(Alliance News) - SIT Spa reported Wednesday that it closed 2023 with a loss of EUR23.4 million from a profit of EUR11.2 million a year earlier. Consolidated adjusted net loss is EUR300,000 million versus adjusted net profit of EUR10.9 million in 2022.

Consolidated revenues are EUR326.3 million, a 17 percent decrease from 2022 when they were EUR393.3 million. Sales of the Heating & Ventilation Division in FY2023 amounted to EUR234.0 million compared to EUR315.3 million in FY2022.

Adjusted Ebitda of EUR29.0 million is down 39 percent from EUR47.1 million in the previous year and is affected by the volume effect mainly in the Heating & Ventilation Division only partially offset by the Metering Division and efficiency and cost containment actions.

Depreciation and amortization, at EUR47.1 million, is up from the previous year when it was EUR27.8 million due to the normal increase effect of new investments made during the year and the new signing of operating leases accounted for in accordance with IFRS16.

In addition, the company reports that "as a result of the impairment test carried out at the time of half-yearly reporting, in light of the trend and expected scenarios in the use of gas appliances in home heating resulting from the energy transition, the need emerged to adjust the carrying value of the goodwill of the Heating & Ventilation CGU to its recoverable value by recording an impairment loss of EUR17.0 million."

Adjusted operating income is EUR100,000 versus EUR19.4 million in 2022.

Operating income, in addition to the operating performance, is particularly affected by the impairment resulting from the impairment test and changes to a negative EUR25.2 million in 2023 from a positive EUR10.6 million in 2022.

Net financial debt is EUR153.7 million from EUR130.5 million a year earlier.

Federico de' Stefani, president and CEO of SIT, commented, "The year 2023 presented businesses with a complex economic situation globally that impacted several sectors, including the heating sector in which SIT is present. Uncertain regulations on EPBD also known as "green homes"-only recently approved-, the cancellation of incentives, and the impacts of inflation and high rates have severely slowed household investment. These elements are behind the saturation of warehouses, which has made destocking for the entire supply chain longer than originally forecast, both in Europe and the U.S."

"The complexity encountered in this market," he points out, "was partly offset by the excellent performance of our Metering division, which grew in double digits on the strength of a favorable market environment and the goodness of our positioning strategy in the water metering market.

To cope with this scenario of discontinuity from previous years, the company has "deployed several actions. These include the new corporate organization, the execution of strategic partnerships that have accelerated the Company's entry into business segments complementary to its core ones, and cost containment strategies."

According to the CEO, "the two main targets for improvement - margins and net financial position - will be able to generate satisfaction for all stakeholders."

SIT's stock is in the green by 8.1 percent at EUR1.73 per share.

By Chiara Bruschi, Alliance News reporter

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