A Word from the CEO

The Flokk portfolio now consist of brands and products which can serve the entire seating needs of our customers. We are therefore now able to address the market as a total solution seating solution provider, not just a manufacturer of office chairs. We have developed this offering significantly in our core markets through 2021 and see high potential in leveraging this position to continue winning market share going forward.

This position has enabled us to benefit from work trends that have grown stronger over the past couple of years, partly driven by the global pandemic. The key word is flexibility. Offices are increasingly set up with a mixture of desks with task chairs, collaboration areas, meeting rooms and lounges with soft seating.

These trends require a broad product offering across all seating categories, which Flokk supplies. It also enlarges the potential market, as businesses invest in more chairs and other seating products in more collaborative workspaces, in addition to the employees’ personal workspaces .

Furthermore, this new flexibility also implies working from home, either all the time or some of the time. This also offers a larger potential market for Flokk, with other requirements and preferences than the traditional office market.

The HÅG Tion task chair, which we launched in 2021, exemplifies this. With its minimalistic and elegant design, Tion is perfect for home offices as well as shared workspaces. Tion illustrates the substantial efforts Flokk puts into product design and development. We spend significant resources on improving existing products and designing new ones and have built a strong track-record of delivering high returns on these investments on an ongoing basis.

Additionally, the quality is first-rate. HÅG Tion comes with a 10-year warranty, and the core components are designed to last much longer. It is designed for disassembly, meaning that parts can easily be exchanged for repairs, and in the end, the parts can be recycled. Instead of buying off-the-shelf components, we design all key components ourselves, with recycling in mind. And lastly, the Tion has few components and is extremely lightweight, giving it a smaller carbon footprint.

Sustainability has been in Flokk’s DNA for decades, and that DNA carries through to our products, services, and processes where we set strategic targets to be resource and energy efficient, to generate minimum greenhouse gas emissions, and to not present a risk to health or the environment.

There is also efficiency in scale, and Flokk has pursued a long-term M&A strategy to consolidate the fragmented European industry as an addition to organic growth. We believe there is a compounder effect in our M&A strategy, as the acquired companies are integrated and trend towards best practices in the group, increasing the scale and profitability both in the existing and new brands. One such transaction that we started working on in 2021was the formerly mentioned acquisition of the UK firm Connection, which we announced in March of 2022. By combining Connection with our existing UK operation, we join the major league in the strategically important UK market, the second largest office furniture market in Europe. We gain an excellent position with architects and designers in the project market, leveraging Connection's strong offering within flexible workspaces and soft seating,supported by Flokk’s existing brands, primarily H.G, RH, Profim and Offecct.

The quest for efficiency extends to finances as well. In 2021, we sold the facilities in Koblenz, Tibro and Hunnebostrand in order to release capital that we can better utilize to pursue organic growth and acquisitions.