Technologies · Systems · Solutions - Dürr

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From the project launch to the end of the year 2004, achieved cumulative savings
amounted to about € 105 million as planned. In line with the distribution of sales
within the Group, Paint Systems made the largest contribution to savings – about 50%.
Around 20 to 30% of the savings achieved found direct expression in earnings. We have
used the rest to compensate for the continuing erosion of prices and the unscheduled
expenses in Ecoclean and Final Assembly Systems. The program is of central
importance to the Group because its measures have enabled us to improve our competitiveness
in a difficult market environment.
The most important measures implemented since the beginning of 2004 are as follows:
Cutting costs
Consistent product standardization has allowed us to improve our cost position significantly.
For example, Paint Systems lowered production costs across all painting technology
products by another 6% on average in 2004. The second key area is purchasing.
We have pushed forward with the establishment of purchasing offices in low-cost
procurement markets. We are also using lead buyers who work across the different
business units to manage the purchasing of key product groups and coordinate
cooperation with large suppliers who operate globally. Finally, we have adjusted our
personnel capacities to the market environment. In 2004, the number of employees
in continuing operations was reduced by 4.7%.
Reducing risks
We consistently improved our key processes to limit earnings risks in the area of order
handling. For example, with the Project Information Tool (PIM), we set up a database
with which our project managers can closely track deadline and cost developments.
We also developed and launched a new risk management manual for the Group.
Net working capital management
We have stepped up receivables and inventory management in all business units.
The results were a decline of receivables in continuing operations by 9.1% and of
inventories by 10.9% in 2004.
Location and portfolio consolidation
In the process of reshaping the Group’s structure, we have pushed forward with
streamlining our network of locations. In the United States, we combined five companies
belonging to the new Paint and Assembly Systems division at the beginning of
2005 and placed them under uniform management. Parallel to that, we have eliminated
various company and brand names. Two companies in France were already combined
in 2004, and there are plans to combine five more in Germany. In the Ecoclean business
unit, which belongs to the Measuring and Process Systems division as of March 1,
2005, four US companies were combined at the end of 2004. The sale of the Services
business unit will further reduce the complexity of our company structure.