The largest Polish manufacturer of household appliances generated a 22% YoY increase in gross profit in 2024 and increased sales profitability at almost every level. Amica Group (WSE: AMC) operated in a very demanding environment, facing a decline in revenue. The household appliance industry continues to feel the weakness of consumer demand in Europe, with a still high cost base for industrial companies, although at the same time the implementation of Amica Group's "Back to Profitability" strategy is bringing positive results.
In 2024, the Amica Group recorded nearly PLN 2.6 billion in revenue, with one third of household appliance sales being made on the Polish market, and its value increasing by 2% year-on-year. The remaining sales areas (Western Europe 42% of sales, East 11%, North 9%, South 5%) recorded double-digit declines. However, even despite the 9% y/y decrease in total consolidated sales, the Amica Group managed to increase its EBITDA margin to 4.9%, achieving PLN 125.4 million in profit at this level. In turn, the annual gross profit increased by 22% y/y, to PLN 28 million, which – taking into account the gross loss cumulatively after three quarters – well illustrates the positive picture of the Amica Group's achievements in the fourth quarter of last year. The company also recorded a significant increase in the annual consolidated net result, to PLN 13.2 million.
- The year 2024 was a time when the entire European household appliances industry experienced a recession, and the negative effects of weaker demand were reinforced by the high costs of raw materials and components and higher employee wages. We also had a negative impact on the blockade of the Red Sea for commercial shipping. Despite the adversities, we implemented a number of optimization initiatives that helped us generate satisfactory results. They are a good basis for implementing strategic assumptions for the coming years - says Jacek Rutkowski, President of the Management Board of the Amica Group.
- We are consistently working on working capital, taking care of our financial strength and a healthy balance sheet. We have achieved a RONA ratio exceeding 10% and achieved a gross margin of almost 24% on the sale of our own products. At the end of 2024, we recorded a safe net debt to EBITDA ratio of 0.8 and had almost PLN 128 million in cash despite PLN 37 million in investments and PLN 67 million earmarked for servicing and repaying external debt - adds Michał Rakowski, Vice President of the Amica Group for Finance.
As part of the implementation of the long-term "Back to Profitability" strategy, presented in September last year, Amica Group intends to achieve sales growth of over 7% annually from 2030 with an expected EBITDA profitability of 5% in 2027 and 7% in 2030+. The goal is also to increase the RONA (return on net assets) ratio to 14% in 2027 and exceed 17% in 2030+. The company intends to maintain the net debt to EBITDA ratio below 2 and increase the gross margin on product sales in 2027 to 25% and to 28% in 2030+.
In the new strategy, Amica's mission is to offer durable and reliable household appliances with the highest quality service in order to make everyday life easier for consumers, respecting local traditions and the heritage of strong local brands (Amica, Fagor, Gram, Hansa, CDA). The vision of the Amica Group is to become the most recommended brand of heating equipment in key markets in Europe. The company intends to focus on sales in European countries, with the planned development of sales in individual geographical markets to be implemented based on sales and marketing strategies dedicated to specific areas. Amica has developed a product strategy and post-purchase experiences to clearly gain in the eyes of European consumers, and at the same time has identified product, operational and financial factors thanks to which it intends to become a preferred B2B partner.
The company focuses on broadly understood quality, consumer satisfaction and production efficiency, assuming an increase in production volumes at the heating equipment factory in Wronki by approximately 65% compared to the current level. Issues related to HR and organizational culture, including engagement, support, attracting and developing talent, are also a strategic pillar.
The Amica Group is also implementing the ESG strategy "Action for Climate", presented in December 2022, which sets social and management goals for 2025 and 2030, as well as environmental goals for 2040 and 2050. In January 2024, Amica increased production efficiency by launching a cogeneration installation (simultaneous production of heat and electricity). Meanwhile, the special purpose vehicle Amica Energia, registered in April last year, is primarily focused on developing photovoltaic installations. Over the next two years, it intends to acquire land in the form of a lease and obtain the necessary administrative decisions for a photovoltaic farm with a capacity of at least 30 MWp.
In 2024, Amica Group employees took part in the second edition of the Amica Group Sports Challenge, collecting kilometers while practicing various sports disciplines, which were converted into funds donated to charity. Aid in the form of household appliances was provided to flood victims from the Lądek-Zdrój commune and the Spanish province of Valencia. Amica equipment was also available to those most in need, victims of the explosion of a tenement house in Poznań's Jeżyce district. One of the traditional initiatives in which Amica employees are involved is the "Gift of the Heart" campaign organized by the Amicis Foundation, as part of which over 1.1 thousand packages with food products and toys were delivered to those in need before Christmas.
The Amica Group is the largest Polish manufacturer of household appliances and one of the most renowned Polish companies listed on the Warsaw Stock Exchange. Its offer includes a full range of large and small household appliances, distinguished by their usability, quality, appearance and innovation. The Group obtains approximately 75% of consolidated revenues from the sale of products and goods thanks to its activity on approximately 70 foreign markets. Amica has won many prestigious awards, both Polish and international, including the Red Dot Design Award: Best of the Best. The Amica Group's brand portfolio also includes foreign brands Gram, Hansa, CDA and Fagor.