SGS net profit tumbles by 25 per cent

Despite profit fall, SGS has said its financial position is strong Keystone Archive

The world's largest control and testing group, Société Générale de Surveillance, has reported that profits fell by a quarter in the first six months of the year to SFr43.6 million ($26.11 million).

A statement from SGS headquarters in Geneva said group sales were down by 2.6 per cent to SFr1.164 billion.

SGS said it expected to deliver full year earnings broadly similar to last year, despite the ongoing weakness in the global economy and assuming no significant deterioration in trading conditions.

The group made a profit of SFr128.7 million in 2000, up by 13.3 per cent over the previous year.

In its outlook, SGS said the financial position of the company was strong and the group was considering acquisitions with a view to strengthening its core activities, increasing the financial efficiency of the balance sheet and increasing shareholder value.

The group also confirmed its medium-term performance of 10 per cent sales revenue growth, a growth of earnings before interest and taxes (EBIT) of 10 per cent and a 20 per cent return on shareholders’ equity.

The company had a boardroom battle in 1998 following a 91 per cent fall in net profit to SFr10.3 million for the first six months of the year. A new management team was put in place and the chairman, Elisabeth Salina Amorini, was replaced by Max Amstutz.

swissinfo with agencies