Sanitec deal dents Geberit profits

Swiss bathroom supplier Geberit has said it expects 2015 operating margins to be less than 2014.

Negative currency effects and its $1.4 billion (around £971 million) acquisition of Finland-based bath and toilet firm Sanitec in February 2015, resulted in profit hits for the company.

The company’s full-year sales increased by 24.2% to nearly SFr2.6bn (£1.7bn), which was in-line with analyst expectations of SFR2.59bn.

When adjusted for acquisition and currency effects, Geberit reported sales grew by just 2.7%. It also reported negative exchange rate effects of SFR201m from the Swiss National Bank’s decision to remove the euro-franc exchange rate cap in January 2015.

The company said its adjusted earnings margin – before tax, interest, depreciation and amortisation – for the whole year is expected to be around 26.5%, compared with 31.5% in 2014. It said volumes, product mix and lower raw material prices will have a positive effect on margins.

In a statement, Geberit said: “The margin dilution due to the integration of Sanitec and the effects of the currency rebate in Switzerland will have a negative impact in particular.”

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