Sennheiser 2009 Annual Report Download - page 30

58 CON S OLID ATED MANA G EMEN T RE P ORT 2 010 59
CON SOLI D ATED MANA GEME N T RE P ORT 2010
Asset Position
The balance sheet total increased from €230.2 million in the previous year to €278.0 million in
2010, primarily on account of a rise in inventories and current receivables. Demand, which
suddenly soared in spring 2010, particularly resulted in inventories increasing.
Shareholders’ funds (comprising equity and liabilities to shareholders) came to €131.2 million
(47.2% of the balance sheet total), therefore rising by €21.0 million compared to the previous
year despite their share in the balance sheet total having dropped slightly. Pension provisions
went up from €52.2 million in the previous year to €62.2 million, mainly on account of adjust-
ments made in connection with the Accounting Law Modernization Act (BilMoG). In addition,
other provisions increased by €13.4 million and current liabilities by €1.8 million.
Financial Position
Cash flow from current business activities came to €23.2 million (compared with €26.5 million in
the previous year) and covered the Group’s investment and financing activities. Cash and cash
equivalents went up by €9.3 million to €28.4 million.
Purchasing
Financial year 2010 was characterized by a global supply bottleneck of electronic components.
Business relationships with suppliers focus on the long term. Together with the Group-wide
coordinated purchasing activities, they helped Sennheiser realize higher production volumes
than originally planned. Although global investment backlog, which had started to build up
during the financial crisis in 2008 and worsened considerably in 2009, resolved itself again to a
large extent in the previous year, it still created long delivery times due to limited production
capacities. This affected almost all materials areas, but particularly electronic components.
The company further extended its network of alternative suppliers to increase the reliability of
its purchasing activities. Despite the supply situation remaining tense in the electrical and
electronics industry, this ensured that purchase prices stayed largely within the budget. The per-
centage of purchases made in the US dollar zone went up slightly year on year to around 75%.
The steadily climbing prices in the global market for basic raw materials and the structural
changes in China, where minimum wages are rising significantly, had a considerable impact on
price developments and prices will increase as a result in 2011. The supply situation in the elec-
trical and electronics industry will stabilize, making large materials bottlenecks unlikely. But as
delivery times continue to be long, purchases still have to be carefully planned in advance.
Production Companies
The general conditions for the German production site were primarily impacted by the merger
of the two German sites into the new production and technology center in Wennebostel. But
despite these developments and after a slow start to financial year 2010, production output
and turnover were significantly increased in the second half of the year. Turnover went up 15.1%
year on year, with production still focusing on the manufacture of microphones. In 2010, the
project for increasing the production volumes of wireless microphones in Germany was conclud-
ed with the aim of once again covering European demand with products produced in Germany.
The company implemented measures with regard to materials availability, inspection equip-
ment and personnel use so as to be able to increase its capacities as required. In order to
improve efficiency and increase added value, production employees participated in numerous
lean management workshops. Across all areas, many suggestions for improvements in the
workplace were made and quickly implemented. This helped to increase production employees’
satisfaction in the long term.
In 2010, Sennheiser Consumer Electronics GmbH’s sites in Ireland and Singapore generated
65.6% more turnover than in the previous year. This increase was achieved by measures such as
the targeted stockpiling of core products to ensure the company’s ability to deliver at the end
of the year. The Irish production site has by now been fully developed from a headphones
manufacturer into an internal supplier and specialist for acoustic transducers. The Group
continued to invest there in 2010 to expand its specialization in the production of high-grade
acoustic transducers.
The production site in Albuquerque, New Mexico, USA, was able to increase turnover in its local
currency by 4.3% compared to the previous year. In 2010, the site’s main focus of production
again was on wireless microphones and supplying production components to Sennheiser
electronic GmbH & Co. KG. The most important project in 2010 was the adjustment of produc-
tion capacities for wireless microphones in connection with the Wennebostel site.
The key objectives in financial year 2011 will be implementing the new company structure and
also further increasing production output. In order to ensure the Sennheiser Group achieves its
planned turnover growth, the company will have to continue sharpening its focus on the prin-
ciples of lean management in its processes. By implementing standard processes, any future
potential can be targeted at further improving efficiency and effectiveness. This considered,
Sennheiser will again ensure profitable growth in 2011 while maintaining excellent quality to
secure the Group’s production sites in the long term and to further expand them.
Development
Outlook
Outlook
Development