 |
2000 |
1999 |
in % |
in % (1) |
|
Orders received |
5775 |
5387 |
+7 |
+7 |
|
Net sales |
5736 |
5519 |
+4 |
+4 |
|
Operating income before goodwill amortization and exceptional items |
418 |
309 |
+35 |
+24 |
|
Operating income |
317 |
417 |
–24 |
|
|
Net income before exceptional items |
244 |
176 |
+39 |
(pro forma) |
|
Earnings per share before except. items |
69.5 |
48.4 |
+44 |
(pro forma) |
|
Net income |
206 |
254 |
–19 |
|
|
Earnings per share |
58.7 |
69.8 |
–16 |
|
|
Employees at year end |
22 097 |
21 170 |
+4 |
|
(1) adjusted for acquisitions and currency translation
Ueli Roost, Sulzer Ltd Board Chairman and CEO: “This strong result is primarily the fruit of our intensive profitability enhancement programmes; it also reflects the livelier business activities in many of our markets. Whereas in 1999 the decline in operating income was offset by high positive exceptional items, the business situation for the year 2000 was more favorable, with a sharp rise in sustainable profitability, and significantly less influence from exceptional items.”
Goodwill amortization totalled CHF 63 million (1999: CHF 64 million). Exceptional items (mainly comprising corporate realignment costs) negatively affected the 2000 accounts by CHF 38 million, as against positive impact of CHF 172 million in 1999. In the prior year these exceptional items included substantial proceeds from the sale of the Sulzer Medica Electrophysiology Division and of Sulzer Hydro which offset the substantial restructuring costs and extraordinary goodwill impairment.
Operating income totalled CHF 317 million (a fall of CHF 100 million from 1999). Sulzer Medica contributed CHF 230 million and Sulzer Industries CHF 128 million, including “other and consolidation” charges of CHF 41 million not allocated to these two corporate sectors. Included in this number are costs for the promising Sulzer Hexis fuel cell project, and nonrecurring costs for corporate realignment.
In comparison with the prior year, net income after tax and minority interests declined from CHF 254 million to CHF 206 million. Pro forma accounts excluding exceptional items show a marked rise of 39% in net profit from CHF 176 million to CHF 244 million. The underlying profitability of the Sulzer Corporation has improved substantially.
The Board of Directors proposes to the General Meeting of April 19, 2001 a dividend of CHF 20 per Sulzer Ltd share.
Sulzer Medica: doubledigit growth
Sulzer Medica sales rose by 14% (8% adjusted for currency effects) to CHF 1347 million. This good result is primarily attributable to the increase in Orthopedics division’s sales to CHF 1097 million, a rise of 13% (8% adjusted for currency effects). Cardiovascular Prostheses sales were CHF 250 million, a rise of 19% (9% adjusted for currency effects). Further details are given in the separate press release by Sulzer Medica.
Sulzer Industries: record earnings
The record results achieved by Sulzer Industries were primarily due to substantial internal improvements, and in part to a more favorable market situation. The “Performance” efficiency enhancement programme launched in 1999 has made faster progress than expected. Operating earnings were negatively affected by nonrecurring restructuring costs of CHF 24 million.
Strategic development of the business portfolio, with a focus on optimizing value creation, continued with the acquisition of Ahlstrom Pumps, in Finland, and Interturbine, of the Netherlands. As a consequence of the strategic refocusing announced for Sulzer Industries, Sulzer Turbo was sold per year-end 2000 to MAN GHH Borsig, Germany. Negotiations for the divestiture of Sulzer Textil and Sulzer Infra are well advanced. The divestiture of Sulzer Burckhardt will be started in the second half of 2001 (following turnaround).
Sulzer Services and Equipment (Sulzer Metco and Sulzer Turbomachinery Services) closed the year very successfully with a 13% sales rise to CHF 455 million (prior year: CHF 403 million). Both business units were strengthened by acquisitions (Sulzer Metco: Eldim and Interturbine Coating Center; Sulzer Turbomachinery Services: Elbar) which are not yet consolidated in the income statement 2000 and have not contributed to the sales increase as reported.
Sulzer Pumps sales increased by 21% (11% adjusted for acquisitions) to CHF 855 million (prior year: CHF 709 million). This is attributable to the improved market situation in the second half of the year, particularly in oil and gas, power generation as well as pulp and paper markets.
Sulzer Chemtech has been affected by the weak demand in petrochemical markets. Although sales increased by 12% to CHF 293 million (prior year: CHF 262 million), a small loss of CHF 2 million was recorded due to weak margins. However, there are good prospects for an upswing in the petrochemical market this year.
The Sulzer Industries businesses to be divested closed the year with very mixed results. Sulzer Infra sales rose by 10% to CHF 1467 million (prior year: CHF 1329 million); profitability suffered, however, due to a setback in non-core activities. Sulzer Textil enjoyed the best business year for a decade, with sales 5% higher at CHF 685 million (prior year: CHF 650 million) and significantly improved profitability. Sulzer Compression (Sulzer Turbo and Sulzer Burckhardt) sales declined by 7% to CHF 483 million (prior year: CHF 519 million), but showed a marked improvement in profitability.
Prospects for the current year
Sulzer Medica anticipates continued growth during 2001, not least due to the opportunities arising after separation from the larger Sulzer AG group (see Sulzer Medica press release).The prospects for Sulzer Industries are also strong, based on the restructuring performed, the acquisitions of 2000 and the potential for further margin improvement.
- The press release is available on Internet: www.sulzer.com/press.html
- The Sulzer Annual Report including financial data is also available on the Internet as of 07.30: www.sulzer.com/press.html |