PAUL HARTMANN AG
Heidenheim
- Healthcare markets are reduced by the consequences of the pandemic and inflation
- Significantly higher material, transport and energy costs weighed on the result
- Transformation program was completed with investments i. hv EUR 180 million in a focused manner and is already making a significant contribution to profitability with EUR 100 million
The 2022 fiscal year was characterized by a tense economic and geopolitical situation for the HARTMANN GROUP and the entire healthcare market: the Russia-Ukraine war also caused material, transport and energy costs to continue to rise significantly, as well as risks in the energy supply. Global supply chains remained unstable. Across Europe, the coincidence of Corona with infectious diseases on the rise again caused high levels of sick leave in the health sector, which lacked nursing staff. The number of operations thus remained well below the pre-corona level. In addition, inflation caused reduced purchasing power, which had a strong impact on the development of prices and demand for consumer goods.
HARTMANN acts decisively
For all new challenges, HARTMANN took quick and comprehensive measures. Through targeted price adjustments and logistics optimization, the company was able to partially offset the additional material and energy costs. Rapid investments in infrastructure largely reduced dependency on Russian gas. In addition, the company invested in security of supply for its customers and increased its stocks significantly, despite the costs of storage, logistics and financing.
Slight organic sales decline reflects market development; Significant burdens due to increases in material and transport costs
The sales of the HARTMANN GROUP in 2022 were EUR 2,311.6 million. Overall, HARTMANN recorded a slight organic decline in sales of -0.8%. The adjusted EBITDA was EUR 190.8 million (previous year: EUR 240.6 million), the adjusted EBITDA return was 8.3%.
- Incontinence Management segment: The ranges for outpatient care developed positively. In addition, the product volumes in nursing homes and clinics increased due to a renewed increase in bed occupancy. However, the reporting year was characterized by significant increases in raw material and transport costs, which could only be offset to a limited extent through cost savings and price adjustments.
- Wound care segment: The strategy of gaining market shares in modern wound care with innovations was successfully continued. In traditional wound care, the position as a strong market leader was maintained. All in all, HARTMANN is number 1 in wound care in the European pharmacy market.
- Infection management segment: The hand disinfection market in hospitals is below the pre-corona level and below the previous year, combined with high inventories at customers. This caused a drop in sales. The boom in examination gloves is over and increases in material costs could only be partially passed on to customers.
- Segment Complementary Divisions of the Group: Like the KOB Group, the CMC Group achieved organic sales growth – at CMC mainly due to an increase in the selling prices of cotton wool products, at the KOB Group due to a positive development in compression bandages. In 2022, the KNEIPP Group faced a shrinking market for Baden and an inflation-related shift away from branded products. The complementary divisions were only able to pass on a small part of the strong cost increases to their customers.
Transformation program makes a major contribution to profitability
Despite the difficult market situation, HARTMANN pursued the transformation program launched in 2019 with undiminished commitment. Up to and including 2022, with a total of EUR 100 million, it already made a very high contribution to HARTMANN’s profitability, which provides crisis resilience in the difficult market situation. At a good EUR 180 million, investments in the reporting year were around twice as high as before the start of the transformation program and will enable further earnings contributions in the future. HARTMANN invested in product innovations and production facilities and implemented structural changes to improve competitiveness.
Dividend to remain at EUR 8.00
HARTMANN is sticking to its longstanding principle of a dividend policy geared towards continuity and is proposing a dividend of EUR 8.00 per share.
2023: Focused continuation of the transformation program; Investments remain at a high level
HARTMANN plans further high investments in 2023. A significant proportion of this goes to the largest plant for incontinence products in Herbrechtingen. In addition to the investments already announced in 2022 i. hv around EUR 40 million for a new production line and the infrastructure, it was decided at the beginning of 2023 to invest EUR 20 million in another high-performance plant and additional infrastructure measures. The investments strengthen the Herbrechtingen site.
The economic and geopolitical conditions remain challenging for the European economies and their healthcare industries: the number of unprofitable hospitals is increasing in Germany. Unabated pressure on the consumer business is to be expected. Significant increases in wages and salaries are expected to compensate for inflation. In addition, HARTMANN will no longer benefit from the favorable purchasing contracts that expired at the end of 2022.
Against this background, price adjustments will also be necessary in the current year. The transformation program will make significant, sustainable and positive contributions to earnings. However, these will not be able to fully compensate for the additional costs to be expected and the currently lower demand for products in the short term. HARTMANN therefore expects adjusted EBITDA to fall between EUR 145 million and EUR 185 million in 2023. At the same time, the company expects moderate organic sales growth for the 2023 financial year.
Britta Fünfstück, CEO of the HARTMANN GROUP: “We will continue the transformation program in a consistent and focused manner and this year we will introduce a range of innovative and cost-efficient products that offer our customers added value. We are convinced that the significantly positive earnings contributions of the program will become visible when the demand and purchasing markets recover. With We will be a strong partner for our customers with passion and commitment, especially in these challenging times.”
Click here for the Annual Report 2022: Investor Relations of PAUL HARTMANN AG.
Press contact:
Stephanie Reuter
PAUL HARTMANN AG
Phone +49 7321 36 13 93
Email: [email protected]
Original content from: PAUL HARTMANN AG, transmitted by news aktuell
