China and India will remain key growth markets
Premium Textile Components provides technology components and service
facilities both for spinning mills and for machinery manufacturers.
The business group is represented on the market through four brands:
Bräcker, Graf, Novibra and Suessen. In 2011 it employed a workforce of
1075 and accounted for 199.1 million CHF or 19 per cent of Rieter’s
total sales.
Order intake by the Premium Textile Components Business Group declined
by 22 per cent to 183.3 million CHF in the year under review (235.2
million CHF in 2010). Generally speaking, the components business is
less subject to market cycles than the machinery business. It
therefore contributes to a more stable business trend for Rieter as a
whole. Premium Textile Components posted a 4 per cent increase in
sales to 199.1 million CHF in the year under review.
The Premium Textile Components Business Group experienced two
different half-year periods in 2011. Following the upswing in the
previous year, order intake at Premium Textile Components continued to
grow in the first three months of 2011. As of the second quarter,
disruption on the raw materials markets and government intervention in
major sales markets inhibited demand for technology components used in
staple fiber machinery. Towards year end there was a decline in the
market worldwide, but it remained at a significantly higher level than
during the downturn in 2008-09.
Premium Textile Components was successful throughout the year under
review with all four of its brands (Bräcker, Graf, Novibra and
Suessen).
In India and China, demand was inhibited by government intervention,
i.e., restrictions on the availability of credit, but these countries
remained Premium Textile Components’ largest markets alongside Turkey.
In both countries the business group serves customers who supply the
growing domestic market.
Rising labor costs in China and India are resulting in some transfers
of textile industry activities to other Asian countries, such as
Indonesia, Vietnam, Pakistan and Bangladesh. Premium Textile
Components is also well placed in these markets.
The Turkish market continued its positive development in 2011. Demand
in Europe, the US and South America declined slightly compared with
the previous year.
Through its Premium Textile Components Business Group, Rieter is one
of the world’s largest suppliers of components for short-staple
spinning mills. Premium Textile Components supplies technology
components both to spinning mills and to various machinery
manufacturers, including Rieter.
All four of the business group’s brands launched important new
products during the year. At ITMA in Barcelona, Premium exhibited a
wide range of new components for all three established spinning
processes – ring, rotor and compact spinning. They attracted
considerable interest from customers in all segments served by Rieter.
New products were developed both for customers in the premium quality
segment and also to meet the needs of the domestic markets in China
and India. Suessen branded components for the Indian market were an
especially successful example.
All four units of the business group aim through their innovations to
develop new yarn properties, achieve improved utilization of raw
material and provide cost-efficient retrofits for customers’ spinning
installations. With a strong market presence and a well-filled product
pipeline, Premium Textile Components seeks to continue to extend its
lead worldwide in the years to come.
Capacity expansion
Premium Textile Components aims to increase the proportion of direct
business with spinning mills further, since this is less subject to
market fluctuations than the business with textile machinery
manufacturers.
Demand for high quality yarns is also growing in the large new
domestic markets in China and India, and spinning mills need to equip
their installations accordingly. This is a major driver of Premium
Textile Components’ business. In order to be able to supply customers
faster and to prepare for the planned growth in market share and the
implementation of future projects, Premium invested worldwide in the
expansion of manufacturing and logistics capacity in the year under
review.
The crucial competitive advantage of the Premium Textile Components
Business Group is its expertise in producing technology components
with the highest precision and in very large volumes. In some cases
Premium Textile Components’ companies use machinery developed in-house
to manufacture components; the relevant manufacturing technologies are
proprietary. The plants have comprehensive manufacturing know-how and
highly qualified personnel with many years of experience and loyalty
to the company. All crucial production processes are performed
in-house. This ensures top quality, also in large volumes, as well as
quality consistency, process control and optimal protection of
valuable knowhow.
Premium Textile Components develops products for China and India which
are tailored to local market needs. These are also manufactured for
the most part in highly specialized production facilities in Europe.