Message from the Chairman

Dear Shareholder,

The global economy is expected to have grown by approximately 3.1% in 2023, a slower rate than in the previous year and below average annual growth in the decade prior to the pandemic. The pace of growth, however, was clearly stronger than expected, despite the slowdown registered in the most developed economies. Geopolitical instability, the ongoing war in Ukraine and the escalating conflict between Israel and Palestine, together with numerous other smaller but interconnected conflicts, placed additional pressure on the global economy, posing new challenges for trade and supply chain management. The economic climate was particularly demanding for companies, with inflation rates above desirable levels, restrictive monetary policies, rising interest rates and reduced global demand.

Corticeira Amorim’s consolidated sales totalled €985.5 million in 2023, a slight decrease compared with the record value recorded in 2022, due mainly to lower activity levels, especially in the flooring sector, and the impact of unfavourable exchange rates. It is worth highlighting the remarkable performance of Amorim Cork (cork stoppers) in relation both to the market and to the competitors, consolidating market share.

The performance overall was nevertheless highly positive in 2023, with a significant improvement in EBITDA and an increase in the EBITDA margin to 18%. Despite the negative impact of increased cork consumption prices, our operational performance was remarkable, reflecting a better sales mix and significant cost savings, mainly due to lower electricity and transport prices and the implementation of production efficiency measures. The 2023 cork purchasing campaign provided for an improvement in stocks that should stabilise future raw material supply. Consolidated net earnings totalled €88.9 million.

The year was also one of large investments. We planted more than 200,000 cork oaks and will plant another 250,000 in 2024, adopting a new science‑based cork oak culture model that, we are confident, will radically increase the productivity and profitability of cork oak forests. In the energy sector, we continue to implement photovoltaic projects, which will enable us to produce, already in 2024, energy for our own consumption corresponding to about 20% of our electricity needs. Our research and development programmes enable us to continue innovating and to bring to market applications and products that combine know‑how, technology, and the natural, surprising and irreplaceable material that is cork. Continued investment in new technologies and applications has generated excellent results, demonstrating the potential of cork to move beyond its current uses.

More than ever, we have a vision and an approach based on the whole value chain of cork: from forest to the satisfaction of our more than 30,000 customers worldwide across a wide range of sectors. Ours is a responsible and committed approach, aligned with the expectations of our stakeholders and with 12 of the 17 Sustainable Development Goals set out by the United Nations.

Respect for the montado (cork oak forest) habitat and the invaluable services it offers humanity is a fundamental value of our culture, one that is especially expressed in the way we conduct our business activities: in perfect harmony with nature. Across the world, our people work to protect the cork oak, to rigorously manage resources and impacts, to promote the use of cork products and solutions to reduce carbon footprints and to embrace enthusiastically our common causes, that is, to improve social and environmental well‑being and prosperity for all.

The outlook for 2024 is still uncertain, but we remain confident, aiming for another positive year. This will require resilience and hard work from all of us. Taking into account the investments we have made, particularly in technologies used in different areas of all our Business Units, we aspire to continue providing innovative products and solutions, to conquer new markets and to strengthen our profitability levels.

The challenges are immense, but our determination is even greater.

Best regards,
Antonio Rios de Amorim
Chairman and CEO