HARTMANN weathers the unfavorable environment
March 27, 2012 Sales and profit growth in 2011: Despite the government budget cuts to address the euro debt crisis, which led to further spending cuts in the national health systems, HARTMANN successfully continued on its course in the fiscal year 2011. Compared with record sales in the previous year, sales revenues increased by 4.1% to EUR 1,699.4 million. On average in 2011, the company was confronted with significantly higher prices for raw materials and traded goods and was exposed to highly volatile exchange rates between the euro and foreign currencies. HARTMANN responded to this situation by implementing a Stabilization of Results Program at an early stage, increasing the EBIT by 4.1% to EUR 107.6 million.
Strong sales growth in the Infection Management segment
In the Wound Management segment, HARTMANN recorded an increase in sales revenues by 3.4% to EUR 455.7 million in the year under review. In product systems for modern wound management, the company benefited from strong sales growth in France and Russia. Despite the severe shortages in the cotton market, HARTMANN achieved further growth in traditional wound dressings as well as compression and fixation bandages. Within the business segment, the wide range of postoperative dressings had the strongest sales growth.
With sales revenues of EUR 610.9 million, Incontinence Management was again the segment with the highest sales in fiscal year 2011. Sales growth was 1.8% compared to the previous year. HARTMANN again recorded strong sales growth in MoliCare Mobile incontinence pants and the pads for light incontinence offered under the MoliMed brand name.
Infection Management was the fastest growing segment in the HARTMANN GROUP in 2011, with a sales increase of 10.1% to EUR 371.6 million. The company benefited from the increasing hygiene awareness of professional customers and end-users: within the scope of the prevention of healthcare- acquired infections (nosocomial infections), demand for disinfectants rose. Custom procedure trays and disposable surgical instruments were increasingly well received in hospitals and outpatient surgical centers.
The share of the three medical core segments in total sales was 84.6% as at December 31, 2011 and thus at the previous year’s level. In Other Group Activities, which include consumer products and the trading activities in medical products, HARTMANN achieved sales revenues of EUR 261.2 million in the year under review, an increase of 2.5% compared to the previous year.
Sales growth in Germany and abroad
Sales revenues in Germany increased by 3.7% to EUR 583.9 million while sales revenues outside Germany increased by 4.3% to EUR 1,115.5 million. The foreign share thus remained almost unchanged at 65.6% compared to the previous year.
EBIT and consolidated net income further improved
In 2011, the HARTMANN GROUP responded to the sharp increase in raw material prices at an early stage by rapidly implementing an internal Stabilization of Results Program, reviewing major cost blocks in the Group and selectively implementing cost saving measures. In addition, prices of products affected by higher raw material costs were increased. These measures have enabled the company to compensate for the negative impact on the results. On this basis, HARTMANN increased its EBIT by 4.1% to EUR 107.6 million compared to the previous year. The consolidated net income was EUR 70.8 million, an increase of 1.3% compared to 2010.
Equity ratio increased at high level
The Group’s equity capital, including minority interests, increased by EUR 42.7 million to EUR 612.3 million in fiscal year 2011. Equity ratio improved from 50.2% in the previous year to 53.9% at 2011 year-end. Net debt of the HARTMANN GROUP decreased by EUR 39.8 million to EUR 132.8 million compared to the previous year.
Number of employees stable
At the end of 2011, the HARTMANN GROUP had 9,966 employees worldwide, a reduction of 16 employees compared to the end of 2010. 3,850 of these employees worked in Germany, with 6,116 in foreign subsidiaries. This is a ratio of 38.6% to 61.4%.
Proposal to raise dividend to EUR 5.50 per share
At the Annual General Meeting on May 4, 2012, the Management Board and the Supervisory Board will propose a dividend increase from EUR 5.40 to EUR 5.50 per share. With this proposal for the appropriation of net income, the dividend yield is 3.0% when related to the 2011 year-end rate.
Outlook
Despite the uncertain effects of the euro debt crisis and the slowing global economy, the HARTMANN GROUP is well positioned to successfully continue its growth strategy even under difficult market conditions.
HARTMANN intends to distinguish itself internationally even further as a system provider of value-added process optimization solutions in the areas of controlling, ordering and logistics.
The company will use the professional infection protection competence bundled in the BODE SCIENCE CENTER to effectively combat the growing number of healthcare-acquired infections.
In the current year, HARTMANN also will thoroughly explore possibilities under its growth strategy to sensibly expand its portfolio of products and services through selective acquisitions or, on the other hand, to improve its position in selected markets.
The HARTMANN GROUP will also continue on its growth path in the current year, investing in sales, manufacturing and logistics infrastructures. A high priority is placed on the Russian market where the company has grown by one-third on average annually in the past five years and has taken on great significance in the market.
CEO Dr. Rinaldo Riguzzi: “Considering all relevant factors, we are cautiously optimistic for the current year that we will have slight growth in sales revenues across the four business segments. In the face of a difficult environment, we expect consolidated net income for 2012 to be at the high level of the reporting year.“
