EQS-News

FRIWO achieves guidance in the 2023 financial year – return to profitability in 2024 and clearly positive momentum expected for subsequent years - Seite 2

“The 2023 financial year was a very difficult one for FRIWO, which was characterized by a massive drop in demand as well as order cancellations in the core European market. We reacted immediately, significantly reduced costs and staff and massively streamlined our production structures. As a result, we got off lightly and, against the backdrop of a market recovery expected in the second half of the year and the first positive earnings contributions from our Indian joint venture, we expect to return to profitability in the course of 2024,” comments Rolf Schwirz, CEO of FRIWO AG, on the development.
 

Cost flexibility increased and headcount reduced by around a third

Despite initial signs of stabilization at the start of 2024, the market saturation for electric bikes in Europe continues to shape developments. Both the order intake of 80.7 million euros (end of 2022: 156.2 million euros) and the order backlog of 49.6 million euros (end of 2022: 83.6 million euros) as at December 31, 2023 were clearly down on the previous year. FRIWO has responded to the market weakness and adjusted the number of employees in the last 12 months from 2,501 to 1,701 as at December 31, 2023. More than 80% of employees work at the production facilities in Vietnam. FRIWO has made extensive adjustments to its production activities since the beginning of 2024. With effect from March 1, 2024, the production activities remaining at the Ostbevern site were sold to an associated company. In addition, assets and materials for component production near Saigon have just been acquired by a Hong Kong company. Both acquirers will act as suppliers for the products and system solutions manufactured by FRIWO in the future. Overall, these transactions will lead to a further reduction of more than 500 employees.

 

Balance sheet structure characterized by weak demand

The decline in business development also led to a significant reduction in total assets from 105.0 million euros at the end of 2022 to 74.3 million euros. The equity ratio fell from 23.7% to 17.1% and working capital to 28.9 million euros. Thanks to the extension of the existing syndicated loan and shareholder loans at the end of 2023, FRIWO is solidly financed until the end of 2025.