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Bosch Packaging posts €1.18 billion in 2014 sales
Source：Ringier Trade Media
Date Published：6/16/2015 11:06:51 AM
The company is setting its sights on further expanding its business areas and boosting market growth across the different regions
LEADING process and packaging solutions supplier Bosch Packaging Technology sales rose by €70 million in 2014, or a nominal 6.3% increase from the year before, to achieve €1.18 billion for fiscal year.
The sales growth, which reaches 6.7% when adjusted for current effects, outpaced the industry average of 4% based on data from Germany’s VDMA industry association. The Bosch division’s order intake reached a record level of €1.23 billion about 11% more than in 2013.
Rising order intake yields an overall positive outlook for 2015 for the manufacturer of special-purpose machinery. The main growth drivers would be connected industry and line competence.
Company president Friedbert Klefenz looks forward to further substantial sales revenue growth this year. Bosch Packaging hopes to continue growing significantly faster than the market, he said during a press conference at the ACHEMA 2015 World Forum in Frankfurt on Monday.
“The results achieved in the first four months of the current fiscal year give us every reason to be optimistic. Our proximity to customers and markets has enabled us to obtain a higher volume of orders compared with the previous year. This serves as the basis to reach our defined sales targets,” Mr. Klefenz said,
Sustaining the growth momentum
The company plans to leverage the recent acquisition of Osgood Industries, a supplier of food packaging systems in the United States, and the establishment of a joint venture with Klenzaids, an Indian company specializing in processing, packaging, and cleanroom technology for the pharmaceutical industry, to boost sales further.
As outlined in the Strategy PA 2020 presented last year, Bosch Packaging aims to boost market share and expand the number of business areas. It hopes to outpace the growth of the market in Europe and North America. Europe remains the division’s largest market with a 43% share of sales, while North America currently accounts for 25% of total sales.
In Asia, which posted slow growth in 2014, the Bosch division hopes to improve sales and increase the region’s share of total sales from the current 23%. It aims to generate one-third of sales from the region by 2020.
The planned business expansion extends to Africa, Latin America, and the Middle East. Bosch Packaging currently operates in four African countries, namely Egypt, Nigeria, Kenya, and South Africa.
According to Mr. Klefenz, the Pharma and Food business units achieved roughly equal sales in 2014. “We intend to keep things this way, with sales equally divided between the two units. They both offer great potential for growth. Within the food sector, our primary objective is to significantly increase sales of process and packaging technology for liquid food between now and 2020,” he stated.
The company is also looking to develop the market for so-called consumables. In the food packaging field, one example is the use of aroma protection valves that can allow gases to escape without letting any oxygen in, therefore preserving the full flavor of coffee. For pharmaceutical packaging, single-use systems in filling machines for highly potent medicines prevent the loss of active ingredients and reduce costs and processing times toward offering greater customer benefit.
Across all its business units, the Bosch division will continue leveraging its strengths in connected industry and line competence. Interconnecting the different stages of the manufacturing process on a broad scale allows the company to optimize the integration of all links in the value chain and ensure machine operation efficiency and product quality. The capability to manufacture a broader range of products on a single production line increases flexibility and improves overall service provision.
Bosch Packaging’s Remote Service Portal, for example, allows the division to provide prompt, efficient support to customers. Necessary data from the customer’s machines are transmitted to the Bosch Remote Service Center through a secure data link.
Greater focus from a single machine to the entire production line as a result of line competence enables the company to take into account all aspects such as material flow logistics and upstream and downstream process steps. Bosch adopts integrated process and packaging lines such as those handling both liquid and solid pharmaceuticals for many different projects in Russia, North Africa, and the Americas.
Growing regional markets
Bosch Packaging achieved high double-digit growth in North America in 2014 while making moderate progress in Europe.
Increased orders in the food industry propelled by the free trade zone created by the North American Free Trade Agreement (NAFTA) boosted sales in North America. The pharmaceutical packaging sector is likewise growing, backed by rising demand for machines for the production, filling, and packaging of pharmaceutical products.
In Central and South America, business development experienced a mix of ups and downs. The pharmaceutical segment posted a double-digit sales uptake. A major contract, in which Bosch designed, supplied, and installed special-purpose machines for an interlinked industry solution consisting of multiple production lines, signifies further growth prospects. The customer’s new, ultramodern factory will be capable of producing and packaging more than 450 liquid and solid pharmaceuticals.
In the food sector in Central and South America, however, sales were lower than 2013 results due to the weak economy.
In Africa and the Middle East, sales have also been developing well. Revenues have climbing by a percentage in the mid-single-digit range.
Bosch Packaging’s Asia-Pacific markets made weak progress in 2014, however, with sales lower than 2013 figures. The company, however, is looking at a positive outlook for 2015 on the back of newly developed high-quality, localized products that offer competitive costs and functionality compared with similar machines from Asian manufacturers.
First quarter 2015 results indicate new orders from China have picked up despite the slower economy. The acquisition of a 49% equity share in Indian company, Klenzaids, is likewise expected to strengthen the presence of the Packaging Technology division in India.
“This investment represents an important step forward in our efforts to gain a stronger foothold in this region,” Mr. Klefenz said.