Annual Report 2005

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14 Market Strategy NESCHEN AG has had a consistent corporate sales strategy for many years, thereby displaying its continuity even under difficult, changing market conditions. This strategic goal includes the development of niche markets within the business units “Graphics”, “Documents” and “Special Products”. The business units “Graphics” and “Documents” are characterised by their comprehensive product range from our own production and merchandise, the focus on the core competences in production and marketing as well as the company’s international market presence. Within our strategic framework, our actions are governed by the following principles: • All products are manufactured to the highest standards of quality and undergo continuous inspection • Rapid product availability is guaranteed via our own companies or agents • Coordinated product systems are marketed for specific customer applications • The ongoing development and marketing of new products is implemented The core business unit “Documents” has been supplemented by products for the end consumer market whereby the product structure and production procedures have utilised the synergy of existing product families for professional users. Marketing is carried out by wellknown brand companies which have access to the appropriate distribution channels. Special medical products and various industrial applications are also manufactured and marketed within the business unit “Special Products”. Coating is also carried out. Turnover for these products currently amounts to about 4% of the total turnover. This sector will be continuously expanded over the next few years focusing on the countries in which we have production plants, i.e. Germany, England and the USA.
Restructuring Program In March 2005, the Executive Board of Directors and the Supervisory Board decided on a restructuring program. The decision was preceded by a comprehensive analysis of the market situation as well as the business processes and cost structures at all of the sites. The company engaged the support of external consultants. The objective of the program was the quick and sustained reduction of material and personnel expenses as well as the extensive consolidation of business activities. All the measures were concluded within twelve months. The measures have cut annual costs throughout the group by approximately 7 million Euros. The one-time expenditure for the restructuring has affected results in 2005 and came to approximately 7.9 million Euros (4.5 million Euros for personnel expenses and 2.1 million Euros for depreciation as well as other costs amounting to 1.3 million Euros). In 2003 and 2004, the technical and organisational basis was created for adapting processes, structures and sites in the NESCHEN Group to market developments. The sustained further massive reduction of personnel expenses and material costs was only possible within the framework of a comprehensive restructuring program which included the merging of sites. The measures which began in March 2005 have primarily affected NESCHEN AG and SEAL companies. The measures included: NESCHEN AG site, Bückeburg In 2005, the number of staff at the headquarters in Bückeburg was reduced by 49 (approximately 15%) to 268 (31.12.2005). The staff cutbacks were made across virtually all of the company divisions and business units. This was made possible by a number of individual measures: • Reduction of the product portfolio • Centralisation of raw materials • Merging of departments in the Management and Sales divisions • Changing of business processes • Closure of the Archive Centre in Kornwestheim and relocation of activities to the Archive sites in Berlin and Brauweiler As a result, business processes, productivity and efficiency have been significantly improved. After staff cutbacks were implemented successfully, logistics and customer service activities at 15
Page 1: Annual Report 2005
Page 4 and 5: 4 Financial Overview HGB IFRS IFRS
Page 6 and 7: 6 Neschen AG · Consolidated Compan
Page 8 and 9: 8 Foreword by the Spokesman for the
Page 10 and 11: 10 Foreword by the Spokesman for th
Page 12 and 13: 12 Business Units NESCHEN AG has le
Page 16 and 17: 16 Restructuring Program the site o
Page 18 and 19: 18 Business Unit “Graphics” The
Page 20 and 21: 20 Business Unit “Graphics” The
Page 22 and 23: 22 Business Unit “Documents” Th
Page 24 and 25: 24 Business Unit “Special Product
Page 26 and 27: 26 Quality Management During the pa
Page 28 and 29: 28 Corporate Governance Code With t
Page 30 and 31: 30 Report of the Supervisory Board
Page 32 and 33: 32 Course of business and Group’s
Page 34 and 35: 34 Profit and Loss Statement During
Page 36 and 37: 36 Profit and loss statement The re
Page 38 and 39: 38 Cash Flow Cash flow as of 31/12
Page 40 and 41: 40 Personnel development As of 31.1
Page 42 and 43: 42 Forecast We plan to achieve sale
Page 44 and 45: 44 Research and Development Approxi
Page 46 and 47: 46 Outlook The past year - 2005 - h
Page 48 and 49: 48 Consolidated balance sheet Conso
Page 50 and 51: 50 Notes relating to the consolidat
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64 Notes relating to the consolidat
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78 Neschen AG balance sheet (in acc
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80 Income statement of Neschen AG F
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82 Imprint Imprint The Annual Repor
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Annual Report 2005

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