Freudenberg, the internationally active family company, grew sales for the third year in a row in the 2012 financial year, recording yet another all-time high in the history of the company spanning more than 160 years.

At year-end 2012, sales ran at €6.322 billion (previous year: €5.992 billion). This represents a year-on-year increase of €330 million or 5.5 percent. Profit from operations (EBIT) amounted to €538 million (previous year: €517 million). Consolidated profit ran at €433 million (previous year: €370 million).

The consolidated financial statements were drawn up at Freudenberg SE level. In May 2012, Freudenberg Societas Europaea (Freudenberg SE) with responsibility for managing business operations was set up under the umbrella of the strategic management parent company Freudenberg & Co. Kommanditgesellschaft. There have been slight changes to the consolidated group.

Freudenberg SE brings together all operating business with the exception of Freudenberg & Co. Kommanditgesellschaft and its Freudenberg Service Support and Freudenberg Insurance Divisions. The sales and headcount of these companies are no longer included in these financial statements.

Prior-year figures for the consolidated group used for comparative purposes have been adjusted accordingly. However, a direct comparison with figures published for the previous year is only possible to a certain extent, because prior-year data refer to the financial statements of Freudenberg & Co. Kommanditgesellschaft.

“Freudenberg successfully held its ground in a particularly challenging market environment and achieved strong and profitable growth in many areas. Our broadly diversified product portfolio and our global presence are the foundation for our success,” Dr. Mohsen Sohi, Speaker of the Board of Management of the Freudenberg Group, said at the Annual Press Conference in Weinheim on Wednesday.

“Freudenberg was able to grow sales further thanks to innovative products, a high degree of customer orientation and flexibility as well as structured and sustainable expansion in growth markets.” Although the financial and debt crisis impacted business in markets in Southern Europe, the decline was offset by growth in the BRIC countries and in North America.

Profit from operations (EBIT) rose by €21.3 million year-on-year to €538.0 million. Consolidated profit improved by €62.9 million to €432.7 million. This includes a special effect as a result of setting up the TrelleborgVibracoustic joint venture.

Apart from the higher profit, active working capital management contributed to an improvement in cash flow from operating activities, which increased year-on-year by €152 million to €532.2 million. Investments rose by some €86 million to €348.1 million (previous year: €262.1 million). The equity ratio increased to 46.5 percent (previous year: 45.0 percent).

At year-end, the Freudenberg Group workforce totaled 37,453 employees (previous year: 36,529), an increase of 2.5 percent on the previous year. This is mainly attributable to increases as a result of acquisitions and to the proportional allocation of associates under the 50:50 TrelleborgVibracoustic joint venture.

Current developments

The market environment for the Freudenberg Group remains challenging in 2013. European countries in particular continue to be severely affected by the financial and debt crisis. The company expects to see the situation in the key sales markets of Italy and Spain deteriorate. In contrast, the BRIC countries will drive the global economy.

Business development in the first half of 2013 will be satisfactory as a result of the good order situation in almost all Business Areas, combined with the anticipated generally stable economic trend.

The company expects to see noticeable growth momentum in the second half of the year, particularly in the mechanical engineering sector. “We anticipate strong growth in China, an important sales market for Freudenberg, with India and Brazil picking up considerable speed and the USA generating stable growth,” Mohsen Sohi underscored. The company expects to see minimal growth in the eurozone. Freudenberg remains cautiously optimistic.

Risks relating to the company’s performance in 2013 arise from the high volatility of raw material prices and the availability of raw materials as well as lower contribution margins as a result of changes in the product mix. The Freudenberg Group is responding to this with a further increase in productivity, the use of substitute raw materials, and targeted purchasing initiatives.

About the Freudenberg Group

The Freudenberg Group is a family company offering its customers technically challenging product solutions and services. The Group develops and manufactures seals, vibration control components, filters, nonwovens, products for surface treatment, release agents and specialty lubricants, medical and mechatronic products. And especially for mid-size companies Freudenberg develops software solutions and IT services.