High flyers MIT Quarterly - MIT Munich Industrial Technologies AG

01/12
MIT Quarterly
Business Journal of MIT Munich Industrial Technologies AG
High flyers
Industrial companies on the up
Content News
Editorial: Crisis?
What crisis?
Positive news on Germany as a
business location (page 2)
Portrait: New business
fields for Royal Aero
Fleet management should further
boost the Miesbach company’s
profitability (page 3)
On your bikes!
NCTE expands with sensor
technology for e-bikes (page 4)

2
Editorial
Crisis? What crisis?
We are assailed almost daily by dire reports about the global economic crisis and its impact.
However, the German automotive industry is more successful than ever before.
6,000,000
5,000,000
4,000,000
It’s just incredible: wherever you look there’s a crisis. The world is speculating about
the euro crisis and Greece’s debts, Der Spiegel has dubbed China a limping giant,
and the USA is still struggling to get to grips with its record national debt.
In short, if the newspapers are to be believed, things are looking far from rosy. But
there’s another side to the story – the economic one, which should be represented
not by some arbitrary industry but by the most important one. In a 2009 study on the
Importance of the car industry for the German economy in the European context, the
Center for European Economic Research stressed that “carmaking is thriving within
the German manufacturing sector. Viewed in absolute categories, it leads the pack
in employment, added value, investments, exports/imports, direct investments and
innovative activities such as research and development.”
Business News
Car production in Germany
5.1 Mio.
2002
5.1 Mio.
2003
5.2 Mio.
2004
“If leading German newspapers continue to talk
of a major crisis, they will eventually conjure up
a real one.“
5.4 Mio.
2005
5.4 Mio.
2006
5.7 Mio.
2007
5.5 Mio.
2008
5.0 Mio.
2009
5.6 Mio.
2010
Photo left: Rüdiger C. Olschowy,
Managing Director of MIT
Photo right: Ralf G. Schöpker,
Managing Director of MIT
5.9 Mio.
2011
In concrete terms, this means that “7.7
percent of total added value in Germany
is created by the automotive industry,
of which 4.9 percent is accounted for
by indirect effects. The industry’s total
contribution to added value in Germany
is thus almost twice that in the next
best-performing European countries and
Japan. […]”
If you look at car manufacturing and the
sectors that are dependent on it – from
the steel industry to plant and machinery
construction – the surprising conclusion
is that there is no crisis and that in fact
we are on an economic roll that puts
everything that has gone before in the
shade. This is the case not just for major
corporations but also for a large percentage
of German SMEs. Thus, all German
car manufacturers in 2011 achieved historically
unparalleled results. Porsche,
for instance, is selling more cars than
ever before and sees 2011 as one of the
most successful years in the company’s
history. VW has set an absolute record
with over eight million vehicles sold in
2011. And the BMW Group also ended
the 2011 financial year with the best results
in its history. It is hardly surprising
then that in 2011 Germany’s GDP rose
by 3 percent on the previous year.
This clearly shows that while we in
Germany wallow in glum newspaper
articles about crises and catastrophes,
our industrial companies are earning
handsomely.
At least at the moment – because media
coverage that continues to harp on about
the collapse of Europe will gradually
create economic uncertainty and all
that goes with it. Carmakers are still announcing
robust sales figures to their
suppliers, and suppliers should now be
investing in order to supply the projected
volumes in the mid-term. But if leading
German newspapers continue to talk of a
major crisis, they will eventually conjure
up a real one.
The average unemployment rate in 2011
was 7.1 percent, the lowest since 1981,
and the downward trend is continuing.
Unemployment in January was 7.9 percent
lower than in the same month of
the previous year. It is now high time
that the media recognizes the signs of
the times and starts reporting something
positive about Germany as a business
location again.
MIT Quarterly 01/12

Portrait
New business fields for Royal Aero
The company plans to grow through the development of its Technology and Leasing divisions, consolidation of its three business
fields in Royal Aero GmbH and expansion of its service portfolio
Royal Aero offers its customers comprehensive services – from complete life-cycle management to the financing
of aircraft components
Safety is probably the most crucial criterion that an aircraft must meet so that passengers
feel confident while flying. Planes and trains are indeed the safest modes of
transport overall thanks to regulations that specify, for instance, how long engines and
other aviation components are allowed to be kept in service.
Royal Aero steps in at the latest when an engine has reached the end of its life cycle.
The company specializes in the sourcing, processing and sale of high-quality parts for
the aeronautic industry, especially assemblies and replacement parts for the turbine
engines installed in modern wide-bodied aircraft. This enables Royal Aero to supply
its customers with original replacement parts that meet the very highest quality standards
and are also available quickly and cost-efficiently.
Although this business field is profitable, growing competition means that it is becoming
increasingly less attractive for Royal Aero, which relies on strong growth.
The company is therefore now concentrating on expanding its other two divisions:
Technical and Leasing.
The Technical Division advises and supports customers in all matters relating to the
maintenance and repair of engines throughout their life cycle. The engine specialists
at Royal Aero ensure, for example, that the turbines they service are overhauled on
schedule to minimize downtime and maximize cost-efficiency.
Royal Aero’s Leasing Division leases turbines to airlines. Leasing offers the advantage
that the airline retains more liquidity than would be the case if it had to
purchase the turbines outright. Because capital is not tied up in the long term, they
are able to adapt flexibly to changing market conditions.
To bundle its services and products efficiently and simplify dealings with customers,
Royal Aero merged its three business units Royal Aero Services GmbH, Royal Aero
Leasing GmbH and Royal Aero Technical GmbH into a single company, Royal Aero
GmbH, at the beginning of 2012. For customers who draw on services from several
divisions, the advantage is that they now have just one contact and can access all
the services and products quickly and easily. The resulting interactions and closer
cooperation between departments should further boost the company’s profitability.
Apart from the reorganization, Royal Aero
has also decided to expand its service
portfolio in order to consolidate its strong
position on the market.
Thanks to its extensive technical and
commercial expertise, the Miesbachbased
company advises airlines on the
purchase of engines and aircraft. For example,
Royal Aero recently advised Cebu
Pacific about the purchase of engines
for its Airbus fleet and offers the same
service to other airlines. Because Royal
Aero does not work on behalf of a single
manufacturer, the Miesbach specialists
are able to advise their customers independently
across all makes and models.
Royal Aero is developing into a serviceoriented
company in other areas as well.
“We cover the entire life - cycle management
of aviation components. At the
same time we offer suitable financial
solutions,” explains Calum MacLeod,
Royal Aero’s founder and managing
director. “In this way we should be able
to continue the strong growth and high
profitability of recent years.”
MIT AG has had an indirect stake in Royal
Aero Group GmbH through its Gulf One
BIT Fund since 2007. “We are delighted
by Royal Aero’s performance,” confirms
Martin Dötterl, investment manager and
partner at MIT and member of Royal
Aero’s Advisory Board.
Aircraft turbines: the core business of Royal Aero
MIT Quarterly 01/12 3

4
News
New MIT team member
Martin Dötterl is a new investment
manager and partner
The new face at MIT: Martin Dötterl
Martin Dötterl, who has a masters degree
in business administration, joined the
Munich Industrial Technologies team as
an investment manager and partner in
June 2011. He is an ideal addition to MIT
thanks to his experience as an accountant
and management consultant.
Before moving to MIT, Martin Dötterl
worked for six years in the Transaction
Advisory Services Department of the
accountancy firm Ernst & Young in Munich,
where he advised national and international
industrial and private equity companies.
During his time at Ernst & Young
he successfully completed his professional
examinations as a tax consultant
and public accountant.
His duties include supporting the development
of Happy Plating. Martin Dötterl is
also on the Advisory Board of Royal Aero.
Publishing details
Edition:
Published quarterly
Next edition:
June 2012
Published by:
MIT Munich Industrial Technologies AG
Rüdiger C. Olschowy
Grünwalder Weg 13 a · 82008 Unterhaching
www.mit.ag
On your bikes!
NCTE expands with sensor technology for e-bikes
In e-bikes and pedelecs a torque sensor integrated in the bottom bracket measures rotational speed, rotational
direction and torque. With the help of these data the sensor can then calculate how hard the rider is pedaling and
how much power the motor has to deliver.
Some people may still remember Theo
de Rooij as a bicycle racer or as the manager
of the Radobank cycling team.
Today the Dutchman is first and foremost
a highly successful entrepreneur who set
up TDR, a company that manufactures
e-bikes and pedelecs. At Eurobike 2011
he introduced the TDR FluxX pedelec,
whose motor is integrated into the seat
tube and the bottom bracket. De Rooij’s
bike immediately won a Eurobike award.
NCTEngineering GmbH has played a
key role in the success story of TDR. It
supplies the company with noncontact
torque sensors, which TDR then fits to
the gear axles of its electric bikes. The
sensors measure how much energy the
motor must deliver to maintain the cyclist’s
pedaling force at a constant level.
NCTE now has a new client in TDR, which
is well on the way to establishing itself in
a growing market. The company will introduce
its first bicycles on the market in
Design /editing:
Compass Communications GmbH
Dr. Perry Reisewitz
Theresienstrasse 12 · 82319 Starnberg
www.compass-communications.de
Graphic Design /layout:
Annette Fischer · visualign
Schmellerstrasse 21 · 80337 Munich
www.visualign.de
Printed by:
Offsetdruck Schwarz
Rohrauerstrasse 70 · 81477 Munich
March. Initially 200 retailers in Holland,
Belgium and Switzerland will be supplied
with models for their showrooms. Next
year TDR aims to sell 1,500 e-bikes and
pedelecs. By then the electric bikes will
also be available in Germany. The company
plans to sell 5,000 bikes in 2014.
NCTE supplies other renowned clients
apart from TDR. Hence, the sales figures
for torque sensors are rising steadily.
15,000 units were produced after production
of sensors for the e-bike sector
was ramped up last year. The company
plans to deliver some 60,000 sensors in
2012. By 2015 NCTE expects the company
to sell up to 400,000 units – provided
that the e-bike market develops in line
with manufacturers’ forecasts.
Thus, plans to develop NCTE into an
industrial company have paid off. The
company’s entry into large-scale production
for various major manufacturers has
enabled the NCTE team to produce significant
volumes of torque sensors.
One of the success factors of NCTE
GmbH in Unterhaching is undoubtedly the
stake in the company held by MIT Munich
Industrial Technologies AG through the
Gulf One BIT and Gulf One MIT funds.
Following the company’s establishment
in 2004 and MIT’s investment in it in
2007, NCTE achieved a profit for the first
time in 2010.
Since the forecasts are good, MIT is not
contemplating selling the company just
yet. At present, nothing stands in the way
of further exponential growth at NCTE
and not just with its e-bike sensors.
MIT Quarterly 01/12