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<strong>Annual</strong> <strong>Report</strong> <strong>2010</strong><br />
<strong>Annual</strong> <strong>Report</strong> <strong>2010</strong><br />
Management Organization of the <strong>Melitta</strong> Group<br />
<strong>Melitta</strong><br />
Household<br />
Products<br />
Europe<br />
Jan Van Riet<br />
(as of January 1, 2011)<br />
Corporate Division<br />
Corporate Development<br />
Jero Bentz<br />
(as of April 8, <strong>2010</strong>)<br />
Cofresco<br />
Freshkeeping<br />
Products<br />
Europe<br />
Dirk Löhmer<br />
<strong>Melitta</strong><br />
Brasil<br />
Bernardo Wolfson<br />
Corporate Management<br />
Dr. Thomas Bentz<br />
Dr. Stephan Bentz<br />
Volker Stühmeier (as of March 1, 2011)<br />
<strong>Melitta</strong><br />
Coffee<br />
Europe<br />
Dr. Frank Strege<br />
(as of November 8, <strong>2010</strong>)<br />
Corporate Division<br />
Finance<br />
Kurt Groh<br />
<strong>Melitta</strong><br />
USA<br />
Marty Miller<br />
<strong>Melitta</strong><br />
SystemService<br />
Harald Johanning-<br />
Meiners<br />
(as of February 17, <strong>2010</strong>)<br />
<strong>Melitta</strong><br />
Canada<br />
William J. Ivany<br />
Corporate Division<br />
Legal Affairs & HR<br />
Wolf PVG<br />
Dr. Lutwin Spix<br />
Markus Zeyen<br />
Neu Kaliss<br />
Spezialpapier<br />
John Paul Fender<br />
Dieter Kirchner
<strong>Melitta</strong> Group <strong>2010</strong><br />
Key Figures <strong>2010</strong><br />
Share<br />
of sales Sales Total sales 1<br />
Capital<br />
expenditure Employees<br />
in percent in € ’000 in € ’000 in € ’000 Average<br />
<strong>Melitta</strong> Household Products Europe 28 365,624 519,203 3,625 1,475<br />
Cofresco Freshkeeping Products Europe2 3 40,805 178,695 5,330 290<br />
<strong>Melitta</strong> Coffee Europe 25 331,438 337,961 624 171<br />
<strong>Melitta</strong> SystemService 10 131,938 167,296 1,712 708<br />
<strong>Melitta</strong> Brasil 22 292,489 312,693 5,254 585<br />
<strong>Melitta</strong> USA 4 56,684 81,044 4,665 120<br />
<strong>Melitta</strong> Canada 2 23,953 23,953 94 10<br />
Wolf PVG 2 19,949 52,765 3,840 242<br />
Neu Kaliss Spezialpapier 3 35,913 37,746 1,289 129<br />
ACW 0 2,544 2,657 194 12<br />
Shareholdings 0 65 20,262 1,069 70<br />
<strong>Melitta</strong> Group total 1,301,402 1,734,275 27,696 3,812<br />
1 incl. intercompany sales<br />
2 excl. sales to trade in Germany<br />
Regional Development <strong>2010</strong><br />
Germany<br />
Europe<br />
(excl. Germany)<br />
North America<br />
South America<br />
Sales by Region in € ’000<br />
<strong>2010</strong><br />
532,502<br />
2009 537,025<br />
<strong>2010</strong><br />
398,331<br />
2009 366,468<br />
<strong>2010</strong><br />
93,727<br />
2009 91,701<br />
<strong>2010</strong><br />
226,481<br />
2009 174,064<br />
Employees by Region<br />
<strong>2010</strong><br />
2009<br />
1,754<br />
1,758<br />
<strong>2010</strong><br />
673<br />
2009 712<br />
<strong>2010</strong><br />
231<br />
2009 226<br />
<strong>2010</strong><br />
585<br />
2009 544<br />
Asia <strong>2010</strong><br />
50,361 <strong>2010</strong><br />
569<br />
2009 33,088<br />
2009 316<br />
Sales by Product Groups <strong>2010</strong><br />
42%<br />
Coffee Enjoyment „Coffee“<br />
13%<br />
Coffee Enjoyment „Filter paper“<br />
8%<br />
Coffee Enjoyment „Coffeemakers“<br />
General Partners of the<br />
<strong>Melitta</strong> Unternehmensgruppe<br />
Bentz KG<br />
Jörg Bentz<br />
Dr. Thomas Bentz<br />
Dr. Stephan Bentz<br />
Managing Partners<br />
Dr. Thomas Bentz<br />
Dr. Stephan Bentz<br />
Limited Partners<br />
Jero Bentz<br />
Claudia Bertelmann-Tauß<br />
Jara Bentz<br />
Thomas Dominik Bentz<br />
Advisory Council<br />
Michael Gallenkamp (Osnabrück), Chairman<br />
Claus Holst-Gydesen (Neuss)<br />
Dr. Uwe Tillmann (Düsseldorf)<br />
Jörg Bentz<br />
Dr. Thomas Bentz<br />
Dr. Stephan Bentz<br />
13%<br />
Freshness and Flavour<br />
6%<br />
Convenient Cleaning<br />
5%<br />
Industrial Paper<br />
13%<br />
Others
Contents<br />
2 Foreword of the Management<br />
4 Locations<br />
6 Employer attractiveness<br />
Business Units<br />
10 <strong>Melitta</strong> Household Products Europe<br />
14 Cofresco Freshkeeping Products Europe<br />
18 <strong>Melitta</strong> Coffee Europe<br />
22 <strong>Melitta</strong> SystemService<br />
26 <strong>Melitta</strong> Brasil<br />
30 <strong>Melitta</strong> USA<br />
34 <strong>Melitta</strong> Canada<br />
38 Wolf PVG<br />
42 Neu Kaliss Spezialpapier<br />
Financial Information<br />
46 Group Management <strong>Report</strong><br />
50 Consolidated Balance Sheet<br />
51 Explanatory Notes on the<br />
Consolidated Balance Sheet<br />
56 Imprint
2 <strong>Melitta</strong> <strong>Melitta</strong>Unternehmensgruppe Group <strong>Annual</strong> <strong>Report</strong> Geschäftsbericht <strong>2010</strong> 2008<br />
Ladies and gentlemen!<br />
from left to right<br />
Dr. Thomas Bentz<br />
Dr. Stephan Bentz<br />
General Partners of the<br />
<strong>Melitta</strong> Group<br />
The <strong>Melitta</strong> Group can once again look back on a successful business year in <strong>2010</strong>: there<br />
was strong growth in our global coffee business as well as in sales to customers in the<br />
food service sector. Our consumer goods business remained largely stable – even though<br />
we continued to suffer from subdued demand and ongoing price competition in certain<br />
product categories. Following a weaker preceding year, our business with industrial<br />
clients recovered strongly in <strong>2010</strong>. And Brazil once again turned in a strong performance<br />
with high growth rates.<br />
All in all, we are satisfied with the course of business in the past year: with rising sales<br />
volumes, we succeeded in raising revenue by eight percent. Earnings developed in line<br />
with expectations at the prior-year level.<br />
In <strong>2010</strong>, we once again invested in strengthening our competitive edge. These investments<br />
included an amount of € 28 million for the modernization and expansion of our<br />
production capacities, for example in the USA and Brazil. Net bank borrowing increased<br />
slightly in line with planning. At the same time, there was strong growth in equity<br />
capital. As a result, we still boast a very healthy balance sheet. This provides us with a<br />
solid foundation for our plans in the coming years.<br />
In order to smooth the path for continued growth, we decided to make further investments<br />
in <strong>2010</strong>: the encouraging development of our specialist paper business, for<br />
example, motivated us to modernize our paper plant in Berlin in the current year and to<br />
integrate it into a separate company, Neukölln Spezialpapier NK GmbH & Co. KG, a<br />
co-subsidiary of Neu Kaliss Spezialpapier GmbH. Moreover, we continued to drive our<br />
geographic expansion, for example by preparing our entry into the Russian food wrap<br />
market with the foundation of a local subsidiary.<br />
We believe the consumer food wrap business offers sustainable and attractive market<br />
potential. The acquisition of ACW-Film GmbH & Co. KG represents a new business<br />
venture which we intend to gradually develop. ACW develops, produces and supplies<br />
packaging film for reputable companies in the consumer goods industry and will add a<br />
further segment to our industrial business.
The past months have also seen a number of changes in our senior management: we<br />
are delighted to have been able to recruit two internationally acclaimed executives in<br />
Dr. Frank Strege (CEO of <strong>Melitta</strong> Coffee Europe) and Jan Van Riet (CEO of <strong>Melitta</strong><br />
Household Products Europe). They will utilize their extensive experience to steadily<br />
develop their respective operating divisions in line with the targets set.<br />
We are also delighted to report that Volker Stühmeier became the first non-family<br />
member of the Group’s Chief Corporate Management in March 2011. The shareholders<br />
and Advisory Council of the <strong>Melitta</strong> Group have thus established the necessary conditions<br />
to safeguard continuity in our top management and to lead our family business<br />
into a successful future.<br />
Irrespective of these personnel changes, our everyday company life continues to be<br />
dominated by such core values as consistency, responsibility and trust. We fill these<br />
values with life in both our dealings within the company as well as in our actions outside<br />
it. For consumers and customers, these values are expressed through our reliable<br />
brand promise with consistently high product quality. We are also committed to playing<br />
an active role in our local communities and support numerous social and cultural<br />
initiatives. Every single employee of our Group takes responsibility and makes an important<br />
contribution to the company’s successful future development.<br />
In order to remain successful in future, we will continue to apply our successful formula:<br />
a healthy mixture of traditional, down-to-earth pragmatism and a desire for<br />
change. Step for step, we have turned a company with a few core products into a group<br />
of companies with a variety of product ranges in clearly defined strategic business fields<br />
represented around the world by its sites in Europe, the Americas and Asia. As a classic<br />
branded product manufacturer we always take the long-term view. With our strong<br />
portfolio of brands, we will continue to occupy strong positions in our markets and<br />
target further growth. Against this backdrop, we aim to be fast, efficient and innovative<br />
once again in 2011 in order to enhance our market standing.<br />
<strong>Melitta</strong> got off to a successful start in 2011 and we expect this development to continue<br />
throughout the year. The economic recovery in Europe is expected to breathe life into<br />
consumer spending. The same applies to our industrial and food service businesses. We<br />
therefore expect to successfully place our products in their respective markets. In addition<br />
to the positive trend in Europe, we see particularly attractive prospects for business<br />
in our non-European regions. In total, we forecast growth in sales of five percent for the<br />
current fiscal year. After having started to raise capital expenditures slightly in the past<br />
year, we will invest more strongly in the quality of our products and in our production<br />
capacities once again in 2011.<br />
We would like to express our gratitude in particular to all employees, who once again<br />
displayed tremendous dedication in <strong>2010</strong>. We also thank our customers and partners for<br />
the trust they placed in us. Together with you, we look forward to a successful 2011.<br />
Minden, April 2011<br />
Foreword of the Management<br />
Dr. Thomas Bentz Dr. Stephan Bentz<br />
3
4 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Report</strong> <strong>2010</strong><br />
Standorte weltweit<br />
Locations<br />
USA<br />
Canada<br />
Brazil<br />
<strong>Melitta</strong> Companies <strong>Melitta</strong> Companies with facility<br />
Spain<br />
France<br />
Belgium<br />
Netherlands<br />
Switzerland<br />
Denmark<br />
Germany<br />
Sweden<br />
Austria<br />
Italy<br />
Czech Republic<br />
Poland<br />
Russia
China<br />
Japan<br />
EUROPE<br />
Belgium<br />
Lokeren<br />
<strong>Melitta</strong> België N.V.<br />
Overpelt<br />
Airflo Europe N.V.<br />
Denmark<br />
Roskilde<br />
<strong>Melitta</strong> Scandinavia A/S<br />
Germany<br />
Minden<br />
<strong>Melitta</strong> Unternehmensgruppe Bentz KG<br />
<strong>Melitta</strong> Bentz GmbH & Co. KG<br />
Bentz Beteiligungs GmbH & Co. KG<br />
<strong>Melitta</strong> Beratungs- und Verwaltungs<br />
GmbH & Co. KG<br />
<strong>Melitta</strong> Haushaltsprodukte<br />
GmbH & Co. KG<br />
Cofresco Frischhalteprodukte<br />
GmbH & Co. KG<br />
<strong>Melitta</strong> SystemService GmbH & Co. KG<br />
is4 IT Services for Consumer Products &<br />
IT-Providers GmbH & Co. KG (share 49 %)<br />
Bremen<br />
<strong>Melitta</strong> Kaffee GmbH<br />
Berlin<br />
Neukölln Spezialpapier NK<br />
GmbH & Co. KG<br />
Vlotho / Spenge<br />
Wolf PVG GmbH & Co. KG<br />
Neu Kaliß<br />
Neu Kaliss Spezialpapier GmbH<br />
Stollberg-Breinig<br />
esw electronic service willms<br />
GmbH & Co. KG (share 30 %)<br />
Rhede<br />
ACW-Film GmbH & Co. KG<br />
Webo GmbH & Co. KG<br />
France<br />
Saint Tibault des Vignes<br />
<strong>Melitta</strong> SystemService France S.A.S.<br />
Paris<br />
Cofresco S.A.S.<br />
<strong>Melitta</strong> France S.A.S.<br />
Chézy<br />
<strong>Melitta</strong> France S.A.S.<br />
Tourcoing<br />
Codiac S.A.S.<br />
Netherlands<br />
Hardinxveld-Giessendam<br />
<strong>Melitta</strong> SystemService Benelux B.V.<br />
Gorinchem<br />
<strong>Melitta</strong> Nederland B.V.<br />
Austria<br />
Salzburg<br />
<strong>Melitta</strong> Ges.mbH<br />
<strong>Melitta</strong> SystemService International<br />
GmbH, Subsidiary Austria<br />
Poland<br />
Brodnica<br />
Cofresco Polska Sp. z o.o<br />
Russia<br />
St. Petersburg<br />
<strong>Melitta</strong> Russland AG<br />
Cofresco RussCom OOO<br />
Sweden<br />
Helsingborg<br />
<strong>Melitta</strong> Scandinavia AB<br />
Switzerland<br />
Egerkingen<br />
<strong>Melitta</strong> GmbH<br />
Hunzenschwil<br />
Cafina AG<br />
Italy<br />
Volpiano<br />
Cuki Cofresco S.p.A. (share 18 %)<br />
Spain<br />
Alcobendas / Madrid<br />
Cofresco Iberica S.A.<br />
Czech Republic<br />
Prague<br />
<strong>Melitta</strong> ČR s.r.o.<br />
NORTH AMERICA<br />
USA<br />
Clearwater<br />
<strong>Melitta</strong> USA Inc.<br />
Cherry Hill<br />
European Coffee Classics Inc.<br />
Elgin<br />
<strong>Melitta</strong> SystemService USA Inc.<br />
Canada<br />
Vaughan, Ontario<br />
<strong>Melitta</strong> Canada Inc.<br />
SOUTH AMERICA<br />
Brazil<br />
São Paulo / Avaré / Bom Jesus<br />
<strong>Melitta</strong> do Brasil Industria<br />
e Comércio Ltda.<br />
Guaiba<br />
Celupa – Indústrial Celulose e Papel<br />
Guaiba Ltda.<br />
ASIA<br />
China<br />
Hong Kong<br />
<strong>Melitta</strong> Pacific Ltd.<br />
Shenzhen<br />
Shenzhen <strong>Melitta</strong> Household Products Ltd.<br />
Japan<br />
Tokyo<br />
<strong>Melitta</strong> Japan Ltd.<br />
Locations<br />
5
6 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Report</strong> <strong>2010</strong><br />
Employer attractiveness<br />
Prof. Dr. Armin Trost<br />
As skilled employees become increasingly rare, it is not only job candidates who must<br />
talk up their suitability but also the employers themselves. And that not only applies to<br />
recruiting talented and motivated staff but also to retaining good people in the company.<br />
As easy as this may appear at first sight, the answer to what companies might do<br />
in view of this shift in power is actually quite complex.<br />
Staff surveys are nothing new. Many companies regularly question their work force<br />
on their feelings toward the company, with reference to all aspects of job satisfaction.<br />
There have to be serious doubts, however, as to whether such measures actually<br />
enhance the employer’s appeal in most cases. Instead of using such a scattergun<br />
approach to the question of their attractiveness to staff, employers should take a more<br />
strategic view of the situation.<br />
Does an employer have to be equally appealing to everyone – in all departments, divisions<br />
and locations, whether existing staff or potential candidates? This may seem a<br />
worthy and well-meaning objective, but it’s not exactly realistic. Do companies today<br />
and in future have to pay competitive wages, offer international career prospects or<br />
promise a healthy work-life balance? Once again, the answer is a definite “maybe”. So<br />
what now?<br />
Let us first approach the question of whether an employer has to be attractive. Every<br />
company has functional areas of particular strategic importance, often referred to as<br />
“key functions”. If a company has set itself the strategic target of becoming the cost<br />
leader, for example, then Purchasing or Production Planning are usually key functions.<br />
However, if the company has targeted leadership in technology and innovation,<br />
then Research and Development will be a key function. A company would therefore<br />
be well advised to employ staff in these key functions who are better than those of<br />
its competitors in comparable functions. It is often difficult to find staff for such<br />
key functions. This is why a company needs to be attractive to existing and potential<br />
employees primarily in these positions if it wants to have the best staff. For the<br />
remaining positions, the question is: how attractive or unattractive can a company<br />
afford to be, or even want to be.<br />
A product is not equally attractive to all market participants. It doesn’t have to be.<br />
Most cars are too expensive, too fast, too slow, too big or too small for most motorists.<br />
That is perfectly normal and does not cause car manufacturers any sleepless nights.<br />
The important thing is that certain cars appeal to certain target groups which the<br />
company wants to reach. Companies should therefore think and act in a similar way<br />
when it comes to employer attractiveness. It’s perfectly acceptable if the Purchasing<br />
department does not attract German literature graduates, for example. But if you want<br />
to recruit top business graduates for a position in Purchasing, then it would certainly
e beneficial if the respective target group were made aware of this function in an<br />
appealing way. An important question is therefore: who do I want to reach on the job<br />
market? What type of people belong to my relevant target group for this key function?<br />
Are they pupils, students, graduates of certain courses? Experienced workers with a<br />
specific industry background?<br />
In order to appeal to a certain target group, you first have to understand them. You<br />
have to find out their employer preferences and which professional aspects they attach<br />
most importance to. Such things are not always possible to discover from surveys or<br />
similar standard instruments. Instead, the employer should systematically approach<br />
the chosen species with a combination of openness and curiosity. The similarity to<br />
ethnology is no coincidence. It is often quite surprising to discover what ultimately<br />
drives the target candidates. To some extent it is therefore advisable to depart from<br />
conventional attitudes – especially when it comes to members of the younger generation,<br />
the so-called Generation Y. This is a generation for whom the daily and everpresent,<br />
mobile use of the Internet and social media is absolutely normal. They<br />
demand space in their daily work. Work is no longer viewed as a place you go to, but<br />
as something you do – whenever, wherever and with whomever. Work means having<br />
an uncomplicated approach to communication and cooperation. Hierarchies and<br />
formal or informal networks are no longer seen as contradictions. Private and professional<br />
life merges into one, as communication and thinking are no longer switched<br />
off at the company gates. Work-life balance doesn’t mean working less but working<br />
when you choose. This may apply more or less, depending on the particular target<br />
group. Stereotyping is also of little use here. More helpful are interactive workshops<br />
with representatives of the target group, discussions, creative methods etc. Being an<br />
attractive employer is always relative. There is no such thing as absolute employer<br />
attractiveness – even if certain employer competitions would have us believe so. Being<br />
attractive means meeting the preferences and expectations of a defined group of<br />
people.<br />
The question facing companies now is to what extent they can meet expectations in<br />
certain key functions as of today. Some of the things which appeal to selected target<br />
groups may already be in place, others not. Many aspects generally deemed attractive<br />
may well be in place already, as key functions have been naturally shaped by the<br />
current representatives of certain target groups. Because sales staff think in a very<br />
specific way, you will already find many of the working conditions established by sales<br />
staff over the years which naturally appeal to the relevant target groups of today. But<br />
even if an employer appears attractive in a whole number of aspects, it doesn’t necessarily<br />
translate into a competitive advantage when it comes to attracting top staff. If a<br />
company offered its staff the fitness rooms they crave, for example, it would not help<br />
it stand out from the competition if its competitors did the same – or this was even<br />
Employer attractiveness<br />
7
8 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Report</strong> <strong>2010</strong><br />
the industry standard. To summarize then, the challenge for companies with regard to<br />
attracting staff is to define the right conditions for the defined target groups, based on<br />
the identified key functions, which will ultimately differentiate it from the competition.<br />
This process of examining one’s own role as an employer, one’s target groups and<br />
competitors helps the employer position itself on the market: these are the areas in<br />
which we are attractive, authentic and special. Modesty is not a virtue when it comes<br />
to highlighting the findings from this positioning process. On the contrary, an increasing<br />
number of employers are focusing on communicating exactly those authentic and<br />
special aspects which they have to offer. They systematically direct these messages to<br />
their target groups on the labor market using a variety of media and in the form of an<br />
employer promise. In modern HR management such activities are called “Employer<br />
Branding”, the systematic establishment of an employer brand.<br />
Most companies – and especially mid-size companies – are a kind of black box. As<br />
an outsider, you simply have no idea what it feels like to work there. You often don’t<br />
even know the products they make. At best, potential candidates may have certain<br />
prejudices or put their faith in some kind of image they associate with the employer.<br />
This also applies to major corporations. Who knows for sure what it’s like to work for<br />
Deutsche Bahn, Google, BMW or any other company? Employer branding is a good<br />
way of systematically presenting a company’s special features to the target group in<br />
an attractive and authentic way. Employer branding is still a delicate flower, though,<br />
whose potential is only gradually being recognized since the publication of “The War<br />
for Talent” in the late 90s.<br />
However, today’s Internet users don’t wait passively to receive information on a<br />
company. They have long been actively exchanging information on the Web about<br />
employers and what’s it like to work for them. They are increasingly using Facebook,<br />
employer rating portals, such as kununu, Internet forums or personal blogs.<br />
Companies should recognize this and not wait to transmit their message to the labor<br />
market – however and wherever they decide to do it.<br />
But what about those aspects where companies still have some catching up to do<br />
with regard to their employer attractiveness? In such cases, they must first identify<br />
their weaknesses and then take appropriate action. But not everything which can<br />
be improved should be improved. Not every weakness has to be weeded out. Many<br />
aspects simply cannot be changed – or only with considerable effort. Staff at retail outlets<br />
have to work weekends. Overtime is simply unavoidable in many industries at certain<br />
times. And relocating a company is certainly no small matter. The target group is<br />
not stupid and many things can be communicated in an authentic and understandable
way – some things simply are what they are. One shouldn’t underestimate, however,<br />
the numerous, often small things which can be improved without much effort. Things<br />
where the company can identify a realistic potential for improvement. Ultimately,<br />
the company should first implement those aspects and ideas which the target group<br />
regard as important for enhancing a company’s appeal and which will visibly differentiate<br />
the company from its competitors. This identification of relevant improvement<br />
possibilities ultimately requires the same systematic and focused approach common<br />
to all considerations in this article.<br />
An employer does not need to be attractive in all areas and for all people. What’s<br />
important is to be attractive to certain target groups in certain functions, especially<br />
key functions. If this is already the case, this potential should be leveraged and effectively<br />
communicated with the aid of Employer Branding. Based on this, the company<br />
should then focus on those activities requiring only a reasonable degree of effort<br />
which would enhance its attractiveness from the point of view of the target group and<br />
differentiate it from the competition. Only those companies which take account of the<br />
aspects and systematic approach presented above will succeed in turning the topic of<br />
employer attractiveness into a strategic topic with a sustainable impact. We are still<br />
taking the first steps in Germany – which in some respects is regrettable. On the other<br />
hand though, this offers a unique opportunity, especially for smaller companies. The<br />
increasingly dramatic shortage of skilled staff will inevitably mean that we deal with<br />
this topic much more openly in future than in the past years and decades.<br />
Employer attractiveness<br />
Prof. Dr. Armin Trost<br />
Professor Human<br />
Resource Management<br />
at HFU Business School<br />
Furtwangen<br />
9
10 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Annual</strong> <strong>Report</strong> <strong>Report</strong> <strong>2010</strong> <strong>2010</strong><br />
Products: Filter papers, products and equipment for coffee preparation, dust filter bags and accessories, products for garbage disposal,<br />
cleanliness in pet households, cleaning cloths, descalers, tea filters<br />
Production locations: Minden (Germany), Berlin (Germany), Chézy (France), Tourcoing (France), Shenzhen (China)<br />
Sales companies: France, Austria/Switzerland, the Netherlands/Belgium, Sweden/Denmark, Russia, Czech Republic
<strong>Melitta</strong> HouseholdNavigation Products Subnavigation Europe 11<br />
<strong>Melitta</strong> Household Products Europe is the largest sub-group within the <strong>Melitta</strong> Group<br />
and is represented in many European countries. Products of the strategic business<br />
fields “Coffee Enjoyment” (<strong>Melitta</strong> ® ), “Convenient Cleaning” (Swirl ® ) and “Tea<br />
Enjoyment” (Cilia ® ) are marketed via food retailers and the specialist trade.<br />
www.melitta.de<br />
www.swirl.de
12 <strong>Melitta</strong> <strong>Melitta</strong>Unternehmensgruppe Group <strong>Annual</strong> <strong>Report</strong> Geschäftsbericht <strong>2010</strong> 2008<br />
Economic fluctuations slow business<br />
development<br />
The diverging development of our markets continued in<br />
<strong>2010</strong>. Whereas the economies of certain western<br />
European countries were quick to recover, the states of<br />
eastern Europe continued to suffer from the effects of<br />
the financial and economic crisis. Certain export markets,<br />
including China and South Korea, have since<br />
returned to stability and are becoming increasingly<br />
interesting for our business. All in all, sales were up<br />
slightly on a similar basis of the previous year but still<br />
below expectations.<br />
Focus on business concentration<br />
We used the past year to focus more sharply again on<br />
our main business initiatives. Against this backdrop,<br />
we sold our Gameo ® business in Sweden – our<br />
Scandinavian brand for vacuum bags and accessories. In<br />
order to strengthen our competitiveness, we also merged<br />
filter bag conversion in France with our main site in<br />
Germany. In addition, we developed key strategic parameters<br />
for the future use of our paper mill in Berlin<br />
during the past year. Our new production facility for<br />
filter coffeemakers and electric kettles in Shenzhen<br />
(China) has now successfully overcome its initial difficulties<br />
and easily exceeded its targets over the course of<br />
the year.<br />
Jan Van Riet<br />
CEO<br />
<strong>Melitta</strong> Household Products Europe<br />
There were further shifts in the product portfolio of the<br />
strategic business field “Coffee Enjoyment” in <strong>2010</strong>.<br />
Traditional filter coffee is increasingly being replaced by<br />
other preparation systems, resulting in a decline in<br />
European sales of filter papers. However, these changes<br />
have also led to the growing popularity of our attractive<br />
range of fully automatic coffee machines. The launch of<br />
the Caffeo CI in fall <strong>2010</strong>, for example, surpassed all<br />
expectations. We also succeeded in establishing new<br />
products in the “electric kettle” category.<br />
The products of our strategic business field “Convenient<br />
Cleaning” operate in a highly competitive environment.<br />
Despite the strong competition, however, we fared very<br />
well in this segment during <strong>2010</strong>. Our continual product<br />
enhancements are now paying off. We enjoyed considerable<br />
success, for example, with biofilm and eco garbage<br />
bags made from recycling material in our Swirl ® garbage<br />
bag range. Our long-term commitment to improving<br />
product quality was also recognized by industry<br />
experts: our Swirl ® Airspace vacuum filter bags were<br />
voted Top Brand of <strong>2010</strong> by a major trade journal. Our<br />
new range of products for cleanliness in pet households<br />
was also well received by consumers.
Our brand for<br />
coffee enjoyment.<br />
supplies products for<br />
perfect household<br />
cleaning.<br />
Outlook 2011: Product innovations and line<br />
extensions strengthen position<br />
We expect consumer spending to improve slightly in<br />
2011 with a correspondingly positive impact on our<br />
business. The current situation on the world’s raw<br />
material markets, however, may dampen this positive<br />
trend as it is expected to have a growing influence on<br />
the development of prices.<br />
The changes in coffee preparation systems will continue<br />
and lead to an even more diversified range of products.<br />
As a full-range European supplier with a wide variety of<br />
coffee enjoyment products, we are well positioned on<br />
the market and intend to extend our various product<br />
lines. We regard product innovations as a key driver for<br />
our targeted growth.<br />
In the strategic business field “Convenient Cleaning”,<br />
we will focus mainly on expanding our product range<br />
and distribution in the “cleanliness in pet households”<br />
category. At the same time, we will continue to update<br />
our existing product lines.<br />
The brand for<br />
tea preparation.<br />
The French brand for<br />
dust filter bags and<br />
electronic accessories.<br />
Key figures<br />
Sales<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Capital expenditure<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Employees<br />
Average<br />
<strong>2010</strong><br />
2009<br />
<strong>Melitta</strong> Household Products Europe 13<br />
365,624<br />
404,704<br />
3,625<br />
5,174<br />
1,475<br />
1,277
14 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Annual</strong> <strong>Report</strong> <strong>Report</strong> <strong>2010</strong> <strong>2010</strong><br />
Products: Aluminum foils, baking paper, freshkeeping films, freshkeeping bags, freezer bags,<br />
roasting bags, garbage bags<br />
Production locations: Minden (Germany), Brodnica (Poland)<br />
Sales companies: Madrid (Spain), Brodnica (Poland), St. Petersburg (Russia)
Cofresco Freshkeeping Products Europe<br />
Cofresco is Europe’s leading brand manufacturer for household films. As the techno-<br />
logical leader in its sector, Cofresco markets innovative products under the brand<br />
names Toppits ® , Albal ® , Glad ® , handy bag ® and PrimaPack ® and is represented in<br />
over 70 million households per year in 25 nations. Customer proximity and a wide<br />
and exclusive product range are among our main strengths.<br />
Navigation Subnavigation 15<br />
www.toppits.de
16 <strong>Melitta</strong> <strong>Melitta</strong>Unternehmensgruppe Group <strong>Annual</strong> <strong>Report</strong> Geschäftsbericht <strong>2010</strong> 2008<br />
Following economic crisis consumers turn<br />
increasingly to discount products<br />
The economic and financial crisis continued to impact<br />
our markets in <strong>2010</strong> and led to greater price sensitivity<br />
among consumers. The main beneficiaries were private<br />
label products and discounters. Brand manufacturers<br />
found it difficult to compete in this environment, especially<br />
since the launch of initial premium concepts for<br />
private label products.<br />
Adverse climate for branded products<br />
Cofresco Freshkeeping Products Europe felt the consequences<br />
of growing price sensitivity among consumers<br />
in <strong>2010</strong>. We were unable to generate significant growth<br />
in either the food wrapping or garbage bag categories.<br />
There was even a fall in demand in some cases, caused<br />
in part by cyclical stocking effects.<br />
An increasing number of sales promotions for retailers’<br />
own brands also had a noticeable impact. They led to a<br />
decline in the proportion of our own campaigns in the<br />
three core markets: Germany, France and Spain.<br />
In addition to price pressure from the trade, rising raw<br />
material costs placed an additional burden on business<br />
which could not be fully compensated for. There were<br />
Dirk Löhmer<br />
CEO<br />
Cofresco Freshkeeping Products Europe<br />
positive signals from France, however, with the launch<br />
of a new TV campaign for our garbage bag range.<br />
We used <strong>2010</strong> to enhance the self-selling ability of our<br />
products off the shelf with the launch of eye-catching<br />
new pack designs aimed at differentiating our range<br />
more clearly from private label products. We aim to<br />
make further improvements to our value chain by<br />
modernizing our production facilities and introducing<br />
changes to our processes and organizational structure.<br />
Outlook 2011: Sales growth driven by<br />
extensive market campaigns<br />
We expect consumer price sensitivity to remain high in<br />
2011, which will once again benefit private label products.<br />
Nevertheless, we plan to raise sales revenues with a<br />
host of measures. We will rejuvenate our Toppits ® and<br />
Albal ® brands, streamline our product lines, and launch<br />
a new product campaign in the second half of the year.<br />
Investments in classic communication as well as social<br />
media platforms will strengthen our brands in the core<br />
markets of Germany, France and Spain.<br />
As Europe’s leading brand manufacturer with over 70<br />
million households as customers, Cofresco will focus on<br />
the topic of food waste in 2011. Approximately 25 per-
The key to freshness and flavour,<br />
is the brand for innovative food<br />
wrappings and more.<br />
cent of all food purchased is thrown away by households.<br />
This figure could be reduced significantly with<br />
the right information and the use of our products. A<br />
corresponding pan-European campaign will be launched<br />
on this topic.<br />
We plan to expand both our eastern European business<br />
as well as our B2B branded product business in order to<br />
cement our position as a manufacturer brand. We have<br />
already prepared our market entry in Russia with the<br />
foundation of a local Russian subsidiary. A clear organizational<br />
separation between our private label business<br />
and branded product sales will also be implemented.<br />
Investments in our manufacturing capability will lead to<br />
a further optimization of our processes. We will be<br />
forced to counter rising raw material costs with price<br />
increases in all product categories and in all national<br />
markets.<br />
The products are marketed in other countries<br />
under various brand names: Albal ® in Spain<br />
and France, Glad ® in Portugal, Ireland and<br />
Scandinavia.<br />
Key figures<br />
Sales<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Sales to trade<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Capital expenditure<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Employees<br />
Average<br />
<strong>2010</strong><br />
Cofresco Freshkeeping Products Europe 17<br />
In France, handy bag ®<br />
is our brand for garbage<br />
bags.<br />
40,805<br />
41,107<br />
178,624<br />
184,974<br />
5,330<br />
5,265<br />
290<br />
2009 289
18 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Annual</strong> <strong>Report</strong> <strong>Report</strong> <strong>2010</strong> <strong>2010</strong><br />
Products: Roasted coffee (ground, whole bean), instant cappuccino, pads<br />
Production location / sales company: Bremen
<strong>Melitta</strong> Navigation Coffee Subnavigation Europe 19<br />
<strong>Melitta</strong> Coffee Europe is one of the leading players on the German coffee market.<br />
With its wide range of products – from filter coffee, to coffee for fully<br />
automatic machines, coffee pads and instant cappuccino – the <strong>Melitta</strong> ® brand<br />
stands for the ultimate in coffee expertise and coffee enjoyment. The company’s<br />
main trading partner is the food retail sector.<br />
www.melitta.de
20 <strong>Melitta</strong> <strong>Melitta</strong>Unternehmensgruppe Group <strong>Annual</strong> <strong>Report</strong> Geschäftsbericht <strong>2010</strong> 2008<br />
<strong>Melitta</strong> Coffee Europe<br />
Slight decline in German coffee market<br />
As in the previous years, the classic filter coffee market<br />
continued to decline in <strong>2010</strong>. Based on the total market<br />
for roasted coffee, this decline was only partially offset<br />
by slightly subdued but still double-digit growth in<br />
coffee for fully automatic and single portion machines.<br />
All in all, therefore, the German coffee market suffered<br />
a slight year-on-year fall in demand.<br />
<strong>Melitta</strong> successful in all coffee segments<br />
<strong>2010</strong> proved to be a successful year for <strong>Melitta</strong> Coffee<br />
Europe. We defended our top positions in all roasted<br />
coffee segments and made significant gains in market<br />
share – especially in growth segments. Compared to the<br />
previous year, there was strong overall growth in sales<br />
volume.<br />
Despite a general decline in sales of filter coffee, we<br />
were able to maintain our market share and are still the<br />
number two brand on the market. In the fully automatic<br />
coffee segment we grew much faster than the market<br />
and all competitors. With our outstanding product<br />
quality and broad distribution, we greatly expanded<br />
our share of the market and are currently the strongest<br />
brand in this segment. We also raised sales volumes in<br />
Dr. Frank Strege<br />
CEO<br />
the single portion coffee category: the classic “Auslese”<br />
and “Harmonie” pads and the young “up & awake”<br />
range easily outpaced general market growth and<br />
defended their positions in a fiercely competitive environment.<br />
We just about defended our share of the<br />
instant coffee specialties market, although the segment<br />
as a whole continued to decline.<br />
There was double-digit growth in exports in <strong>2010</strong> with a<br />
very positive contribution to earnings. In addition to<br />
business with our close neighbors, there was also<br />
encouraging growth in East Europe, Australia and the<br />
Middle East.<br />
Strong increases in coffee commodity prices from the<br />
second half of <strong>2010</strong> onward represent a considerable<br />
challenge for the market which is expected to continue<br />
in 2011.
Our brand for<br />
coffee enjoyment.<br />
Outlook 2011: Prices slow consumption,<br />
further growth for <strong>Melitta</strong><br />
Due to the rise in green bean prices, we expect consumer<br />
demand for filter coffee to slow in 2011. In view<br />
of this price development and the trend toward private<br />
label products, we also expect lower growth rates for<br />
fully automatic and single portion coffees than in the<br />
previous year.<br />
Our dedicated team will continue to react to this more<br />
subdued demand with outstanding product quality,<br />
extensive coffee expertise, and a stronger brand presence<br />
aimed at strengthening our market standing.<br />
Key figures<br />
Sales<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Capital expenditure<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Employees<br />
Average<br />
<strong>2010</strong><br />
2009<br />
<strong>Melitta</strong> Coffee Europe 21<br />
331,438<br />
298,673<br />
624<br />
2,397<br />
171<br />
170
22 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Annual</strong> <strong>Report</strong> <strong>Report</strong> <strong>2010</strong> <strong>2010</strong><br />
Products: Coffee machines, fully automatic coffee machines, filter papers, roasted coffee, accessories, tea<br />
Production locations: Minden (Germany), Hunzenschwil (Switzerland)<br />
Sales companies: Hunzenschwil (Switzerland), Salzburg (Austria), Saint Tibault des Vignes (France),<br />
Hardinxveld (Netherlands), Elgin (USA), Tokyo (Japan)
<strong>Melitta</strong> Navigation SystemService<br />
Subnavigation 23<br />
<strong>Melitta</strong> SystemService is the specialist for professional coffee serving in the hotel<br />
and catering sector. The company’s core business is the manufacturing and global<br />
marketing of filter coffee machines and fully automatic coffee machines for the<br />
preparation of coffee specialties. <strong>Melitta</strong> SystemService also operates its own<br />
international customer service.<br />
www.melittasystemservice.de
24 <strong>Melitta</strong> <strong>Melitta</strong>Unternehmensgruppe Group <strong>Annual</strong> <strong>Report</strong> Geschäftsbericht <strong>2010</strong> 2008<br />
<strong>Melitta</strong> SystemService<br />
Strong improvement in investment climate<br />
The beginning of fiscal year <strong>2010</strong> was still dominated on<br />
the whole by the effects of the financial crisis. Although<br />
Germany was quick to recover, the propensity to invest<br />
in capital goods remained low in central European<br />
markets. By the end of the year, however, there was a<br />
noticeable upturn in our markets. On the whole, the<br />
year exceeded the expectations of the operating division<br />
<strong>Melitta</strong> SystemService. With new major international<br />
orders and the successful launch of a new fully automatic<br />
machine, the <strong>Melitta</strong> c35, we were able to generate<br />
double-digit sales growth.<br />
More international and professional<br />
In addition to a sustained improvement in our operating<br />
business, we also took steps to improve our business<br />
organization. The aim is to drive the division’s international<br />
expansion and become more effective and professional.<br />
The measures include the introduction of centralized<br />
functions, such as the “International Technology<br />
Center” and “International Technical Customer Service”,<br />
as well as the establishment of a “Global Account<br />
Management” unit. In order to achieve greater market<br />
proximity and improve customer retention, we also<br />
reduced the number of hierarchy levels. Marketing<br />
expenditure has also been centralized.<br />
Harald Johanning-Meiners<br />
CEO<br />
In addition to these organizational measures, a further<br />
key topic in the reporting period was the revision of our<br />
product strategy. We now aim to strictly implement this<br />
strategy in the coming two years.<br />
Outlook 2011: Leveraging growth potential<br />
through technological leadership and structural<br />
improvements<br />
We will continue our successful development in the<br />
current year and lay further foundations for sustainable<br />
and profitable growth. We will focus above all on<br />
enhancing our innovative strength and aim to become<br />
the technological leader in our B2B business.<br />
We also see growth potential in the Asia-Pacific region,<br />
which is still enjoying strong economic growth. With the<br />
aid of new partners in this region and additional staff,<br />
we aim to achieve a wide-ranging improvement in our<br />
market positions. Due to the ongoing economic difficulties,<br />
the USA remains a tough but interesting market.<br />
We have strengthened our sales team here in order to<br />
widen the basis of our business operations. In Europe,<br />
we expect conditions to stabilize further and aim to<br />
capture market share with the measures already implemented.
Our brand for<br />
coffee enjoyment.<br />
The brand for fully automatic<br />
coffee specialty machines.<br />
The launch of a new fully automatic coffee machine, the<br />
<strong>Melitta</strong> bar-cube, will have a major impact on our international<br />
business. Featuring attractive performance<br />
components, the new line will give a significant boost to<br />
our standard business.<br />
Key figures<br />
Sales<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Capital expenditure<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Employees<br />
Average<br />
<strong>2010</strong><br />
2009<br />
<strong>Melitta</strong> SystemService 25<br />
131,938<br />
115,145<br />
1,712<br />
2,117<br />
708<br />
702
26 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Annual</strong> <strong>Report</strong> <strong>Report</strong> <strong>2010</strong> <strong>2010</strong><br />
Products: Roasted coffee (ground, whole bean), instant cappuccino, filter papers, industrial papers<br />
Headquarter: São Paulo<br />
Production locations: São Paulo, Avaré, Guaíba, Bom Jesus
<strong>Melitta</strong> has been offering a range of products for coffee preparation in the world’s<br />
largest coffee-producing nation since 1968. The range includes various coffee blends<br />
produced at the company’s own roasting plants, as well as filter papers and industrial<br />
papers produced at its own paper plant.<br />
Navigation <strong>Melitta</strong> Subnavigation Brasil 27<br />
www.melitta.com.br
28 <strong>Melitta</strong> <strong>Melitta</strong>Unternehmensgruppe Group <strong>Annual</strong> <strong>Report</strong> Geschäftsbericht <strong>2010</strong> 2008<br />
<strong>Melitta</strong> Brasil<br />
Coffee business outpacing the market<br />
For the eighth consecutive year, <strong>Melitta</strong> Brasil posted<br />
double-digit sales growth year on year.<br />
The Brazilian coffee market as a whole enjoyed strong<br />
growth in <strong>2010</strong>. However, with over seven percent<br />
volume growth and almost five percent revenue growth,<br />
our coffee business performed even better than the<br />
market. Both our brands benefited from this growing<br />
demand and added to their already high market shares.<br />
Growth was particularly strong in the more highly<br />
developed regions of South and South-East Brazil, but<br />
also in Rio de Janeiro and parts of North-East Brazil.<br />
Our premium line of sustainably harvested coffees,<br />
<strong>Melitta</strong>’s Regiões Brasileiras, made encouraging progress.<br />
However, our Bom Jesus ® coffee brand for everyday<br />
enjoyment is also proving highly popular and<br />
achieved growth in all markets.<br />
Bernardo Wolfson<br />
CEO<br />
Strong increase in filter paper business<br />
Following a stable development over the previous years,<br />
the filter paper segment contributed strongly to our<br />
business result in the period under review. Various<br />
product enhancements helped boost sales volume and<br />
led to increased revenue. Much of this success is owed<br />
to the launch of new pack sizes: the 60-filter pack for<br />
heavy coffee drinkers and a new reduced pack size with<br />
30 filters. After years of stagnation, our filter paper<br />
business achieved growth once again and cemented<br />
our excellent market position.
Our brand for<br />
coffee enjoyment.<br />
Our regional brand for<br />
everyday coffee enjoyment.<br />
Outlook 2011: Further growth targeted<br />
Driven by the rising consumption of a rapidly growing<br />
middle class as well as major investments for sporting<br />
events such as the FIFA World Cup and the Olympic<br />
Games, the Brazilian economy is set for even stronger<br />
growth over the coming five years.<br />
We aim to harness these developments and raise both<br />
sales volume and revenue. This applies both to coffee<br />
and to our range of coffee preparation products. With<br />
new products and increased marketing efforts, we plan<br />
to capture new customers with our compelling brands<br />
and product portfolio.<br />
Key figures<br />
Sales<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Capital expenditure<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Employees<br />
Average<br />
<strong>2010</strong><br />
2009<br />
<strong>Melitta</strong> Brasil 29<br />
292,489<br />
221,439<br />
5,254<br />
2,884<br />
585<br />
544
30 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Annual</strong> <strong>Report</strong> <strong>Report</strong> <strong>2010</strong> <strong>2010</strong><br />
Products: Roasted coffee (ground, whole bean), filter papers, coffee preparation products<br />
Production locations: Clearwater, FL, Cherry Hill, NJ
<strong>Melitta</strong> has been active on the US market since the 60s. The company<br />
produces filter papers and coffee at its own facilities. The <strong>Melitta</strong> coffee blends<br />
are positioned as premium products on the North American coffee market.<br />
<strong>Melitta</strong> filter papers enjoy a leading position in the USA.<br />
Navigation <strong>Melitta</strong> Subnavigation USA 31<br />
www.melitta.com
32 <strong>Melitta</strong> <strong>Melitta</strong>Unternehmensgruppe Group <strong>Annual</strong> <strong>Report</strong> Geschäftsbericht <strong>2010</strong> 2008<br />
<strong>Melitta</strong> USA<br />
Implementation of coffee strategy<br />
<strong>2010</strong> was a challenging year for the American coffee<br />
industry. High green bean prices and the exceptionally<br />
strong demand for single portion capsules had an<br />
unforeseen impact on our coffee business. Against this<br />
backdrop, we focused mainly on the implementation of<br />
our product strategy.<br />
Based on the success of our coffee strategy in the<br />
regional market of Philadelphia, we expanded our<br />
premium product line “Café Collection” and now also<br />
offer it in New York. In Philadelphia, we succeeded in<br />
significantly enhancing our share of the retail grocery<br />
market and by the end of <strong>2010</strong> we were the number one<br />
premium brand. With a strong increase in sales volume,<br />
we were able to achieve double-digit revenue growth in<br />
North-East America year on year. In addition to our<br />
standard range, we now also offer coffee in tins with the<br />
mild-roasted “New Breakfast Blend” for those consumers<br />
who prefer a milder flavor.<br />
During the course of the year, we successfully completed<br />
the modernization work on our coffee roasting plant. All<br />
stages of production have been improved: from the<br />
delivery of green beans, to roasting, grinding and pack-<br />
Marty Miller<br />
CEO<br />
ing. The modernized roasting plant enables us to produce<br />
more efficiently and sustainably, while also raising<br />
capacities and significantly enhancing quality.<br />
In our filter paper business, we succeeded in making<br />
small gains in our share of the retail grocery market.<br />
Both filter papers and basket filters held their ground<br />
despite an overall decline in market volume due to the<br />
trend toward single portion coffee.
Our brand for<br />
coffee enjoyment.<br />
Outlook 2011:<br />
Further regional markets targeted<br />
In cooperation with our partner Hamilton Beach – a<br />
leading manufacturer of coffeemakers and appliances –<br />
we presented our latest coffee preparation products,<br />
such as new filter coffeemakers, at the “International<br />
Home and Houseware Show”. <strong>Melitta</strong>’s products for<br />
manual coffee preparation are enjoying increasing<br />
popularity. This form of coffee enjoyment is developing<br />
into a trend in America. <strong>Melitta</strong> therefore aims to position<br />
itself as the expert for manual filtration and support<br />
this claim with high-impact PR work.<br />
We intend to expand our coffee strategy on the US<br />
market and tap further regional markets. With our<br />
premium product range, we want to inform more coffee<br />
lovers about our 100 years of expertise in coffee preparation<br />
and strengthen our standing on the American<br />
market.<br />
Key figures<br />
Sales<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Capital expenditure<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Employees<br />
Average<br />
<strong>2010</strong><br />
2009<br />
<strong>Melitta</strong> USA 33<br />
56,684<br />
53,830<br />
4,665<br />
2,774<br />
120<br />
122
34 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Annual</strong> <strong>Report</strong> <strong>Report</strong> <strong>2010</strong> <strong>2010</strong><br />
Products: Roasted coffee (ground, whole bean), filter papers<br />
Location: Vaughan
<strong>Melitta</strong> Canada markets coffee and coffee preparation products<br />
via the Canadian grocery trade.<br />
Navigation <strong>Melitta</strong> Subnavigation Canada 35<br />
www.melitta.ca
36 <strong>Melitta</strong> <strong>Melitta</strong>Unternehmensgruppe Group <strong>Annual</strong> <strong>Report</strong> Geschäftsbericht <strong>2010</strong> 2008<br />
<strong>Melitta</strong> Canada<br />
Sales growth in adverse market environment<br />
The Canadian economy was marked by general uncertainty<br />
and subdued consumer spending in <strong>2010</strong>. On the<br />
coffee market, business suffered from fierce competition<br />
as well as from rising costs which retailers passed on to<br />
suppliers and manufacturers. Moreover, the sharp rise<br />
in demand for single portion coffees of over 60 percent<br />
represented further strong competition.<br />
In view of these circumstances, we found it difficult to<br />
follow up the success of the previous year in our coffee<br />
business. Although revenue from coffee sales grew by<br />
four percent, it fell short of the double-digit growth<br />
achieved by the market as a whole.<br />
We made strong progress, however, in our filter paper<br />
business with double-digit growth in sales revenue –<br />
outpacing the market which grew by just five percent.<br />
This encouraging performance was mainly the result of<br />
our intensive marketing efforts and the success of our<br />
bamboo filter papers, which achieved an outstanding<br />
position on the market. This enabled us to counter the<br />
fast growing enthusiasm for single portion coffees.<br />
William J. Ivany<br />
CEO<br />
Thanks to the strong development in the field of filter<br />
papers, we reached a total of double-digit sales growth.
Our brand for<br />
coffee enjoyment.<br />
Outlook 2011: Double-digit growth expected<br />
We expect sales growth to reach double figures in 2011<br />
– partly due to growing sales volumes of coffee and<br />
coffee filters, but also as a result of the rising cost of<br />
coffee on the world’s commodity markets.<br />
We have planned a number of measures for our products<br />
aimed at conquering further market niches and<br />
boosting sales. In our filter paper business, we will<br />
continue to focus on communicating product quality<br />
and the resulting customer benefits.<br />
Key figures<br />
Sales<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Capital expenditure<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Employees<br />
Average<br />
<strong>2010</strong><br />
2009<br />
<strong>Melitta</strong> Canada 37<br />
23,953<br />
20,269<br />
94<br />
74<br />
10<br />
10
38 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Annual</strong> <strong>Report</strong> <strong>Report</strong> <strong>2010</strong> <strong>2010</strong><br />
Products: Vacuum cleaner bags, holders for vacuum cleaner bags, vacuum cleaner nozzles, particle and odor filters<br />
Production locations: Vlotho/Exter, Spenge (Germany), Overpelt (Belgium)
Wolf PVG is a highly specialized systems supplier of everything needed for<br />
vacuum cleaners and industrial filter technology – from the idea to the mass produced<br />
finished product. Its expertise comprises design, process technology, construction<br />
and manufacturing. The main trade partner for vacuum cleaner bags<br />
is <strong>Melitta</strong> Household Products Europe.<br />
Navigation Wolf Subnavigation PVG 39<br />
www.wolf-pvg.de
40 <strong>Melitta</strong> <strong>Melitta</strong>Unternehmensgruppe Group <strong>Annual</strong> <strong>Report</strong> Geschäftsbericht <strong>2010</strong> 2008<br />
Wolf PVG<br />
Slight rise in sales and high<br />
raw material prices<br />
The vacuum cleaner market recovered as expected in<br />
the past year and helped manufacturers achieve a slight<br />
increase in sales. This also benefited Wolf PVG.<br />
However, this positive effect from business with vacuum<br />
cleaner manufacturers was offset somewhat by stagnating<br />
sales to the retail trade. Business with the trade fell<br />
just short of expectations and meant that total sales<br />
remained virtually unchanged from the previous year.<br />
Strong increases in raw material prices – up to 30 percent<br />
higher over the year – placed a further burden on<br />
our business.<br />
Production launch for various new products<br />
Thanks to our own development center, we are particularly<br />
strong in the field of new product innovations. This<br />
enabled us to launch production of a variety of new<br />
products. For example, we developed vacuum cleaner<br />
nozzles for special application fields on behalf of <strong>Melitta</strong><br />
Household Products Europe for its newly created pet<br />
range.<br />
Dr. Lutwin Spix<br />
CEO<br />
Our development projects also included the enhancement<br />
of vacuum cleaner bags and filters for electrical<br />
appliances using high-performance filter materials.
The brand for<br />
vacuum cleaner bags<br />
and accessories.<br />
Outlook 2011:<br />
Investment in improved quality<br />
On the basis of our new products, we expect sales to<br />
manufacturers to increase in 2011. Sales to the retail<br />
trade are expected to remain stable.<br />
In order to improve the quality of our products even<br />
more, we will be investing in the field of filter materials<br />
in 2011. We believe this will help us expand our market<br />
position, while improving the utilization of our production<br />
capacities and raising the efficiency of our value<br />
added processes.<br />
Key figures<br />
Sales<br />
in € ’000<br />
<strong>2010</strong><br />
19,949<br />
2009 18,618<br />
Sales to trade<br />
in € ’000<br />
<strong>2010</strong><br />
Capital expenditure<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Employees<br />
Average<br />
<strong>2010</strong><br />
2009<br />
52,765<br />
2009 50,441<br />
3,840<br />
2,369<br />
242<br />
237<br />
Wolf PVG 41
42 <strong>Melitta</strong> <strong>Melitta</strong>Group Unternehmensgruppe Group <strong>Annual</strong> <strong>Annual</strong> <strong>Report</strong> <strong>Report</strong> <strong>2010</strong> <strong>2010</strong> Geschäftsbericht <strong>2010</strong><br />
Products: Specialist papers<br />
Production location: Neu Kaliß
<strong>Melitta</strong> Neu Haushaltsprodukte Kaliss Navigation Spezialpapier<br />
Subnavigation Europa 43<br />
Neu Kaliss Spezialpapier GmbH manufactures specialist papers<br />
and nonwoven materials for industrial use and converts and markets<br />
paper products for various niche markets.<br />
www.nkpaper.com
44 <strong>Melitta</strong> <strong>Melitta</strong>Unternehmensgruppe Group <strong>Annual</strong> <strong>Report</strong> Geschäftsbericht <strong>2010</strong> 2008<br />
Neu Kaliss Spezialpapier<br />
Back on track for growth<br />
<strong>2010</strong> was a successful year for Neu Kaliss Spezialpapier.<br />
We believe this was the result of the commitment we<br />
displayed in the previous year with regard to introducing<br />
various changes.<br />
We succeeded in reducing costs, for example, in a<br />
number of areas. At the same time, we remained committed<br />
to upholding quality and developed a number of<br />
new premium products for our core range. We gained<br />
new customers in various new markets and were able to<br />
drive our international business.<br />
These measures paid off and had a clearly positive<br />
impact: our business developed much more strongly<br />
than expected. Despite the enormous pressure from<br />
rising raw material costs throughout the year, we were<br />
able to successfully counter these developments and<br />
even achieved strong gains in exports, for example. This<br />
was driven in part by our newly developed and individually<br />
tailored nonwoven products which enabled us to<br />
gain important new customers around the world.<br />
Dieter Kirchner<br />
CEO<br />
John Paul Fender<br />
CEO<br />
In the past fiscal year, we invested mainly in product<br />
development and in new hardware and software aimed<br />
at raising our efficiency.
Outlook 2011: Expansion of market shares<br />
Competition will remain fierce in the current year. In<br />
order to strengthen our position in our core market, we<br />
plan to take steps in 2011 to expand our capacities in the<br />
field special paper manufacturing. This increased capacity<br />
will then be available to us from mid 2012 onward.<br />
Key figures<br />
Sales<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Capital expenditure<br />
in € ’000<br />
<strong>2010</strong><br />
2009<br />
Employees<br />
Average<br />
<strong>2010</strong><br />
2009<br />
Neu Kaliss Spezialpapier 45<br />
35,913<br />
28,497<br />
1,289<br />
725<br />
129<br />
128
46 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Report</strong> <strong>2010</strong><br />
Group Management <strong>Report</strong><br />
for the Fiscal Year <strong>2010</strong><br />
Consolidated sales of the <strong>Melitta</strong> Group in <strong>2010</strong> were<br />
well in excess of the previous year’s level. A slight<br />
improvement in economic conditions, exchange rate<br />
effects and the successful launch of new products<br />
helped raise sales by 8 percent with satisfactory earnings<br />
on the whole. Further expansion of business is planned<br />
in the current year.<br />
Business activity<br />
Production and marketing of branded goods in the<br />
categories Coffee, Food Preparation, Household and<br />
Industrial<br />
<strong>Melitta</strong> is a family-run international manufacturer of<br />
branded products. It develops, produces and markets<br />
branded products for coffee enjoyment, food storage and<br />
preparation, as well as domestic cleaning. The company’s<br />
product range also includes specialist papers and<br />
films, which are mainly marketed to industrial clients in<br />
Germany and abroad.<br />
Founded in 1908, the family-owned company is headed<br />
by a management holding company and managed<br />
according to its mission statement and fundamental<br />
principles. The management holding company is based<br />
in Minden, Germany, as are the Group’s classic corporate<br />
functions. The <strong>Melitta</strong> Group is organized decentrally.<br />
This enables its operating divisions and national<br />
subsidiaries to closely align their operations with the<br />
needs of the respective markets.<br />
The Group has pooled its business activities into three<br />
strategic business fields and a segment which focuses<br />
on industrial clients: the strategic business field “Coffee<br />
and Tea Enjoyment” accounts for 65 percent (prior year:<br />
63 percent) of the Group’s total consolidated sales. The<br />
<strong>Melitta</strong> ® brand – coffee, filter papers and coffee<br />
machines for domestic and commercial use – generates<br />
the largest proportion of sales in this business field.<br />
Products for household cleaning and tidying are pooled<br />
in the strategic business field “Convenient Cleaning”.<br />
This business comprises the Swirl ® and handy bag ®<br />
product groups and accounts for 6 percent of sales (prior<br />
year: 8 percent).<br />
The strategic business field “Freshness and Flavour” is<br />
allocated to the Cofresco sub-group. This business generates<br />
13 percent (prior year: 15 percent) of total revenues<br />
with products designed to facilitate the fresh-keeping,<br />
storage and preparation of food.<br />
The Group’s product range is rounded out by specialist<br />
papers – especially for the wallpaper industry – and<br />
industrial films for food packaging. Together with the<br />
Group’s private label products, these account for 16 percent<br />
(prior year: 14 percent) of total sales. This industrial<br />
end-user business was expanded in <strong>2010</strong> with the addition<br />
of the company ACW-Film GmbH & Co. KG,<br />
Rhede, Germany. <strong>Melitta</strong> acquired 100 percent of this<br />
company’s shares on July 1, <strong>2010</strong>.<br />
Development of business<br />
The Group enjoyed growth in sales and is generally<br />
satisfied with its expansion of business<br />
Economic conditions improved on our markets in <strong>2010</strong>.<br />
In our industrial business in particular (specialist papers<br />
and commercial users), there was a marked recovery in<br />
demand following a steep fall in sales in the previous<br />
years due to recession. In comparison with the growth<br />
rates of these more cyclical industrial sectors, however,<br />
growth in private consumption was considerably slower.<br />
The consolidated sales revenue of the <strong>Melitta</strong> Group<br />
grew by 8 percent, from € 1,202 million to € 1,301 million<br />
in <strong>2010</strong>. This growth was helped by foreign<br />
exchange effects which led to a 5 percent increase in<br />
sales. The net increase in sales resulting from increased<br />
volumes or prices thus amounted to 3 percent. The<br />
background to this growth was a generally positive<br />
development of coffee sales and a strong increase in<br />
sales of specialist papers. However, we suffered a decline
in sales of filter papers in Europe and Cofresco<br />
products.<br />
There were strong differences in progress between the<br />
various divisions and regions once again in <strong>2010</strong>. All in<br />
all, our business with coffee machines and accessories<br />
for the food service sector was highly encouraging. Neu<br />
Kaliss also made strong progress in its sales of specialist<br />
papers: expansion of the company’s foreign business<br />
and a recovery of domestic demand led to a sharp rise in<br />
revenues. We will expand our capacities in this field in<br />
future via the company Neukölln Spezialpapier NK<br />
GmbH & Co. KG, founded in late <strong>2010</strong>.<br />
Our national subsidiaries in the USA, Canada and Brazil<br />
once again made encouraging progress. Against the<br />
backdrop of a flourishing economy and thus rising consumption,<br />
we are particularly optimistic about the future<br />
growth opportunities for our coffee and filter paper business<br />
in Brazil. In <strong>2010</strong>, <strong>Melitta</strong> do Brasil succeeded in<br />
expanding its shares of the growing roasted coffee and<br />
filter paper markets. We also see good opportunities to<br />
expand our coffee business in North America with the<br />
aid of innovative branded products and the regional<br />
expansion of our distribution network.<br />
Pressure from private label suppliers and discounters,<br />
coupled with subdued consumer demand in western<br />
Europe, prevented any increase in sales of our products<br />
in the strategic business field “Freshness and Flavour”.<br />
Sales of the strategic business field “Convenient Cleaning”<br />
once again remained at the prior-year level. Dust<br />
filter bags made good progress, while sales of garbage<br />
bags fell slightly year on year. There was a boost to<br />
growth from the business field’s introduction of products<br />
for cleanliness in pet households.<br />
Compared to the previous year, sales of coffee made<br />
good progress in Germany. However, the development<br />
of business was also impacted by a strong increase in<br />
green bean prices. The price of “Arabica” beans, for<br />
example, climbed from 138 cts/lb to 242 cts/lb during<br />
the year.<br />
There were also some strong increases in the raw material<br />
prices of aluminum and cellulose. Hedging transactions<br />
helped cushion the impact on earnings, however.<br />
As we were unable to pass on other increases in raw<br />
material costs, as well as in fixed costs (e.g. energy),<br />
there was a slight negative impact on consolidated<br />
earnings.<br />
Personnel expenses increased in total by 4 percent due<br />
mainly to the hiring of staff abroad.<br />
All in all, the <strong>Melitta</strong> Group is satisfied with the development<br />
of sales and earnings in the past fiscal year.<br />
Assets and finance<br />
Group Management <strong>Report</strong><br />
Group still boasts stable assets and financial position<br />
The Group’s total assets grew by € 26 million, from<br />
€ 598 million to € 624 million, as a result of capital<br />
expenditures and an increase in current assets. Due to<br />
the strong revaluation of certain relevant currencies,<br />
there was also a net increase in total assets as of<br />
December 31, <strong>2010</strong> resulting from currency translation.<br />
The regulations of the German Accounting Law Modernization<br />
Act (BilMoG) to be applied for the first time<br />
in <strong>2010</strong>, and in particular the ability to choose how to<br />
allocate differences from the revaluation of pension<br />
accruals, had no material impact on the asset position.<br />
The creation of a liquidity buffer of € 14 million, the<br />
purchase of a 100-percent shareholding in ACW-Film<br />
GmbH & Co. KG and investments in the expansion<br />
and modernization of plant and machinery, especially<br />
in North America and Brazil, led to an increase in<br />
assets of € 25 million. They rose from € 207 million to<br />
€ 232 million.<br />
47
48 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Report</strong> <strong>2010</strong><br />
Inventories rose much faster than sales, partly due to<br />
increased procurement and sales prices. Inventories<br />
increased by € 21 million, from € 123 million to € 144<br />
million. The increase in inventories also indicates the<br />
Group’s healthy order position at year-end <strong>2010</strong>.<br />
There was a significant increase in trade receivables as a<br />
result of the expansion of business activities. They rose<br />
by 14 percent to € 199 million. The last scheduled repayment<br />
of a receivable from the sale of shares in previous<br />
years led to a reduction in other assets.<br />
Scheduled funding needs were mainly financed by a<br />
reduction in cash and cash equivalents from € 37 million<br />
to € 10 million and an increase in short- and medium-term<br />
bank liabilities from € 24 million to € 33 million.<br />
This resulted in a net bank liability of € 23 million<br />
as of December 31, <strong>2010</strong>, compared to a positive net<br />
bank balance of € 13 million as of December 31, 2009.<br />
Equity capital increased from € 200 million to € 234 million.<br />
The net difference was influenced by net income<br />
for the reporting period, foreign currency changes without<br />
effect on income, and contributions/withdrawals of<br />
the owners. Equity accounted for 38 percent of the balance<br />
sheet total, after deduction of cash and cash equivalents.<br />
There were no effects on equity from the initial<br />
adoption of new commercial balance sheet regulations.<br />
As the total of other accruals and tax accruals, the balance<br />
of other accruals fell mainly as a result of a payment<br />
on account from the accrual formed in previous<br />
years for pending proceedings with the Federal Cartel<br />
Office. Cash flow from operating activities fell year on<br />
year in connection with the increase in net current<br />
assets. Cash flow from financing activities was influenced<br />
by withdrawals of the owners and the increase in<br />
short- and medium-term bank liabilities.<br />
Employees<br />
Headcount up 7 percent<br />
The Group employed an annual average of 3,812 people<br />
in <strong>2010</strong>. This represents growth of 7 percent compared<br />
to 2009, following the creation of 256 jobs on average<br />
around the world. The growth resulted mainly from the<br />
assembly plant in China and companies in Brazil.<br />
The number of apprentices at the Group’s German facilities<br />
amounted to 70 as of the balance sheet date (prior<br />
year: 72).<br />
Opportunities and risks<br />
Company’s development accompanied by suitable risk<br />
management system<br />
The <strong>Melitta</strong> Group uses a differentiated risk management<br />
system aimed at the structured identification and<br />
assessment of opportunities and risks. Risk management<br />
is regarded as all organizational regulations and<br />
measures for the early recognition, evaluation and analysis<br />
of corporate risks.<br />
<strong>Melitta</strong> pursues a business strategy which can be classified<br />
as risk-averse. In the course of auditing the annual<br />
financial statements <strong>2010</strong>, the external auditors confirmed<br />
that the risk early recognition system was suitable<br />
and in line with statutory requirements.<br />
The risk management system comprises suitable risk<br />
reporting procedures. These ensure that the managers<br />
responsible are constantly and quickly informed about<br />
potential risks and opportunities. This enables both the<br />
Group and individual companies to take fast and effective<br />
corrective measures.<br />
The main risks of the <strong>Melitta</strong> Group result from general<br />
economic developments, sector developments, and risks<br />
from general operating activities. In addition, the Group<br />
is exposed to financial risks, and especially risks from<br />
currency and raw material fluctuations.
<strong>Melitta</strong> counters raw material price risks by concluding<br />
long-term procurement contracts and using derivative<br />
financial instruments.<br />
The monitoring and controlling of financial risks is<br />
entrusted to the Group’s treasury division. Foreign<br />
exchange and interest hedging instruments (options,<br />
swaps, futures and interest derivatives) are used where<br />
necessary to hedge against specific risks from existing<br />
or foreseeable underlying transactions. Liquidity risks<br />
and risks from cash flow fluctuations are countered by<br />
group-wide and ongoing liquidity planning.<br />
No recognizable risks jeopardizing the company<br />
Based on an analysis of the current risk situation, it can<br />
be stated that there are no risks at present which might<br />
jeopardize the Group’s continued existence. There are<br />
also no currently recognizable risks which might jeopardize<br />
the Group’s continued existence in future.<br />
Start of 2011 and outlook<br />
Positive external conditions<br />
<strong>Melitta</strong> got off to a successful start in 2011. The macroeconomic<br />
conditions are promising on the whole. In<br />
Germany, we expect consumer spending to benefit from<br />
the more favorable economic climate. Our markets in<br />
North and South America also provide encouraging conditions<br />
for further growth: we intend to expand our business<br />
in Brazil with the further regional extension of the<br />
<strong>Melitta</strong> sales system. Our investment in a new roasting<br />
plant in the USA has also created sufficient capacity to<br />
drive our business in this region.<br />
We expect to make further encouraging progress in our<br />
specialist paper business. There is considerable potential<br />
in Germany and abroad which we aim to exploit not<br />
only with our business in Neu Kaliss, but as of late <strong>2010</strong><br />
also with our newly founded company Neukölln Spezialpapier<br />
in Berlin. <strong>Melitta</strong> will invest approx. € 15 to € 18<br />
million up to 2012 in the expansion and modernization<br />
of its paper plant in Berlin via the new company. This<br />
will result in further expansion of the Group’s industrial<br />
business.<br />
No material changes in the Group’s structure are<br />
planned for 2011.<br />
Group Management <strong>Report</strong><br />
Under consideration of the prorated investment in the<br />
new paper machine, capital expenditures of around € 35<br />
million will far exceed depreciation in 2011.<br />
At the end of the year, we expect net bank liabilities to<br />
reach approximately € 35 million. This figure includes<br />
the aforementioned capital expenditures, funds to<br />
finance current operating activities and scheduled withdrawals<br />
by the owners. The funds required will be covered<br />
by the use of our existing short- and long-term borrowing<br />
facilities.<br />
We expect the balance sheet to remain healthy in 2011<br />
with a strong equity base and low level of debt.<br />
49
50 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Report</strong> <strong>2010</strong><br />
Consolidated Balance Sheet<br />
<strong>Melitta</strong> Unternehmensgruppe Bentz KG<br />
as at 12-31-<strong>2010</strong> (abridged version)<br />
Assets<br />
in € ’000<br />
12-31-<strong>2010</strong> 12-31-2009<br />
Intangible assets 18,851 15,436<br />
Tangible assets<br />
Financial assets<br />
175,028 167,323<br />
Shares in affiliated companies 1,846 1,846<br />
Participation interests 21,245 21,012<br />
Other financial assets 14,779 940<br />
Fixed assets 231,749 206,557<br />
Inventories<br />
Receivables and other current assets<br />
143,865 123,441<br />
Trade receivables 198,626 173,840<br />
Other receivables and current assets 24,560 46,378<br />
Cash and cash equivalents 10,330 36,679<br />
Current assets 377,381 380,338<br />
Other assets 15,227 10,849<br />
Assets total 624,357 597,744<br />
Equity and Liabilities<br />
in € ’000<br />
12-31-<strong>2010</strong> 12-31-2009<br />
Equity (incl. shares of other shareholders) 234,152 199,974<br />
Pension accruals 134,133 129,588<br />
Other accruals 105,087 136,229<br />
Accruals 239,220 265,817<br />
Debts 33,101 23,844<br />
Trade payables 66,928 55,706<br />
Other liabilities 44,502 47,852<br />
Liabilities 144,532 127,402<br />
Prepaid expenses 6,454 4,551<br />
Equity and Liabilities total 624,357 597,744
Explanatory notes on the consolidated balance sheet<br />
1. General information on accounting and valuation<br />
Certain items of the consolidated financial statements,<br />
drawn up in accordance with Sec. 13 German Company<br />
Disclosure Law (PublG) in conjunction with Sec. 294-<br />
314 German Commercial Code (HGB), have been combined<br />
for the publication of this annual report for fiscal<br />
<strong>2010</strong>. The <strong>Melitta</strong> Group makes use of the exemption<br />
pursuant to Sec. 13 (3) Sentence 2 PublG regarding the<br />
publishing of income statements. The consolidated<br />
financial statements and Group management report,<br />
which were awarded an unqualified audit opinion by the<br />
independent auditors, and the disclosures pursuant to<br />
Sec. 5 (5) Sentence 3 PublG are published in the Federal<br />
Gazette.<br />
Consolidated group<br />
The consolidated financial statements include all domes-<br />
tic and foreign companies under the common control of<br />
<strong>Melitta</strong> Unternehmensgruppe Bentz KG.<br />
The consolidated group comprises 56 (prior year: 50)<br />
companies. The notes to the consolidated financial statements<br />
published in the Federal Gazette include a full list<br />
of shareholdings.<br />
Due to their minor importance for the assets, liabilities,<br />
financial position and earnings of the Group, seven<br />
companies (prior year: nine) were not included in the<br />
consolidated financial statements. Despite a shareholding<br />
of over 20 percent, three other companies were not<br />
included as associated companies since <strong>Melitta</strong><br />
Unternehmensgruppe Bentz KG exerts no significant<br />
influence on their business and financial policy.<br />
In accordance with Sec. 311 HGB, major participations<br />
are to be valued using the equity method if a significant<br />
Consolidated Balance Sheet<br />
influence can be exerted. This is the case with two companies<br />
(prior year: two).<br />
The following changes to the consolidated group occurred<br />
in <strong>2010</strong>: the ACW Group was consolidated for the<br />
first time as of July 1, <strong>2010</strong>. The companies Cofresco<br />
RusCom OOO, domiciled in St. Petersburg, Russia, and<br />
Neukölln Spezialpapier NK GmbH & Co. KG, dom iciled<br />
in Berlin, Germany, were founded in December <strong>2010</strong>.<br />
The new companies founded in December were consolidated<br />
for the first time as of December 31, <strong>2010</strong>.<br />
Consolidation methods<br />
The consolidated financial statements were prepared as<br />
at December 31, <strong>2010</strong>. This is the balance sheet date for<br />
all affiliated companies included in the consolidated<br />
accounts.<br />
In the capital consolidation process, the acquisition cost<br />
or balance sheet valuation of the shareholding is offset<br />
against the proportional share of shareholders’ equity<br />
on the date of the initial consolidation. Goodwill is<br />
formed for any resulting differences – insofar as these<br />
cannot be directly attributed to, and depreciated with,<br />
individual asset items – and amortized with an effect on<br />
income. This consolidation method is also used for<br />
investments in associated companies. The assessment<br />
of an amortization period of over five years is based on<br />
the future use of the goodwill, taking into account the<br />
future use of the acquired company.<br />
Investments in associated companies are consolidated<br />
using the book value method. Inter-group trading profits<br />
from transactions with associated companies were<br />
not eliminated.<br />
51
52 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Report</strong> <strong>2010</strong><br />
Debt was consolidated according to Sec. 303 (1) HGB,<br />
while income and expenditure were consolidated pursuant<br />
to Sec. 305 (1) HGB and unrealized results eliminated<br />
in accordance with Sec. 304 (1) HGB.<br />
Accounting and valuation principles<br />
Uniform valuation of assets throughout the Group is<br />
guaranteed by the application of corporate guidelines,<br />
valid for all members of the <strong>Melitta</strong> Group – with the<br />
exception of those companies consolidated using the<br />
equity method. These corporate guidelines correspond<br />
to commercial law regulations.<br />
Intangible assets are valued at cost, while property, plant<br />
and equipment are valued at acquisition or production<br />
cost; they are written down using the straight-line or<br />
diminishing balance method. In addition to direct costs,<br />
production costs also include a proportionate amount of<br />
overhead costs and depreciation. Financial assets are valued<br />
no higher than at acquisition cost, or the lower fair<br />
value. In the case of permanent impairment, fixed assets<br />
are subjected to non-scheduled depreciation.<br />
Inventories are valued at acquisition or production cost.<br />
Raw materials, supplies and merchandise are valued at<br />
the lower of average purchase prices and current values.<br />
Unfinished and finished goods are valued at production<br />
cost, which also includes a reasonable amount of necessary<br />
overhead cost and depreciation. Production costs<br />
are lowered accordingly, should this be necessary to<br />
avoid valuation losses. Suitable allowances are made to<br />
cover inventory risk.<br />
Advanced payments, accounts receivable, other assets<br />
and cash and cash equivalents are carried at their nominal<br />
values or the lower buying rate for foreign currencies<br />
and the lower rate in the case of recognizable risks.<br />
Lump-sum allowances have been made to cover general<br />
credit risks.<br />
Pursuant to Sec. 306 HGB, deferred tax assets and liabilities<br />
are formed for consolidation entries with an effect<br />
on income. Deferred tax assets were formed in accordance<br />
with Sec. 274 HGB for tax loss carryforwards for<br />
which it can be assumed with adequate probability that<br />
they will be used in future, as well as for temporary differences<br />
between the commercial and tax balance sheet,<br />
and were netted with deferred tax liabilities. For the<br />
measurement of deferred taxes, the individual tax rates<br />
of the parent company and the affiliated companies<br />
included in consolidation were considered. The option<br />
pursuant to Sec. 306 Sentence 6 HGB was utilized.<br />
Accruals for pensions are calculated using the projected<br />
unit credit method. Pension accruals are measured with<br />
an interest rate of 5.17 percent as at September 30, <strong>2010</strong>.<br />
There were no significant deviations between interest<br />
rates as at September 30, <strong>2010</strong> and as at December 31,<br />
<strong>2010</strong>. In accordance with the simplifying provision of Sec.<br />
253 (2) Sentence 2 HGB, a standard remaining term of 15<br />
years was assumed for the obligations. Future pay<br />
increases were taken into account at a rate of 3 percent<br />
p.a. Standard consideration throughout the Group was<br />
also given to the relevant biometric calculation basis<br />
(including the RT 2005 G mortality chart) and other calculation<br />
principles for the settlement amount to be used.<br />
Other accruals cover all recognizable risks and uncertain<br />
commitments in the amount of the respective settlement<br />
amount. Accruals with maturities of over one year<br />
were measured in accordance with Sec. 253 (2) HGB.<br />
Subject to the fulfillment of the corresponding prerequisites,<br />
transactions expected with a high level of probability<br />
(hedged items) are placed together with derivative<br />
financial instruments in hedging relationships in order<br />
to balance contrasting value changes or cash flows from<br />
the acceptance of comparable risks. Such hedging relationships<br />
are presented in the financial statements using<br />
the net hedge presentation method.
Financial instruments are measured using generally<br />
accepted valuation models and mathematical procedures<br />
based on current market data.<br />
Liabilities are carried at their current repayment values.<br />
Currency translation<br />
Assets and liabilities denominated in foreign currencies<br />
are translated at the spot rate as of the balance sheet<br />
date, providing there are no hedging transactions.<br />
The balance sheet items of foreign Group companies<br />
were translated at the prevailing rate on the balance<br />
sheet date of December 31, <strong>2010</strong>, while items of the<br />
income statement were translated at average rates for<br />
the year <strong>2010</strong>.<br />
Derivative financial instruments and hedges<br />
The <strong>Melitta</strong> Group uses derivative financial instruments<br />
(forward, option and swap transactions) for hedging pur-<br />
Consolidated Balance Sheet<br />
poses. They are mainly used to hedge against the risks<br />
arising from currency and raw materials transactions<br />
expected with a high degree of probability in the years<br />
2011 and 2012. Responsibilities, controls and the scope<br />
of action with regard to the conclusion and processing<br />
of such financial instruments are defined in binding<br />
internal guidelines.<br />
The market values of the above mentioned financial<br />
derivatives correspond to the price for the dissolution or<br />
replacement of the transactions and are as follows as at<br />
December 31, <strong>2010</strong>:<br />
€ million<br />
Foreign exchange futures – 1.6<br />
Foreign exchange options 6.7<br />
Raw material swaps 3.5<br />
Raw material futures and differentials 2.3<br />
10.9<br />
The effectiveness of hedging relationships is examined<br />
using the critical terms match method. This method is<br />
used as all key valuation parameters of the underlying<br />
and hedging transactions match each other.<br />
53
54 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Report</strong> <strong>2010</strong><br />
2. Fixed assets<br />
in € ’000 12-31-<strong>2010</strong> 12-31-2009*<br />
3. Inventories<br />
Book values as of Additions Depreciation<br />
current year<br />
other<br />
changes<br />
Intangible assets 18,851 15,436 9,322 6,414 507<br />
Tangible assets<br />
Land 95,672 96,263 2,581 4,635 1,463<br />
Machines and equipment 55,847 52,075 11,403 11,327 3,696<br />
Other tangible assets 23,509 18,985 11,424 3,178 –3,722<br />
Financial assets<br />
175,028 167,323 25,408 19,140 1,437<br />
Shares in affiliated companies 1,846 1,846 0 0 0<br />
Participation interests 21,245 21,012 233 0 0<br />
Other financial assets 14,779 940 13,741 0 98<br />
37,870 23,798 13,974 0 98<br />
231,749 206,557 48,704 25,554 2,042<br />
* Differences arising from the currency translation of fixed and other assets at<br />
current rate values are offset against shareholders’ equity or the corresponding<br />
liability items without affecting earnings.<br />
in € ’000 12-31-<strong>2010</strong> 12-31-2009<br />
Europe 106,807 89,231<br />
North America 13,506 11,643<br />
South America 15,441 17,788<br />
Asia 8,111 4,779<br />
143,865 123,441
4. Trade receivables<br />
in € ’000 12-31-<strong>2010</strong> 12-31-2009<br />
Europe 153,738 135,894<br />
North America 9,612 9,499<br />
South America 29,891 25,080<br />
Asia 5,385 3,367<br />
5. Debts<br />
198,626 173,840<br />
in € ’000 12-31-<strong>2010</strong> 12-31-2009<br />
Europe 24,971 10,323<br />
North America 293 32<br />
South America 7,377 10,485<br />
Asia 460 3,004<br />
There are no liabilities due to banks with terms of over five years.<br />
6. Trade payables<br />
33,101 23,844<br />
in € ’000 12-31-<strong>2010</strong> 12-31-2009<br />
Europe 54,262 47,150<br />
North America 5,004 3,463<br />
South America 3,501 2,555<br />
Asia 4,161 2,538<br />
Minden, April 2011<br />
General Partners<br />
of <strong>Melitta</strong> Unternehmensgruppe Bentz KG<br />
66,928 55,706<br />
Consolidated Balance Sheet<br />
55
56 <strong>Melitta</strong> Group <strong>Annual</strong> <strong>Report</strong> <strong>2010</strong><br />
Imprint<br />
Published by<br />
<strong>Melitta</strong> Unternehmensgruppe Bentz KG<br />
Edited by<br />
Public Relations and Corporate Finance<br />
of the <strong>Melitta</strong> Group<br />
Marienstraße 88<br />
32425 Minden, Germany<br />
Phone: +49 571-4046-0<br />
Fax: +49 571-4046-499<br />
E-mail: pr@mbv.melitta.de<br />
Internet: www.melitta.info<br />
Photos:<br />
Ulrich Hartmann, Bielefeld, Germany<br />
foto@andreas-duerst.de, Rostock, Germany<br />
<strong>Melitta</strong> Companies<br />
Concept and Design:<br />
Kirchhoff Consult AG, Hamburg, Germany<br />
Text editing:<br />
Berichtsmanufaktur, Hamburg, Germany<br />
Printing and Production:<br />
Zertani GmbH & Co. Die Druckerei KG, Bremen, Germany<br />
© 2011 <strong>Melitta</strong> Unternehmensgruppe Bentz KG<br />
Online version: www.melitta.info