By Swissquote Analysts
Geberit increases Dividend for 2022 despite Decline in Profit
Topic of the day
Sanitary technology group Geberit generated lower profits in fiscal year 2022 than in the previous year due to high raw material and energy prices. The dividend is nevertheless to be increased slightly. Operating profit (EBITDA) decreased by 15.0 percent to 909 million Swiss francs, falling short of the previous year's record result. The corresponding margin fell sharply by 4.1 percentage points to 26.8 percent. The main reasons for this decline were the massive increase in costs and the currency development, as the company announced on Wednesday. This had a significant negative impact on results at all levels. In the year under review, prices for raw materials had risen by almost one-fifth overall in currency-adjusted terms compared with the same period of the previous year, while the price of energy had doubled. This had resulted in additional costs totaling 244 million Swiss francs. The dividend is to be increased again by 10 centimes despite the drop in profits to 12.60 Swiss francs. This would be the twelfth dividend increase in a row.
After a weak start and a subsequent recovery Tuesday morning, the Swiss stock market retreated and stayed weak. The benchmark SMI, which advanced to a high of 11,181.68 around mid morning, ended the session with a loss of 83.17 points or 0.75% at 11,064.08, the day's low. Sika, Logitech and Sonova lost 2.6 to 2.7%. Credit Suisse, Lonza Group, Partners Group, Swiss Life Holding, UBS Group and Alcon ended lower by 1.5 to 2.3%. Roche Holding, Geberit, Givaudan, Swisscom and Swiss Re lost 0.7 to 1.2%. In the Mid Price Index, Bachem Holding tumbled nearly 9%. AMS drifted down 4.7%, while VAT Group, Zur Rose and Ems Chemie Holding lost 2.9 to 3.3%. SIG Combibloc, Galenica Sante, Kuehne & Nagel, SGS and Baloise Holding shed 1.6 to 2.3%. Dufry climbed 2.3%. Temenos Group and Georg Fischer both gained about 0.55%. On the economic front, data released by the State Secretariat for Economic Affairs showed the Swiss unemployment rate edged down to a non-seasonally adjusted 2.1% in February 2023, from 2.2% in the previous month. Meanwhile, the youth unemployment rate, which measures the number of job-seekers between 15 to 24 years old, decreased by 0.9% in February.
European stocks fell on Tuesday after U.S. Federal Reserve Chair Jerome Powell warned in his congressional testimony that the central bank will likely raise interest rates higher than previously thought to fight inflation. The pan European Stoxx 600 fell 0.77%. The U.K.'s FTSE 100 edged down 0.13%, Germany's DAX declined 0.6% and France's CAC 40 dropped 0.46%, while Switzerland's SMI drifted down 0.75%. Among other markets in Europe, Austria, Belgium, Czech Republic, Finland, Greece, Iceland, Netherlands, Norway, Poland, Portugal, Spain, Sweden and Turkiye closed weak. Ireland closed higher, while Denmark and Russia ended flat. In the UK market, Fresnillo tumbled nearly 7%. Ocado Group, Glencore, Endeavour Mining, Antofagasta, Anglo American Plc, Vodafone Group, Weir Group, British Land, Land Securities Group and Barclays lost 2 to 5%. HelloFresh shed about 2.6% after it forecast 2023 core profit below estimates. Melrose Industries rallied nearly 4%. Ashtead Group gained about 2.3% after the equipment rental firm forecast annual results ahead of its own estimates. Beazley, Flutter Entertainment, Rentokil Initial, HSBC Holdings and Astrazeneca gained 1 to 2.3%. In Paris, STMicroElectronics, ArcelorMittal, Michelin, Eurofins Scientific, BNP Paribas, Veolia, Capgemini, Saint Gobain, Alstom SA, Credit Agricole and Essilor lost 1 to 2%. Danone gained more than 1%. Thales and Sanofi both advanced nearly 1%. In the German market, Vonovia ended more than 5% down. Fresenius Medical Care drifted down 3.7%, while Puma, Zalando and Henkel lost 2.4 to 3%.
The Dow Jones Industrial Average dropped nearly 600 points Tuesday after Federal Reserve Chair Jerome Powell said the central bank would likely lift interest rates more than previously expected to fight inflation and cool down the economy. The blue-chip index fell 574.98 points, or 1.7%, to 32856.46. The S&P 500 dropped 62.05 points, or 1.5%, to 3986.37. The technology-focused Nasdaq Composite retreated 145.40 points, or 1.2%, to 11530.33. In the first of two hearings on Capitol Hill this week, Mr. Powell told the Senate Banking Committee that continued strength in hiring, spending and factory production has partly reversed softening inflation trends from late last year. "The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated," Mr. Powell said . "If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes." Federal unemployment numbers due Friday, as well as updated data on the consumer price index slated for next Tuesday, could add clarity before Fed officials' next meeting on March 21-22. Among individual stocks, Rivian Automotive fell $2.49, or 15%, to $14.64 after the electric-vehicle maker said it plans to sell $1.3 billion in convertible notes in a private offering. JetBlue slipped 24 cents, or 2.9%, $8.16 after the Justice Department sued to block its planned takeover of Spirit, which rose 77 cents, or 4.7%, to $17.13. Delta, United and other airlines also gained.
U.S. Federal Reserve Chairman Jerome Powell's hawkish appearance before the Senate Banking Committee on Tuesday is also causing selling sentiment in Asia - as it did earlier on Wall Street. Hong Kong is down the most, led by technology stocks, considered particularly sensitive to interest rates, which are among the bigger losers across the region.
The yield on two-year U.S. Treasury notes climbed to 5.011%, its highest close since 2007, from 4.892% Monday. It finished more than a percentage point above the 10-year yield, the biggest such gap since September 1981.
UBS lowers Meyer Burger target to CHF 0.61 (0.66) – Neutral
Citi changes 1&1 target to EUR 13.20 – Neutral
CS raises Forbo target to CHF 1,480 (1,270) – Neutral
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