Looking back at the first half of 2023 for the SFS Group, the period was characterised by mixed business performance and destocking effects in the end markets. Renewed strong sales growth of 29.2% was mainly driven by the inclusion of Hoffmann. Sales amounted to CHF 1,580.7 million. At CHF 189.9 million, operating profit (EBIT) rose by 16.6% year-over-year.
While the SFS Group benefited from opportunities arising from its broad positioning across different end markets and regions, it still feels the impact of challenging regional and global developments.
Profitability was impacted by mix effects, uneven capacity utilisation from new program ramp-ups and partially increased cost basis. The Distribution & Logistics segment developed positively and contributed significantly to the increase in operating profit. All in all, the SFS Group reached an operating profit (EBIT) of CHF 189.9 million, which corresponds to strong growth of 16.6%. The EBIT margin amounted to 12.1% of net sales.
Organisational development to strengthen the customer focus
To guarantee a strong customer focus and better leverage cross-selling potentials as well as both operational and application-oriented synergies, the current Automotive and Industrial divisions are being complemented with the respective end market specific business areas of the Riveting division. This change will be implemented within the organisation as of January 1, 2024. The growth and profitability targets of the EC and FS segments will remain unchanged.
In the interests of a farsighted succession planning, the Board of Directors appointed Urs Langenauer as the future head of the expanded Automotive division. He will take over from Alfred Schneider on January 1, 2024, who will continue to support SFS in selected projects until his retirement on May 31, 2024.
To make better use of the collaboration potentials in the area of technology between the Industrial and Medical divisions, the two divisions will be merged into one division called Medical & Industrial Specials. This change will be implemented as of January 1, 2024. Walter Kobler, who had been heading up the Industrial division as well as the Medical division, will take charge of this new division. With this step, the organisational structure of the Group will become leaner.
Expectations for the 2023 financial year updated
The Group’s maximum customer focus and ongoing efforts to pursue forward-looking innovation and organisational projects continue to take top priority. We want to identify the chances and opportunities that go hand-in-hand with the current changes and systematically seize them.
SFS updates the outlook on the 2023 financial year and expects sales of CHF 3.1-3.3 billion, including the first-time consolidation of Hoffmann for the full year. This corresponds to an expected sales growth on a like-for-like basis along the mid-term guidance of 3-6%. For the SFS Group as a whole, an EBIT margin of around 12% is expected, at the lower end of the mid-term guidance of 12-15%.
The outlook is based on the assumption that there will be no significant deterioration in the underlying economic conditions or geopolitical, energy or pandemic-related restrictions.