The current global economic uncertainties and transformation processes in key industries are also making themselves felt at automation specialist Balluff in Neuhausen: Total sales in the 2019 fiscal year fell by 3.9 percent to 469 million euros.

2019 was not an easy fiscal year for the sensor and automation specialist Balluff: Although the company ended the year better than expected with total sales of 469 million euros, the development remained behind targets with a 3.9 percent drop in sales. "We had set ourselves the target of almost double-digit growth in 2019," explains Managing Director Katrin Stegmaier-Hermle. However, the economic momentum cooled noticeably in the second half of the year. "The uncertainty in the markets resulting from the further intensification of international trade conflicts as well as a far-reaching structural change in individual industries had a significant impact on economic development," says Stegmaier-Hermle. This has particularly affected export-oriented industries such as the automotive sector or mechanical and plant engineering, the company's two most important customer segments. "Therefore, it was already clear during the year that we would not be able to achieve our goals under such circumstances.

German-speaking markets remain problematic areas

The structural changes brought about by the digital transformation and megatrends such as autonomous driving or e-mobility pose major challenges for manufacturers and suppliers in the automotive sector. "Problem children are and will remain our home markets - Germany, Austria and Switzerland. But sales development in other markets such as North and South America and Asia also fell short of our expectations," explains Stegmaier-Hermle. "It is therefore all the more gratifying that our diversification strategy is bearing fruit. The Packaging, Food & Beverage (PFB) division grew by around nine percent in the past business year. The Balluff management attributes this positive development to, among other things, increased environmental awareness among consumers, which increases the pressure on manufacturers to innovate and thus leads to investments in modern production facilities.

However, this positive development could not offset the losses of four percent in the Machine & Plant Engineering division and six percent in the Mobility division.

Sales losses due to corona crisis

The first quarter of the current fiscal year ended with a decline in sales of more than seven percent. The outbreak of the corona pandemic led to a slump in incoming orders - first in China and from March onwards worldwide. The east-west course of the corona pandemic is also reflected in the respective sales development of the regions. "For us it was crucial to maintain our ability to supply and act for our customers in this exceptional situation," says Managing Director Frank Nonnenmann, who replaced Michael Unger as Managing Director on February 1, 2020. "We countered the sharp drop in orders by reducing the production volume accordingly. In addition, costs were cut across all 38 locations and short-time working was introduced at the Neuhausen location on 1 April for part of the workforce - the areas of product development and IIoT are excluded from the scheme until further notice. Despite these challenges, we were able to maintain our global production and logistics network through comprehensive protection and hygiene measures and a strong team in the supply chain, thus ensuring that we were able to deliver consistently".

According to Katrin Stegmaier-Hermle, the company is expecting a very slow economic normalisation, which will continue to be burdened by the serious effects of the corona crisis. In order to cope with the current situation, Balluff is concentrating on the consistent further development of its product and solution portfolio, especially for growth sectors such as the pharmaceutical and packaging industry or the fields of e-mobility and renewable energies.