R&M Back in Profit

Increase in sales of nine percent / Two major orders / New innovations in the field of FO / Plant in Bulgaria successfully launched.

Wetzikon, May 3, 2012

In fall 2011, like many other Swiss companies, R&M had to initiate measures to increase efficiency, as well as a cost-saving program. These steps have proven to be the right course of action, as shown by a review of the first quarter of 2012. R&M achieved an increase in sales of nine percent and now finds itself in profit once again.

A new, attractive range of products in the area of fiber optics, major orders in the Middle East, cost reduction measures taking effect and constructive dialog with suppliers are important reasons for the successful turnaround. "We are talking about an EBIT margin of at least five percent", says R&M chairman of the board of directors and CEO, Hans Hess. "With an even distribution of revenue, this corresponds to an operating profit of over 2.5 million Swiss Francs."
The Optical Distribution Frame (ODF) is an innovation that has found outstanding market acceptance in Europe and the Middle East. This product from the field of Fiber to the Home (FTTH) is characterized by outstanding ease of installation – from large distributors through to street cabinets and private connections. Innovation and quality are important and are reflected positively in the accounts, Hans Hess confirms. However, two major orders from the Middle East have also contributed to the easing situation. Through saving measures, R&M has been able to reduce operating costs by five percent.

Production Successfully Underway in Bulgaria. In the space of six months, R&M built a new production plant for fiber optics (FO) in Bulgaria. The first 20 expert personnel were able to start work at the beginning of April, prior to which, they had been trained and inducted in Switzerland over the course of several months. Thanks to this knowledge transfer, R&M is ensuring that the high quality demands placed on its products are met. The transfer of the FO assembly tasks will take place gradually over the coming 12 months. In addition to production for various markets, the assembly line at the Wetzikon site will also be used for the development of production processes and for pilot projects.

Outlook Remains Cautious. The slowdown in construction activity in Switzerland and the fact that the economic prospects in Europe are currently difficult to assess mean that R&M is looking to the near future somewhat cautiously. The problem posed by the strong Swiss Franc also continues to concern providers of complete systems. Nevertheless, CEO Hans Hess is convinced that R&M can counteract these issues by providing even better services: "We can only grow if we are able to gain market shares around the world." The Wetzikon-based family business aims to gain further market shares for itself through targeted sales activities. For the current year, R&M remains optimistic.