The Bosch Group has announced that its sales for 2005 rose by 6.4 per cent, to touch 41.5 billion euros, and expects to maintain the same momentum for the current year. The company also announced that, to further strengthen the company's international presence and innovative strength, upfront investments in research and development as well as in capital expenditure will remain on the same high level as before.
Speaking at the annual press conference recently at Stuttgart, Germany, Franz Fehrenbach, Chairman of the Bosch Board of Management, said, “In terms of both sales and result, we have continued our positive development. For 2006, we expect sales to increase by roughly five percent.”
In 2005, research and development expenditure came to 3.1 billion euros (2004: 2.7 billion euros), whereas capital expenditure came to 2.9 billion euros (2004: 2.4 billion euros). The focus of international expansion is the Asia Pacific growth region. Between 2005 and 2008, some 1.6 billion euros are to be invested here, above all in China and India.
The consolidated financial statements of the Group that were presented for the first time on the basis of International Financial Reporting Standards (IFRS) showed that the pre-tax result increased from 2.7 to 3.2 billion euros. This is equivalent to 7.7 percent of sales. This rise is mainly due to the significantly improved financial result. The return on sales from operations, without financial income, came to six percent.
"In order to continue to finance our innovative strength internally, and to exploit growth potential the world over, we still strive to achieve a pre-tax return on sales of between seven and eight percent," Fehrenbach said. Bosch sees risks to its result in the constantly rising prices for raw materials, in ever fiercer competition, and in increasing pressure on prices. Given this situation, Fehrenbach said, special efforts would be required to maintain the return on sales from operations achieved in 2005.
In 2005, Bosch grew strongly especially in Asia Pacific, where the increase in sales was 16 per cent. In the Americas, Bosch grew by 11 per cent, while the figure for Europe was 3.5 per cent. This allowed the share of sales accounted for by business outside Europe to rise from 32 to 34 per cent. Sales showed an increase in all the company's business sectors: up by 5.4 per cent to 26.3 billion euros in Automotive Technology, by 6.1 percent to some 10 billion euros in Consumer Goods and Building Technology, and by 12.5 per cent to 5.2 billion euros in Industrial Technology.
Bosch also maintained a steady increase in headcount, by adding 13,000 Bosch associates in 2005 to take the total to roughly 251,000. By the end of 2006, the Bosch Group expects to have close to 260,000 associates worldwide, with most new associates to be hired in the emerging markets.