Würth Group continues on its growth track
Sales rose by 18.4 percent to EUR 9.9 billion in the first half of 2022
- Operating result increases to EUR 720 million
- Group has 84,494 employees
- Macroeconomic and political situation dampens expectations for the second half of the year
- Investments in the company ensure sustainability
The Würth Group, world market leader in the manufacture and sale of assembly and fastening materials, was able to carry the growth momentum from the 2021 fiscal year into the first half of 2022 in spite of the unstable economic situation.
The globally operating Group recorded sales of EUR 9.9 billion in the first six months, corresponding to an increase of 18.4 percent compared to the same period of the previous year and of 17.0 percent adjusted for currency effects.
Supply and material bottlenecks, price increases, the COVID-19 pandemic and, since February, the conflict in Ukraine: Coping with these crises which are currently hitting the economy is very challenging for all of us. Currently, the energy crisis is coming to a head and we are all looking for alternatives, which, in turn, may be an opportunity for the transition to more sustainability. In this context, achieving such positive results is more than satisfactory. However, we are aware that we will probably not be able to maintain these high growth rates given the fact that the economy is cooling down.
Companies in Germany and abroad are growing
In Germany, the Würth Group generated sales of EUR 3.9 billion (+12.7 percent). Especially the companies operating in Germany’s Electrical Wholesale unit managed a very robust sales development. The company eiSos in Waldenburg was even able to build seamlessly on the strong year of 2021. After months of rather subdued business development, the Trade unit recovered and grew at double-digit rates. The companies abroad generated sales of EUR 6.0 billion (+22.3 percent). The companies in Spain, Italy, North America and South America were the driving force behind growth. Adolf Würth GmbH & Co. KG, the largest individual company of the Würth Group, generated sales of EUR 1.4 billion including intra-Group sales (+10.1 percent). The further expansion of multi-channel sales has paid off: E-business sales in particular grew by 21.4 percent year on year, representing 20.2 percent of total sales.
Volatile economic situation
Since the beginning of the year, the German economy has been recovering gradually from the effects of the COVID-19 pandemic of the last two and a half years, but the positive trend is being curbed severely, as the conflict in Ukraine and China's zero-Covid strategy are driving up prices, while increased energy costs and supply bottlenecks are pushing prices even further. For the first time since the beginning of the pandemic, container ships are also jamming on the North Sea along the German, Dutch and Belgian ports. The Kiel Institute for the World Economy estimates that more than eleven percent of all goods shipped worldwide cannot be cleared at present.
Despite the tense situation, we have the supply of materials to our customers under control. This is our top priority. The continuing customer growth shows that our customers can rely on our ability to deliver, particularly compared to our competition. Maintaining this relationship of trust is what we are focusing on.
As of June 2022, the operating result of the Würth Group is at EUR 720 million and thus clearly up on the previous year (EUR 520 million). This positive development is above all the result of productivity increases at the large, established companies in Germany, Southern Europe and the USA.
The Würth Group acquired 1,311 new employees in the first half of 2022. Currently, 84,494 people work in the Group, 41,829 of which are active in the sales force. At the end of 2021, the Group had a total of 83,183 employees. In Germany, the Group has 25,807 employees.
Investments at headquarters ensure the Group’s future viability
The company lays the foundation for further growth by investing in its future viability. The expansion of the warehouse and logistics center at the headquarters in Künzelsau-Gaisbach, the largest logistics investment in the Group’s history, is a clear commitment of Würth to the Hohenlohe region. In addition, the company has built an innovation center at the premises of the Group headquarters to strengthen its own manufacturing expertise and innovative strength. It will be inaugurated and put into service on 28 September 2022.
Especially in times of crisis, it is important to offer our employees security. With our investments, we are creating stability—a positive signal not only to the workforce, but also to future employees. After the experiences from the COVID-19 pandemic, this is a decisive criterion for many people.
Outlook for the second half of the year
The volatility of the current situation makes it difficult to assess how the economy will develop. Supply bottlenecks will continue to affect industry and the construction sector. The same applies to high commodity prices and the development of inflation and interest rates. The future gas supply also remains uncertain after the Federal Ministry for Economic Affairs and Climate Action declared the second stage of the gas emergency plan in Germany on June 23, 2022.
The outlook for the second half of 2022 is certainly anything but optimal due to difficult general conditions. Nevertheless, we currently expect the company to continue its positive development with double-digit sales growth in 2022—provided the global economic and political situation does not deteriorate more dramatically.
About the Würth Group
The Würth Group is the global market leader in the development, production, and sale of fastening and assembly 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 employs more than 84,000 employees in over 400 companies with more than 2,500 pick-up shops across 80 countries. The Group achieved sales of EUR 17.1 billion in fiscal year 2021. With 7,500 employees, Adolf Würth GmbH & Co. KG in Künzelsau is the largest single company in the Würth Group.