Sulzer (SUN) H2 2023 earnings summary

Executive summary

• 2023 sales grew across all three divisions and regions; EBITA margin reached 11.1%, ROCE 17.7%, and FCF CHF 301.3m, each at a 10-year or longer high.

• Strong market momentum and early benefits from Excellence initiatives supported higher profitability and cash generation.

Financial highlights

• Sales CHF 3,281.7m; order intake CHF 3,580.3m; EBITA CHF 365.6m; ONCF CHF 373.9m; FCF CHF 301.3m.

• 2023 vs 2022: sales +13.2%, order intake +13.9%, and EBITA +25.3%, adjusted for currency and acquisition/disposal effects; FCF +46.1%.

• EBIT CHF 330m and net income CHF 230m; reported comparisons rose 35.5% and 54.2%, respectively, excluding 2022 one-off impacts of CHF 147m and CHF 134m.

• FCF CHF 301m, up 46.1%; 2022 FCF was reduced by CHF 148m in one-off impacts.

Outlook and guidance

• 2024 guidance: order intake +2% to 5%, sales +6% to 9%, and operational profitability ~12%.

• Order intake expected to remain above 2022 levels, with slower development in 2024 compared with exceptionally strong Q1 2023.

• 2023 order intake and sales exceeded February 2023 guidance and landed within or at the high end of July 2023 guidance; EBITA margin was 11.1% versus July guidance of ~11%.

• Guidance carries risk that actual results may differ materially due to known or unknown risks and other factors.