SIKA HAS RECORD SALES FOR 2021 – GROWTH OF 17.1%

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Ad hoc announcement in accordance with Article 53 of the SIX Exchange Regulation listing rules

SIKA HAS RECORD SALES FOR 2021 – GROWTH FROM 17.1%

  • Sales increase by 17.1% in local currencies – sales in 2021 CHF 9.24 billion (+17.3% in CHF)
  • Additional growth platforms created through seven acquisitions: Kreps (Russia), DriTac (USA), BR Massa (Brazil), Hamatite (Japan), American Hydrotech (USA), Bexel (Mexico) and Landun (China)
  • Signing of the takeover agreement for the MBCC Group – closing planned for the second half of 2022
  • Expansion of the production sites in Stockholm (Sweden) and Doha (Qatar), Installation new production sites in Jiaxing City (China) and Pune (India), establishment of a new one National company in Ghana
  • Disproportionate increase in EBIT and EBIT margin of 15% expected for 2021
  • Confirmation of the strategic goals for 2023 for sustainable, profitable growth

Sika held up well in a challenging environment in 2021 and once again demonstrated the strengths of its business model. Despite the ongoing COVID-19 pandemic and bottlenecks in raw material procurement, sales rose significantly to a record value of CHF 9.24 billion, which corresponds to growth of 17.1% in local currencies. The currency effect was 0.2%. The acquisition effect was 2.0% and organic growth was 15.1%. Compared to the same period in 2019, organic growth was 11.9%.

Thomas Hasler, Chief Executive Officer: “2021 was expected to be a challenging year and turned out to be very successful for Sika. We benefit from a number of growth platforms and are ideally positioned to be successful in the long term. Thanks to our innovative technologies, we are the preferred partner for many customers in the construction and industrial sectors. We have solutions for all development stages in home improvement stores and government-funded investment programs running into billions will give our business further impetus. In addition, we make targeted use of the megatrends that are moving our key markets. The need for sustainable solutions is great. Our products and services enable our customers to achieve their ambitious sustainability goals. “

UPDATE ON MBCC ACQUISITION
In November 2021, Sika signed a binding agreement to acquire the MBCC Group (formerly BASF Construction Chemicals). With sales of CHF 2.9 billion, the MBCC Group is one of the world’s leading providers of construction chemicals. This acquisition will complement and expand Sika’s range of products and solutions in four of five core technologies and seven of eight Sika target markets, while at the same time further strengthening the company’s geographic presence. This transaction creates an important player who is committed to more sustainability.

The market for construction chemical products and solutions is expected to grow to around CHF 80 billion by 2023 and, due to its high degree of fragmentation, will continue to offer significant growth opportunities even after the takeover of MBCC by Sika. MBCC generates around 53% of sales in the building systems sector and the remaining 47% in the concrete admixtures sector. The takeover is subject to official approval. Sika is confident that it will obtain all necessary permits in good time and will work closely with the authorities. The acquisition is scheduled to be completed in the second half of 2022.

MARKET SHARE GAINS IN ALL REGIONS IN 2021
In an environment characterized by several temporary lockdowns, Sika grew faster than the market in all regions in 2021. The distribution business also recorded significant growth in all regions.

the EMEA region (Europe, Middle East, Africa) recorded an increase in sales in local currencies of 16.1% (previous year: 4.4%). As in 2020, growth in the distribution and refurbishment business exceeded growth in the other business areas. Almost all countries in the region achieved double-digit growth rates. In addition to the countries of the Middle East, Eastern Europe including Russia, Great Britain and the countries in Africa also benefited from a surge in growth. In general, purchases of Sika product solutions via e-commerce platforms increased at an above-average rate.

In the reporting period, Sika acquired Kreps LLC, a leading manufacturer of mortar products in Russia, thereby further expanding both its existing product portfolio and its geographic presence.

the America region recorded growth in local currencies of 21.0% (previous year: 1.0%). In the USA, Sika has clearly gained momentum. The growth was mainly driven by major renovation projects and new construction projects in the area of ​​distribution and data centers. Strong growth rates were achieved in Mexico, Colombia, Brazil, Peru and Chile in particular. In the Americas region, the strategic focus of business activities on large cities and metropolitan regions paid off, as did the concentration on large infrastructure projects and the targeted realization of cross-selling potential.

During the reporting period, Sika acquired DriTac, a US company with a strong market position in the field of wood flooring. In addition, BR Massa, a manufacturer of mortar products in Brazil, was brought into the Sika Group. Thanks to this acquisition, Sika improved its position in one of the leading economic regions in Brazil and expanded its production capacities.

In July the company acquired American Hydrotech Inc. in the USA and its Canadian subsidiary Hydrotech Membrane Corporation. Hydrotech is an established manufacturer of liquid membranes and offers comprehensive solutions for roofing and waterproofing. In the rapidly growing segment of green roof systems, it is the clear market leader in North America.

In addition, Sika acquired the family company Bexel Internacional SA de CV, a leading manufacturer of tile adhesives and stucco work in Mexico. With this acquisition, Sika is expanding its position in the rapidly growing Mexican market for mortar products and significantly increasing its production capacity with five strategically positioned production sites.

Sales in local currencies in the Asian Pacific region increased by 19.4% (previous year: 12.6%). China in particular benefited last year from the sustained strong growth dynamic with double-digit organic growth rates and successfully expanded its infrastructure and distribution business. India continued to develop dynamically, while the countries in Southeast Asia slowly recovered from the severe lockdowns in the last quarter of the year. The trend in Japan remains challenging. Investment activity in the country’s construction market remains subdued.

In the reporting period, Sika acquired Hamatite, the adhesives division of Yokohama Rubber Co., Ltd. Hamatite is a market leader in Japan and offers adhesives and sealants for the automotive and construction industries. The acquisition significantly improves Sika’s position in the Japanese market and gives it greater access to all major Japanese automobile manufacturers and a wider range of sealants and adhesives for the Japanese construction sector.

In China, Sika acquired Shenzhen Landun Holding Co., Ltd., a manufacturer of a comprehensive range of waterproofing products and technologies. The company operates two state-of-the-art manufacturing facilities that manufacture a full range of membranes and coatings for various sealing applications and primarily serve infrastructure and commercial projects.

in the Global business segment, Sika achieved growth in local currencies of 4.3% (previous year: –11.4%). The automotive industry had major bottlenecks in the supply chain for electronic components in the past fiscal year. While the forecasts at the beginning of the year assumed a strong recovery in new vehicle production compared to the previous year, a significant decline was recorded in the second half of the year due to the lack of availability of semiconductors. Nevertheless, Sika expects further growth impulses from the megatrends of modern automobile production: electromobility and lightweight construction. In particular, the transition from the classic drive to electromobility picked up speed during the pandemic and is benefiting from various government funding programs in several countries.

OUTLOOK
Sika confirms its strategic goals for 2023. The company’s focus remains on long-term success and profitable growth. With a focus on the six strategic pillars – market penetration, innovation, operational efficiency, acquisitions, strong corporate values ​​and sustainability – Sika is aiming for annual growth of 6% –8% in local currencies until 2023. the company is aiming for a higher EBIT margin of 15-18%. Projects in the areas of operations, logistics, procurement and product formulation should lead to an annual improvement in operating costs of 0.5% of sales.

For the 2021 financial year, Sika expects a disproportionate increase in EBIT and an EBIT margin of 15%.

FINANCIAL CALENDAR

Extraordinary General Assembly Tuesday, January 25, 2022
Media conference / analyst presentation
to the annual results 2021
Friday February 18, 2022
Net sales first quarter 2022 Tuesday April 12, 2022
54th Annual General Meeting Tuesday April 12, 2022
Semi-annual report 2022 Friday July 22, 2022
Results for the first nine months of 2022 Friday October 21, 2022
Net sales 2022 Wednesday January 11, 2023

CONTACT
Dominik Slappnig
Corporate Communication &
Investor Relations
+41 58 436 68 21
[email protected]

SIKA AG COMPANY PROFILE
Sika is a specialty chemicals company with a leading position in the development and production of systems and products for bonding, sealing, damping, reinforcing and protecting in the construction sector and in the automotive industry. Sika has subsidiaries in 101 countries around the world and produces in over 300 factories. The 25,000 employees generated annual sales of 9.24 billion francs in 2021.

The press release can be downloaded from the following link:
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