We make our customers successful. - Oerlikon Barmag

Asian markets in particular, led by China, but also Turkey, performed strongly and exceeded our expectations
with a high demand for technologically advanced products. By contrast the demand in Europe
and America remained stagnant, apart from a few exceptions.
In natural fibers Saurer achieved an order intake in 2003 of EUR 636m (EUR 854m, –26%) and sales of
EUR 733m (EUR 774m, –5%). With the slackening of demand in the second half of 2003, utilization of
production capacity in the first half of 2004 will be well down from the high levels of last year. However,
thanks to their high flexibility and cost discipline, our business units in the natural fiber sector are able
to absorb the effects of these short cycles with swings of up to 30% of capacity utilization from one
quarter to the next.
Order intake for synthetic fiber plants was EUR 596m, 33% above the low level of the previous year,
leading to a high order book at the end of the year. Sales were also up, by 24% to EUR 543m (prior year
EUR 437m).
These volume increases and the improved cost base brought the synthetic fiber plant business back into
profit, with all business units in the sector showing positive results. Neumag, manufacturing machines
for production of carpet yarn and synthetic staple fiber, pursued its positive trend of recent years, not
only in respect of orders and sales, but also in its profit margins. Barmag’s texturizing machinery also
profited from a strong market revival. Increased sales, in combination with significant cost reductions
following relocation of production to China and the Czech Republic, enabled this division to return a
satisfactory result again after four years of losses. Barmag’s filament spinning machine business, which
is under extreme price pressure from Japan with highly unfavorable foreign exchange rates (Euro/
Yen/Dollar), and also from local competitors in China, managed a notable improvement in 2003 without
achieving a break-even result yet.
Despite the improved market conditions, our structural improvements in the textile business are being
pursued intensively. The outsourcing programs are essentially concluded. The last major parts manufacturer
in Germany, Schlafhorst Parsys, was closed at the end of August, its business to a great extent
passed on to third parties. Our sales, service and production facilities in Asia are developing rapidly.
Our Tempus program, started 15 months ago, aims to re-engineer business processes radically throughout
the Group, realigning everything we do to achieve customer satisfaction with maximum efficiency.
These measures have been defined for all business units and will be implemented largely in 2004. The
legal structure in Germany has been streamlined, with the previously separate textile division companies
now merged into one company with several branches; this will simplify administration and reduce taxes.
The end product of Tempus will be a new company culture, increased customer benefit and reduction of
fixed costs by EUR 35m in 2005. Most of the cost of this program has been accrued in 2003.
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