R&M Boosts Sales and Invests in the Future

14.8% growth in local currencies / 2011 overshadowed by the strong Swiss franc / Strong balance sheet safeguards sustainable development / Expanding the sales regions

Wetzikon, March 15, 2012

The year 2011 saw the Swiss cabling company Reichle & De-Massari AG (R&M, www.rdm.com) give a good account of itself under difficult conditions. The company was able to increase its market share in a number of countries and consolidate its position as one of the top three competitors on each of the key markets. In terms of local currency, sales grew by an impressive 14.8% compared to the previous year.  However, due the strong Swiss franc, this translates into a modest increase in domestic currency of just over 5% to CHF 189.4 million. The currency situation has therefore left its mark on profits and put the company at an operating loss with an EBIT margin of -0.5%. The company balance sheet nevertheless remains very strong and this platform gives R&M sufficient scope for sustainable development. In 2011 R&M took the necessary measures to ensure a long-term improvement of the profit situation and prepare the company as well as possible for future challenges.

Selective measures have relieved some of the cost pressures created by the strong franc. This process involved renegotiating agreements with long-term suppliers, increasing natural hedging and taking further measures to streamline the production processes. Having set up a new production plant for fiber-optic products in Bulgaria, R&M aims to safeguard the company’s long-term capacity to compete in this fiercely contested growth sector. R&M continues to be recognized as a Swiss company which generates a substantial part of its net profit in Switzerland, has secured some major investments there over recent years, and also aims to keep as many jobs as possible in the Swiss workplace. Research and development, marketing and much of the highly automated production process will therefore remain based at the head office in Wetzikon.

In Switzerland, R&M has heavily invested in the development of new products, adding to measures taken in previous years. The company has also strategically expanded its sales organization on the key markets and secured its position as one of the top three providers in Europe and the Middle East. The Swiss and German markets have been the main driving force behind the company’s growth.

In response to internal market analysis and a number of positive customer feedback reports, R&M’s new areas of growth – data centers and FTTH – have been the subject of targeted development. In the previous year, R&M had already enjoyed considerable success through its modular copper and fiber cabling solutions for data centers. The innovative solutions simplify installation and maintenance and increase productivity in the data center. R&M has also been able to stretch its technological lead in the field of connection techniques. In September 2011 R&M set a new world record, using optimized MPO connectors to achieve a high-speed error-free data transmission over a distance of 550 meters.

R&M can boast a range of ideas for new products and projects and works closely with colleges and research institutes to provide its internal designers with vital support. Through its close and direct communication with sales specialists on the various markets, the company also finds further inspiration to develop its user-centered design methods.

Innovation and production processes have been constantly optimized to ensure R&M customers receive the best technology possible. Over the past few years, R&M has increased the depth and breadth of its technical expertise and user-friendly solutions to become a global player in the fiber-optics industry. This financial year saw fiber-optic production levels soar at Kubus, the company's new, fully operational plant in Wetzikon. Thanks to this new and highly flexible infrastructure, R&M is well equipped to meet future challenges and is well placed to accommodate further increases in business volumes.


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