What Swiss Rieter expects in 2013
TextileFuture has reported already on the key results of Rieter (Spinning Systems and Premium Components) for 2012. Therefore, we give you now the outlook and the expectations for the ongoing business year
As we all know, besides Rieter, the company is managing also the brands Bräcker, Graf, Novibra and Suessen. According to the management’s own declaration Rieter’s unique technology leadership in the spinning machinery market remains unchallenged and is confirmed also by the high access rates to the Rikipedia online database for yarn production information. Rieter entertains further contacts with universities, specialised institutes and leading fibre producers. The company protects its knowhow through patents and other useful means.
What is to be expected in 2013? The expansion of the Rieter locations in China and India will be completed by the end of 2013. The improving of global processes are advancing and with the completion of the 2012-13 investment programme also the market cycles response will be enhanced.
As to the market development, the company expects further market growth majorly in Asia and there will be adjustments in capacity at the long established locations. The number of personnel (temporary and permanent) at stake will be around 5 % of the total workforce (end of 2012: 4720) over 24 months, and mainly in Switzerland. In part it can be compensated through natural fluctuation, early retirements, and reduction of temporary personnel engaged specifically for the investment programme. The remaining workforce will be subjected to adjustments and consultations with the respective employees committees will be held.
Rieter will be focusing also on margin improvement through costs savings, optimal capacity management and greater price discipline, and in order to reach the medium term goals.
For its worldwide business, the company expects heterogeneous market developments, some of it will depend on currency exchange rates, consumer sentiment in Europe and North America, fibre consumption growth in Asia, and raw material prices. The slight improvements occurring in the second half of 2013 has continued in the first two months of 2013. Rieter’s management expects to reach similar full year levels in sales as in 2012, including operating profit (EBIT) before extra ordinary gains of disposed businesses, but including strategic project costs (investment programme 2012-13) of CHF 20 to CHF25 million. Operating profitability in the first half of 2013 will be lower to less attractive inherent margins in the current order backlog. Net profit will be slightly positive in 2013, in 2012 it amounted to CHF 12.0 million (CHF 28.7 million), or -58.0 %.