Acquisition of nie wieder bohren ag strengthens consumer business – further acquisition complete
The integration of nie wieder bohren ag, which was acquired in March 2017, was successfully concluded. The company, which is based in the German city of Hanau, produces hooks and bath accessories based on the patented affixing solution of the same name (which means “never drill again”). They can be removed without a trace afterward, offer ultra-strong hold, and are the perfect complement to the tesa range of smart mounting systems. Sales were already up significantly during this reporting year. The acquisition also helps tesa tap into new customer groups, particularly in the commercial segment.
tesa concluded another acquisition in March 2018, acquiring the Twinlock product division of Polymount International BV, based in the Dutch city of Nijkerk, near Amsterdam. It manufactures and markets a patented technology for mounting printing plates worldwide. The move strengthens tesa’s position on the market in the flexo printing segment, a key pillar of the industrial business. Gereke comments: “We are continuing to pursue our approach of using acquisitions and stakes in other companies to bring supplementary know-how into the company and accelerate our growth.”
Industry: strong growth in products for smartphones, tablets, and cars
The Direct Industries division, which accounted for 57.6% of sales (previous year: 55.8%), achieved sales growth of 15.9% in organic terms. The project business with the electronics industry, which focuses on Asia, saw significant growth in particular. Product launches such as a new generation of tesa Bond & Detach® for adhesive bonding of batteries in smartphones that features highly improved adhesive and shock absorption properties and a new type of double-sided adhesive foams for affixing touchscreens to smartphones and tablets provided significant impetus. The automotive business was another growth driver again, especially in the United States. The focus here was on various products, including masking systems for the two-tone paint jobs that are currently on trend and the company’s newly launched double-sided water-based – and thus ecofriendly – tapes for adhesive bonding in vehicle interiors.
Trade: smart affixing solutions introduced in additional countries
The Trade Markets division, which encompasses both the business in products for consumers and craftsmen and those industrial markets that that are reached via the technical trade or retail-like channels, saw positive development, with organic growth of 3.8% in sales.
In the business dealing with products for consumers and professional craftsmen – Consumer & Craftsmen – which is focused on Europe and Latin America, tesa strengthened its market position in all regions and all channels. tesa gained significant market share in the important DIY, craftsmen, and stationery markets. The ongoing success of tesa Smart Mounting Solutions (tSMS) played a key role in this. The products were launched in Austria, Switzerland, Belgium, the Netherlands, Spain, Poland, Italy, Portugal, and France in 2017.
In the General Industries business segment, high-quality double-sided special tapes used for adhesive bonding of design elements and functional elements in household appliances such as refrigerators saw particularly positive development.
Asia posts strong growth; Europe grows by 6.2% again
The strongest growth in sales came in the Africa/Asia/Australia business region, at 19.6%. The driver was the project business with the electronics industry, which focuses on Asia and had regained its previous strength. This region’s share in Group sales increased to 28.6%. The business in Western Europe and Eastern Europe also posted very positive development despite high market saturation, with organic growth of 6.2% once again. Europe’s share of total sales declined slightly, to 56.2%.
Group-wide, the number of employees rose to 4,457 (previous year: 4,158).
Outlook for 2018
The familiar geopolitical risks and their effects on the development of the overall economy will affect tesa’s business again in 2018. In Europe, the stable trend is expected to continue, while developments such as the planned “Brexit” and the situation in Turkey could have negative effects on the markets. The ongoing recovery in the economies of Southern Europe is expected to further strengthen both the distribution business and the end customer business. In Asia, tesa expects to see moderate growth in 2018, depending on how the economy performs, which is difficult to predict. tesa will participate in this growth in both the automotive and electronics segments. The business with the electronics industry, which is concentrated in Asia, remains attractive, but the project-related nature of this business continues to pose a risk of fluctuations. tesa views the automotive sector as an important growth field among global customers. It will generate positive impetus once again in 2018, especially in North America. The euro strengthened over the course of the year in 2017, which will have a slightly damping influence on the development of tesa’s business in 2018. Consistent ongoing investments in research and development, and thus in innovative products, will strengthen tesa’s market position with sustained effects.
On this basis, tesa expects to see sales growth that slightly outperforms the market in 2018, at 3 to 4%, and expects the operating EBIT margin to come in slightly below the previous year’s figure.
2017 business development online
Current business figures and further information are available in the 2017 business development overview, which is included in this press kit and is also available online at www.tesa.de/investor-relations.