R&M Annual Report 2017

R&M Annual Report 2017

R&M, the globally active developer and provider of cabling systems for high-quality network infrastructures, based in Wetzikon, Switzerland, has announced its results for 2017. The Group generated sales of CHF 232 million, 1.2% above the successful year of 2016. The EBIT margin in 2017 was 6.1% (previous year 6.6%). «The demands for the 2017 fiscal year were ambitious after various large customer projects had come to their close at the end of 2016. But we nevertheless reached our goals and confirmed the good results of the previous year. The EBIT margin is within expectations in spite of price pressure and large investments, » says CEO Michel Riva. Particularly in the second half of the year, sales developed dynamically in almost all regions. This was due to new products as well as the investment boom in data centers and FO network expansion. Michel Riva: «R&M is a preferred equipment supplier. Particularly the demand for high-density FO platforms for large hyperscale data centers is growing notably. The demand for cabling solutions for intelligent business and office buildings as well as for FO broadband networks also grew.»

In the reporting year, R&M invested particularly in product development, the development of markets and in the now seven production sites. After the acquisition of the fiber optic business of Peltier Comércio e Indústria in the spring of 2017, R&M is now also producing in Brazil. R&M has extended the production sites specializing in FO products in Bulgaria and India due to the high demand. A new plant in Bangalore is to be occupied in the coming months to triple production capacity. Michel Riva emphasizes: «All plants manufacture in accordance with Swiss quality standards. We are one of the few companies in the industry committed globally in this way and which can offer on-site engineering services for the development and adaptation of products.» R&M is also supporting the dual vocational education system in Bulgaria based on the Swiss model. Since September 2017 the plant in Sofia has been educating the first five young people to become electromechanics. 

The subsidiary in Germany recorded the greatest growth in sales. Double-digit growth was once again recorded here, particularly due to FTTH projects. The expansion of fiber optic networks into homes (Fiber to the Home, FTTH) is also happening in other countries and, according to R&M observations, is currently growing at around 10% per annum. New boxes and splice closures for fiber optic distribution on the last kilometers to the subscribers are particularly in demand. 

The Swiss domestic market was the largest source of sales for the R&M Group also in 2017. «Sales could be further increased here too, in spite of tougher competition,» says Michel Riva. R&M acquired large projects in the segments Data Center and Public Networks. Michel Riva: «We are one of the leading suppliers of fiber optic cabling solutions in Switzerland today.» 

Despite difficult market conditions R&M experienced positive sales development in the Middle East and Turkey. The company is involved in, for example, the major Istanbul New Airport project and in building FTTH FO networks with direct local customer care. In Saudi Arabia, R&M belongs to the market leaders in the industry. The Asia Pacific region witnessed double-digit growth. In India too, R&M is establishing itself as a provider of FO systems. The Group is benefiting from investments in the telecommunications market there. 

The entry into the US market is running as scheduled. The Group is initially concentrating on the Data Center market there. Cloud providers are investing in gigantic flexible-use hyperscale data centers at numerous sites. In Milpitas, California, R&M is also expanding the industrial termination of components for copper cabling. These will primarily be used for more powerful data networks in offices and buildings. R&M is investing further in Sales on both the East and West Coast. 

Michel Riva, CEO R&M

Michel Riva, CEO R&M

R&M CEO Michel Riva summarizes: «As a flexible solution provider, our company was also able to set itself apart from the competition in the reporting year 2017. Together with the customers, tailor-made, specific solutions are being developed for their data networks. Thanks to innovative core components, an internationally established production network and local engineering, these solutions are made quickly and delivered cost effectively on time. We will further strengthen these competencies in the coming years.» Due to the dynamic development of the last few months, the R&M management is optimistic about 2018. The company aims to grow faster than the overall market and further extend its global position. By winning second place at the Prix SVC (Swiss Venture Club) Zurich, this dynamic growth plan was given further power at the beginning of 2018.

About R&M

R&M (Reichle & De-Massari AG) is a leading global producer of future-proof products and systems for communication and data networks. The company's close collaboration with certified partners results in pioneering connectivity solutions in the sectors LAN, Public and Telecom Networks as well as Data Centers. The Swiss family company stands for innovation, quality, and proximity to customers.