Segment Access Solutions DACH5 min.
Moderate organic sales growth, lower profitability
AS DACH generated total sales of CHF 415.6 million in the first half of financial year 2019/20, representing year-on-year organic sales growth of 0.7%. EBITDA stood at CHF 70.3 million, down compared to the previous year (CHF 78.5 million). The EBITDA margin of 16.9% was below previous year’s level of 18.3% as the effects of higher sales prices, post-merger integration synergies and cost efficiencies could not offset the negative effects of labor cost inflation and lower volumes, which impacted the profitability of some of the German and Asian production plants. The segmentʼs main plants were negatively impacted by a reduction of inventories, as stock that has been built up last financial year to secure the relocation of the production of certain standard door closers from Germany to Asia has been reduced to normal level.
There was good growth compared to the prior-year period in Austria and particularly in Switzerland. Despite a stable underlying demand and a good order book, sales growth in Germany was slightly negative, mainly due to delays in the project business. However, volumes in Germany already improved at the end of the first half of 2019/20, and the business expects to return to organic growth for the financial year 2019/20 as a whole.
AS DACH expects that organic growth will accelerate in the second half of 2019/20, driven by the project business in Germany. The business has started to address the profitability issue with a new program that targets particularly its site in Ennepetal. Measures to further improve profitability have been initiated. These measures include the strengthening of management, improvement of the entire supply chain including further automatization and flexibilization of production. This includes the flexibility to convert staff from indirect to direct labor and to introduce flexible teams of production experts. Beside the measures currently still being implemented as part of the post-merger integration by the end of June 2020, a further reduction of around 100 jobs has been agreed with the work council to be implemented in 2020/21. The progression of the EBITDA margin in the second half of 2019/20 is expected to be supported by the realization of the remaining cost synergy potential of the post-merger integration in Germany, which will help to improve the overall cost base.
The segment continues to invest in the development of innovative solutions, such as the combination of its latest design-oriented sensor barriers (Argus) with biometric control capabilities, which enables access to attractive markets such as airports. In addition, the segment will further expand its digital solutions like connected products and digital platforms and ecosystems, which were showcased in February 2020 at the digitalBAU trade fair in Cologne (Germany).
Key figures – segment AS DACH
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Reporting half-year ended 31.12.2019
Reporting half-year ended 31.12.2018
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