Financial commentary of Uwe Schiller (CFO)
Dear Readers
The year 2024 was characterised by the sale of the Climate Division (formerly HVAC Division) in that the new Arbonia focused exclusively on the doors business. Although the sale was protracted and the final closing thus did not take place until 26 February 2025, Arbonia used the time and prepared intensively for its future as a pure door manufacturer; it was able to assume market leadership for interior doors in continental Europe by opening up new markets and distribution channels through further acquisitions.
As in the previous year, the Climate Division is also reported as a discontinued operation in the consolidated financial statement for 2024, since the closing of the sale did not take place until 26 February 2025. In precise terms, this means that the result of the Climate Division is only included as a single line item in the group result of the Arbonia Group in the consolidated income statement on account of it being a discontinued operation. In addition, the assets and liabilities of the Climate Division are reported in the balance sheet as "Assets held for sale" and "Liabilities associated with assets held for sale" respectively.
General
The massive decline in new residential construction activity in Germany, Arbonia’s most important market, continued in 2024 as well. The main reasons for this were higher interest rates, a continuing shortage of skilled workers in the construction industry, as well as increasing material costs. At the same time, the increasing demand for housing in urban areas as well as the high net immigration helped to stabilise the renovation markets. Renovation activities in Germany recorded a slight increase, but at a low level due to the above-mentioned reasons.
Arbonia was able to reduce its dependence on the German market with the acquisition of the Spanish company Dimoldura in May 2024 and the Czech company Lignis in July 2024. In particular, it was possible to develop new markets in Spain, Portugal and France with Dimoldura and in Czechia with Lignis. Arbonia benefited from these growing markets, such as Spain, as well as those in Central and Eastern Europe.
In addition to opening up new distribution channels, especially in the DIY store sector, it was possible to strengthen and expand the contractor services business: Arbonia won an increasing number of major contracts such as hospitals, hotels, as well as public or private complexes. As a result, Arbonia has established itself in the contractor services business and can generate further growth in this sector.
All new installations in the production plants have been delivered, and the production is currently being optimised to increase efficiency. At the highly automated production plant in Prüm, Arbonia was able to commission a combined heat and power (CHP) plant in January 2025; the site uses this to generate a large portion of its own energy from wood waste and can thus sustainably reduce its CO2 emissions as a result. The CHP plant also makes a positive contribution to the energy costs.
In addition to focusing on the doors business, Arbonia was able to sell a non-operational property in Switzerland in the 2024 financial year, which led to an extraordinary profit of CHF 28.8 million. This sales profit and other one-time effects in connection with the Dimoldura and Lignis acquisitions as well as various personnel adjustments led to total one-time effects of CHF 24.6 million at EBITDA level.
The subsequent explanatory notes to the income statement and balance sheet focus on the continuing operating activities, i.e. primarily on the Doors Division. Where mentioned, the continuing operations are discussed without one-time effects for the purposes of illustration and comparison.
Profit and loss account affected by acquisitions and one-time effects
In the 2024 reporting year, Arbonia achieved a net revenue of CHF 556.3 million, which corresponds to an increase in Swiss francs of 10.2 % compared to the previous year (CHF 504.6 million), because of the acquisitions of Dimoldura and Lignis. When adjusted for currency and acquisition effects (organic), the decrease amounted to –5.4 %, which led to an improvement compared to the previous year (–8.2 %). The decrease is above all due to a continued decline in volumes resulting from the continued decrease in new residential construction activity combined with increasing average wage costs and negative exchange rates.
As a discontinued operation, the Climate Division achieved a net revenue of CHF 563.2 million in the same period, which represents a decrease compared to the previous year (–3.8%).
Arbonia reports EBITDA of CHF 66.3 million for 2024, which corresponds to an increase of CHF 34.4 million and is due on the one hand to the previously mentioned one-time effects totalling CHF 24.6 million. On the other hand, the acquisitions of Dimoldura and Lignis contribute to this with CHF 10.2 million. Adjusted for these effects, EBITDA amounts to CHF 31.5 million, which corresponds to a reduction of CHF –0.5 million or –1.5 % compared to the previous year’s EBITDA of CHF 31.9 million. Consistent cost management and operational efficiency contributed to the fact that the sales loss of –5.4 % resulted in an EBITDA reduction of –1.5 % when adjusted for currency and acquisition effects.
Depreciation and amortisation increased according to expectations due to the high investments in the past. The amortisation of intangible assets from acquisitions are increasing primarily due to the acquisitions of Dimoldura and Lignis.
The group result was positive in the financial year at CHF 8.3 million, which corresponds to an improvement of CHF 25.5 million compared to the previous year (CHF –17.2 million). This equates to a profit of CHF 0.12 per share (previous year: CHF –0.25 per share). The improvement is primarily due to the sales profit of CHF 28.8 million from a non-operational property.
Net working capital increased due to acquisitions
The net working capital at the end of 2024 amounted to CHF 51.0 million, which results in an increase of CHF 18.2 million compared to the same period of the previous year (CHF 32.8 million). This increase is mainly due to the acquisition-related increase in inventories of CHF 20.4 million. In total, Dimoldura and Lignis’ share of the net working capital is CHF 21.5 million. Adjusted for these acquisitions, it was possible to reduce the already low net working capital once more.
Cash flow and net indebtedness
The cash flow from operating activities is CHF 41.3 million, which corresponds to a reduction of CHF 59.7 million compared to 2023 (CHF 101.0 million). For the continuing operations, the cash flow from operating activities is CHF 37.4 million. This means a decrease of CHF 15.3 million compared to the previous year (CHF 52.7 million). The reasons for this are the significantly higher profit taxes paid as well as higher interest costs due to the increased financing requirements.
These investments continue to decrease compared to the previous year and amounted to CHF 50.1 million in 2024 (previous year: CHF 59.1 million).
The net indebtedness at the end of 2024 was CHF 357 million compared to CHF 209 million at the end of 2023. The increase of CHF 148 million is largely due to the acquisitions of Dimoldura and Lignis (CHF 135 million).
In 2025, the shareholders will participate in the proceeds from the sale of the Climate Division. The previously announced nominal value reduction of CHF 4.00 as well as the dividend for 2023 of CHF 0.30 per share will be proposed to the General Meeting for distribution. A dividend for 2024 of CHF 0.33 per share, as well as an extraordinary distribution of CHF 1.20 per share will also be proposed to the General Meeting for distribution.