KSB Group results at previous year’s level
Report on the Financial Year 2001: The economic trough that gathered in the spring of 2001 continued to affect the overall economic situation in the rest of the year. In more and more countries and regions of the world, demand for capital goods declined. This led to an overall worsening of the situation in the mechanical engineering sector, including the pumps and valves industry.
Order intake and sales are up
The declining demand in many markets for equipment goods made itself clearly felt, especially during the last quarter of 2001, in the order intake for pumps and valves. The KSB Group nevertheless achieved a 2.3% increase in orders received in 2001 compared with the previous year. A substantial contribution to this achievement came from some major orders received in the second half of the year from the Middle East and North Africa.
In Europe, the downward trend in KSB AG and KSB S.A. contrasted with increases in orders in the other European companies. Whereas orders in our American companies showed further improvements in the year under review, the KSB companies in the Asia-Pacific region showed a lower volume of orders than in the previous year.
With a growth rate of 6.8 percent, Group sales in the year under review were satisfactory. The strongest sales growth came from European companies, including KSB AG and KSB S.A. The service business developed especially well here, as did the sale of pumps in energy and water engineering. Marked sales growth was also seen in the Asia-Pacific region, whereas sales stagnated in the American KSB companies.
Number of employees slightly down
The number of employees throughout the Group fell by 1.2 percent, most of the reduction being in some manufacturing companies in the Regions Asia-Pacific and Americas. On 31 December 2001, 12,066 people were employed in KSB Group companies.
Pressure on prices puts a brake on results
Market trends in pumps, valves and services continued to keep prices under pressure. Increased costs could not be completely offset by productivity increases at KSB. For this reason, the 2001 Group results are expected to be at the same level as in the previous year.
Reorganization strengthens market focus
At the beginning of 2002, KSB companies in Europe implemented the new functional organization. Bringing together the sales and marketing of pumps and valves and establishing market-focused competence centres will create good conditions for getting the most out of market potential that has not yet been tapped.
For 2002, KSB anticipates that order intake and sales will remain at prior-year levels. In the first half of the year developments are likely to show a downward trend, because there is always a time lag in the effect of econo-mic changes on the pumps and valves industry. Based on the anticipated order intake and sales, the results for the year 2002 are expected to range at the level of the previous year.
Source: KSB SE & Co. KGaA