News
Weinheim, April 6, 2011. The internationally active Freudenberg Group, a family company, has successfully completed the 2010 financial year and laid the foundations for further profitable growth. The 2009 slump in sales was entirely offset; at €5,481.4 million, sales were up 30.5 percent on the previous year (previous year: € 4,200.8 euros) and 8.5 higher than the pre-crisis level of 2008 (€5,050.1 million). Profit from operations rose disproportionately by €592.2 million to €430.6 million and was significantly higher than the good figure achieved in 2008. In terms of sales and profit, 2010 was therefore one of the most successful financial years in the history of the Freudenberg Group.
"The swift economic recovery, the improvements in structures during the crisis, strict financial management in all Business Groups and, last but not least, the dedication and flexibility of our associates are the main reasons for our good performance in the 2010 financial year," said Dr. Peter Bettermann, Speaker of the Freudenberg Management Board, at the Annual Press Conference held in Weinheim on Wednesday. "The main challenge was the rapid switch from producing at a reduced level in the crisis to handling a strong-growth scenario. It was here that the organizational flexibility of all the Business Groups really came into its own. In combination with the important organizational foundations which we have laid, these developments mean that we have emerged from the crisis and embarked on the 2011 financial year with renewed strength," Dr. Bettermann stressed.
The cost reduction measures initiated at the end of 2008 and in 2009 as well as improved working capital management had a positive impact on earnings. There was a disproportionately high rise of €592.2 million in profit from operations to €430.6 million. This was chiefly attributable to the increase in contribution margins as a result of higher sales. Consolidated profit improved by €571.3 million compared with the previous year's figure (€-249.6 million) to €321.7 million.
Thanks to focused cash management, cash flow from operating activities rose by €12.0 million or 2.6 percent to €468.1 million. Free cash flow growth totaled €198.3 million in the year under review despite more active investment and a sharp sales-driven rise in receivables (previous year €260.9 million). The improvement due to the stronger profit was partly offset by the rise in working capital due to higher sales. The equity ratio rose to 47.4 percent (previous year: 44.5 percent). On December 31, 2010, the Freudenberg Group employed 34,319 associates, 2,177 or 6.8 percent more than in the previous year (previous year: 32,142).
Current developments
The positive economic development of the last financial year has continued in the first few months of 2011. The high level of orders on hand and incoming orders is indicative of a continued positive trend in the first half of 2011. However, Freudenberg expects the pace of growth to decelerate in the second half of the year. As regards profit, there are significantly higher risks in connection with prices and raw material availability.
"We intend to further reinforce our structure of independent Business Groups and Divisions, which has proved itself in the years of crisis, and to maintain the additional flexibility we have developed," Dr. Bettermann added.
Contact Freudenberg Group North America:
Cheryl Eberwein
47690 East Anchor Court
Plymouth, Mich. 48170-2455
Office: +1 (734) 354-5373
Cell: +1 (248) 767-1068
Fax: +1 (734) 451-0043