Fedrigoni 2023 Annual Report: despite market volatility and a 11% drop in revenues, the group increased its market shares in all geographies and business segments

The Fedrigoni Group – one of the world’s leading players in premium labels and self-adhesive materials, special papers for luxury packaging and other creative solutions, and RFID and connected solutions – closed 2023 with pro-forma turnover of €1.81 billion (including the 12-month contribution of Tageos and Arjowiggins China and excluding the office business, which is currently for sale), down 11% compared to the record results of 2022 (€2 billion calculated on the same perimeter) but with rising margins.

Pro-forma EBITDA in fact rose 8% from €314 million in 2022 to €338 million in 2023 (with an EBITDA margin from 15.4% to 18.7%), proving the company’s solidity and profitability despite declining sales and volumes in both of its businesses. The pro-forma revenue figures include the 12-month contribution of Tageos and Arjowiggins China and exclude the office business, which is currently for sale.

One of the key factors in the growth strategy is the Group’s increasingly global scale, both in terms of presence of offices and production sites in 28 countries and in terms of revenue diversification, 21% from the Italian market, 49% from the rest of Europe and 30% from the rest of the world.

2024 started with signs of optimism
The first quarter recorded growth in volumes in both business units with estimated revenues of €470 million, up 10.9% compared to Q4 2023 and 2.4% from Q1 2023. Estimated EBITDA is €81 million, up 5.7% from Q4 2023 and 16.9% from Q1 2023. Also positive are the results for the last 12 months (April 2023 to March 2024) where the Group estimates pro forma revenues of €1.825 billion, pro forma EBITDA estimated at €356 million and an EBITDA margin of 19.5%.

“2023 was a year of great volatility, driven by a combination of geopolitical instability, excess inventories in many value chains and an unfavorable macroeconomic context, comments Marco Nespolo, CEO at Fedrigoni Group -. Nevertheless, we continued to gain market share in all sectors and geographies, closing the year with stable financial results, and we once again demonstrated the resilience of our business model. The agility of our processes and our focus on innovation, sustainability, product excellence, customer proximity and the acquisition of new skills and technologies, supported by the experience and passion of our people, have enabled us to further strengthen our position as a reference global player. Looking ahead to 2024 – adds Nespolo – the first quarter got off to a positive start, with a recovery in demand. However, we are still in a highly volatile market environment with great geopolitical instability due to world conflicts in which agility and adaptability remain crucial: we expect that this schizophrenic market trend will characterize the next few years, with big fluctuations in orders, hence much more flexibility will be needed”.

The great focus on the industrial plan has led Fedrigoni not to retreat one step on its growth strategies, despite the slowdown in demand last year. In fact, between the end of 2023 and the first months of 2024, four M&A transactions were completed on three continents, and two financial transactions that further improved the already solid capital structure.

On the capital structure front, Fedrigoni successfully completed, and on much more favorable terms, the refinancing of a €665 million floating-rate bond loan and significantly increased its liquidity through a sale&leaseback transaction of its industrial plants.

These financial transactions freed up resources and gave a new impetus to M&A. In fact, the Group consolidated the acquisition of the Voiron R&D Centre in France and the Arjowiggins China plant, specializing in the production of translucent papers (both already part of the Arjowiggins Group), and some assets of Mohawk, the second largest manufacturer in the specialty papers sector in North America, were acquired. Finally, Fedrigoni acquired – as part of its corporate venture capital program – a minority stake in SharpEnd, a leading British start-up in IoT and connected solutions.

Today, Fedrigoni counts 5,500 people in 28 countries, has 73 production plants and cutting and distribution centres and more than 25,000 products distributed in 132 countries; it is the leading global player in both specialty papers for luxury packaging and premium wine labels, the third most significant player in the pressure sensitive labels market and the second in art & drawing papers.