Full Year 2025 SGS SA Earnings Call Transcript
Key Points
- SGS AG (SGSOF) achieved its best financial performance ever in 2025, with record-high sales, adjusted operating income, and free cash flow.
- The company reported a strong organic growth of 5.6%, despite adverse forex impacts.
- SGS AG (SGSOF) successfully closed the acquisition of Applied Technical Services, contributing to an additional 5% sales growth from acquisitions.
- The company achieved significant milestones in its Strategy 27, including launching offerings in sustainability and digital trust, leading to double-digit organic growth.
- SGS AG (SGSOF) maintained a strong cash conversion rate of 57% and proposed an attractive dividend of CHF3.20 per share.
- The company faced a strong adverse forex impact, reducing reported sales growth to 2.2%.
- Natural Resources growth was impacted by political uncertainty in the Middle East and a poor crop in Europe.
- Consulting within Business Assurance remained soft, affecting overall growth in this segment.
- The company anticipates continued forex headwinds in 2026, potentially impacting margins.
- SGS AG (SGSOF) plans to maintain a 16% adjusted operating income margin, indicating limited margin expansion due to reinvestment in innovative solutions.
Well, good morning, everyone. Thank you for being here for our annual 2025 results presentation. So let me start now here with our first performance. Marta and I will go through the full financial presentations. But here, I would like to start with a couple of remarks.
As we know, for the whole world, 2025 has been a challenging year, marked by international conflicts and fluctuating or volatility in economy. I'm happy to say that at SGS, we've kept the course and even executed our best financial performance ever. We have recorded the highest sales in Swiss francs, highest adjusted operating income and highest free cash flow in the group history.
Sales grew by 2.2% despite a strong adverse forex during the year, again, offset by a strong organic growth of 5.6% and good contribution from acquisitions. The adjusted operating income margin has reached 16%, boosted by operational performance and cost saving plans. Cash generation and earnings per share have recorded excellent growth, and Marta will give more color about this.
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