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UPDATE 1-Geberit sales and income miss forecasts as demand falls
August 12, 2014 / 8:05 AM / 3 years ago

UPDATE 1-Geberit sales and income miss forecasts as demand falls

* Geberit Q2 sales 617.9 mln sfr vs 629 mln in Reuters poll

* Net income 130.8 mln sfr vs 133 mln sfr in poll

* Says has every reason to be confident of solid FY results (Adds bullets, recasts with Q2 results)

ZURICH, Aug 12 (Reuters) - Switzerland’s Geberit AG posted second-quarter sales and net income on Tuesday that missed analysts’ estimates, as the sanitary equipment maker suffered a fall in demand linked to a downturn in the European construction industry.

Geberit’s sales rose 4.5 percent year-on-year to 617.9 million Swiss francs (680.13 million US dollar), short of analysts’ average estimate of 629 million francs in a Reuters poll.

Net income of 130.8 million francs also lagged expectations of 133 million francs.

The company said demand in Europe was falling but added that residential housing projects were partly offsetting a dearth in commercial real estate projects.

It said in a statement it expected the European downturn to “flatten out somewhat in many places during the current year” and pointed out that residential housing projects in the United States were perking up, though public construction there remained stagnant.

The company said it still expected to achieve sales growth in local currencies at the upper end of its annual average target of 4-6 percent in 2014.

Geberit also forecast its full-year earnings before interest, taxation, depreciation and amortization (EBITDA) margin to be slightly above the previous year’s level.

Geberit’s EBITDA margin for the first half of the 2014 was 28.2 percent, compared to 26.5 percent in the previous year.

Shares in Geberit were down 1.3 percent at 298.80 Swiss francs in early trade. (1 US dollar = 0.9085 Swiss franc) (Reporting by Joshua Franklin; Editing by Sophie Walker)

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