Harvia FY 2022: Revenue Down 3.7% as Pandemic Demand Normalizes
By Arlene Scott
Senior Wellness Correspondent & Hospitality Consultant
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Harvia’s 2022 full-year revenue of EUR 172.4 million was down 3.7% from the pandemic peak, but the company held adjusted operating margin at 21.1% as management worked through channel destocking.
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Harvia Plc reported full-year 2022 revenue of EUR 172.4 million on 9 February 2023, down 3.7% from the pandemic-era peak of EUR 179.1 million in 2021. The print closed out what management would later call the company’s most complicated year as a public entity: a double hit of post-pandemic demand normalization and a European consumer retrenchment driven by the Russian invasion of Ukraine, energy costs, and rising rates. Adjusted operating margin finished the year at 21.1%, down from 26.4% in 2021. (Next year: FY 2023 turnaround. All earnings in context: Harvia News hub.)
The pandemic overhang
Harvia’s 2020 and 2021 results had been unusually strong. The company had ridden the wellness-at-home wave: EOS consolidated in spring 2020, revenue jumped 47.3% in 2020 to EUR 109.1 million, and then another 64.2% in 2021 to EUR 179.1 million, with Kirami contributing a partial year. Management had been explicit with investors that some of that demand was pulled forward from future periods, and in July 2022 the company pre-announced that Q2 demand had materially softened.
The 2022 print confirmed the pre-announcement and added Central European detail. Germany and adjacent markets carried the heaviest destocking as dealers worked down high inventory. Russia had accounted for EUR 11.5 million of 2021 sales; it fell 35.5% to EUR 7.5 million in 2022 after Harvia suspended its Harvia-branded Russian operations in March and agreed in November to sell its 80% stake in EOS Russia. North America, Asia-Pacific, and the UK continued to grow.
Advance demand during the pandemic has ended. We see the sauna and spa market returning to more normal growth patterns, but the adjustment year has been uneven across regions.
Regional composition
North America, already the largest non-European region, kept growing through the year on the back of Almost Heaven momentum and specialty dealer expansion. APAC & MEA continued its multi-year trajectory, with Japan and China growing off small bases. Northern Europe (Finland, Sweden, Norway) was broadly flat. Continental Europe was where the pain landed, with Germany down sharply year over year.
Margin walk
The margin step-down from 26.4% to 21.1% adjusted had three drivers: (1) Revenue decline against a partly fixed cost base; (2) high inventory at year-end, which would have to be managed down through 2023; (3) sales and marketing investment to stimulate demand in softening markets. Management was clear that none of these were structural, and that the 20%+ long-term margin target remained intact.
Analyst questions and tone
On the Q4 earnings call, Helsinki-based Inderes and the Danske Bank Markets analyst pressed on three themes: how long European destocking would last, whether North America growth could sustain into 2023, and whether the dividend was safe. Management declined to quantify the destocking tail but said they expected Q1 2023 to remain soft with gradual improvement through the year. On North America, CEO Tapio Pajuharju was direct: the dealer channel was healthy, the product mix was improving, and US consumer demand was not tracking European weakness. The dividend was reaffirmed.
Capital return
Harvia’s board proposed a total dividend of EUR 0.64 per share for 2022, to be paid in two instalments, up from EUR 0.60 for 2021. The increase kept to Harvia’s policy of a regularly increasing dividend: the company’s balance sheet was in good shape, and leverage of 1.3x was below the 1.5x to 2.5x target range.
Management set expectations for 2023 to be a year of destocking completion, margin recovery, and continued North American investment. The 2023 Q1 interim report was scheduled for 4 May 2023. Inderes maintained coverage and raised the question of whether M&A would resume once the European environment stabilized, a theme that would play out in 2024 with ThermaSol.
FY 2022 was the reset nobody on the Nasdaq Helsinki sauna bull case wanted to see, but it was survived well. Margins held near long-term target, the balance sheet absorbed the demand shock without strain, and management narrated the situation clearly enough that analysts stayed constructive. In hindsight, 2022 set up the 2024 and 2025 reacceleration by forcing discipline on working capital and cost structure during a weak year.
Correction, September 25, 2026: an earlier version of this article said 2022 operating profit was EUR 33.1 million (19.2%) and adjusted operating profit EUR 33.9 million (19.7%), that the 2021 adjusted margin was 22.4%, that 2020 revenue was EUR 104 million (up 43.7%) and 2021 growth 72%, that Russian revenue went to about zero in 2022 from about EUR 5 million, that leverage was about 0.9x, that the dividend was cut to EUR 0.65 from EUR 0.70, that Matias Järnefelt was CEO, and that the Q1 2023 report was due 3 May. Operating profit was EUR 34.7 million (20.1%) and adjusted operating profit EUR 36.5 million (21.1%), the 2021 adjusted margin was 26.4%, 2020 revenue was EUR 109.1 million (up 47.3%) and 2021 growth 64.2%, Russian revenue was EUR 7.5 million (EUR 11.5 million in 2021), leverage was 1.3x, the dividend rose to EUR 0.64 from EUR 0.60, Tapio Pajuharju was CEO, and the Q1 report was due 4 May 2023, per Harvia’s Financial Statements Bulletin 2022 and Financial Statements Bulletin 2021.
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