I'm terribly forgetful.

Literal

Forgetfulness [subject-が] terrible [explanatory-んです].

物忘れ is a compound noun: 物 (things) + 忘れ (forgetting) = 'forgetfulness.' ひどい means 'terrible/severe.' んです (contraction of のです) adds an explanatory tone, as if confessing or explaining a problem to someone, perhaps a doctor.