R&M, the globally active developer and provider of cabling systems for high-quality network infrastructures, based in Wetzikon, Switzerland, posted the best sales figures in the company's history in 2018. The Group increased sales by 14.2% in comparison to 2017 and posted sales of CHF 265.1 million worldwide. «The key factor was the very positive market dynamism particularly in the market segments Data Center and Public Networks. The strong surge in sales was supported by a number of major projects, particularly in the Middle East», reports CEO Michel Riva. The operative profit margin of 5.9% could be kept slightly below the level as the previous year in spite of considerable investments in new products and the opening up of new markets. Worldwide R&M has more than 1,200 employees.
The financial year 2018 got off to a surprising start with an exceptional number of orders from data center operators. The international trend towards cloud applications and the outsourcing of data processing is currently leading to major investments in hyperscale and colocation data centers. R&M can offer cabling solutions for both categories. For example, national market leader Safe Host S.A. opted for cabling solutions from R&M when it came to equipping Switzerland's largest data center.
On the Fiber to the Home (FTTH) cabling market, R&M is increasingly asserting itself as a partner for complex major projects. Big names such as Swisscom and Etisalat in the United Arab Emirates (UAE) are currently expanding their FO networks with the support of R&M.
The local data network (LAN) market segment continued to develop positively in 2018 in a difficult environment. The trend towards digitalization played an important role in this process. Residential buildings, office complexes, shopping malls, and functional buildings are increasingly being equipped with sophisticated copper cabling to turn them into intelligent buildings (Smart Homes, Smart Buildings) and thus be able to control them remotely using data networks or the Internet.
«The boom flattened out somewhat in the second half of the year. Furthermore, price pressure on major projects, investments in further market development, as well as currency fluctuations, put pressure on the results,» the company reports.
All sales regions posted positive results. Sales in the Middle East increased by more than 35 % thanks to major projects. R&M also achieved high double-digit growth rates in North and South America. «The investments made over the last three years in these two regions are paying off. Further investments are planned for the coming years», explains Michel Riva.
In Asia, R&M benefited from a strong market boom in India. Developments in the key markets in China and Southeast Asia were more restrained due to the political situation. In Australia, R&M equipped several major projects with network technology, including a hospital and an event and leisure complex. The European market organizations, in turn, remained on target. Northeast and Southeast Europe considerably surpassed their targets. In the strong, highly contested markets of Switzerland and Germany, growth continued to be in the solid single-digit range.
Also in 2018, R&M invested in projects which are ensuring sustainable growth. For example, the company took over Transportkabel DIXI a.s. in the Czech Republic to extend the value-added chain and be able to offer proprietary cables. Last summer, R&M opened up a new, state-of-the-art plant for FO products in India to be able to serve the dynamic Asian market even more efficiently. In Brazil, the production plant for cabling products taken over from Peltier was integrated into the R&M corporate group. More and more R&M is acting as an advisor, project consultant and provider of services.
In terms of the prospects for 2019, CEO Michel Riva anticipates reduced market dynamism. Also, several major projects are drawing to their close. «Nevertheless, we are assuming we will continue to gain market shares above the industry average. We will strengthen our competitiveness with new, innovative products which will stand up to price pressure. Intelligent products are also increasingly playing a role. This is why we are increasingly investing in proprietary software development», concludes Michel Riva.