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Wilo Group, Germany
COMPANY WATCH
Roper Industries Inc, USA Key Figures (US$ million) Three months ended 31.3 2009 505.4
Wilo Group, Germany Key Figures (E million) Year ended 31.12 2008
2008
Net Sales Of Which: Industrial Technology
543.0
130.6
173.7
Cost of Sales
254.3
266.6
Gross Profit Of Which: Industrial Technology
251.1
276.4
62.7
84.7
Turnover 977.2 Of Which: Heating and Air Conditioning 569.2 Water Supply and Sewage Treatment 381.6 Other Segments 26.4 Cashflow from Operating Activities R&D
2007 927.3 545.8 357.2 24.3
118.5
40.5
34.5
27.6
Selling, General and Admin Expenses 164.3
168.1
EBIT
88.6
99.4
Income from Operations
86.8
108.3
EBITDA
116.5
128.5
Net Earnings
51.6
62.5
Number of Employees
6024
5821
471.6
558.0
139.4
185.0
Net Orders Of Which: Industrial Technology
COMMENT Roper Industries Inc’s sales in the first quarter were US$505 million, a 6.9% decrease over the same period in 2008, which includes a 6.8% increase from acquisitions, a 10.5% decline in organic growth and a negative 3.2% impact from foreign currency. Operating margin was 17.2%, or 17.9% excluding restructuring charges. Net earnings for the first quarter were US$52 million, down from US$63 million a year ago. “We are pleased with the performance of our businesses and their ability to stay ahead of the curve in this difficult economy,” said Brian Jellison, Roper’s chairman, president and CEO. “Our 50% gross margin demonstrates the value of our products and services to our customers. At the same time, the nimbleness of our leadership teams enabled us to successfully navigate lower order and sales levels in the quarter. We were
June 2009
able to achieve strong margin performance as a result of our lean cost structure and restructuring actions taken in 2008 and the first quarter of 2009.” Roper’s orders declined 15% in the quarter to US$472 million, reflecting decreased order activity particularly in the Industrial Technology and Energy Systems and Controls segments. “Although we currently expect second quarter orders to reflect a decline over the prior year, orders and quote activity in March and early April give us confidence that we will see second quarter orders improve meaningfully over the first quarter,” added Jellison. The company continues to generate significant cash flow. “The acquisition pipeline remains full and we are in a strong position to deploy capital in our disciplined manner,” said Jellison. ■ www.roperind.com
COMMENT Despite the financial crisis and the recession, the Wilo Group continued its growth trend in 2008 achieving what it describes as “extremely satisfactory results”. The Dortmund, Germanybased pump manufacturer delivered organic growth of 5.4%, which led to a new record turnover of E977.2 million. Cash flow from operating activities increased by E78.0 million to E118.5 million on 2007 levels, while EBIT was down 10.9 % to E88.6 million. Employee numbers increased by 3.5% to an average of 6024 during 2008. In Western Europe, turnover rose 4.5% on average. In the domestic German market the strong demand for energyefficient heating pumps resulted in an 8.8% increase in sales to E197.3 million. Business development in France, the second most important national market for Wilo, was also strong, with turnover increasing 7.3% to E112.5 million. In Asia, the group achieved a slight increase in turnover, despite a 14.2% decrease in turnover in South Korea. Eastern Europe saw an 8.0% gain in turnover. Speaking at the company’s annual press conference on 19 May 2009, Oliver Hermes, the
member of the Wilo board for Finances, Controlling and Human Resources, said that the group could not completely avoid the negative effects of the global financial and economic crisis. Wilo experienced decreased demand in a number of different sales markets and the weakening of some important currencies for the company, especially the South Korean won, the US dollar and the British pound. The company also had to cope with rising raw material prices until the third quarter of the year. R&D investment increased by 25% in 2008 to E34.5 million, reaching 3.5% of group turnover. During the year, product innovation focused on the completion of the WiloGeniax decentralised pump system, which saves on average 20% of heating energy compared with conventional central heating installations. Extensive successful field tests were carried out in a large number of different buildings prior to the market launch in spring 2009. Investments in the Heating and Airconditioning segment in 2008 focused on the extension and optimisation of the WiloStratos high-efficiency series. www.wilo.com
Pump Industry Analyst
9
Roper Industries Inc, USA Key Figures (US$ million) Three months ended 31.3 2009 505.4
Wilo Group, Germany Key Figures (E million) Year ended 31.12 2008
2008
Net Sales Of Which: Industrial Technology
543.0
130.6
173.7
Cost of Sales
254.3
266.6
Gross Profit Of Which: Industrial Technology
251.1
276.4
62.7
84.7
Turnover 977.2 Of Which: Heating and Air Conditioning 569.2 Water Supply and Sewage Treatment 381.6 Other Segments 26.4 Cashflow from Operating Activities R&D
2007 927.3 545.8 357.2 24.3
118.5
40.5
34.5
27.6
Selling, General and Admin Expenses 164.3
168.1
EBIT
88.6
99.4
Income from Operations
86.8
108.3
EBITDA
116.5
128.5
Net Earnings
51.6
62.5
Number of Employees
6024
5821
471.6
558.0
139.4
185.0
Net Orders Of Which: Industrial Technology
COMMENT Roper Industries Inc’s sales in the first quarter were US$505 million, a 6.9% decrease over the same period in 2008, which includes a 6.8% increase from acquisitions, a 10.5% decline in organic growth and a negative 3.2% impact from foreign currency. Operating margin was 17.2%, or 17.9% excluding restructuring charges. Net earnings for the first quarter were US$52 million, down from US$63 million a year ago. “We are pleased with the performance of our businesses and their ability to stay ahead of the curve in this difficult economy,” said Brian Jellison, Roper’s chairman, president and CEO. “Our 50% gross margin demonstrates the value of our products and services to our customers. At the same time, the nimbleness of our leadership teams enabled us to successfully navigate lower order and sales levels in the quarter. We were
June 2009
able to achieve strong margin performance as a result of our lean cost structure and restructuring actions taken in 2008 and the first quarter of 2009.” Roper’s orders declined 15% in the quarter to US$472 million, reflecting decreased order activity particularly in the Industrial Technology and Energy Systems and Controls segments. “Although we currently expect second quarter orders to reflect a decline over the prior year, orders and quote activity in March and early April give us confidence that we will see second quarter orders improve meaningfully over the first quarter,” added Jellison. The company continues to generate significant cash flow. “The acquisition pipeline remains full and we are in a strong position to deploy capital in our disciplined manner,” said Jellison. ■ www.roperind.com
COMMENT Despite the financial crisis and the recession, the Wilo Group continued its growth trend in 2008 achieving what it describes as “extremely satisfactory results”. The Dortmund, Germanybased pump manufacturer delivered organic growth of 5.4%, which led to a new record turnover of E977.2 million. Cash flow from operating activities increased by E78.0 million to E118.5 million on 2007 levels, while EBIT was down 10.9 % to E88.6 million. Employee numbers increased by 3.5% to an average of 6024 during 2008. In Western Europe, turnover rose 4.5% on average. In the domestic German market the strong demand for energyefficient heating pumps resulted in an 8.8% increase in sales to E197.3 million. Business development in France, the second most important national market for Wilo, was also strong, with turnover increasing 7.3% to E112.5 million. In Asia, the group achieved a slight increase in turnover, despite a 14.2% decrease in turnover in South Korea. Eastern Europe saw an 8.0% gain in turnover. Speaking at the company’s annual press conference on 19 May 2009, Oliver Hermes, the
member of the Wilo board for Finances, Controlling and Human Resources, said that the group could not completely avoid the negative effects of the global financial and economic crisis. Wilo experienced decreased demand in a number of different sales markets and the weakening of some important currencies for the company, especially the South Korean won, the US dollar and the British pound. The company also had to cope with rising raw material prices until the third quarter of the year. R&D investment increased by 25% in 2008 to E34.5 million, reaching 3.5% of group turnover. During the year, product innovation focused on the completion of the WiloGeniax decentralised pump system, which saves on average 20% of heating energy compared with conventional central heating installations. Extensive successful field tests were carried out in a large number of different buildings prior to the market launch in spring 2009. Investments in the Heating and Airconditioning segment in 2008 focused on the extension and optimisation of the WiloStratos high-efficiency series. www.wilo.com
Pump Industry Analyst
9