Viking LSE goes from strength to strength

2024-03-15T18:08:22+00:00 March 15th, 2024|Finance|

Viking Life-Saving Equipment delivered outstanding results across its product areas and markets in 2023, the company claimed.

In terms of revenue and, in particular, earnings, the company has met the goals set out in its BP25 business plan much earlier than expected.

Work on the next business plan, BP28, with new strategic objectives, is well advanced, and is due to be approved later this year.

Net revenue increased for the second consecutive year by almost DKK400 mill to DKK3.53 bill against DKK3.14 bill in 2022. Pre-tax profit totalled DKK436.2 mill, up from DKK330.8 mill the year before.

“The annual result is remarkable because none of our product or market areas have developed negatively over the year, while the offshore segment has developed particularly strongly.

“The growing service business has with good reason been stealing the limelight for several years, but in 2023 product sales – on which everything else is based – developed even more impressively. We have seen high activity in all our business areas,” said Gert Lillebæk, CFO.

Previously, Viking had excess production capacity within certain product categories, but order volumes for rescue boats are at an unprecedented high level, while production of immersion suits and fire-fighting suits for the global market is also at an all-time high.

High growth brings increased costs, but in 2023 costs have increased less than both revenue and the contribution margin, which is slightly up on the previous year.

“We intend to maintain momentum by investing in the service business, in production and in product development. Within services, the goal is to offer a full scope service at a growing number of our service stations so that we cover all service areas, in particular the servicing of lifeboats and marine firefighting equipment.

“We’re also investing in products and concepts to meet the needs of our customers for solutions that make operational sense and reduce the complexity of their business,” Lillebæk said.

The investments in service stations and in new production facilities in Greece and Norway will increase costs in the coming financial year, but are considered to be an investment in future earnings.

With a moderate outlook for revenue growth in 2024, the company is budgeting with a marginally improved bottom line.

Geopolitical tensions continue to impact the supply chains that the company relies on for its raw materials and for being able to deliver its finished products on time.

In particular, the political turmoil in the Red Sea, near the Suez Canal, may delay goods and increase costs if shipping companies choose to route their ships south of Africa.

“We’re feeling the knock-on effects of general global unrest and uncertainties about where the next conflict might flare up. We must remain agile and responsive to changing circumstances,” Lillebæk added.

At the end of 2023, Viking’s extensive service network covered 279 authorised service stations worldwide, and the company’s global presence included 36 of its own foreign subsidiaries represented in 79 locations.

The investment in several full scope service stations is one of the reasons why the number of full-time employees increased by more than 200 to 3,294.

Viking said it was deeply saddened by passing of Henrik Uhd Christensen, its CEO since 2010, on 17th January, 2024 after a brief illness.

“I’m so sorry that Henrik was unable to communicate the results of an amazing year, which he impacted greatly through his skilled leadership. He repeatedly said that he wanted to hand over Viking in a better shape than when he was appointed CEO. And he certainly did,” Lillebæk said.

On 1st June, 2024, Henrik Helsinghof will take up the position of new CEO.