Hilti after eight months with a sharp drop in profit
The construction equipment manufacturer Hilti had to accept a significant drop in profits in the first eight months of 2022. Although sales increased, the challenging environment left its mark on profits.
From January to the end of August, Hilti increased sales by 6.1 percent to CHF 4.11 billion compared to the previous year, the manufacturer of the famous red drill said in a communiqué on Friday. Adjusted for currency effects, the group even grew by 9.1 percent.
Hilti grew particularly strongly in America, where sales increased by 15.8 percent. Europe (+7.5%), Asia/Pacific (+6.7%) and the region of Eastern Europe / Middle East / Africa (+3.0%) made underproportional contributions to the Group’s growth.
However, the winning numbers drop significantly. The operating result shrank by 36 percent to 392 million francs and the net profit by 39 percent to 286 million francs. Hilti blames a multitude of factors for the decline.
For example, “enormous” cost increases in the supply chain and Russia’s invasion of Ukraine. In addition, there would be negative currency effects and significant investments in the development of the software business.
At the same time, many sales were postponed to the last trimester due to the introduction of the new “Nuron” battery platform in Europe. However, these effects should be balanced out by the end of the year, explained Hilti.
With the introduction of “Nuron”, the results should improve significantly, the company is convinced. For the full year, Hilti expects sales growth of more than 10 percent in local currencies and the decline in operating profit will be less than 15 percent.
“This then corresponds to our profitability from 2019, i.e. before the corona crisis and software investments,” explains Hilti boss Christoph Loos. Nevertheless, the group expects the momentum in the construction industry to slow down in the coming months.