Press Release: Sika AG: SALES EXCEED CHF 6 BILLION FOR THE FIRST TIME - STRONG GROWTH OF 8.9%

Sika AG / Sika AG: SALES EXCEED CHF 6 BILLION FOR THE FIRST TIME -

STRONG GROWTH OF 8.9%. Processed and transmitted by Nasdaq Corporate

Solutions. The issuer is solely responsible for the content of this

announcement.

-- Sales growth of 8.9% in local currencies to CHF 6.25 billion in 2017

-- Accelerated fourth-quarter growth of 12.0%

-- Growth in all regions

-- Opening of 9 factories, founding of 3 national subsidiaries, acquisition

of 7 companies

-- Disproportionately high growth in profit expected for the year as a whole

-- Outlook 2018: Sales increase of more than 10% expected

Sika proved its ability to generate strong growth once again in 2017,

increasing sales in local currencies by 8.9% to the equivalent of CHF

6.25 billion. Development in the fourth quarter was particularly dynamic,

with growth in local currencies amounting to 12.0% and organic growth

coming in at 8.5%. The positive development of business in all regions,

together with investments in new factories, the founding of further

national subsidiaries and the market launch of new products all

contributed to Sika's strong growth. A record net profit figure is

expected for the 2017 financial year.

Over the last year, Sika succeeded in increasing its sales by 8.9% in

local currencies to a total of CHF 6.25 billion, thereby significantly

exceeding the CHF 6 billion mark for the first time. The fourth quarter

was characterized by dynamic growth. All regions managed to boost sales

and gain further market share. Disproportionately high growth rates were

achieved in the USA, Mexico, Argentina, China, Southeast Asia, Pacific,

the Middle East, Eastern Europe and Africa, as well as in the automotive

area.

Paul Schuler, CEO: "We continued to successfully implement our growth

strategy in the 2017 financial year, generating an 8.9% increase in

sales. As a result, we expect to break new records for both the

operating result and net profit. With nine new factories, three further

national subsidiaries, and seven company takeovers, we have made

significant investment in growth markets as well as in growth platforms

in the form of product technologies and distribution channels. These 19

strategic investments, our pipeline with innovative quality products and

our global presence - we now have 100 national subsidiaries and more

than 200 factories - allow us to look toward the future with optimism. I

am grateful to our global workforce of more than 18,000 employees and

the management team, who have together delivered another record sales

year thanks to their loyalty, their expertise and their impressive

commitment."

GROWTH IN ALL REGIONS

In 2017, sales in the EMEA region (Europe, Middle East, Africa)

increased by 7.4% in local currencies (previous year: 4.8%). The major

EU countries with the core markets of France, Italy and the United

Kingdom, recorded strong growth rates. The Middle East, Eastern Europe

and Africa all delivered double-digit growth.

In Africa, Sika's presence was further strengthened through the founding

of a new national subsidiary in Senegal and the commencement of

operations at three new factories. In both Dar es Salaam, Tanzania, and

Douala, Cameroon, the first factories for concrete admixtures were

brought into operation, while a second factory for the local production

of mortar products was established in Luanda, Angola. In Kazakhstan,

concrete admixture and mortar production in Almaty was transferred to a

larger site. In Russia, a new production line for PVC membranes was set

up at the factory in Lobnya, near Moscow. Just recently, manufacturing

capacity was expanded at Lahore, Pakistan, with the opening of a new

factory for mortar products and concrete admixtures. A new facility for

the production of high-performance, reinforcing fibers for concrete

clients in the EMEA region commenced operations at the Troisdorf site in

Germany.

Bitbau Dörr, a leading supplier of waterproofing systems, was

acquired in Austria, while ABC Sealants, a well-known manufacturer of

sealants and adhesives for the interior finishing sector, was taken over

in Turkey. KVK Holding, which is based in the Czech capital, Prague,

also joined the Sika Group. The company is an established supplier of

waterproofing and roofing systems as well as a wide range of mortar

products.

The North America region posted the strongest growth of 18.4% (previous

year: 7.8%), of which 8.5% was generated through acquisitions. With a

sales increase of around 20%, Sika significantly boosted its business

volume in the USA, thus growing at a much faster rate than the local

construction market in 2017. Targeted investments in North America over

the last few years contributed substantially to this positive business

performance. These include the development of the sales organization,

the implementation of the growth strategy through the acquisition of

companies, and the significant expansion of the supply chain with new

factories located close to fast-growing metropolitan areas. At the end

of last year, a new factory for concrete admixtures and mortar was

opened near Houston, with a view to tapping into the huge growth

potential of the construction market in Texas and the wider south-west

of the USA.

The Sika Group's offering for concrete contractors was expanded with the

takeover of Butterfield Color Inc., a leading manufacturer of decorative

concrete floors and systems in the USA, while at the end of the year it

also acquired Emseal Joint Systems, Ltd., a high-performance supplier of

structural expansion joints.

The Latin America region increased sales by 3.2% (previous year: 5.0%).

Both Mexico and Argentina generated above-average growth. Construction

activity in this region is still subdued in the countries that are more

dependent on the raw material sector. The supply chain in Mexico, a

strongly growing market, was further expanded through investment in a

new factory for mortar products and concrete admixtures in

Coatzacoalcos. Sika's presence in Central America was also reinforced by

the foundation of a new national subsidiary in El Salvador.

The acquired brands of Grupo Industrial Alce have strengthened Sika's

presence in Mexico in respect of both major projects and local

specification capabilities. Moreover, the additional production site

close to Mexico City facilitates the rapid supply of liquid-applied and

bituminous membranes to this huge metropolis.

Sales in the Asia/Pacific region rose by 5.2% (previous year: 3.6%).

High growth rates were achieved in China, the Pacific area and the

markets of Southeast Asia, with the exception of Singapore, where the

construction economy has weakened on the back of lower subsidies for

state-funded residential construction projects.

Sika reached a major milestone in Asia: following the founding of a new

national subsidiary in Bangladesh, the Group is now represented in 100

countries worldwide.

In "Other Segments and Activities" Sika achieved a sales growth of 13.8%

(previous year: 11.6%). The automotive business, which is managed

centrally on a global basis, forms a key part of this segment. With an

organic growth of 19.3% in the fourth quarter, Sika significantly

exceeded market growth. At the year-end Faist ChemTec Group was acquired,

a leading provider of acoustic systems for the automotive industry,

which is headquartered in Worms, Germany.

OUTLOOK

For the business year 2017, operating profit (EBIT) is expected to

increase at a disproportionately high rate, reaching between CHF 880

million and 900 million.

In the business year 2018, Sika expects a sales increase of more than

10%. Volatile and rising commodity prices will continue to present a

challenge in the current year. In China, for example, access to raw

materials has been impaired by environmental constraints introduced by

the government. Operating profit (EBIT) should enjoy a disproportionate

high rise in 2018.

With investments in nine new factories, three additional national

subsidiaries and seven acquisitions, the basis for future growth has

been established. These 19 key investments, together with the

well-filled pipeline of new products and the strong sales organization,

allow the Group to look with much confidence to the future.

CONTACT

Dominik Slappnig

Corporate Communications &

Investor Relations

+41 58 436 68 21

slappnig.dominik@ch.sika.com

SIKA CORPORATE PROFILE

Sika is a specialty chemicals company with a leading position in the

development and production of systems and products for bonding, sealing,

damping, reinforcing and protection in the building sector and

automotive industry. Sika has subsidiaries in 100 countries around the

world and manufactures in over 200 factories. Its more than 18,000

employees generated annual sales of CHF 6.25 billion in 2017.

The media release can be downloaded from the following link:

Media release: http://hugin.info/100359/R/2160117/830690.pdf

This announcement is distributed by Nasdaq Corporate Solutions on behalf

of Nasdaq Corporate Solutions clients.

The issuer of this announcement warrants that they are solely

responsible for the content, accuracy and originality of the information

contained therein.

Source: Sika AG via Globenewswire

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Sika AG

Zugerstrasse 50 Baar Switzerland

WKN: 858573;ISIN: CH0000587979;

http://www.sika.com

(END) Dow Jones Newswires

January 08, 2018 23:00 ET (04:00 GMT)