Geberit (GEBN) Q3 2024 earnings summary

Executive summary

• Achieved strong top and bottom-line results in Q3, with net sales up 6.2% in local currencies and EBITDA margin up 40 bps, despite wage inflation and negative currency effects.

• For the first nine months, net sales were CHF 2.4 billion, up 0.4% in CHF and 3.1% in local currencies, with stable profitability and continued investment in innovation and efficiency.

• EPS grew 3.1% in local currencies, supported by share buybacks, despite a higher tax rate due to new OECD minimum taxation in Switzerland.

• Free cash flow increased 1.2% to CHF 426 million, driven by operational performance and lower CapEx.

Financial highlights

• Q3 net sales reached CHF 762 million, up 4.7% in CHF and 6.2% in local currencies, driven by volume.

• EBITDA margin for Q3 was 31.0% (+40 bps); nine-month EBITDA margin at 31.4% (+10 bps).

• EBIT margin for nine months was 26.8%; Q3 EBIT margin improved due to lower depreciation.

• EPS at CHF 4.55 in Q3, up 8.4% in local currencies; nine-month EPS at CHF 15.13, up 3.1%.

• Free cash flow for nine months reached CHF 426 million (+1.2% year-over-year); CapEx down 19% to CHF 103 million.

Outlook and guidance

• Full-year 2024 guidance: net sales growth in local currencies of 1%-2%, EBITDA margin around 29.5%, CapEx CHF 170–180 million.

• Q4 expected to see lower benefit from material price tailwinds and a volume decline, leading to margin pressure.

• October net sales slightly below prior year; Q4 has one less working day and faces a tough comparison base.

• Building construction industry expected to decline in 2024, especially new builds, but renovations remain robust.