SFS H1 sales miss estimates, but shares up on more positive H2 earnings outlook

Published 17/07/2025, 11:48
© Reuters.

Investing.com -- SFS Group AG (SIX:SFSN) reported first-half (H1) 2025 organic sales growth of 1.1% year-on-year, with total sales down 0.4% to CHF 1.54 billion, slightly below the consensus estimate of CHF 1.543 billion.

However, the company’s shares jumped over 4% after the print on a positive implied outlook for H2.

SFS’s core EBIT declined 7% to CHF 168 million in H1, missing the consensus forecast of CHF 176 million, while the EBIT margin fell 70 basis points to 11%, impacted by higher personnel costs and product mix.

Among divisions, Engineered Components grew 5.2% organically, supported by share gains and new product launches.

Fastening Systems declined 1%, while Distribution & Logistics fell 1.2%, though it outperformed the broader market.

The company announced a restructuring plan, including the closure of two European sites, which will remove CHF 110 million in low-margin sales and is expected to improve EBIT margins by 80 basis points by 2027.

“The one off costs will be CHF 75m of which CHF 25m cash. We have a net neutral view on the programme,” UBS analysts said.

SFS reaffirmed its full-year 2025 guidance, targeting flat core EBIT margins at 11.6% on flat total sales of CHF 3.03 billion.

The outlook implies organic growth of 1–2% and a margin improvement to around 12% in the second half.

“Ongoing market share gains and cost efficiencies should support the positive earnings growth in H2 25E. The guidance does not imply changes to consensus core earnings estimates,” UBS continued.

The bank expects a “mixed” investor reaction to the report, citing “consensus miss in H1 but the H2 25E positive earnings growth outlook.”

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