Resilient performance in first nine months - Strategic actions to drive growth and profitabiliy

Growth in regions EMEA and Americas - Further market share gains

With five acquisitions and seven newly opened factories in the first nine months of the year, Sika made targeted investments to strengthen its global market position and increase market penetration. Even in a challenging economic environment, Sika gained further market share.  

With sales growth of 2.1% in local currencies (previous year: 9.0%), construction markets in EMEA (Europe, Middle East, Africa) – the largest and most heterogeneous region – showed a slight recovery in the reporting period. Business performance was particularly strong in countries in the Middle East and Africa, where Sika recorded double-digit growth and market share gains. The first signs of a market recovery are also evident in Eastern Europe. In Germany, Sika is well positioned to benefit from the government’s recently approved infrastructure package.

Sales in the Americas region rose by 2.9% in local currencies (previous year: 12.2%). While the business year got off to a strong start, US trade policy measures triggered some uncertainty in the market and slowed down momentum. Growth subsequently softened in the USA and Mexico, whereas performance remained solid in Latin America overall. In the US construction market, a positive development is being seen in investments in data centers as well as government-sponsored infrastructure projects. Sika manufactures nearly 100% of its products and solutions sold in the USA within the country. With its local presence and leading position in the renovation segment, Sika succeeded in outperforming the overall market in a challenging environment.

In the Asia/Pacific region, sales declined by -3.9% in local currencies in the first nine months of the year (previous year: 4.7%). This result is mainly due to the deflationary market environment in China’s construction sector, where Sika’s focus is on protecting margins and improving efficiency. Without the double-digit sales decline of the Chinese construction business, the region would have recorded around 4% growth in local currency. Market development was particularly dynamic in India and Southeast Asia as well as in the Automotive & Industry segment, where Sika was able to further expand the share of its technologies in vehicles from local and international manufacturers.

Commitment to market leadership in China

Sika remains convinced that its unique presence and commitment to innovation will allow to fully capitalize on China’s long-term opportunities driven by a maturing construction market, a leading e-mobility industry, and a growing addressable market. Sika will build on its core strengths in China, which include digital excellence, EV and battery expertise, and best-in-class end-to-end processes throughout the value chain. 

In Automotive & Industry, Sika continues to expand the share of its technologies in vehicles from both local Chinese as well as international manufacturers. Market demand remains strong with electrification in full conversion mode. Chinese automotive OEMs have become key players in the automotive industry over the last decade. Sika is well positioned to work with them in China and to support their expansion into other geographies. 

In the construction industry, Sika holds a strong position among Chinese main contractors who are expanding into Southeast Asia and beyond. The residential retail-driven business in China is facing deflationary impacts, which Sika is addressing by adapting the product mix, rightsizing the organization, and making further efficiency improvements.

Strategic actions to drive growth and profitability

Sika is making structural adjustments in ongoing weak markets, such as China, with anticipated one-off costs of CHF 80 to 100 million, incurring in 2025. The structural measures include a workforce reduction of up to 1,500 employees. These adjustments are part of an investment and efficiency program, “Fast Forward”, which builds on Sika’s leadership position as a global, integrated construction chemicals company. It is designed to accelerate innovation and growth as well as enhance customer value and improve operational excellence through digital acceleration. The program also includes investments of CHF 120 to 150 million and will drive overall annual savings of CHF 150 to 200 million. The full impact is expected in 2028.

Outlook for 2025 and medium-term targets

For 2025, Sika expects a modest increase in local currency sales, despite an overall shrinking market and challenging market conditions in China. The EBITDA margin is expected to be approximately 19% after one-off costs. Excluding these costs, Sika expects an EBITDA margin of between 19.5% and 19.8%. 

For the medium-term, Sika is confirming its Strategy 2028 target of an EBITDA margin of 20-23%. Sika is rebasing its growth guidance to 3-6% in local currencies, reflecting a revised market growth assumption over the remaining three years of the strategy period.