Looking back: 2023 successes and setbacks

Shall we start with the good news? Are the transformation efforts that you initiated paying off?

An Steegen: “2023 was, in fact, a very good year for some of our business units. Our entertainment business, especially cinema, flourished and that’s impressive, taking into account the weaker Chinese market. We also won significant market share in meeting rooms.”

Charles Beauduin: “The transformation that we kicked off to become a truly focused and lean organization is still underway. We kept simplifying our organization in 2023, consolidating even more functions in the business units to boost efficiency and accountability. The decision to re-acquire 100% of the shares in Cinionic fits that strategy too. In 2023, we truly started benefiting from our reorganization.”

Furthermore, we have continued to progress on our focused factories strategy. The new healthcare factory in Suzhou is up and running, and the construction of the projection factory in Wuxi is close to completion, without delays. And there is more to come in our European plants as well: we plan to relocate the factory in Saronno, Italy, to a greenfield location nearby, and to ramp up investments for production and logistics in Belgium.

Still, achieving the growth that you had envisioned for 2023 was more difficult than expected?

An: “There’s no denying that. At the end of 2022, we saw clear tokens of market confidence. In the first quarter of 2023, sales indeed went up significantly, but then growth halted, mainly as the Chinese economy did not follow the expected recovery path after the pandemic. On top of that, to address supply chain shortages, customers had stored more stock in 2022 than we’d anticipated.”

So, does Barco’s resolute China strategy still hold strong?

Charles: “We were indeed wrong about the timing of China’s economic recovery. Its weak rebound came as a surprise, not only to us but also to the global financial markets. Even the Chinese government had overlooked the severe impact of the 3-year covid restrictions. The debt and faltering real estate greatly affected investments, not in the least in our markets, for example, in shopping centers, cinemas, events, theme parks and even hospitals. Yet, we still believe in the strengths and potential of this vast economy.”

In 2022, An said that accelerating innovation is Barco’s biggest growth opportunity. Have you taken strides forward in that field?

An: “A clear focus on innovation is the only way for a tech company like Barco to differentiate itself, so we’re working hard to instill more innovation capabilities. And we did manage to strengthen these, in the past year. The first results were launched in 2023 and there’s a pool of new product introductions for 2024 and beyond. Moreover, I also see a clear transition towards adding more software to our stack. ClickShare is a great example. Our Large Video Walls team is fully shifting their focus to software. And software becomes increasingly important in every other division too.”

Buckling up for 2024

So, 2024 promises a large portfolio of new products and solutions?

An: “Absolutely. We plan to keep our R&D spending at about 12% of sales, and we’ll be introducing new solutions throughout the year. That includes both renewals of established products and revolutionary new solutions, including products to win adjacent markets. By the time this report gets published, we’ll have revealed some of this excitement already. The revolutionary HDR Lightsteering technology for cinemas is a great example of the landmark innovations we have in store. We’ve showcased it to professionals on several occasions in 2023 and directors and studios are really amazed.”

As for geographies, China remains a target market?

Charles: “Like I said, we’ll stick to our China strategy. China is still a big economy that is leading the way in many tech fields, like robotics. They have great engineers and there is a true entrepreneurial spirit. I’m proud that Barco is active there with a very local strategy, not just with manufacturing facilities, but equally with sales and R&D.

Still, more than China, we want to increase our focus on the wider Asian market, which is a clear growth area. Asian cultures love imaging, even more than the Western world. As a visualization champion, our market potential is huge there. Meanwhile, the Americas and EMEA remain our largest playing fields, where we have a long track record and leading positions in many of the end markets we serve.”

The bigger picture

What do you consider to be Barco’s biggest opportunities going forward?

Charles: ‘Meeting the need for ever-better quality solutions. The bar is continually raised in every aspect. Just look at a movie from 2013. After only 10 years, the image quality feels pretty poor, right? More than constantly improving the brightness, contrast and colors, quality is also increasingly about infusing intelligence in our solutions. And it covers sustainability too.”

An: “The changing paradigms of visualization will lead to an exciting future. Screens used to be static and one-directional, but today you start seeing bi-directional interactivity with screens reacting on your touch or eye movements. In the long run we can expect truly ubiquitous visualization: it will become a symbiotic lifelike experience, where visuals merge seamlessly with the real world. Software will take an ever-increasing role: AI is one of the key trends that inspires our innovation roadmap, as is ‘big data’. The world needs smart visualization solutions to extract meaningful insights from the abundance of available data.”

Charles briefly touched another main trend: sustainability. As the world braces itself for the ESG challenge, is Barco well prepared to meet ever-more stringent regulations?

An: “We’ve been a market frontrunner, calculating our carbon footprint and the footprint of our products for years. In 2016, we set 2023 as a target year for several emission reduction ambitions and I’m happy to see that we achieved, and even exceeded, all of these. Both our operations and our products are ever more energy-efficient and we pay attention to product packaging, circularity, and modularity too. With the ClickShare CX-50 2^nd generation, we even launched one of the first carbon-neutral wireless conferencing solutions in 2023. We have a great team that works hard to make sure that we continually push the envelope. The double materiality exercise that we are finishing will help take our sustainability efforts to the next level.”

In conclusion, how does the future for Barco look like?

Charles: “We keep moving forward on the path that we’re paving. Barco is developing value over the long term. We’re convinced that we’re doing that well: we have the team and the technology and our visualization business provides solutions to meet many different needs, from hybrid meeting rooms and entertainment to ever-smarter healthcare.”

Continued support

On a sidenote, Charles refers to the health issues that kept him away from the office for several months in 2023: “If there’s one thing that I’m particularly proud of when looking back at the past year, it’s that Barco stayed on track in the execution of our strategy, in spite of my absence. I’m incredibly thankful for all the support received both then and now that I’m back in business.”

“That counts for everyone at Barco. Many thanks to the Barco team, partners, investors, and of course our customers, who all help us visioneer a bright tomorrow.”