Bühler continued to invest into new markets and applications
and spurred on its growth.
In 2016, Bühler showed an ongoing healthy performance. Order intake increased substantially and turnover grew markedly. Profitability remained stable despite challenging market conditions such as volatile currencies, low raw material prices for oil and wheat, and political turmoil in many regions. The service business showed more-than-proportional growth. The Group continued to strongly reinvest its cash into strategic applications and markets. Market positions were strengthened by rolling out new technologies, process solutions, and services, and by adding new production capacities, for example for a manufacturing plant and equipment for rice processing in Vietnam or animal feed production in China. At the same time, Bühler launched a modernization program for its Swiss locations in the second half-year. Committed to sustainability, Bühler made further progress in providing solutions for meeting pressing challenges in the fields of nutrition and energy efficiency and in utilizing the potential of digitalization for its customers as well as its own development. The sound financial position of the company was further strengthened, e.g. by a remarkable increase of net liquidity. The carefully planned change in the top management went off smoothly and triggered new impetus – supported by the renewal of the Bühler brand.
On a growth path
Our growth stimulus was most evident in the higher order intake. Here, the Group achieved a turnaround in comparison to the previous year: Whereas order intake in 2015 shrank by 4 %, it increased in 2016 by 3 % to CHF 2.54 billion – a bridge of 7 percentage points. Turnover grew perceptibly by 2 % to nearly CHF 2.45 billion. Consequently, the already high order backlog reached a record high of CHF 1.6 billion. Profitability (EBIT) remained stable at CHF 174 million, which corresponds to an EBIT margin of 7 .1 % (previous year: 7 .3 %).
Strong financial position
Net profit remained stable at CHF 143 million. Again Bühler invested a high amount (CHF 71 million) into its worldwide asset base. Despite these expenditures, net liquidity grew significantly by 18% to CHF 462 million. With an equity ratio of 47 % (previous year: 46 %), the Group is free from all bank liabilities on the reporting date at year-end. The return on net operating assets (RONOA) stayed on a high level of 19 % (previous year: 22 %). With this strong financial position, Bühler is well equipped to continue investing into its own future.
Both business areas of Bühler, Grains & Food and Advanced Materials, contributed to the success of the Group in 2016. The strategy of engaging in two business areas that are both based on leading process technologies, services, and training offerings, and which serve a wide range of industries, has proven its worth. Grains & Food further expanded its market leadership in 2016. Advanced Materials continued its upswing after a strong 2015.
In line with its strategy of operating “in the region for the region,” Bühler invested substantial sums in 2016 to enter new markets, develop new applications, and further expand and update its global manufacturing network. Eight new service stations were added to the global network of nearly 100 locations with 60 workshops increasing our proximity to our customers; in Vietnam, a new factory for rice equipment was opened; new regional application centers were established, for example, in North America; the buildup of a new production site in China is ongoing; the company launched a modernization program for its locations in Switzerland and is about to capture the future growth markets of battery and insect processing.
From a sales perspective, the investment into the global service network is now beginning to pay off. Customers appreciate our ability to serve them locally out of one of 92 service stations worldwide. This resulted in a gain of 7% to CHF 578 million, with which the service business showed an overproportional growth rate. The service share of turnover is now 24% (previous year: 22%).
Retrofits and new online platform MyBühler
The activity contributing to this upturn was not the spare parts business alone, but also services such as retrofits. These extensive service packages are designed to update existing plants and equipment, ranging from single system components to complete overhauls using cutting-edge technologies such as automatic control systems. Bühler differentiates itself with a holistic approach ranging from mechanics over electric installations to automation and integration into ERP systems. Customers benefit from higher yield, quality improvements of end products, less downtime, and lower energy consumption.
The introduction of the MyBühler online customer platform (www.mybuhler.com) was also of strategic significance to the services business. Customers registering with this portal find their Bühler products in it and can place online orders for spare parts. Several hundred pilot customers are already benefiting from this service. Plans are in place to greatly expand the range of services and the number of customers using it.
|Bühler is fully committed to sustainability with the ambition to contribute to a safe and secure global nutrition system as well as a responsible usage of natural resources to limit the effects of climate change. Sustainability was confirmed as the overarching goal and cross-company targets were agreed. Since 2013, the scope of the sustainability reporting of Bühler has continuously increased, now covering 17 major locations with 92 % of the productive work hours and 39 Key Performance Indicators (KPIs) (see Sustainability Report on pages 83–97). In 2016, Bühler has reduced its own CO2 footprint by 15%. By the year 2020, Bühler plans to reduce energy consumption and waste at customer sites by 30 %.
Bühler’s key lever to support these efforts is innovation: With new technologies and solutions the Group transforms global challenges and trends into new business opportunities. With this in mind, Bühler is placing the focus on two core topics of the future: sustainability (nutrition; availability and safety of foods and feeds; energy efficiency) and digitalization (Internet of Things).
Bühler Networking Days
The Bühler Networking Days 2016 held in Uzwil at the end of August demonstrated just how seriously the Group is taking its responsibility as a major industry player. Bühler convened 750 participants from the global grain processing industry – customers, scientists, industry partners, start-ups, and apprentices – in order to discuss ways and means to together develop ways of translating urgent challenges into new business opportunities.
The Networking Days, during which Bühler presented over 30 innovations, are representative of Bühler’s open, collaborative-innovation model that experienced a further push in 2016. The Group invested CHF 109 million in Research and Development, which corresponds to a share of turnover of 4.4% (see Innovation Report on pages 36–39); incurred a partnership with the start-up accelerator MassChallenge; started a cooperation with Bosch to develop IoT-based solutions; and invested into a joint venture with Protix from the Netherlands to enter the market of proteins from insects.
|A key element of Bühler’s sustainability approach is training and education, not only for its employees, but also for customers. The African Milling School, which was inaugurated in March 2015, was a great success: The training courses are fully booked and the first class just finished their exams. Bühler operates 17 training centers globally offering more than 1,500 seminars for all aspects of its technologies and solutions. Bühler’s well regarded apprentice program was continued at the same level, now employing 579 trainees in Switzerland, Germany, USA, Brazil, South Africa, China, and India.|
Bühler’s reputation as a global player and a good employer was confirmed in an impressive manner. Several internal and external studies underscored that Bühler is one of the leading employers globally and that its workforce strongly identifies with the company. Important indicators such as fluctuation and length of employment are far better than the industry average, confirming the high level of employee satisfaction. Overall, fluctuation decreased from 9.1 % in 2015 to 7.5 % in 2016. The background of this positive perception is a deepseated corporate culture of mutual respect. Bühler places the greatest importance on top qualifications, supports its employees in receiving training, and also enables them to continue their education.
A new introduction in 2016 was the Management Trainee Program, in which seven new university graduates are offered the chance to closely follow a member of the Executive Board of Bühler for 12 months and thereby gain an in-depth understanding of corporate management.
Bühler closed a healthy year of operations in 2016. Regardless of day-to-day variations, the Group with its various business fields is excellently positioned in global growth markets – the processing of basic foods and advanced materials. With our global setup, we have achieved real customer proximity and we truly live up to our motto of being “locally relevant, globally leveraged“. Today’s megatrends such as the growing global population, increasing urbanization, or enhanced environmental awareness further benefit the strategic setup of the Group and unlock additional growth potential.
With our accomplishments in 2016, and a strong order backlog, we can look confidently toward 2017. The dynamic nature of market and technology trends, regional developments, and political conditions makes predicting potential business outcomes increasingly challenging. Though we live in a fast-moving and complex world, Bühler has adjusted to whatever situation it is presented with, with flexibility. Our collaborative innovation model and strong partnerships with our customers, the science community, and with technology and industry partners enable the company to be adjusted as needed. In conjunction with our leading technologies and solutions, we aim to further increase our growth rate and profitability in 2017.