Bergs has conducted a review of its strategy, occasioned by the structural transaction carried out in 2020 when the Group’s Swedish sawmill business was sold and the conditions for continuing operations changed. In view of the financial situation in particular, the existing operations can now be developed at a faster tempo while potential acquisitions in select product areas could constitute new possibilities for development and growth. As part of its strategy initiatives, the Board of Directors of Bergs Timber AB has also decided on new financial targets for the operation.
Bergs will serve as an active ownership company, developing independent subsidiaries with clear responsibility for results. This is an orientation the Group has pursued in recent years, but it is now being strengthened. The ambition is to increase the pace of development for products and services, with a greater degree of processing as well as higher and more stable margins with a more predictable market situation.
In summary, this new orientation means that:
- Bergs will own and develop independent subsidiaries with clear responsibility for results.
- The existing operations in the Group’s seven subsidiaries will be clarified with a division into product areas, also constituting reporting segments, which are: Wood Protection, Joinery, Sawn Wood and Other.
- Bergs intends to make significant investments for organic growth where investments identified for the next three years total SEK 500 million. Bergs will also evaluate potential corporate acquisitions.
- Sustainability initiatives and digitalisation will be given high priority in Bergs.
“In pace with society’s increased endeavours toward sustainability and renewable products, interest in various wood-based solutions is increasing. The Board of Directors therefore sees excellent opportunities for growth with the orientation that has now been adopted,” says Michael Bertorp, Chairman of the Board of Bergs.
“With the sale of the Swedish sawmill business in 2020, conditions for the Group have changed. With a strong financial position and a clear new orientation, I look forward to developing an industrial group of profitable companies with healthy cash flows and the capacity for continual development,” says Peter Nilsson, President and CEO of Bergs.
The new financial targets are:
- Annual growth of 10% over a business cycle.
- EBITDA margin of 9% over a business cycle.
- Financial net debt less than equity.
- Dividend normally 25–40% of profit for the year after tax.
The Bergs Group consists of independent subsidiaries, with clear responsibilities for results, that develop, produce and market processed wood for various applications.
