annual report - Kendrion

Report of the Board
Targets and objectives
>> Continued focus on key issues
2011 was a great year for Kendrion. After
strong revenue growth of 43% in 2010, so
soon after the crisis in 2008/2009, 2011
also showed further organic growth of 21%
in all areas. The objectives Kendrion’s Board
had formulated and agreed to focus on as
from 2009 continued to prove their worth in
2011. Kendrion’s objectives in 2011 were:
z Actively respond to developments in all
key markets;
z Increase flexibility of staffing and costs;
z Further globalisation;
z Enhance capacity for innovation;
z Improve sustainability;
z Further improve working capital
management;
z Continue to strengthen risk
management.
Kendrion can conclude that the specific
steps taken to attain these objectives have
largely achieved the desired results.
Actively respond to developments
in all key markets
To be able to respond to developments
in the company’s key markets and to
respond satisfactorily to Kendrion customer
problems, the company worked hard to
strengthen the engineering staff in its
business units. Furthermore, Kendrion paid
considerable attention in 2011 to the issue
of market segmentation. The sales and
engineering teams in each of Kendrion’s
business units are to focus on the
development of specific market segments,
such as the machine equipment market or
the medical market, and increase their
market intelligence.
Increase flexibility of staffing and costs
The major lesson learned in the last few
years has been that flexibility in all areas
and at all levels is essential to Kendrion’s
development and growth. Kendrion strongly
believes that those companies which best
adapt to rapidly changing circumstances
will be the ones which win out in the future.
For this reason, Kendrion is endeavouring to
incorporate flexibility of between 20% and
30% into its total cost structure (staffing
costs and other operating expenses) and
continually assesses every opportunity
and option available for achieving that
flexibility. In addition, Kendrion’s suppliers
need to be managed in such a way as to
enable them to respond rapidly to
developments in the company’s market
segments. Kendrion therefore is making
considerable efforts to select appropriate
strategic suppliers for the longer term, as a
means of increasing flexibility in the future.
The company monitors the flexibility of
each business unit every quarter. Flexibility
will remain an extremely important topic
in 2012, when Kendrion expects its markets
to be volatile once again.
Further globalisation
The world is Kendrion’s marketplace. In the
Americas, future growth will be supported
by the acquisition of FAS Controls, Inc. in
Shelby, North Carolina, USA, in late
December 2011. This company will further
enhance the activities of the Passenger Car
Systems business unit. Kendrion expects
that this increased foothold in the USA will
support the company in its intended growth
in this country, also sustained by new,
recently acquired projects.
Kendrion will further strengthen its
position, not only by monitoring business
opportunities in existing markets but also
by focusing even more closely on emerging
markets. In 2011, Kendrion launched
a greenfield operation in Pune, India.
The company achieved rapid expansion
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annual report 2011