The AVK Group delivers solid organic growth and improved earnings

Press Release by AVK Holding

Revenue increased by 4.1% from DKK 9.0 billion to DKK 9.4 billion and formed the basis for a net profit of DKK 620.6 million, corresponding to an increase of no less than 23.8% compared to the previous year. At the same time, the operating margin increased from 9.7% to 10.6%. The Group expects continued growth and improved results in 2025/26 with a focus on, among other things, automation, the green transition, and continued market development.

"Revenue was slightly below the planned level, while operating profit and profit margin showed a significant improvement. Progress has been ensured through organic growth, where acquisitions contributed a limited 0.3% of revenue compared to 13% the previous year. Despite continued slowdown in the economy in several key markets, AVK manages to deliver a satisfactory result. This reflects a solid business model with a broad geographical presence and strong positions across market segments. This strength is reinforced by AVK's continuous development and expansion of the product range globally,"  - Lars Kudsk, CFO of AVK.

Positive development in all fields

Among the factors that have influenced AVK's performance are a positive development in smart irrigation solutions in Italy, water supply and desalination projects in the Middle East, and general growth in the markets in India and Southeast Asia. In addition, the Group's continued focus on operational and process optimisation, and slightly falling raw material prices have had a positive effect.

Both of AVK's business units made positive contributions to the result. AVK Water Solutions achieved growth of 6.8%, partly driven by an increased share from the project markets, but also through growth in several markets. The important Chinese market remained subdued, as expected. AVK Advanced Manufacturing realised a growth of 10.6%, primarily due to strong sales of rubber components, components for the wind turbine industry, and pallets based on recycled plastic.

Massive investment programme with focus on production optimisation and CO₂ reduction

In the financial year, investments reached DKK 594 million, compared with DKK 433 million the year before. The investment programme, which is the largest in AVK's history, has been implemented across the Group with a focus on automation, capacity expansion and reduction of CO₂ emissions. As a key part of the investment program, AVK is expanding its facilities in the U.S. to ensure a locally anchored supply chain.

The substantial investments will continue in the current financial year:

"It is about creating a more resilient and locally anchored production while taking responsibility for reducing our climate footprint. For us, growth, efficient operations, and responsibility are inseparably linked," says Niels Aage Kjær, Chairman of the Board.

Energy efficiency improvements and green energy reduce CO2 emissions by 18.9%

The green transition is an integral part of everyday life in the AVK Group, where targeted efforts are made to reduce the Group's CO2 footprint.

The effort is based, among other things, on a combination of energy efficiency and increased use of green electricity in production. During the year, the share of green energy has increased from 32% to 52%, and at the same time, AVK's total CO₂ emissions have been reduced by 18.9% despite increased production and a higher level of activity.

2025/26 will be characterised by acquisitions and joint ventures

The Group completed one acquisition, the Danish-based Frese Metal and Stålstøberi, which has been a subcontractor to the AVK Group for a number of years.

"On the other hand, the current financial year is expected to be largely characterised by acquisition activity. The Group has already established an important joint venture and completed a business acquisition, and further acquisitions are expected during the year," says Lars Kudsk.

With effect from January 2026, AVK has established a joint venture, CK Partners, together with the Norwegian Cappelen Group. In the new company, in which AVK has a 51% shareholding, the activities will be brought together under Furnes Jernstøberi and Ulefos Holding, but both will continue the commercial activities as now with separate sales channels. The three foundries from Ulefos Holding and Furnes Jernstøberi, respectively, will operate in one organisation with the aim of ensuring an optimised production of manhole covers for the Nordic market.

AVK has taken over the production of valves for high-pressure applications from the Italian group, PetrolValves. The activity is integrated into AVK Industrial Solutions S.r.l. and contributes to further strengthening AVK's product range in both industrial market segments and water supply.

"AVK has a clear strategic focus on developing the Group through both organic growth and targeted acquisitions and joint ventures. This allows us to strengthen our market positions, exploit industrial synergies and create a more robust foundation for future growth," says Niels Aage Kjær.

Large order backlog supports expectation of growth of 9-11% in 2025/26

Although a number of markets will continue to be characterised by economic slowdown, AVK's expectations for the financial year 2025/26 are characterised by considerable optimism. The outlook is supported by a solid order backlog, among other things.

"The expected growth of 9-11% is expected to come from all business areas and is complemented by contributions from the established joint venture and completed acquisitions. At the same time, AVK has built up a stronger position in relation to larger projects," says Lars Kudsk.

He also points out that after a number of years with significant challenges, Flonidan is now in the process of extensive deliveries of smart gas meters to the Dutch market. In addition, AVK Tooling's sales to the wind turbine industry are again at a high level after some weak years, and overall, this is expected to contribute significantly to growth in the current year.