A safe and sustainable world

Annual report 2022

MANAGEMENT’S REVIEW

Difficult conditions challenged growth plans

FORCE Technology entered the year 2022 with serious ambitions. It sought to achieve growth in the number of employees, investments, revenue, and profits. However, the coronavirus pandemic, strained supply chains, war in Europe, inflation, and the energy crisis made achieving our goals difficult. 

Unpredictability has persisted in recent years, and 2022 was no exception. Rapid adaptation and flexibility have become part of our day-to-day operations, but they can only go so far in offsetting some of the impact on our finances. In particular, the first half of 2022 was characterised by a general decline.

The coronavirus pandemic was still a factor for much of the world, and combined with strained supply chains, we could not fully leverage our capacity despite the large volume of orders we received. This resulted in missed deliveries for our customers. For instance, our gas calibration division faced logistical issues with customers’ meters sent in for calibration. Additionally, sanctions brought about by the war in Ukraine meant that some customers could no longer receive our services. In other business areas, a shortage of skilled labour impacted our growth ambitions. Furthermore, the energy crisis and inflation resulted in significantly higher expenses. These factors combined made the first half of the year especially challenging.

In the second half of the year, conditions gradually improved. We once again achieved growth, although our revenue and earnings fell short of initial expectations. Issues with procuring electronic components and equipment continued through the year, which particularly impacted deliveries to customers in the wind industry. High energy prices, especially in the second half of the year, led us to impose a variable energy surcharge on customers in Denmark. In concert with an internal energy-saving campaign, this allowed us to cover our additional energy costs. Rising inflation also resulted in generally greater expenses, leading us to raise prices twice in 2022.

Higher turnover but lower earnings

Despite the unfavourable conditions, our revenue increased in 2022 by 44 million DKK to 1,063 million DKK, corresponding to growth of 4.3%. In Denmark, our NDT Services division succeeded in both compensating for the loss of a major customer in 2021 and becoming the single greatest driver of growth in 2022. The implementation of the 2024 Strategy also produced greater revenue, particularly in the wind industry, despite setbacks from logistical challenges and component shortages in this area. The energy surcharge and price adjustments also contributed significantly to the increase in revenue.

On the other hand, our expenses also increased in 2022. While rising energy costs were covered by the energy surcharge, our price adjustments were not fully able to compensate for general price increases among our suppliers.

Increased 2024 Strategy activity, IT security, and compliance measures also resulted in greater expenses. Our EBIT were 4 million DKK, down by 12 million DKK relative to 2021.

This can be considered satisfactory in view of the difficult conditions and the continued implementation of the 2024 Strategy. 

Progress in subsidiaries

While the Danish portion of the business struggled to meet expectations, our Norwegian subsidiary had more favourable news to report in 2022. FORCE Technology Norway AS increased its revenue by 15 million DKK despite closing down its structural analysis division, ending 2022 with a profit of 8 million DKK — its best performance since 2014.

In Sweden, DELTA Development Technology AB continued its investments with a complete renovation of its EMC facilities. The temporary closure caused revenue to fall by 4 million DKK relative to the previous year, for an overall decrease in profits of 5 million DKK relative to 2021. However, the project was completed more rapidly than planned; consequently, both revenue and profits for 2022 exceeded expectations.

In 2021, our AeroCollect subsidiary concluded a sales and distribution agreement with INDICAL Bioscience Switzerland AG, contributing to revenue of 2 million DKK for 2022, although the subsidiary recorded a loss of 4 million DKK. Customers see significant potential in the technology, but it is taking more time than expected to replace existing methods.

Social responsibility and sustainability

Taking social responsibility is one of FORCE Technology’s fundamental values. To that end, sustainability is an important element of our internal and external strategic focus. In 2022, we developed our first sustainability strategy. Our goal with this strategy is to take greater social responsibility and contribute to achieving the UN’s sustainable development goals for 2030.

This strategy is divided into key areas: the climate and environment, social sustainability, financial sustainability, and indirect impacts through our customers’ use of our products and services—sometimes referred to as a “handprint”. In the climate and environment area, we aim to reduce our emissions and environmental impact while optimising resource consumption. In the social sphere, we are focusing on health, safety, and diversity, as well as on how to act in a socially responsible manner when dealing with employees, customers, and partners. In the financial sphere, our strategy sets out how we can run a healthy business, focusing on documentation and providing management with a solid decision-making foundation.

A climate statement has been prepared for FORCE Technology in Denmark based on the year 2019, with a total CO2 eqv. contribution of 8,091 tonnes. Using this information, we have set a specific target to minimise our impact on the climate. We aim to reduce our CO2 emissions by 25% from 2019 to 2024 relative to revenue developments. In 2022, our emissions totalled 6,405 tonnes of CO2 eqv., corresponding to a 21% reduction; thus, we are already close to achieving our target. Beginning in 2023, our locations in Norway and Sweden will be included in our climate statement.

ledelsesberetning 2022

As part of our social sustainability work, we are actively engaged in promoting gender diversity, and we signed DI’s Gender Diversity Pledge in 2021. In 2022, we also set specific targets for gender diversity within the company.

In 2021, female employees made up 22.5% of our workforce, and our goal is to reach 25% by the end of 2024. In 2021, female managers made up 18.7% of all managers, and our goal for 2024 is 22%. Not including those elected by employees, women made up 25% of our board of directors; our target for 2024 is 33%.

At the end of 2022, women made up 24.1% of all employees and 21.1% of all managers. Not including those elected by employees, women make up 40% of the board of directors. We are thus close to our targets in all three categories, and have even exceeded our target for the board of directors. Apart from attracting more women to FORCE Technology, we are also focusing on retaining female employees.

One of the tools we are using to achieve our targets for 2024 is the equality plan we developed in 2022, in which we identify, measure, and make plans to eliminate any gender-based inequality in the company. As part of our efforts to attract more women, particularly in technical fields, we have also increased our focus on recruitment. This focus is expressed through such factors as the wording of job postings and applicant screening practices.

In our efforts to ensure transparency, we have decided to make public data on the combined remuneration to our executives and directors. In 2022, this amount was 5.1 million DKK, plus 0.2 million DKK in directors’ remuneration in FORCE Technology Norway. Similar remuneration were not paid out at other foreign subsidiaries. Remuneration were issued to 15 board members and one executive.

A future with restrained growth

FORCE Technology is financially and strategically well-equipped to enter the year 2023, but high inflation, the energy crisis, the risk of a recession, and labour market challenges have tempered expectations for growth in the year to come. In view of this, we expect an increase in revenue of 4% to 5%. Continued investment in 2024 Strategy activities and significantly higher financing costs lead us to expect profits on par with 2022.   

FORCE Technology CEO Hanne Christensen

Hanne Christensen

CEO

Jesper Haugaard

Chairman of the board

Per Michael Johansen

Vice chairman

ECONOMIC KEY FIGURES

Turnover

0

MDKK

OPERATING PROFIT

0

MDKK

EMPLOYEES

0

market areas

Off to a good start with the 2024 Strategy

In 2021, FORCE Technology launched a new strategy that sets a new direction and specific goals towards the year 2024. Six new market areas made their débuts. This section provides updates on how things are going in Power-to-X, life science, circular economics and resources, wind energy, and hybrid testing.

Globe animation

Power-to-X

In the early years of this strategic period, this market area has been focused on three sub-areas: CCUS, component suppliers, and Power-to-X systems. In the autumn of 2022, FORCE Technology also published a survey and analysis of opportunities in this area in collaboration with three other GTS institutes: DBI, the Alexandra Institute, and the Technological Institute.

Life Science

Our ambition is to double our revenue in the life science industry by the end of 2024. In view of this goal, we have concluded framework agreements with several of Denmark’s largest pharmaceutical and biotech companies. We have also launched numerous R&D projects and expanded our collaboration with the Danish Life Science Cluster.

Resources and circular economy

In the first part of the strategic period, we have focused on identifying which products and services we are already offering, which new ones we need to develop, and how we can best sell them now and in the future. Focus areas include reuse and lifetime extension, sustainability in design, and sustainability documentation.

Wind energy

Wind is an area in which we already hold a strong position, which will be further expanded within the scope of the new strategy. We have increased our focus on the United States and Asia, where this area has seen a high volume of activity and many market opportunities in recent years. Strained supply chains have caused problems in the early part of this strategic period, but there are signs of improvement, and incoming orders appear promising.

Defence & space

In light of the war in Ukraine, 2022 saw an increased focus on the defence industry. As policymakers prioritise the Danish military and the end of Denmark’s EU defence opt-out, we see potential in strengthening existing good relationships with the defence and space industry. To that end, we established a new market area for this sphere in late 2022.

Hybrid tests and digital services

We aim to develop digital solutions that benefit our customers and us alike. To that end, we have surveyed our existing digitalisation efforts and begun developing new digital solutions along three lines: digital workflows, customer portals, and automated test result collection. Numerous digital services have been launched on the market to great success, including SenseLabOnline and SimFlex Cloud.

We take responsibility

As a GTS institute, FORCE Technology has a special role in society, and that role comes with special obligations and responsibilities. We aim to make the world safer and more sustainable. To that end, we are actively working to minimise our CO2 emissions, promote diversity, and refine technologies, making them available to businesses through participation in research and development projects.

Carbon footprint

FORCE Technology strives to make the world safer and more sustainable. For that reason, we prepare a climate statement every year, allowing us to use the right data to set ambitious targets for reducing our emissions.

Distribution of CO2 emissions in 2022:

2022 emissions

Gender diversity

As part of our social sustainability work, we are actively engaged in promoting gender diversity. We have signed DI’s Gender Diversity Pledge, and in 2022, we set specific targets for gender diversity in our company.

24.1 % of managers were female in 2022

Female employees in 2022:
24.1 %
Goal in 2024: 25 %

21,1 % of managers were female in 2022

Female managers in 2022:
21.1 %
Goal in 2024: 22 %

40% of board members were women at the end of 2022

Female board members* (excluding employee elected)  in 2022:
40 %
Goal in 2024: 33 %

* The proportion of female board members incl. employee elected members is 50 %.

Research and development

As one of the large GTS institutes in Denmark, we are an important part of the Danish innovation system, and through participation in R&D projects we help mature new technologies and make them available to companies. In 2022, we had record R&D activity – and increased participation in national initiatives.

R&D projects

151

R&D revenue, MDKK

107

Clusters and standards

Knowledge partner in 12 of 13 clusters
Member of the board in 6 of 12 clusters
Member of 176 standardization committees

Professional clubs

12 professional clubs
1,500+ individual members
530+ member companies

Courses and webinars

245 courses
20+ webinars
3,700+ participants

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