Media center

In 2009, the privately held Swiss DKSH Group, leader in the sector of Market Expansion Services with a focus on Asia, demonstrated the crisis resistance of its business model by reporting gratifying results. Despite the difficult economic environment, the DKSH Group increased its Net Sales by 4.8 percent to CHF 8.6 billion. Expressed in local currency, DKSH actually lifted Net Sales by 10.9 percent. Net Turnover, i.e. Net Sales achieved for own account, rose in Swiss francs by 1.6 percent to CHF 6.5 billion. Operating profit (EBIT) stood at CHF 128 million, with all Business Units making solid contributions. Published for the first time, Net Income decreased slightly by 3.4 percent to CHF 85 million. Since 2009, the company is free of net debt. Its robust balance sheet allowed DKSH, in a challenging environment, to grow both organically and through acquisitions: in the course of 2009, the Group acquired five companies, among them the Scandinavian specialty chemicals distributor Dasico and Voltas, the Indian specialty chemicals distribution arm of the Tata Group with subsidiaries in all major Indian industrial centers. 2010 is no less dynamic, with DKSH getting off to a fulminant start. Having grown by 25 percent by the end of the first quarter, EBIT is significantly higher than the previous year’s figure. The rhythm of acquisitions has not slowed either: since March 2010, three companies have joined DKSH, including the former Swiss trading house Cosa Liebermann. With these three acquisitions, DKSH is acquiring some further 700 specialists. The distribution network and market coverage have been strengthened by more than 80 additional subsidiaries.

Zurich, May 4, 2010 – In 2009, DKSH successfully defied the trend of global trade which, with a fall-off of 12 percent, suffered the greatest downturn since World War II. The Swiss Group, the leading provider in the sector of Market Expansion Services, continued to grow in all of Asia’s markets. Looking at the Asia business alone, it would have been another record year in terms of profit.

The two biggest Business Units Consumer Goods and Healthcare produced excellent results and continued to increase their respective market shares – the former despite the slump in demand for luxury goods. A decline in Net Sales and profits was reported in European activities, where the Business Unit Performance Materials supplies customers in the automotive, chemicals, and food industries with highly specialized raw materials. Business Unit Technology felt the impact of declining demand in the capital investment goods sector brought about by the recession.

Growing appeal of the DKSH brand

„We have kept our promise: to exploit opportunities that present themselves to market leaders like DKSH in times of economic crisis. On the foundation of our solid financing and clearly defined growth strategy, we have grown organically and also been able to take over several companies“, explains Joerg Wolle, President & CEO of DKSH. Among the DKSH success factors is the currently best possible geographic footprint, i.e. minimal activities in the Anglo-Saxon area that has been hardest hit by the crisis. „Our specialization on Asia remains the strongest growth driver for DKSH. Moreover, Asia has proved far more stable as a selling market than as a sourcing market of products for which demand has declined strongly for the time being. Of increasing significance to us is inner-Asia business, i.e. the marketing and distribution of Asian products within other Asian markets“, comments Joerg Wolle.

Despite the difficult market conditions of the past year, the DKSH business model proved both stable and crisis resistant. On the one hand, DKSH is highly specialized, but on the other, broadly diversified in terms of industries, regions, flows of goods, and value chains. Substantial investments in the expansion and improvement of its infrastructure mark the company out as the market leader. In 2009, DKSH opened new distribution centers in Myanmar, Thailand, and Australia, thereby creating capacities for further growth. Joerg Wolle: „We also see considerable potential in complementary services such as market entry consulting, market analyses, product registrations, repairs or applications training, which we offer as an extension of our traditional core services of marketing, sales, and distribution.“

In this context, DKSH entered into a joint venture in 2009 with the South African Smollan Group, one of the world’s leading field marketing organizations. Over and above this, the DKSH Fantree Academy in Singapore was launched, the in-house center for executive training and development.

Last year, the roll-out of the new corporate design was successfully completed and the remaining country operations that still carried legacy names were renamed to DKSH. Now, all countries are operating under the DKSH brand, whereby worldwide synergies are being exploited and a global platform for increasing the value of the brand has been created.

Broadening the shareholder base, greater transparency

DKSH has evolved from being a traditional trading house into becoming the leading provider in the sector of Market Expansion Services. From a family firm, a privately owned enterprise with high-caliber shareholders has emerged. At the beginning of 2010, Pierre Mirabaud, the former Chairman of the Swiss Bankers Association, became an investor, thereby broadening the shareholder base. For the first time this year, DKSH published figures on its net income and equity.

Dynamic start to 2010

DKSH enjoyed a highly dynamic start to the new year. Results at the end of the first quarter are substantially higher than the 2009 level. Compared to the previous year’s period, Net Sales rose by 8 percent and EBIT by 25 percent. Three acquisitions highlight the ongoing impetus of previous years: in March 2010, the former Swiss trading house, Hagemeyer-Cosa Liebermann joined the Group. Their luxury goods and lifestyle business enhances the leadership position of DKSH as an independent services provider for the marketing, sales, and distribution of premium luxury items in Asia. The second acquisition, Chiao Tai Logistics, the leading logistics company in Taiwan specializing in consumer goods, extends our operations in Taiwan and allows DKSH to offer customers regional market expansion solutions in the Hong Kong, South China, Taiwan triangle. Finally, the Biolife company, the leading vitamin and health supplements provider in Malaysia, strengthens the own-brand activities in the Business Unit Healthcare. In total, those acquisitions increase the number of DKSH employees by some 700, while extending our distribution network and market coverage by more than 80 subsidiaries.

„Through our anti-cyclical approach to investments and a clearly defined growth strategy, we are consistently extending our position as the leading services provider for expansion in Asia’s markets. We will continue our strong growth in the ongoing business year“, says Joerg Wolle, President & CEO of DKSH, underlining the Group’s ambitions. DKSH still has considerable growth potential in its existing markets and Business Units. „Remaining true to the motto of „Cobbler stick to your last“, we focus on what we do and know best: the existing markets of Asia and Europe, i.e. our four Business Units dedicated to Consumer Goods, Healthcare, Technology, and Performance Materials. We will continue to expand in these sectors, above all through organic growth, plus selected bolt-on acquisitions in strategic growth sectors. At the same time, we are consistently enhancing the efficiency and performance of our processes", concludes Joerg Wolle.

Profile DKSH Group

DKSH is the leading Market Expansion Services Group with a focus on Asia. As the term "Market Expansion Services" suggests, DKSH helps other companies and brands to grow their business in new or existing markets.

With 560 business locations in 35 countries – 20 of them in Europe and the Americas – and 22,000 specialized staff it is one of the top 20 Swiss companies ranked by sales and employees. In 2009, DKSH generated annual gross revenues of CHF 8,600 million.

The company offers any combination of sourcing, marketing, sales, distribution, and after-sales services. It provides business partners with expertise as well as on-the-ground logistics based on a comprehensive network of unique size and depth. Business activities are organized into four specialized Business Units that mirror DKSH fields of expertise: Consumer Goods, Healthcare, Performance Materials, and Technology.

Although DKSH is a Swiss company with headquarters in Zurich, it is deeply rooted in communities all across Asia Pacific. This is because the company looks back on a more than 140-year-long tradition of doing business in and with the region.