International technology group Schott is optimistic regarding the future after a rather difficult 2008/2009 fiscal year ended 30 September 2009. Thanks to the solid results of the first five months of…
International technology group Schott is optimistic regarding the future after a rather difficult 2008/2009 fiscal year ended 30 September 2009. Thanks to the solid results of the first five months of the new fiscal year, the company expects the rest of the year to develop quite positively. We are beginning to leave the economic crisis behind us and will increase our sales by a double-digit percentage, said Professor Udo Ungeheuer, the Chairman of the Board of Management, during the annual results press briefing in Mainz on 19 March. Moreover, Schott also began manufacturing Fiolax special glass tubes for pharmaceutical packaging at its main site in Mainz in October 2009. Schott Group“s business units are currently reporting positive figures, with the Home Tech division among the units that are recording the highest growth. With Ceran Hightrans eco, Schott is the first manufacturer to offer a glass-ceramic cooktop panel that is manufactured without toxic heavy metals such as arsenic and antimony. High capacity utilization has also been ensured thanks to a major order for glazing for the Chinese state railway“s high-speed trains, along with increased demand for fireplace viewing panels. The electronic components business is also developing quite positively, especially with regards to home appliances, cell phones and the automotive industry, with Asia clearly the main growth region. The acquisition of Schott Elecpac, in the US in 2009 has also made a significant contribution to the further expansion of this business. As market and technology leader in the solar sector, Schott is an important partner in numerous power plant projects both in the Mediterranean area as well as in the US. Prof. Ungeheuer emphasized that the announcement regarding a dramatic reduction in the feed-in tariff to take place as of 1 July 2010, with regards to photovoltaics, has left the market feeling extremely insecure. Thanks to its high-quality modules that continue to deliver far more than 90% of their rated output, even after 25 years, Schott Solar is well-prepared to cope with the new situation, he added. Nevertheless, Schott will continue to appeal to politicians in the hope that they will show greater understanding for the situation of the German photovoltaic industry, particularly with respect to cheap competition from Asia. Schott“s pharmaceutical packaging business continues to show steady development, achieving increased sales in ampoules, vials, syringes and cartridges, also due to the acquisition of two pharmaceutical packaging companies in Argentina. Schott is also seeking to extend its leading position in the area of high-quality products in Russia and is preparing to set up manufacturing of ampoules and vials. According to Professor Ungeheuer, flat glasses for household appliances and glasses for optical applications still have plenty of room to grow, expressing his optimism that these sectors will be able to report considerable increases in sales by the end of this fiscal year in September 2010. To secure its position as one of the leading technology groups in the area of special glass products and other high-tech materials, Schott will also make considerable investments in fixed assets during this current fiscal year 2009/2010, with about EUR 150 million dedicated to Pharmaceutical Systems and Solar. The global financial and economic crisis also had a significant effect on Schott Group“s activities during the fiscal year 2008/2009, with heavy declines in orders from the automotive, electronics and semiconductor industries and high competitive pressure in the area of photovoltaics, which were partly counterbalanced by stable business in pharmaceutical packaging and receivers for solar thermal parabolic trough power plants. The company was able to partially cushion the effects of the crisis thanks to strategic efforts made at a very early stage, but also to the extremely strong dedication of its employees. Short-time work, cost reductions and the voluntary decisions made by employees not to accept bonuses were all important factors in limiting damages, Professor Ungeheuer emphasized. Nevertheless, the company still expanded during the 2008/2009 fiscal year, acquiring a leading manufacturer of components for electronic housings in the US and two pharmaceutical packaging companies in Argentina, as well as acquiring the remaining shares in photovoltaic company Wacker Schott Solar. New manufacturing facilities, including a production line for prefillable syringes and the opening of a new manufacturing plant for solar receivers and photovoltaic modules in the US, a new facility for fiber optic products located in Mexico, and a new production facility for pharmaceutical tubing in Mainz, were set up and put into operation. Schott Group“s sales increased by 3% to EUR 2.261 billion in the past fiscal year, compared to EUR 2.200 billion in the 2007/2008 period. This increase is mainly due to the inclusion of the Tokyo-based Moritex Corp. in the consolidated financial statements for the first time, along with increased sales of solar products. Europe, with a 58% share in sales, is Schott“s most important region, followed by Asia (19%) and North America (18%). Results from operating activities (EBIT) amounted to a loss of EUR 22 million due to significant declines in orders from important groups of customers and non-recurring restructuring expenses, while EUR 216 million were invested in fixed assets, most of which contribute in the setting up solar manufacturing in the US and Germany. Employee numbers remained stable at 17,400.