Financial Reports

Well-equipped to navigate a world of uncertainty

2023 proved to be an unpredictable year with geopolitical, economic and climatic uncertainty. It was also a year in which the trade was adjusting back into a post-Covid rhythm. This reset was driven by several factors but notably destocking from 2022 inventories and cautious consumer spending. Combined, these effectively shrank the market for all manufacturers significantly in the first semester, although in the second semester some recovery was seen, particularly in the mass market channel, where pricing is lower. Despite such challenging trading conditions, STIGA once again demonstrated the resilience of the Group, its people, customer base and supplier network by navigating the year profitably. 

As I reflect upon the past 12 months, I would note that the Group’s operational flexibility has allowed us to manage through the rapidly changing market. Our manufacturing presence in Europe has provided customer lead time advantages and allowed us to manage working capital efficiently. In addition, I am pleased with the progress we’ve made on our strategic imperatives and STIGA brand. Our investment in research and development continues to add quality and breadth to our portfolio, creating value with intelligent and technologically advanced products.

Investing to accelerate sustainable Innovation for growth

In the first four months of the new fiscal year, developments are positive. The destocking cycle seen in 2023 is winding down across the entire market and consequently our order intake rate since January is higher than the previous year and is continuously growing, now standing at +25% year on year. The first data on sell-out shows a performance which is better than 2023 and market share gains. These two facts affirm management expectations to deliver Q2 sales at a level which is much higher than in 2023.

The current geopolitical instability is not significantly impacting Group costs given adequate stock levels and our wide European manufacturing base. Management has taken a number of positive steps to drive further efficiencies in the cost base, while working capital absorption has been materially reduced. 

All in all, management expects there to be a material improvement in Group profitability for 2024, considering the full year effect of the actions taken to reduce the fixed cost base and excluding the high non-recurring costs born in 2023, the overall result on a pro-forma basis would return profitability percentage on net sales to be higher than 2022.

Our R&D programme builds upon our technical leadership. In 2024 we launched an additional 5 models of autonomous robot in differing price sectors with a very encouraging reception and placement taken in traditional dealers as well as mass market channels. We also launched a range of 20v handheld tools that recharge during storage, a unique functionality on the market. In addition, we are extending our technology further with a greater level of own designed/made components.

I am confident about what lies ahead. Our talented workforce, best in class technology and data provided by connected devices will all combine to produce a stronger business in the months and years to come. Our Business Plan includes a new range of connected and autonomous products, deepening further our knowledge and insights into the market and consumer behaviours. New distribution channels and market expansion are opportunities for further growth. Our goal remains to be the brand of choice by helping people nurture their patches of green with intelligent products, made to the highest of standards, using materials and process sympathetic to the environment. This underscores our intent to keep sustainability at the core of STIGA’s strategy in the future.

Thank you for your continued support and trust.

Sean Robinson

CEO

STIGA’s most significant results in 2023 include:

 

• Sales registered -29% vs. 2022, mainly in France, UK and Germany. Battery products represented 10% of total sales (7% in 2022).
• EBITDA was EUR 33.6 million (-48% vs. 2022), due to lower sales in a contracting market. Operating costs were affected by a number of non-recurring cost items. Considering the non-recurring costs born in 2023 and the full year effect of fixed cost reduction actions, the overall profitability of the year on a pro-forma basis would have been EUR 48.0 million, with a percentage on net sales higher than 2022.
• Net Financial Position was EUR -112.1 million, +23.1 million vs 2022 (+17%), driven by the decrease of Trade Working Capital due to reduction of receivables, better cash collection and optimisation of stock levels.
• The countries served in the world increased by 3, up to 92, confirming our ability to enlarge our Export business.
• Average employees decreased by 374 Full Time Equivalent (-22% vs. 2022), mainly in Slovakia, China and Italy, due to lower production quantities and to the implementation of a new organisation structure.
• Capex at EUR 12.3 million was EUR 5.1 million lower than 2022, still allowing the continuation of the R&D programme of investments aimed at developing innovative products and enlarging the range of battery products.
• The management and leadership team remain optimistic for the future trading given the increase on branded sales, higher level of robotic technology, future proofed, complete electrified range and new dealer commercial policy in place for 2024.

Leading through change with purpose

2023 was another year marked by unpredictable events. Against this shifting background, STIGA increased the ability to drive business results in a responsible way, placing sustainability at the heart of the Group’s imperatives and goals. As our impact on people and the planet grows, we have a significant opportunity to work in harmony with nature. In 2023, we continued to make progress on our ESG agenda, inspiring us to keep improving our efforts in the future.

Sustainability is at the core of STIGA’s work, supported by a uniquely in-depth understanding and passion for the science of grass. It’s our purpose to make gardening a pleasure, and to help people make their own patches of green healthy and happy places. We understand the joy and the benefits that green spaces bring to our everyday lives, and we want to keep turning this knowledge into action. We are on course to reach, and in some cases exceed, our ESG targets. Our ESG Committee continues to keep our current projects on track and to oversee the launch of new opportunities. The Group has long-term goals to lower our carbon emissions, respect nature and contribute positively to people’s lives.

From a product perspective, we will promote our battery and electric-powered products as one of the pillars of our ESG strategy, using these greener power sources across a broad range of machines and equipment in every category. We also want to make our facilities more sustainable: we are proud to share that the majority of the electricity used by our plants and offices now comes from renewable sources, and will increase the percentage of self-produced energy at our production plants.

Our sustainability ambitions also involve moving towards a circular business model. This includes incorporating additional environmental considerations into the Research & Development processes by devising ways to make it easier to repair or service a product, including its battery. STIGA places great importance on creating and maintaining a positive and proactive work environment, which is why we’ve increased the options for our people to seek career development and training opportunities, while growing our partnerships with schools, universities and learning organisations.

Finally, I am pleased to announce that from 2024 STIGA will be a member of the UN Global Compact — a special initiative of the UN Secretary-General that calls on companies to align on the Ten Principles of human rights, labour, environment and anti-corruption. 

Looking to the future, we will continue to improve as we grow. As the Group progresses with its conscious initiatives, we look forward to playing our part in giving back what the planet and its people deserve. The opportunities and responsibilities ahead of us are challenging, but we are committed to making a significant difference.

On behalf of the Board, I thank all our partners and stakeholders for the enduring trust and support they have shown us.

Rainer Schmueckle – Chairman