02 Apr 2008
Growing the solar business is a key focus for the company in 2008, while it also plans to divest its remaining optics interests to streamline its portfolio.
Growth for the Oerlikon Group accelerated in 2007, with organic sales growth of 20% boosting sales to CHF5.6 billion ($5.55 billion). Operating profit of CHF496 million represented a 15% increase over the previous year.
Oerlikon's solar business was singled out as a particular success story, posting sales of over CHF300 million and obtaining orders from CMC Magnetics and Auria Solar, the first orders from customers in Asia. Combining all the group’s solar-related activities into the new segment was said by the company to ensure that the its solar business can handle the growth rates of more that 50% year-on-year now being predicted.
"Further expansion of the solar business will be a focal point for Oerlikon in 2008," chairman Georg Stumpf told analysts. "The solar business opportunity Oerlikon now has is a once in a century opportunity."
The news was less positive for Oerlikon's Components segment, which includes Oerlikon Optics. Sales growth for the segment of 2.3% to CHF344 million for 2007 only came about after a product offensive from the Esec business unit, suppliers of equipment for the volume assembly of semiconductor devices, and additional growth from Oerlikon Space.
The third segment, Oerlikon Optics, was restructured during the year but will now be divested because it is judged to be a poor fit with the group's portfolio. The reasons given included low growth prospects for the back-projection TV business and the complexity of the optical component business. Taken together with Oerlikon's sale of its Blu-ray DVD manufacturing interests earlier this year, the move represents a clear change of strategy for the company.
"We are focusing in a very stringent and strict way on streamlining our portfolio," said Stumpf. "Even with the positive outlook for Blu-ray disks, a CHF60 million asset is not a segment we want to focus on. Similarly, the Optics division also has sales of about CHF60 million and represents only 1 or 2% of our sales. Divesting these businesses gives a clear sign to the market that we are cleaning up our portfolio."
The Optics business will be sold within the next two or three months, according to Stumpf. Oerlikon Coating, which supplies equipment for fabricating optical thin films and other coatings, is unaffected by the move.