"We made important progress on our strategic transformation focusing on new growth markets, innovation, and sustainability"
Dear Shareholder,
Dear Reader,
We are delighted to report another strong year of strategic progress and robust financial performance in 2022, despite the many global challenges. We achieved this by focusing on pricing to offset rapidly rising energy and material costs, by delivering business-mix improvements, capturing growth opportunities, and organizational efficiencies.
We made important progress on our strategic transformation focusing on new growth markets, innovation, and sustainability. In promising growth areas such as Energy Transition, we secured important new orders for applications in green Hydrogen production and Floating Offshore Wind. Focusing on such segments with significant growth and higher value-creation potential strengthened the Group in 2022 and will contribute to future growth and profitability improvements. With the agreement to sell our Steel Wire Solutions businesses in Chile and Peru, we will further improve the business portfolio by reducing exposure to more commoditized and volatile markets.
Sustainability is central to our transformation – both working to minimizing our impact and helping others to minimize theirs. Importantly Bekaert improved its safety record for the fifth year in a row and brought sustainability performance improvements in-line with ambitious targets. We are proud that our near-term and long-term greenhouse gas emissions reduction targets have been validated by the Science Based Targets initiative (SBTi). We are equally pleased that our external ESG ratings continue to improve and recognize the work undertaken across the business, this includes Bekaert being selected for inclusion in Euronext’s BEL ESG Index of the leading sustainable companies in Belgium.
From a financial perspective, we delivered record levels of consolidated sales, which increased by 17% to € 5.7 billion. Underlying EBIT was € 459 million, a resilient performance considering challenging markets with price rises and efficiency gains broadly offsetting higher input costs and lower utilization. Our continued focus on working capital and cash generation resulted in a net debt to underlying EBITDA ratio of 0.7x at year-end 2022, demonstrating our resilient financial position.
Based on these robust results, we are pleased to announce that the Board of Directors will propose to the Annual General Meeting of Shareholders in May a gross dividend of € 1.65 per share, representing an increase of 10% versus the previous year. In addition, the Board has approved another share buyback program in 2023 for Bekaert to repurchase and cancel outstanding shares of up to € 120 million.
Moving forward, we are determined to continue the pace of transformation. We are making investments to accelerate growth in promising markets, both within our core technologies and beyond steel. We are increasing our resources in innovation and digitalization, to create more value for our customers.
Whilst trading in 2023 has started well across all business units, economic uncertainties remain. The robust performance delivered in 2022 and the company’s strong financial position give us confidence in our ability to deliver further on our strategic priorities. We therefore continue to confirm our ambition to reach the mid-term targets (2022-2026) of organic sales growth of 3%+ CAGR and an underlying EBIT margin level of 9% to 11% through the cycle.
We are grateful to our customers, business partners, and shareholders for their continued trust and support.
We would like to thank all our employees for their contribution, energy, and above and beyond spirit.
Oswald Schmid, Chief Executive Officer
Jürgen Tinggren, Chairman of the Board of Directors