“Our emphasis on developing more sustainable technologies will put us in a strong position to grow further as the environmental benefits of powder coatings continue to become more attractive to customers around the world.”
The global economic downturn has had a major impact on the powder market, leading to a substantial reduction in volume and severe pressure on prices. In this context, our business performed well. We produced satisfactory results and maintained course on our strategic growth agenda.
We have been steadily investing in building a global position, especially in high growth markets – notably China and Eastern Europe. This policy paid off in 2009 as the economies in these high growth markets bounced back faster than the rest of the world, which had a positive impact on our sales. We maintained our strategy of focusing on defined market segments and developing segment-specific value propositions which offer customers a complete service package rather than just a product. Our sites are also becoming more dedicated by concentrating on specific technologies and segments. This approach has been the foundation of our market share growth and has strengthened our ability to resist price pressure and maintain margins.
We responded to the downturn in market volumes by implementing extensive cost-cutting programs, especially in the mature markets, which mainly involved workforce reductions. This included the announced closure of our site in Fombio, Italy. These actions played a significant role in helping us to maintain our financial performance, although part of this improvement will not be realized until 2010.
We continued to expand in high growth markets and announced plans to open another factory in China, which will be inaugurated in early 2010. Our new plant in Russia also had an extremely good year. We are the only international company supplying powder coatings from within Russia and the facility is well on its way to becoming very successful. In addition, we secured supply agreements with Dell, Hewlett Packard, Whirlpool, Volvo and NCR, as well as being specified by McDonald’s to coat the interior furniture in their European restaurants. Meanwhile, a safety campaign launched throughout the business at the end of 2008 proved to be highly successful as our performance greatly improved during the course of this year. In early 2009, we divested our non-stick coatings activities, while towards the end of the year we boosted our global presence and technology portfolio by signing an agreement to acquire the former Rohm and Haas powder coatings activities from the Dow Chemical Company. This will add notable MDF and thermoplastic capabilities to our existing expertise.
Our commitment to sustainable innovation was underlined by the opening of a new research facility in Ningbo, China, and our plans to open a new resin technology laboratory in Felling, UK, where we are conducting applied research on lower temperature curing, new substrates and different resin formulations. This emphasis on developing more sustainable technologies will put us in a strong position to grow further as the environmental benefits of powder coatings continue to become more attractive to customers around the world, especially in high growth markets, where there is a high level of interest.
in € millions
Geo-mix revenue by destination