A moderate recovery is forecast
Although SBA Furniture’s revenues were 14% lower last year than in 2022, sales are expected to grow this year.
‘The internationally competitive furniture manufacturing business faced new global challenges last year, such as a slowdown in demand, lower production volumes and rising interest rates. The main antidote to this is a maximum focus on efficiency, which helps manage processes rationally and maintain leadership. We are forecasting a positive turnaround this year and therefore expect moderate growth. If we achieve double-digit revenue growth, we would consider it a fair recognition of our efforts,’ says Egidijus Valentinavičius, SBA Vice President.
According to him, businesses expect more significant changes in the second half of the year, but this will also depend on the anticipated decisions of central banks to cut interest rates and the speed of the global economic recovery. Important geopolitical events such as the war in Ukraine, the escalation of hostilities in the Middle East and their impact on logistics chains, and the US presidential election may also play a significant role.
Continuing strategic investments
Despite the challenges, SBA Group furniture companies continued their strategic investments last year.
‘Even in difficult times, we must be guided by long-term business objectives to increase our competitive edge. That’s why SBA Furniture companies have invested more than EUR 11 million in robotics and automation solutions, as well as in production efficiency and energy-saving equipment through 2023. To achieve sustainable business growth in the future, we continue to intensively explore opportunities for new strategic projects,’ says Jurgita Radzevičė, CEO of SBA Home, a group of four furniture manufacturing companies.
According to Radzevičė, even though global demand has fallen, Inno Line – one of the most modern factories in the region – by exploiting its competitive advantage, increased its sales by 8% to EUR 133 million last year. Klaipėdos Baldai sales were EUR 99 million, 17% less than last year. Visaginas Linija sales amounted to EUR 66.5 million, 25% less than in 2022. Šilutės Baldai revenue was almost 33% less at EUR 35 million.
Kauno Baldai, the SBA soft furnishing manufacturer, increased its sales by 10% to EUR 26 million last year.
J. Radzevičė advises that raw material prices have fallen by around a tenth over the year, which is already starting to be reflected in the cost of products. This change is therefore also impacting overall sales volumes.
SBA is one of the country’s largest Lithuanian-owned business groups, operating in the furniture manufacturing, textile, real estate and investment management sectors. It exports its products to 50 countries worldwide.
