SMS group, a global leader in metallurgical plant and equipment manufacturing, has demonstrated remarkable progress in its 2023 fiscal year, showcasing its commitment to innovation and sustainability in the steel industry. The company's performance reflects a strategic shift towards expanding its service business while simultaneously pushing forward with groundbreaking decarbonization projects.
In the fiscal year 2023, SMS group reported a substantial increase in order intake, surpassing five billion euros, up from 4.6 billion euros in the previous year. This 9.3% growth underscores the company's strong market position and the increasing demand for its products and services. Sales also saw a significant boost, rising to €3.4 billion from €3.1 billion in the previous year, marking an 8.3% increase. These figures highlight the company's ability to capitalize on market opportunities and deliver value to its customers.
A key driver of SMS group's success has been its focus on expanding its service business. CEO Jochen Burg emphasized the importance of this strategy, stating that the close integration of plant engineering and service business is the main catalyst for profitable growth. The company has taken decisive steps to strengthen this aspect of its operations by consolidating its expertise in electrical and automation systems, technical service, and digitalization into a single business unit. This move positions SMS group to offer comprehensive, tailored solutions to its global customer base. The company has set an ambitious target to increase its service business share to at least 50% by 2030, reflecting its long-term commitment to this growth strategy.
SMS group's financial performance in 2023 showed significant improvements across various metrics. The operating result saw a dramatic increase from €22 million to €134 million, representing a 509.1% growth. Adjusted earnings before taxes rose to €42 million, more than doubling the previous year's figure of 19 million euros. Net liquidity also saw a substantial improvement, increasing by 80.8% to €906 million. These financial indicators demonstrate the company's enhanced profitability and strong financial position.
In line with its #turningmetalsgreen mission, SMS group is at the forefront of driving decarbonization in the steel industry. The company is currently involved in two major reference projects that showcase its commitment to sustainable steel production. For H2 Green Steel in Sweden, SMS group is constructing the world's first steel plant designed to operate using 100% green hydrogen. The project has progressed significantly, with plant components being manufactured and delivered to the site in Sweden. Additionally, SMS group is preparing for the construction of the first direct reduction plant for thyssenkrupp Steel in Duisburg, Germany. This facility is expected to reduce CO2 emissions by more than 3.5 million metric tons per year, marking a significant step towards greener steel production.
SMS group's focus on competitiveness is evident in its increased investments, which rose to 151 million euros in 2023 from 129 million euros in the previous year. A key initiative is the construction of a new production facility on India's west coast, aimed at strengthening the company's presence in this strategically important market. The company is also developing innovative technologies like EASyMelt, a process designed to radically reduce CO2 emissions in conventional blast furnace operations. These investments demonstrate SMS group's commitment to maintaining its technological edge and meeting the evolving needs of the industry.
The company's forward-looking approach is further exemplified by the opening of its new SMS Campus in Mönchengladbach, Germany. This state-of-the-art facility provides attractive workspaces for over 2,000 employees, fostering a contemporary work environment that promotes collaboration and innovation. Looking ahead, SMS group has set ambitious targets for the current fiscal year, projecting sales to increase to €3.8 billion and aiming for a significant rise in operating results. The company's long-term goal is to achieve an EBTA margin of at least 7% by 2027, reflecting its confidence in its strategic direction and growth potential.
