From an overall economic viewpoint the 2016 financial year was again a particular challenge.
There was a renewed slowdown in the economic development of the global economy in the course of the 2016 financial year. For example the forecasts for growth in global gross domestic product (GDP) were scaled back from 3.4 percent in January 2016 to 3.1 percent in January 2017.
As already in previous years, growth was hampered by weak overall demand, but especially for capital goods. Among the factors exercising considerable influence on this development were the high level of political and economic uncertainty caused by political conflicts in Syria and Iraq, the failed coup in Turkey and the vote by the United Kingdom to withdraw from the European Union. Ahead of the US elections there were also growing signs that growth in America’s economy was slowing down. The Chinese economy continued its transition to an economy driven more by consumption and the domestic market, a process that so far has been accompanied by a steady decline in rates of economic growth. In Europe and Germany, on the other hand, the economy expanded by a moderate degree, as forecast.
Meanwhile business for the technotrans Group made very healthy progress in 2016. We achieved growth in all market areas and increased our revenue from EUR 122.8 million in 2015 to EUR 151.8 million in 2016. This quite marked rise in revenue comprises around 8 percent organic and around 15 percent non-organic growth.
Business with the manufacturers of offset, digital and flexographic printing presses made extremely good progress in the 2016 financial year. Following the gradual contraction of the printing press market in every year from 2008 to 2014, slight growth has resumed since 2014. In recent years technotrans has further increased its market shares with the manufacturers of offset printing presses and also tapped into new areas of business in digital and flexographic printing. We were consequently able to capitalise overproportionally on general growth in the past financial year. The drupa, the world’s largest exhibition for the printing industry, again proved to be another growth driver for its sector. At the Düsseldorf show from May 31 to June 10, 2016, technotrans presented itself to good effect as the development partner for virtually every area of business in the print world. As well as classic offset printing presses, a large proportion of flexographic and digital printing presses were equipped with technotrans peripherals for dampening solution preparation, filtration and ink supply. With revenue growth of approximately 8 percent in new mechanical engineering business, our overall development outstripped that of the printing press market itself.
The area of laser, machine tool and forming technology presented a mixed picture in 2016. In our business area of laser system manufacturers, the start of the year saw us experience the first ever slight drop in revenue since venturing into this industry. This was prompted by a product change at one of our largest laser customers. Nevertheless, our business with cooling systems for the laser industry started to recover from the second quarter.
As system partner to the laser industry, the areas of application span classic laser applications in metal working, medical equipment, semiconductor technology and the machining of new materials. The area of diode laser systems and 3D printing developed particularly well in 2016.
Classic mechanical and plant engineering was in rude health from technotrans’ perspective in 2016. Demand for both filtration systems and classic machine cooling picked up significantly thanks to strong portfolio business and the acquisition of new customers. Our business with the manufacturers of die-cutting and pressing equipment, which we supply mainly with spray lubrication systems and cooling units, likewise developed positively. Having supplied mainly smaller spray lubrication systems to our customers in recent years, 2016 saw us secure our first customer contract for a wider-format spray lubrication system. This took us a decisive step closer to the business area of vehicle body manufacturing, which we believe holds ample promise for us. With revenue growth of about 5 percent, we are satisfied with the business performance in the mechanical engineering segment.
In our so-called growth markets, the most promising progress was in the battery cooling sector, alongside the areas of medical technology and baggage scanner cooling. We have a presence in the medical technology area with cooling units for laser systems and cooling units for x-ray systems. In the field of scanner cooling, we are able to turn the more rigorous standards to our advantage. These standards require more precise checks on items of baggage, which in turn necessitate very elaborate thermal management.
The potential for electric mobility to become an exceptionally important area was reflected in the steep rise in project enquiries and orders in 2016. technotrans has now been working on innovative solutions for the thermal management of batteries and buffer stores for the past decade. We have developed into a specialist for niche applications and small production runs in the transport sector and for charging points. Our products can now be found not only in trams and buses, but also in container and commercial vehicles as well as in charging points.
With revenue growth in excess of 50 percent, we remain on track for success here.
All our products have one thing in common: they need maintenance and service throughout their entire operating life. technotrans is exceptionally well positioned in that regard compared to its mostly mid-corporate market competitors. This is because we are in a position to offer all customers in all segments precisely the service that they require of us. That protects both our competitive position and our profitability.
Our Services area includes our Technical Documentation arm. Here, we compile user manuals, operating instructions or handbooks on behalf of customers. We also offer our customers a translation service and accompanying software management systems for document administration. So that we will be in a position to continue to offer our customers precisely the management system that meets their needs, we expanded our operations in this field in 2016 by acquiring majority interests of 51 percent in Ovidius GmbH and its subsidiary EasyBrose GmbH. These companies develop XML-based content management and editorial systems.
Flanking our organic development, we also completed the company’s largest ever acquisition in 2016: in August 2016 we acquired a 98 percent majority interest in the share capital of GWK Gesellschaft Wärme Kältetechnik mbH, with registered office in Meinerzhagen. Through this acquisition we have opened a gateway to the market of the plastics processing industry. GWK already played a major part in the revenue performance of the technotrans Group in 2016 with consolidated revenue of EUR 18.0 million.
Ladies and Gentlemen, looking back over 2016 we conclude that it was a highly demanding year, not merely politically or for the economy as a whole. 2016 was also very challenging for the technotrans Group in every respect. And yet, the past year was again the most successful since the financial crisis of 2008. We achieved a huge amount and also took landmark decisions to support the long-term positive development of the company. technotrans today has a broad market spread and offers focused technological solutions. That makes us ideally equipped for the “Next Step”, to quote the motto of this year’s Annual Report. This is how we see our company, and how we would also like to continue developing in the future. That it works is all down to a high-performing, responsive workforce and a stable shareholder base, represented by a competent Supervisory Board. On behalf of the Board of Management I take this opportunity to extend my sincere thanks to them all for making our undertaking such a success.
On behalf of the Board of Management