Founded in Switzerland in 1874, the Schindler Group employs around 44 000 people worldwide and is listed on the SWX Swiss Exchange. The Group comprises two core businesses: Elevators & Escalators, which contributed 70% of sales in 2006, and ALSO, an IT distributor in Europe.

http://www.schindler.com/

For the first time in the history of the Schindler Group, orders received and operating revenue exceeded CHF 10 billion. This strong growth was driven by the elevators and escalators business, as well as the acquisition of GNT by the ALSO Group. Net profit rose by 27.4% to CHF 511 million in the reporting year, thus exceeding CHF 500 million for the first time. Schindler Holding Ltd. reported a 32% increase in net profit to CHF233 million. A dividend of CHF 1.30 (previous year: CHF 0.90 after the 1:10 split) will be proposed to the General Meeting.

Net profit exceeds CHF 500 million for the first time

Consolidated operating revenue grew by 25.2% to CHF 11,106 million during the financial year 2006. Operating revenue benefited from a positive foreign exchange rate impact of 2% or CHF 177 million. Net profit totaled CHF 511 million, up 27.4% versus the previous year. This included a profit contribution after tax of CHF 41 million from the sale of real estate. The improvement in net income from financing also contributed to the growth in profit.

Consolidated orders received rose by 24.1% to CHF 11,720 million. The consolidated order backlog was CHF 6,024 million, up 20.4% compared to the previous year. The Group's personnel grew by 8.2% to 43,679 employees.

The Schindler Group's strong growth was partly due to the large volume of sales in the elevators and escalators business and partly to the pro rata consolidation of the Finnish company GNT Holding Oy, which was acquired by ALSO, effective September 1, 2006. As the margins in ALSO's wholesale and logistics business are lower than those in the elevators and escalators business, the acquisition diluted the Group's key figures.

Continued strong sales performance in the elevators and escalators business

The elevators and escalators business recorded strong growth in orders received, which rose by 13.0% to CHF 8,417 million, reflecting contributions from all market regions. Orders for new installations increased by 16.9% and included notable major orders such as Europe's tallest building, the Federation Tower in Moscow, and the World Trade Center, Phase III, which is the tallest building in Beijing. Schindler succeeded in maintaining its global leadership in the escalators business.

Operating revenue grew by 13.6% to CHF 7,829 million. Operating profit (EBIT) increased from CHF632 million to CHF 717 million but included a gain before tax of CHF 63 million from the sale of real estate. At 9.2%, the EBIT margin was unchanged compared to the previous year. Excluding the real estate gain, the EBIT margin declined to 8.4% and was thus below Schindler's expectations.

This decrease was attributable to high conversion and training costs related to the introduction of new product lines in the European markets. In addition, strong demand resulted in production bottlenecks and delays in the installation of new products. The disproportionate growth of the new installations business in the fiercely competitive growth markets, as well as continuing high energy and raw materials costs, also contributed to the pressure on margins.