"In a very exciting market environment, we differentiated ourselves through flexibility and strength," said members of the Plansee Group's Executive Board Bernhard Schretter and Karlheinz Wex during the annual results press conference in Reutte, Austria. They added that, in light of an equity ratio of 58 percent, the Plansee Group was in excellent shape, debt-free and equipped for economic fluctuations as well as additional development steps.
All sales markets and regions, as well as all of the Plansee Group's divisions and companies, contributed to the sales growth. Regionally, 53 percent of revenue came from Europe, 25 percent from the USA, and 22 percent from Asia. The drill manufacturer Komet acquired in 2017 contributed one third to the increased sales. Total sales volume rose by seven percent.
Schretter and Wex described the course of the fiscal year as a year "with two faces." The first half of the year had been marked by "immensely high demand," while business notably cooled off in the second half of the year, and in the months of December and January in particular. "Our continued goal must be to meet fluctuating demand and the rising competitive pressure from China with flexibility and strength," Karlheinz Wex added. As a result, the Group made continued investments in its performance capability in the past year and took important steps to expand the recycling rate and in terms of employee training.
Investments and new products
In the past fiscal year, the Plansee Group invested 210 million euros in strengthening its performance capability. The majority of investments went toward creating new and expanding existing production capacities and automating production plants and flows. The Group focused primarily on the manufacturing sites in China, India, Austria, Germany, Japan and Switzerland. The Plansee Group invested a total of 67 million euros in the development of new products and process improvements. New products (products less than five years old) account for 29 percent of sales revenue, the same level as last year. The organization in the Plansee High Performance Materials division was extensively streamlined to reduce interfaces and facilitate growth.
Increasing the recycling rate
In view of volatile raw materials markets and difficult general conditions for tungsten mines in the West, the Plansee Group has taken further steps to safeguard the raw material supply of tungsten in the long run. On March 1, 2019, Plansee announced the acquisition of Stadler Metalle. The German company specializes in the trade and processing of hard metals. Karlheinz Wex: “Hard metals are made of tungsten and cobalt. Demand for these metals is on the rise worldwide. Stadler purchases used hard metal tools and analyzes and sorts them.” The acquisition is expected to further increase the recycling rate of tungsten in the Plansee Group from presently 60 percent. The capacity for recycling hard metal scrap to yield fresh, usable tungsten and cobalt powder is also being expanded at the locations in Finland, the USA and Austria.
Training skilled workers in-house
Bernhard Schretter considers well-trained skilled workers to be a key competitive advantage of the Plansee Group. The Plansee Group has initiated a number of efforts to train skilled workers and integrate them into the company. According to Schretter, the chances for young people to garner an apprentice position at Plansee and Ceratizit in Reutte have never been better. The reason is that the companies will be offering 50 percent more trainee positions per year. In the past year, 40 apprentices were newly added, and this figure will increase to 60 new trainees annually in the coming years. Two new IT jobs – Application Developer and Information Technologist – are being added to the existing jobs in trades. To create the necessary space, the Plansee Group is making a six million euro investment this year in the new construction of an apprentice workshop in Breitenwang/Reutte.
The start of a Higher Technical Education Institute (HTL) class for industrial engineering, specializing in business information technology, announced for the fall of 2020 is another milestone. Plansee has been committed to this project for quite some time and will actively support the new HTL training in Reutte with laboratories and workshops.
The industry portfolio
The industry portfolio of the Plansee Group developed positively again over the last year. The Group companies reported sales of three billion euros in the 2018/19 fiscal year. Production revenue in Breitenwang/Reutte was 678 million euros. Worldwide, the Group companies had 14,451 employees on the reporting date of 2/28/2019. Austria employed a staff of 2,483 in the past fiscal year – 111 more than in the year before, and the highest number ever. In the Außerfern/Allgäu region, the Plansee Group's 3,800 employees make the company one of the largest employers in the area.
Following major fluctuations in demand in the past fiscal year, demand has leveled off in the first quarter of the current fiscal year to a slightly lower, but stable rate. The atmosphere was perceptibly subdued, especially in the automotive industry and in mechanical engineering. Many customers are reducing their inventory. "At present, we expect the business environment to remain at this level in the coming months," says Karlheinz Wex. The Plansee Group is not directly affected by Brexit and unforeseeable trade conflicts. "Still, in the long run these developments hurt the entire economy," Karlheinz Wex added. And he confirmed: "To remain successful in the future, we will stick to our clear focus on tungsten and molybdenum materials for high-tech applications, create the conditions for excellently trained employees, and continue to invest in our performance capability, and in skills and processes in particular, to be the preferred supplier for our customers."
About the Plansee Group
With its divisions Plansee High Performance Materials and Global Tungsten & Powders (both 100 percent ownership), the joint venture Ceratizit (50 percent) and its holding in Molymet (21.1 percent), the Plansee Group is one of the world's leading powder metallurgical industrial groups. The Plansee Group specializes in molybdenum and tungsten materials, covering the entire value-added chain—from the ore concentrate to customized tools and components. The Plansee Group's portfolio includes more than 75,000 different products and tools, which are used in the production of everyday high-tech devices such as smartphones as well as sustainable and efficient solutions related to mobility, energy supply and industrial manufacturing.
In 2018/19 fiscal year, the Plansee Group, with its 7,979 employees, achieved consolidated sales of 1.52 billion euros. Across the portfolio of the Plansee group (all 20 percent and higher interests combined), sales of 3.0 billion euros were achieved with 14,451 employees. The fiscal year closes on the last day of February.