Schindler grows despite global uncertainties

The Schindler Group published and presented their final trading and financial report for 2019 in Zurich. Thomas Oetterli (CEO) and Urs Scheidegger (CFO) also addressed the coronavirus situation in China.

In 2019, markets faced growing global political and economic uncertainty, protectionism, currency volatility, and rising labor costs, stressed Schindler at the presentation. Nevertheless, Schindler succeeded to continue growing while adapting to these changes, says the company.

50 media and press professionals were invited to this presentation and for those not able to attend a live stream was available. There was also a Q&A session for those at the meeting and anyone linked to the live streaming.

Three strategic targets

The presentation started with an introduction by Thomas Oetterli, Schindler CEO. Oetterli also commented on the possibility of 4 to 3 – a merger between Kone and ThyssenKrupp Elevator which Oetterli did feel would be programmatical for the industry as a whole if this were to go ahead. Also, it was difficult to judge what will happen to Otis now that it has been split off from UTC.

Schindler however would still be following its main objectives for further growth in 2020 and its three strategic targets:
1 – grow faster than the market,
2 – improve profitability,
3 – foster talented management and product development teams.

Performance over 2019

A video showing new products was then shown. This featured the new robotic installation tool "R.I.S.E" which Schindler have taken beyond a prototype and are now using on actual lift projects. During the presentation the Digital Twin initiative was introduced along with a Modularity program. The Schindler 9300 Premium escalator was highlighted as a key product with special mention of the A+++ energy efficiency and noise reduction components.

Urs Scheidegger, Schindler CFO, then gave some analysis of the group’s performance over 2019 and shared a number of key indicators as to the results. The strength of the Swiss Franc was highlighted as a negative influence which masked the actual performance regarding the profitability over the year.

Scheidegger showed that even with global political and economic difficulties, Schindler had continued to grow with orders up by 3.9% and revenues up by 3.6%. Operating profit reached CHF 1258 million corresponding to an EBIT margin of 11.2%.

Protection of employees’ health is paramount

The coronavirus situation in China has undoubtedly had a major impact on global trade. Due to the closure of Chinese factories and the quarantine-related interruption of the flow of people and goods, the supply of products and components had become increasingly difficult.

It was certainly difficult to predict when the global supply chain would return to normal. According to Scheidegger the protection of Schindler’s employees’ health was paramount.

The factories and offices in China were all closed and people who could work from home were doing so. All employees are still being paid, with the time out being taken as holiday leave.

John Gale

www.schindler.com

Schindler Financial Statements 2019 (PDF-File, free download)