Dear business partners,
Another year of SMS groupʼs consequent focus on future technological and market-specific requirements lies behind us. After several years of consolidation, order intake and earnings have increasingly stabilized and we were able to achieve and, in some cases, exceed the set goals for the financial year.
Overall, 2018 was a good year for the processed materials markets. It was only around the transition into 2019 that the economic outlook deteriorated. Protectionist tendencies in international trade with high tariffs in some cases, structural changes in the automotive industry, “BREXIT” and political tensions in specific regions are the main causes of increasing uncertainty in global supply chains. Whether these developments will lead to a sustained investment restraint can be better evaluated throughout 2019.
For our SMS group, it was essential to fully implement the comprehensive package of measures for all corporate divisions in Germany and abroad. The core of the program was to strengthen the competitiveness of our German locations. Based on an open discussion with the employees, we implemented a binding future contract in an impressive manner. The trusting cooperation deeply rooted in our corporate culture is a crucial foundation for this success.
In parallel to increasing efficiency and optimizing business processes in the company, significant progress was made in implementing the strategic future and growth topics. Our new in-house start-up SMS digital has proven a particularly effective addition to our group. New projects for the “learning factory” of our customers and our internal digital transformation form the basis for market leadership in 4.0 solutions in the materials industry.
“We were able to achieve and, in some cases, exceed the set goals for the financial year.”
Edwin Eichler, Chairman of the Supervisory Board, SMS GmbH
Another key milestone for growth and innovation was Paul Wurth’s investment in Sunfire. With the introduction of high-temperature electrolysis, SMS group will contribute significantly with direct reduction technology to reduce the carbon footprint of the steel industry in the coming years. This technology leap also opens new, fast-growing markets for nonferrous metallurgy and zero-emission processes for environmental and recycling technologies. This opens a particularly promising area of strategic growth: a sustainable circular economy of raw and processed materials.
In order to master all the challenges of the core business, the innovative digital and service-oriented products as well as the technological growth areas, the structural and operational organization has been consistently developed. The focus on innovation of our core products in mechanical and plant technology will greatly enhance performance and competitiveness. The program of measures to improve project management, from engineering to site management and commissioning at the customer, has already had a positive effect in the past year. Together with the comprehensive digitalization of all processes for product creation and project implementation, a dynamic platform for the future increase of our company’s value is established.
At the same time, the close integration of “product,” “project,” and “process” was consistently portrayed in the new distribution of tasks of the management. The measures introduced in recent years are now taking effect. They define the strategic orientation of SMS group in the next decade. The further development of the product and service spectrum for the global markets aims to reduce cyclicality and to strengthen profitability in order to create the basis for extensive investments in this future. Employees and executives stand together for this challenge on the firm foundation of our corporate culture of partnership. All have impressively demonstrated flexibility and the ability to adapt to changing market situations with team-oriented solutions.
On behalf of the Supervisory Board, I especially thank all our employees for the work they have accomplished during the financial year. To our global business partners, I say thanks for their cooperation and loyalty to our SMS group.
Raw materials and materials are the basis for technology and business – together we create the most innovative solutions and we remain ”The Leading Partner in the World of Metals.”
Chairman of the Supervisory Board, SMS GmbH