– Business review – Financial review

Strong performance in all businesses

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

Order intake increased by 24.1%, with strong commercial results in all divisions. Sales also rose substantially, recording a year-on-year improvement of 15.4%. Operational profitability reached 10.1%, up 110 basis points versus H1 2022. Free cash flow (FCF) amounted to CHF 106.6 million, up CHF 184.8 million from CHF –78.2 million.

Strong growth momentum in all three divisions

Compared to the first half of 2022, Sulzer grew its order intake by 24.1% to CHF 1’992.4 million. This is despite negative currency translation effects on order intake of CHF 136.0 million and a CHF 24.0 million negative impact from divestitures and deconsolidations. Order intake gross margin increased nominally by 20 basis points to 33.0%.

Order intake in Flow Equipment grew by 25.1%, primarily driven by an 84.3% increase in Energy orders. Water orders were stable, whereas order intake in the Industry segment saw a slight decline of 1.2%. In the Services division, orders also grew by a significant 22.1%. From a regional perspective, order intake was particularly strong in the Americas, with a 34.7% increase, and in Europe, the Middle East and Africa (EMEA), with 14.0% growth. This more than offset a 7.6% drop in Asia-Pacific, where a large order had been booked in the first half of 2022. Chemtech’s order intake increased by 25.3%, led by year-on-year increases in Asia-Pacific of 29.7% and the Americas of 25.0%, compensating for a decline in Europe/Rest of Africa (ERA) of 21.8%. Chemtech orders continued to grow strongly across all businesses, particularly in the Renewables segment, increasing by 78.9% to a total of 88.7 million, representing 17.6% of Chemtech's total order intake.

Sulzer enters the second half of 2023 with an order backlog of CHF 2’141.7 million (December 31, 2022: CHF 1’844.7 million). This figure includes negative currency translation effects of CHF 155.3 million.


Strong demand for Sulzer’s innovative solutions has led to significant order growth in all divisions. Thanks to excellent order execution and higher margins, sales and profits rose significantly. We expect momentum to continue into H2, and as a result have increased our full year guidance for orders, sales and profitability.”

Thomas ZicklerChief Financial Officer


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Order intake





Order intake gross margin





Order backlog as of June 30 / December 31





Sales increased by 15.4% year-on-year to CHF 1’601.6 million, despite a negative impact from divestitures of CHF 43.2 million and negative currency translation effects of CHF 105.8 million.

Sales in the Flow Equipment division grew by 14.1%. The biggest increase could be observed in Water, with a 19.5% increase, followed by Industry, which was up 18.4%. Both businesses were particularly affected by supply chain issues in the first half of 2022, which eased in 2023, while Energy sales increased by 4.7%. Sales in Services grew strongly in all regions, leading to an overall increase of 11.3%. Again, growth was highest in the Americas, but Asia-Pacific and EMEA sales also saw strong growth. In Chemtech, sales were up by a significant 24.3% thanks to a strong focus on executing the high backlog with which the division entered the year.

Higher gross profit margin

Gross profit margin increased to 32.3%, significantly above the 28.4% reported in the first half of 2022, when Russia-related write-offs of CHF 38.8 million reduced the reported margin. Excluding these write-offs, the margin level in the first half of 2023 was above that of the previous year thanks to solid execution and a better mix. Coupled with the increased sales volume, gross profit reached CHF 516.9 million (H1 2022: CHF 430.9 million).

Increased operational profitability at 10.1%

Operational profit amounted to CHF 162.4 million, compared with CHF 135.8 million in the first half of 2022, an increase of 27.3%. Higher sales volumes, solid margins and a better mix were the main contributors to this increase, resulting in operational profitability of 10.1% (first half of 2022: 9.0%).

Increases in operational profitability were achieved in all divisions:

  • Flow Equipment increased to 7.0%, compared to 5.3% in the first half of 2022
  • Services achieved 14.2%, up 90 basis points from 13.3% in the prior year
  • Chemtech improved operational profitability to 11.7%, compared to 9.9% at the end of June 2022

Bridge from operational profit to EBIT (January 1 – June 30)

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Operational profit










Impairments on tangible and intangible assets





Restructuring expenses





Non-operational items 1)










1) Non-operational items include significant acquisition-related expenses, gains and losses from the sale of businesses or real estate (including release of provisions), and certain non-operational items that are non-recurring or do not regularly occur in similar magnitude.

Return on sales of 9.5%

In the first half of 2023, as a result of the deconsolidation of Russian business activities, a gain from deconsolidation of CHF 8.0 million was booked and recorded as non-operational items. In contrast, Sulzer had incurred one-off expenses of CHF 141.4 million by June 30, 2022, mainly consisting of write-offs in relation to the exit from Russia and closures in Poland, which accounted for CHF 132.5 million.

By June 30, 2023, EBIT amounted to CHF 151.5 million, compared with CHF –25.5 million in the first half of 2022, which included the above-mentioned write-offs relating to the exit from Russia. Return on sales (ROS) was 9.5%, compared with –1.7% by June 30, 2022.

ROS and operational profitability (January 1 – June 30)

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Return on sales (ROS)










Operational profit










Operational profitability





Financial result

Total financial expenses amounted to CHF 12.8 million, compared with financial income of CHF 8.5 million in the first half of 2022. Net interest expenses improved from CHF 9.7 million in the first half of 2022 to CHF 5.6 million for the same period in 2023. Fair value changes from hedging instruments for non-operating items had a negative impact of CHF 9.1 million (positive impact of CHF 9.1 million as of June 30, 2022). Other currency exchange gains amounted to CHF 2.7 million, compared with a gain of CHF 10.3 million in the first half of 2022, when negative foreign exchange movements on non-operating items were more than offset by a CHF 21.0 million positive impact from unhedged intercompany loans to Russia.

Effective tax rate improves to 24.2%

The estimated average annual tax rate used for 2023 is projected to be 24.2%, compared with 166.4% (excluding Russia and Poland: 30.3%) for the six months ending June 30, 2022. Income tax expenses amounted to  CHF 33.3 million in the first half of 2023, compared to CHF 30.5 million for the six months ending June 30, 2022, due to significantly higher taxable income.

Higher net income and core net income

Due to higher operational profits, net income increased to CHF 104.3 million, compared with CHF –48.8 million in the previous year, which was impacted by one-off items. Core net income, which excludes restructuring expenses, amortization, impairments, non-operational items and the tax-adjusted effects of non-operational items, totaled CHF 114.4 million, compared with CHF 74.4 million in the first half of 2022. Basic earnings per share increased from CHF –1.43 for the period to June 30, 2022, to CHF 3.07 in the first six months of 2023.

Bridge from net income to core net income

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Net income










Impairments on tangible and intangible assets





Restructuring expenses





Non-operational items 1)





Tax impact on above items





Core net income 2)





1) Other non-operational items include significant acquisition-related expenses, gains and losses from the sale of businesses or real estate (including release of provisions), and certain non-operational items that are non-recurring or do not regularly occur in similar magnitude.

2) Core net income excludes adjustments for financial items.

Key balance sheet positions

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

Total assets as of June 30, 2023, amounted to CHF 4’539.3 million, a decrease of CHF 80.9 million from December 31, 2022. Non-current assets decreased by CHF 33.2 million to CHF 1’551.0 million, mainly because of negative foreign exchange impacts of CHF 17.7 million on goodwill denominated in currencies other than the Swiss franc and decreased other intangible assets of CHF 18.1 million. Current assets decreased by CHF 47.7 million, including CHF 30.4 million attributable to the deconsolidation of the Russian operations that were previously classified as 'held for sale.' In addition, cash and cash equivalents decreased by CHF 54.9 million, mostly driven by dividend payments. Inventories increased ( CHF 18.0 million), as did supplier advances ( CHF 28.0 million), whereas trade account receivables were reduced by CHF 32.3 million.

Total liabilities increased by CHF 5.1 million to CHF 3’596.6 million as of June 30, 2023. The main reasons were an increase in contract liabilities ( CHF 59.5 million) and a decrease of trade accounts payable ( CHF 25.6 million). CHF 25.4 million of liabilities previously classified as held for sale were eliminated as a result of the deconsolidation of the Russian business.

Equity decreased by CHF 86.0 million to CHF 942.6 million. This decrease was mainly driven by dividend distribution ( CHF 119.0 million) and currency translation effects ( CHF 67.1 million), only partly offset by net income ( CHF 104.3 million).

Free cash flow improved

Free cash flow significantly improved and amounted to CHF 106.6 million in the first half of 2023, compared to CHF –78.2 million reported by June 30, 2022. Higher net income, better working capital management and lower tax payments were the main drivers for this improvement.

Bridge from cash flow from operating activities to free cash flow

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Cash flow from operating activities





Purchase of intangible assets





Sale of intangible assets





Purchase of property, plant and equipment





Sale of property, plant and equipment





Free cash flow (FCF)





In the first half of 2023, cash outflow from investing activities amounted to CHF 68.2 million, compared with CHF 28.3 million in the first half of 2022. Besides the net cash outflow of CHF 26.7 million for purchases and sales of property, plant and equipment and intangible assets, this was largely driven by acquisitions and divestiture/deconsolidation-related outflows of CHF 43.4 million.

Cash outflow from financing activities totaled CHF 124.3 million, compared with CHF 113.4 million in the first half of 2022. Dividend payments amounted to CHF 80.9 million, compared with CHF 80.6 million in 2022. The net change in cash since January 1, 2023, amounted to CHF –83.5 million, including exchange losses on cash and cash equivalents of CHF 24.3 million.

Outlook for 2023

We have had a very strong year to date and expect demand in our markets to remain robust. Based on our strong position in growing markets, we have recently increased our guidance and expect organic order growth of 10 to 14% year-on-year, organic sales growth of 11 to 13% and operational profitability around 11% of sales.


EBIT: Earnings before interest and taxes
ROS: Return on sales
EBITDA: Earnings before interest, taxes, depreciation and amortization
FCF: Free cash flow
For the definition of the alternative performance measures, please refer to “Supplementary information” in the Annual Report 2022.