2019 Hilti Company Report PROFITABLE GROWTH IN A CHALLENGING ENVIRONMENT CHF 783 million With sales growing by 4.3 percent to CHF 5.9 billion, the Hilti Group posted an operating result of CHF 783 million in 2019 (+7.4%). This increase came The Hilti Group’s operating result increased by 7.4 percent. in a challenging economic and currency environment and despite ongoing investments in the implementation of the corporate strategy as well as in new initiatives to strengthen the company’s future viability. Hilti produced solid sales growth in world had a negative impact on sales the construction site by also making At 13.3 percent (2018: 12.9%), this had – despite good natural hedging in CHF 294 million for the 2019 昀椀nancial main currencies – a negative impact year (2018: CHF 272 million). 2019 despite the noticeable economic in Swiss francs totaling 2 percentage wide-ranging investments in this area. 昀椀gure is back at its 2017 level. By slowdown. The North America and points. In 2019, for example, new centers for contrast, the return on capital em- of CHF -27 million on the operating Outlook for 2020 Europe business regions grew, in local digital marketing were developed ployed (ROCE), at 19.8 percent, is result (2018: CHF -20 million). 0.8 percentage points lower than the Economic forecasts point to further currencies, by 7.3 and 6.9 percent, re- Hilti continues to invest in prod- in Paris (France) and Plano (Texas, USA). A new customer management year before, which is solely due to a Very healthy balance sheet and weakening of the environment in 2020. spectively. The above-average growth ucts, services and software solid liquidity This development is underscored by rates in Central and Western Europe The Hilti Group also brought numer- system was also introduced to further change in accounting (IFRS 16). As a were particularly gratifying. Similar ous innovations (70) onto the mar- increase the quality of consulting and result of this change, lease liabilities The equity ratio was 4 percentage greater political uncertainty and trade ket in 2019, which was the result of the effectiveness of the company’s are allocated to the operating capital, points below the previous year’s con昀氀icts. The global construction to the previous year, Latin America market will not be able to escape 昀椀gure (55%). The main reason for posted an increase of 8.5 percent, the continued increase in expendi- direct sales model. Efforts to digitize and therefore this 昀椀gure increased these forces and it is expected to cool this is the introduction of IFRS 16 driven by the further recovery of the ture on research and development, corporate processes and new per- by CHF 385.2 million on a one-off Brazilian market. The performance which advanced by 3.2 percent to sonnel processes and systems were basis. However, the ROS and ROCE and the resulting rebalancing of further, with market growth in the low also driven forward. As of the end of continue to hover at the upper end lease liabilities. Nevertheless, the single digits. However, the Group is in the Eastern Europe / Middle East CHF 367 million. This investment is / Africa region was mixed (+3.7%). nearly 100 percent higher than in 2013 the year, the Group had 30,000 team of the target corridor of 10-12 and equity ratio continues to be more adhering to its strategic objectives members, with around 1000 more 15-20 percent, respectively. The free than the target level of 50 percent. and will use its solid 昀椀nancial position While the Middle East was affected ( CHF 189 million), when the Champion to make additional signi昀椀cant invest- At CHF 1.11 billion, cash and cash by political tensions, Eastern Europe 2020 strategy was developed, under- employees than a year ago. cash 昀氀ow (before the acquisition and saw double-digit growth. In the Asia/ scoring the company’s consistent sale of Group companies, incl. lease equivalents remained stable and were ments in innovative solutions and the slightly higher than the previous year digitalization of corporate processes. Paci昀椀c region, growth slowed to focus on product and service differen- Increased operating result and payments) climbed to CHF 303 million The Hilti Group expects sales growth (CHF 1.03 billion). Financial liabilities (2018: CHF 245 million). A signi昀椀cant 4.3 percent and was therefore below tiation. With the additional expansion pro昀椀tability expectations. Overall, Hilti posted of integrated solutions combining The operating result rose by 7.4 per- factor here is the normalization of the increased to CHF 1,029 million in 2020 in the mid-single digits and pro昀椀tability at around the same levels inventory level that had been built up mainly due to the adoption of IFRS almost triple the average growth in products, software and services, cent to CHF 783 million (2018: as in 2019. the global construction market and Hilti continues to provide innovative CHF 728 million). Net income was in 2018. The negative development 16 (2018: CHF 515 million). Given the gained further market share. A weaker concepts for the professional con- CHF 591 million (2018: CHF 546 million). of the euro exchange rate and the Group’s healthy 昀椀nancial situation, euro and the ongoing decline in value struction industry. Hilti has acknowl- Despite the continued investments, ongoing depreciation of other cur- the Board of Directors proposes the of a number of currencies around the edged increasing digitalization on the return on sales (ROS) grew slightly. rencies compared to the Swiss franc payout of an ordinary dividend of 70–71