Safety Components International Business Report FY2007

Business Highlights

Financial overview (in thousand dollars)
Net Sales FY2007 FY2006 Rate of change
Total 1,010,853 733,521 37.8%
Automotive Safety 449,250 228,197 96.9%


-In early 2007, the Company completed the acquisition of certain plant and airbag cushion assets from its Romanian subcontractor for airbag cushions for an aggregate purchase price of ?5.5 million (approximately $7.2 million). This facility provides 窶彡ut and sewツ・services to the Company窶冱 European automotive airbag business. The acquisition has allowed the Company to more fully integrate this business and lower its costs on products produced at the facility as well as allow for expansion of production at the facility, thereby generating an enhanced contribution to operating earnings.

-On April 1, 2007, the Company completed the acquisition of BST US Holdings, Inc. ("BST Holdings"). The Company acquired all of the outstanding shares of BST Holdings in exchange for the issuance of approximately $84.0 million of Series A Convertible Preferred Stock. As a result of the acquisition, BST Holdings became a wholly-owned subsidiary of the Company.
BST Holdings owns the BST Safety Textiles business ("BST"). BST, based in Maulburg, Germany, is a leading international manufacturer of flat and one piece woven fabrics for automotive airbags as well as narrow fabrics for seat belts and military and technical uses. In 2006, BST had net sales of approximately $270.0 million.
The Company is in the process of integrating BST with the Company's Safety Components business, and will operate BST as a part of the automotive safety business unit. Management believes the combined product, technical and market expertise of the BST and Safety Components businesses provides enhanced opportunities for accelerating the growth and expansion of the automotive safety business. The acquisition of BST is expected to provide considerable operating cash flow to ITG as well as opportunities for significant synergies upon the combination of the businesses.

-In March 2007, the Company committed to a plan to transfer the operations of the automotive safety segment's Bad Sackingen facility in Germany to other facilities in Poland and Murg, Germany. In connection with this plan, the Company reached termination agreements with approximately 25 employees. -In September 2007, the Company announced that it would close its Hildesheim, Germany facility in the automotive safety segment. The operations previously undertaken at this facility are being transitioned primarily to Poland and other countries in Eastern Europe where the Company believes it can operate more cost competitively.


R&D Expenditure
(in million dollars) FY2007 FY2006 FY2005 
Transit Period
Total 10.6 7.3 1.5 5.1

R&D Structure

-The Company has technical centers in Greenville, South Carolina; South Hill, VA; Ensenada, Mexico; and Hildesheim and Maulburg, Germany.

-All of the Company's laboratories are ISO/TS 16949 certified.

-Through its textile laboratory located in Greenville, South Carolina, USA, the Company has the ability to test and analyze a wide range of fabrics (airbag or other) under internationally accepted testing standards, including US-ASTM, Europe-DIN and ISO, Asian-JIS and Underwriters NFPA. All validation testing and analytical testing of fabric is performed at this laboratory. Additionally, the Greenville facility has prototype-manufacturing capabilities.

-The Ensenada, Mexico technical center consists of a testing laboratory and a dedicated prototype cell, complete with a separate staff and equipment.

-The center in Hildesheim, Germany has the ability to conduct static and dynamic deployment testing and analysis.

-The Company holds 35 patents and approval for 8 additional patents are pending.