A Danish manufacturer known for brands Mistral and By Hammel, reported a substantial loss of DKK 31.8 million for 2024, more than double the previous year's deficit. For over a decade, the company had consistent profits between one and two million DKK. The sharp decline is attributed to low consumer confidence, shifts in buying behaviour, and a downturn in the housing market, which have severely impacted the furniture sector.
© Hammel Furniture
Hammel Furniture also made significant investments in expanding production capacity and automation at the Skærbæk factory during 2022 have also led to high start-up costs and excess capacity compared to current demand. CEO Jens-Ole Staghøj acknowledged these "large and necessary decisions" that have short-term financial consequences but aim to strengthen the company's competitiveness long term.
The company's equity halved to DKK 20.4 million by the end of 2024. To mitigate losses, Hammel Furniture raised capital by DKK 15 million and wrote down goodwill by DKK 14.1 million, reflecting caution as it expects to return to previous revenue levels only in three to five years.
Despite the setbacks, the company remains optimistic for 2025, anticipating growth from recent investments and improved productivity, emphasising the critical nature of the upcoming year for its recovery.
Source: www.wood-supply.dk