Von Roll lays the cornerstones of the new strategy

Zurich, The new management of Von Roll Holding takes positive stock after the first 50 days: in the existing electrical insulation technology business it has identified significant potential for further growth and operational improvements. Based on the figures for the current financial year the company management is setting itself the target of doubling sales and the operating profit margin in the core business within the next five years through organic growth.

With the signing of the purchase of Shenzhen Mica the company has already taken an initial step forward in further expanding its existing business and generating additional growth in Asia. The Chinese company employs around 1,000 personnel and is a global market leader in the business of fire-resistant, mica-based cable tapes and thermal insulation sheets. The acquisition will enable Von Roll to once again become the world number one in the market for mica-insulation products and to secure capacities in the insulation materials area. This will chiefly provide for a broader product portfolio and an optimisation of margins through price differentiation. The planned completion date is 1 January 2008.

Von Roll’s strategy in the existing business, whose end user markets – particularly in the energy sector – are expected to report further healthy growth, amongst other things envisions in future three cost optimised production hubs throughout the world – one each in Asia, in Europe and in the USA. The company management has earmarked the established site in Breitenbach as the European hub. In this way it is making a clear commitment to jobs in Switzerland and in particular to the employees in the region. The three production hubs will be supported by other cost optimised locations.

The acquisition of investment holdings outside the existing core business is expected to ensure additional, sustainable growth; however, Von Roll will be able to effectively apply its known strengths, such as e.g. the management of complex value creation chains. The new management has defined the areas of surface technology and components, water treatment and environment as well as selected manufacturers of innovative high-tech systems and components who operate as suppliers of key technologies in the above- mentioned areas, as promising new areas of business. Attractive candidates for acquisition, whose synergy, margin improvement and growth potential promise to provide an increase in the corporate value within the Von Roll Group, have already been identified and there is every likelihood that these will be available.

“We are on schedule with regard to the formulation and implementation of our growth strategy”, says the Chairman of the Board and CEO, Thomas Limberger. “The new management team is complete, the potential for operational improvements has been identified and is now being developed on a step-by-step basis. As to expansion into new areas of business, I anticipate that – following completion of the capital increase during the course of this year – we will be able to take the first major steps forward during the first quarter of the next year.”

In the first nine months of the current year the company has increased sales by 17% to CHF 474 million and the order backlog by 18% to CHF 497 million.