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SMS group Increases Investment; Order Intake Slumps

12/18/2009 - The order intake of the SMS group in 2009 will drop to less than half of the EUR 5.15 billion in 2008. Capacity utilization has hardly been affected because the company is still working its way through a high stock of orders from the boom years.

The order intake of the SMS group in 2009 will drop to less than half of the EUR 5.15 billion in 2008. Capacity utilization has hardly been affected thus far, because the company is still working its way through a high stock of orders from the boom years. Sales in 2009 are set to match the previous year’s level of EUR 3.6 billion.
 
Short-time work has already started in some areas, and the group says it is likely to spread in the next year.
 
“We’ll use the [economic] crisis to boost our technological development and efficiency,” said Dr. Heinrich Weiss, Chairman of the SMS group. “Our investment programs will go ahead as planned, with budgets increased anti-cyclically so we can make the most of low purchase prices. Next to our headquarters in Hilchenbach, Germany, our family-owned company…is building one of Europe’s most modern heavy machinery construction shops. Going green is just one reason our technological development will focus on resource-saving machine and plant construction strategies. That, in turn, means our customers will benefit from increased competitiveness.”
 
The current recession was to be expected after the long boom, according to Weiss, but the credit crunch exacerbated it. “Basically, this cycle fits into the long-term pattern of the German machinery and plant construction market,” he said. “There have always been boom years followed by a few lean years. Our innovativeness and experienced, constantly higher-trained core staff, plus our independence from banks due to our cautious financial policy, make me confident we’ll pull through this crisis even stronger than before.”
 
Despite the crisis, the group says that its trainee quota is currently some 7% of the workforce—much higher than the industry average. Close cooperation with schools and universities, the SMS student support program, introduction programs for newly qualified engineers, and the SMS Akademie with its range of education classes for all staff members are examples of the group’s emphasis on training and further qualification in the company.
 
SMS group is, under the roof of the holding SMS GmbH, a group of companies internationally active in plant construction and mechanical engineering for the steel and nonferrous metals industry. It consists of two business areas: SMS Siemag and SMS Meer. In 2008, some 8900 employees worldwide generated a turnover of more than EUR 3.6 billion.