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Industrial Products India, Industrial Manufacturers & Suppliers
 




 
   
 
 
 

Lapp Group: Patchy performance,

Stuttgart, Germany , March 2015 During the 2013/14 business year (1 October to 30 September), Stuttgart-based Lapp Group further consolidated its market position and gained new market shares. Still, the company did not succeed in achieving its targets. Andreas Lapp, Chairman of the Board of Stuttgart-based Lapp Holding AG, said: We're better than the benchmark, but we should have made more gains. We've invested a lot over the last few years, but this hasn't had as much of an impact on our performance as we had expected and hoped. Revenue fell by 1.2 per cent last year , from 830 to 820 million euros, while income before taxes rose from 35.5 to 37.1 million euros. The number of employees increased to around 3,200 staff. Falling copper price impacts performance The significant decrease in the price of copper , which fell by an average of 10 per cent from 583 euros/100 kg to 525 euros/100 kg over the year , h a d t h e b i g g e s t i mp a c t o n r e v e n u e development. Because the actual cost of a cable is based on the market price of copper on any given day , revenue automatically falls with copper price. In addition, there was the negative currency development outside the Eurozone. Combined, these factors caused net revenue to fall by almost five per cent over the previous year . This means that, when adjusted for the price of copper and the exchange rate, revenue was up by 3.7 per cent from the previous year . The fall in net revenue was further influenced by the turbulent economy in key markets such as the German plant and machinery sector, as well as the Ukraine crisis. By contrast, the cable system solutions business, which includes e-mobility and tailored, customer-specific solutions, made a p o s i t i v e c o n t r i b u t i o n . R e v e n u e g r e w disproportionately in these areas. Andreas Lapp noted, We're sensing that business conditions have become more difficult worldwide, and there's nothing we can do about economic and political developments. In a tough environment, we've managed to gain additional market shares, but one thing is clear: we set ourselves targets that, even without these external factors, we wouldn't have achieved. We just didn't do our homework properly . But we know where our weaknesses lie, and now we're going to tackle them specifically . Positive outlook for the current business year The Lapp Group has got off a good start in the 2014/2015 business year . Without taking into account the risks and opportunities related to the development of exchange rates and the price of copper , the company expects to see a slight growth in revenue this year . The Asian and American markets are expected to make a significant contribution to revenue growth. The Group is not anticipating any significant growth in Europe due to issues related to the economy and exchange rates. Developments in the regions vary Due to the weakened rate of expansion of the world economy , revenue developed in different ways across the Lapp Group's regions. Europe (including South America, Africa and the United Arab Emirates): With a share of 70 per cent of total revenues, Europe is the Lapp Group's most important market. Revenue here amounted to 574 mi l l i on euros, whi ch corresponds to a slight decrease of 1.6 per cent. If it weren't for the fall in the price of copper and fluctuations in the exchange rate, there would have been revenue growth of significantly more than three per cent. In Germany , the most crucial individual market in Europe, revenue came to 265 million euros. The investments made in the previous years are now taking effect, helping to improve the Group' s competi ti veness. Chief Financi al Officer Andreas Hermann explained: In particular , our logistics and service centre in Ludwigsburg, which began operating in 2013, now gives us the opportunity to respond to customer demands in a more tailored way, and consolidate our position in the market. Revenue in the UK, Benelux, Austria and Poland has developed particularly well. America (USA, Canada, Mexico): Revenue development in this region was overwhelmingly positive (share of total revenues 10.4 per cent). Despite the developments of exchange rates, the Group managed to increase revenue by eight per cent to 85.4 million euros. Asia (including Australia and New Zealand): The rate of growth in Asia cooled off slightly last year a trend that also affected the Lapp Group's revenue in the region. With a share of 19.6 per cent of total revenues, Asia is the Lapp Group' s second most i mportant regi on. Revenue fell by 4.1 per cent to 161 million euros. Above all, this drop was driven by a significant revenue decrease in Korea a result of the difficult market for photovoltaics. However , Lapp Korea is now showing growth of around 20 per cent in the current business year . There was positive development in China, after Lapp opened its own production plant in Shanghai in 2013. There was also slight growth in India. The earnings and overall financial position of the Lapp Group are extremely solid. Despite the negative development in the market for copper , the Lapp Group made targeted investments for the future. The number of employees rose by 4.7 per cent to 3,200. HR costs, write-downs and other operating expenses climbed from 272 to 286 million euros. At the same time, the Group improved its earnings before taxes by 1.6 million euros, or 4.5 per cent, to 37.1 million euros. Even equity ratio climbed from 54.3 to 56.3 per cent. Andreas Lapp stated, The Lapp Group is in great shape. In light of the various internal and external factors that prevented us from achieving higher revenue and results, our performance isn't that bad now we must work towards stable, long-term growth. Compared with the previous year , the Lapp Group increased its investments from 26.2 to 27 million euros in the 2013/14 business year . In Brazil, the Group opened its first production plant in South America. The new Cabos Lapp Brasil plant has a production space of 6,200 square metres, which will soon be expanded to 10,000. The new plant opened with 40 staff, but this number will rise to 180 in the medium term. T o date, 5.3 million euros have been invested. Capacity at both plants in India was also increased. At the Bangalore plant, production space was more than doubled. The new space will allow the manufacture of 60,000 kilometres of multi-core conductor cables and 78,000 k i l o me t r e s o f s i n g l e c o n d u c t o r s . T h e investment came to around 1.8 million euros. At the second plant, in Bhopal, a new production line for multi-core conductor cables was installed. In Poland, a new sales and logistics centre began operations. The Lapp Group has had its own company in Poland for 14 years now , and the new building will accommodate the increasing demand in the Polish market. A total of 4.1 million euros have been invested. Despite the crisis in Ukraine, the foundations for a new sales and logistics centre were laid in Samara, Russia last year . The new centre will be completed by autumn 2015. Overall, 5 million euros are being invested in the site. In particular , Lapp's cable system solutions business developed very positively last year . For example, the new BMW i3, BMW's first completely electric car , makes use of the Lapp HELIX the new Lapp charging system. The new BMWi3 can be charged in a number of ways, in addition to using public charging stations: either via a Mode 2 charging system that uses regular household sockets, or via a rapid charging system, for extra-fast charging at public stations, for example. Additionally , drivers with a permanent parking space can now request the BMWi Wallbox a charging station that can be mounted on the wall of their home or garage. Lapp Systems supported BMW with implementing both solutions, in addition to developing both the rapid-charging cable and the cable and connector components for the BMWi Wallbox Pure. The Heilbronn-based firm Illig Maschinenbau Gmb H & C o . K G, a wo r l d l e a d e r i n t hermof ormi ng, i s now usi ng t he new O u t s t a n d i n g e x a m p l e s o f a p p l i c a t i o n NEWS U P D A T E ETHERLINE Cat.6A cable from Lapp for its 68 standard production machines and customerspecific configurations. This highly flexible cable facilitates data transfer rates of up to 10 Gb/s, and is also able to withstand the stresses of production. The customer hopes this will provide sufficient potential capacity for the continuously rising transfer rates. Lapp was the first provider in the market to be able to supply cables with this transfer rate to the required industrial quality , i.e. for use in both energy chains and with torsions, and in accordance with the crucial PROFINET standard. Previously , cables with these properties were only available for transfer rates of up to 1 Gb/s. An additional focus last year was expanding Lapp Group's portfolio in robotics the Champions' League of cable technology . The robotics specialist Lapp Muller, based in Grimaud on the Cte d'Azur , provided the Italian automation technology manufacturer Comau with robotic cables for its Open RoboGate framing system, which is being deployed at the Fiat plant in Melfi, for example. The system can put together an entire car body in less than a minute. Because of the short cycle times, rapid acceleration and hard braking, the cable is subject to significant mechanical stress. But thanks to the high quality of the Lapp robotic cable, Comau can still offer an eight-year warranty on the entire system, including cabling. Finally , for the refurbished El Dorado airport in Colombia's capital of Bogot, Lapp supplied 222 ki l ometres of fl exi bl e, hal ogen- free LFLEX CLASSIC 130 H cable for energy transfer , as well as UNITRONIC BUS EIB H data cables. These halogen-free cables will be used for lighting in the three passenger terminals. Thanks to their high flame resistance and low fire propagation, they meet even the most stringent fire protection requirements.

 
     
 
   
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