CEO Message

Dear Shareholders,

In the eight months since becoming CEO, I have had many fruitful conversations with dormakaba employees and customers around the world. I am grateful for their frank input and highly encouraged by their enthusiasm for what we as a company have to offer.

Transformation program delivers tangible improvements
Our strategy execution is progressing well and delivering tangible, sustainable improvements, supported by the transformation program introduced in July 2023. In the past year, we have set up the three planned regional shared service centers, defined the optimization of our operations network for implementation, improved plant productivity, consolidated our supplier base further, and established a global product development roadmap. We reached agreements with our social partners in Germany, Switzerland and Austria which enabled us to enter the execution phase of major transformation initiatives and to realize the corresponding cost savings. With major efficiency initiatives in execution, we are now advancing to establish further growth initiatives. This will include building on leadership positions to boost sustainable growth in core markets, leveraging key offerings beyond their home markets, and further reducing portfolio complexity to free resources for further investment in innovation.

Strong 2023/24 performance both for organic growth and profitability
The 2023/24 results show our progress: We achieved strong organic net sales growth of 4.7% in a demanding economic environment. We significantly expanded our adjusted EBITDA margin by 120bps to 14.7%, showing first payoffs from the transformation program. Both business segments, Access Solutions (AS) and Key & Wall Solutions and OEM (KWO), contributed to this strong performance: our AS core markets recorded positive organic net sales growth and KWO overall marked a record year in both growth and profitability. Return on capital employed (ROCE) increased substantially by 390bps to 29.0%, profiting from improved average net working capital and adjusted EBIT. Finally, we achieved solid free cash flow and strengthened our debt profile.

Setting our team up to win
Our success in key markets and market segments highlights that our strategic initiatives are well aligned with what our customers want. Our new organizational setup, with global management of our commercial activities and innovation, has brought us closer to our customers to serve them more efficiently as one global team. This has led to significant project wins around the world, such as the University of Osloʼs ambitious Life Science Building project, where dormakaba was chosen to supply access solutions for what will become Norwayʼs largest research and education facility.

We successfully implemented numerous airport projects around the world, expanding our regional production center in Chennai to meet growing demand. To maintain our innovation leadership in this sector, we are collaborating with leading technology companies like Rohde & Schwarz on new solutions for passenger screenings.

Merging innovation, sustainability and customer efficiency
Our Motion IQ technology and Door Efficiency Calculator (DEC) tool are prime examples for how we are merging innovation, customer efficiency and sustainability by offering our customers solutions that help them meet their own sustainability goals. Starting with Germany and Switzerland in the past year, Motion IQ is now being rolled-out throughout Europe and is continuously integrated into more product ranges such as automatic swing doors. The DEC tool is now introduced in 18 countries.

Recognized progress in our sustainability initiatives
We have hit our ambitious CO₂ emissions targets for the third year in a row, and have again increased our share of self-generated solar energy. Further, we have taken a big leap in our health and safety management, resulting in a substantial reduction of our recordable injury rates. Our overall progress in sustainability has been recognized by the media and the markets. dormakaba was named among TIME magazine’s 500 World’s Most Sustainable Companies for 2024, and one of Europe’s Climate Leaders by the Financial Times. We kept our Prime Status in the ISS-ESG Corporate Rating and our AA rating from MSCI. We also received our third gold medal from EcoVadis, recognizing dormakaba as among the top five percent of over 130,000 organizations assessed for ESG criteria.

Outlook
Looking ahead, we will continue to execute our strategy, supported by a strong orderbook and new, innovative products. We are confident that we will continue to grow organically despite an ongoing, challenging environment. For 2024/25 we expect organic net sales growth in the range of 3–5% and adjusted EBITDA margin of at least 15%.

Throughout this eventful year, I have been most grateful for the positive energy of our employees, whose drive to innovate and provide great service is at the heart of all we do – and for the inspiration of our customers, whose ever-evolving needs give us the chance to show our best. Together, we are on the right path to growth.

Sincerely,

Till Reuter

CEO