“All of the SBA Group’s main sectors – furniture, real estate and textiles – grew their earnings last year, driven by rising demand for products and services, as well as rising prices in domestic and export markets. Companies expanded production and innovated to improve efficiency. However, sharp increases in the prices of timber and other raw materials, as well as transport, energy and, in particular, electricity and gas, affected the financial result. As production costs rose and final selling prices adjusted more slowly, profitability declined last year,” says Jolanta Grašienė, Vice President of SBA Group.
According to the audited data, SBA Group’s consolidated sales in 2021 amounted to EUR 404.6 million, an increase of 18.1% compared to 2020 (EUR 342.5 million). The consolidated loss amounted to EUR 8.3 million.
In 2021, SBA Group companies invested EUR 102 million in the implementation of strategic projects and the introduction of efficient technologies. The largest investments are in the construction of Inno Line, the region’s most robotised furniture factory near Klaipėda; the conversion of Kauno Baldai; and the development of the Verde business centre in Riga, which is owned by the SBA’s investment management company, Capitalica Asset Management.
In 2021, 176 new jobs were created in Lithuania as a result of the expansion of production capacity in SBA Group companies. In total, the SBA Group employed 4,750 people in Lithuania.
According to Grašienė, the promising start of the year was derailed by Russia’s military invasion of Ukraine. Raw material supplies from the East were disrupted and SBA also suspended the operations of the furniture manufacturing company Mebelain. The Group’s teams have made and continue to make significant efforts to find alternative suppliers and routes for raw materials, but supply chains across Europe and beyond remain compromised.
In parallel, SBA companies continue to expand production capacity: the new Inno Line complex will be fully operational this year, as well as the completion of the new Kauno Baldai factory, the continued transformation of the textile sector, and the development of the real estate projects that have been launched.
In 2022, SBA plans to continue increasing sales. This will be significantly influenced by the rising cost of finished products. According to the SBA vice president, one of the key challenges this year remains the rising cost of energy resources. As energy resources represent a significant part of the cost of production in industrial companies, their high cost will have a significant impact on the financial performance of many manufacturers.
“Although prices of some raw materials are stabilising on the global markets, we have a conservative outlook for the next year and a half, at least for manufacturing businesses. There is significant uncertainty, both in terms of consumer expectations, energy market trends, and the geopolitical situation. We will therefore continue to focus on improving the efficiency of our businesses. A more coordinated and meaningful state response would help meet the unprecedented challenges facing the Lithuanian economy and businesses,” said Grašienė.
SBA Group operates in the furniture, textiles, and real estate sectors. It exports its products to 50 countries worldwide. SBA’s furniture manufacturing sector includes SBA Home, which owns Klaipėdos Baldai, Šilutės Baldai, Inno Line, Visagino Linija, and Mebelain. SBA also owns Kauno Baldai, a manufacturer of upholstered furniture. In the real estate sector, the Group’s subsidiary SBA Urban owns the business valley Green Hall in Vilnius and the business centre BLC in Kaunas. The company is developing the new residential area Nemunaičiai in Kaunas and e-commerce towns Urban Hub in Kaunas and Vilnius. The company also plans to develop a high-tech campus in Riga. Capitalica Asset Management, an investment management company owned by SBA, manages the Kaunas Dokas business centre in Kaunas, 135 in Vilnius, and is developing Verde, a modern office complex in Riga, as well as investing in green logistics projects through a specially established fund. SBA’s textile sector consists of Utenos Trikotažas together with Šatrija and Mrija. SBA also owns Robotex, which provides robotics and automation solutions for manufacturing, electronics, and logistics companies.
