ABS: Annual Report 2000

Invoiced sales amounted to EUR 300 million (280). After adjustment for the effects of exchange rate movements this represents an increase of 3 percent.

Sales to the largest ABS market segment Water & Wastewater as well as to the Industry segment have increased, although the Pulp and Paper industry has slightly declined compared to the previous year. Sales to the Construction Industry and Building Services markets have improved, due to the effect of the acquisition of the US company CH&E Pumps.

Operating earnings decreased to EUR 26 million (28), mainly as an effect of lower margins on products to the Pulp and Paper industry.

Developments in 2000

During the year 2000, ABS continued the expansion of aftermarket activities with a new service concept. New service centres have been established and several acquisitions of local service companies were also made during the year.

Significant orders in 2000 included dry-pit pumps for a water treatment plant in Turkey, large submersible wastewater pumps for Sweden, 66 submersible mixers in stainless steel for the treatment process in a new sewage treatment plant in South Korea and drinking water pumps for a waterworks in the Shanghai area of China. An order was also received for 30 mixers for a wastewater treatment plant in Moscow.

In the Pulp and Paper segment, major orders were received from, amongst other places, China and Indonesia.

The ABS business concept is to always offer the most cost-effective solutions and the lowest Life Cycle Cost. ABS places great emphasis on offering products that are not only reliable, but also energy-saving and easy to install and maintain, i.e. where regard is taken to the total life cycle cost of the product.

To symbolise this concept, ABS uses the iceberg which shows that the initial cost - the part visible above the water - is only a small fraction of the total life cycle cost, most of which is hidden below the surface.

In 2000, ABS continued to expand the broad product range, and amongst the new products introduced was a high-pressure submersible pump for wastewater applications.

The start of the year saw the acquisition of the US company CH&E Pumps, which produces diesel-driven dewatering pumps for the construction sector.

The organisation

The broad ABS range of both submersible and dry-mounted pumps, mixers and aerators is produced by modern manufacturing units in Sweden, Germany and the Republic of Ireland.

Marketing and sales are carried out through ABS sales subsidiaries in about 30 countries, with other countries covered by their own representatives, distributors and agents. ABS is now present in more than 100 markets the world over. Service operations are integrated into the sales companies, and ABS also has a large number of authorised service workshops offering expertise over a range of services. Altogether, ABS offers aftermarket services in more than 1000 locations.

In order to enhance its customer orientation further, ABS changed its sales organisation at the turn of the year 2000/2001 from having been geographically based to being based on market segments reflecting customers' applications and processes. Water and Wastewater, Industry and Building Services are to be represented by separate marketing organisations, creating even greater potential to focus on each group of customers.

On September 1 2000, Thomas Widstrand took over as new head of the Cardo Pump business area.

ABS is the major part of Cardo Pump which in turn is one of three business areas within Cardo AB, an industrial group listed on the Stockholm stock exchange. Cardo AB had a group turnover in 2000 of more than EUR 1,150 million.

Exchange rates from SEK to EUR: 8.4539 (2000) resp. 8.8159 (1999).