Press

10.06.2009 - Wedemark

Sales remain stable at audio specialist Sennheiser

Sennheiser electronic GmbH & Co. KG presented its balance sheet for fiscal year 2008 today. At €385.8 million, total sales at the audio specialist were 2.4% lower than in the previous year (€395.3 million). “While product sales remained stable, the strong currency losses for the US dollar and the pound sterling resulted in a slight fall,” explained Volker Bartels, Speaker for the Executive Team. 
 

The Sennheiser Executive Team (from l. to r.): rear: Paul Whiting (President Global Sales), Stefan Junker (President Global Controlling and Finance); front: Sabine Wittenbrink-Daut (President Global Human Resources), Susanne Seidel (President Global Marketing), Volker Bartels (President Global Manufacturing and Logistics) and Dr. Heinrich Esser (President Global Research and Development)

Earnings in fiscal year 2008 were €14.8 million (previous year: €20.2 million), a fall of 26.7%. “That is a significant decline, but in view of the global economic situation a better result could hardly have been expected,” Bartels continued. The fall in earnings is above all due to expenditure on new large-scale projects and the expertise required. “In developing completely new headphone technology for the top-of-the-range HD 800 model and two new wireless microphone series, we have invested in stability and in the future,” Bartels said. “All products were very successfully launched this year.” Higher personnel costs and start-up losses for the new subsidiaries in Japan, India and China also had an influence on earnings.   On average throughout the year, Sennheiser’s worldwide workforce increased to more than 2,100 employees (+7.1%). Of these, 55% work in Germany. The company also trained 56 apprentices in 2008 (previous year: 51).    Growth in Asia, Central Europe and Eastern Europe The Europe, Middle East and Africa (EMEA) region remained stable, and the slight growth of 0.2% was achieved above all by Eastern Europe (+19.6%)

and Central Europe (+4.3%). Total sales in the region were €253.7 million, compared to €253.1 million in the previous year. In Asia and Australia, Sennheiser increased its sales by 6.8% to €40.4 million, up from €37.9 million in 2007. The Americas, which were most seriously affected by the economic crisis, fell by 12.1%, although the Latin American market enjoyed a positive development. Sales in the Americas overall decreased from €104.3 million in 2007 to €91.7 million in 2008. 
 

Sales revenue 2008 by region
 
With a 28.7% share of sales, headphones are still Sennheiser’s largest product segment, and recorded a slight growth of 0.3% in 2008. At 26.2%, wireless microphones are the second largest contributor to sales revenue, and these experienced a slight drop in turnover of 2.1%. All other segments – wired microphones, Sennheiser Communications, conference and information technology, audiology, Georg Neumann, aviation and Klein + Hummel – each generated less than 10% of total sales.
 

Positive action in the economic crisis
In addition to extensive cost-cutting measures, short-time working was introduced at the German production plants from April onwards. “We are employing this tool in order to reduce the burden of costs and at the same time to avoid losing highly trained and highly qualified employees,” explained Volker Bartels. “I should point out, however, that our reduction in working time by four hours a week is far less than the national average.”
 

From July, production workers will be able to use the free time for further training. Sennheiser has modified the qualification programmes of the German Federal Employment Agency to meet its own requirements and in close consultation with the Agency. The company is applying for funding for the programmes. 
 

The HD 800

Bartels is expecting a slow recovery in the second half of the year: “2009 is the more difficult year; however, we have successfully launched a series of new products that are now ready for delivery.” These include the HD 800, which is manufactured in Germany, the evolution wireless G3 microphone series for musicians, and the 2000 Series, a new professional wireless series for PA rental companies and broadcasting.    In order to maintain the company’s technological lead, 7.4% of sales was invested in research and development in 2008, equivalent to €28.7 million

(€24.9 million in the previous year). In this sector alone, 27 new employees were taken on. Investment rose from €13.2 million in 2007 to €20.9 million in 2008.
  
New production facility on schedule

Topping-out ceremony for the new production facility on 18 May 2009

In the meantime, the new production facility at the company headquarters in Wennebostel is progressing on schedule. Relocation of production to the new building will take place towards the end of the year. Volker Bartels: “Ultra-modern workplaces with optimum workflow and close cooperation between production and development will further improve our efficiency and have a positive effect on our success. This is an investment in our future. By taking these measures, the company management has reacted prudently to the current crisis; we are now hoping for a speedy recovery in the economy.”