The general market environment of Arbonia
The German market continues to experience positive growth. Market growth can be primarily attributed to residential construction, in which new constructions have increased by 4–5% in comparison to the previous year. Arbonia expects continued positive market growth in the following years.
The Swiss housing market remains at the same high level as previous years. The most important factor supporting residential construction is the continued high demand for investment properties, due to a lack of investment alternatives. The renovation sector, however, continues to decline, and there are no economic stimuli for commercial properties.
Construction activity in Arbonia's key East European markets of Poland, Slovakia and the Czech Republic is benefiting from strong economic growth with good labour market conditions, that is, rising wages and decreasing unemployment.
Revenue development in the divisions
During the reporting year, the Building Technology Division achieved a total revenue of CHF 555.0 million (previous year: CHF 486.8 million). In 2017, the acquisition of the Koralle Group was consolidated for the full year for the first time, whereas in the previous year this was only taken into account on a pro rata basis. After adjustment for currency and acquisition effects, the revenue growth was 4.1%. The division's financial year was marked by significant increases in raw material prices, particularly for steel, and an unfavourable exchange rate of the Czech koruna, which the division offset with price increases. The significant integration, optimisation and investment programmes to improve competitiveness were continued in all business units.
After the successful integration of the Koralle Group and in order to facilitate further strategic development, the new scale of the Sanitary Equipment Business Unit now requires its own division within the Arbonia Group. To this end, the business unit will be separated from the Building Technology Division. The HVAC business activities will be combined into a newly established HVAC Division. Ulrich Bornkessel, current Head of the Air-Conditioning and Ventilation Technology Business Unit, will take over the management of this division and become a member of Group Management (see group organisation chart).
The Windows Division maintained its revenue of CHF 351.0 million (prior year: CHF 350.8 million) during the reporting year. Adjustment for currency effects resulted in a decrease of 1.4%, which is largely due to the Swiss market. In the other markets, particularly in Poland, Slovakia, and the Czech Republic, the revenue in this financial year increased. The higher volume of orders achieved during the reporting year as result of improved competitiveness and new products should result in a net revenue growth in 2018.
During the reporting year, the Doors Division achieved a revenue of CHF 416.5 million (previous year: CHF 156.7 million). On a pro forma basis (including door business Looser, but without Forster Profile Systems) and adjustment for currency effects, the revenue increased significantly by 4.8%.
The division benefited from the strong European markets during the reporting year, particularly in Germany, where the market share was able to be strengthened again despite capacity bottlenecks. In Switzerland, residential construction and public buildings, such as hospitals and schools, recorded increasing demand. As a result, during the reporting year RWD Schlatter achieved a slight revenue increased in Switzerland in comparison to the previous year.
The sale of Forster Profile Systems to the Belgian Reynaers Group, as announced in December 2017, was completed on 22 January 2018.
Arbonia Group Management is standing by the results forecast that it published for the first half of 2017 for the year as a whole.
On 27 February 2018, the Group will be publishing its annual report for 2017, the contents of which will be the subject of media and analyst conferences to be held in Zurich.