Arbonia with challenging second half-year of 2022

Arbon, 12 January 2023 The financial year 2022 was challenging due to increased material and logistics costs, material shortages, a dramatic rise in energy costs, increased interest rates, and the Swiss franc significantly appreciating. In general, this situation did not ease in the second half-year of 2022 due to factors such as energy costs continuing to rise. 

The situation was made worse by a rapid destocking among all major customers in the fourth quarter of 2022. This significant and unexpected volume reduction, particularly affecting radiators, shower enclosures, and to some extent doors, resulted in the margin being negatively affected as a contrast to the strong performance that is normally seen in the construction industry during the second half-year. However, the growth businesses strategically built up in recent years (for heat pumps, ventilation units, underfloor heating and energy storage) performed in a positive manner, demonstrating high double digit volume growth in. 

Despite achieving organic growth of slightly above 5% resulting in revenues of around CHF 1.2 billion, the EBITDA margin without one-time effects will be around 9.5%.*

The price increases that were announced for both divisions due to the sharp rise in material costs were brought into effect during the second half-year of 2022, although the rapid increase in energy costs towards the end of the year had an additional impact on results. The raw material markets revealed a varying picture in which some material prices were able to stabilise at a high level, but overall the Doors Division did not see any easing of the situation, particularly in relation to wooden materials. Demand for single-family homes also dropped as a result of the situation of interest rates and construction costs. Due to the overall situation, the HVAC Division felt the strain of a huge volume reduction that came unexpectedly after a healthy first and second quarter of 2022; amounting to as much as 25%, this affected radiators in particular, steel panel radiators. Arbonia believes that the destocking which had a negative impact on the HVAC and Doors Divisions in the 2022 financial year will come to an end in the foreseeable future and that demand will return to the long-term trend.

Despite achieving organic growth of slightly above 5% resulting in revenues of around CHF 1.2 billion, the EBITDA margin without one-time effects will be around 9.5%.*

The long-term trends that are key to Arbonias strategy remain positive and stable, as confirmed by the high growth rates for the "new" products of heat pumps, ventilation, underfloor heating and energy storage. There is no change to the medium-term goals, published on Capital Markets Day 2021 and covering the period up to 2026. 

The annual results, the 2022 annual report, and an outlook towards the full year 2023 will be presented as part of the annual results presentation in Zurich (CH) on 28 February 2023.

Contact
Fabienne Zürcher
Head Corporate Communications & Investor Relations
T +41 71 447 45 54
fabienne.zuercher@arbonia.com