Impact of covid-19 on Lindab Group

October 2020
Lindab has the construction industry as its primary target segment and sales are concentrated in Europe with less than two percent of sales outside of Europe. Sales are affected by activity in the European construction industry, with emphasis on the countries in Northern Europe.
During the third quarter, Lindab was primarily affected by lower construction activity in Italy, France, the United King­dom, Poland, Hungary and the Czech Republic. The demand for Lindab’s products in the Nordic region has remained good.
Lindab’s goal is to keep factories, distribution centers and sales channels open as far as possible. Lindab customers value high availability and delivery precision. By ensuring that critical deliveries can be made, Lindab strengthens its com­petitiveness and increases customer loyalty. During the third quarter, operations were open in all countries, with reduced opening hours and staffing in the countries with the lowest construction activity.
Lindab has good possibilities to secure deliveries to custom­ers thanks to over 30 production facilities around Europe. Local stock levels have increased to further reduce the risks. Lindab has limited dependency on raw materials and com­ponents from countries outside Europe, which reduces the risk of transport disruptions. Alternative suppliers have been used when deemed necessary and this has thus reduced the dependency on individual suppliers.
At Lindab’s facilities, routines have been introduced to prevent the spread of infections and to increase the safety of employ­ees. For confirmed covid-19 cases among Lindab’s employ­ees, measures have been taken to prevent further spread of the infection. Protective equipment has been put on stock to secure future availability.
Lindab’s assessment is that covid-19 will affect sales nega­tively during the coming quarters. Construction projects are delayed or postponed and it is unclear how long and to what extent restrictions will last.
Lindab has reduced the costs to adapt the business to a lower demand. During the third quarter support measures and short-term work has been used to a lesser extent in the countries that were most affected.
Lindab has a strong financial position. Efficiency measures have resulted in a solid balance sheet and a strong result. The development is closely monitored and Lindab continuously evaluates different scenarios to be able to adapt operations to prevailing circumstances.