Annual Report 2003 - Kardex

4
REPORT OF THE BOARD OF DIRECTORS
Other European countries, which posted revenues of CHF
116.2 million/18.9% (previous year CHF 130 million/
23.6%), account for the second-largest portion of overall
revenues. In these markets, the UK and Switzerland
reported below-average performance.
In third place, with a share of CHF 99.4 million/16.2%
(previous year CHF 51.2 million/9.3%), came the Asia/
Pacific Rim region. The efforts and investments made in
Asian markets have had a positive effect on operations
and helped to double profits.
The North, Central and South America market contributed
CHF 35.9 million/5.9% (previous year CHF 51.1 million/
9.3%) towards Group revenues. Difficult times in the
automobile, electronics and mechanical engineering
industries have caused business to stagnate, while the
weak dollar translated into lower revenues and income in
Swiss franc terms.
TRANSACTIONS AND A STANDARDIZED SHARE
Another issue that occupied the Board of Directors of the
Kardex Remstar Group, on which Industrieholding Cham
is also represented, was far-reaching structural change.
With effect from September 30, 2003, the Kardex
Remstar Group sold its 100% interest in Retis Software
AG, Jona, to the company’s largest customer, Stöcklin
Logistik AG, Dornach.
Also with effect from September 30, 2003, Kardex
Remstar took over the remaining 40% interest in Belgianowned
Stow International nv. As in the previous year,
Stow is fully consolidated in 2003, but the minority
interests no longer apply.
Certain transactions were also prepared for finalization
during the first half of financial 2004. As part of major
restructuring, Kardex AG’s main shareholder, Industrieholding
Cham AG, is relinquishing control of Kardex AG.
The simplification of interests in various companies will
generate capital of approximately CHF 61 million for
Tuxedo Invest AG, hitherto the largest shareholder in
Industrieholding Cham AG. Following the merger with
Kardex AG, this capital will be available for the further
development of the Kardex Remstar Group. By way of
preparation for the merger, Kardex will convert its participation
certificates into a standardized share and carry out
a 1:5 split on its bearer shares. This procedure will be
completed by the end of May assuming that the General
Meeting of Tuxedo Invest AG on May 10, 2004, and the
General Meeting of Kardex AG on May 17, 2004, agree
to the proposal. The plan is for Tuxedo stock to be removed
from the listings on June 3, 2004, and for the split
Kardex stock to start trading on the same date. These
transactions, together with the simplified capital structure,
will ensure that the Kardex Remstar Group is once again
an independent, soundly capitalized public company that
is attractive to investors. With around 12% of the capital
stock, Industrieholding Cham will remain a significant
shareholder in Kardex AG. Because of its previous
involvement in both Kardex and Tuxedo, the main shareholder
under the new arrangement, with 16% of the
stock, will be BURU Holding AG.
WELL ON THE WAY TO SUCCESS
The Kardex Remstar Group is adapting its own operations
to the process of global industrialization. It is clear that a
shift is taking place in the world’s manufacturing base
from the traditional industrialized nations towards new regions.
Kardex Remstar’s growth markets are primarily in
Asia and eastern and southern Europe. As part of its
strategy, the Kardex Remstar Group aims to be active on
all the world’s relevant markets, to gain new market
shares and to balance out geographical risk. To achieve
this, Kardex Remstar is aiming for direct distribution and
the provision of services locally. Other factors crucial to
the Group’s success, which differ from one division to
another, are production cost leadership, professional
project management and customized engineering. The
foundations for success are provided by a dynamic range
of advanced systems, developed and manufactured in
the Group’s own facilities. Thanks to the Group’s enormous
potential for innovation, these are continuously
being updated at an ever faster rate.
OUTLOOK
Through judicious use of its newly acquired equity capital,
Kardex Remstar will be able to make a sustainable improvement
to profitability and accelerate the introduction