dormakaba
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Investor Relations

Financial commentary

Sales and profitability targets achieved

Sales

The Group generated net sales of CHF 1,173.7 million in the first half of the financial year 2016/2017, an increase of 3.4%. The impact of foreign currencies on net sales for the first half-year of 2016/2017 was CHF –1.2 million. The organic sales growth was 3.4%.

Profitability

EBITDA for the reporting period increased by CHF 10.0 million and came to CHF 175.4 million. The EBITDA margin improved to 14.9%, compared to 14.6% in the same period of the previous year. The higher profitability was mainly due to a positive business development of AS AMER and AS APAC as well as to cost savings from the merger which more than compensated integration-related IT and branding costs. The impact of foreign currencies on EBITDA was CHF 0.6 million. EBIT during the period under review reached CHF 147.7 million, and the EBIT margin increased to 12.5% from 12.2% in the same period of the previous year.

Financial result, ordinary result and income taxes

dormakaba reported a net financial result of CHF –11.8 million. The financial expense of CHF 14.2 million included mainly interests for loans and pension obligations as well as foreign exchange losses. The ordinary result came to CHF 135.9 million compared to CHF 126.8 million in the​​​​​​​ previous year. A separate disclosure of an extraordinary result was limited to the financial year of the business combination of Dorma and Kaba; CHF –34.8 million in the first half of 2015/2016. This previous year figure covered exclusively integration costs relating to the merger of dormakaba Group. Income tax expense was CHF 40.1 million, representing an income tax rate of 29.5%. The income tax rate for the first half 2016/2017 was above the comparable base of the previous year (27.1%) due to higher profits in higher tax regions like the USA.

Net profit

dormakaba generated a net profit of CHF 95.8 million compared to CHF 67.1 million in the previous year. The previous year’s figure was impacted by the merger-related integration costs and related income tax benefits. Net profit after minorities was CHF 49.6 million compared to CHF 34.8 million in the same period of the previous year.

Cash flow and balance sheet

The acquisition of US based Mesker Openings Group, which took place on 12 December 2016, had an impact on the cash flow profile and the balance sheet structure. Cash generated from operations was CHF 129.3 million, and the free cash flow was CHF –83.5 million compared to CHF 140.7 million and CHF 152.5 million respectively in the previous year (“as reported”). The lower cash flow from operations is mainly a result of the requirements to support organic growth. Cash flow from financing activities was CHF 63.5 million.

dormakaba reported total assets of CHF 1,592.4 million as at the balance sheet date of 31 December 2016. Within current assets, cash and cash equivalents amount­ed to CHF 171.1 million and inventories to CHF 398.8 million, while trade receivables amounted to CHF 403.5 million. Non-current assets consisted mainly of property, plant and equipment worth CHF 345.1 million. Liabilities totaled CHF 1,018.2 million, with total financial debt coming to CHF 193.7 million. As at 31 December 2016, the net debt position was CHF 22.6 million (prior year as at 30 June 2016: net cash of CHF 159.1 million). Equity of the Group was at CHF 574.2 million, with an equity ratio of 36.0%. Equity and equity ratio declined, previous year as at 30 June 2016: 43.2%, as the Mesker Openings Group acquisition-related preliminary goodwill of CHF 113.5 million was offset against equity.

Currency rates

The average Euro exchange rate against the Swiss franc compared to the previous year went up by 0.5% from CHF 1.0788 to CHF 1.0843. The average exchange rate of the US dollar went up by 1.1% from CHF 0.9777 to CHF 0.9880.