Business and financial review


Construction industry

The year 2012 in the construction industry will continue to be marked by political and macro-economic uncertainties. The development in the individual regions/markets and construction sectors will, however, strongly diverge. Generally speaking, it is very difficult, in view of the great uncertainties, to make a reliable prediction about perspectives in the construction sector.

In Europe, a slide into an – at least mild – recession is probable. A drop is expected in state-financed projects, and consumer spending and consumer mood will not improve significantly. In the construction sector, prognoses indicate a coming positive trend in residential construction to at least partially compensate for the weak non-residential construction sector. In Germany, Austria, Switzerland, Norway and Russia, a continued positive development in residential construction is predicted. A stagnation in this area is anticipated in Belgium, France, Great Britain, Sweden and Denmark. Declines are to be reckoned with in the Netherlands, Ireland, Portugal, Spain, Italy, Poland and Finland.

In North America, the construction sector continues to be in a crisis. Residential construction will, however, - even if only very slowly - recover in the coming year. The latest trends in several relevant indicators are suggestive of this recovery. As before, however, applications for new mortgage credits are at a 15-year low, despite a record-low interest level. Public outlays for construction projects will continue to decrease. In view of the fact that the commercial construction sector follows the development in the private sector, although not until after a certain amount of time has passed, growth can also be anticipated again in this sector in the medium term.

In China, the effects of the government measures to prevent an overheating in the real estate market have been felt since the fourth quarter of 2011. It is, however, to be assumed that the Chinese government has an interest in a soft landing in residential construction. In contrast to this, the situation in Chinese non-residential construction continues to be robust. Double-digit growth figures are anticipated for the entire construction sector in India. The situation in Southeast Asia requires a differentiated assessment. In Singapore, the results of government initiatives with the objective of slowing growth are uncertain. By contrast, growth is predicted in Thailand, Vietnam and Indonesia. Quite a varied picture is also to be seen in the Middle East/Africa region: stagnation in the United Arab Emirates, a continued positive development in construction activities in Saudi Arabia and Qatar and another difficult year in South Africa.

Raw materials

Raw materials prices have undergone very volatile development in recent years. In 2011, despite another increase in prices in the first six months, the situation in the raw materials markets has stabilized. Predictions about the development for 2012 as a whole are difficult. At least for the first two quarters, stagnating prices at a high level are expected for the industrial metals and plastics relevant to Geberit.


Great challenges for the Geberit Group, can be expected in 2012 due to exacerbated economic and political conditions. The objective, not only in the construction markets that are still healthy, but also in those that are shrinking, is to provide convincing market performances and to continue to gain market shares. The focus in this connection will be on the concerted marketing of the products newly introduced in recent years, on various organic growth initiatives and on the very promising shower toilet business. Parallel to this, in accordance with the Company culture prevailing at Geberit, the optimization of the business processes should be pushed forward. Management is convinced that it is very well equipped for the coming tasks. With experienced and highly motivated employees, a series of promising products that have been launched in recent years and other product ideas for the more distant future, a lean and market-oriented organization, an established and faithful cooperation with the market partners in both commerce and trade and – as a result of the industry leadership in terms of financial results in recent years – an extremely sound financial base, Geberit looks to the future with confidence.