Increase in value

NORMA Group’s main strategic objective is achieving sustainable profitable growth for the company. Building on its many years of successful corporate development, the Company continues to strive for profitability above the industry average and an efficient use of the Group’s capital. On its way to achieving these goals, NORMA Group pursues a stakeholder-oriented approach. This is based on the expectations of customers with regard to innovative, reliable and value-creating solutions as well as on the financial interests of shareholders, the needs of the workforce and the concerns of suppliers. A motivated, competent and loyal workforce is a fundamental prerequisite for meeting the diverse requirements of external stakeholders. To this end, NORMA Group strives to offer its employees an environment geared towards continuous growth, thus underpinning its position as an attractive employer. At the same time, NORMA Group considers it an integral part of its corporate responsibility to reconcile the effects of its business activities with the expectations and needs of society. Accordingly, the principles of responsible corporate governance and sustainable action apply to all business decisions. Therefore, the Management Board regards Corporate Responsibility (CR) – NORMA Group’s responsibility vis-à-vis people and the environment – as an integral part of the Company’s strategy. Further information on this can be found in the CR REPORT as part of the Group’s CORPORATE RESPONSIBILITY STRATEGY.

NORMA Group’s strategy for long-term value enhancement is based on the following key objectives and strategic measures:


Profitable growth

NORMA Group’s primary goal is to achieve a sustained increase in the Company’s value. Therefore, the focus is on the continuous profitable expansion of business activities. By continuously expanding application solutions for existing customers and identifying and acquiring new customers, business activities are being steadily expanded, thus increasingly strengthening its international presence. Making selective additions to its product portfolio, expanding its regional presence and market position in the strategic end markets of Water Management, Industry Applications, and Mobility & New Energy are at the core of NORMA Group’s growth strategy. In identifying its business areas, NORMA Group focuses on markets with attractive margins, sophisticated products, strongly growing sales potential and a fragmented competitive structure. Global megatrends such as climate change are increasing the need for low-emission technologies. The growing scarcity of resources and the increased occurrence of extreme weather events constitute attractive growth potential for NORMA Group, especially in terms of its global water business.

Selective product portfolio

The technological requirements for NORMA Group’s end products are constantly changing. Increasing environmental awareness, scarcity of resources and growing cost pressure – further intensified by the huge rise in energy costs – play a major role in nearly every sector of industry. Furthermore, there are binding legislative requirements that are becoming more stringent, particularly in the automotive and commercial vehicle industries, due to stricter emission regulations or special requirements for the materials used. This is also accompanied by increasing technological change, away from conventional combustion engines towards alternative drive technologies such as hybrid, electric and hydrogen drives. LEGAL AND REGULATORY INFLUENCING ASPECTS These framework conditions form the starting point for the development of new products. NORMA Group focuses on value-enhancing solutions that help its customers to reduce emissions, leakage, weight, space and assembly time. One main focus here is also on the area of thermal management for vehicles. RESEARCH AND DEVELOPMENT With its Water Management strategic business unit and its extensive product portfolio for applications in landscape irrigation,

storm water management and infrastructure solutions in the water sector, NORMA Group helps its customers to optimize their use of scarce resources. Innovations play an important role in meeting the increasing customer demands that accompany each new production cycle. NORMA Group therefore has more than 300 employees working in research and development, where engineers and developers work on developing new products and optimizing processes and systems that are currently in use. In order to sustainably strengthen its innovative capability, the Group plans to spend around 3% of its sales on research and development activities each year.  RESEARCH AND DEVELOPMENT


Selective acquisitions to supplement organic growth

By making targeted acquisitions, NORMA Group contributes to strengthening its growth and expanding its business. Acquisitions are therefore an important part of its long-term growth strategy. NORMA Group continuously monitors developments in the strategic business units Water Management, Industry Applications and Mobility & New Energy and contributes to their consolidation with targeted acquisitions. Since its IPO in 2011, the Group has acquired a total of 14 companies and integrated them into the Group. The main focus of M&A activities is on companies that contribute to realizing NORMA Group’s strategic goals, strengthening its competitive position and/or generate synergies. Continued growth and high profitability also play an important role here. Since acquiring the US company National Diversified Sales (NDS) in fiscal year 2014, NORMA Group has built up an established market position in the fast-growing water industry, which is to be expanded through further acquisitions in this area. One example of this is the agreement signed in December 2023 to acquire the Italian supplier of irrigation products Teco.


Strategic and regional growth initiatives

In order to achieve the goals anchored in its strategy, NORMA Group is driving specific initiatives in the various regions and strategic business units. They include, in particular, the concerted expansion of the water business in all regions. The activities that are already underway in the area of Water Management in the Americas are to be strengthened by further expanding the online and e-commerce channels. To expand the water business in the EMEA and Asia-Pacific regions, the current structures will be used to advance business development organically or complete value-enhancing acquisitions. Further details can be found in the section on “Step Up”. GROWTH AND EFFICIENCY PROGRAM “STEP UP” In addition to the regional expansion of activities, the focus of business activities is also on entering new areas of application. This relates in particular to the examples in the section RESEARCH AND DEVELOPMENT.

In the area of Industry Applications, the focus is on active portfolio management and a targeted brand strategy. E-commerce initiatives are also to be enhanced in this business unit, especially relating to the region EMEA. By localizing production even further, selectively expanding the product range and focusing on fast-growing markets, the business unit Industry Applications in Asia-Pacific is to be further expanded and at the same time made to be even more profitable.

NORMA Group also intends to further expand the activities of the business unit Mobility & New Energy globally. Here, the Company will focus on strategic and profitable applications that meet the current and future requirements of its customers. At the same time, NORMA will seek to achieve and defend a leading market position in all regions by constantly improving its cost structures.


Growth and efficiency program “Step Up”

In mid-2023, NORMA Group introduced a continuous improvement program to make its operating business even more efficient and productive, therefore enabling further profitable growth. The approach was developed in spring 2023 together with NORMA Group’s management team. The program is divided into two core elements: operational efficiency and growth. In particular, “Step Up” includes measures to increase operational efficiency as well as growth plans for the three strategically important areas of Water Management, Industry Applications and Mobility & New Energy. In particular, resources – such as in research and development – should be used with the aim of achieving the best possible economic effect. The implementation of the individual measures contained therein is continuously monitored. All activities will focus even more strongly on the needs of customers.

The measures in the area of Operational Efficiency are aimed at further improving internal and external business processes and gearing them towards sustainable profitable growth. Among other things, the focus here is on improving processes. To this end, the IT systems are being further optimized and globally standardized, and complexities are being systematically reduced. NORMA Group wants to further improve its delivery capability while keeping inventories low and further shortening response times. The internal reporting system will also be precisely aligned with the objectives of the program.

NORMA Group was already able to achieve noticeable improvements in operating efficiency in fiscal year 2023. For example, supply chain management in the EMEA region was leveraged efficiently. The availability of products also improved significantly. This positive development puts NORMA Group in a position to better support the sales of its products in the future. The issue of optimizing production processes is also essential given the objective of using resources in the production process to extract a high economic gain. The focus here is particularly on the automation of processes. In fiscal year 2023, work was carried out to identify further potential for improvement. Based on this, a roadmap for automation processes was defined. Important production processes were also automated in the past fiscal year.

Growth plans for the three strategic business units are pooled under the Growth mantle. In doing so, the alignment in strategic business units is to be consistently implemented in the corporate organization and the business units are to be given more autonomy. This is to promote customer centricity while growth and investment decisions are to be made increasingly in the units. This allows opportunities to be seized more quickly and in a more targeted manner and customer requirements to be taken into account more specifically. In concrete terms, the plan is to generate stronger growth in the areas of Water Management and Industry Applications by gaining stable business. In the Mobility & New Energy segment, NORMA Group focuses on seizing sales opportunities in the area of alternative drive systems, such as battery-electric or hydrogen-powered vehicles, as well as customer requirements for stricter emission regulations through innovative products.

NORMA Group also made significant strides in the area of growth in the past fiscal year in the three strategic business units Water Management, Industry Applications and Mobility & New Energy. This included primarily launching new products while existing products were expanded to additional countries or customer groups.

In the Water Management segment, the Company succeeded in taking an important step into the European water business with the acquisition of Teco Srl. NORMA Group intends to build on this success and push ahead with the further expansion of its activities in the EMEA region. To this end, an executive with in-depth expertise in the field of water management was placed in Europe in fiscal year 2023. By opening a new production site in Lithia Springs in the USA, further significant production capacities were created in the water business, which is strategically important for NORMA Group. Thanks to this step, the Group will further improve its product range in the US market and better reach and develop the East Coast geographically. The expansion of the Raindrip product series in the end customer segment in North America and in the Asia-Pacific region, particularly in Australia, was also stepped up.

In the current reporting year, the Group also worked on identifying new sales potential. This also means that NORMA Group’s teams in the strategic business units also focus on alternative applications for products already established on the market in order to open up new product application areas. In the field of water management, for example, valve boxes are offered for use in maintenance boxes for telecommunications networks. This created a synergy for an application relating to a product that is primarily in demand in the neighboring strategic business unit Industrial Applications.

In the Industry Applications strategic business unit, NORMA Group developed new business applications in the past fiscal year 2023. With the aim of creating synergies, existing core competencies from the Mobility & New Energy division’s connection technology were applied to entirely new product areas. One example is the successful transfer of NORMA Group expertise to heat pump applications. A significant order from a leading German manufacturer underlines the need for innovative solutions for use in renewable energies. New sales opportunities were also identified. Aviation is a good example of this. The Company also identified further sales opportunities in the 2023 fiscal year in connection with a stronger footprint in the European DIY sector. NORMA Group is continuously working to expand its sales opportunities by stepping up its customer relations and support.

Significant progress was also made in the Mobility & New Energy segment, NORMA Group’s third strategic business unit, in the past fiscal year. This progress was mainly achieved the field of innovation and further development. In particular, product improvements with a focus on efficiency and standardization were implemented in 2023 RESEARCH AND DEVELOPMENT. Work was also carried out on the development of a new connector standard that significantly reduces flow losses. This is in line with NORMA Group’s commitment to always offer highly developed joining technologies tailored to the individual needs of the customer and in doing so gain new customers. New Asian customers were successfully gained in fiscal year 2023. The continuous expansion of the footprint in electromobility is also a key success factor for NORMA Group.


These contents are part of the Non-financial Group Report and were subject to a separate limited assurance examination.