SGS (SGSN) Q1 2025 TU earnings summary

Executive summary

• Record Q1 2025 sales of CHF 1,681 million, up 6.6% year-over-year, driven by 5.6% organic growth and contributions from eight bolt-on acquisitions.

• Growth led by Sustainability and Digital Trust services, with major contracts and certifications secured.

• Scrip dividend take-up of 63.3% redirected nearly CHF 400 million to strategic initiatives and growth opportunities.

• Strategy 2027 execution on track, with acquisitions focused on high-growth markets in North America and Europe.

• 2025 outlook confirmed, targeting 5–7% organic sales growth and at least 30 bps AOI margin improvement.

Financial highlights

• Q1 2025 sales reached CHF 1,681 million, up from CHF 1,577 million in Q1 2024.

• Organic growth contributed CHF 88 million; bolt-on acquisitions added CHF 21 million; scope effect +1.3%, forex -0.3%.

• Adjusted operating income margin targeted to improve by at least 30 basis points in 2025.

• All regions contributed to growth, with double-digit organic increases in Asia-Pacific and Latin America.

• Free cash flow and cash conversion remain key management metrics.

Outlook and guidance

• 2025 guidance confirmed: 5–7% organic growth, 1–2% bolt-on contribution, at least 30 bps AOI margin improvement, and strong free cash flow.

• Management remains confident in offsetting forex and tariff headwinds through cost-saving measures.

• Anticipates improvement in industrial, environmental, and agriculture segments in H2.