ACTONA GROUP A/S DELIVERS STRONG RESULTS IN TURBULENT TIMES
The furniture company, Actona Group, presents a +10 percent increase in revenues despite the global repercussions of covid and disruptions in global supply chains caused by the war in Ukraine. It is the company’s second best result ever, only exceeded by the financial year 2020/21.
In the financial statement for the fiscal year 2021/22 Actona Group delivers a turnover of DKK 2.7bn and DKK 225m in earnings before interests and tax, upon a series of non-recurrent expenditures such as acquisitions.
”I am proud of our results for the fiscal year 2021/22. We have grown our business by +10 percent in a global market under pressure. Most of all, the effort must be attributed to the many skilled and dedicated colleagues, who have navigated through challenges posed by covid as well as the war. It has required us to constantly and quickly adapt in very uncertain times. Concurrently, our colleagues have shown the greatest care and support for our afflicted colleagues in Ukraine, which really goes to show the strong values Actona Group is built on,” says CEO of Actona Group, Jimmi Mortensen.
In addition to the war, which has caused high price increases and scarcity of several raw materials, Actona Group’s trading business has been challenged by the pressure on supply chains and increasing freight charges.
"This also means that the derivative effects of the disruptions in the supply chain are likely to last a few years," Jimmi Mortensen assesses.
Maintaining a long-term growth strategy
Despite the global challenges, Actona Group is maintaining its long-term strategy, ”Sustainable Business”, to more than double the business and triple the bottom line, among other things through targeted acquisitions, which will provide the company with strong competences and strengthen future growth plans. Just one year into the strategy period, the first two acquisitions have been completed: The upholstery producer Theca, with production in Lithuania, in October 2021 and the furniture producer SITS in Poland, which Actona Group acquired in July 2022.
”With our goals and strategy we have set the bar high, but that is what powers us. We want to be in the top-three of the European producer and distribution market by 2025 and number one in the long-term. With the acquisitions of Theca and SITS, we are creating synergies on our business and our existing production facilities and thus creating possibilities for consolidation and optimising our platform for further profitable growth,” says Jimmi Mortensen.
Sustainability and social responsibility
Though faced by global challenges, Actona Group continues to work on making the production and business more sustainable through the UN 17 Sustainable Development Goals. Actona Group has chosen to focus specifically on the goals 7, 12, and 15, which will contribute to transforming the business and reduce emissions by 70 percent before 2030 and make the company carbon neutral before 2050.
Hence, Actona Group has not just accelerated financially but is focused on taking the lead in sustainability as well, which means that all of Actona Group’s own factories in Europe and Asia are certified in 2022. This contributes to the ambition of using solely certified wood in 2025.
Furthermore, Actona Group is experiencing great success with talent development of apprentices and trainees. During the last year, 90 percent of all apprentices and trainees have subsequently been permanently employed in the company.
The fiscal year 2022/23
The global volatility, increasing prices on raw materials, and decreasing consumer purchasing power are expected to affect Actona Group in the coming fiscal year. However, CEO Jimmi Mortensen maintains the long-term strategic goal of more than a doubling of the business to create a turnover of more than DKK 4bn and a margin of 12,5 percent in 2025.
”We have experienced a couple of years with a lot of change, which, all in all, has had a positive effect on our business. Now, we are looking into a couple of years, where we expect a more negative impact. We have a sturdy foundation from which we can navigate the short-term challenges and a great potential to reach our long-term goal of continued growth and further market shares in the global market,” Jimmi Mortensen concludes.
Actona Group's Acquisition of Theca is Now Approved by the Danish Competition Authority
In October Actona Group announced the acquisition of Theca, and now the acquisition has been approved. Theca is therefore officially part of Actona Group.
The acquisition strengthens Actona Group's position within the upholstery market and is a strategically important step in the company's ambitious growth strategy "Sustainable Business".
Consolidation of the Market and Activities
It is a mature market where there still are some challenges in the supply chain, which has increased over the past 18 months. “We see an opportunity to consolidate the upholstery market in Actona Group. With the acquisition of Theca, we get added competencies and capacity. We will also be able to create a synergy effect across the factories. The establishment of an upholstery division with a turnover of more than DKK 1 billion - which will be doubled during the strategy period - opens several new opportunities. We will be able to produce to a broader customer portfolio and cover even wider and better in the upholstery market", says CEO of Actona Group, Jimmi Mortensen.
Creating a Strong Upholstery Division
As of today, Claus Svenningsen, CEO of Theca, is responsible for the new upholstery division and joins the management team of Actona Group.
“Actona Group will have a very strong position within the upholstery market, and I look forward to working with Actona Group's existing upholstery factories and creating synergy with Theca's factories in Eastern Europe. To have a strong, wide-ranging upholstery division offers many opportunities, and I look forward to developing the area further,” says Claus Svenningsen.
Together Towards New Goals
In Actona Group's ambitious growth strategy, there is a strong focus on creating a stronger and more sustainable business. The acquisition and strengthening of the upholstery category are therefore a strategically important step, that not only creates a larger and more focused business, but also a business that actively takes responsibility for developing more future-oriented solutions and sustainable products.
In relation to creating more sustainable products, one of the first areas Actona Group will focus on, is wood. Wood remains to be an important material in the production of upholstered furniture. Therefore, one of Actona Group's goals is to exclusively use FSC-certified wood in its own production from 2025. By following the highest industry standards, Actona Group helps to ensure responsible forestry - now and in the future. As early as the beginning of 2022, sofas produced at all the group's own European factories will be fully FSC-certified.
Theca will continue to have headquarters in Risskov, Denmark, and the employees will continue to work from there. There will also be no changes in the sales organisations, as Theca and Actona will be sold as two separate brands, each with their familiar sales organisation behind them. Flexlux, which is Theca's well-known brand, continues as an independent brand.
Actona Group acquires Theca
Shortly after announcing a record result and the launch of an ambitious growth strategy Actona Group can now announce the acquisition of Theca. With the new acquisition Lars Larsen Group strengthens its position within the upholstery market.
Actona Group, which is a part of Lars Larsen Group, has just introduced its ambitious growth strategy ”Sustainable Business”.
One of the focus areas is a strengthening of the position within upholstery which is one of the three central business areas. The strengthening will be obtained through a combination of organic growth based on current factories in Ukraine and China and through focused acquisitions primary in Northern- and Southern Europe.
With the acquisition of Theca, Actona Group takes a major step towards creating a strong upholstery division with an expected billion DKK revenue.
Theca primary produces sofas and resting chairs and has their own factories in Lithuania and Belarus where more than 3.500 orders are produced weekly.
”The acquisition of Theca is the first in an expected number of strategically important acquisitions, which will both strengthen our innovative and production competences and upscale our capacity significantly” says CEO from Actona Group, Jimmi Mortensen and continues:
”Upholstery is the largest product category within the furniture market and therefore it is important for us to constantly grow through both acquisitions and organic growth”.
Theca is founded by Claus Svenningsen, who remains in the company and will be responsible for the new consolidated upholstery division at Actona Group.
”I am incredible pleased for the prompt settlement of the agreement and to be trusted the responsibility of the consolidated upholstery division, which contains a huge potential. Theca has always been an excellent production company with very proud craftsmanship traditions. This is now combined with the strong customer and market understanding of Actona Group” says Claus Svenningsen.
Till now he owned a third of Theca while Dansk Ejerkapital (former Industri Udvikling) and LTP Group likewise had a third of the ownership each. When the sale is completed, Theca will be 100 percent owned by Actona Group.
Prior to this, the sale must be approved by the The Danish Competition and Consumer Authority which all parties hope will happen promptly.
Actona Group has just announced key figures for FY21 and presents a revenue of 2,43 billion DKK, while the recent financial year Theca had a revenue of around 0,5 billion DKK.