increase in revenue

Celebration of

‘100 years of


with employees and


Signifi cant focus on

fl exibility

Facts & fi gures

Industrial Magnetic Systems

Industrial Drive Systems

Passenger Car Systems

Commercial Vehicle Systems

Kendrion N.V.


in revenue reported by

all business units

Selection of IFS as

ERP software provider


Start of

greenfi eld

operation in India

Revenue Germany

EUR 148 million


Rest of Europe

EUR 65 million



Revenue Americas

EUR 20 million

Very good

normalised net profi t

EUR 20.5


Acquisition of




in December 2011

Very satisfying

free cashfl ow

of almost

EUR 15 million

Revenue Asia

EUR 32 million


fi nancial position


unit Passenger

Car Systems







Rest of the world

EUR 3 million

Signifi cant

focus on


including the Dr. Wilhelm

Binder Symposium in

November 2011


unit Industrial

Drive Systems





est of the world

Revenue growth


Revenue growth


Revenue growth


Revenue growth



± 2,000 customers

Production facilities in Germany, Romania, the USA and China

Additionally, sales organisations in the UK, Austria, Switzerland and Italy

Developed the world’s fastest acting solenoid


± 100 customers

Production and sales in Germany

Additionally, sales offi ce in the UK and China

Development of Kendrion Optimised Brake (KOBRA)


± 20 customers worldwide

Production facilities in Germany, Austria, the Czech Republic, Romania, the USA and China

Specialist leading on electromagnetic valves

Focusing on high-end products

Working on fuel systems and fuel effi ciency

Production capacity was expanded


Customers include major OEMs in global bus and truck market and all fi rst line suppliers

of air-conditioning systems

Production and sales in Germany, the USA, Mexico, Brazil, China and India

Objective is to evolve into global player and set standards quality and speed in R&D

>> 1

100 years of electromagnetism

Kendrion is like a ball that’s

been rolling since 1911,

spinning off other balls

brain ball product ball

>> 2 annual magazine 2011

that roll off on their own,

sometimes merging with still

more balls, almost by osmosis.

annual magazine 2011

land ball the 2011 celebrations of ‘100 years of electromagnetism’

at kendrion were opened with the unveiling of

‘the spirit of binder’ by jeremy lynch. since then the

artwork is exhibited at the villingen plant (germany).

jeremy lynch (1966, london) studied photography in

london and canada and now lives and works in berlin.

>> 3

Commercial Vehicle


Individual energy-saving

systems for commercial

vehicles and off-highway


>> Organisation

Passenger Car Systems

Project solutions for specifi c customer

applications in the automotive

and special vehicle industries

The Executive Board would like to thank

the following people for their contribution

to this Annual Magazine Robert de Bakker,

Armin Beck, Michael Bernhard, Martina Bodenlos,

William Brown, Sameer Deshmukh, Heinz Freitag,

Manfred Gebhart, Alexander Glaser, Norman Graf,

Bernd Gundelsweiler, Jürgen Häberle, Ralf Heingl,

Sandra Hoer, Heinz Jankowski, Eberhard Kallenbach,

Horst Kayser, Jan van Kesteren, Miriam Kreutter,

Laurent Lebas, Karl Mascher, Waldemar Pförtsch,

Brad Price, Gerald Puchner, Markus Rekla,

Waldemar Schaermann, Maja Sanders,

Werner Schneider, Jörg Wallaschek, Ralf Wieland,

Burkard Wördenweber and Frank Zelano

Copy Wim Dieleman, teamtva! reclamebureau

Photography and images Jens Hagen Büro

für Fotodesign, Atelier Lutz Hugel, Siemens and

Marloes Withagen

Organisation Wijgert Gooijer and Wilma Stuiver

Concept and realisation C&F Report Amsterdam B.V.,

Meander Media

>> 4

Profi le

kendrion n.v., a solution provider, develops, manufactures and markets

innovative high-quality electromagnetic systems and components for customers all

over the world. Kendrion’s operations are carried out by four business units focused

on specifi c market segments, namely Industrial Magnetic Systems, Industrial Drive

Systems, Passenger Car Systems and Commercial Vehicle Systems.

kendrion has leading positions in a number of business-to-business niche markets.

Germany is Kendrion’s main market, although other countries are becoming

increasingly important.

Kendrion’s activities

Industrial Magnetic Systems

Electromagnetic components tailored to

the individual needs of advanced industries

Industrial Drive


Electromagnetic brakes and

clutches for the industrial

drive technology

kendrion develops advanced electromagnetic solutions for industrial applications.

These are used by customers all over the world in systems such as lifts, door-locking

systems, industrial robots, medical equipment, electrical switchbox systems, diesel

engines, air-conditioning installations, motor cooling systems and beverage dispensers.

Kendrion’s key customers include Bosch, Siemens, Daimler, Continental, Delphi,

Evobus, Hyundai and Yutong.

Kendrion’s shares are listed on NYSE Euronext’s Amsterdam market.

annual magazine 2011


06 12

16 22

It all started in 1911 when the company’s founder,

Wilhelm Binder, barely twenty years old, had a vision:

to create his own company, Binder und Mook Werkzeuge GmbH

in Villingen, Germany. In 1938, his son, Dr. Wilhelm Binder Jr,

joined the company and in 1953, after his father’s death,

he took over management of the company. Dr. Wilhelm Binder

has had no problems fi lling his father’s shoes. The company has

thrived under his leadership, expanding its operations and

initiating new research and development, and acquiring more

than 40 patents. In 2011, under the banner ‘100 years of electromagnetism’,

Kendrion celebrated its origin.

A portrait of Dr. Wilhelm Binder features on the cover of

this Annual Magazine.

This publication includes a summary of the offi cial 2011 Annual Report.

The offi cial 2011 Annual Report of Kendrion N.V. dated 28 February 2012,

on which KPMG Accountants N.V. issued an unqualifi ed independent

auditor’s report, is available on the corporate website (www.kendrion.com)

along with other publications such as press releases.

Kendrion N.V.

Euronext code 0000383511

Security code 38351

ISIN code 0000383511

Chamber of Commerce 30113646

annual magazine 2011


01 Facts & fi gures

02 100 years of electromagnetism

04 Organisation

06 Kendrion’s core

10 2011 Landmark events

12 Co-creation

14 Cutting edge

16 Going global

20 Picture riddle

21 Column

22 Tomorrow’s Wilhelm Binders

26 Novelty

28 Back to the future

30 Social and responsible

32 Let’s get personal

34 The Kendrion Executive Programme

36 Bottomline Financial performance

>> 5

‘In 2011, we saw a strong return on our investments in new product development,

tapped into new markets and expanded our R&D capabilities building on previous

investments there. All these things started off in 2010 and kept rolling straight into

2011. Many projects we launched in 2011 really got off to a fl ying start, especially our

diesel market products. We invested in people, market intelligence, assembly and test

lines, and in the targeted branding of our company. All these things helped to put us

in exactly the right place at exactly the right moment. In this ongoing process we are

extending our niche market position even more towards the USA and China. At the

same time we continue to invest in next steps to anticipate future developments and

operate successfully. Technological innovations defi nitely remain at the core of our

business, with energy saving as an important issue. And with our American and Chinese

markets in mind, we are also putting a strong focus on gasoline engine developments.’

>> 6

Kendrion’s core


on technology

heinz freitag

chief technology officer

Moving up in the leagues

piet veenema

chief executive officer

‘Our strategy and its undivided focus on

fl exibility, globalisation and market

segmentation have begun to pay off. We aim

to become a global player, which will further

reduce our vulnerability and enable us to

offer the local markets what they require.

It is working so well we saw strong growth

in turnover in all parts in the world, but

especially in Asia. Growth in the Americas and

in Europe was extremely satisfactory, with the

result that, even with growth in Germany of

more than 10%, its market share in our total

annual magazine 2011

turnover declined. Our acquisition of

FAS Controls, Inc. in Shelby, North Carolina,

USA, in the fi nal stages of 2011, fi ts in very

well with this picture. This was an immediate

success, contributing to our profi tability right

away and helping to strengthen our position

in the US automotive and truck market.

2012 will undoubtedly bring new challenges,

but as we move up to the next league we will

stick to the effective growth strategy we have


annual magazine 2011

eiko ris

chief financial officer Preparing

for further growth

‘Searching for strategic growth was an important objective in 2011 and will

continue to be in 2012. We have managed to create an even distribution of

opportunities for all our business units, which is preferable from a span of

control point of view. In order to fully reap the benefi ts of acquisitions, we

are taking clear steps to strengthen our internal organisation. Very early

on, we knew how important it was to prepare Kendrion for further growth.

ICT and HR are critical in this. Do we have the right people with the right

competencies, expertise and experience in the right places, and can these

people deploy the right resources where they are needed? Our ERP project

HORIZON is a major investment in this, as is our ongoing recruitment and

development of staff. At the same time we are intensifying our efforts in

technological developments and globalising our engineering power.’

>> 7

>> 8

Kendrion’s core (continued)

Maximum effort

for maximum result

Innovation is our

driving force

Over the past few years the four members of

Kendrion’s Supervisory Board have worked

closely with the Board in developing the

company’s strategy. Now, they look back on

their work with satisfaction and watch Kendrion

reaping the fruits of their toil.

‘Of course, Kendrion has the economic recovery in its markets to thank for the company’s

excellent performance in 2011. But to seize the opportunities that come its way, a company

needs to have its priorities straight and know what it’s going for. By concentrating on

fl exibility and cost reductions during and after the 2008 crisis, we were in a perfect position

to take off when things turned around. Apart from this, our focus on innovation has

defi nitely helped put us where we needed to be,’ says Jan van Kesteren, Chairman of

the Supervisory Board.

>> Innovation incubator

In the past years, Kendrion has taken major steps forward in the fi eld of technology and

innovation. The company put together an Innovation Board, hosted a technology event for

its customers and developed a range of innovative products, such as the solutions for

common rail diesel systems. Supervisory Board member Horst Kayser explains: ‘Innovation

has become a priority and is now really driving the company’s development. Coming out of

a crisis is one thing, but keeping this up and achieving stable growth is the result of an

effective, driven innovation strategy.’

annual magazine 2011

The banks were sold on our

strategy and performance,

so will be our long-term


The Kendrion Supervisory Board

from left to right:

R.L. de Bakker (Vice-Chairman)

M.E.P. Sanders (member)

S.J. van Kesteren (Chairman)

H.J. Kayser (member)

annual magazine 2011

>> Money spent well

‘A requirement for autonomous development and growth through acquisitions is a sound

fi nancial position. The existing facilities enabled Kendrion to acquire FAS Controls in

the USA at the end of 2011. This move was fully in line with the company’s goal of becoming

a global player, but Kendrion’s ambitions go further,’ says Supervisory Board member

Robert de Bakker. ‘The banks looked at our successful development and were sold on

our strategy and operational performance. We recently reached an agreement with the

bank consortium for an extension of our fi nancial options under acceptable conditions.

This will put us in a position to expand further with more acquisitions. And the banks are

not the only ones with an eye to Kendrion’s strategic success. Over 2011, Kendrion was

the best performing share on the Small Cap Index (AScX) of the NYSE Euronext Amsterdam

exchange, with an overall return of approximately 20%. With numbers like this, Kendrion

can be sure it is keeping its loyal long-term shareholders happy.’

>> Happy people – happy products

‘But in the end it’s all about people,’ says Supervisory Board member Maja Sanders.

‘Our success, and our goals for taking it to the next level, also put pressure on our people.

Our customers demand quality at all levels, knowledge transfer is vital, and where the

economy is headed remains a great unknown. At the same time we want Kendrion to

be a safe haven for our employees, a company that helps them to grow and develop

and a community that facilitates connections and creates mutual understanding.

That’s the balance we are constantly looking for.’

>> 9

>> 10

2011 Landmark events

With concerted effort

Within Kendrion Industrial Magnetic

Systems, Business Unit Manager

Norman Graf considers last year’s

biggest accomplishment the

restructuring, reorganisation and

modernisation of the production

areas in Germany and the USA

according to the principles of lean

Kendrion Industrial Drive Systems

(IDS) is proud of its long history

in spring-applied brakes.

In the 1990s, however, the company

decided to shift its focus to the

development and production of its

permanent magnet brakes, and

quickly became market leader in

manufacturing. The plant set-up

was segmented into four production

units, each dedicated to a specifi c

area: low volumes, high volumes,

technology lines and customerspecifi

c products. ‘Look upon our

business unit as an orchestra.

We have invested in people and

industrial magnetic systems (ims)

industrial drive systems (ids) michael bernhard

Moving forward with brakes

this segment. As a landmark event

in 2011, IDS developed KOBRA, the

Kendrion Optimised Brake, and has

started winning back some of the

market share it gave up. KOBRA is

a modular design-based standard

product for a variety of industrial

applications. IDS Business Unit

instruments and have reached the

next level in skills and competences.

Now, this year, we will be working

hard on making sure all these

individual elements play together

like a top-class orchestra.’

norman graf

Manager Michael Bernhard is

optimistic about Kendrion’s

prospects. ‘We have the know-how,’

says Bernhard. ‘And we have signed

a fi rst Letter of Intent for the Chinese

market, with production to start in

mid-2012. Kendrion is back in springapplied


annual magazine 2011

annual magazine 2011

Innovative valve design

Kendrion Passenger Car Systems

(PCS) is leading in valves for the

common rail diesel technology.

With a completely new design of

its fuel system valve, and in close

cooperation with a US customer,

PCS has now also penetrated the

very promising gasoline market.

For Business Unit Manager Bernd

Gundelsweiler, this fantastic result

passenger car systems (pcs)

commercial vehicle systems (cvs)

In 2011, Kendrion Commercial

Vehicle Systems (CVS) made a giant

leap forward with the delivery of

its fi rst products to truck OEM

Ashok Leyland after opening up its

greenfi eld operation in Pune, India.

CVS has always been very strong in

the bus market, but is now also

entering the truck market.

highlights the most important

development in 2011.

‘Our spill valve won the Kendrion

Innovation Award, and that success

story is about to get a great sequel

with our acquisition of FAS Controls

in North Carolina, USA, which will be

producing the gasoline valve for

the American market. What else

could you wish for?’

bernd gundelsweiler

Conquering India by truck

Business Unit Manager Bernd

Gundelsweiler explains. ‘A great

combined effort by the whole team

in India and our people in Germany,

based on a very clear strategy. And

with great potential in this quickly

emerging market – we have only just

begun, but we have already started

work on new promising projects

with Ashok Leyland.’

>> 11

>> 12


The world’s energy consumption

has increased immensely in

recent decades. Between 1973

and 2007 world electricity

demand rose by more than 300%.

Expansion of the high voltage

networks necessary to meet this

demand has not kept pace with

this extreme growth. Kendrion

and Siemens are partnering to

design solutions for this growing


Siemens’ 800-kilovolt

extra-high-voltage direct

current transformer.

Joint brainpower:

sparks fl y

The increasing pressure on the existing high voltage transfer systems has led to

considerably higher workloads, stability problems, higher thermal and mechanical

requirements for net components such as wires and lines, generators, transformers

and switches, and – last but not least – an increase in failures and blackouts.

There are many things that can cause a high voltage power distribution system to

fail: lightning strike, human error, overload or storm. But the result is always the

same: short circuits that damage the wires and the network as a whole. In order

to prevent this and limit the damage done to the absolute minimum, electricity

companies require high-quality high voltage switches with extremely fast breaking

times to minimise the risk of down time.

>> More than just a supplier

Gerald Puchner, Manager Research & Development at Kendrion Industrial Magnetic

Systems, explains the partnership. ‘Siemens – a global player in the fi eld of high

voltage power distribution – is constantly looking for the most effi cient and most

powerful solenoids to put in their high voltage switch systems, to give them a

unique selling proposition and competitive advantage. They needed a very fast

trigger solenoid for their high and medium voltage circuit breaker. We have been

selling electromagnets to Siemens for years and years, and this relationship has

grown into a strong partnership. We obviously have the core competencies to be

more than just a supplier, and are now working closely together with them – with

Kendrion bringing in expertise and experience – to design a solution.’

>> Joint effort

On the basis of co-creation, Kendrion and Siemens started researching options,

with the goal of reducing actuator switching times for switching off a high voltage

network in the event of emergency – by two-thirds. The Kendrion Design Engineer

on the project was Markus Rekla. Kendrion presented four options, two of which

did not fully meet the customer’s demands. After going back to the drawing board,

Markus then came up with the idea of combining the principles of a very fast,

dynamic solenoid and a standard solenoid: the hybrid electrodynamic actuator.

>> Sharing information

‘We simulated the solution on the computer and developed a prototype that

appeared to function as expected,’ Markus says. ‘We shared our information

with Siemens and made a sample product for them, which also turned out to be

successful. We are now in the process of starting the fi nal development and

have applied for a patent on the product. A co-creation success story that is to

be continued.’

annual magazine 2011

Real partnership

Karl Mascher is Siemens’ Manager Basic

Development of High Voltage Switch

Systems. He is convinced that by mid-2012

the new hybrid electrodynamic actuator

for Siemens will be available for delivery.

‘We are very happy with the result of our

joint development of high speed actuators,’

he says. ‘It is a very innovative solution,

in fact the only solution that enables us

to realise these very fast breaking times.

annual magazine 2011

We now have to convince our customers

that this state-of-the-art solution also

covers all their safety issues. We offer

them a totally different approach to their

switching problem, so that obviously

takes some getting used to. Siemens and

Kendrion have a valued long history

together and our cooperation – which

started in the 1990s, has always been very

good. For this project we have kept each

other informed on every single detail of

Testing a high voltage Siemens circuit breaker with over one million times the breaking capacity of a household fuse.

the development, from beginning to end.

We didn’t just meet once, but formulated

our assignment and waited for Kendrion to

come back with a solution. This has been

a real partnership. We are now considering

developing a version for bigger and even

more demanding applications, based on the

same principle.’

>> 13

The new cleanroom area in

Villingen is approximately

300 square metres, bringing

the total cleanroom production

space to approximately

900 square metres.

The expansion of the cleanroom

area means a considerable

growth in capacity,

and consequently in the number

of projects. In this way Kendrion

is meeting the increase in current

customer needs that demanded

the addition of a second

production line.

>> 14

Cutting edge

By building the facility

to comply with the

ISO 14644

Class 8 standard,

Kendrion can guarantee its

customers the availability of

the latest technology.

The new block heating in combination with the power system deliver

a phenomenal 75% reduction in energy

consumption for air conditioning. Annual operating costs are

just EUR 20,000, as compared to the EUR 80,000 of the former setup.

annual magazine 2011

The new cleanroom is

connected to the cleanroom

built four years ago.

Kendrion built its fi rst

cleanroom here almost

a decade ago.

A new cleanliness

laboratory and a new

metrology laboratory

to be constructed between

the two cleanrooms are in

the planning stages.

The new cleanroom has also been designed to

optimise logistic processes

(stocks, parts fl ows and avoiding mix-ups) and

laboratory facilities between the cleanrooms.

More than appearances

annual magazine 2011

Some of the most cutting-edge

technology is being used in the

automotive industry. In this sector,

using cleanrooms for the production of

components is a must. A cleanroom is

an environment with a controlled low

level of contamination typically used in

manufacturing or scientifi c research.

Kendrion’s common rail diesel valves

are designed to handle pressures of up

to 2,000 to 2,400 bar, and the standard

will soon be going up to 2,700 bar.

Even the smallest hair or the tiniest

dirt particle could lead to the

malfunctioning of the common rail

system. These valves are therefore

produced in Kendrion’s high-tech

cleanrooms in Villingen-Schwenningen,

Germany, the capacity of which is

being extended.


The development, design and

construction are based

on detailed customer specifi cations

on cleanliness, and the result

has been the client’s complete

certifi cation of Kendrion as an ‘above

state-of-the-art’ cleanroom facility.

>> 15

>> 16

Going global

Kendrion has very strong roots in Europe, with its real production

home base in Germany. But with our new development, production and

assembly sites in Brazil, China, Mexico and the USA, Kendrion has

made no secret about its strategic ambition to become a global player.

The most recent milestones in the company’s globalisation strategy

are the start of a greenfi eld operation in India and the acquisition

of FAS Controls, Inc. in the USA. Read all about Kendrion’s promising

business activities in the mature American economy and in the

dynamic emerging economy of India.

Heavy trucks crossing the Mojave Desert, California

New York by night

Electromagnetism knows

Kendrion FAS Controls Inc.

Shelby, North Carolina, USA

no boun

Travelling northeast from Atlanta, a side road will take you to the tiny city of Shelby,

North Carolina, home to some 21,000 inhabitants as well as FAS Controls, Inc., a company

founded a century ago by F.A. Smith. It was acquired by Industrial Opportunity Partners

(IOP) from Honeywell in 2007, and is soon to become a real Kendrion company after

an agreement between IOP and Kendrion was reached at the end of 2011, much to

FAS Controls Managing Director William Brown’s satisfaction. ‘This is a perfect match,’

he explains. ‘Kendrion is strong in automotive, and we are very well positioned in the

commercial vehicle heavy truck market. Kendrion has found its production location for

orders from its new US customers, in addition to profi ting from the advantages of synergy.

In two to three months our new production lines will be coming in from Italy and

Switzerland, and will be ready for production in 2013. And then, we’ll just do it!’

annual magazine 2011


Famous interchange in Atlanta heavily used by truck traffi c

annual magazine 2011

LINNIG Corporation

Tucker, Georgia, USA


Right in the middle of Georgia – in America’s

southeast, just North of Florida – where temperatures

rarely go below 5°C, lies the city of Atlanta, with

Tucker as one of its suburbs. Also the home of

Coca-Cola, it is from here that Kendrion Linnig

originally covered the American and Canadian bus

markets with its engineering, quality, production and

sales. But three years ago the company also entered

the truck market, with a very successful two-speed

radiator fan drive. With this reliable and durable

system Kendrion Linnig is mainly targeting the

vocational truck segment. ‘With our two-speed

technology we see great opportunities for further

growth. We can offer our customers energy savings

and noise reduction, both of which are solutions

to issues of growing importance here. We will

continue to pursue controlled development looking

for promising niches,’ says Managing Director

Jürgen Häberle.

>> 17

>> 18

Going global (continued)

Harvesters in a vast American prairie

– representative of Kendrion’s agricultural customers

Kendrion Tri-Tech, LLC

Mishawaka, USA

Mackinac Bridge, Michigan, the third-longest suspension bridge in the world

At the edge of Lake Michigan, in the state of Indiana (named for the ‘Indians’,

the indigenous peoples of this area) lies Mishawaka, an economically thriving city with

some 50,000 inhabitants. Here, on Magnetic Drive (!), you will fi nd Kendrion Tri-Tech,

manufacturer of quality solenoids, solenoid valves, actuators, coils and buzzers for the

beverage industry and the medical, power distribution and agricultural markets. Tri-Tech

has been part of Kendrion Industrial Magnetic Systems since August 2008, and now

employs 32. In 2011, the company expanded its plant and offi ce location to meet growing

market demands. ‘That was our best year ever,’ says Managing Director Brad Price, ‘and

we are about to enter new markets with new products. In 2011, we made the transition

from a diffi cult market to many promising developments in the years to come.’

annual magazine 2011

Indian local colour. In Pune’s hinterland many

automotive companies are setting up factories

annual magazine 2011

Kendrion LINNIG India Pvt. Ltd.

Pune, India

Pune – in the heart of western India, not far from

Mumbai – is not only India’s centre of information

technology and education, but also of industry,

especially automotive and diesel engines.

Pune is the country’s eighth-biggest city, home to

more than four million people. It is also the home of

Kendrion’s most recent start-up, which is now fully

operational. With nine people on the payroll and

another six outsourced, Kendrion India has started

supplying its fi rst products to a customer in the truck

market. ‘These fi rst products have been wellreceived

by our customer,’ says Managing Director

Sameer Deshmukh. ‘We are now ramping up

production. Our objective for 2012 is to fully meet

the customer’s demands, in quality and quantity.

New projects will help us realise our ambition to

move from single shift to full shift production.’

>> 19

>> 20

Picture riddle

Challenge your brain and fi nd out what you are looking at? Defi nitely, there is Kendrion inside…

See www.kendrion.com/Investor Relations/Introduction for the solution.

Make a guess

annual magazine 2011


Innovation makes a previous product look outdated. And isn’t

that what we all want – to outclass our competitors and

ourselves? Make better or more effective products by using

enhanced processes and technologies? We sure do. So let’s

innovate. But how? Many companies struggle to be innovative or

stay innovative. Only 7% of all innovations make it to the market

and become a success. The very best companies have success

rates of 30%. The innovation process is often long and diffi cult.

Strict measures of quality management can help to enhance the

innovation process, but also make this longest of processes

even longer and increase the mortality rate of innovations within

the company – unless you add behavioural aspects.

Activate your

innovation cells

Behavioural innovation management, also called social

innovation, uses fi ve basic principles to orient a company

towards new and innovative behaviour. One: rhythm, which can

turn innovation into a habit. Two: a combined top-down and

bottom-up approach, which means that the goals come from top

down and opportunities and risks come from bottom-up. Three:

we also need an inner compass to tell us whether we are on the

right track. Four: ambitious goals are also indispensible, but

they need to be broken down into manageable steps. And last

but not least, we want drive. Drive enables teams to reach peak

performance. The tension between opportunity and risk can fi re

up individuals and teams alike. It mobilises entrepreneurship.

In addition to challenge, companies should also allow

entrepreneurship from within. One way to do so is by using

innovation cells. An innovation cell is a venture within the

company. One of the typical ingredients for an innovation cell is

an interdisciplinary team on one location working towards one

goal, a goal set out in a contract. Fixed preconditions ensure

effectiveness and pace. In addition, a challenging project creates

urgency and tension to stimulate creative potential. A critical

jury, including a panel of experts, provides regular feedback.

A high degree of autonomy and skills guarantee that the

challenge can be met. Next, break down all hierarchical

structures. Now all you need is a coach to jump start the team

and you’re on your way. Intrinsic motivation and fl ow will push

your innovation cell to heroic heights. And will make the

previous product look old. If you’re lucky.

annual magazine 2011

How to make

your last product

look old

prof. dr. burkard wördenweber

is managing director of phasix

gesellschaft für innovation mbh,

lippstadt, germany. he is honary

professor at the paderborn university,

germany and consultant in innovation

management. prof. wördenweber is

member of kendrion’s innovation board.

>> 21

>> 22

Tomorrow’s Wilhelm Binders

With his inventor’s spirit and wealth

of ideas, Dr. Wilhelm Binder led the

company his father founded in 1911 to

prosper and grow into what it is today:

an internationally-oriented, wellpositioned

industrial company

excelling in the commercial

application of the physical principles

of electromagnetism. His inventive

mindset and his visionary spirit

are still alive and kicking

100 years later.

‘I learn something new every

day. And what I really like is

that we are always taking our

products to the next level.

There is no end to innovation,

that’s what I live for.’

Manfred Gebhart (54) has been with

Kendrion Linnig for ten years now

and has specialised in the

development of innovative solutions

for buses, special vehicles and

genset applications. Over the years

he has seen big changes in the

relationship with customers where

innovations are concerned: ‘We now

control virtually all aspects of the

innovation and product development

cycle. While in the past, we might

have left it to our customers to test

newly developed products, now a

customer expects a product to meet

all his requirements and demands

right out of the box.’

>> Small, light, clean

‘Small, light and clean are the

central drivers of our innovative

developments. Take our clutches

for compressor drives. We constantly

work on the effi ciency of our

products, offering Original

Equipment Manufacturers (OEMs)

considerable benefi ts from an

energy reduction and cost saving

point of view. The customer expects

our quality to be high. That has

always been and still is Kendrion

Linnig’s reputation in the market.

Our quality image even makes Asian

customers choose our product,

even though they can get lower

prices elsewhere. German products

are hot!’

manfred gebhart

commercial vehicle systems (cvs)

>> Design and adapt

‘A new and very promising

development is our “Terminator

pneumatic fan clutch”. We are in

the process of getting this product

patented and have introduced four

different sizes for the American

market. We are also planning to

enter the Australian market with this

new product. Requirements differ

from those in the USA. But just like

we do for the Asian market, we

adapt our basic product to local

circumstances and demands.

This enables us to do things like

get our prices as low as we can go

without violating or negatively

infl uencing our quality. Talking about

being innovative...’

annual magazine 2011

‘Venturing beyond the

boundaries of our knowledge

and experience is very

challenging: exploring new

territory and questioning

what we know, what we do

and how we do it.’

Coincidentally, Miriam Kreutter (30)

and Ralf Heingl (40) have both

worked for Kendrion since 2006

– Ralf as a Development Engineer,

Miriam fi rst in marketing and now in

project management. At the moment

they are working closely together

on the development of a customerspecifi

ed high pressure valve and

taking it to batch manufacturing

level. ‘In this joint project with the

customer we have managed to

reduce the number of interfaces,

and in doing so, to decrease the

development time. This enabled us

to meet our customer’s demands

optimally and to add our know-how

to the development of the next

generation of engines.’

annual magazine 2011

>> Creativity

‘Innovation happens on the way to

your goal. It all begins with the

customer’s requirements. Often you

don’t even know how you are going

to meet them when you start. While

investigating concrete solutions,

immature ideas leap out at you,

and these are what eventually lead

to innovations. Creativity and the

freedom to use it are key factors

in the idea-generating process.

Innovation means daring to venture

beyond the boundaries of our

knowledge and experience. Often

a very challenging adventure.’

ralf heingl and miriam kreutter

passenger car systems (pcs)

Innovation happens

on the way to your goal

>> Confident

‘Personal contacts with a customer

are very important. They enable

us to get and stay ahead of other

players in the fi eld. Simply by being

the fi rst one the customer thinks

of and the one he has in mind with

his preliminary ideas gives us the

opportunity to participate in the

defi nition of the specifi cations

and demands our products have

to meet.’

Ralf Heingl and Miriam Kreutter are

confi dent that after successfully

fi nishing this project, Kendrion will

be in a position to develop a similar

product for other OEMs.

‘There’s nothing more challenging

than exploring new territory and

questioning what we know, what

we do and how we do it.’

>> 23

‘If you want to be creative

and innovative in your fi eld

of business, you need to

have the expertise and the

experience. It’s not enough

to know where to fi nd it or

look for it.’

Markus Rekla (38): ‘As a child and

teenager here in Villingen, Germany,

I saw well-known companies with

great reputations slowly going

downhill and in many cases

ultimately disappearing. Later in life

I came to understand that these

companies did not see the signs of

the times, lived on their success for

too long and simply responded too

late to changes in their environment.

>> Out of the box

‘As far as I am concerned, it all starts

and ends with developing and

acquiring knowledge. I think it’s

wrong to assume that knowing

where to fi nd the knowledge you

need is all it takes. Nothing comes

from nothing, if you ask me. That is

why I will never say that I know

everything about electromagnetism

and that if I can’t fi nd a solution

>> 24

Tomorrow’s Wilhelm Binders (continued)

there is no solution. Innovation is a

matter of thinking out of the box,

walking down unconventional paths,

working together and cleverly

combining insights and knowledge

from different areas.’

>> Talented people

At the moment Markus spends most

of his time working on the hybrid

electrodynamic actuator for highvoltage

switching applications, for

which speed is the most important

requirement. ‘Whenever I come up

against something interesting or

promising, Kendrion never puts any

obstacles in my way. I’ve always

been given the time and resources

I need for further research.

And that’s great because I think

creativity can only get sparked if you

get the time to really dive into the

matter. That’s the way to bind

talented people to your company!’

markus rekla

industrial magnetic systems (ims)

annual magazine 2011

‘Innovative engineers make

life easier and contribute to

more safety and convenience.

My ambition is to be part of


Waldemar Schaermann (30) has

worked at Kendrion since June 2010,

but his history with the company

goes back further than that.

While doing his studies, he did an

internship with Kendrion in 2006

and he wrote his fi nal thesis at the

business unit Industrial Magnetic

Systems in Donaueschingen,

Germany, in 2008. Today Waldemar

is the manager – and together with

Roland Benzing the developer and

engineer – of the KOBRA spring

applied brake project. ‘My fi rst “big”

project, and targeted at creating a

new design with new features and at

minimising manufacturing costs.

The product’s main benefi t is its

annual magazine 2011

modularity. We build a variety

of types, based on specially

constructed and reusable


>> Inquisitive and interested

‘Sometimes ideas come to me like

fi reworks. They just pop into my

head while I’m brainstorming, or at

other times, like when I’m in bed

with a problem keeping me awake.

I rarely stick to a fi rst idea, though.

I always try to fi nd alternatives or

other options. I’m basically very

inquisitive by nature and interested

in many different subjects and

topics, which really helps a lot.’

Waldemar is currently developing

another variety of a spring applied

waldemar schaermann

industrial drive systems (ids)

Sometimes ideas come to

me like fi reworks

brake for one of IDS’s biggest

customers. He is also working on

a miniaturised version, which places

extremely high demands on the

technical side.

>> High-level requirements

Kendrion must be innovative to be

competitive. The customers in so

many sectors all over the world have

their own high-level and complex

technical specifi cations. We can

meet these requirements and work

closely with our customers to fi nd

the best solutions. That’s where

innovation happens. We are certainly

on the right track with regard to

innovation, but that doesn’t mean

we can afford to relax.’

>> 25



>> 26


20.000 m

15.000 psi

10.000 psi

Less fuel,

more power

In 2008, Kendrion Passenger Car Systems (PCS) began the

development of a product for gasoline engines, similar to

PCS’ proven successful high and low pressure valves for

common rail diesel engines. The totally different

requirements and intensive process of development

demanded testing and targeted marketing. The spill valve

was specially designed for gasoline direct injection

technology, facilitating lower fuel consumption and higher

effi ciency for impressive overall performance

improvement. In 2010, an initial Letter of Intent with a

US-based company marked a break-through in the

gasoline engine sector and, equally importantly,

promising fi rst steps on the American market.

Together we design

a solution

annual magazine 2011

Small things


ø 14 mm

When a renowned supplier to the aerospace

industry needed an impossibly tiny

electromagnetic brake for a new highprecision

device, Kendrion Industrial Drive

Systems was there with a unique solution:

a 14-mm diameter brake, the smallest in

the world. With special functional features

in the production and assembly process,

Kendrion was able to reach the exact

balance between excellent miniaturisation,

power consumption and cost structure

that the supplier needed. After successful

development and testing of the fi rst

prototypes, the focus is now on selecting

prototypes for pre-series and preparation

for production. The result is a recordbreaking

product and a smart

production process.

annual magazine 2011


fast breaking

times minimise

the risk of down time

197 FT 1.5 IN


>> 27

>> 28

Back to the future

Trending topics in electromagnetism

What does the future of electromagnetism look like?

What trends can we discern? What developments might

impact Kendrion’s ambitions? We asked a number of

specialists and scientists working in different areas of

applied magnetism to peek into the crystal ball

and share their ideas with us.

>> Overall design partners

Up to now, solenoids have generally been seen as

sub-systems to be ordered and built to customer

specifi cations. While this approach results in clear

design responsibilities, it often fails to lead to the

best overall solution, because of fi xed design

constraints dictated by the overall system structure.

In many cases it would be possible to obtain much

better overall system performance if the designer

of the solenoid would be allowed to take part in

the overall design optimisation and contribute

expertise at a very early design stage.

Kendrion’s future success will also depend on

our ability to understand customer applications

and learn how to approach customers with new

ideas for improved overall system structures.

>> How electromagnetism helps save energy

Energy saving is a hot issue in all markets, especially for large solenoids with

high power consumption. As a result, Kendrion’s solenoids, which help to

reduce energy consumption in all kinds of areas, have become indispensable.

Global warming and the growth of the world population are forcing us to

move to new, more energy-effi cient systems, and this is driving the demand

for new application areas for solenoids. We consider the continuous further

development of these our social responsibility. The future of solenoids will

be shaped by the increasing need to conserve energy.

annual magazine 2011

Design integration of electromagnetic components

As demands in miniaturisation have increased, device packaging has become more and more

important. This trend is not limited to small scale systems. It is also important for large scale systems,

like the motor-shaft mounted cooling fan in a truck diesel engine with its electromagnetic clutch.

Various kinds of environmental stress, like high temperature and strong vibration environments,

then have to be taken into account in the design of the electromagnetic components and their

protection. Model-based design, lifetime durability analysis and accelerated experimental test

strategies will be important issues in the design of electromagnetic components.

annual magazine 2011

And now the good news…

there is no alternative

>> The mechatronic approach

Products are moving more and more from specialised

electromechanical solutions towards fully mechatronic

devices, such as electronic circuits and computer

numeric control devices. Consequently, an optimum

design is one that includes both solenoid and electronic

controls. Electronic expertise and capabilities in R&D

and sales need to be updated. The markets demand

a provider for mechatronic solutions.

There is no adequate replacement for solenoids on the horizon.

Other actuation principles, such as piezoelectric actuators,

voice coils, and shape memory actuators all have their own

specifi c ranges of application and generally cannot be suitable

replacements for solenoids.

>> 29

>> 30

Social and responsible

Running a business is a complex process

involving a number of very diverse elements

and components. Ecology and environment,

human resources, raw materials, equipment,

energy, supply chain cooperation, corporate

governance… the list goes on.

Doing business in a responsible way that

respects all these aspects is every bit as

complicated as this sounds, and demands

clear and transparent policy. The number

of companies developing such a policy is

growing. Kendrion is one of them.

In 2011, the company installed

an internal Corporate Social

Responsibility (CSR) Board to focus

on a few major themes: energy,

business ethics, supply chain

cooperation and human resources.

Within Kendrion, human resources

are a crucial area. The company

sees its people as its vital asset for

further development and is highly

concerned with aspects such as

employee satisfaction and health,

sickness and accident fi gures. This is

why Kendrion has implemented and

continues to implement all kinds of

measures that not only benefi t

Martina Bodenlos on babies and business

Kendrion but secure the retention

and satisfaction of its talented and

ambitious professionals.

>> Work-life balance

One important part of this is the

work-life balance: combining the

professional and personal life in an

effective, productive and healthy

way. ‘The discussion should not be

about Kendrion or private life, but

about Kendrion and private life,’

explains personnel specialist

Sandra Hoer. ‘We want to facilitate

our people in fi nding the right

balance between their job and their

Martina Bodenlos, a member of the Kendrion IDS marketing team, has been with the company

for more than eleven years. She started working again soon after she had given birth to

her daughter. Mainly from home, but also in the offi ce when needed, making use of the

Kids@Kendrion room: a special workspace combining a fully-equipped desk for the mother

and a fully-equipped play area for the child. ‘Simply fantastic,’ says Bodenlos. ‘During my

pregnancy and right after, this is where we met for quarterly information sessions and for a

cup of coffee with other mothers. That’s really important to stay on top of what’s happening.’



the Kendrion


family life. At the moment we have

seven women in the company in

Villingen, Germany, who are either

on maternity leave or with very small

children and working part-time.

In the past, when employees like

these had their babies they were too

often simply lost to Kendrion. We

now aim to keep these expectant

mothers involved and engaged by

staying in touch with them during

their maternity leave and after they

have given birth. The pressure on us

to keep our good employees is

greater than ever.’

>> Flexible solutions

Kendrion’s basic rule in this is:

create fl exible solutions on an

individual basis. The company

attaches high value to diversity

in the workforce and to equal

opportunities. ‘In order not to lose

knowhow and experience, we are

fl exible in reaching agreements,

especially with our female

employees,’ says Hoer.

annual magazine 2011

‘The discussion should

not be about Kendrion

or private life, but about

Kendrion and

private life.’

‘We talk to each of them personally about

how they want to go about their new life.

When do they want to come back?

What kind of work could they do in their

particular situation? What instruments do

we have to provide them with? In this way

we arrive at individual solutions, such as

enabling a person to work from home

while maintaining contact with colleagues

or customers using a data connection.’

>> Personally

Sandra sees the situation from both

sides, because she herself is one of

the expectant mothers about to go on

maternity leave. ‘As far as I can assess

now, I plan to not work for about a year

but intend to come back after that,

if possible combining telecommuting

and coming to the offi ce. So if you ask

me whether our fl exible solutions work

as planned and intended, I can tell you

that I’m going to fi nd out fi rst-hand.’


annual magazine 2011




In Kendrion’s CSR policy,

environmental issues – energy

consumption, CO2 reduction,

sustainability – are a paramount

consideration, and we show it in two

ways. In our products, our goal

is to support our customers by

supplying the market with lowenergy

and CO2 emission-reducing

products and systems. At the same

time we focus on manufacturing our

products as effi ciently as possible,

using a minimum of energy and

emitting a minimum of CO2 ourselves

in the process. A recent example of

Kendrion’s attention to this is the

new combined heating and cooling

unit at the Villingen (Germany) plant.

Facility Manager Heinz Jankowski,

explains. ‘We have installed a stateof-the-art

system, which generates

240 kW electrical power and 362 kW

thermal power. It not only powers

our machinery, but it heats in winter

and cools in summer. ‘Not only

does this mean quick return on

investment, but also reducing our

energy consumption by 15% and our

CO2 emission by 600 tonnes per

year. Apart from this our energy

reduction programme entails smaller

projects, such as regaining heat from

our production processes.’

>> 31

>> 32

Let’s get personal

electromagnetic stops

Opening the boot of a car is easy with

a radio-controlled key. An electromagnetic

stop ensures that the boot does not

accidentally close on someone’s head

and that when closed, the boot locks

again at the touch of a button.

Kendrion magnetises

the world

car controls

A solenoid control valve ensures that the

perfect mix of fuel is fed to the combustion

chamber of your car. The solenoid on the

camshaft sets the perfect angle for the cam

to actuate the intake and outlet valve for

the perfect performance-consumption ratio.

The result: a powerful yet economical car.

cash dispensers

Solenoids in cash machines

sort, count and dispense the

amount asked for.

climate controls

A number of solenoids

ensure that the

temperature on climatecontrolled

buses is always

just right. These solenoids

also help save energy and

protect the environment.

Bet you didn’t know that not a day goes by

without you activating thousands of solenoids.

Let us show you how this works and introduce

you to the benefi ts electromagnets bring to you.

When switching on a coffee machine you hear the

familiar sound of three electromagnetic functions:

the pump, the dispenser, and the press.

lift systems

The sliding door of a lift

locks so you can’t fall

into the lift shaft. The lift

stops at the right fl oor.

An electromagnetic brake

holds the lift in position.

And there is an

additional safety lock,

operated by an

electromagnetic overspeed


keeping you safe.

annual magazine 2011

wind energy

The pitching system of a

wind power plant is held and

positioned by a permanent

magnet brake. When the

pitches have to be repaired,

the brake ensures they

slow down smoothly.

filtration pump

in renal dialysis

Renal dialysis is a medical

process that becomes

necessary when the normal

functions of the kidneys

become compromised by

kidney failure. A Kendrion

solenoid in the fi ltration pump

pumps dialysate through

the dialyzer so contaminants,

toxic substances and water

will be separated from the


printing presses

In printing presses, solenoids

ensure that motors are slowed

and stopped, paper is cut,

solenoid valves for the paper

feed are actuated and paper

is dusted so that it doesn’t

stick together.

annual magazine 2011



State-of-the-art sensorcontrolled

taps are

operated by an

electromagnetic valve

under the sink.


Engine heat is strongly affected by a number of different

factors, including ambient temperatures and load profi le.

Our fan clutch lets you control the fan speed, so you can

lower fuel consumption and CO2 emissions, putting reduced

operating costs at large volumes within your reach. For use

in power units like power plants or hospital generators.

automatic looms

Cardigans and jumpers are

manufactured on fully automatic

looms with 100 electromagnetic

parts. The same can be said for

much of what you wear: the seams

of trousers and the buttons on

jackets were also sewn with the

help of solenoids.

garbage trucks

Garbage bins are emptied into a truck.

An electromagnetic clutch is controlling

the hydraulic system that compacts

the rubbish.

Without being aware of it, in the course of a day one operates some

1,000 solenoids, many of them products of top quality brands.

What would our lives be like without solenoids?

>> 33

>> 34

The Kendrion Executive Programme

Building knowledge

and networks

Permanent education and personal growth

are at the core of Kendrion’s development

towards global market leadership and

a continuously innovative and strong

technology position. At the same time,

education and training challenge our

employees to grow. By offering these

opportunities, Kendrion aims to keep

its employees at all levels engaged and

interested, with the end result of retaining

expertise and experience within the

company, thus creating a mutually benefi cial

and self-sustaining cycle. As part of the

Kendrion Human Resources development

programme the management follows

a comprehensive training course at

the Rotterdam School of Management,

in the Netherlands, comprising of a series

of management and leadership modules:

the Kendrion Executive Programme.

laurent lebas managing director

kendrion magneta, germany

‘So far all modules have met my high expectations. But because

of my background I personally enjoyed Sales & Marketing by

Marian Dingena best. It really helps to step back a bit and look at

things from a strategic perspective. Some of the lessons learned

I could apply in practice straight away.’

brad price managing director

kendrion tri-tech, usa

‘The Kendrion Executive Programme offers the best set of

classes I have ever had. The programme has helped me to

grow in all aspects of the business. Each module gives me

something unique I have never experienced before. And I enjoy

the contacts with my international colleagues as much as the

programme itself.’

wijgert gooijer corporate

secretary/legal counsel,

kendrion n.v., netherlands

‘If I want to be a good business advisor

from a legal point of view I need to know

as much as possible about all business

processes and their relevance from a

risk perspective. That’s what the

programme teaches me. It is a highquality

programme and a great

opportunity to meet my colleagues.’

annual magazine 2011


The Kendrion Executive Programme

is a customised, international

modular teaching programme in

collaboration with the Rotterdam

School of Management (RSM).

Apart from the subject content the

programme offers a challenging

platform for internal networking,

the exchange of experiences,

sharing opinions and discussions

on business issues between the

participating managers. It also aims

to expand collaboration between

the business units and operating


armin beck head of project management

pcs, germany

‘The sponsorship by a Board or top management member

demonstrates how involved they really are.

In one of the modules Piet Veenema was my partner.

He was not there just for appearances, but really engaged

in the activities and was not afraid to show vulnerability.

I respect that.’

annual magazine 2011

>> Sponsor

The Kendrion Executive Programme

offers six modules over a total of

three years. The subjects covered

are communication & leadership,

sales & marketing, strategy, logistics

& supply chain management,

HR and project management.

The programme consists of generic

elements and theoretical insights,

but the content of each module is

tailor-made and adapted to the

Kendrion situation and day-to-day

business as much as possible.

This is how the programme

continues to meet the specifi c needs

ralf wieland director production and quality

management, kendrion binder magnete gmbh,


‘It’s absolutely fantastic and inspiring to meet colleagues from

outside my own business unit. In combination with the content of

the modules it gives me a chance to look into different aspects of

the business and into management topics. For me information

sharing within Kendrion is the programme’s most valuable asset.’

alexander glaser managing director

linnig de méxico, mexico

‘The Kendrion Executive Programme shows that Kendrion is

interested in motivating, developing and training its employees,

and in cooperation between different business units. My favourite

module is the marketing module, because it puts the focus back

on the customer. We learned a lot about how to assess new

customers and how to see the customer’s needs. Useful lessons

and processes for every day.’

of the company and participants.

Each module is ‘sponsored’ by a

Kendrion Board or top management

member, who is not only involved in

preparing the course but also has

an active role to play when the

participants meet in Rotterdam.

werner schneider

director supply chain &

controlling pcs, germany

‘Good teachers, state-of-the-art

approach, not just sitting and

listening but interactive

participation, and always a very

practical link to our day-to-day

business. My focus is fi nance and

purchasing, but getting to know

other parts of the business is very

enriching. Leadership was my

favourite module so far. It gave me

a lot of insight into my own


>> 35

>> 36

Bottomline Financial performance

Continuing growth

After the 2010 recovery from the economic crisis with 43%

organic growth, Kendrion continued this pace, achieving

further growth of 21%. This growth, in combination with

the acquisition of FAS Controls, Inc. in North Carolina,

USA, pushed Kendrion’s annual turnover to almost

EUR 300 million. The growth also had a further positive

effect on Kendrion’s operational results, helping the

company control its increasing costs. The reported results

over 2011 were negatively infl uenced by the fourth

quarter supplementary provision for the EC fi ne of over

EUR 39 million including legal expenses, as well as oneoff

acquisition expenses and a centenary bonus to our

employees. The numbers beyond those reported were

very good, with a normalised net profi t of EUR 20.5 million,

an increase of 39% over 2010.

>> Trust from our banks

Even with the provision for the EC fi ne, Kendrion’s bank

consortium, consisting of ING Bank, Rabobank and

Deutsche Bank, is convinced of the company’s strong

fi nancial position, and approved our request for an

additional acquisition facility of EUR 60 million in January

2012. The headroom for acquisitions is now approximately

EUR 70 million.

>> Increasing our global footprint

Kendrion is striving to become less dependent on

Germany and to spread revenue to other continents

worldwide. However, Kendrion’s current growth is largely

due to the success of the German economy and the

country’s strong export position in both the automotive

and Far East industries. Compared to last year, the spread

of revenue, based on customer location, developed as


EUR million 2011 Share 2010 Share Growth

Germany 148 55% 134 60% 11%

Rest of Europe 65 24% 51 23% 27%

Americas 20 8% 17 8% 19%

Asia 32 12% 18 8% 79%

Other 3 1% 2 1% 19%

Total 268 222 21%

Growth was evident in all regions. Germany’s share

decreased, while Asia had a larger share of revenue

during 2011. The strong growth was achieved in the

automotive, bus and truck business (China, India and

Thailand). Growth in the American countries was about

equal to the overall Kendrion growth. With the acquisition

of FAS Controls, the share of revenue in the Americas

automatically increases pro forma to 17%, whereas the

share of Europe is reduced from 79% in 2011 to 72%.

Kendrion understands that a signifi cant proportion of

the increased sales to customer bases in Germany was

destined for products they manufactured for their Asian


>> Cash flow

Kendrion’s free cash fl ow, being the net cash fl ows from

operating activities minus the cash outfl ow for

investments in capital expenditure and software in 2011

came out at EUR 14.6 million (normalised), being 71%

of our normalised net profi t – very satisfying given the

further organic growth and investments exceeding


>> Flexibility

Kendrion will retain its focus on fl exibility. Steps have

been taken to further improve the quality of the periodic

measurements. Flexibility came under pressure during the

year under review due to the scarcity on the German

labour market which resulted in a lack of available highlyqualifi

ed temporary staff and new employees’ nonacceptance

of fi xed-term contracts. Nevertheless,

throughout 2011 Kendrion’s fl exibility rate fl uctuated

between approximately 20-30%. This latter percentage

takes account of government working-hours reduction


Kendrion carried out a sensitivity analysis to review the

relationship between a potential decrease in revenue

and the operating result.

Kendrion strives to keep pace with the volatility of market

demand and ultimately to mitigate a 35% decline in

revenue before incurring an operating loss and without

annual magazine 2011

edundancy expenses. However, as this is not feasible for

a longer period, structurally lower revenues result in the

need for fundamental changes to the organisation.

>> Dividend and profit appropriation

Kendrion endeavours to realise an attractive return for

shareholders, supported by a suitable dividend policy.

However, to provide the necessary assurances for its

continuity the company needs to retain a healthy fi nancial

position. When the dividend to be distributed to

shareholders is determined consideration also needs to

be given to the amount of profi t to be retained to support

the medium and long-term strategic plans of the company

and to maintain a minimum solvency ratio of 35%.

Kendrion strives to distribute an annual dividend of

between 35-50% of the net profi t. In principle, Kendrion

offers shareholders an opportunity to opt for dividend

in cash and/or in the form of ordinary shares in

Kendrion N.V.’s capital.

The Executive Board shall, in line with the new dividend

policy and with the approval of the Supervisory Board,

submit a proposal to the shareholders for the payment of

a dividend of 35% of the normalised net profi t of 2011.

The dividend is equivalent to an amount of EUR 7.1 million

(EUR 0.62 per ordinary share with a nominal value of

EUR 2.00 each).

A proposal will be submitted to the shareholders during

the General Meeting of Shareholders on 16 April 2012 for

the payment of the dividend, at the shareholder’s

discretion, in cash and/or in ordinary shares.

>> Prospects

The company made further progress in the implementation

of its strategy, and was able to realise an excellent return.

A strong fi nancial position, being a niche player and

having the ability to innovate are the features that will

form the basis for Kendrion’s further growth in the coming

years. In 2012, Kendrion will strengthen its investment

in its own organisation in view of the many growth

opportunities and the progress that has been made in

recent years. These plans are established in our Mid-term

Plan 2012-2014 entitled ‘Entering another league’.

Uncertainty regarding the future development of the

global economy is still high. Nonetheless, Kendrion would

appear to have an advantage in the fact that a sizeable

proportion of its revenue is realised in Germany, the

annual magazine 2011

country that currently is driving the European economy.

There is also uncertainty regarding developments in the

company’s other important home markets of China and

the USA, although the fi rst tentative signs of optimism

are beginning to appear in these countries. Based on

the information currently available, Kendrion expects to

achieve further growth in its revenue in 2012, mainly from

the projects acquired and developed by the Industrial

Magnetic Systems and Industrial Drive Systems business

units in recent years. The Passenger Car Systems business

unit does not expect to realise substantial growth in its

revenue from new projects in 2012 because of the time

needed to develop new projects, for instance for the US

market. Further growth in revenue is expected from the

second half of 2013. The Commercial Vehicle Systems

business unit expects to achieve further growth, mainly in

the BRIC countries. In addition, FAS Controls, Inc. will

begin to contribute to the revenue and result in 2012.

Kendrion will continue to strive to strengthen its market

position through acquisitions. The focus will remain on

acquiring strong niche players in Germany, Kendrion’s

most important market, however Kendrion will also look

to grow further especially in the USA and China in order to

further reduce its dependence on the European market.

While Kendrion looks to the future with a high level of

confi dence and expects to achieve a further improvement

in its revenue and profi t, the situation is such that

concrete forecasts regarding the development of its profi t

performance would not be appropriate at this stage.

>> 37

Bottomline Financial performance (continued)

EUR million, unless otherwise stated



2010 221.9

2011 267.9 + 21%

1, 6

Operating result before amortisation (EBITA)

2010 24.2

2011 30.7 + 27%

Operating result before depreciation and amortisation


2010 32.9

2011 40.0 + 22%

Normalised net profi t 2

2010 14.8

2011 20.5 + 39%

EBITA 1, 6 /invested capital 4, 5 (ROI)

2010 18.7%

2011 22.2% + 19%


> >



Net investments

2010 8.9

2011 13.5 + 52%

Depreciation and amortisation

2010 10.1

2011 10.8 + 7%

Solvency (total equity/balance sheet total)

2010 64.7%

2011 40.0% -/-38%

3, 8

Working capital in % of revenue

2010 11.7%

2011 11.8% +1%

Share information 2

Normalised net profi t per share (EUR)

2010 1.30

2011 1.79 + 38%

EUR million, unless otherwise stated 2011 2010

Normalised net profi t 2 20.5 14.8

Organic growth 20.7% 42.9%

Net interest-bearing debt 25.9 5.2

Net interest-bearing debt / equity (gearing) 0.28 0.05

Net interest-bearing debt / operating result before depreciation and

amortisation (EBITDA) 5, 6 (0.07) 0.16

Operating result before amortisation (EBITA) 1, 6 / net fi nance costs 15.3 8.1

Outstanding shares at year-end (x 1,000) 11,493 11,316

>> 38 annual magazine 2011





Realisation of targets

Organic growth

Target > 10% per year

Actual 20.7%

Return on Sales 6 (ROS)

Target > 10.0%

Actual 11.5%

4, 6

Return on invested capital

Target > 17.5%

Actual 22.2%

Other information

In EUR, unless otherwise stated 2011 2010 2009

Number of shares x 1,000 at 31 December 11,492 11,316 11,316

Market capitalisation at 31 December, EUR million 189.6 164.1 105.8

Enterprise value (EV) 215.5 169.3 119.7

Highest share price in the fi nancial year 18.99 15.10 10.30

Lowest share price in the fi nancial year 13.25 8.82 6.59

Share price on 31 December 16.50 14.50 9.35

Average daily ordinary share volume 17,489 13,642 4,230

EBITDA multiple (over EV) 5.39 5.10 9 9.30

Result normalised per share 1.79 1.30 0.37

Share price earnings ratio 9.27 9.93 26.71


EBITA excluding amortisation related to acquisitions

(part of other intangible assets).


Excluding EC fi ne and a.o. acquisition expenses in 2011

(2010 excluding incidental tax benefi t).


3 Working capital and revenue are excluding FAS Controls, Inc.


Total invested capital is property, plant and equipment,

intangible assets and current assets less the current tax liabilities,

trade payables and other payables.

Target not below 35%

Actual 40%

Ratio of interest-bearing debt


Target < 3.00

Actual 0.60

Free cash fl ow 7


Net interest-bearing debt, working capital and invested capital

is excluding FAS Controls, Inc.


Excluding EC fi ne and a.o. acquisition expenses in 2011.

7 Before cash fl ow relating to acquisitions.

8 Excluding an earn-out liability at year-end 2010.

9 Before Springtime (reorganisation plan).

Target healthy free cash fl ow in

relation to organic growth

in % of net profi t

Actual 71%

Dividend distribution

Target between 35-50% of

net profi t

Actual 35% of normalised

net profi t

annual magazine 2011 >> 39

Bottomline Financial performance (continued)

>> Developments in each business unit

Industrial Magnetic Systems

The Industrial Magnetic Systems business unit reported

a 14% increase in revenue in 2011. The increase was

achieved both by the introduction of several innovations

(including in machine building) and sharply rising

volumes at the principal existing customers, for instance

in machine building and the energy sector. A further

refocusing of sales and engineering activities by market

segments was carried out. A new sales offi ce was opened

in Italy in 2011. In addition, effi ciency was further

improved by further selective distribution of the activities

across the various production locations. The international

presence of Kendrion in the USA and China is a major

advantage. The business in the USA was signifi cantly

expanded with a view to future projects. There is a

considerable focus on further expansion of the activities

in China.

Industrial Drive Systems

Revenue of the Industrial Drive Systems business unit

rose 19% in 2011. Following the enormous growth in 2010

there was therefore also strong revenue growth in 2011,

attributable to the good performance of German machine

building, where this business unit has a strong market

position in the fi eld of brake systems for servomotors.

New products (under the name KOBRA – Kendrion

Optimised Brake) were developed, which will be

introduced in the market in 2012. The innovation of the

world’s smallest permanent brake system produced a new

order for the US aviation industry. Effi ciency and fl exibility

improved through selective investments in production.

In the second half of the year 2011 this business unit did

however have to contend with very sharply increased

prices of permanent magnets. Although these price rises

were passed on to the market, this occurred with some

delay. China and the USA are the main geographical areas

of expansion. In particular, major progress was achieved

in 2011 in China by the acquisition of new customers and


Passenger Car Systems

Passenger Car Systems achieved the highest organic

growth of revenue in 2011, of 30%. This business unit

experienced revenue growth in the course of the year

due to the strong increase worldwide of sales of the

German automotive industry, with revenue growth in

fact outpacing market growth due to the successful

introduction of several new projects. The Passenger Car

Systems business unit is responding swiftly to prevailing

trends in the automotive market (motor management,

downsizing of parts, greater switching ability, fuel

economy and CO2 reduction). Many new projects were

acquired as a result in 2011, which will lead to strong

revenue growth again as of 2013. With the acquisition of

FAS Controls, in combination with orders received earlier

in the USA, Kendrion signifi cantly strengthened its market

position in that country and strong growth is expected in

the coming years.

Commercial Vehicle Systems

The Commercial Vehicle Systems business unit achieved

revenue growth of 11% in 2011. The revenue growth was

achieved both in Germany and in the Far East. A greenfi eld

operation was launched in India, which is expected to

grow strongly in the coming years. Production

commenced at that location during the fourth quarter.

Growth in the US market was pressured by challenging

market conditions in the US bus market. By contrast,

new customers were acquired in the US truck market,

offering promising prospects for the coming years.

The engineering capacity of this business unit was

signifi cantly expanded in the second half of the year, with

a view to the growth targeted in the global truck market.

This business unit is able to pass on the sharp price rises

of permanent magnets to its customers for a considerable

part, but again with some delay.

>> 40 annual magazine 2011

Financial calendar

Wednesday 29 February 2012 Publication of the 2011 full-year fi gures

Monday 19 March 2012 Record date General Meeting of Shareholders

Monday 16 April 2012 General Meeting of Shareholders

Wednesday 18 April 2012 Ex-dividend date

Friday 20 April 2012 Dividend record date

Monday 23 April – Monday 7 May 2012, 3 pm Dividend election period (stock and/or cash)

Tuesday 8 May 2012 Determination stock dividend exchange ratio

Wednesday 9 May 2012 Publication of the results for the fi rst quarter of 2012

Thursday 10 May 2012 Cash dividend made payable and delivery stock dividend

Thursday 23 August 2012 Publication of the results for the fi rst six months of 2012

Wednesday 7 November 2012 Publication of the results for the third quarter of 2012

Wednesday 27 February 2013 Publication of the 2012 full-year fi gures

Monday 15 April 2013 General Meeting of Shareholders

>> Major shareholders

Pursuant to the Netherlands Financial Supervision Act,

Kendrion is aware, on the basis of the information in the

registers of the Netherlands Authority for the Financial

Markets (AFM), that the following shareholders possessed

an interest of more than 5% on 31 December 2011:

Shareholder Date of report

Parcom Capital (ING) 15.07% 1-10-2010

Menor Investments B.V. 7.92% 7-1-2009

Delta Lloyd N.V. 9.49% 6-5-2011

Darlin N.V. 5.09% 1-11-2006

Janivo Beleggingen B.V. 5.88% 4-10-2011

Jan Plas S.A. 5.02% 2-4-2009

J.N.A. van Caldenborgh 5.00% 4-3-2010

Total 53.47%

Movements in the share price from

3 January 2011 to 31 January 2012

Kendrion N.V. share AEX


annual magazine 2011

On 22 April 2011, Dr T. Tettamanti disclosed that its

indirect interest in Kendrion had fallen to 4.99% as from

21 April 2011. Other movements in the size of the interests

of Kendrion’s major shareholders also took place during

the course of 2011. These changes fall within the

disclosure thresholds as stipulated in the Financial

Supervision Act and, consequently, do not need to be

disclosed by the major shareholders. On 8 February 2012

Delta Lloyd Deelnemingen Fonds N.V. disclosed that it has

acquired a 5.10% interest in Kendrion.

60 Index






>> 3 January 2011

>> 31 January 2012

>> 41

Bottomline Financial performance (continued)

Consolidated statement of fi nancial position

at 31 December

EUR million 2011 2010

>> Assets

Non-current assets

Property, plant and equipment 55.2 46.5

Intangible assets 76.0 50.1

Other investments, including derivatives 0.5 0.0

Deferred tax assets 9.3 12.8

Total non-current assets 141.0 109.4

Current assets

Inventories 38.5 28.2

Current tax assets 1.0 0.3

Trade and other receivables 39.6 30.2

Cash and cash equivalents 9.2 9.0

Total current assets 88.3 67.7

Total assets 229.3 177.1

>> Equity and liabilities


Share capital 22.9 22.6

Share premium 64.6 68.4

Reserves 24.1 6.8

Retained earnings (20.2) 16.5

Total equity attributable to equity holders of the company 91.4 114.3

Minority interest 0.3 0.2

Total equity 91.7 114.5


Loans and borrowings 23.3 2.5

Employee benefi ts 6.5 7.0

Government grants received in advance 0.1 0.3

Provisions 46.4 2.7

Deferred tax liabilities 6.2 3.4

Total non-current liabilities 82.5 15.9

Bank overdraft 0.3 1.7

Loans and borrowings 11.5 10.0

Current tax liabilities 1.2 2.0

Trade and other payables 42.1 33.0

Total current liabilities 55.1 46.7

Total liabilities 137.6 62.6

Total equity and liabilities 229.3 177.1

>> 42 annual magazine 2011

Consolidated statement of comprehensive income

EUR million 2011

annual magazine 2011

EC fi ne

and a.o.




Incidental tax

(normalised) 2010 benefi t



Revenue 267.9 – 267.9 221.9 – 221.9

Other operating income 1.0 – 1.0 0.8 – 0.8

Total revenue and other operating income 268.9 – 268.9 222.7 – 222.7

Changes in inventories of fi nished goods and work in progress (4.2) – (4.2) (2.4) – (2.4)

Raw materials and subcontracted work 139.1 – 139.1 110.7 – 110.7

Staff costs 72.8 – 72.8 62.0 – 62.0

Depreciation and amortisation 10.8 – 10.8 10.1 – 10.1

Other operating expenses 61.9 40.7 21.2 19.5 – 19.5

Results before net finance costs (11.5) (40.7) 29.2 22.8 – 22.8

Finance income 0.1 – 0.1 0.4 – 0.4

Finance expense (2.1) – (2.1) (3.4) – (3.4)

Net finance costs (2.0) – (2.0) (3.0) – (3.0)

Profit before income tax (13.5) (40.7) 27.2 19.8 – 19.8

Income tax expense (6.6) 0.1 (6.7) (3.2) 1.8 (5.0)

Profit for the period (20.1) (40.6) 20.5 16.6 1.8 14.8

Attributable to:

Equity holders of the company (20.2) (40.6) 20.4 16.5 1.8 16.5

Minority interest 0.1 – 0.1 0.1 – 0.1

Profit for the period (20.1) (40.6) 20.5 16.6 1.8 14.8

Other comprehensive income

Foreign currency translation differences for foreign operations 0.7 – 0.7 1.1 – 1.1

Net change in fair value of cash fl ow hedges, net of income tax (0.2) – (0.2) 0.9 – 0.9

Other comprehensive income for the period, net of income tax 0.5 – 0.5 2.0 – 2.0

Total comprehensive income for the period (19.6) (40.6) 21.0 18.6 1.8 16.8

Total comprehensive income attributable to:

Equity holders of the company (19.7) (40.6) 20.9 18.5 1.8 16.7

Minority interest 0.1 – 0.1 0.1 – 0.1

Total comprehensive income for the period (19.6) (40.6) 21.0 18.6 1.8 16.8

Basic earnings per share (EUR) (1.79) (3.58) 1.79 1.47 0.17 1.30

Diluted earnings per share (EUR) (1.79) (3.58) 1.79 1.47 0.17 1.30

This consolidated statement of comprehensive income with normalisation is not included in

the 2011 Annual Report of Kendrion N.V. The normalisation is unaudited.

>> 43

>> 44

Bottomline Financial performance (continued)

Two-year summary

EUR million, unless otherwise stated 2011 2010

>> Kendrion N.V. consolidated

Normalised statement of comprehensive income

Revenue 267.9 221.9

Organic growth 20.7% 42.9%

Normalised operating result (EBIT) 29.2 22.8

Normalised operating result before amortisation (EBITA) 1 30.7 24.2

Depreciation and amortisation 10.8 10.1

Normalised operating result before depreciation and amortisation (EBITDA) 40.0 32.9

Normalised profi t for the period 20.5 14.8

Statement of financial position at 31 December conform financial statements

Total assets 229.3 177.1

Total equity 91.7 114.5

Net interest-bearing debt 25.9 5.2

Working capital 2, 4 35.8 26.0

Invested capital 3, 4 176.7 129.3

Cash flow conform financial statements

Net cash from operating activities 27.6 25.6

Net investments 13.5 8.9

Free cash fl ow 6 14.6 17.4

Ratios – pro forma

Solvency 40.0% 64.7%

Net interest-bearing debt / EBITDA 3, 5 (debt cover) 0.6 0.2

Net interest-bearing debt / equity (gearing) 0.3 0.1

EBITA 1 / net fi nance costs (interest cover) 5 12.1 8.1

Working capital 2, 4, 5 in % of revenue 12.1% 11.7%

Market capitalisation as at 31 December 189.6 164.1

Net interest-bearing debt as at 31 December 25.9 5.2

Theoretic value of the organisation (Enterprise value) 5 215.5 169.3

Number of employees at 31 December (fte) 4 1,534 1,218

1 EBITA excluding amortisation related to acquisitions.

2 Relates to inventories, receivables minus non interest bearing debts.


Total invested capital is property, plant and equipment, intangible assets

and current assets less the current tax liabilities, trade payables and other



2011 including FAS Controls, Inc.


Pro forma. Unaudited.


Before cash fl ow acquisitions and disposals (2011 and excluding acquisition


annual magazine 2011





>> Facts & fi gures

CSR Board installed

and ambition statement established

CSR targets defi ned

operating companies ISO 14001 certifi ed for environmental


More than 50 sponsoring activities to strengthen local communities in which

Kendrion operates. Social Engagement Award granted by the department of economic

affairs of Baden-Württemberg, Germany

Kendrion joined the UN Global Compact in 2009


CO 2 reduction in 2012 and 10% in 2013 per million turnover for

biggest German production plants

fraud reports in 2011. Supplier Code of Conduct

to be introduced step by step



CSR Report to be published on Kendrion’s

website early April 2012




annual magazine 2011





employees in 8 European countries and Brazil, China,

India, Mexico and the USA

450 women and 718 men in permanent employment

Average age of employees 40.4 years

Average of 9.4 service years

of employees are offered mineral water, fruit and infl uenza

vaccination for free

Training costs 0.7% of wage costs


Low average absenteeism rate 2.9%






Electricity and magnetism both

play a part in this spectacularly

beautiful natural phenomenon.

Aurora borealis is caused by

solar wind, electrically charged

particles ejected from the sun.

On reaching the earth, the

particles collide with oxygen

atoms and nitrogen molecules

in the earth’s atmosphere,

causing them to glow in blurred

patterns of green, purple,

yellow and blue, just as the

electricity in a fl uorescent lamp

makes the gas glow inside.

Auroras are especially visible in

the polar region, as in other

latitudes the earth’s magnetic

fi eld defl ects the particles.

Aurora borealis is named after

the Roman goddess of the

dawn, Aurora, and the Greek

god of the north wind, Boreas.

Kendrion N.V.

Utrechtseweg 33

3704 HA Zeist

P.O. Box 931

3700 AX Zeist

The Netherlands

Telephone +31 (0)30 699 72 50

Fax +31 (0)30 695 11 65

E-mail info@kendrion.com


Registered in Zeist, the Netherlands

More magazines by this user
Similar magazines