Switzerland's Geberit reports sales gain despite construction dip
Adds earnings details in paragraph 3, 4, share move in paragraph 5, analyst comment in paragraph 6
By Tristan Veyet
Oct 31 (Reuters) -Swiss plumbing materials supplier Geberit GEBN.S reported slightly higher nine-month sales on Thursday, as new products and restocking by wholesalers helped to offset the impact of weak construction activity.
Geberit's net sales in the first nine months of the year reached 2.4 billion Swiss francs ($2.77 billion), a currency-adjusted rise of 3.1% year-on-year, and its shares were up 6.47% at 0812 GMT, climbing to the top on the Swiss blue-chip index .SSMI.
Although Europe's construction industry is heading for further decline this year, with building permits falling 3% in the first half of 2024, Geberit said about 60% of its sales came in its global renovations business, noting a need for renovation works in many European countries.
It added that a shift in demand from sanitary to heating solutions had not adversely affected its sales in this division.
"Geberit recorded surprisingly strong momentum in revenues and a solid margin in the third quarter in comparison with other construction suppliers," a note by Swiss bank Zuercher Kantonalbank analysts said.
Geberit said it expected to achieve 2024 net sales growth of 1% to 2% in local currency terms, as well as an earnings before interest, taxes, depreciation and amortization (EBITDA) margin of 29.5%.
"The EBITDA margin in the fourth quarter of the year is always significantly lower than in the first three quarters, due to seasonal factors," the company said in a statement.
($1=0.8654 Swiss francs)
Reporting by Tristan Veyet in Gdansk; Editing by Clarence Fernandez and Helen Popper
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