Protection of the health of employees, securing supply chains for customers, and keeping the innovation rate high were the top priorities. Despite adverse conditions, Bühler fulfilled all customer contracts and delivery agreements without interruptions. And the company launched major innovations for key markets. The Group gained additional financial strength, with equity ratio reaching 44.2% (+1.4 percentage points) and net liquidity soaring to CHF 749 million (+66.8%). Turnover was CHF 2.7 billion (-17.0%), with order intake amounting to CHF 2.6 billion (-16.7%).
“With high agility we adapted quickly to the new situation to ensure continuity on all levels,” says CEO Stefan Scheiber. “In light of our global set-up and innovation power, we are looking into the future with bounded optimism.”
Bühler assured the health of its employees and its daily operations throughout the year. Supply chains proved remarkably solid, as Bühler was able to absorb the pandemic’s waves thanks to its global network of 33 factories, 100 service stations, and digital tools such as remote customer trials or commissioning, to bring much needed food capacities online worldwide. “We have seen a sharp rise in customer demand for digital solutions, but also for sustainable solutions, such as CO2-reduced emissions, nutritious and healthy food, high-end deposition technologies, and clean mobility,” says Stefan Scheiber.
Business Report 2020: Advanced Materials
The markets of Advanced Materials (AM) showed a diverse development in 2020. Although a further slowdown was anticipated, Die Casting and Grinding & Dispersing faced especially difficult market conditions. On the other hand, Leybold Optics delivered one of its record years. Turnover was CHF 443 million, which compared to 2019 is a reduction of 31.7%. Order intake decreased by 7.2% to CHF 453 million. With the continued execution of its innovation roadmap, AM prepared for future growth. The business’s technology leadership was proven by the German Future Prize, which was awarded to customers using Bühler equipment.
Increased financial strength
“Protecting our liquidity had the highest priority over the course of last year,” says CFO Mark Macus. “Our target was to remain a very solid and strong partner for all our stakeholders, and we achieved this even in a challenging year like 2020.” Driven by diligent finance management, operating cash flow jumped 211% from CHF 151 million to CHF 470 million. Strict cost management allowed Bühler to offset a significant part of the adverse volume impact, resulting in EBIT of CHF 146 million (previous year: CHF 248 million), and an EBIT margin of 5.4% (7.6%).
Turnover was CHF 2.7 billion, down 17.0% from CHF 3.3 billion. The 2020 figures are impacted by the development of currency exchange rates, specifically of the Chinese yuan, euro, and US dollar against the Swiss franc. Adjusted for the impact of the foreign exchange rates, the reduction of the top line versus last year was 13%.
Success in China mitigated low volumes in other regions
Along with the divergent course of Bühler’s businesses, there was also a shift in regional development towards Asia. While all markets reported lower volumes, Bühler Asia managed to be stable driven by the strong growth of Bühler’s business in China. Order intake in China rose sharply by 15% for the full year. Regarding turnover, Asia now makes up 35% (previous year: 31%), Europe 30% (30%), North America 16% (16%), Middle East & Africa 11% (14%), South America 5% (6%), and South Asia 3% (3%). Yet again, the global network of Bühler played a key role for Bühler in 2020, so that all customers on all continents were served without interruption.
Continuation of innovation roadmap
Despite the challenging environment, Bühler continued to execute its innovation roadmap, launching 86 new products and solutions. This is a tribute to its 160 years of existence, marked in 2020, and it is a reconfirmation of the company’s purpose of innovations for a better world. The expenses for research and development were about at last year’s level at CHF 139 million (previous year: CHF 149 million), leading to an increase relative to Group turnover of 5.2% (previous year: 4.6%). Bühler has opened new application centers for food in Minneapolis, US, for malting and brewing in Beilngries, Germany, and a new training and education center for cocoa processing in Abidjan, Cote-d’Ivoire. With Givaudan, the global leader in flavors and fragrances, Bühler built an Innovation Center dedicated to plant-based foods in Singapore. The new facility is planned to open in March 2021. With Canadian Premier Tech, Bühler formed a joint venture in China for new packaging solutions which started very successfully in 2020. Furthermore, Bühler drove latest innovations for digital platforms and solutions successfully into industrial applications globally with impressive success.
All innovation efforts of Bühler are aligned to the company’s commitment to lower energy use, water consumption, and waste in the value chains of its food, feed, and mobility customers by 50% until 2025. These sustainability goals have been anchored in the new Destination25 strategy, which was developed and agreed in 2020 and is valid until 2025. Furthermore, Bühler intensified its initiatives to provide training and education programs for customers and partners, as well as for employees worldwide. The global apprentice program was further developed, and the successes of the top apprentice talents at the 2020 SwissSkills competitions – with eight medals in four key disciplines – were lighthouses for the nearly 600 apprentices the company employs, coaches, and develops globally.
Outlook: bounded optimism
Bühler took all learnings from 2020 to increase business excellence and develop the “new normal”, for example, by switching to digital customer communication formats, such as the Bühler Virtual World. Based on a strong purpose as a family company and dedicated employees across the globe, with its innovation power, broad portfolio, and its global set-up, Bühler is looking into the future with optimism. “For 2021, we expect our business volume and profitability to stay stable, as the coronavirus crisis will have a longer lasting effect in our businesses. At the same time, we are now laying ground to return to profitable growth in future, by addressing new markets and adapting to new market conditions and opportunities with agility and determination,” says Stefan Scheiber.