From <strong>the</strong> SubsidiariesAt <strong>the</strong> foot of <strong>the</strong>BALKANS a new factory<strong>at</strong> <strong>the</strong> service of BERCO TRACK SYSTEMSComplete “turnkey” undercarriage systems:an all-European challenge.The complete systems are actually designedand assembled <strong>at</strong> <strong>the</strong> factories in Copparo,Imola and <strong>the</strong> new Apriltsi branch in Bulgaria.<strong>Berco</strong> Bulgaria was <strong>for</strong>med on <strong>the</strong> 25th of July andwas fully ready <strong>for</strong> oper<strong>at</strong>ion on <strong>the</strong> 1st of October2008, extending <strong>the</strong> <strong>Berco</strong> project on <strong>the</strong> supply ofcomplete systems, which began in October 2007 with<strong>the</strong> purchase of Forteq.The loc<strong>at</strong>ion of <strong>the</strong> newly <strong>for</strong>med branch is Apriltsi,surrounded by <strong>the</strong> Central Balkan mountain chain,just two hours from Sofia with easy access viamotorway and rail.The industrial plant covers a surface area of about30,000 m2, with a main production building of about3,000 m2 and smaller buildings fitted out aswarehouses.The main activity being <strong>the</strong>manufacture of frames,with components from<strong>the</strong> Imola factoriesbeing welded here in<strong>the</strong> Bulgarian branch.Production capacity isabout 500 frames a month.Currently, <strong>the</strong> branch has 35 employees workingunder Managing Director Plamen Peevski.The newly acquired facility has been thoroughlymodernised and restructured in <strong>the</strong>se months,involving, on <strong>the</strong> one hand, <strong>the</strong> buildings, resultingin <strong>the</strong> standardis<strong>at</strong>ion not only of <strong>the</strong> plant, but also<strong>the</strong> administr<strong>at</strong>ive, IT and management processes.The new factory will make <strong>the</strong> newly cre<strong>at</strong>ed <strong>Berco</strong>Track System division more competitive, fur<strong>the</strong>rincreasing production capacity in response to <strong>the</strong>ever more pressing need to respond to <strong>the</strong> demandnot only <strong>for</strong> complete systems <strong>for</strong> excav<strong>at</strong>ors,compact track loaders, asphalt pavers,road planers and rockboring machines,but also <strong>for</strong>w e l d e dstructuressuch asexcav<strong>at</strong>or arms, rotary boxes, loader arms, lowerframes and o<strong>the</strong>r accessory structures <strong>for</strong> earthmoving machines. At a time when manymanufacturers and sub-suppliers have turned toSouth East Asian countries <strong>for</strong> <strong>the</strong>ir main ofsupply of complete steel structures, <strong>Berco</strong> hasdecided to keep its productionbase in Europe, in orderto be able to exercisemore direct controlover <strong>the</strong> entireprocess and face up to<strong>the</strong> challenge fromemerging countries in amore cost-competitive way.With a str<strong>at</strong>egy based on keepingdesign and production closely integr<strong>at</strong>ed, <strong>Berco</strong> isable to guarantee its customers high standards ofreliability in deliveries and manufacturing quality.At just over a year from <strong>the</strong> purchase of Forteq,we can safely say th<strong>at</strong> we’re s<strong>at</strong>isfied: <strong>the</strong> TrackSystems division is fully active, new projects havebeen launched with many o<strong>the</strong>rs in <strong>the</strong> prototypestage and <strong>Berco</strong> engineering is currently workingon a number of new requests.All this is fur<strong>the</strong>r evidence of <strong>the</strong> considerabledevelopment possibilities <strong>for</strong> <strong>Berco</strong> Track Systems.M<strong>at</strong>teo FrabettiAdministr<strong>at</strong>ion DepartmentLuca Bar<strong>at</strong>toniTrack System Division8BN56 > december 2008
From <strong>the</strong> Subsidiaries<strong>Berco</strong> UK: a very intense yearThe British branch has just ended its third financial year, withlots of things achieved and many more plans <strong>for</strong> <strong>the</strong> future.The Christmas period, perhaps morethan any o<strong>the</strong>r, is a time when youlook back and make an assessment of<strong>the</strong> year just ending.Looking back <strong>at</strong> <strong>the</strong> last twelvemonths, we can say th<strong>at</strong> <strong>the</strong>y werereally intensive, highly eventful andlived in two completely differenteconomic contexts: <strong>the</strong> <strong>for</strong>mer full oftrust in a very healthy market (withturnover growing by 30%), <strong>the</strong> l<strong>at</strong>ter -evident as from May - in rapid declineand characterised by an almost verticaldrop in demand.Never<strong>the</strong>less, despite this suddenslowdown, by <strong>the</strong> end of <strong>the</strong> year<strong>Berco</strong> UK had achieved a turnover of51 million euros, in line with 2007,with a growth in profit over <strong>the</strong>previous year. The organis<strong>at</strong>ionalstructure grew as well, rising to 25units, and work was done onoptimising internal structures andimproving assembly line productivity(getting up to <strong>the</strong> r<strong>at</strong>e of 12 trackchains a shift).Gre<strong>at</strong> ef<strong>for</strong>ts were also put intomaintaining <strong>the</strong> excellent standards ofservice to <strong>the</strong> two main customers,with <strong>the</strong> <strong>at</strong>tainment of <strong>the</strong> Kom<strong>at</strong>suUK’s prestigious “Supplier of <strong>the</strong> Year”award.NEW PREMISESThe most important project of <strong>the</strong> yearwas undoubtedly <strong>the</strong> move to newpremises in Spennymoor, near Durham.With <strong>the</strong> rental contract on <strong>the</strong>Middlesbrough building about toexpire, <strong>the</strong> search began <strong>for</strong> biggerpremises (about 14,000 m2), bigenough above all to housenew track chain assemblyand complete frame subassemblylines, because<strong>the</strong>se are <strong>the</strong> activities th<strong>at</strong><strong>Berco</strong> UK is banking on toincrease its business in <strong>the</strong>years to come.After completing <strong>the</strong>bureaucr<strong>at</strong>ic necessities(contract, permits, etc.),work began <strong>at</strong> <strong>the</strong> end of’07 on fitting out <strong>the</strong>building, with jobs such <strong>the</strong>install<strong>at</strong>ion of two bridgecranes and a paint boothand <strong>the</strong> electricity, gas andcompressed air circuits, etc.This work went on <strong>for</strong> fivemonths.The office move was done <strong>at</strong><strong>the</strong> beginning of May, and<strong>the</strong> goods and stock movebegan in May and lasted 4-5weeks, with no interruptionin <strong>the</strong> flow of deliveries tocustomers.On <strong>the</strong> 18th of July we werefinally able to celebr<strong>at</strong>e <strong>the</strong>reloc<strong>at</strong>ion to <strong>the</strong> newpremises with a <strong>Berco</strong> UKOpen Day.This began in <strong>the</strong> morningwith a press conference,followed by an inaugur<strong>at</strong>ionceremony and an officialpresent<strong>at</strong>ion. Guests were<strong>the</strong>n shown round <strong>the</strong>factory, followed by <strong>the</strong>customary toast.Numerous customers,suppliers, friends and local authoritiestook part in <strong>the</strong> event, including localMP Helen Goodman, <strong>the</strong> guest ofhonour.In <strong>the</strong> afternoon, after <strong>the</strong> guests hadleft, it was <strong>the</strong> turn of <strong>the</strong> employeesand <strong>the</strong>ir families, <strong>the</strong>y too having <strong>the</strong>chance to have a look round <strong>Berco</strong> UK.FUTURE PROJECTSAlthough <strong>the</strong> difficult economicsitu<strong>at</strong>ion and continuous talk of <strong>the</strong>recession hitting Europe and Americaleave little room <strong>for</strong> optimism,never<strong>the</strong>less, <strong>at</strong> <strong>the</strong> same time,difficult periods are a unique occasionto look <strong>for</strong> new stimuli, discoveruntapped resources and develop newideas and projects to lay <strong>the</strong> basis <strong>for</strong>strong future growth.Despite <strong>the</strong> drop in sales, <strong>Berco</strong> UK hasredoubled its ef<strong>for</strong>ts and is working onnumerous projects, both internal (suchas <strong>the</strong> ISO 9001, ISO 14001, OHSAS18001 and Investor in People qualitycertific<strong>at</strong>ion schemes), and external(such as, in particular, <strong>the</strong>development of <strong>the</strong> aftermarket and<strong>the</strong> supply of complete frames <strong>for</strong>mobile crushers and screens).The challenges are ambitious, but <strong>the</strong>enthusiasm and dedic<strong>at</strong>ion of <strong>the</strong><strong>Berco</strong> UK team are bound to achieves<strong>at</strong>isfactory results in <strong>the</strong> near future.Giovanni MichelettoGeneral Manager, <strong>Berco</strong> UKBN56 > december 20089