Sika posts record sales in 2023
Sika reports record sales of CHF11.24bn in 2023, up 7.1 per cent YoY in Swiss franc terms and 14.5 per cent in local currency terms. There was a high negative foreign currency effect of -7.4 per cent due to the sharp appreciation of the Swiss franc.
Thomas Hasler, Sika's CEO, said: “Sika has once again proved its resilience over the past 12 months. Thanks to our well-functioning business model, our high level of innovation, and the strong commitment of our 33,000 employees around the world, we have continued to grow substantially and gained market share in what has been a challenging year. We are benefiting from high customer demand from the major growth trends such as sustainability, urbanisation, and automation. With our Strategy 2028, our geographical footprint, and our leading technologies, we are ideally positioned to continue to achieve sustainable growth in the coming years and create added value for all our stakeholders.”
Europe, Middle East and Africa
The Europe, Middle East, Africa (EMEA) region reported a sales increase in local currencies of 14.8 per cent (previous year: 8.3 per cent). The countries of the Middle East and Africa recorded strong growth rates, while France, Spain, and Portugal likewise developed positively. Sika benefited from economic subsidy programsme and from investments aimed at saving energy in buildings as well as the booming area of e-mobility. Once again, business activity was subdued in Germany, Austria, and northern Europe. The positive trend of increased infrastructure and commercial construction projects in the EMEA region generally continued in the fourth quarter. The distribution business also recorded slight growth compared to 2022.
Sika made further investments in the EMEA region. These include a 30 per cent stake in Concria Oy, a Finnish start-up which is developing innovative solutions for cementitious floors that provide a wide range of advantages for construction companies, architects, and building owners. Sika’s global network and the complementary product portfolio provides an attractive growth platform for both companies.
In addition to this, Sika commissioned a new production facility for shotcrete accelerators in Kirchberg at the end of the reporting year, thereby investing in the expansion of manufacturing capacities in its home market Switzerland. This high-performance technology is used in tunnelling in particular, as well as in excavation stabilisation.
Americas
The Americas region achieved a 14.9 per cent increase in sales in local currencies (previous year: 27.5 per cent). Rising rates of inflation, high interest rates and an increasing shortage of specialised labour weighed on construction activity in many of the region’s markets, with negative repercussions for the wider construction economy. The growth in the region in 2023 is attributable to the MBCC acquisition. Generally-speaking, the US construction economy benefitted from infrastructure projects, supported by state subsidy programmes and projects in the context of reshoring production facilities to the USA. Latin America also contributed to the rise in sales with solid growth.
In July of last year, Sika completed the takeover of Thiessen Team USA, a manufacturer of shotcrete and mortar products for the US mining sector. This company supplies mining companies in the west of the USA, which among other things supply the growing electro-mobility industry with critical minerals. The takeover offers significant cross-selling potential and strengthens Sika’s position in the US mining sector.
Investments were also made in the expansion of manufacturing capacities at the Sealy site in the US state of Texas, while production was increased in the USA and Canada due to rising demand for concrete admixtures.
Asia-Pacific
Sales in the Asia/Pacific region rose by 15.2 per cent in local currencies (previous year: 14.8 per cent). In China Sika recorded double-digit growth in its distribution business, while project business declined slightly. Sales in Japan increased and double-digit growth rates were achieved in the growth market of India. Business in Indonesia, Thailand, and the Philippines was characterised by increasing positive momentum.
In June Sika opened a new factory in Kharagpur in the east of India, thereby expanding its production capacity in this densely populated country that represents an important market for the future. The factory will produce mortar products, concrete admixtures, and shotcrete accelerators for customers in the West Bengal region, which is home to more than 100m people.
Moreover, Sika opened a state-of-the-art Technology Center in Suzhou, China, in the fourth quarter. The primary focus of activities is on the development of sustainable and high-performance technologies with which Sika makes a key contribution to the transformation of the construction and automotive industries. In the future, the new Technology Center – the second-largest in the Sika Group – will be used to focus even more on developing products and solutions tailored for the local market.
Global Business segment
In the Global Business segment, Sika achieved growth in local currencies of 10 per cent (previous year: 22.2 per cent). This increase is primarily due to robust demand for new vehicles, particularly electric vehicles, along with the normalisation of supply chains. The automotive sector strike in the USA in the final quarter of fiscal 2023 had a negative impact on sales, as did the weak demand in business not related to the automotive industry in this segment.
Sika is continually expanding its range of innovative solutions for battery systems. These include, for example, heat-conducting adhesives for the latest generation of battery-driven electric vehicles. Sika received a record number of new orders in the automotive business in the 2023 reporting year. The supply orders acquired will generate sales in the medium term and will ensure that the automotive business continues to perform well.
