During its 175th anniversary year, Freudenberg achieved significant milestones, reporting its highest-ever levels of operating profit, sales, and investments in research and development. Dr Mohsen Sohi, CEO of the Freudenberg Group, attributed this success to the dedication and commitment of its global workforce.
Freudenberg's sales for fiscal year 2023 reached €11,902.8 million, with organic growth of approximately 3.5%. Despite challenges posed by exchange-rate effects, the company demonstrated resilience and maintained steady growth. Operating profit saw a remarkable increase of 15%, totalling €1,081.6 million, driven by innovative product lines and strategic market expansion initiatives.
The company's investment in research and development surged by 4.6% to €603.6 million, underscoring its commitment to innovation and future viability. Investments in intangible and tangible assets amounted to €452.7 million, with strategic expansions across various business segments and geographic regions.
Freudenberg's global footprint expanded further, with investments in manufacturing facilities and technology centres worldwide. Notable investments include the expansion of battery systems production in the US, the establishment of a new plant for elastomer products in Spain, and the inauguration of a production facility in India.
Looking ahead, the company acknowledges the economic and geopolitical uncertainties, reaffirming its focus on agility, customer-centricity, and long-term strategic initiatives. With a steadfast commitment to mobility transition, digitalisation, and sustainable solutions, it hopes for continued growth and innovation in the future.
Freudenberg In India
Freudenberg India’s revenue grew by 10.8% to INR 3,803 crore, against CY22, marking a significant milestone for the company. The operating revenue for increased significantly by about 18.3% to INR 695 crore against INR 568 crore registered in CY22.
Sivasailam G, Director & CEO, Freudenberg Regional Corporate Center India & Managing Director at Freudenberg Performance Materials India, said, the increased operating revenue can be attributed to successful indigenisation efforts, wherein it has transitioned many key components from imports to local production. This move has significantly enhanced the competitiveness and allowed the company to offer benefits to its customers. Additionally, its focus on operational excellence has played a crucial role in improving the bottom line. Notably, the sales from the automotive segment have surpassed INR 1,500 crore, reflecting strong performance in this sector, he added.
Talking on the outlook for CY24, he said, “We are expecting a moderation in the automotive passenger vehicle segment in the year 2024. However, as Freudenberg India’s business is spread in all the segments, it does not see automotive segment going down substantially in the year 2024. We are expanding our foray into commercial vehicles as we expect a significant growth coming out of this segment in 2024,” he added.
Freudenberg announced investments totalling INR 350 crore, with a focus on expanding its operations in Punjab, Karnataka, and Tamil Nadu.
The company is also set to explore surface treatment and specialty lubricants, while simultaneously expanding its research and development capabilities and innovation efforts in the field of technical textiles. While currently meeting the demands of domestic OEMs for EV-specific sealing solutions, battery cell separators, and fuel cell solutions, the company is also actively developing future-oriented solutions for electric vehicles, Sivasailam added.
In a strategic move to enhance its manufacturing capabilities, Freudenberg has invested in a new production facility in Morinda, India, catering to its Vibracoustic Business Group and its Freudenberg-NOK India joint venture. Additionally, the company's export business from India continues to thrive, with exports amounting to nearly INR 800 crore.
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