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Despite Downturn, SMS Group Reports Strong Finish for 2008

12/09/2008 - The SMS group reports that it is expecting a slight increase in order intake for the current year 2008, to around EUR 5.4 billion as compared to EUR 5.15 billion in the previous year.

The SMS group, Düsseldorf, Germany, reports that it is expecting a slight increase in order intake for the current year 2008, to around EUR 5.4 billion. This compares to EUR 5.15 billion in the previous year.

By the end of the year, the company said that sales would be somewhat above EUR 3 billion, following the order intake with the time delay that is typical of the plant engineering sector.
 
Vigorous worldwide economic activity in the steel industry until a few months ago has allowed the group to once again achieve a record order intake this year. However, as in most industrial sectors, only a few orders have been received since September of this year. With the downturn in project activity, a considerably lower order intake is expected for the coming year. The company said its high order backlog from the past boom years would help to safeguard the workload for one to two years.
 
Once again this year, Russia, India and China were the most important markets for SMS, whereas customers in the traditional steel regions made a more average contribution to the order intake, with the exception of the major order from ThyssenKrupp Steel AG for its new plant project in Alabama.
 
In addition to the good business situation in the classical machinery and equipment building sector, the growth areas of electrical and automation systems and service have contributed strongly to the SMS group’s increased order intake. As a system supplier, the group has for many years followed the strategy of closely supporting the customer throughout the entire life-cycle of a plant; the group considers this strategy essential for the success of its business in these fields.
 
To maintain its leading position in the market, the SMS group recognizes its strong dependence on a constant flow of innovations and, consequently, on highly qualified employees. The proportion of apprentices in the SMS group is currently around 7% of the employees in Germany, which is an above-average level for the sector.
 
The group places a particularly strong emphasis on vocational training and subsequent employee development through close cooperation with schools and universities, the SMS study grant scheme, well-aimed introductory programs for young engineers, and the newly-created SMS Academy, which features a wide choice of  educational possibilities for all employees. During the current year, the group has recruited or gained through acquisitions about 800 new employees worldwide, around 400 of them in Germany. The SMS group has a present strength of approximately 9000 employees, which compares to an employment level of around 8000 employees in 2007.
 
SMS group is, under the holding SMS GmbH, a group of companies internationally active in plant construction and mechanical engineering for the steel and nonferrous metals industry. It consists of the two Business Areas SMS Demag and SMS Meer, which jointly form SMS metallurgy. In 2007, some 8000 employees worldwide generated a turnover of about EUR 3.0 billion.