In the first half of this year, GF's business continued to perform well, despite heavy currency headwinds and geopolitical tensions. Sales of sustainable products and solutions, underpinned by long-term megatrends such as urbanization, energy efficiency and high demand for clean drinking water, continue to sustain performance and profitability.
GF's solid financial position and global footprint, as well as the successful implementation of its Strategy 2025, are positioning the company well to weather expected recessionary trends in the global construction industry, subdued gas utilities in Europe and weaker ICT markets in Asia.
GF continues to actively drive innovation and sustainability. In April, it inaugurated two production sites in Shenyang and Yangzhou (both in China) that combine state-of-the-art production technology and the highest environmental standards in the production of lightweight car components and innovative piping systems. In Switzerland, GF officially unveiled its completely refurbished headquarters in Schaffhausen in June, featuring a modern, open space office, high sustainability standards and plenty of room for collaboration and innovation.
Through its Clean Water Foundation and long-standing partner Water Mission, GF was also able to quickly mobilize financial and material aid in early 2023 for survivors of a devastating earthquake in Turkey, helping increase access to clean water.
Corporate results
Sales amounted to CHF 1'961 million (2022: CHF 1'971 million), slightly below the previous year's level. This represents solid organic growth of 7.5%, supported by strong global demand for sustainable solutions. Negative currency effects had a substantial impact of CHF 123 million, partially offset by price adjustments.
The operating result (EBIT) rose to CHF 184 million, with a corresponding EBIT margin of 9.4%. In the first half of 2022, these were CHF 179 million and 9.1%, respectively. Net profit attributable to GF shareholders amounted to CHF 123 million, compared with CHF 125 million in the first half of 2022. Free cash flow came in at minus CHF 131 million (2022: minus CHF 37 million). Before acquisitions/divestments, the free cash flow was minus CHF 66 million (2022: minus CHF 98 million).
All three divisions were able to generate value in the first half of the year. The shift toward less cyclical businesses makes GF Casting Solutions and GF Machining Solutions in particular more resilient.
GF continues to jointly report financial and non-financial KPIs, underscoring the importance of a holistic business approach to both financial success and sustainability. GF is on track to reach its ESG targets for the year, including total sales with social and environmental benefits, a reduction in CO2 emissions, a reduction in waste and water intensity, as well as its targets for diversity and inclusion. In April 2023, GF was again included in “the top 100 companies globally” in the third edition of Europe's Climate Leaders – a listing by the Financial Times of the companies that are leading the way in tackling the negative impacts of climate change.