In 2023, Danfoss continued to make bold investments in expanding the offering of competitive and innovative solutions despite a slower growth environment.

Chennai, March 11, 2024 – With our 2023 results, the positive development of Danfoss continued with bold investments in our green growth strategy, Core & Clear 2025. Despite market headwinds in the second half of the year, Danfoss reported financial results within the range of guidance.

Sales grew 7% in local currency compared to 2022, with the EBITA margin reaching 12.6% in 2023. This is combined with a record-level free operating cash flow after financial items and tax of EUR 692 million, an increase of 49% compared to 2022. EBITA increased 10% to EUR 1,345 million compared to 2022.

Mr Ravichandran Purushothaman, President, Danfoss India, said, “I am proud to witness our continued positive trajectory amidst global economic headwinds. Our steadfast commitment to innovation and sustainability has enabled us to achieve remarkable results, evident in our 2023 performance with a 7% increase in sales and a significant reduction of 18% in scope 1 and 2 emissions. At Danfoss, we're joining hands with communities worldwide to recognise the power of energy efficiency in shaping a sustainable future. As we strive towards a greener tomorrow, let's acknowledge the impact of our collective efforts in conserving energy, reducing emissions, and mitigating climate change. With our clear roadmap to decarbonise operations by 2030, including strategic agreements in key markets like China and North America, we are poised to further elevate our impact and drive sustainable growth in the Indian market and beyond. At Danfoss, we have the expertise and technology already to take action on decarbonisation through energy efficiency. Using the three-step process, we can achieve rapid and cost-efficient decarbonisation, reduce energy consumption and waste, reuse energy through energy recovery and sector coupling, and resource energy with renewables.”

“We are entering a new era where the future energy system is electric, and improving energy efficiency in machines, infrastructure, and industry is critical to delivering an affordable, secure, and decarbonised future. In 2023, we continued with bold investments in expanding our offering of competitive and innovative solutions for our core business and high-growth opportunities like data centers, the electrification of heating systems, EVs, on- and off-highway vehicles, as well as marine vessels, and hydrogen production,” says Kim Fausing, President & CEO of Danfoss.

Besides the significant investments in our core business and new high-growth opportunities, we continued to invest in building a more resilient supply chain by further regionalisation and adding new capacity.

In 2023, the integration of our recent acquisitions continued to be on track.

With the acquisition of Eaton’s hydraulics business in 2021, we built a leading position within mobile and industrial hydraulics. We are targeting a leading position in power semiconductor modules and assemblies with Semikron Danfoss, established in 2022. With the acquisition of BOCK® Compressors in 2023, Danfoss now offers one of the most comprehensive compressor portfolios in the cooling industry.

“During the second half of 2023, high inflation and interest rates impacted the market. The more challenging business environment has continued into 2024, but we remain focused on implementing our green growth strategy and delivering strong value to our customers and partners around the world,” says Kim Fausing, President & CEO of Danfoss.

Danfoss has a clear plan to decarbonise operations by 2030, and we already have agreements in place that ensure a 30% reduction in emissions. These agreements include two long-term power purchase agreements in China and North America, effective from 2024 and 2025, respectively. In 2023, we continued to decarbonise our own operations. Scope 1 and 2 emissions decreased by 18% (before acquisitions), decoupled from organic sales growth of 2%.

“I am excited to see how our global teams continue to implement our green growth strategy and at the same time decouple our organic growth from our own emissions,” says Kim Fausing.