Midyear Results 2016
Chemtech
Order intake and sales decreased compared with the same period of the previous year. Operational EBITA and operational ROSA improved. Sulzer acquired PC Cox Group Ltd. and signed a binding agreement to acquire Geka GmbH. Further, it announced the closing of its manufacturing facility in Oberwinterthur, Switzerland.
Sulzer doubles the size of its most profitable business unit
Sulzer acquired PC Cox Group Ltd. headquartered in Newbury, UK. Through the complementary acquisition, Sulzer Mixpac Systems (SMS) — a business unit of the Chemtech division — has become a leading manufacturer of dispensers for industrial applications. On July 1, Sulzer signed a binding agreement to acquire Geka GmbH and doubled the size of its most profitable business unit SMS. The transaction creates a leader in proprietary B2B mixing and applicator solutions.
Growing competition, the significant drop in the oil prices, and the strong Swiss franc have put sustained pressure on manufacturing costs in Switzerland. Therefore, Sulzer announced plans to close the manufacturing facility of its Chemtech division in Oberwinterthur, Switzerland. The company expects this restructuring to be completed in the first half of 2017.
Order intake decreased
The Chemtech division reported a decrease in order intake from the same period of the previous year. The decline mainly stems from the weak oil and gas market and a baseline effect (large order from the Middle East in 2015). The overall order intake gross margin increased. The oil and gas market continued to be challenging. Demand in the general industry market grew, mainly because order intake in the SMS business unit increased significantly. Order intake in Europe, Middle East, and Africa increased (excluding the abovementioned large order). Order intake in the Americas declined, whereas it was up from last year’s low level in Asia-Pacific.
Decrease in sales — operational EBITA and operational ROSA improved
In the first half of 2016, sales decreased compared with the same period of the previous year. The lack of upstream projects and the delay of projects to the second half of the year contributed to this development. SMS’s significant increase in sales could not offset the shrinking volumes in Separation Technology and Tower Field Services. Operational EBITA and operational ROSA improved compared with the first half of 2015.
Key figures Chemtech (January 1 – June 30)
| millions of CHF | 2016 | 2015 | Change in +/-% | +/-%1) |
| Order intake | 353.3 | 391.1 | – 9.7 | – 9.1 |
| Order intake gross margin | 38.0% | 34.2% | ||
| Order backlog as of June 30 / December 31 | 342.1 | 307.7 | 11.2 | |
| Sales | 314.9 | 338.8 | – 7.1 | – 6.7 |
| EBIT | 13.7 | 22.8 | – 39.9 | |
| opEBITA | 34.0 | 33.8 | 0.6 | 1.8 |
| opROSA | 10.8% | 10.0% | ||
| Employees (number of full-time equivalents) as of June 30 / December 31 | 3 594 | 3 539 | 1.6 |
1) Adjusted for currency effects.
If not otherwise indicated, changes compared with the previous year are based on currency-adjusted figures.
EBIT: Operating income
ROS: Return on sales (EBIT/sales)
opEBITA: Operating income before restructuring, amortization, impairments, and non-operational items
opROSA: Return on sales before restructuring, amortization, impairments, and non-operational items (opEBITA/sales)