The Würth Group Continues to Grow Despite Economic Slowdown

The Würth Group, world market leader in the development, production and sale of assembly and fastening materials, reports sales of EUR 10.5 billion in the first half of 2023. This corresponds to an increase of 5.9 percent compared to the same period last year. Adjusted for currencies, this is equivalent to 6.6 percent.

The Group remains on course for growth, albeit at a much slower pace than in the previous two years. “We feel the slowdown in the economy in the first half of 2023: After two years of record sales and operating result, the economic slowdown is becoming apparent,” summarizes Robert Friedmann, Chairman of the Central Management Board of the Würth Group.

After almost three years of the COVID-19 pandemic and related supply chain problems, the supply situation is improving for the Group. At the same time, interest rates remain at a high level, which, in turn, hampers the demand in the construction industry. Geopolitical challenges such as the smoldering conflict between China, Taiwan and the USA, as well as the war in Ukraine and the associated high energy prices influence the economic growth in Germany. “Against this backdrop, we are very satisfied with the development in the first half of 2023,” emphasizes Friedmann.

Companies in Germany and abroad

The companies of the Würth Group in Germany generated sales of EUR 4.2 billion and with almost double-digit growth (+9.6 percent) reported a positive development overall. It is pleasing to see that well-established companies of the Würth Group such as Würth Industrie Service in Bad Mergentheim, tool distributor HAHN+KOLB in Ludwigsburg and electrical wholesaler FEGA & Schmitt in Ansbach have made a decisive contribution to this successful result, which was achieved without acquisitions. The companies abroad generated sales of EUR 6.3 billion (+3.5 percent). Growth drivers were the companies in southern and eastern Europe.

Looking at the different industries in which Würth operates, we see a split picture: The Electrical Wholesale unit seamlessly continues the successes of the previous year growing by 17.3 percent in the first half of the year. This sector continues to benefit from the boom in renewable energies, especially in the field of photovoltaic installations. The companies of the Chemicals unit can also look back on strong growth in the first half of 2023. On the other hand, companies such as Würth Elektronik eiSos, manufacturers of fittings and the Trade unit are affected by the global economic slowdown.

Adolf Würth GmbH & Co. KG, the largest individual company in the Würth Group, generated sales of EUR 1.5 billion including intra-Group sales (+8.6 percent).

Focus on digitalization

Digitalization of processes is indispensable for the competitiveness of companies. The procurement of goods via digital channels such as the online shop or Würth App makes our customers’ day-to-day work easier. This is proven by the growth of e-business in the Würth Group: Sales went up by 15.2 percent compared to the previous year, accounting for 22.1 percent of total sales.

Employees

The Würth Group hired 1,409 employees in the first half of 2023. Currently, the Group employs 87,046 people, 43,859 of which work in sales. At the beginning of 2023, the number of employees worldwide came to 85,637. In Germany, the Group has 26,784 employees on the payroll.

Operating result

After six months, the operating result of the Würth Group amounts to EUR 680 million, which is slightly below the same period under review of last year (EUR 720 million). Apart from higher personnel expenses, this development is due to increased costs for mobility and maintenance, as well as the ongoing price pressure. The rating agency S&P Global has confirmed the Würth Group’s A rating for over 25 years. This rating confirms the Group’s financial stability and sound financial footing. It is an expression of a positive credit rating as well as the continuous and successful development of the Group and thus a sign of the stability of the business model.

Social commitment is an integral element of Würth

“As a family business, we see it as our duty to grant support wherever possible. We want to live up to the Würth family’s commitment to ownership,” adds Friedmann on the voluntary commitment of roughly 100 Würth employees at the 2023 Special Olympics World Games, the world’s largest inclusive sports event, in Berlin. The Würth volunteers supported the competitions soccer, futsal and beach volleyball. As presenting partner, Würth also represented the beach volleyball competition with its logo. The commitment to people with disabilities is based on an initiative of Carmen Würth.

Outlook for the second half of the year

It is currently difficult to predict how the many conflict hotspots and their consequences such as high energy prices will affect the Würth Group. Even though the German economy is weakening, the global economy is slowly recovering according to the Organisation for Economic Co-operation and Development (OECD). “On a positive note, the transport markets have clearly recovered and the COVID-19 pandemic is not as prevalent as before. In general, it can be said that supply chains have stabilized significantly again, which means that availability has almost reached the pre-crisis level. Procurement prices, which are still well above the pre-crisis level, remain problematic. Provided conditions do not deteriorate drastically, we expect mid-single-digit sales growth and a slight decline in operating result,” Friedmann says.

 

The next Press Conference on the Annual Financial Statements of the Würth Group will take place on 14 May 2024.

About Würth Group

The Würth Group is the global market leader in the development, production and sale of assembly and fastening materials. Other trading and production companies, known as the Allied Companies, operate in related business areas, ranging from electrical wholesale and electronics to financial services. The Group currently employs more than 87,000 employees in over 400 companies with more than 2,500 pick-up shops across 80 countries. The Group achieved sales of EUR 19.9 billion in the 2022 fiscal year. With over 7,700 employees, Adolf Würth GmbH & Co. KG in Künzelsau is the largest single company in the Würth Group.