Sika AG

Sika reported first-half sales of CHF 5.59 billion, slightly below the prior year due to a -5.5% foreign-exchange headwind of more than CHF 300 million. Organic growth was 2.9%, acquisition contribution was 1.1%, and local-currency growth was 4%; excluding China construction, organic growth was 4.4%. Material margin improved to 55.7%, up 60 basis points year over year. EBITDA was CHF 1.063 billion, up 10 basis points on margin in reported terms; EBIT also improved 10 basis points, net profit was CHF 552 million, and EPS was CHF 3.43 versus CHF 3.45 a year ago. Operating free cash flow was CHF 139.6 million. For the full year, management raised local-currency growth guidance to 3% to 6% and guided EBITDA margin to 19% to 19.5%; they also said full-year FX headwind should be about 3% to 4% and operating free cash flow should be more than 10% of net sales.

Thomas Hasler framed the quarter as evidence of Sika’s differentiation and “trust” with customers, saying the company is winning share across geographies despite muted demand. He highlighted strong EMEA growth, a Q2 rebound in the Americas, and improving trends in Asia Pacific outside China, while emphasizing that Sika can keep customers supplied even when supply chains are disrupted. His tone was confident but cautious on the second half, noting uncertainties in the Middle East, U.S. midterms, and China, and stressing that the higher full-year growth outlook is based on outperformance rather than market recovery.

Adrian Widmer said the H1 top line benefited from 2.9% organic growth and 1.1% acquisition contribution, while foreign exchange remained a major drag at -5.5% or more than CHF 300 million. He pointed to a 55.7% material margin, up 60 bps, helped by procurement scale, efficiencies, and pricing, while personnel costs fell 3% and other operating expenses rose 2.7% due largely to transportation and supply-chain costs related to the Middle East. EBITDA was CHF 1.063 billion, net profit CHF 552 million, EPS CHF 3.43, and operating free cash flow CHF 139.6 million; he said the cash profile should normalize in H2 and that full-year cash generation should exceed 10% of net sales. He also said Fast Forward is at about an 80% run rate and on track for CHF 80 million of savings in 2026, while NBCC synergies reached CHF 195 million on a trailing-12-month basis.

Analysts focused on whether the raised guidance implied conservatism or simply caution around H2 visibility. Management said they are confident in Q3 but not willing to extrapolate Q2 into Q4 because the Middle East, U.S. midterms, and China remain hard to forecast. Questions also centered on pricing versus volume, transportation costs, China, and gross margin durability; Widmer said H1 growth came from both price and volume, that transportation costs are partly fuel-related but can reverse, and that H2 material margin should be a bit lower seasonally. On China, Hasler said the restructuring and product mix changes are showing early progress, while the market is still down but less severe than last year and could benefit from future government stimulus.