Bosch Discusses Financials & Buderus Acquisition
Apr 16, 2003
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Bosch will adhere to its long-term goals even when times are tough - this was the message delivered by Chairman of the Board of Management Hermann Scholl at a financial press conference. The Stuttgart, Germany-based corporation held the press conference on April 10 in Berlin and was intended to discuss the company's financial situation and the planned acquisition of Buderus AG, The planned purchase of Buderus AG will help Bosch to achieve "an even greater balance" in the structuring of its sectors. This balancing effort, as expressed by Mr. Scholl, is, together with an increasing globalization, "given top priority on the agenda of our business policy." In acquiring Buderus, Bosch intends to further expand its thermotechnology sector. As an important step in this direction, an agreement has been reached with Bilfinger Berger for the purchase of the Buderus shares. Bosch will extend a take-over offer to other shareholders. With this transaction, the Business Sector Consumer Goods and Building Technology, of which Thermotechnology is a part, would increase its share in total sales from its present 22 percent to 26 percent. The Bosch Outlook Bosch says globalization of business activities is making good progress. In North America, Mr. Scholl sees great potential for increasing sales dramatically in the next few years from the present 6.5 billion Euro (U.S. $7.05 billion). In the long-run, he added, China will also have a greater impact. Bosch succeeded in raising its consolidated sales in this country in 2002 by 30 percent to some 580 million Euro (U.S. $629 million). Including holding companies, business volume reached almost one billion Euro (U.S. $1.09 billion) and employees were almost 9,000. In the coming ten years, Mr. Scholl forecast, "we are going to see five times this volume". 2002 "Another Difficult Year" Looking back, Mr. Scholl said that, everything considered, 2002 was "another difficult business year". Economically speaking, all Bosch divisions "had the wind blowing in their faces". The fact that sales of the Bosch Group nevertheless increased by some three percent to reach 35 billion Euro (U.S. $37.99 billion) is largely due to the first-time full consolidation in the key data of the new acquisitions, mostly Rexroth. On the other hand, nominal growth of three percent was lost because of the revaluation of the Euro. Mr. Scholl explained that the exchange rate fluctuations blurred the comparatively positive development of overseas business. Sales outside Europe show a noticeable increase in local currency even without consideration of new consolidations – in North America by five percent and in Asia by nine percent. Mr. Scholl said business in Europe was a disappointment, especially in Germany. Given the circumstances, Bosch's chairman of the board of management said he considered it a success "to be able to remain at par with the previous year as regards our result". The employee head count also remained stable. At the beginning of 2003, Bosch employed some 224,000 people. This is an increase of 3,300 over the previous year, which is mainly explained by changes due to the consolidation. The head count in Germany also remained practically constant at some 102,000. In regards to 2003, Mr. Scholl considers "all previous forecasts dubious" after the beginning of the war on Iraq. He says hopes of an economic upswing in the second half of the year "can no longer be sustained". Sales of the Bosch Group in the first two months of the year were above last year on a currency neutral basis, however, expressed in Euro, the stagnation continued. Mr. Scholl said he assumes that, for the next few months, Bosch will see a negative development. "Whatever will come after that is, from the present perspective, more unsure than ever before," he said.

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