Annual Report - SIG Combibloc

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30 SIG Pack SIG Pack: reaching out to new frontiers SIG Pack is a world leader in the supply of packaging systems and machines for dry goods. Disregarding fiercely contested market conditions, the division succeeded in maintaining its leadership position in the food sector and even to continue expansion in the health care and pharmaceuticals segments. Strict implementation of the innovative service model is reaping rewards and has sustainably improved customer relations. Despite a sharp reduction in net sales, particularly in the systems business, SIG Pack achieved a positive operating profit (ebit). A weak market for capital goods characterized the course of business for SIG Pack over the entire year under review. Towards the end of the year, first positive signals were discernible on the market side. After an extended planning phase, a number of major projects were finally ordered. Unfortunately, some of this positive development will be offset in the vital us market as a result of the weak dollar. Those projects that were ultimately booked were marked by intense pressure on prices and insistence on short delivery times. Consequently, the technical and commercial risk levels increased. Our customers continue to give high priority to projects that promise short payback periods. Compared to the previous year, demand for packaging systems weakened significantly in the region of North America. By contrast, in the European market a number of major projects were won. In Asia, SIG Pack continues to focus on global key accounts. With its local presence in Brazil, the division is well positioned in Latin and in South America. Packaging systems: major projects postponed SIG Pack Systems in Beringen, Switzerland, lacked orders for major integrated systems in the past year. This led to a severe decline in net sales. Traditional key accounts in North America and the United Kingdom concentrated their efforts on optimizing existing equipment. The new product platforms in the sectors of robotics and secondary packaging, which were launched on a broad front in the past year, generated substantial launch costs. Through adapted capacities and improved processes in the area of project and risk management, the new management team responded rapidly to prevailing market conditions in the food segment. In the market segments health care and pharmaceuticals, demand continued to remain stable. Standard machines: strong market position Activities in the business unit Standard Machines focus primarily on North America (SIG Doboy) and Western Europe (SIG Demaurex and SIG Transver). The new robotics product family was well received by the market. In addition to a competitive product portfolio, this business unit now possesses stable processes and a lean, flexible structure. Services: operational excellence and improved profitability In the year under report, another Group company, SIG Sapal, and an external partner, Rotzinger, were successfully integrated into the service organization for the first time. The open systems platform service works permits rapid migration of data and processes. Consequently, SIG Pack has progressed a further step towards being a supplier providing integrated services for packaging technology. Outlook Despite growing optimism towards the end of 2003, the global uncertainties will continue into 2004 and have a dampening effect on our customers’ willingness to invest. Expansion in the health care and pharmaceuticals sectors continues to have high priority. In 2004, SIG Pack will continue to rigorously adapt its capacities to match demand levels and focus its resources on core business.
The improvement in operating profit (ebit) expected for 2004 stems primarily from the turnaround in the business sector packaging systems and steady growth in the field of customer services. “Others”: turnaround achieved Mid-2003, the business units SIG Kautex, SIG Blowtec and SIG Hamba Filltec were brought together to form the business unit “Others.” At the end of the business year, SIG Elettric 80 was integrated into this unit as well. The companies in the business unit “Others” are not part of the core business of SIG. In recent years, some of them have had a markedly negative impact on the net profit of the Group. The new organizational structure ensures that management can monitor the initiatives and that the initiated measures outside the core business are implemented fully. It is a stated objective of SIG to divest these activities. SIG Kautex: concentration generates initial positive results SIG Kautex is the leading supplier of extrusion blow-molding equipment for fuel tanks and 3-D-molding machines for the automotive industry. Whereas the us market remains extremely cautious, Europe and Asia are showing the first signs of recovery. The strong local commitment of SIG Kautex in China, with its own representative office in Shanghai, has proven successful. As a result of restructuring, the operating profit (ebit) suffered significantly. Necessary measures were completed in the course of 2003. Considering the amended cost structure and the good order backlog at the end of 2003, a positive result may be expected for 2004. SIG Blowtec: restructuring and product range streamlining completed The world market for extrusion blow-molding machines deteriorated further in 2003. This situation led to severe price erosion. Markets in North America, Europe and Asia suffered from a difficult, overall economic situation and existing overcapacities. Individual markets such as Mexico and Russia, however, exhibited positive developments. SIG Blowtec adapted its capacities to match the changed market conditions. The product range was streamlined and production made leaner. These corrective actions had a distinctly negative impact on the results of the business unit. By the end of 2003, the required restructuring was completed. Despite the continuing difficult market conditions in 2004, we expect a balanced result for the business year. SIG Hamba Filltec: extensive adjustments For SIG Hamba Filltec, 2003 was a year of comprehensive restructuring. The product range was brought in line with the findings of a detailed market analysis, costs were cut and the number of employees reduced. These extensive corrective measures are taking hold and showing first positive results. Others 31
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Page 17 and 18: Letter from the Chairman 17 Recover
Page 19 and 20: Net sales in millions of eur 2001 1
Page 21 and 22: Employees 2001 9,182 2002 9,402 200
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Page 25 and 26: that the uncertainties of the situa
Page 27 and 28: Operating profit (ebit) in millions
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Page 37 and 38: Martin Huber P. Eng. eth, ll. b., S
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Page 45 and 46: Roman Boutellier President and ceo
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Page 56 and 57: 56 Highlights 2003 June May April M
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Page 60 and 61: 60 Addresses Argentina SIG Combiblo

Annual Report - SIG Combibloc

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