Course set for further growth

Further drastic price increases for raw materials and another difficult procurement situation characterised the 2022 financial year at HERMA. For example, the price of pulp, an important raw material for paper production, rose by an average of between 30 and 40 percent in Europe. "For our part, we were forced to adjust the prices for various products, sometimes several times during the year, and pass them on to customers," explain Sven Schneller and Dr Guido Spachtholz, the managing directors of the company specialising in packaging and product labelling. As a result of this price spiral, turnover also increased significantly more than planned: 510.6 million euros in turnover means an increase of 19.2 per cent compared to the previous year (428.4 million euros). "We have experienced an inflationary price development. But it masks another reason for an extremely challenging business performance," the directors emphasise. Because of a month-long strike at one of the world's largest paper manufacturers, for example, there were sometimes considerable delays in the supply of the important raw material. "We therefore had to hold repeated price discussions with our customers and sometimes also talk about delivery dates that were beyond our control. Both have therefore put a strain on some customer relationships in 2022. But we are proud of the fact that our teams have mastered many imponderables with a very high level of personal commitment and that we have remained able to deliver adhesive materials, labels and labelling machines, albeit sometimes with delays. That was by no means a matter of course in our industry. We were able to prove that HERMA can be relied upon even in difficult situations." Against the background of a challenging environment, the company is satisfied with the result. Schneller and Dr Spachtholz are cautiously positive about the outlook. Whereas in the first quarter of 2023, due to precautionary well-stocked warehouses, there was still a noticeable restraint on the part of customers, the HERMA management anticipates a sales increase in the mid-single-digit range for the entire current year. "We have to achieve this growth primarily through sales volume again." As in 2022, all three business units are again expected to contribute to growth in the current financial year. The number of employees remained almost constant in 2022, at 1,126 at the end of the year (previous year: 1,124). The export share rose to 64.0 per cent compared to 62.5 per cent in the previous year.

Sights set on capacity expansion and opening up new markets
The two HERMA managing directors see the company on a clear course for growth in the medium and long term. The course for this has already been set. In accordance with the HERMA 2030 strategy, which was adopted last year, the company intends, for example, to expand its production capacities in the field of self-adhesive materials over the next few years - in Europe and in markets outside Europe. In the area of labels for industrial customers, HERMA sees good prospects for innovative labelling solutions, some of which are to be driven forward with system partners. For office and private label users, digital solutions are to be increasingly added. The Labelling Machines division wants to realise further growth potential, especially in North America and Asia. "German mechanical engineering continues to enjoy an excellent reputation there, especially when it is accompanied by a pronounced service orientation," says Dr. Spachtholz. In order to round off the portfolio as a comprehensive solution provider, acquisitions in this area are also conceivable. Across the company, HERMA sees sustainability as a key growth driver - and competitive advantage - alongside innovation and digitalisation. "Anyone who produces in a demonstrably sustainable manner is increasingly in demand as a solution provider worldwide. It is not only worthwhile for the climate, but also economically, if you set ambitious goals and work with all your might to achieve them," emphasise the HERMA managing directors. HERMA is aiming for net zero emissions of climate-relevant gases by 2040.