Annual Report - SIG Combibloc

Employees
2001 9,182
2002
9,402
2003
9,014
Remaining activities
Activities
to be divested
The total number of employees at SIG fell in 2003 from 9,402 to 9,014 as a result of
divestments and rationalization measures. Manpower adjustments in the SIG Pack and
SIG Beverages divisions as well as in the three business units SIG Kautex, SIG Blowtec
and SIG Hamba Filltec were offset partially by the creation of new jobs at SIG Combibloc.
Thanks to strong demand for beverage cartons of SIG Combibloc, our core business grew
significantly in 2003. Order intake of the two divisions SIG Combibloc and SIG Beverages
totaled eur 1,506 millions (2002: eur 1,457 millions) and net sales stood at eur 1,544 millions
(2002: eur 1,443 millions). At eur 120 millions, the ebit of the core business fell short of
the previous year’s figure of eur 139 millions. This result stems primarily from major market
penetration investments (newly installed fillers), higher research and development
expenditure, plus the negative development of the US dollar. Since the year 2000,
SIG Combibloc has developed positively and, in the previous business year already, outperformed
our forecasts. In the past seven years, SIG Combibloc has doubled its net sales,
whereas the profit was doubled in only three. This positive trend continued in 2003.
The division increased its net sales to eur 1,058 millions (2002: eur 939 millions) and,
with an operating profit (ebit) of eur 137 millions, even surpassed the excellent results
of the previous year (eur 132 millions). High capacity usage at the production plants
and filling machines, as well as further reduction of waste rates at the packaging material
plants all contributed. Generating around one third of all sales, the German domestic
market is the most important one for SIG Combibloc. Within the European Union, the
markets of Spain and France also developed positively. Continuing growth trends in the
markets of Eastern Europe and the Middle East are also gratifying.
SIG Beverages is dedicated entirely to the machine and systems business. As a result,
this division suffered heavily from the effects of a reluctant economic environment. Net sales,
order intake and operating profit (ebit) totaled eur 486 millions, eur 455 millions and
eur –17 millions respectively, falling short of the previous year’s figures of (eur 504 millions,
eur 503 millions and eur 7 millions). However, in the final quarter of 2003, order intake
picked up substantially. Consequently, we can start the new business year in a more favorable
position and with a stronger order backlog than originally anticipated at mid-year. Step
by step, our management is working on improvement projects that will bring us closer to our
target of operational excellence. SIG Simonazzi has already achieved one vital intermediate
objective: the unit succeeded in significantly lowering the cost and duration of commissioning
beverage lines at customers’ facilities. We are strengthening cooperation between the key
units SIG Simonazzi (filling machines), SIG Alfa (labeling machines) and SIG Corpoplast
(blow-molding machines). SIG Asbofill, our new business unit for linear aseptic filling of pet
and hdpe bottles, is being integrated as an important element into the SIG Beverages
division. SIG Corpoplast and SIG Simonazzi are cooperating closely in several markets: in
the past twelve months, SIG Manzini has already completed several projects in collaboration
with SIG Combibloc.
Despite an uninspiring economic climate, SIG Pack achieved satisfactory results. Net
sales and order intake suffered from increasingly strong competition. The higher ebit
of eur 8 millions compared to the previous year (eur 4 millions) stems from the profit of
eur 8 millions realized from the sale of a property. As already indicated in the previous
year, the market continued to shrink in 2003. Although the management had made timely
capacity adjustments, SIG Pack could not reach the operating profit of the previous year.
As expected, the seasonal nature of the business helped the division to compensate the
operating loss of the first half. Together with Bosch, Cavanna and Schubert, SIG Pack ranks
among the leading providers of machinery for dry goods.
Group report
21