Statement of the Board of Directors
Accelerated sustainability efforts to contribute to the transition to a low-carbon economy
Launched the Top Speed 23 program to get future-ready faster
In 2021, the COVID-19 pandemic kept affecting our environment in unprecedented ways. Schindler employees around the globe continued to focus on keeping cities moving and delivering value for our customers. Once more, they deserve all the credit and gratitude for their unwavering efforts.
Markets recovered at varying speeds, with some showing unexpected resilience and others dropping back after an initial recovery. Severe supply chain disruption, electronics shortages, exploding material cost inflation, construction site delays, and persistent currency volatility created an extremely complex set of challenges.
We continue investing for the future to keep creating efficient, seamless mobility solutions across all dimensions of urban spaces.
Our financial results reflect growth while margin pressures persist. Order intake increased by 10.4% to CHF 12 166 million, corresponding to 10.6% in local currencies. Revenue rose by 5.6% to CHF 11 236 million, equivalent to 5.7% in local currencies. Adjusted operating profit reached CHF 1 252 million, corresponding to an EBIT-adjusted margin of 11.1%. Net profit amounted to CHF 881 million, and cash flow from operating activities reached CHF 1 314 million.
Thanks to our financial strength, we are able to continue investing for the future to keep creating efficient, seamless mobility solutions across all dimensions of urban spaces. In particular, by tapping into the fast-expanding demand for digitization and decarbonization, we play our role in making cities more people-centric and green.
Top Speed 23 program
We launched the Top Speed 23 program to accelerate digital transformation, boost product innovation, and address profitability gaps. The aim thereby is to create an industry-leading customer experience, to strengthen the company’s position in key markets, and to further integrate sustainability into our business model. The program is set to be completed by end 2023, with incremental cost of up to CHF 270 million. It focuses on digitizing our entire value chain, accelerating mass connectivity, building an integrated digital service offering, and introducing new, eco-friendly products, and upgrading processes to make Schindler more efficient.
Our contribution to climate action
Over the past twelve months, we have accelerated our sustainability efforts and increased resources to do our part in the transition to a low-carbon economy. While progressing with the six priorities we set ourselves back in 2017, we also committed to set science-based targets. In this context, we defined a full transition to renewable electricity by 2025. To underline this pledge, we have joined “RE100,” the global environmental initiative led by the Climate Group in partnership with the Carbon Disclosure Project (CDP). In addition, we set ourselves a “no waste to landfill” target across all our sites globally by 2023.
On the reporting front, we adopted the Sustainability Accounting Standards Board (SASB) metrics for the first time in our latest Corporate Responsibility report. We have also started to implement the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).
From product complexity to modular platforms
In 2021, the global rollout of our first platform of modular elevators advanced but was impacted by issues disrupting our supply chain. This innovative, highly energy-efficient product range offers a seamless and interactive user experience structured around a streamlined component variance. Customer feedback from the first units installed continues to be very positive.
Improving travel experience in buildings
In the second half of 2021, we launched Schindler PORT 4D, the latest version of our leading transit management solution, optimizing travel times via a proprietary smartphone app connected to our elevator systems. Schindler PORT 4D reduces the energy consumption of an elevator group by up to 40%. To accelerate further co-creation of new user experiences with our customers, we have expanded our CoLab Application Programming Interface (API) to allow architects and planners to integrate hardware and software interfaces for extended functionality, such as face recognition, robotics, and digital entertainment.
BuildingMinds, our Berlin-based “Software as a Service” (SaaS) start-up bringing to market digital real estate management solutions, launched new products to assist our customers in their efforts to decarbonize urban spaces.
In 2021, BuildingMinds became a partner of GRESB, the leading global ESG reporting tool for the real estate sector. The resulting exclusive, automated data exchange enables BuildingMinds users quick and easy sustainability-related reporting specifically designed for the real estate industry and sets the base for AI-based decision-making.
Profit and dividend
Schindler Holding Ltd. closed the fiscal year 2021 with a net profit of CHF 689 million (previous year: CHF 615 million). The Board of Directors will submit a proposal to the forthcoming General Meeting of March 22, 2022, for a dividend of CHF 4.00 per registered share and per participation certificate.
Looking ahead, increasing material cost inflation, persistent foreign exchange pressure, supply chain disruptions and construction site delays, as well as global markets recovering at various speeds will continue to affect our business. In response, Schindler is set to increase prices across all products and regions in 2022, which, however, is not expected to fully offset surging costs. Also, the Top Speed 23 program will be sharpened, with expenses expected to reach up to CHF 150 million during the year.
For 2022, barring unexpected events, the company’s revenue growth is expected to reach levels between 1% and 6% in local currencies, with margin pressure to continue. For the first and second quarter 2022, Schindler expects slow revenue growth and a significant drop in profitability.
As in previous years, net profit guidance will be provided in combination with the publication of the half-year results.
We are very grateful to our customers for their business and for their continued confidence in our products and services. Together we keep cities moving. We would also like to thank our shareholders for their trust and for their essential support to the company, as well as our employees for their exceptional engagement in the challenging times we are experiencing.
Chairman of the Board of Directors
Prof. Dr. Pius Baschera
Vice Chairman of the Board of Directors