Geberit flags heightened geopolitical risks after steady Q1 results
Geberit Q1 2024 Financial Performance and Outlook
Geopolitical Risks Impacting Outlook
ZURICH, May 5 (Reuters) - Geberit on Tuesday said geopolitical risks have significantly increased due to the Middle East conflict, making it difficult to provide a broader economic outlook, as the plumbing supplies maker reported first quarter results in line with expectations.
Q1 Financial Results
Sales Performance
The Swiss company, which makes bathroom piping and ceramics, said its sales fell 0.7% to 873 million Swiss francs ($1.11 billion)in the three months to the end of March, in line with analyst forecasts.
Operating Cash Flow
Operating cash flow (earnings before interest, tax, depreciation and amortisation) rose 2.3% to 283 million francs, slightly ahead of 279 million francs forecast in a consensus collected by Visible Alpha.
Challenges and Economic Outlook
Uncertainties Due to Middle East Conflict
The company said the Middle East war made it difficult to give an outlook for the broader economic situation, in areas like inflation, consumer sentiment and interest rates, which are important for the construction industry overall.
"However, the global economy will be exposed to significant uncertainties overall," Geberit said. "Europe is expected to face subdued growth prospects as before."
Currency Impact
Swiss Franc Appreciation
The appreciation of the Swiss franc weighed on Geberit's results during the first quarter.
Translation Losses
The rise of the safe haven currency caused a translation loss of 35 million francs when foreign sales were converted back into Geberit's reporting currency.
Underlying Sales Growth
When this effect was removed, Geberit's sales increased by 3.4%, helped by higher sales volumes and prices.
Additional Information
($1 = 0.7847 Swiss francs)
(Reporting by John Revill, Editing by Miranda Murray)
