Phoenix Mecano A–Z 16 E

ANNUAL PHOENIX REPORT 2016 PHOENIX MECANO MARKETS FUTURE ON FOCUSING FOCUSING MECANO STRONG ON FUTURE A–Z BRANDS MARKETS Group headquarters Phoenix Mecano AG Hofwisenstrasse 6 Postfach CH- 8260 Stein am Rhein Contact address Phoenix Mecano Management AG Lindenstrasse 23 CH - 8302 Kloten Phone + 41 43 255 42 55 Fax + 41 43 255 42 56 [email protected] www.phoenix-mecano.com This annual report is also available in German. The German version is binding. PHOENIX MECANO – ANNUAL REPORT 2016 A161999.02_00_PM_GB16_Umschlag_EN.indd 1-6 10.04.17 10:10 ENCLOSURES MECHANICAL ELCOM / COMPONENTS EMS FOCUSING ON FUTURE MARKETS FUTURE ON FOCUSING A161999.02_00_PM_GB16_Umschlag_EN.indd 7-12 10.04.17 10:11 Phoenix Mecano A – Z 1 FOCUSING ON FUTURE MARKETS Our Group’s strategic shift towards future markets will safeguard its long- term growth. With digitalisation and the rapid development of microelectronics opening up new opportunities for differentiation, including in traditional markets, our ability to incorporate market trends into the development of innovative new products is helping us to exploit these opportunities. At the same time, we are capitalising on the Group’s existing strengths, such as its broad- based global structure. In our lexicon you will discover what makes us unique and how we are positioning ourselves in the markets of the future. A161999.02_170412_PM_A-Z_EN_04_cb.indd 1 13.04.17 13:31 2 Phoenix Mecano A – Z NAVIGATING TO THE FUTURE RAILWAY TECHNOLOGY ENERGY MEDICAL TECHNOLOGY TECHNOLOGY AUTOMATION ENGINEERING A161999.02_170412_PM_A-Z_EN_04_cb.indd 2 13.04.17 13:31 Phoenix Mecano A – Z 3 TOMORROW’S MARKETS Benedikt A. Goldkamp Executive Chairman of the Board of Directors What are the key future markets? visible market trends feed into The proportion of Phoenix OGY Phoenix Mecano’s traditional the development of innovative Mecano’s sales generated in target markets, such as mechani- new products. But it is equally Asia has risen from 14% to 24% cal engineering, the electrical in- important that we capitalise on in recent years. Can you exploit dustry, medical technology and the Group’s existing strengths, the growth potential in Asia by the furniture industry, are con- such as its broad-based global yourself or are you on the stantly evolving in response to structure and the consistent cus- lookout for strategic alliances? technological innovations. Digi- tomer focus of our sales compa- In theory, we aim to exploit talisation and the rise of micro- nies, to create advantages of flex- Asian growth potential by our- electronics, with sensors and ibility and speed. selves, and thanks to our long- computer chips now found in standing presence there we are many everyday objects, open up What indicators do you look well positioned to do so. However, new opportunities for us, in- for, and how do you identify Asia is expanding more dynami- cluding in traditional markets. A trends? cally than any other region in the relatively new development for Thanks to our vast customer world. We therefore see partner- Phoenix Mecano is the focus on base numbering over 100 000, we ships and acquisitions as a way of energy generation and distribu- often spot market trends before harnessing this potential as quickly tion markets. they appear in the press. However, as possible. Given the specific cul- we have to be particularly wary tural challenges associated with What opportunities and challen- when such trends are subsidised European-Asian cooperation, we ges do they offer the Group? by governments, as they often always examine such arrange- Firstly, it is essential that these turn out not to be sustainable. ments extremely carefully. A161999.02_170412_PM_A-Z_EN_04_cb.indd 3 13.04.17 13:31 4 Phoenix Mecano A – Z ADDED VALUE ASIA The Phoenix Mecano Group Phoenix Mecano has been pursues a long-term growth present in Asia for many years, strategy, which it has been with numerous sites in its major implementing consistently for growth regions, including India years. This includes harnessing since 1994 and China since value-creation potential in 1996. The proportion of sales existing markets, growth generated in Asia and the Mid- through targeted acquisitions, dle East has risen from 14% to value-oriented allocation of 24% over the past five years, company resources and a global making them increasingly impor- sales network. tant to the Group as a whole. Aerospace technology Automation engineering AEROSPACE AUTOMATION Bopla (electronics enclosures), TECHNOLOGY ENGINEERING Rose and Kundisch (human machine interfaces) and the As a manufacturer of power Growing global demand is companies making up supplies for electronic test being driven not only by In- the ELCOM/EMS division are equipment, Wiener is one of the dustry 4.0 but also by strong excellently positioned in Group companies benefiting wage growth and the trend this market. from steadily rising passenger towards high-quality products numbers, the resulting ex- in emerging markets. Rose + pansion of aircraft fleets and the Krieger (linear, profile and growth of niche applications. pipe connection technology), A161999.02_170412_PM_A-Z_EN_04_cb.indd 4 13.04.17 13:31 Phoenix Mecano A – Z 5 BUSINESS MODEL cost structure and product features tailored to individual The Phoenix Mecano Group’s customer needs. Combining core business is the development demand from customers in a and manufacture of industrial wide range of sectors enables components and modules. Its it to achieve economies extensive product range is of scale in industrial product distinguished by a competitive development. Flat and Exploiting value decentralised creation po- organisational tential in existing structure markets Group-wide or Growth B2B cross-division through standards targeted BUSINESS MODEL acquisitions Flexible All Phoenix Mecano Group allocation of Value-oriented companies act as suppliers of company allocation mechanical and electrotech- resources of company resources nical components in the B2B market. In most cases, these Management | Global sales components are critical to Governance network the success of our customers’ end products. Strategy BONUS MODEL For the management and the Executive Chairman of the Board of Directors, the bonus is a rec- ognition of exceptional business performance. A bonus is therefore only paid if the result Performance of the period exceeds a mini- Culture mum amount of 3% of equity for shareholders. No bonus is Standardised Long-term focus Group-wide paid in the event of a loss. financial and Continuous controlling improvement systems Nurturing talent Result-oriented division targets Sustainability as the guiding Cross-division principle in performance process design measurement A161999.02_170412_PM_A-Z_EN_04_cb.indd 5 13.04.17 13:31 6 Phoenix Mecano A – Z Competence centres CASH FLOW COMPETENCE CUSTOMER FOCUS CENTRES The Phoenix Mecano Group has Local presence and proximity to enjoyed a high level of free cash The Group has a number of customers are critical factors in flow for years, underscoring its competence centres that pool Phoenix Mecano’s success. Direct stability and together with its technical expertise and forge on-site contact with customers strong balance sheet ensuring the synergies between Group enables product and solution financing of organic growth, any companies and sites. Key centres requirements and other relevant acquisitions and regular include those for aluminium die parameters in each local market dividends. casting and stainless steel to be pinpointed effectively. processing in India, plastics manufacturing in Hungary and raw material procurement in CUSTOMISED Switzerland. SOLUTIONS These are the core of all business CORPORATE activities. Phoenix Mecano devel- CULTURE ops and produces standard industrial components for customers Combining 64 locations world- in the mechanical engineering, wide into a single corporate electrical and furniture industries. culture is no easy feat. It can The Group exploits economies of only be achieved in the long scale by pooling customer demand Free cash flow term through the willingness to from different industries and areas in EUR million cooperate across divisions and of application in its global network 37.5 regions, the Group’s decentral- of production sites. Thanks to this ised management structure and favourable cost position and its 29.6 the high degree of responsibility ability to customise standard com- 23.0 granted to individual Group ponents across its decentralised companies and employees. The distribution network, the Group 15.4 13.6 values of a growth-oriented has been able to establish itself as technology enterprise and a a market leader in industrial nich- sustainable family business are es. Its network brings these pro- equally embedded in the cessing technologies and services 2012 2013 2014 2015 2016 company’s culture. directly to customers. A161999.02_170412_PM_A-Z_EN_04_cb.indd 6 13.04.17 13:31 Phoenix Mecano A – Z 7 DECENTRALISED This management structure MANAGEMENT ensures proximity to markets and enables swift STRUCTURE decision-making and speedy The Group’s overall structure has implementation. always been very lean. Operational responsibility lies with the management, assisted DIGITALISATION by the operational managers of the Group’s divisions, main Increasing digitalisation is syn- business units and regions. onymous with growth for Phoenix Mecano. It generates demand for electromechanical Digitalisation components such as plugs and coding switches as well as the enclosures used to pack- age

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