SGS sticks to outlook as H1 sales rise in "challenging" market

ZURICH (Reuters) - Testing and inspection company SGS stuck to its 2022 outlook on Tuesday while reporting higher first-half sales and a modest increase in net profit.

It still saw mid-single digit organic growth this year with an improved adjusted operating income, it said https://www.sgs.com/en/news/2022/07/sgs-2022-half-year-results in a statement.

It said it would accelerate investment into strategic focus areas, with merger and acquisitions playing a key role. It also said it would at least maintain the dividend and use its share buyback programme "on an opportunistic basis".

First-half revenue rose 5.2% to 3.3 billion Swiss francs ($3.38 billion), up 6.8% at constant currency, while adjusted operating income was flat at 458 million francs.

Net profit attributable to shareholders rose 1.5% to 276 million francs.

Reported operating income fell by 7 million francs to 423 million, hit by pandemic restrictions in China now lifted, it said.

SGS, whose activities include environmental testing and public health, said in January it aimed to boost sales and at least maintain its dividend of 80 francs per share.

SGS shares will be replaced in the Swiss blue-chip SMI index by those of hearing aid maker Sonova in September.

($1 = 0.9763 Swiss francs)

(Reporting by Michael Shields, editing by Rachel More)