DAVY VIEW

Geberit had a solid Q1 with constant currency revenues up 1.5% year-on-year. However, COVID-19 will clearly impact trading to a much greater extent from April onwards. Even still, it is instructive that the group is not planning to compromise with any measures that may harm its future potential. Not reducing R&D is an example of this. History suggests that Geberit will outperform in a downturn as its core strengths come to the fore. These include its very healthy financial position, the group’s free cash flow generation capabilities and the resilience of its margins.