(Reuters) - Sika AG’s (SIKA.S) nine-month profit beat expectations boosted by a 30 percent jump in its Global Business segment and the Swiss construction chemicals maker on Thursday confirmed its target of increasing sales by more than 10 percent this year.
Sika, which defeated a hostile takeover approach from France’s Saint-Gobain (SGOB.PA) earlier this year, said it still expected double-digit growth in operating profit and net profit for the full year.
However, volatile and rising raw material prices continue to be challenging for the company, Sika said.
Net profit rose 10.5 percent to 527.7 million Swiss francs for the nine months ended September, beating forecasts of 511 million Swiss francs in a Reuters poll of analysts.
Sales rose 14.1 percent to 5.32 billion Swiss francs for the period, also ahead of expectations, and Sika said it was on track to reach sales of more than 7 billion Swiss francs ($7.03 billion) for the year.
“A combination of price adjustments and further volume growth with disproportionately low cost rises partly made up for higher raw material prices and exceptional expenses incurred in connection with the integration of acquired companies,” the company said in a statement.
Sika, whose products are used to boost the waterproofing qualities of roofs and floorings as well as adhesives in the automotive industry, said operating profit for the period was hurt by a charge of 23 million Swiss francs in relation to the agreement reached with Saint-Gobain.
To reach its goals, Sika has said it would open at least eight new factories this year and establish more national subsidiaries.
As part of these plans, the company has already opened a new production plant near Yekaterinburg in Russia and two further plants in Kazakhstan.
($1 = 0.9959 Swiss francs)
Reporting by Reporting by John Revill in Zurich and Bhargav Acharya in Bengaluru; Editing by Gopakumar Warrier