Testing firm SGS to benefit from Trump's re-election, CEO says
Recasts with CEO comments on U.S., adds analyst comment in paragraph 9, shares in paragraph 10
By Tristan Veyet and Isabel Demetz
Nov 20 (Reuters) -Swiss testing and inspection company SGS SGSN.S is likely to benefit from Donald Trump's re-election as companies nearshoring should drive up demand for testing services in the U.S., its CEO said on Wednesday.
"We want to increase our presence in North America, which benefits from nearshoring," CEO Géraldine Picaud said in a press call in connection to SGS's capital markets event.
"To me, it is a market that is in need for ... more and more control when it comes to all the environmental testing," Picaud said, adding that because of this, she believed all the changes in politics would actually favour SGS's North American business a great deal.
SGS expects to double its sales in North America by 2027.
The Geneva-based firm also said it had agreed to buy MP Machinery, a North American nuclear testing specialist, without providing financial details of the deal.
SGS activated in the M&A space this year, acquiring nine companies in the first nine months of 2024, adding a total combined revenue of around 70 million Swiss francs annually.
The company said it was moving faster than expected with its 100 million Swiss franc ($113.2 million) cost savings plan, and added it expected to make further 50 million francs in savings from procurement initiatives by 2025.
"Overall we expect the cost reduction upgrade and additional growth colour as likely to be viewed as reassuring today," Jefferies analysts wrote in a note.
The company's shares were up 1.3% at 0832 GMT after it also confirmed its annual and mid-term targets.
($1 = 0.8834 Swiss francs)
Reporting by Tristan Veyet and Isabel Demetz in Gdansk; editing by Milla Nissi
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