Press Release: SIKA ON TRACK FOR RECORD RESULTS -- STRONG GROWTH IN SALES AND EBIT IN THE FIRST HALF YEAR

SIKA ON TRACK FOR RECORD RESULTS -- STRONG GROWTH IN SALES AND EBIT IN

THE FIRST HALF YEAR

-- Sales growth of 9.6% in local currencies to CHF 3,732.4 million (+7.6% in

CHF)

-- Growth in all regions

-- Higher gross result -- EBIT increase of 8.3%

-- Conclusion of Parex acquisition provides boost to growth, takeover of

King Packaged Materials in Canada and Belineco in Belarus

-- Opening of three new factories

-- Outlook: sales of over CHF 8 billion and double-digit EBIT growth for

2019

Sika recorded strong single-digit sales growth in the first half of the

year, posting a new sales record of CHF 3,732.4 million. This equates to

an increase of 9.6% in local currencies. Sales growth in CHF amounted to

7.6% (--2.0% currency effect).

HIGHER GROSS RESULT -- EBIT INCREASED BY 8.3%

In the first half of the year, Sika managed to increase its gross result

to 53.8% (previous year: 53.6%). Despite one-off effects, operating

profit (EBIT) improved by 8.3% to a new record level of CHF 481.7

million (previous year: CHF 444.6 million). Acquisition and integration

costs in connection with the takeover of Parex amounted to CHF 30.8

million, whereof CHF 6.7 million were non-recurring financial expenses.

In the prior-year period, one-off effects in connection with the

solution to the takeover dispute with Saint-Gobain amounted to CHF 23

million.

Paul Schuler, Chief Executive Officer: "We are well-positioned in a

commercially challenging environment, and achieved a strong sales growth

of 9.6% in the first half of 2019. We are enjoying a significant boost

to growth thanks to the Parex acquisition, and are well on track to

exceed the sales mark of CHF 8 billion. Our collaboration during the

integration process is working outstandingly, and we are exploiting our

synergy potential in procurement, logistics, and production. Our joint

distribution and cross-selling activities are already revealing the

strength of our combined market presence."

GROWTH IN ALL REGIONS

The first half of the year saw Sika make the largest acquisition in its

history with the takeover of Parex, a globally leading producer of

facade mortar, technical mortar, tile adhesives, and waterproofing

systems. The company has a particularly strong presence in distribution

channels and is represented in 23 countries. The integration is

proceeding successfully according to plan, and numerous projects are

already being implemented.

The EMEA region (Europe, Middle East, Africa) reported a sales increase

in local currency of 7.7% (previous year: 13.6%) in the first half of

the year. This region recorded strong growth with double-digit growth

rates in Africa and high single-digit growth in Eastern Europe. Growth

in many major European markets developed moderately, due to the lower

number of working days in the second quarter.

In Belarus, Sika acquired Belineco, a specialist manufacturer of

polyurethane foam systems, thereby expanding its know-how in the

development and production of PU foams. Production capacity was expanded

in Senegal, Egypt, and Qatar, with new factories opened for the

production of concrete admixtures and mortar.

The Americas region recorded a strong sales increase of 11.4% (previous

year: 13.6%). Growth has been accelerating in North America in spite of

the ongoing shortage of specialist labor in the construction sector.

Latin America recorded high growth with above-average business

development in Brazil, Colombia, and Peru. In Mexico, the repercussions

of the change in government were tangible in the implementation of

infrastructure projects.

In Canada, the acquisition of the King Packaged Materials Company in the

reporting period brought a leading manufacturer of concrete repair

systems into the Group.

Growth in the Asia/Pacific region amounted to 15.6% (previous year:

5.0%). Here the highest growth rates were recorded by India and China.

In order to mitigate the economic impact of the trade tariff conflict

with the United States, the Chinese government increased its expenditure

on infrastructure projects.

The Global Business segment recorded a growth rate of 4.9% (previous

year: 28.5%). In the Automotive area, Sika generated further growth in

the first half of the year, despite a strong decline in the global car

production figures. In particular, the company is benefiting from the

megatrends evident in modern automotive construction, which are

dominated by electromobility and lightweight construction. New, lighter

platforms and multi-material designs are opening up new avenues of

growth potential for Sika.

OUTLOOK: SALES OF OVER CHF 8 BILLION AND DOUBLE-DIGIT EBIT GROWTH FOR

2019

For the 2019 financial year, Sika is expecting an increase in sales to

more than CHF 8 billion along with double-digit EBIT growth. The

implementation of the Group's growth strategy will continue in 2019 with

the opening of between seven and nine new factories, and the

establishment of further growth platforms in the form of acquisitions.

Details of the new Strategy 2023 will be presented at the Sika Capital

Markets Day on October 3, 2019.

KEY FIGURES HALF-YEAR 2019

in CHF mn 1/1/2018 -6/30/2018 1/1/2019 -6/30/2019 Change in %

----------------------- ------------------- ------------------- -----------

Net sales 3,470.1 3,732.4 7.6

----------------------- ------------------- ------------------- -----------

Gross result 1,861.2 2,008.9 7.9

----------------------- ------------------- ------------------- -----------

Operating profit before

depreciation (EBITDA) 544.8 623.8 14.5

----------------------- ------------------- ------------------- -----------

Operating profit (EBIT) 444.6 481.7 8.3

----------------------- ------------------- ------------------- -----------

Net profit after taxes 318.2 330.7 3.9

----------------------- ------------------- ------------------- -----------

Undiluted earnings per

share (in CHF) 2.12 2.31 9.0

----------------------- ------------------- ------------------- -----------

Diluted earnings per

share (in CHF)(1) 2.11 2.11 0.0

----------------------- ------------------- ------------------- -----------

Operating free cash

flow 11.5 179.7

----------------------- ------------------- ------------------- -----------

Balance sheet total(2) 6,382.0 10'139.1

----------------------- ------------------- ------------------- -----------

Shareholders' equity(2) 1,675.2 2'835.4

----------------------- ------------------- ------------------- -----------

Equity ratio in % (2,3) 26.2 28.0

----------------------- ------------------- ------------------- -----------

Return on capital

employed (ROCE) in %

(4) 26.2 17.0

----------------------- ------------------- ------------------- -----------

1 Dilutive effect due to convertible bonds issued.

2 As of December 31, 2018/June 30, 2019.

3 Shareholders' equity divided by balance sheet total.

4 Capital employed = current assets, PPE, intangible

assets less cash and cash equivalents, current securities,

current liabilities (excluding bank loans and bond).

This includes the capital employed from the initial

consolidation of Parex.

NET SALES BY REGION

1/1/2018 1/1/2019 Change compared to prior year

in CHF mn -6/30/2018 -6/30/2019 (+/- in %)

-------------- ---------- ---------- -----------------------------------------

In local Currency Acquisition

In CHF currencies impact effect

-------------- ---------- ---------- ------ ---------- -------- -----------

By region

-------------- ---------- ---------- ------ ---------- -------- -----------

EMEA 1,558.1 1,617.0 3.8 7.7 -3.9 4.2

-------------- ---------- ---------- ------ ---------- -------- -----------

Americas 889.2 995.7 12.0 11.4 0.6 7.1

-------------- ---------- ---------- ------ ---------- -------- -----------

Asia/Pacific 559.1 641.8 14.8 15.6 -0.8 12.9

-------------- ---------- ---------- ------ ---------- -------- -----------

Global

Business 463.7 477.9 3.1 4.9 -1.8 5.2

-------------- ---------- ---------- ------ ---------- -------- -----------

Net sales 3,470.1 3,732.4 7.6 9.6 -2.0 6.5

-------------- ---------- ---------- ------ ---------- -------- -----------

Products for

construction

industry 2,651.2 2,888.9 9.0 10.9 -1.9 7.6

-------------- ---------- ---------- ------ ---------- -------- -----------

Products for

industrial

manufacturing 818.9 843.5 3.0 5.3 -2.3 3.0

-------------- ---------- ---------- ------ ---------- -------- -----------

Conference call today, July 25, 2019 at 3 pm (CET)

In connection with the publication of the half-year

results a conference call will be held today. Please

dial in 10 to 15 minutes before the start at:

+41 58 310 5000 (Europe, Asia)

+1 631 570 5613 (North America, Latin America)

+44 207 107 0613 (UK)

An operator will then connect you with Paul Schuler

(CEO), Adrian Widmer (CFO) and Dominik Slappnig (Head

Corporate Communications & IR).

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July 24, 2019 23:00 ET (03:00 GMT)