- April 14, 2021
- Festo Corporation
In the 2020 financial year, the Festo Group had to cope with a 7.5% decline in turnover due to the pandemic, but was able to close with an overall operating result above the previous year. The workforce was also guided through the crisis in a stable manner. After a strong first quarter, the company expects a catch-up year in 2021. With smart and intelligent products as well as digital learning platforms, Festo supports the structural change in industry and society–from electromobility to vaccine production and laboratory diagnostics to energy efficiency and climate-neutral production.
Financial years 2020/2021
Festo proves economically stable and has mastered the pandemic well so far. The Festo Group had to cope with a 7.5% decline in turnover in the 2020 financial year due to the pandemic. Turnover was 2.84 billion euros (previous year 3.07 billion euros). Overall, however, thanks to forward-looking cost-cutting measures and employment protection, the operating result in 2020 was slightly higher than in the previous year.
“This has enabled us to guide our workforce safely through the crisis year and to create a good basis for being ready for the global economy to pick up again. At the same time, it gives us the financial freedom to invest in our future now as well,” said the Chairman of the Management Board, Dipl.-Ing. Dr. h.c. Oliver Jung.
As in the previous year, the company’s R&D ratio was 8% of turnover.
In recent years, Festo has invested heavily not only in Europe, but also in the growth regions of North America and Asia. With the approach “In the region for the region," Festo has high-performance supply chains, which also now function securely globally and locally in the crisis.
For 2021, the company expects a catch-up year. “We started the year well, with strong growth in the first quarter. Nevertheless, the end of the pandemic cannot yet be estimated. We are therefore continuing our savings course. At the same time, we continue to invest in our growth and innovation strategy,” Dr Oliver Jung affirmed.
Implementation of the new Strategy 2025+ is in full swing. The focus is on growth and performance, innovation and future markets, digitalization and artificial intelligence (AI), and sustainability.
Digitalisation and AI determine the product roadmap with smart and intelligent products and are enablers for energy efficiency and sustainability in customer solutions.
Festo is focusing on the capability shift, the qualification of employees in the digital transformation.
"The structural change in many sectors is clearly noticeable for us, from the electronics industry to electromobility and life tech. Electrification in the automotive industry is just gaining massive momentum. We are seeing strong demand for automation solutions for the production of electric vehicles and vehicle electronics as well as battery production. In addition, there is a great demand for qualification in the entire spectrum of electrification. This offers us great growth opportunities for the next few years,” explained Dr. Oliver Jung.
The need for home schooling and virtual training (Digital Education) is growing rapidly in the pandemic. In the lockdown, Festo Didactic successfully launched its new digital learning platform, Festo LX, for technical education and provided a free homeschooling version for mechatronics courses in schools.
The LifeTech business segment with medical technology and laboratory automation is experiencing a real boom with growth rates of over 100%. Festo is continuously expanding its Technical Engineering Center for LifeTech in Boston, which opened in 2018 and is one of the world’s most important development locations for life science, in order to further develop this promising growth market.
Festo’s products make an important contribution to the fight against COVID 19. In particular, laboratory automation enables high throughput in COVID 19 tests. Automation is also key in vaccine development and production.
“Automation is the prerequisite for us to be able to supply and treat people worldwide quickly, safely and affordably in high medical quality–be it with medicines and vaccines, respirators or medical devices. We will therefore continue to strongly expand our LifeTech business in the coming years,” said Dr Oliver Jung.
Sustainability needs automation and education
“As a company and society, we have to manage the balancing act in the pandemic of simultaneously finding ways out of the crisis and focusing our future activities on sustainability. Automation and technical education are a key to this. We also have a high social responsibility for sustainable development here,” said Dr Oliver Jung. The goal is to gradually develop production in the direction of a circular economy.
“At Festo, we are convinced that pneumatics in particular offers massive advantages over electrics in many areas, and that no other technology can match it. We are currently developing this further in the direction of smart and digital pneumatics. There is still a lot of potential here,” confirmed Dr Oliver Jung.
In 2020, Festo has also made great progress internally in climate protection and thus towards its climate target of saving at least 30% CO2 by 2025 (Scope 1 and 2).
Festo has the greatest leverage for climate protection with its customers, through the appropriate product selection of pneumatics and electrics (Scope 3). This is because around 90% of CO2 emissions are generated during product operation and only around 10% during production. Smart products and services, digitalisation and AI are giving new impetus to energy efficiency on the way to CO2-neutral production.
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