Garo reports lower earnings for 2022 despite revenue growth
Swedish electrical products firm Garo saw its 2022 revenue rise to 1.39 billion SEK, but component shortages and a challenging fourth quarter dampened profit margins.
Garo concluded the 2022 fiscal year with a net revenue of 1.39 billion SEK, marking a 7 percent increase compared to the previous year. Despite the growth in sales, the company's operating profit (EBIT) fell to 152.8 million SEK from 207.2 million SEK in 2021, leading to an EBIT margin contraction to 11 percent.
The fourth quarter was particularly challenging for the E-mobility division, where a persistent shortage of electronic components hindered production and distribution. This supply constraint occurred as the market shifted demand toward connected charging products, causing a decline in sales for the company's older, non-connectable charger models.
In contrast, the Electrification business segment performed well, reporting an 11 percent revenue increase in the fourth quarter. Growth was supported by strong demand for electrical distribution products and energy efficiency solutions within the renovation and construction sectors. During this period, the company appointed Daniel Emilsson to lead the Electrification business area.
Looking ahead, Garo has begun expanding its direct market footprint in Germany to bolster growth. While management expects the component shortage to continue impacting operations into early 2023, they remain optimistic about the long-term structural expansion of the European charging infrastructure market.