Sika: H1‘26 beat suggests Sika has turned a corner and is starting to deliver on strategy (with model update)

Research evidence excerpt

Sika: H1‘26 beat suggests Sika has turned a corner and is starting to deliver on strategy (with model update)

r the muted headline number for the next transport bill)

and double digit growth in data center projects.

• H1 APAC sales of CHF 1,059mn, 1.2% ahead of consensus and down 9.1% y-o-y with LC decline of -2.0% (+90bps vs

cons) driven by double-digit decline in the Chinese construction sector, partly offset by growth across most of the region

especially India and South East Asia. Organic growth came in at -2.1% in H1 (vs -2.3% in Q1 implying -1.1% in Q2). The

outlook for China remain muted with double digit decline in the underlying construction market, however the Government

plans of investment in construction might provide a much needed boost to underlying activity. The CEO also highlighted

that while pricing remains challenged in China, their Fast Forward Program is well on track where Sika have removed low

value add products and now the exposure to high value add products has increased which helps with pricing. Despite China

having a greater weightage in Q2 compared to Q1, the fact that Sika was able to stall the decline in Q2, suggests

stronger than expected growth in the rest of the region. APAC ex China construction organic growth would have been

7.7%.

Wage inflation: The CFO highlighted personnel costs decreased 3% driven by the actions taken as part of the Fast Forward

program, where headcount has been reduced by ~1000 personnel. This is partly offsetting wage inflation.

Data centres: The CEO highlighted that the data center contribution is still growing with strong momentum, especially in North

America where it contributes double digit share of revenue. On a group level it is at the mid-single digit contribution and

also growing.