Ekornes, the furniture producer in Norway and owner of the brand names Ekornes, Stressless, Svane and IMG, implements temporary capacity adjustment to secure a long-term sustainable and profitable business. Demand for household products and furniture remains weakened as consumer finances are constrained by higher interest rates and rising living expenses. That's read in the company's update.
Addressing the challenging market conditions, Ekornes implemented several initiatives to reduce costs and safeguard profitability through 2023. The trend of weak demand continued in the fourth quarter 2023 with reduced order intake for Stressless, primarily in the Central-European markets. Promotions during the seasonally strong-selling November and December periods stimulated sales less than expected. Entering 2024, current order intake indicates a continued weak market development, a trend expected to continue during the first half of 2024.
Photo: Ekornes.
Adapting to the situation, Ekornes will adjust operational capacity at the Stressless facilities in Norway through temporary redundancies of up to 10% of the 760 FTEs employed within production and assembly at the factories. The Company today initiated negotiations with union representatives. In total, Ekornes employs close to 2,700 FTEs worldwide. 'Ekornes continuously aligns its organisation and production capacity to prevailing demand through the cycles, securing sustainable operations. The initiative reflects a continued slow pace for the furniture industry, and it is essential that we act to ensure resilience and long-term competitiveness for the Group,' comments Tine Hammernes Leopold, CEO of Ekornes.
Source: Oslo Børs