EQS-Adhoc: Sto adjusts and lowers its guidance on turnover and earnings for the fiscal year 2024 and announces that its communicated financial medium-term goals for the fiscal year 2025 and 2027 will not be met

Publication of inside information in accordance with Article 17 Regulation (EU) No 596/2014 (MAR)

 Sto SE & Co. KGaA, Stühlingen

ISIN: DE0007274136 / WKN: 727413

Sto adjusts and lowers its guidance on turnover and earnings for the fiscal year 2024 and announces that its communicated financial medium-term goals for the fiscal year 2025 and 2027 will not be met

Stühlingen, 24 July 2024 – The board of directors of STO Management SE as the personally liable partner of Sto SE & Co. KGaA has adjusted its previous expectation for the group turnover and earnings for Sto Group for the fiscal year 2024 downwards.

The adjustment is due to the general development in the construction industry, especially in its major single market Germany but also other important foreign markets falling below the expectations of Sto. As published by the German Federal Statistical Office permits for residential construction went down by 21.5 % in the period January to May 2024 compared to the previous year period. The insolvency and restructuring of real estate project developers resulted in a lower number of real estate projects. High interest rate levels, remaining on higher levels than expected at the last turn of the year, tense general financing conditions and especially uncertainties of potential investors as a result of uncertain legal frameworks and conditions for government subsidies supported a negative trend in the construction industry. Therefore, Sto does not believe in catch up effects for the current year 2024. In Italy cuts in the conditions for government subsidies for energetic measures lead to significant reservations towards investments, with a negative impact on course of business upon Sto’s subsidiary in Italy. Also, in China the expected stabilisation of the construction industry did not occur yet.

Further the course of Sto Group’s business was under the current year 2024 affected by negative weather conditions. Especially the months of May and June and the recent part of July, being normally months with a very strong turnover, outdoor works were hindered by very much rain in for Sto Group relevant markets. As a result, the course of Sto Group’s business was significantly weaker than assumed in the recent guidance for the fiscal year 2024.

Therefore, the board of directors of STO Management SE has in consideration of different scenarios by decision as of today decided to adjusted its recent guidance. At present the Sto Group expects a turnover in 2024 in the approx. amount of 1.66 billion EUR (previous forecast 1.79 billion EUR; 2023: 1.72 billion EUR). Consolidated earnings before interest and taxes (EBIT) are expected to amount within the corridor between 62 million EUR and 82 million EUR (previous forecast: between 113 million EUR and 138 million EUR; 2023: 126,5 million EUR) and the earnings before taxes (EBT) within the corridor between 63 million EUR and 83 million EUR (previous forecast: between 113 million EUR and 138 million EUR; 2023: 127.4 million EUR). The return on sales margin with respect to the earnings before taxes (EBT) therefore should amount between 3.8 % and 5.0 % (previous forecast: between 6.3 % and 7.8 %; 2023: 7.4 %). The ROCE figure is expected to lie in the range between 8.1 % and 10.9 % (previous forecast: between 14.5 % and 17.8 %: 2023: 17.1 %).

Reflecting the expected lower business development in 2024 the board of directors of STO Management SE currently expects that the communicated goals for the business year 2025 to a group turnover of 1.9 billion EUR and a return on sales with respect to the earnings before taxes (EBT) between 7.6 % and 9.2 % will not be met either. An updated and specified forecast for the fiscal year 2025 shall be announced with finalization of the Guidance 2025, latest in April 2025.

Sto estimates the tough current market conditions and the ongoing difficult framework conditions in the construction industry, especially in core markets for Sto, to be a contemporary phase only, that is temporarily overlying the per se positive growth factors for the products and components of Sto by current negative factors. As a result, the realisation of the significant chances for Sto Group with energetic solutions both for the construction and the renovation sector for buildings is expected to be delayed. Therefore, to the current understanding of the board of directors of STO Management SE, the published medium-term goals for the fiscal year 2027 (group turnover of 2.1 billion EUR and a return on sales with respect to the earnings before taxes (EBT) of 10 %) will till then not be met. An updated and specified forecast for the medium-term goals shall be announced with the finalization of the new medium-term planning for the period until 2029 in April 2025 for the latest.

The half year financial statements of Sto SE & Co. KGaA for 2024 for the period from 01.01.2024 to 30.06.2024 acc. to Sec 115 WPHG will be published on 29 August 2024 under https://www.sto.de/s/investor-relations.

Contact person at Sto SE & Co. KGaA:

Désirée Konrad, Chief Financial Officer of STO Management SE

Contact via phone: +49 7744 57-1241, e-mail: s.zeller@sto.com

Contact to the media:

Claudia Wieland, Redaktionsbüro tik GmbH,

Tel.: +49 911 98817071, E-Mail: info@tik-online.de

1953393  24-Jul-2024 CET/CEST