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Investor Relations

Letter to the Shareholders

Dear Shareholders

dormakaba generated consolidated sales of CHF 1,400.6 million in the first financial half-year as of 31 December 2017, compared with CHF 1,173.7 million a year previously, which corresponds to an increase of 19.3%. 14.6% of this growth can be attributed to the acquisitions of Mesker, Best Access Solutions, Kilargo and Skyfold, while the Group’s organic growth came to 2.9%. 1.8% of the growth is due to positive currency effects. The EBITDA margin improved from 14.9% in the prior year to 15.1%, mainly due to cost savings resulting from the merger and to positive acquisition effects. dormakaba closed the first half of 2017/18 with a consolidated net profit of CHF 113.6 million (CHF 95.8 million a year previously). Despite sales growth and slightly higher profitability, we are somewhat below our expectations for the first half of the current financial year in terms of organic sales growth. In this regard, we expect to achieve a higher result in the second half of 2017/18.

Market development

The performance of the individual segments varied in the first half of 2017/18. We recorded solid acquisition-driven and organic growth in

AS AMER, though the pace of the previous year was no longer maintained. While demand for Lodging Systems was good, demand in the Safe Locks business was below expectations, which affected profitability negatively.

We achieved very good results at AS APAC, with strong organic growth and a higher EBITDA margin. Good demand in all regional markets, the introduction of innovative new products and solutions, and higher volumes contributed to this positive development.

AS DACH achieved solid organic growth. In Germany, delays in project business resulted in lower sales despite good order intake; but this was more than offset by strong growth in Austria and growth in Switzerland. The EBITDA margin was lower than in the previous year.

AS EMEA increased its organic growth and improved profitability compared to the first half of 2016/17. Growth was driven by strong demand for Lodging Systems and Entrance Systems.

We continued to optimize our segment structure during the reporting period with a view to further improving efficiency and effectiveness. Our two smallest segments, Key Systems and Movable Walls, were brought together under one management to form the new Key & Wall Solutions segment. The two businesses have not been merged operationally and continue to be run under separate brands. The new Key & Wall Solutions segment posted solid organic growth and improved its profitability compared to the previous year.

Integration process

Completion of the remaining integration projects is focused mainly on the end of the 2017/18 financial year. We continue to work determinately on the integration to dormakaba, and we are overall confident that the integration will largely be completed as planned by the end of June 2018. An exception is our comprehensive restructuring in Germany. This is taking longer to implement than originally scheduled, though the relocation of production for certain standard products from Germany to Singapore and China is going according to plan. Overall, we expect the full impact of merger-driven synergies to be realized in the 2018/19 financial year. The integration of Best Access Solutions, Mesker, Skyfold and Kilargo, all of which we acquired after December 2016, is proceeding all in all as planned.


We strive for innovation leadership. During the period under review, we introduced innovative new products to the market such as the TS 98 XEA door closer.

In order to make the most of the opportunities that digital transformation is creating for dormakaba, we invest continuously in people, processes and systems. Over recent months we have initiated several innovation and manufacturing projects to advance the digital transformation in the areas of solution-oriented offerings and factory automation. This also includes the creation of a unit focusing on the development of digital products and solutions, and new business models they may entail. Our capacity to innovate has received outside recognition too. We are proud that dormakaba is the only company in our industry to be included in the Thomson Reuters list of “Top 100 Global Technology Leaders” in January 2018.

Portfolio management activities: acquisitions and divestments

We made several adjustments to our portfolio in the first half of the 2017/18 financial year in order to concentrate on our core business. In July 2017, we sold our low-performing business Dorma Beschlagtechnik.

This was followed in September 2017 by the sale of Chinese company GMT, due to the existing business portfolio and the prospects for profitability. We acquired Australian company Kilargo in July 2017 to strengthen our market position in the Pacific region. In the same month, we acquired Skyfold, a Canadian provider of automated vertical partition wall systems that has a strong position in North America. Both newly acquired companies, as well as the businesses acquired in North America in the previous year, made a positive contribution to the Group’s sales and operating profit during the period under review.


As in the previous year we expect a stronger business development in the second half of financial year 2017/18. Given the performance reported for the first six months, we have become a little more cautious for the organic sales growth in our outlook for the financial year 2017/18 as a whole, and we expect to achieve around 3.5%.

Our outlook for EBITDA margin remains unchanged. Despite additional integration-related costs, especially for IT, and despite the integration costs associated with acquisitions, we continue to expect a slight improvement in the EBITDA margin compared with the 2016/17 financial year. We stick to our medium-term targets.

Based on the completed merger, the ongoing integration and the Group’s operating performance, dormakaba should achieve an EBITDA margin of 18% for the first time in 2018/19. Organic sales growth should be at least 200 basis points above the GDP growth in the markets relevant to dormakaba.

Further development of management structure

Following the merger of the two smallest segments, Key Systems and Movable Walls, to form the Key & Wall Solutions segment under the leadership of Stefano Zocca, formerly Chief Operating Officer (COO) Key Systems, Christoph Jacob, the former COO of Movable Walls, stepped down from the Executive Committee and left the company. In November 2017, Chief Integration Officer Beat Malacarne announced that he would be leaving the company after completion of the integration on 30 June 2018. This will leave the Executive Committee with nine members from 1 July 2018. On behalf of the Board of Directors and Executive Committee we would like to thank Christoph Jacob and Beat Malacarne very much for their great commitment to dormakaba over many years. Both have made an important contribution to the onward development of the company in recent years, as well as helping ensure the success of the merger that created dormakaba.


We would like to thank you, our valued shareholders, for your loyalty to dormakaba. We would like to thank our customers and business partners for the trust they have placed in us, our products, solutions and services, and for the good collaboration.

We thank our employees for the great personal dedication with which they work every day for the continuing success of dormakaba.

Sincerely yours

Ulrich Graf,  Chairman of the Board of Directors
Riet Cadonau, CEO