Rieter Business report FY2007
Business Highlights
Financial
overview
Result in Automotive Systems
(1)The growth trend of the past five years continued in the year under review. Sales increased by 8% to 2,363.3 million CHF. This growth was broad-based in terms of both geographical spread and models equipped. The Company grew significantly faster than vehicle putout in both its main markets, Western Europe and North America. It also achieved substantial growth in South America and Asia.
(2)The positive sales was not translated into a corresponding increase in earnings: the operating result before interest and taxes (EBIT) in the 2007 financial year amounted to 91.6 million CHF (94.7 million CHF in 2006). At 4.0% of corporate output (4.4% in 2006), the Company maintained the operating margin achieved in the first half of 2007. The subdued outcome was attributable to increasingly severe pressure exerted by customers on supplier's prices as well as the rising cost of materials and energy, only a small part of which could be passed on to customers. The Company was unable to compensate fully for these developments through cost-cutting programs in 2007. Additional costs arose in connection with production reallocations in England.
Globalization
Europe
-The Company accounts for a total of some 10% in the commercial vehicle business in Europe.
-The Company's extension in Eastern Europe is being added to the existing manufacturing facility in Chocen, Czech Republic. The plant inaugurated in Nowogard, Poland in 2007 has developed. Growth in these countries is the result of the relocation of the Company's operations from Western Europe.
-The new plant Somerset inaugurated by the Company and Nittoku in Kentucky, the U.S. to supply the Japanese automobile manufacturers developed.
Asia
-In 2007, the Company opened a wholly owned plant in Chongqing, China. The two facilities established in China together with its Japanese partner Nittoku in previous years have also developed.
-Together with the Company's Korean partner DKT, it started to built-up and expand the business for Korean customers.
-In the commercial vehicle sector, the Company received initial orders in India as well as China.
| (in CHF million) | FY2007 | FY2006 | Rate of change(%) |
Factors |
| Overall | ||||
| Sales | 3,930.1 | 3,501.4 | 12.2 | - |
| Operating income | 278.7 | 180.6 | 54.3 | - |
| Automotive | ||||
| Sales | 2,363.3 | 2,179.2 | 8.4 | (1) |
| Operating income | 91.6 | 94.7 | (3.3) | (2) |
Result in Automotive Systems
(1)The growth trend of the past five years continued in the year under review. Sales increased by 8% to 2,363.3 million CHF. This growth was broad-based in terms of both geographical spread and models equipped. The Company grew significantly faster than vehicle putout in both its main markets, Western Europe and North America. It also achieved substantial growth in South America and Asia.
(2)The positive sales was not translated into a corresponding increase in earnings: the operating result before interest and taxes (EBIT) in the 2007 financial year amounted to 91.6 million CHF (94.7 million CHF in 2006). At 4.0% of corporate output (4.4% in 2006), the Company maintained the operating margin achieved in the first half of 2007. The subdued outcome was attributable to increasingly severe pressure exerted by customers on supplier's prices as well as the rising cost of materials and energy, only a small part of which could be passed on to customers. The Company was unable to compensate fully for these developments through cost-cutting programs in 2007. Additional costs arose in connection with production reallocations in England.
Globalization
Europe
-The Company accounts for a total of some 10% in the commercial vehicle business in Europe.
-The Company's extension in Eastern Europe is being added to the existing manufacturing facility in Chocen, Czech Republic. The plant inaugurated in Nowogard, Poland in 2007 has developed. Growth in these countries is the result of the relocation of the Company's operations from Western Europe.
-The new plant Somerset inaugurated by the Company and Nittoku in Kentucky, the U.S. to supply the Japanese automobile manufacturers developed.
Asia
-In 2007, the Company opened a wholly owned plant in Chongqing, China. The two facilities established in China together with its Japanese partner Nittoku in previous years have also developed.
-Together with the Company's Korean partner DKT, it started to built-up and expand the business for Korean customers.
-In the commercial vehicle sector, the Company received initial orders in India as well as China.
R&D
R&D
Expenditure
R&D Structure
-The Company operates nine acoustics laboratories as well as a central research center in Winterthur for acoustic and thermal management as well as the respective products and materials.
Product development
-Rieter Ultra Silent (RUS) has stability, acoustic properties and market potential. One of the advantages of Rieter Ultra Silent is being recyclable. In contrast to existing products with similar properties, it contains no glass fibers. The material that is very light and heat-resistant satisfies requirements in automotive engineering and can be used in various parts of the vehicles, which has been developed by the Company's both divisions, Textile and Automotive Systems. The Company's Automotive systems received its first volume orders for products based on Rieter Ultra Silent.
|
(in CHF million) |
2007 | 2006 | 2005 |
| Total | 141.1 | 144.8 | 144.7 |
R&D Structure
-The Company operates nine acoustics laboratories as well as a central research center in Winterthur for acoustic and thermal management as well as the respective products and materials.
Product development
-Rieter Ultra Silent (RUS) has stability, acoustic properties and market potential. One of the advantages of Rieter Ultra Silent is being recyclable. In contrast to existing products with similar properties, it contains no glass fibers. The material that is very light and heat-resistant satisfies requirements in automotive engineering and can be used in various parts of the vehicles, which has been developed by the Company's both divisions, Textile and Automotive Systems. The Company's Automotive systems received its first volume orders for products based on Rieter Ultra Silent.
Investment Activities
Capital expenditure (CHF million)
Overseas Investments
-The plant inaugurated in Nowogard, Poland in 2007.
-The new plant Somerset inaugurated by the Company and Nittoku in Kentucky, the US to supply the Japanese automobile manufacturers developed.
-In 2007, the Company opened a wholly owned plant in Chongqing, China.
|
(in CHF million) |
2007 | 2006 | 2005 |
| Automotive Systems | 112.4 | 121.3 | 155.1 |
| Overall | 203.5 | 186.2 | 182.3 |
Overseas Investments
-The plant inaugurated in Nowogard, Poland in 2007.
-The new plant Somerset inaugurated by the Company and Nittoku in Kentucky, the US to supply the Japanese automobile manufacturers developed.
-In 2007, the Company opened a wholly owned plant in Chongqing, China.