By John Revill
ZURICH (Reuters) -Plumbing supplies maker Geberit will continue its operations in Russia, even as it has closed a factory and an office in Ukraine, saying its ceramics and piping products were not included in the current Western sanctions.
The Swiss company, which makes plumbing products, is an unusual hold-out following decisions by a raft of Western companies to quit Russia following its invasion of Ukraine, and argues it is providing a "basic requirement".
Geberit has decided keep its Moscow office open, Chief Executive Christian Buhl said, although the company shut its Kiev office and a factory in Ukraine, a country where it employed more than 500 people.
"We have decided to maintain our business in Russia until further notice," Buhl told a press conference on the company's results. "Primarily to protect our 70 Russian workers, and also because our products meet a basic requirement."
Geberit's products could not be converted to military use, Buhl said, and the company will ensure its pipes, sinks and toilets are not supplied to companies on the Western sanctions list.
Russia and Ukraine combined contributed to around 2% of Geberit's sales, the executive said.
During its fourth quarter, Geberit reported a 22% drop in operating profit, after being hit by significantly higher raw materials costs at the end of the year.
Operating profit fell to 124.5 million Swiss francs ($134.19 million) in the three months to Dec. 31, as costs of metals and other raw materials rose by more than a quarter.
Net profit fell 26% to 102.4 million francs in the quarter, Geberit said. It proposed raising its full-year dividend to 12.50 francs, from 11.40 francs for 2020.
Geberit is a big user of metals like copper, zinc, nickel and aluminum, as well as plastics. The company sources virtually none of its raw materials from Russia and Ukraine, Buhl said.
($1 = 0.9278 Swiss francs)