Schindler Announces 1Q Profits Drop But Beats Estimates

Schindler reported on April 22 a drop in first-quarter net profit but beat the consensus forecast despite supply chain woes, cost inflation, coronavirus lockdowns and market contraction in China, according to Reuters. The company’s net profit of 144 million Swiss francs (US$151.07 million) was below the 2021 figure of 213 million (US$221.98 million) but above the forecast of 137.4 million francs (US$143.21 million) made by a company-compiled consensus. One of the company’s biggest markets is real estate in China, and the crisis in that industry appears to be easing, but margins are threatened by concerns over hyperinflation, persistent supply chain bottlenecks and production snags from COVID flare-ups. Still, revenue came in at 2.63 billion francs (US$2.74 billion), slightly ahead of the same period in the previous year (2.60 billion francs) (US$2.71 billion) and just north of company consensus (2.61 billion francs) (US$2.72 billion). While the company reported order growth of 7.7% globally, new installations in China were down about 15% compared to the previous year. Credit Suisse flagged that Schindler lowered its China outlook to down 15% or more. Despite this, the Swiss lift producer expects second-quarter revenue growth and profitability at the same level as in the first quarter. The company confirmed its revenue growth forecast for 2022 in the range of 1%-6%.