Harvia Q4 2023: Revenue back to growth with strong profitability and cash flow

Stock Exchange Release | 8 February 2024

Harvia Plc, Financial statements bulletin, 8 February 2024 at 9:00 a.m. EET


This release is a summary of Harvia Plc’s Financial statements bulletin 2023. The complete report is attached to this release as a pdf file. It is also available on Harvia’s website at https://harviagroup.com/.

Highlights of the review period

October–December 2023:

  • Revenue increased by 3.4% to EUR 39.4 million (38.1). At comparable exchange rates, revenue increased by 5.2% to EUR 40.1 million. Organic revenue growth was 5.2%.
  • Operating profit was EUR 9.2 million (6.6), making up 23.4% (17.2) of the revenue.
  • Adjusted operating profit reached EUR 9.5 million (7.9), making up 24.2% (20.8) of the revenue. At comparable exchange rates, the adjusted operating profit was EUR 9.8 million (24.5% of the revenue).
  • Operating free cash flow amounted to EUR 15.5 million (15.1) and cash conversion was 138.9% (158.9).

January–December 2023:

  • Revenue decreased by 12.7% to EUR 150.5 million (172.4). At comparable exchange rates, revenue decreased by 11.7% to EUR 152.2 million. Organic revenue growth was -9.4%.
  • Operating profit was EUR 33.0 million (34.7), making up 21.9% (20.1) of the revenue.
  • Adjusted operating profit reached EUR 33.7 million (36.5), making up 22.4% (21.1) of the revenue. At comparable exchange rates, the adjusted operating profit was EUR 34.4 million (22.6% of the revenue).
  • Operating free cash flow amounted to EUR 44.6 million (34.0) and cash conversion was 111.7% (79.1). The change in net working capital increased the operating free cash flow and cash conversion.
  • Net debt amounted to EUR 37.6 million (54.5) and leverage, calculated as net debt divided by 12 months’ adjusted EBITDA, was 0.9 (1.3).
  • Equity ratio was 51.0% (47.3). 
  • Earnings per share were EUR 1.25 (1.45).
  • The Board of Directors’ dividend proposal is EUR 0.68 (0.64) per share in total, to be paid in two instalments.
  • On 28 March 2023, the Board of Directors of Harvia plc appointed Matias Järnefelt as Harvia’s CEO. Järnefelt started in his position on 1 June 2023.

Key figures

EUR million10-12/202310-12/2022Change1-12/20231-12/2022Change
% of revenue27.5%21.4% 26.1%23.9% 
Items affecting comparability *0.31.4-78.0%0.61.8-64.7%
Adjusted EBITDA **11.19.516.9%39.942.9-7.0%
% of revenue28.3%25.0% 26.5%24.9% 
Operating profit9.26.640.5%33.034.7-4.7%
% of revenue23.4%17.2% 21.9%20.1% 
Adjusted operating profit **9.57.920.1%33.736.5-7.6%
% of revenue24.2 %20.8% 22.4%21.1% 
Basic EPS (EUR)0.390.2278.3%1.251.45-14.1%
Operating free cash flow15.515.12.2%44.634.031.2%
Cash conversion138.9%158.9% 111.7%79.1% 
Investments in tangible and intangible assets-1.4-0.7104.2%-3.1-3.6-12.9%
Net debt37.654.5-31.1%37.654.5-31.1%
Leverage0.91.3 0.91.3 
Net working capital36.145.3-20.3%36.145.3-20.3%
Adjusted return on capital employed (ROCE)44.2%54.5% 44.2%54.5% 
Equity ratio51.0%47.3% 51.0%47.3 % 
Number of employees at end of period605633-4.4%605633-4.4%

* Consists of items outside the ordinary course of business, relating to the Group’s strategic development projects, acquisitions, business divestments, restructuring and loss on sale of fixed assets, and affecting comparability.

** Adjusted by items affecting comparability.

Financial targets and outlook

The company has set long-term targets related to growth, profitability and leverage. Harvia targets an average annual revenue growth of more than 5%, an adjusted operating profit margin exceeding 20% and a net debt/adjusted EBITDA between 1.5x−2.5x in the long term. The future impacts of changes in IFRS accounting standards have been excluded from the net debt/adjusted EBITDA ratio target.

Harvia does not publish a short-term outlook.

Harvia’s dividend policy is to pay a regularly increasing dividend with a bi-annual payout.

Matias Järnefelt, CEO:

In the fourth quarter of 2023, Harvia’s revenue returned to growth while we continued to deliver strong profitability and strengthen the foundations for future growth.

During the fourth quarter, our revenue reached EUR 39.4 million, an increase of 3.4% compared to the previous year. This was driven by the strong growth in North America and improving sales performance in Central Europe. Organic growth was 5.2%. The exit from Russia in 2022 and some exchange rate developments, mainly due to USD to EUR exchange rate changes, impacted our revenue negatively.

The market conditions continued to differ also in the fourth quarter, with the European markets generally weaker than the markets outside Europe. However, Central Europe started to show some signs of stabilization after a long, weak period. The sales channel inventory levels were decreasing to a normal level and our B2B customers were more confident in ordering products. However, the market conditions were tough in Finland and Scandinavia, where high interest rates, low consumer confidence and challenges in the construction sector still continued to have a negative impact on sales in all product groups.

Outside Europe, Harvia maintained and even accelerated its already strong growth. The North American market continued to grow at a fast pace, which supported our excellent sales performance in the region. The majority of our business in North America comes from selling complete solutions to customers rather than selling only heaters. This is visible in the increasing share of sauna rooms of our total sales. Our sales efforts were successful also in Asia-Pacific, where our sales developed very favorably and according to plan. Excluding sales in Russia in 2022, the revenue of the “Other countries” market area grew by 33% in the fourth quarter, driven by the Asia-Pacific countries.

The fourth quarter’s adjusted operating profit reached EUR 9.5 million, increasing by 20.1% from the comparison period and amounting to 24.2% of revenue. Our profitability was supported by the increased revenue, but it also reflects the systematic work we have done to adjust pricing, improve supply chain efficiency and optimize our operations. Additionally, inflationary cost pressures have eased in some of our key materials and components. Harvia’s operating cash flow was again strong at EUR 15.5 million. We also managed to further reduce our inventories, which is visible in the unusually high cash conversion of 138.9%. I would like to thank the entire team Harvia and our partners for their great work in the fourth quarter and the full year 2023.

Harvia continues to work systematically to strengthen the foundations for the company’s future profitable growth. Ensuring continued strong sales performance in North America is very important for us. Moreover, we continue to actively drive growth in Japan and more widely in Asia-Pacific. We will also be working hard to maximize opportunities in our home markets in Europe. While we drive top-line activities, we are also focusing on maintaining our very good operative performance, a key competitive advantage of Harvia. We are also increasing our level of ambition in delivering exciting innovations to the market. Our new organizational structure, supporting the implementation of our strategy, came into effect on 1 January 2024. In addition, we have continued to work determinedly to further develop the sustainability of Harvia’s products and operations and prepare for the upcoming EU sustainability reporting requirements.

For Harvia, year 2023 was characterized by achieving strong profitability and cash flow in a mixed market environment. Our growth was strong in North America throughout the year, and it became our largest reported market area in 2023. Towards the end of the year, our sales development in North America and our improving sales performance in Central Europe helped us to turn our revenue back to growth. Looking at the future, the sauna and spa industry continues to offer several opportunities for Harvia in both short and long term. We continue to advance industry consolidation and seek growth opportunities actively also on the M&A front. Harvia is well positioned to strengthen its standing as industry leader.

Press conference on financial results

Harvia will hold a webcast for analysts, investors and media on 8 February 2024 at 11:00 a.m. EET. The conference will be held in English. Harvia’s CEO Matias Järnefelt and CFO Ari Vesterinen will host the event. The webcast can be followed at https://harvia.videosync.fi/q4-2023.

A recording of the webcast will be available after the event on the company’s website https://harviagroup.com/investor-relations/.


For more information, please contact:

Matias Järnefelt, CEO, tel. +358 40 5056 080
Ari Vesterinen, CFO, tel. +358 40 5050 440


Harvia is one of the leading companies operating in the sauna and spa market globally, as measured by revenue. Harvia’s brands and product portfolio are well known in the market, and the company’s comprehensive product portfolio strives to meet the needs of the international sauna and spa market of both private and professional customers.

Harvia’s revenue totaled EUR 150,5 million in 2023. Harvia Group employs approximately 600 professionals in Finland, Germany, United States, Romania, China and Hong Kong, Austria, Italy, Estonia, and Sweden. The company is headquartered in Muurame, Finland, adjacent to its largest sauna and sauna component manufacturing facility.

Read more: https://harviagroup.com