for a comfortable, energy-efficient and healthy indoor climate, increased its sales by 2% to EUR 407.0 million in the
first half of 2023 (organically -1%[1]). Acquisitions from the previous year contributed 3% to sales growth. Foreign
exchange effects had a slightly negative impact of around -1% on consolidated sales. For the first time in its history,
Zehnder Group achieved 60% of total sales in the ventilation segment. Accordingly, the share of sales in the radiator
segment was 40%.
Sales in the ventilation segment increased by 12% (of which 7% was organic) to EUR 245.4 million in the first half of
2023. The most recent acquisitions contributed 6% to sales growth, while currency effects had a slightly negative
impact of -1%. The enhanced component availability led to improved delivery capability, particularly in residential
ventilation. Consequently, production volumes of ventilation units were increased, and the backlog of orders
accumulated due to a lack of components was largely reduced.
The radiator segment recorded sales of EUR 161.6 million in the first half of 2023, which corresponds to a decline in
sales of 10% (-10% organically). The sharp decline in volumes was partially offset by higher prices. Weakening
purchasing power due to increased financing costs and persistently high levels of inflation have led to a decline in
demand. This development had a negative impact on the renovation business and led to a significant overall decline in
volumes in the radiator segment.
Stable operating margin in a challenging market environment
The operating result (EBIT) in the first six months of 2023 amounted to EUR 37.5 million and was thus 2% above the
figure for the period during the previous year. The EBIT margin of 9.2% was at the same level of the previous year.
Cost increases due to higher levels of inflation were largely passed on to customers. At the same time, Zehnder Group
is pursuing a proactive pricing policy and differentiated cost management in this challenging market environment. In
this way, it was possible to implement cost reductions and efficiency improvements in many areas.
In the ventilation segment, the EBIT rose to EUR 36.1 million in the first half of 2023 (previous year: EUR 29.1
million). This corresponds to an increase of 24% compared to the previous year. The EBIT margin increased by 1.5
percentage points to 14.7%. The gradual resolution of global supply problems and the associated improvement in delivery
capability had a positive impact on profitability - as did the cost-related price increases.
In the radiator segment, the EBIT fell to EUR 1.4 million in the first half of 2023 (previous year: EUR 7.8 million).
The EBIT margin thus decreased to 0.9% (previous year: 4.4%). This was mainly due to the decline in order volumes in
Europe and China in view of the difficult economic environment and the associated lower production capacity
utilisation. Furthermore, the challenging climate ceilings business continued to weigh on earnings. Targeted
cost-saving measures were implemented consistently in the radiator segment. These resulted in restructuring costs of
1.7 Mio. EUR in the first half of the year.
Increased cash flow from operating activities
Cash flow from operating activities increased to EUR 22.3 million (previous year: EUR 11.6 million) in the first half
of 2023. The increase is mainly due to the lower build-up of trade receivables compared with the previous year's
period. At the same time, Zehnder Group repurchased its own shares and paid dividends for the 2022 financial year. Net
liquidity[2] amounted to EUR 24.3 million at the end of June 2023 (previous year: EUR 23.3 million). Equity was at EUR
336.0 million (previous year: EUR 327.7 million), corresponding to a continued high equity ratio of 62% (previous year:
58%).
Outlook 2023 and confirmed medium-term targets
As already announced in the last ad hoc release of 20 July 2023, due to the current economic situation, Zehnder Group
expects that high levels of inflation and rising interest rates will continue to affect the number of planning permits
granted for new buildings and renovation projects for customers. It is currently difficult to gauge when the new
building and renovation business will recover. Against this background, Zehnder Group continues to expect a challenging
market development. Consequently, Zehnder Group expects sales for the full year 2023 between EUR 780 million and EUR
820 million, and an EBIT margin of around 8% of sales.
In the long term, growth prospects remain positive, particularly in the ventilation segment. New building regulations
for better insulated buildings, the increasing demand for energy-saving and efficient climate control solutions, and
the desire for healthy indoor air quality, together with the still low penetration rates in various countries, are
fueling growth - especially in the ventilation segment. Therefore, the medium-term targets of average annual sales
growth of 5% and an EBIT margin of 9% to 11% remain unchanged.
The complete Six-month report 2023 is available on our website at:
www.zehndergroup.com/en/investor-relations/reports-and-presentations
[1] For alternative performance measures, please refer to the Six-month Report 2023.
[2] For alternative performance measures, please refer to the Six-month Report 2023.
Next dates to note
Sales announcement 2023 19 January 2024 Annual Report 2023 and Media/Analyst Conference 2024 28 February 2024 Annual General Meeting 2024 11 April 2024 Six-month Report 2024 26 July 2024
===
Contact
René Grieder Member of the Group Executive Committee, CFO Zehnder Group AG, 5722 Gränichen (Switzerland) T +41 62 855 15 21, rene.grieder@zehndergroup.com Alexander Kamb Senior Manager Investor Relations & Communications Zehnder Group AG, 5722 Gränichen (CH) T +41 62 855 15 36, alexander.kamb@zehndergroup.com This media release is published in German and English. The German version is binding. For further information about the Zehnder Group, please visit www.zehndergroup.com.
Company profile
The Zehnder Group provides worldwide leading solutions for a comfortable, energy-efficient and healthy indoor climate. The products and services of the Group include heating, cooling, indoor ventilation and air cleaning. The Group develops and manufactures its products at its own factories in Europe, China and North America. In the financial year of 2022, the Zehnder Group had about 4000 employees and achieved sales of EUR 812 million. The company is listed on the SIX Swiss Exchange (symbol: ZEHN, number: 27 653 461). The unlisted registered shares B are held directly or indirectly by the Zehnder family and persons closely associated with them.
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End of Inside Information
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Language: English Company: Zehnder Group AG
Moortalstrasse 1
5722 Gränichen
Switzerland
Phone: +41 62 855 15 21 E-mail: investor-relations@zehndergroup.com Internet: www.zehndergroup.com ISIN: CH0276534614 Listed: SIX Swiss Exchange EQS News ID: 1690499
End of Announcement EQS News Service
===
1690499 28-Jul-2023 CET/CEST
Image link: https://eqs-cockpit.com/cgi-bin/fncls.ssp?fn=show_t_gif&application_id=1690499&application_name=news
END) Dow Jones Newswires
July 28, 2023 01:00 ET (05:00 GMT)
