Dedicated Analytical Solutions

21-03-2013

FOSS achieves best financial result ever

The revenue in 2012 increased with 9% to 1,739 million Danish kr., showing a healthy and organic growth of the company. More than 98% of FOSS products were sold on its export markets. Growth in recent years has mainly happened in Asia / Pacific and Latin America.

"2012 was a challenging year where we have seen several regions around the world been affected by low growth, and our customers are squeezed by high raw material costs. However, we are happy with the progress, although we had bigger ambitions. Therefore, we maintain our ambitious growth strategy”, says CEO Torben Ladegaard.

“In all major markets we have seen an increased interest for FOSS instruments and services, which in time of crisis can be the food manufactures best weapon in the battle for margins. Our analytical instruments help to streamline and control the production and optimize the utilization of raw materials. We see a significant increase in the global middle class, which leads to a change in food habits towards processed food in high quality and safety, a trend we expect will continue over the next several years and thereby increase FOSS market opportunities ", Torben Ladegaard continues.

A year of investments
2012 was a year driven by investment, not least in the interface to our customers. The newly established sales company in Mexico has grown to over 40 employees and the total sales force is increased by 25-30% in BRIC countries and the U.S.

The investments in research and development to produce new products, is an essential part of FOSS values. In 2012 several new product development projects were started, and we thereby continued to invest heavily in new opportunities for the long-term growth. The FOSS investment in R&D was in 2012 over 160 million kr. Production facilities in China have been significantly expanded and the presence in Denmark is also enforced by the building of the 12.000 m2 FOSS Innovation Center in Hillerød. The new building will be inaugurated on the 3 April 2013 by Crown Prince Frederik.

The year ahead
FOSS is well prepared for the future both regarding market and products, and expect the growth to continue in 2013, especially in countries outside Western Europe. Investments in sales and distribution activities will continue in 2013 and this is expected to strengthen FOSS’ market position and to help realize the growth strategy delivering solutions to the growing demand for quality foods. Amongst the customers we expect a continued reluctance to commit to investment budgets, and even small changes in customer liquidity and funding conditions can cause significant changes in the Group's markets.

Ownership
Shareholders have previously owned FOSS A/S partly directly and partly indirectly through N. Foss & Co.. A/S. In 2012 the shareholders have simplified the structure and completed a share exchange, so that the family now owns FOSS A/S 100% through N. Foss & Co. A/S. At the same time the capital structure has changed by placing the Group's future surplus cash in the holding company. The aim is to have a more clear focus on the core business of FOSS A/S on the core business (rather than capital investment) and also to maintain a strong capital resource in the Group in the event of opportunities for acquisitions.

About FOSS
FOSS is the world’s leading producer of innovative analytical instruments for the global food and agricultural sectors, and thereby contributes to the optimal use of raw materials, better food quality and safety. FOSS provides solutions to the world’s 100 largest food companies. FOSS has more than 1200 employees globally. Development and production takes place in Denmark, Sweden and China and FOSS has more than 28 sales and services companies globally. The family-owned company was founded by Nils Foss in 1956.

Financial highlights
Selected highlights from Annual report 2012/2011 (mill Danish Kroner)

     2012     2011 
Revenue    1739    1596
Profit before financial income and exspenses (EBIT)      351    339
Year result    326    221
Total assets    2333    2081
Equity    1899    1649
Key numbers        
Revenue growth    8,9%    6,5%
Profit before financial income and expenses vs. revenue    20,2%    21,2%
Solvency ratio    81%    79%
Export    98%    98%
Number of employees    1237    1175

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