Continuously improved profitability

Note: If not otherwise indicated, changes from the previous year are based on organic figures (adjusted for currency effects, acquisitions / divestitures and deconsolidations).

Performance continued to improve in all three divisions, with order intake and sales increasing by 10.8% year-on-year. Operational profitability further improved by 130 basis points, reaching 12.4%, with all divisions achieving new heights. Free cash flow totaled CHF 234.9 million, down CHF 66.4 million from the previous year. The decrease was mainly impacted by higher CAPEX investments and net working capital requirements to support the backlog increase of 14.9%.

Continued double-digit growth in orders and sales

Order intake rose by 10.8% compared with 2023, reaching CHF 3’848.6 million. Excluding currency conversion impacts, order intake would have amounted to CHF 3’969.0 million. The impact from divestitures, deconsolidations and acquisitions totaled CHF 3.5 million. Order intake gross margin¹ further increased significantly by 110 basis points to 35.0%, as a result of improved pricing and execution of our excellence initiatives supported by portfolio optimization.

Order intake growth in the Flow division reached 12.3%, driven by large orders in the energy transition and security markets and rising demand in the “green minerals” and wastewater sectors. The Services division also experienced continued growth in order intake with a 12.5% increase, particularly in the Americas and Asia-Pacific. Chemtech’s order intake grew by 5.4% after a double-digit growth the past two years, supported by a strong performance in both the Mass Transfer Components & Services business and the System Solutions business.

As of the end of 2024, the order backlog amounted to CHF 2’300.0 million (2023: CHF 1’946.8 million), an increase of 14.9%. Excluding currency conversion impacts, the order backlog would be CHF 2’236.8 million.

1) Order intake gross margin is defined as the expected gross profit of order intake divided by order intake.

Sales increased by 10.8% compared with the previous year reaching CHF 3’530.6 million in 2024. Excluding currency conversion impacts, sales would be CHF 3’639.4 million. The net effect from divestitures, deconsolidations and acquisitions amounted to CHF 3.8 million.

The Flow division contributed with strong sales growth of 9.4%. This was mainly driven by the Energy and Infrastructure business benefiting from a solid order backlog entering the year. For the second consecutive year, the Services division reported double-digit sales growth, achieving 12.3%, with all regions contributing. The Chemtech division achieved double-digit sales growth for the third consecutive year, increasing by 10.9%, largely due to the solid execution of large orders from the backlog.

Sulzer’s continued strong financial performance in 2024 highlights our strategic position in key markets experiencing favorable momentum and the impact of our commitment to operational excellence.”

Thomas Zickler Chief Financial Officer

Sustainable growth in profit margins

Gross profit margin increased to 33.5% (2023: 33.0%), supported by a larger share of high-margin business and continued impact from operational excellence. Coupled with increased sales volume, gross profit reached CHF 1’183.2 million (2023: CHF 1’084.6 million). Excluding currency conversion impacts, the gross profit would be CHF 1’218.8 million.

Operational profitability at 12.4%

Operational profit amounted to CHF 436.2 million compared with CHF 365.6 million in 2023, an increase of 24.7%. Higher sales volumes and better margins, supported by the execution of operational excellence initiatives, resulted in operational profitability of 12.4%, 130 basis points higher than 2023. All divisions successfully increased operational profitability led by Flow and Chemtech.

In the Flow division, operational profitability increased to 9.5% (2023: 8.0%), supported by manufacturing improvements and structural cost optimization. Services reached 15.0% (2023: 14.8%) in operational profitability as a result of higher sales offset by one-off investments in excellence initiatives and footprint expansion. Chemtech achieved strong operational profitability of 14.1% (2023: 12.3%) benefiting from the execution of projects with favorable margins and continued focus on excellence measures.

Bridge from operational profit to EBIT

Return on sales of 10.8%

EBIT for 2024 increased 21.8% to CHF 382.5 million from CHF 329.7 million in 2023. Excluding currency conversion impacts, EBIT would be CHF 402.4 million. Return on sales (ROS) grew by 80 basis points to 10.8%.

Calculation of return on sales (ROS) and operational profitability

Financial result

Total net financial expenses amounted to CHF 25.2 million compared with CHF 22.2 million in 2023.

Net interest expenses decreased to CHF 9.7 million compared with CHF 11.9 million in 2023 as a result of higher interest income on defined benefit plans. Fair value changes on financial assets and liabilities had a negative impact of CHF 12.7 million (2023: CHF +5.1 million). Currency exchange losses and other financial expenses amounted to CHF 2.8 million (2023: CHF 15.4 million).

Effective tax rate of 24.9%

Income tax expenses increased by 22.5%, reaching CHF 88.2 million in 2024 (2023: CHF 73.8 million), primarily due to higher taxable income. The effective tax rate (ETR) increased to 24.9% in 2024, compared with 24.2% in 2023, largely because of increased profits in countries with higher taxes.

Higher net income and core net income

Net income increased to CHF 265.4 million compared with CHF 230.5 million in the previous year. Core net income, excluding the tax-adjusted effects of non-operational items, totaled CHF 307.2 million compared with CHF 257.9 million in 2023. Basic earnings per share increased by 18.8%, reaching CHF 7.73 million in 2024 (2023: CHF 6.76 million).

Bridge from net income to core net income

Key balance sheet positions

Note: If not otherwise indicated, balance sheet movements from the previous year are based on nominal figures.

As of December 31, 2024, total assets amounted to CHF 4’714.3 million (2023: CHF 4’369.5 million), reflecting a year-over-year increase of CHF 344.8 million. Non-current assets increased by CHF 29.6 million to CHF 1’715.5 million, mainly coming from an increase of CHF 51.5 million in property, plant and equipment and leased assets, together with a goodwill increase of CHF 23.5 million (CHF 12.6 million related to currency translation and CHF 10.8 million from acquisitions). Current assets increased by CHF 315.2 million to 2’998.8 million, relating to higher balances in trade accounts receivables, contract assets, inventories and supplier advances. In addition, cash and cash equivalents increased by CHF 85.9 million to CHF 1’060.6 million.

Total liabilities increased by CHF 208.3 million to CHF 3’479.1 million as of December 31, 2024. The increase was primarily driven by higher accrued liabilities, contract liabilities and trade accounts payables.

Equity increased by CHF 136.5 million to CHF 1’235.1 million. This was driven by net income (CHF 265.4 million), partly offset by dividend distribution (CHF 127.6 million).

Net debt decreased from CHF 172.3 million in 2023 to CHF 100.4 million in 2024, mainly driven by an increase in cash and cash equivalents. Net debt to EBITDA improved to 0.20 from 0.39 in 2023 due to the increase in EBITDA and decrease in net debt.

Free cash flow impacted by CAPEX investments and net working capital

At CHF 234.9 million (2023: CHF 301.3 million), free cash flow decreased mainly due to higher requirements on net working capital, driven by higher inventories to support backlog execution and higher receivables. Additional impacts resulted from CHF 27.9 million higher CAPEX investments aimed at meeting growing demand and executing operational excellence, as well as increased tax payments of CHF 30.0 million. All these factors resulted in a CHF 38.4 million decrease in cash flow from operating activities to CHF 323.8 million (2023: CHF 362.2 million).

Bridge from cash flow from operating activities to free cash flow

Cash outflow from investing activities totaled CHF 98.2 million compared with CHF 104.8 million in 2023. At CHF 88.9 million, the net cash outflow for purchases and sales of property, plant and equipment and intangible assets was CHF 28.0 million higher (2023: CHF 61.0 million). In addition, acquisitions, divestitures and deconsolidation-related outflows amounted to CHF 13.1 million versus CHF 45.8 million.

Cash outflow from financing activities amounted to CHF 151.6 million compared with CHF 448.6 million in 2023 when a maturing bond of CHF 290 million was not refinanced. This outflow primarily consisted of CHF 86.5 million in dividend payments and CHF 33.2 million for the acquisition of treasury shares.

Overall, the positive net change in cash since January 1, 2024, amounted to CHF 85.9 million, including exchange gains on cash and cash equivalents of CHF 11.9 million.

Outlook for 2025

As for 2025, we are focused on the path to become a top industrial company that truly creates value. We will continue to invest in key areas across the company and execute on our excellence and growth initiatives. Due to the limited visibility of the market developments and the unpredictable timing of expected large orders, the year-on-year growth of order intake is difficult to forecast, especially on a quarterly basis. However, we are confident in our strategy and position in essential markets. The company expects another year of good performance with year-on-year organic growth for order intake of 2% to 5% and for sales of 5% to 8%. The EBITDA margin is expected to further increase to above 15% of sales.

Abbreviations

EBIT: Earnings before interest and taxes

ROS: Return on sales

EBITDA: Earnings before interest, taxes, depreciation, amortization and impairment

FCF: Free cash flow

For the definition of the alternative performance measures, please refer to the “Supplementary information.”

Our Key Figures

Flow