Annual Report 2012 Full version PDF Download - Bekaert

19 Asia Pacific
Bekaert Annual Report 2012
Asia Pacific
Asia Pacific/China
Bekaert’s activities in China came under pressure due to
these developments. The most sudden and tangible
impact was felt in the sawing wire business as of the
second half of 2011. The price levels of sawing wire
further declined significantly in 2012 as a result of the
huge manufacturing overcapacity that had been built up
in a very short time. Bekaert realigned its manufacturing
footprint in China with the new business reality through a
drastic restructuring and considerable asset impairments.
In automotive markets too, Bekaert experienced increased
competition and maturing demand from Chinese tire
producers targeting export markets. Truck tire customers in
particular suffered from less export business. Bekaert
defended its rubber reinforcement markets and succeeded
in obtaining modest growth in sales volumes compared to
2011, while price and margin levels were under pressure
due to the highly competitive environment and declining
raw materials prices.
Continued growth through acquisition
Combined sales:
Consolidated sales(*):
Capital expenditures (PP&E)(*):
Total assets(*):
€ 998 million
€ 945 million
€ 48 million
€ 1 359 million
Employees: 11 800
(*) Consolidated entities
China: economy in transition
After a long period of double-digit growth rates, China’s
GDP growth ended below 8% in 2012, further down from
9% the year before. Investments in the country have
slowed down as a result of measures for more controlled
growth, while the global economic crisis tempered China’s
export growth. Combined with a maturing domestic
demand in certain sectors, this led to manufacturing
overcapacity and fierce competition in several industrial
markets.
Bekaert acquired the Qingdao Hansun steel wire plant in
Qingdao (Shandong Province) from Hankuk Steel Wire Co.
Ltd (South Korea) in September 2011. The operations
were fully integrated in the Bekaert China manufacturing
platform during 2012. Bekaert (Qingdao) Wire Products
Co., Ltd produces a wide range of wires and ropes serving
construction and mining markets as well as the hoisting
equipment and paper industry.
In December of 2011 Bekaert and Xinyu Iron & Steel Co.
Ltd (Xinsteel) announced the closing of their partnership
transaction by which Bekaert acquired 50% of the spring
wire and Aluclad activities of Xinsteel in Xinyu (Jiangxi
Province). The results of the joint venture have been
included in Bekaert’s financial records under the equity
accounting method as from 1 December 2011. In 2012,
the ground works for the construction of a new plant,
Bekaert (Xinyu) New Materials Co., Ltd, were started. The
new building will house the spring wire manufacturing
activities which are now located in two separate factories.
The new plant is expected to come into operation in the
second half of 2013, and will serve domestic customers
mainly, with spring wires for various applications.
Bekaert and Xinsteel broke
ground for a new
production plant in Xinyu.