V-ZUG Increases Profitability Amid Market Challenges in 2023

V-ZUG Holding AG reported a challenging financial year in 2023 with net sales down 8.0% to CHF 585.4 million from CHF 636.3 million the previous year. Despite lower sales volumes impacted by inflation, rising interest rates, and decreased demand, the company successfully increased its gross profit through targeted cost management and strategic sales initiatives. Notably, V-ZUG achieved a 63.1% increase in its operating result (EBIT) to CHF 16.8 million and significantly improved its free cash flow to CHF 18.2 million from a negative CHF –52.2 million in the prior year.

The company's EBIT margin rose to 2.9%, with the group net result also increasing by 47.2% to CHF 11.7 million. V-ZUG attributes these improvements to price increases, avoiding high-cost purchases, stabilizing purchase prices, and implementing cost-saving measures. During the second half of 2023, operational efficiencies, process optimizations, and a reduction in workforce further enhanced profitability.

V-ZUG continues to invest in market positioning, production, and innovation, despite anticipating ongoing challenges in the market environment for 2024. The company has also focused on sustainability and operational improvements, including the commissioning of Europe's most advanced refrigerator factory in Sulgen and launching initiatives aimed at simplifying processes and improving quality.

For 2024, V-ZUG remains cautious about the market outlook but is committed to its medium-term targets. The Annual General Meeting will discuss the proposal of not distributing a dividend for the 2023 financial year, considering the market difficulties and ongoing high investment demands.