ZURICH:Swiss sanitary equipment maker Geberit AG expects 2015 operating margins below those of a year ago, it said in a statement on Wednesday, as the company's profitability took a hit from an acquisition and negative currency effects.
The company reported full-year sales increased by 24.2 percent to nearly 2.6 billion Swiss francs ($2.59 billion), in line with analyst expectations of 2.59 billion francs, as the company consolidated revenue from Sanitec, a Nordic ceramics maker it bought in 2014.
Adjusted for acquisition and currency effects, however, sales grew by just 2.7 percent, Geberit said, adding it had negative exchange rate effects of 201 million francs from the Swiss National Bank's decision to remove the euro-franc exchange rate cap a year ago.
For the full year, the adjusted earnings before interest, taxes, depreciation and amortization margin is expected to be around 26.5 percent, it said, adding volumes, product mix and lower raw material prices will have positive effect on margins.
However, "the margin dilution due to the integration of Sanitec and the effects of the currency rebate in Switzerland will have a negative impact in particular," Geberit said in a statement.
EBIDTA margin for full year 2014 stood at 27.3 percent.
Geberit spent about $1.4 billion in 2014 on Sanitec as the Swiss company sought to expand its range of bathroom products including toilets and bidets. Costs related to the acquisition, the strong Swiss franc, and what the Jona-based company called a "challenging environment in the construction industry" dragged earnings down.
It plans to release full financial statements for 2015 in March.
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