Forbo Holding AG Reports Business Performance for 2023

Forbo Holding AG, a leading producer of floor coverings, building and construction adhesives, and power transmission and conveyor technology, disclosed its financial results for 2023. Despite a challenging economic environment, the company generated CHF 1,175.2 million in net sales, witnessing a 2.9% decline in local currencies and a 9.1% decrease in corporate currency due to adverse currency effects. Operating profit (EBIT) slightly fell by 2.0% to CHF 129.9 million, while the group profit increased marginally by 0.9% to CHF 102.3 million. The company reported an impressive double-digit EBIT margin and a substantial rise in free cash flow to CHF 115.9 million.

The geopolitical and macroeconomic conditions worsened in the latter half of 2023, leading to reduced consumer demand and lower sales volumes. Forbo responded by enhancing profitability and efficiency across its operations, including implementing price adjustments and optimizing personnel and energy costs. These initiatives helped mitigate the financial impact of inflation and continued high energy prices.

Despite these challenges, Forbo's divisions witnessed mixed results. The Flooring Systems division experienced a slight dip in sales, while the Movement Systems division reported a 2.6% decrease in local currencies. Nonetheless, both divisions undertook various measures to navigate the tough market conditions and protect profitability. Additionally, the company strengthened its balance sheet, achieving a solid equity ratio of 61.4% and doubling its free cash flow since the previous year.

Forbo aims to continue its growth trajectory in 2024 by focusing on product and service offerings, operational excellence, and sustainability initiatives. Despite the uncertain market outlook, the company is well-positioned to leverage its robust financial foundation and strategic investments for future growth.