Investment and research and development projects
General information on investments
Investment projects have been drivers of engineering development and a source of competitive advantage.
Investments are planned within a several-year horizon of a strategy, which are further verified every year for the possible market changes.
Decisions on the performance of major projects are made based on detailed analysis of each task, in consideration of their economic effectiveness (rate and period of return) as well as risk level, and are preceded with assessment and recommendation by the Investment Committee operating within the Central Area.
The investment projects carried out by the Capital Group under the 2021-2025 Strategy are mainly focused on the Capital Group organic development.
They comprise specifically improvement of production capacity by construction and extension of production facilities and warehouses, as well as furnishing the halls with state-of-the-art machinery.
All that occurs in response to the growing customer requirements, changing legal regulations, as well as care for the natural environment and staff safety.
Adequate funds are also allocated to maintenance of the existing production capacity, by replacement, modernisation, or improvement of effectiveness (replacement projects).
Within the last 10 years, capital expenditure of the Capital Group amounted to roughly PLN 2.2 billion.
Investment projects in 2023
The Capital Group expenditure on investment projects in 2023 equalled PLN 316 million, compared with PLN 310 million in 2022.
Within the EPS, capital expenditure amounted to PLN 169 million and comprised mainly the construction of a new production hall and two extrusion presses with tools and accessories, development of aluminium components production at the Slovenian plant and in Kęty, as well as production tools (dies).
The value of capital expenditure incurred by the ASS in 2023 amounted to PLN 117 million and covered mainly the construction of a new plant in Złotów, commissioning of two powder coating shops, purchase of a line to manufacture roller-shutter systems, as well as replacement projects.
The FPS capital expenditure reached PLN 17 million and covered mainly replacement projects.
Grupa KĘTY S.A. expenditure on investment projects in 2023 equalled PLN 145 million, compared with PLN 130 million in 2022, representing a growth of 11% y/y. Apart from the projects related to the Extruded Products Segment, tasks were also performed within the Central Area, mainly in relation to the development of IT systems and infrastructure.
The description of the major investment projects carried out in 2023 by the particular Segments may be found in section ‘Operating activities at the business segments’.
In 2023, the Capital Group did not make any capital investments.
Assessment of the viability of the investment projects planned
The 2021-2025 Strategy of the Capital Group assumes capital expenditure of PLN 1.3 billion, out of which PLN 304 million is planned for 2024. The projects will be financed from the Company own funds and from bank loans.
Considering the current financial standing of the Capital Group, safe debt and liquidity ratios, as well as the bank finance acquired in 2023, as at the date of this report the Management Board of the Company does not expect any problems with financing the planned investment projects.