Bosch releases 2012 Southeast Asia financial results

Bosch releases 2012 Southeast Asia financial results

Bosch, a leading global supplier of technology and services, closed its 2012 fiscal year at US$887 million (SGD 1.13 billion) in sales in Southeast Asia to realize a remarkable increase by almost 30 percent. Singapore was the top contributor in sales to the region, netting SGD 390 million (243 million euros) to achieve a resounding year-on-year increase of over 85 percent. "Southeast Asia is currently the fastest growing region for Bosch, and we expect to maintain this growth momentum and achieve double-digit growth for 2013," said Martin Hayes, president of Bosch in Southeast Asia.

Amidst the rapid growth within Southeast Asia, Bosch also saw an overall healthy increase of nine percent in manpower for the region, and seven percent locally at the regional headquarters in Singapore. This growth was amplified in the developing countries of Indonesia, Philippines and Vietnam, raising headcount by more than 35 percent per country, year on year.

Bosch further increased its footprint in Southeast Asia with the opening of a representative office in Yangon, Myanmar, earlier this year in April, and offices beyond the capital cities of Thailand and the Philippines into Chiang Mai and Cebu respectively in May this year. Last year, the company expanded into Da Nang, Vietnam, and Medan, Indonesia. This year, it broadened its presence in Indonesia into Balikpapan.

"In 2012, we strengthened our agility to react quickly to market volatility and exploit cross-divisional potential. We are seeing the results of this approach here in Southeast Asia, and expect to continue this momentum in key growth markets in the region," added Hayes.

"We are upbeat about the potential that Southeast Asia holds as a region, especially as members of ASEAN gear themselves towards the ASEAN Economic Community by 2015," said Hayes. "The expanding economy and rising middle-class present a strong case for Bosch to focus its efforts to further develop the market, while cost of labor and infrastructure build-up makes the region globally competitive for manufacturing its products and components."

Currently, Bosch has five manufacturing plants in Thailand, Malaysia and Vietnam, delivering a multitude of product categories such as power tools; automotive components and multimedia; and industrial technology that serves both domestic and international demand.

Strong development across business divisions to meet diverse demand
In fiscal 2012, sales revenue in Southeast Asia increased across the various business divisions of Bosch.
The Automotive Aftermarket, Power Tools and Security Systems divisions all posted double-digit growth in the region. Packaging Technology increased its regional sales by around 25 percent, and continues to be on track for growth, especially in the confectionary and pharmaceutical industries.

The Thermotechnology division posted the strongest growth of around 70 percent in Southeast Asia. Apart from an increased presence in the region, this growth was also due to key projects secured in the Food and Beverage industry in Vietnam and Indonesia, and across various industries in Singapore.

The Drive & Control division posted similar high sales growth of more than 60 percent across Southeast Asia, and almost doubled its revenue in Singapore due to projects in the marine and offshore industry.

In 2012, the company's subsidiary Bosch Software Innovations received a special recognition for its software solutions: it was positioned as 'Visionary' in the Gartner Magic Quadrant for Intelligent Business Process Management Suites. Bosch Software Innovations secured several key projects in the banking and financial services industries across Asia Pacific, operating out of the Singapore regional head office. As the only R&D center outside of Germany for the business division, Singapore is well-positioned for Bosch Software Innovations to develop and implement leading-edge technologies, especially in the Internet of Things and Services (IoTS). Approximately 50 percent of the staff in this division is involved in R&D functions for the core technology that enables IoTS.

Bosch's Corporate Research and Advance Engineering Center is also housed within the headquarters in Singapore. The center is involved in cutting-edge technologies in fields such as off-grid decentralized electrification, power electronics using a model-based design, and gas sensors for air quality and medical diagnosis.

Course of business in Asia Pacific
In Asia Pacific, Bosch increased its sales by 5.6 percent to $15.8 billion (SGD 20.2 billion). Sales in the Chinese and Indian economies developed less dynamically in 2012 than in previous years. To reach its long-term target of generating 30 percent share of its sales in Asia Pacific, the company invested around $980,000 (SGD 1.25 million) in the region last year, on par with the previous year.

Bosch Group business developments 2012-2013
In fiscal 2012, sales of the Bosch Group grew 1.9 percent to $66.1 billion (SGD 84.3 billion). Pre-tax profit came to $3.53 billion (SGD 4.5 billion).

Developments in the business sectors differed. In 2012, Automotive Technology, the largest business sector, increased its sales by 2.1 percent to $39.1 billion (SGD 49.9 billion). Sales of the Industrial Technology business sector stagnated at $10.04 billion (SGD 12.8 billion). The Consumer Goods and Building Technology business sector generated sales of $16.86 billion (SGD 21.5 billion), a 2.5 percent increase.

Headcount, adjusted to match the company's business development over the course of the past year, rose only slightly by 3,400 to 305,900. In total, Bosch invested $10.04 billion (SGD 12.8 billion) in the company's future in 2012: $6.04 billion (SGD 7.7 billion) for research and development and $4 billion (SGD 5.1 billion) in capital expenditure. For 2013, Bosch expects global sales growth of two to four percent. The measures to improve results that were started in 2012 -- such as limits on fixed costs, capital expenditure and company acquisitions -- are to be continued.

The supplier of technology and services will continue to rigorously pursue the main lines of its strategy -- with systems for environmental protection, energy efficiency and safety. Bosch believes that there is huge energy efficiency potential, as well as sales potential, in modernizing the power supply, energy management and insulation of buildings. On 1 January 2013, Bosch brought together the areas of its business that deal with this to form a fourth business sector, Energy and Building Technology. This new business sector generated sales of $6.27 billion (SGD 8 billion) in 2012.The company also expects sales growth to come from innovative products, web-based business models, and the further expansion of its international presence.

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