Annual Report 2006 - Munters

Facts – HumiCool Division“ Our energy-efficient and environmentally friendlysolutions, primarily within evaporative cooling and mistelimination, gained additional ground during the year, withfavorable trends in both sales and earnings. We areactively seeking out new acquisitions, such as SIAL, thatwill broaden our existing product portfolio and contributeto even more solutions-oriented offerings.”Per Segerström, Division PresidentDevelopments during 2006Strong sales- and earnings trends, driven bycompleted efficiency improvements andincreased global demand for “clean” coalpower.Acquisitions in the areas of mobile heaters andevaporative cooling products will complementofferings and result in new distribution channels.Continued cultivation and focusing of thebusiness through divestment of water treatmentoperations.Strong growth in AgHort.In 2006, HumiCool accounted for 26 percent (26) of Munters’ totalsales. During 2006, the division’s sales increased by 13 percent,compared with the preceding year (15 percent after currencyadjustment). Operating earnings amounted to SEK 213 M (135),and the division’s operating margin was 14.1 percent (10.1).Order intake, sales and earnings developed very favorably duringthe year. Development was particularly strong in mist elimination,where a signifi cant increase in demand for “clean” coal power isdriving growth and profi tability. Growth was also strong in the largestbusiness area, AgHort, where a robust US market compensated fora slightly lower investment pace in Europe.Previous effi ciency-enhancement measures in the form ofproduction structure reviews and ongoing efforts to increase globalcoordination of purchasing and manufacturing, also contributed tothe margin improvement. The Water business unit was sold duringthe fi rst quarter as part of a greater focus on core operations.During the fourth quarter, the Italian fi rm SIAL was acquired, whichis the European market leader in mobile heaters. This expands thedivision’s product offerings and market potential.Key figures 20062006 2005 Growth, %Adjustedgrowth, % 1Order intake, SEK M 1,585 1,460 9 14SEK M2,5002,000SEK M250200Net sales, SEK M 1,514 1,342 13 151,500150Operating earnings, SEK M 213 135 57 59Operating margin, % 14.1 10.1Return on operatingcapital, % 51.1 29.2Capital turnover rate 3.6 2.9No. of employees, 31 Dec. 789 668 181,000500001 02 03 04 05 06Order intake Net salesOperating earnings (right-hand scale)1005001Preceding year restated at 2006 exchange rates and adjusted for acquisitionsand sales of operations.Net sales pergeographical regionShare of consolidatednet salesMarket segments51% Europe39% Americas10% Asia26%45% AgHort32% Mist Elimination17% HVAC4% GTEC2% OtherM U N T E R S A N N U A L R E P O R T 2 0 0 6 29