Value added.

Seeking new shores
Message of the Chairman of the Board of Directors
For the third time in a row since I took responsibility for AFG Arbonia-Forster-Holding AG
I can report on a successful financial year. In 2005 we made further progress in developing
the group in line with our strategy, coming a major step closer to our goal of being a “one
building, one stop provider” among the classic construction industry suppliers.
One of the cornerstones of this strategy is the complementary nature of our product
range. Quality, the ability to innovate and proximity to the market are also part of this strategy.
AFG’s products have always stood out in terms of quality and innovation. And in the last three
years we have given high priority to more effective coverage of existing markets and the penetra-
tion of new ones. In the current international environment, even high-quality, innovative products
cannot sell themselves.
On the importance of brands and labels
Branding plays an increasingly important role in the internationalisation of our business.
Creating a product personality can be a decisive factor in gaining access to certain distribu-
tion channels or getting a good price for our products. Only products with a high degree of
credibility in terms of their quality and origins in the broadest sense have a chance of suc-
ceeding in the market without their price being eroded too seriously.
Seen from this perspective, the acquisition of both Bruno Piatti AG and EgoKiefer AG
did a great deal to establish AFG’s Arbonia-Forster-Holding AG image in the market as a supplier
of quality products. But in 2005 we were also able to seize a unique opportunity with the acqui-
sition of Miele Kitchens. Miele as a company is one of the leading international household equip-
ment brands, and has an outstanding image in terms of quality and innovation. The addition of
Miele Kitchens to the Kitchens and Refrigeration Division has considerably boosted the reputation
of AFG as a whole, reinforcing the market’s perception of the quality of AFG’s product portfolio.
Miele Kitchens will be manufactured by our new subsidiary Warendorfer Küchen GmbH, and
marketed worldwide.
In taking over Miele Kitchens we not only acquired a brand, but gained access to a
global distribution network of enormous importance. We now have a firm foothold in around 50
markets via distribution channels and, in some cases, actual points of sale. This marks an important
– and given that it happened within one year, a unique – step forward in our efforts to internationalise
our business.
8