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SIG focuses on beverage cartons and value added bottling In 2004, SIG continued its strategic focus, concentrating on the core business of aseptic beverage cartons (SIG Combibloc) and on the growing market of value added beverages in plastic bottles (SIG Beverages). The SIG Pack division and other units outside the beverages market were divested in the course of 2004. In the 2nd half, the Group decided to divest the Italian units of SIG Beverages. The contract covering the sale of the companies Simonazzi/Alfa to the Tetra Laval Group was signed on March 2, 2005. This strategic decision led to an almost complete amortization of goodwill of the SIG Beverages division and, consequently, to a pronounced negative net profit in 2004 for the SIG Group. For the coming years, SIG continues to see positive and profitable growth perspectives for the continuing activities of SIG Beverages and for the beverage carton business of SIG Combibloc. The core business of the Group (SIG Combibloc and the continuing activities of SIG Beverages) expanded further in 2004. Net sales and order intake grew to EUR 1184 million (2003: EUR 1167 million) and EUR 1160 (2003: EUR 1153 million) respectively. At EUR 84 million, the EBITA of the core activities did not reach the previous year’s figure of EUR 98 million. SIG Combibloc restrains difficult market conditions, SIG Beverages with positive EBITA In the year under review, SIG Combibloc again proved to be the main pillar of the Group. Adjusted for negative foreign exchange rates and divestment effects, the division increased its net sales by 7% over the previous year’s figure. Increases in raw material prices, however, impacted on margins in the year under report. The ongoing weakening of the US dollar also had a negative effect compared to the previous year. In the face of the prevailing market situation and the trends for the raw material prices, the Group Executive Committee decided on a comprehensive action plan designed to increase efficiencies and reduce costs. As a result of the one-time expenditure, the EBITA of the division for the past business year fell to EUR 112 million (2003: EUR 139 million) corresponding to an EBITA margin of 10.5%. Before expenditure for the cost-cutting initiative, which is reflected fully in the 2004 statement, the margin stood at 11.6%. At EUR 133 million, net sales of the SIG Beverages continuing business were on a par with the previous year’s figure (2003: EUR 135 million). Order intake, in contrast, rose by around 10% to EUR 128 million. In 2004, the division remained profitable, reporting an EBITA of some EUR 3 million. SIG Group: adjustment of goodwill impacts on net profit In 2004, the Group overall achieved net sales and an order intake of EUR 1694 million and EUR 1631 million respectively. A year on year comparison with 2003 is hardly enlightening given the numerous divestments made during the year under report. The decision to divest the Italian companies and their subsequent disincorporation from the SIG Beverages division led to a split of the goodwill and a separate valuation. In view of the expected sale price and considering the contractual risks, the goodwill amounting to EUR 93 million was amortized completely. The goodwill of the continuing units of EUR 105 million was adjusted by EUR 86 million. Consequently, these extraordinary amortizations impacted the consolidated Group statement by a total of EUR 179 million. As a result, a negative Group operating profit (EBIT) of EUR -118 million was reported for the closing business year. In net profit terms, the extraordinary impact led to a loss of EUR -166 million. Despite the negative net result for the 2004 business year, the Board of Directors will propose a dividend of CHF 1.00 per share with a nominal value of CHF 10.00 at the General Meeting scheduled for April 5, 2005. Changes in the Board of Directors Coinciding with the date of this year’s General Meeting, the terms of office of Lambert Leisewitz, Andreas Koopmann and David Schnell expire. Lambert Leisewitz and David Schnell are standing for re-election for a further term of office, whereas Andreas Koopmann is no longer available for re-election. Roman Boutellier and Leonardo Vannotti will resign from the Board. In addition to the re-election of Lambert Leisewitz and David Schnell, the Board of Directors will propose the new election of Peter J. Hauser (Chairman of the Board of Gallus Holding AG, St. Gallen) and Robert Lombardini (Chairman of the Board of Axpo Holding AG, Baden) to that body. Both Peter J. Hauser and Robert Lombardini have long-term experience in senior management positions in internationally active industrial enterprises. Their expertise and proven track records will significantly contribute to the continued success of SIG. Outlook: fit for the future The perspectives for the continuing units of SIG Beverages are highly promising. Despite substantial investments in leading-edge projects, SIG expects a balanced result for the coming year. Measures adopted by SIG Combibloc directed towards improving the operating margin should take effect in 2005 already. The already strained situation regarding raw material prices – particularly for polyethylene – make a forecast difficult. In the medium term, however, the Group continues to expect good growth potential for the beverage carton business. SIG is an international provider of aseptic beverage cartons and packaging equipment for value added beverages and liquid food. News overview >> |
