Schindler Holding AG: Positive Growth Outlook and Strategic Priorities
2023-07-25
The Q2 2023 Earnings Conference Call for Schindler Holding AG Bearer Participation Certificates (SHLAF) was held on July 21, 2023. The meeting featured presentations from the company's Chairman and CEO, Silvio Napoli, and CFO, Carla De Geyseleer. They discussed the highlights of the first six months of the year, market updates, performance updates, and financial results.
During the call, management acknowledged the uncertain market outlook, with declines in the Americas and China. However, they also noted pockets of continued growth in Asia and the Middle East/North Africa. In Europe, there was strong demand for new apartments and dwellings, although developers were hesitant to invest. Overall, the market remained strong for modernization, with robust demand and favorable pricing development across all regions.
The key drivers of the business, as highlighted by management, included profitability, modernization, material costs, pricing discipline, efficiency, and labor inflation. These factors play a crucial role in shaping the company's performance and strategic priorities.
While the company's plans for product/service expansion were not explicitly mentioned, the CEO acknowledged the need for modernization and growth in the EMEA and China markets. This indicates a potential focus on improving product offerings and investing in bringing new products to the market. However, specific details about the company's plans for product/service expansion were not provided in the given text.
The company's outlook for the year remains positive, with expected growth in revenue and net profit compared to the previous year. They anticipate a growth rate between 5% and 8% in local currencies for 2023. Additionally, the company aims to achieve a net profit increase between CHF860 million and CHF900 million, representing a growth rate between 31% and 37% compared to 2022. To maintain this positive trajectory, the company plans to execute their strategic priorities with discipline, ensuring a favorable adjusted EBIT margin.
Schindler Holding AG has made significant progress on its strategic initiatives. They have implemented measures to improve performance and have sustained this improvement over the last 12 months. Despite foreign exchange pressure, the company has been able to drive growth in revenue and EBITDA. Pricing and supply chain stabilization were highlighted as key elements contributing to the company's performance. Positive improvements in pricing since Q2 2022 and addressing supply chain issues have resulted in improved on-time delivery performance. The order intake margins have roughly doubled between H1 2021 and H1 2023, reflecting the positive impact of these strategic initiatives.
In conclusion, Schindler Holding AG's Q2 2023 Earnings Conference Call provided insights into the company's performance and market outlook. Despite uncertainties in certain regions, the company remains optimistic about its growth prospects. With a focus on profitability, modernization, and strategic priorities, Schindler Holding AG aims to continue its positive trajectory and deliver strong financial results.