In this Research Note, we examine the Belimo Group, based on their 2022 annual report, investor presentations, financial results announced on 6th March 2023 and their long-term growth strategy in the building automation field devices sector.

Belimo Group, a listed company on the Swiss Stock Exchange, is headquartered in Hinwil, Switzerland with over 2,000 employees. The group is a market leader in field devices for the energy-efficient control of HVAC systems. The focus of their core business is on damper actuators, control valves, sensors and meters.

Belimo posted strong 2022 results in a demanding environment. With an organic sales growth of 11.9% in local currencies, 2022 revenue developed ahead of the five-year growth average (compound annual growth rate 2016–2021) of 8.8% in local currencies. In Swiss francs, net sales grew 10.7% to CHF 846.9 million (over $904 million). Despite substantial increases in material expenses and higher freight costs, Belimo achieved a robust operating result. Earnings before interest and taxes (EBIT) was CHF 152.4 million, amounting to an EBIT margin of 18.0%.

Belimo Growth Strategy

The Group’s long-term growth strategy consists of six initiatives geared to increase customer value and advance solution leadership.

RetroFIT+

The RetroFIT+ initiative concentrates on increasing the renovation rate of existing buildings by resolving the most significant bottlenecks in the overall upgrading process through training, tools, and products. Belimo has expanded its sales organization with dedicated product managers and RetroFIT+ Application Specialists who are supporting the various customer personas from the initial project assessment to successful completion.

Grow Asia Pacific

In 2022, Belimo increased its market presence in China by opening two additional sales offices in Chongqing and Suzhou, bringing the total number of hub offices to 13. In India, the main pillars of the strategy are the focus on specific vertical markets such as data centres, pharma, and healthcare by building up the sales network for advising consulting engineers and end users.

In addition, local presence with hub offices is expanding, especially in high-growth regions. Belimo also celebrated the opening of its new India headquarters in 2022 to strengthen its footprint and brand awareness on the subcontinent.

Actuators and Valves

The largest sales contribution originates from the damper actuators and control valves business, which accounted for 96% of total net sales in 2022. Over the next few years, Belimo intends to make extraordinary investments in the fundamental renewal of the core platforms for both damper actuators and control valves, while at the same time fully integrating its sensors and meters product range.

In 2022, Belimo completed the rollout of the smallest HVAC damper actuator in the market (UM/UH), with sales developing as anticipated. For the range of UL-rated fire and smoke damper actuators, the newly introduced FSKN BACnet life safety remote inspection module seamlessly connects to fire alarm panels or the building automation system – thus, allowing for remote testing of actuated life safety dampers without costly visual inspections. In the control valves business line, Belimo Energy Valves experienced high sales growth once again.

Sensors and Meters

Sensors and meters, which accounted for 3% of total net sales, gained further traction in 2022 with a growth of 38.5% in local currencies. A new product line of room sensors and operating units was launched in late summer, gas detection sensors were introduced into the US market and thermal energy meters with Measuring Instruments Directive (MID) approval were made available worldwide.

Digital Ecosystem

A key activity in the reporting period has been the consistent expansion and consolidation of the Belimo Digital Ecosystem, to ensure that more and more devices in the Company’s portfolio can communicate with building management systems on a global basis. As part of the Digital Ecosystem initiative, a digital twin is created for each Belimo IoT device, collecting all the digital information the device needs to operate. Customers who own a Belimo IoT device thus also own its digital twin and can interact with it through an open and fully documented interface: the Belimo Cloud API.

Third-party applications can then elaborate and aggregate the data collected by their devices, which is subsequently transformed into information. Belimo has 24 Digital Ecosystem Collaborators to date. Startup partners include Kode Labs, Facilio, Passive Logic, Brainbox AI and Sally R.

Belimo is well-positioned to maintain its global market share in control valves and damper actuators through its investment in core platforms, innovation and digital ecosystems.

This article was written by Daphne Tomlinson, Senior Research Associate at Memoori.