Genan: “Back on track” in 2023 following “annus horribilis”

Danish firm Genan, the world’s largest mechanical tyre recycling group, achieved a turnover of €58.7 million in 2023. This represents a seven per cent decrease compared to the previous year. However, despite the lower turnover, the company increased its EBITDA by over 50 per cent to almost €9.4 million, while operating profit (EBIT) multiplied from just over €750,000 to €3.2 million. Net profit, influenced negatively by exchange rate fluctuations, increased from €1.5 to €2 million. The company regards these results as satisfactory, sharing in a statement that it anticipates a continued positive development of financial indicators for the year 2024.
“After a challenging 2022, large environmental company Genan is back on track.” The company adds that its position as a crucial player in tyre recycling continues to strengthen, with more countries recognising the necessity of converting end-of-life tyres into new and reusable raw materials.
“There is no doubt that global attention towards the green transition is grist to our mill,” says Poul Steen Rasmussen, group chief executive officer of Genan Holding. “Just few years ago, we had to explain our business concept and argue for its relevance. Today, no one questions that recycling should be on the agenda, although unfortunately, there are unfortunately still countries, also within the EU, that prefer to export used tyres to other continents for them to be used in processes which are more or less harmful to the environment.”
Challenges at “different level” to 2022
Rasmussen described 2022 as a “annus horribilis” due to external factors such as explosively rising energy and freight prices. He added, “Energy prices were still relatively high in 2023, but at a completely different level than 2022. Moreover, we have increased focus on power supply of green energy, while witnessing global freight prices fall.”
The chief executive officer also pointed out other factors influencing turnover and profit. Price adjustments made by Genan in 2023 due to increasing inflation and energy prices had both negative and positive impacts on turnover and profit. Furthermore, the EU ban on the use of rubber granules in artificial turf pitches, effective from 2031, is already affecting demand for this specific application in the European market.
Despite the challenges, Rasmussen expressed optimism for the ongoing fiscal year, emphasising that he, along with the rest of the management and ownership group, “have a positive outlook” towards the current year and the coming years, expecting an increase in both turnover and profit for the company in 2024.
Genan is owned by the two main shareholders Maj Invest Equity and PKA and operates six production sites, one each in Denmark, Portugal, and the USA, and three in Germany. The total production capacity exceeds 400,000 tonnes of end-of-life tyres (ELT) per year, with primary raw materials from the factories consisting of up to 300,000 tonnes of rubber products and 60,000 tonnes of steel.
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