FRIWO AG

Latest Results (07.08.2024):

Revenue Decline

In the 2023 financial year, FRIWO AG reported a group revenue of 111.1 million euros, which was slightly above the forecast of 110 million euros but significantly below the previous year's revenue of 184.9 million euros. This decline was primarily due to weak demand and order cancellations in Europe, particularly in the e-mobility, industrial, and tools segments.

EBIT and Profit

FRIWO AG's earnings before interest and taxes (EBIT) for the 2023 financial year amounted to -7.4 million euros, compared to a profit of 4.3 million euros in 2022. The company faced a loss of 11.1 million euros after taxes, following a slight profit of 0.5 million euros in the previous year. The negative EBIT was influenced by a decline in sales, structural adjustments, start-up costs for the Indian joint venture, and negative currency effects.

Cost Adjustments

To address the market weakness, FRIWO AG reduced its headcount from 2,501 to 1,701 employees by the end of 2023. The company also made extensive adjustments to its production activities, including selling production activities at the Ostbevern site and acquiring assets and materials for component production near Saigon. These measures are expected to further reduce the workforce by more than 500 employees.

Balance Sheet Impact

FRIWO AG's total assets decreased from 105.0 million euros at the end of 2022 to 74.3 million euros by the end of 2023. The equity ratio fell from 23.7% to 17.1%, and working capital was reduced to 28.9 million euros. Despite these challenges, the company is solidly financed until the end of 2025, thanks to the extension of existing syndicated and shareholder loans.

2024 Outlook

For the 2024 financial year, FRIWO AG is cautiously optimistic, expecting a significant recovery in demand in the second half of the year. The company forecasts group revenue to be in the range of 100 to 120 million euros and aims to achieve a break-even Group EBIT. The first earnings contributions from the Indian joint venture and the easing of material prices and energy costs are anticipated to positively impact the financial results.