HELM achieves further growth in 2003
PRESS RELEASE
1. BUSINESS GROWTH
HELM Group is expecting figures for 2003 to show good increases in sales and profits.
Despite the difficult business and political climate, this family-owned company will be able to report figures that are even better than last year's good and very good results.
All the business units involved in the international marketing of chemicals, pharma products and fertilizer have contributed to this successful outcome. We have subsidiaries and company participation in 32 countries and these were equally successful.
Once again the petrochemicals sector was an especially reliable source of profit. Of the fine chemicals, sales and earnings from our vitamin C product surged ahead. The majority of sales here are to the food industry. Looking at the pharma business, the all inclusive service - from basic ingredient to marketing authorization to finished medicinal product - is gathering momentum. The range includes hormone preparations, antibiotics and diuretics.
After the previous year's rather disappointing results for the global fertilizer business, a good increase in profits has now been achieved.
In its role as a marketing Group HELM is increasingly performing tasks for the manufacturing industry in the fields of:
- International marketing
- Distribution
- Cargo terminals
- Scientific and technical services
Overall HELM benefited from price increases in the first and second quarters of 2003 and from good volume growth for the core products, meaning that market share has been increased in a year that has, on the whole, not been very easy.
2. FINANCIAL YEAR 2003 IN FIGURES
Projected sales
- HELM global EUR 3,400 million (year before 2,783m.) - increase 22%
- External sales EUR 1,910 million (year before 1,640m) - increase 17%
consolidated for Group
Group earnings from normal business
2003 projected EUR 40 million (year before 27 million) - increase 50%
Net earnings for the Group
2003 projected EUR 26 million (year before 19 million) - increase 37%
Across the world 1,174 men and women are employed by the Group, 490 of them work in Germany.
Roughly 60% of business activity is concentrated in Europe. As before, Germany, the USA and China remain the major single markets.
3. SITUATION ASSESSMENT
Although the world economy is still not particularly robust and there is no sign of any marked improvement in the chemicals industry, the HELM Group nevertheless suc-ceeded in closing the financial year 2003 on a positive note.
Among the internal and external reasons for these unusually positive developments were:
- marked price increases for petrochemicals in the first and second quarters of 2003, due to rising gas and crude oil prices. This particularly affected methanol, propylene and styrene.
- marked increases in fertilizer prices
- producers' efforts to trim their own distribution organizations
- competitors' problems
Internal reasons that are specific to HELM include:
- expansion of marketing activities / top of the class
- wide range of products
- expansion of scientific and technical services
- it is a family-owned corporation (AG)
- independent due to large capital reserves
4. STAFF
The second round of renewal at the top of the company has now been completed. The new management team consists of a balanced mix of long-serving HELM employees and new, highly qualified managers who have just joined the company; they work together as a professional, forward-looking team.
Again, there are no plans to reduce staff numbers, a slight increase is expected for 2004, as there was in 2003, especially in the scientific and technical sectors.
In addition to performance related salaries and bonus systems, a comprehensive range of social benefits is offered and there are no plans to change any of them. They include
- Christmas gratuity
- company kindergarten for children aged 3-10
- low-cost lunch of excellent quality in HELM's own, modernized canteen
- holiday apartments (seaside and mountain resorts) for HELM staff and their families on the island of Sylt, in Scharbeutz, on Rügen, in Braunlage and on the Vierwaldstät-ter Lake in Switzerland
- free car parking
- corporate sports
5. OUTLOOK AND INVESTMENTS FOR 2004
After four years of continuously rising earnings and a record year in 2003, we are not expecting to see further increases in 2004 due to a noticeable fall in fertilizer prices and very high freight rates, especially for bulk transport by sea.
The overall economic forecasts do not encourage us to expect anything different.
However, there are clear signs that 2004 will be a satisfactory year for us in every respect.
Just as producers invest, HELM will be making large investments over the next five years entitled
HELM - INVESTING in MARKETING.
In the coming years, 2004-2009, it is planned to invest a total of about EUR 65 million in expanding the marketing organization, on developing new products and on securing or extending existing distribution channels.
In concrete terms this includes
- Expansion of the distribution sectors for agrochemicals at
- Helm Polska Sp.zo.o, Warschau
- Helm Agro U.S. Inc., Memphis
- Helm de Mexico S.A., Mexico City
- Helm do Brasil Mercantil Ltda., Sao Paulo
- Helm Argentina S.r.l., Buenos Aires
- Building a chemicals distribution organization in China
- Extending the local chemicals sales offices in
- Oslo/Norway
- Manchester/England
- Bordeaux/France
- The Gulf region/Mexico
- Participating interest in production, Trinidad & Tobago
- Participating interest in production, Oman
- Expansion of the fertilizer terminal in Memphis
Although the world business environment is not favourable, HELM Group feels well equipped to face the future.
12 February 2004
HELM AG