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Schindler 2016 results largely in line, expects similar growth this year
February 15, 2017 / 8:30 AM / in 5 months

Schindler 2016 results largely in line, expects similar growth this year

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(Reuters) - Schindler Holding (SCHP.S) posted full-year results on Wednesday largely in line with estimates and expected a similar revenue growth for 2017, as the Swiss-based elevator and escalator maker saw improvements in new installations in all markets except China and India.

Its shares hit a six-month high in early trade and were up 1.5 percent at 194 Swiss francs by 0817 GMT.

Net profit climbed 10.2 percent to 823 million Swiss francs ($818 million), slightly above the 819 million francs estimated in a Reuters poll, while orders for 2016 rose 4.6 percent to 10.37 billion francs, marginally missing the poll average of 10.39 billion francs.

"Developments in the Asia-Pacific region during the reporting year were significantly impacted by slower economic growth, a tight real estate market in China and the short-term weakening of the Indian market," the company said on Wednesday.

The company said it expected revenue to grow by between 3 and 5 pct in local currencies for 2017, which is the same as the lowered guidance for last year announced in August.

This fits the current trend outlined by largely China-dependent Finnish rival Kone (KNEBV.HE), whose profit forecast issued in January reflected weak Chinese demand for a second straight year.

Schindler aims to offset market weakness by making more acquisitions in China, as local companies struggle to compete on price, Chief Executive Thomas Oetterli said in December.

In a research note, Morgan Stanley analysts noted the group's lower dependence on the weak China market meant orders could still grow and said it was encouraging that its operations in Brazil were bottoming out.

Schindler's revenue in Latin America rose 3.8 percent in 2016. The region represented 28 percent of overall revenue.

"The recession in Brazil has bottomed out and the positive development of construction activities in Mexico brightened the general picture somewhat and were a source of hope regarding the medium-term outlook," Schindler said.

Schindler plans an ordinary dividend of 3.00 Swiss francs per share and per participation certificate, as well as a special one-off dividend of 2.00 francs per share linked to the sale of ALSO Holding (ALSN.S).

($1 = 1.0058 Swiss francs)

Reporting by Bartosz Dabrowski in Gdynia; Editing by Sherry Jacob-Phillips and David Holmes

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