Annual Report 2011 |
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Dear Shareholders and Business Associates, Interroll performed well during the 2011 financial year and was able to enhance its market position worldwide. In terms of local currency, sales revenue rose by 7.5 % compared with 2010. The adverse impact of foreign currency translation, particularly with regard to the US dollar and the euro, resulted in sales revenue of CHF 271.9 million (2010: CHF 283.1 million) expressed in the currency of consolidation. Net profit was up significantly by 26.1 % year on year from CHF 14.4 million to CHF 18.2 million. Benefiting from major investment over the past five years, Interroll gained additional market share worldwide in the period under review. All product groups contributed to this favourable development. Individual products recorded significant gains in market share, including the next-generation 24 V motorised rollers. New corporate structure established successfully The new corporate structure introduced at the start of 2011 proved to be highly successful early on in the year under review. As a result of restructuring, we were able to increase market penetration and provide our customers with an extended range of efficient key products in the field of internal logistics. The new structure makes Interroll more accessible and systematically aligns all sales activities towards the requirements of different customer groups: system integrators, equipment manufacturers and users. Interroll also intends to leverage the new structure in order to unlock potential for future growth and take advantage of the structural changes witnessed within the market. The new structure makes the internal organisation more transparent, standardises processes of innovation and pools production technologies. This ensures that the product range is available globally at a consistently high quality. Interroll Centres of Excellence in Europe, the United States and Asia, together with installation and service operations in various countries worldwide, enhance the benefits to customers by cutting delivery times, as well as through applications engineering and servicing. Growing brand awareness Our customers' client base is recognising the benefits of Interroll products to an increasing extent. These clients include multinational corporations like Red Bull, Procter & Gamble, Amazon, Coca-Cola, UPS and Frito Lay. Positive experience of working with Interroll on a project in 2009 prompted Red Bull in Thailand to order dynamic storage solutions from Interroll again in 2011 for a new distribution centre. In Germany, Interroll won a major contract for dynamic storage technology in the year under review for use in a distribution hub for Procter & Gamble. The Chinese postal service opted for the Interroll crossbelt sorter due to its high level of energy efficiency and minimal maintenance requirements. In addition to distribution centres and providers of postal, courier and express delivery services, Interroll products are primarily deployed in growth markets such as the food industry, airport logistics and various industrial sectors. Customers benefit from easy-to-integrate, plug-and-play products for all primary interfaces within the area of internal logistics. These energy-efficient solutions are provided under the single Interroll umbrella brand. As various awards in the year under review demonstrate, Interroll is increasingly regarded as an innovation partner when it comes to materials handling solutions. Interroll was presented with the iF Product Design Award 2011 for its new control modules that are designed to enhance the energy efficiency of container conveyor systems. In May 2011, the new RollerDrive motorised rollers were awarded an MM Logistik Award by Vogel Business Media at CeMAT in Hanover (Germany), the world's no. 1 trade show for internal logistics. In late 2011, the German Agricultural Society (DLG) announced that the Interroll Synchronous Drum Motor was a winner of the International FoodTec Award 2012 in Gold. In conjunction with Leibniz Universität Hannover (Germany) and Southeast University Nanjing (China), Interroll - as competence partner - launched a scientific study in the year under review into the sustainable building and operation of distribution centres. The aim of the study is to create a simulation tool that calculates benchmark data for distribution centres. The program is designed to identify possible long-term improvements for new-build and upgrade projects and support investment decisions in a professional, practical way. By simulating projects, Interroll aims to offer its customers and operators of distribution centres worldwide real added value. The program is scheduled for completion in the current financial year. The project also serves to raise market awareness of Interroll dynamic storage technology and its benefits with regard to handling fast-moving merchandise, and to promote sales. Strategic projects implemented Alongside innovation, Interroll pressed ahead with its planned strategic projects and activities in the year under review, which as well as the organisational realignment included further expansion of the global network and the introduction of SAP. The latter proved to be a demanding project, with Interroll now having attained the first intermediate target when the system successfully went live at 13 companies in 10 European countries. Preparations for the next stage of the SAP rollout were speedily initiated. This major project is highly resource-intensive and requires a high level of commitment from employees worldwide. The follow-on project is meticulously utilising findings from the first phase of implementation to enable the tool - which is very important to the company's future - to be rolled out effectively across the entire Group. In the period under review, Interroll continued to apply Kaizen methodology at its centres of excellence for products. The principle of continual improvement has been introduced at the regional Centre of Excellence for Asia and at the Centre of Excellence for Subsystems and Conveyor Modules in Sinsheim (Germany), where Crossbelt Sorters, Belt Curves, Roller and Belt Conveyor Modules are produced. The Kaizen concept forms part of ongoing efforts to boost productivity and lower costs. A stronger geographic network In September 2011, Interroll officially opened the new regional Centre of Excellence for Asia/Pacific in China. The new facility in Suzhou (west of Shanghai) has four times more production space than before to enhance Interroll's customer service offering in China, other Asian markets and Australia. With its own production and assembly facility covering the entire product range, as well as the expertise to provide applications engineering, the company is able to extend its customer services, streamline delivery periods and guarantee on-time delivery even with regard to large-scale projects. Employing more than 150 people, the company has a production area of 10,000 square metres across two factory buildings. Over 160 customers, partners, representatives of the authorities and associations, guests of honour and journalists from China, Japan, Korea and Thailand attended the opening ceremony. In order to improve market penetration in Australia, Interroll took over the business activities of a long-standing local partner at the beginning of 2011, consolidating two existing sites into one. In Turkey, Interroll established its own local sales office in the year under review. A branch of Interroll was also opened in Jakarta (Indonesia). Distribution of reserves from capital contributions In view of the financial stability of the company and the encouraging results achieved during the financial year now ended, the Board of Directors will propose to the Annual General Meeting of Shareholders on 11 May 2012 a distribution of CHF 7.00 per registered Interroll share (2011: CHF 5.00 per registered Interroll share) out of reserves from capital contributions. This distribution of reserves from capital contributions (in place of a dividend) is usually tax-exempt for shareholders. Thanks to our employees The Board of Directors and Group Management would like to thank all members of staff for their above-average commitment in the year under review. It is a testament to the efforts of each one of them that the new structure was rolled out successfully. In addition to performing their day-to-day duties, the European operations also had to take on the strategic SAP project. Every staff member contributed to the encouraging results. Outlook Despite a good start to the new year, with economic conditions remaining volatile Interroll is adopting a watchful approach to the immediate future. We do not expect the situation to fundamentally improve during the current financial year: foreign exchange fluctuations are likely to continue along with rising commodity prices in some areas and the prospect of political upheaval. Our newly reorganised corporate structure accords with our long-term growth strategy, helping further strengthen our market position and increase market share, as well as allowing us to leverage market opportunities more effectively. We will continue to expand our global network in a targeted manner and to forge ahead with our activities in the United States and Asia. Tight cost management, ongoing increases in productivity and a solid financial base are other priorities. We will proceed with strategic projects as planned. Other investment in innovative products offering real added value for customers is also envisaged and is aimed at securing the future of the business.
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