“The pandemic has also impacted Schindler”

The COVID-19 pandemic had significant impacts on Schindler’s business in 2020. Order intake decreased by 9.1% to CHF 11 018 million and revenue dropped by 5.6% to CHF 10 640 million, operating profit reached CHF 1 032 million, corresponding to an EBIT margin of 9.7% (EBIT adjusted 11.1%).

Net profit amounted to CHF 774 million, and cash flow from operating activities increased.

"The pandemic has also impacted Schindler. We introduced a series of measures to enhance our competitiveness, as some of the key markets have been experiencing a contraction and are not likely to return to 2019 levels before 2022 at the very earliest," says Thomas Oetterli, Schindler’s CEO. According to the company, Schindler remains on course with its long-term objectives, kept accelerating innovation, and continued to invest in technology – despite the adverse environment.

Order intake and order backlog

With the exception of China, markets around the globe have been negatively impacted by the COVID-19 pandemic. The construction sector – and with it the elevator and escalator new installation and modernization markets – contracted abruptly, with no recovery in sight to 2019 levels until 2022, at the very earliest. Only a few markets, such as China, managed quick recoveries.

For the whole year 2020, Schindler’s order intake decreased by 3.2% in local currencies, equivalent to a drop of 9.1% to CHF 11 018 million in variable terms (previous year: CHF 12 123 million). China recorded the highest growth, followed by the EMEA region, whereas order intake decreased in the Americas and the rest of Asia-Pacific. In the fourth quarter, order intake increased by 1.1% in local currencies, corresponding to a decline by 5.2% in variable terms (CHF 2 951 million, previous year: CHF 3 114 million).

As of December 31, 2020, the order backlog reached CHF 8 687 million (previous year: CHF 9 042 million), corresponding to an increase of 2.4% in local currencies, or a decrease of 3.9% in variable terms, respectively.

Revenue 2020

Revenue for the year increased slightly by 0.4% in local currencies, equivalent to reported revenue of CHF 10 640 million in 2020 (previous year: CHF 11 271 million), corresponding to a drop of 5.6%. Revenue dropped slightly in the Americas; Europe managed to attain 2019 levels, while Asia-Pacific generated growth driven by a strong performance of the Chinese operation. In the fourth quarter, revenue increased by 3.3% in local currencies. In absolute terms, revenue decreased by 3.0% to CHF 2 927 million (previous year: CHF 3 016 million).

The appreciation of the Swiss franc against all major currencies led to additional pressure on revenue and profitability, stresses Schindler: "Faced with the reality of contracting markets and a worsening foreign currency environment, the company launched measures to remain competitive and to stay on course with its growth agenda. These included the factory closure in Zaragoza, Spain, organizational effectiveness initiatives, and a global cost optimization program to realign capacities and resources with the ongoing market resizing, resulting in the reduction of about 2 000 jobs worldwide within two years."

Operating profit (EBIT)

Operating profit (EBIT) reached CHF 1 032 million (previous year: CHF 1 258 million), which corresponds to a decrease of 18.0% (–11.0% in local currencies). EBIT margin was 9.7% (previous year: 11.2%).

The result includes restructuring costs of CHF 135 million (previous year: CHF 38 million), related to the factory closure in Spain and the global cost optimization program. EBIT adjusted reached CHF 1 185 million with a margin of 11.1% (previous year: CHF 1 314 million, 11.7%).

In the fourth quarter, operating profit amounted to CHF 298 million (previous year: CHF 335 million), representing a drop of 11.0% (–4.2% in local currencies). EBIT margin was 10.2% (previous year: 11.1%). The adjusted EBIT margin reached 11.7% (previous year: 12.1%). Net profit and cash flow from operating activities.

Net profit totaled CHF 774 million compared to the previous year’s result of CHF 929 million. Cash flow from operating activities increased by 33.4%, reaching CHF 1 581 million (previous year: CHF 1 185 million, adjusted for one-off impacts: CHF 1 342 million) as a result of the effective net working capital optimization measures implemented across the Group.

Schindler Holding Ltd. profit and dividend

Schindler Holding Ltd. closed the fiscal year 2020 with a net profit of CHF 615 million (previous year: CHF 600 million). The Board of Directors will submit a proposal to the forthcoming General Meeting of March 23, 2021, for a dividend of CHF 4.00 per registered share and per participation certificate.

Outlook for 2021

For 2021, "barring unexpected events", the company’s revenue growth is expected to reach levels between 0% and 5% in local currencies. As in previous years, the net profit guidance shall be provided in combination with the publication of the half-year results.

Annual Report www.schindler.com/com/internet/en/investor-relations/conference-call-details.html