UPDATE 2 - SGS sees more top-line growth, raises 2010 dividend
Monday, January 17, 2011 2:45am EST
ZURICH, Jan 17 (Reuters) - SGS (SGSN.VX), the world's largest inspection services company, raised its dividend and said it saw stronger top-line growth this year after demand for its minerals and consumer testing services picked up in 2010.
Global demand for testing, inspection and certification services is rising, supported by a trend for tighter regulation and for companies to outsource these services to specialists such as SGS, Bureau Veritas (BVI.PA) and Intertek (ITRK.L).
Full-year net profit at SGS rose 8.4 percent to 588 million Swiss francs ($610.2 million) and revenue increased 4.1 percent on a constant currency basis to 4.8 billion francs, said the group,
whose activities include checking toy safety and inspecting London's black cabs.
Top-line growth and operating performance are set to improve this year, said SGS, which raised its dividend to 65 Swiss francs, including a special payout of 35 francs, from 60 francs the previous year.
Shares in the group were indicated to open slightly higher, pre-market data provided by bank Clariden Leu showed CLPRE2.
"A solid set of results, however without any surprises," Vontobel analyst Jean-Philippe Bertschy said. "The outlook remains vague but the dividend payment proposal of 65 francs is clearly positive."
"The operating profit margin in consumer testing services was a positive surprise as well as top line and margin development in the minerals unit," he said, adding that environmental services and Life Science were disappointing.
SGS, which completed 10 acquisitions last year, recently boosted its automotive unit with a 180 million euro buy, a first step towards reaching its ambitious mid-term revenue growth target. [ID:nLDE6BC060] ($1=.9635 Swiss Franc) (Editing by Hans Peters)
Source; http://www.reuters.com/article/idUSLDE70C14N20110117
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