John Revill

ZURICH, (Reuters) – Geberit plans to raise prices in 2019 as it tries to address “an unprecedented increase” in raw materials costs that has hit construction industries. The Swiss manufacturer of plumbing products said Wednesday.

As its bathroom products like pipes and ceramics, which are widely used, the company was seen as representing the larger construction industry. The company had already implemented an unusual price hike in January as well as an annual price rise for April.

Christian Buhl, Chief Executive Officer of the company said that due to expected price increases in raw materials we would implement an extraordinary price rise of at least 7.5% starting July.

It would add to the January price hike of 1.5% and April’s 2.5% increase.

Geberit stated that it anticipates its raw materials to be 10% more costly during the second quarter than the first three months, which would make them 28% more expensive over a year ago.

This company is not the first to raise concerns about increasing input costs such as energy and metals. Reuters reports that Italy has set aside 7 billion euros ($7.35 Billion) to support construction firms in the face of spiraling costs.

The company lost 5% of its operating profit in the first quarter due to higher input costs.

Buhl claimed that although the company was capable of finding the raw materials needed for its products, it faced challenges.

“Every week, we face a new challenge,” said he. It’s not a short list, some of it smaller like pallets but the challenge is all-encompassing.”

He said that demand for both new builds and renovations was strong despite rising prices and higher interest rates.

Additionally, the company plans to launch a share buyback program of as high as 650 million Francs. This programme will begin in the last quarter.

($1 = 0.9796 Swiss francs)