www.rieter.com

Rieter General Assembly Approves All Board Proposals

Thu, 18 Apr 2013 20:00:00 +0200

The 122st Annual General Meeting of Rieter Holding Ltd was attended by 576 shareholders representing 46.5 % of share capital. They approved all Board proposals, the Annual Report with the annual accounts and consolidated financial statements for 2012, and formal discharge of the Board of Directors and Group Executive Committee members for the business year 2012. Consultative approval of the Compensation Report was confirmed by a 79.68 % majority of those present. A dividend of 2.50 CHF per registered share was approved for payment from capital reserves without deduction of withholding tax. Shareholders voted Dr. Dieter Spälti to the Board of Directors for another 3-year term of office. In his review of the current situation, Executive Chairman Erwin Stoller confirmed prospects for the business year 2013 as announced at the Rieter Results Press Conference on March 21.

Upcoming events in 2013

Semi-Annual Report 2013: July 25, 2013

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Pressrelease Annual General Meeting 2013 (PDF/EN/17.2 KB)
Pressrelease Annual General Meeting 2013 (PDF/DE/81 KB)

About Rieter

Rieter Holding Ltd.
Investor Relations
Joris Gröflin
Chief Financial Officer
T +41 52 208 70 15
F +41 52 208 70 60
investor@rieter.com

Rieter Management Ltd.
Media Relations
Cornelia Schreier
Head Corporate Communications
T +41 52 208 70 32
F +41 52 208 70 60
media@rieter.com

Norbert Klapper appointed Rieter Group CEO

Thu, 04 Apr 2013 19:00:00 +0200

Since his additional nomination as Executive Chairman in 2009, Board Chairman Erwin Stoller focused particularly after the Rieter split on firmly establishing the Group’s strategic alignment. These tasks will largely be complete by the end of 2013, so that his dual mandate will no longer be necessary. Norbert Klapper, German citizen born 1963, graduated at Darmstadt Technical University and was Assistant Professor at Passau University and Munich Technical University, where he received his Ph.D. in economics. He then joined Arthur D. Little business consultants, where he became Managing Partner for Production und Logistics. In 2000 he joined the Executive Board of Dürr AG, Stuttgart, with responsibility for the two internationally active divisions Services and Final Assembly Systems. In 2005, Norbert Klapper transferred to Voith in Heidenheim, Germany. Since 2011, he is Executive Vice President of Voith Turbo, being in charge of the global railway business which has a size of 480 million EUR on an annual basis. Norbert Klapper has accumulated widely based international experience in the machinery and plant engineering industry, also in the markets important to Rieter.

Please find the Media Release and picture of Norbert Klapper, Ph.D. at www.rieter.com/en/rieter/media/press-releases/. You can also register at www.rieter.com to receive our media releases regularly by e-mail.

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Pressrelease (PDF/EN/119 KB)
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Portrait Norbert Klapper (JPG/CMYK/1.9 MB) (right click, save as...) For further information please contact:

Rieter Management AG
Media Relations
Cornelia Schreier
Head Corporate Communications
T +41 52 208 70 32
F +41 52 208 70 60
media@rieter.com

About Rieter

Rieter, with registered offices in Winterthur, Switzerland, is a global market leader in spinning machinery and components, with the broadest offering worldwide. The company develops and manufactures machinery, components and systems for manufacturing yarns from natural and man-made fibers and combinations of the same. Rieter is the world’s only supplier of products and know-how covering not only pre-spinning processes but also all four final spinning processes established on the market. The company has 18 production plants in 10 countries and employs some 4700 people worldwide, of whom about 27% in Switzerland. Rieter is listed on the SIX Swiss Exchange (ticker symbol RIEN).
www.rieter.com

Business year 2012: Rieter with stronger position in weaker market environment

Thu, 21 Mar 2013 07:00:00 +0100

The Rieter Group held its own in 2012 against difficult market conditions worldwide. Order intake for the year as a whole declined by 12% to 839.7 million CHF, although Rieter received more orders in the second half-year than in the first. As expected, sales totaling 888.5 million CHF were 16% lower than in 2011. Mainly due to lower sales and also the 2012/2013 investment program announced by Rieter in spring 2012, the operating result (EBIT) declined to 33.6 million CHF or 3.8% of sales (2011: 10.6% at 112.6 million CHF). Net profit was 26.5 million CHF or 3.0% of sales (2011: 11.2% at 119.0 million CHF). For the 2012 financial year the Board of Directors proposes a dividend of 2.50 CHF to be paid out of the reserves from capital contributions. Despite adverse economic conditions, Rieter strengthened its market position during the year under review and closed with a sound balance sheet. Rieter has reached its half-time goals in the investment program for further growth, and is well on course with the respective projects. In 2013, Rieter will focus all the more on greater profitability. Pressrelease Business Year 2012 (PDF/EN/75 KB)
Pressrelease Business Year 2012 (PDF/DE/133 KB) The business year 2012 was beset by uncertainties in all major economic regions worldwide. Textile machinery and component suppliers were faced with additional industry- and country-specific challenges in their main markets of China and India. Spinning mills in India were still affected during the first half of the year with the consequences of raw materials price distortions, but during the second half-year, demand started to improve particularly in northern India. In China the spinning mills suffered as a result of government regulated raw material prices. Overall, Rieter’s spinning mill customers recorded a more stable trend of business in the second half of 2012 and operated profitably. The business environment in Rieter’s yarn customer markets remained volatile, however, and the banks upheld their caution with regard to project financing. It was clearly apparent in 2012 that in this unfavorable environment, Rieter is well positioned with the existing product range and is heading in the right direction with its innovation and expansion strategy focused on Asia. Today the company is considerably better off with market-specific products than during the economic slump of 2008/09. Rieter strengthened its overall market position in 2012. In the major markets of China and India, machinery and components offering higher productivity and quality, with lower energy consumption and with a higher degree of automation, are in greater demand than ever.

Orders received and sales

Order intake by the Rieter Group in the year under review declined by 12% to 839.7 million CHF. This was also due to cancellations of orders totaling about 60 million CHF. The second half-year nevertheless brought 435.6 million CHF order intake, 8% higher than in the first half of the year. The main reason for this positive development was market revival in India and a slightly increased demand in Turkey, in the South East Asian countries, and in North and South America. In China, Rieter attained a good level of order intake despite a more challenging environment. During this period several large orders for machine deliveries in the 2013 financial year were also received. Both business groups recorded lower order intake, but the decline was less pronounced with Spun Yarn Systems (machinery business) than with Premium Textile Components (components supply business). Rieter orders on hand per year-end totaled around 550 million CHF.

Rieter Group sales for 2012 totaled 888.5 million CHF, 16% less than in prior year. The downturn became more pronounced in the second half-year, when sales were 18% lower than in the first semester. This was due to weak order intake at the beginning of 2012, orders postponed by customers until the 2013 financial year, and weaker components supply business. Spun Yarn Systems business group sales declined by 16% to 727.6 million CHF despite substantially higher sales in China compared to the previous year. Premium Textile Components sales declined by 19% to 160.9 million CHF.

Per December 31, 2012 Rieter employed a workforce of 4720, as against 4695 one year earlier. There are mainly two reasons for this slight increase in the Rieter workforce despite declining business volume. On the one hand Rieter is expanding local presence in India and China, and on the other hand there has been an ongoing need for specialist personnel in Switzerland and Germany to provide strategic project support. Furthermore, Rieter also employed temporary personnel amounting per year-end to 985 employees or 17% of the total workforce.

Operating result and net profit

The Rieter operating result for 2012 before interest and taxes (EBIT) totaled 33.6 million CHF or 3.8% of sales (2011: 112.6 million CHF or 10.6% of sales). The difficult market environment and associated decline of business volume did not deter Rieter from continuing with its investment program. EBIT for the year under review included expenditures totaling 25.3 million CHF for investment program 2012/2013 (see below). These expenditures impacted the EBIT margin by less than 2.8 percentage points, well within expectations. EBIT prior to deductions for strategic projects therefore amounted to 58.9 million CHF, or 6.6% of sales. In addition to the decline of business volume, a less favorable product mix also impacted EBIT development. Components supply business contributed less to Rieter’s sales than in prior year, and machinery sales margins declined. This was attributable on the one hand to the lower demand for high-margin products, and on the other hand to the cyclic and currency-related higher pressure on pricing. The operating result was enhanced by gains totaling 6.0 million CHF from the sale of Czech production plants in 2012, as announced in 2011.

Investments in tangible fixed assets and intangible assets totaled 81.6 million CHF, a good 51.6 million CHF of which in strategic projects. Regular investments of 30.0 million CHF in replacements and rationalization thus amounted to 3.4% of sales, in line with the long-term average. Rieter accelerated research and development with 42.7 million CHF or 4.8% of sales (2011: 39.5 million CHF).

Net profit for the year under review amounted to 26.5 million CHF or 3.0% of sales (2011: 11.2% of sales at 119.0 million CHF, of which 47.3 million CHF from reduction of Rieter’s equity interest in Lakshmi Machine Works). This includes gains of 17.6 million CHF from sale of the residual equity interest in Lakshmi Machine Works and Lakshmi Ring Travellers. Earnings per share for 2012 thus amounted to 6.40 CHF. Return on net assets (RONA) was 6.7% (2011: 19.8%).

Dividend

Rieter Holding Ltd. posted a net profit of 12.0 million CHF for the 2012 financial year (28.7 million CHF in 2011). The Board of Directors will propose to the Annual General Meeting on April 18, 2013 that a dividend of 2.50 CHF be paid for the 2012 financial year out of the reserve from capital contributions (2011: 6.00 CHF). This corresponds to a distribution ratio of 39% of earnings per share. Rieter aims for an average distribution ratio of about 30% over the years, taking into consideration various factors such as the trend of business, liquidity needs and market prospects.

Spun Yarn Systems Business Group

Order intake of 695.0 million CHF by the Spun Yarn Systems Business Group in 2012 was 10% lower than a year earlier (2011: 775.0 million CHF). Sales by Spun Yarn Systems were 16% lower at 727.6 million CHF (2011: 861.7 million CHF), declining mainly in the second half-year. This is attributable on the one hand to low order intake in the first half of 2012, and on the other hand to some orders not being delivered until 2013 partly as a consequence of customer postponements.

The operating result (EBIT) of 81.2 million CHF (9.4% of sales) posted by Spun Yarn Systems for 2011 declined in 2012 to 30.5 million CHF (4.2% of sales). The lower profitability than in prior year is attributable to the lower business volumes, a less favorable product mix in machinery business, and lower spare parts sales. The cyclically lower demand for new machinery, resulting in more intense competition among manufacturers, has led to pricing pressure in particular on business invoiced in Swiss francs. This likewise led to a margin decline, which could only be compensated in part by the production costs savings realized. Furthermore, the majority of strategic project costs arising in connection with the 2012/2013 investment program were charged to Business Group Spun Yarn Systems, especially to locations in Switzerland.

Premium Textile Components Business Group

Order intake by the Premium Textile Components Business Group declined by 21% from prior year to 144.7 million CHF in 2012 (2011: 183.3 million CHF). This development is mainly attributable to weaker demand for deliveries to Chinese and Indian textile machinery manufacturers. Sales declined by 19% to 160.9 million CHF (2011: 199.1 million CHF), while segment sales – i.e. including internal deliveries to Spun Yarn Systems – declined less by 12% to 232.3 million CHF (2011: 263.9 million CHF). Premium Textile Components’ EBIT for the year under review amounted to 16.0 million CHF, corresponding to an operating margin of 6.9% of segment sales (2011: 35.1 million CHF or 13.3% of segment sales). Profitability declined mainly because of lower volumes, particularly in third-party business with textile machinery manufacturers and in spinning mill retrofit business.

Balance sheet and finances

Rieter has a sound balance sheet with an unchanged equity ratio of 35% (2011: 35%). In particular the high investment and project costs in connection with the 2012/2013 investment program, and a slight increase in net working capital, resulted in negative free cash flow of 32.3 million CHF. Due to postponements of orders in the second half-year, some machines completed by year-end were not yet delivered. In 2012 dividends totaling 27.7 million CHF were paid out of the reserve from capital contributions. Net liquidity had reduced per 31.12.2012 to 95.6 million CHF.

Rieter‘s financial stability is additionally ensured by a 250 million CHF bond issue until 2015. This assures Rieter of strategic flexibility and long-term financing of the company‘s development.

Progress with the 2012/2013 investment program

Although the substantial investment program announced early in 2012 (see below) placed challenging demands on those involved, all half-time goals for the year were nevertheless reached. The overall program implementation is now going ahead and financially well on course. By year-end 2012 Rieter had taken the following important steps: Expansion in Asia: Rieter made rapid progress with capacity expansion in its two key markets of China and India. In Changzhou, China, Rieter upgraded the existing plant and completed the first construction phase of a large second plant. This was inaugurated in June and is now fully operational. Both plants are at a high level of the operational excellence for which Rieter strives worldwide. In India, Rieter created additional capacity with an existing plant rebuild and a new plant building in Koregaon Bhima. The plant in Wing was optimized and has likewise made good progress in operational excellence. The expansion plan is scheduled for completion per year-end 2013. Innovation: Rieter worked intensively on innovations in 2012 and launched new machines and technology components to improve yarn quality, increase productivity and enhance energy efficiency. Selective and controlled market launch of the J 20 air-jet spinning machine went ahead, and a customer in China commissioned the first complete line of J 20 air-jet spinning machines. Well received by customers were among others the E 80 comber and a wide range of new Bräcker, Graf, Novibra and Suessen brand technology components.

Process improvements: Rieter was also well on course with process improvement investment priorities per year end 2012. Apart from the projects for global standardization and IT support of business processes, Rieter made good progress with organizational realignment to a global working approach, in particular with regard also to manufacturing. By concentrating assembly work at the Winterthur location in Switzerland, and with projects in Germany and the Czech Republic, Rieter pushed forward operational excellence in Europe as well.

Expertise in the textile value chain – a competitive advantage

Ongoing innovations in components and machines are crucial to Rieter‘s long-term success. Together with its recognized expertise in the textile value chain and the ability to manufacture high-precision components in volume, innovations secure Rieter‘s strong competitive position globally. The company is well placed to uphold and extend its technological and innovation lead in the years to come. Rieter has a global customer base and presence, and covers all four final spinning technologies as well as the relevant spinning preparation. Rieter is therefore able to optimize the spinning process as a whole.

Strong brands with international presence

With its long-standing industrial experience, its strong Rieter brands in the machinery business as well as in the components business with the brands Bräcker, Graf, Novibra and Suessen and its extensive expertise in the textile value chain from raw materials to end products, the Rieter company enjoys global recognition. During 2012 Rieter‘s specialists attended not only the three large trade fairs ITM in Istanbul, ITMA Asia in Shanghai and ITME in Mumbai, but also several other important trade fairs and symposia in specific market areas. Rieter’s development result presentations make a major contribution to improving know-how throughout the industry. In great demand are for example Rieter’s seminars for yarn suppliers and designers to deepen their understanding of the four spinning systems and the resultant yarn properties. Rieter thereby meets a widespread customer need for know-how exchange along the entire value chain. This also results in valuable feedback to the Rieter product development.

Rieter’s unique technology leadership in the spinning machinery market is unchallenged. This is clear from the high access rates to the Rikipedia online database for yarn production information, high readership of Rieter articles in the specialized media, Rieter’s close contacts with universities, specialized institutes and leading fiber producers, and from the invitations received to presentations in all parts of the world.

Rieter diligently protects know-how of vital business importance through patents and by other means.

Board of Directors and Annual General Meeting

Shareholders at the Annual General Meeting held on April 18, 2012 elected Dr. Jakob Baer, Michael Pieper, This E. Schneider, Hans-Peter Schwald and Peter Spuhler to the Board of Directors for a further three-year term of office. This E. Schneider continues as Vice-Chairman of the Board and Lead Director.

By approving an amendment to the articles of association, shareholders enabled the creation for two years of new authorized capital to the maximum amount of 2.5 million CHF in the form of up to 500 000 registered shares. This measure will provide Rieter with greater financial flexibility for exploiting strategic opportunities, such as acquisitions, without delay.

At the Annual General Meeting to be held on April 18, 2013, Dr. Dieter Spälti is standing for re-election to the Board of Directors for a further three-year term of office.

Focus on sustainable profitability improvement

The expansion of Rieter locations in China and India will be completed by the end of 2013 as announced. The projects for improving global processes are likewise well advanced. With completion of the 2012/2013 investment program and in order to improve the ability to respond to the market cycles typical in this industry, Rieter aims again to lower the break-even threshold in both business groups.

Rieter expects further market growth above all in Asia, and must therefore adjust capacities accordingly at the long-established locations. The expected consequence is personnel reductions totaling about 5% of the global workforce, both temporary and permanent, over a period of 24 months predominantly in Switzerland. Although this will be achieved in part through natural fluctuation, early retirements, and reduction of temporary personnel engaged specifically for the investment program, the remaining workforce will also be subject to adjustments. Consultations with the respective staff committees will be held at the appropriate time. Rieter is also focusing on margin improvement through production costs savings, optimal capacity management and greater price discipline, in order to reach the announced mid-term goals.

Outlook

Rieter business activities are broadly based worldwide. Heterogeneous market development is expected for 2013. Market development depends amongst other factors also on currency exchange rate developments, consumer sentiment in Europe and North America, fiber consumption growth in Asia, and raw material prices. The slight improvement in market conditions in the second semester of 2012 continued in the first two months of 2013. Full-year sales for this financial year are expected to reach at least a similar level as in 2012. As a result, operating profit (EBIT) is expected around 2012 levels before disposal gains. This includes strategic project costs from the investment program 2012/2013 of about 20-25 million CHF. Operating profitability in the first semester 2013 is expected to be lower due to less attractive inherent margins in the current order backlog. Rieter expects a slightly positive net profit in 2013. Investment activity from the finalization of the investment program 2012/2013 will lead to capital expenditure of around 35-40 million CHF on top of ongoing replacement demand.

Investment program 2012/2013 for further growth

Expansion in Asia: Further build-up of capacity in China and India;
Innovation: Increased focus on air-jet spinning, improvement of yarn quality, productivity and energy efficiency of machinery and components;
Process improvements: Operational excellence, global standardization and IT support of business processes.

Rieter plans investments totaling around 140 million CHF in 2012/2013 for rapid expansion in Asia, product innovations, and the further improvement of global processes. In 2012, 51.6 million CHF were invested, and another 25.3 million CHF impacted the result as strategic project costs (2.8% of sales). These investments were in addition to the regular investments for replacements.

Through this investment program, Rieter is seeking to achieve an EBIT margin of at least 9% over the demand cycles and greater than 12% in peak years. Further information about the year-end results as well as the Annual Report 2012 and photos for the media can be found at www.rieter.com
(http://www.rieter.com/fileadmin/user_upload/picturepark/2013-03-21_Rieter_Media_Release_en_Original__48106.pdf).
At www.rieter.com you can also subscribe to the mailing list for our press releases.

2012 Annual Results Media Conference

Today, March 21, 2013, 10.15 h Location: Maschinenfabrik Rieter, Training Center, Klosterstrasse 32, 8406 Winterthur

2012 Annual Results Financial Analysts’ Conference

Today, March 21, 2013, 14.00 h Location: Maschinenfabrik Rieter, Training Center, Klosterstrasse 32, 8406 Winterthur

Conference Call, dial-in:
+41 (0)58 310 50 00 (Europe)
+44 (0)203 059 58 62 (UK)
+1 (1)866 291 41 66 (USA - Toll-Free)

Important dates 2013

Annual General Meeting 2013: April 18, 2013
Semi-annual report 2013: July 25, 2013

Download

Pressrelease Business Year 2012 (PDF/EN/75 KB)
Pressrelease Business Year 2012 (PDF/DE/133 KB)

About Rieter

Rieter Holding Ltd.
Investor Relations
Joris Gröflin
Chief Financial Officer
T +41 52 208 70 15
F +41 52 208 70 60
investor@rieter.com

Rieter Management Ltd.
Media Relations
Cornelia Schreier
Head Corporate Communications
T +41 52 208 70 32
F +41 52 208 70 60
media@rieter.com

Financial Highlights

CHF million		2012	2011	2012/2011 Change in %
Rieter
Orders received		839.7	958.3	-12
Sales		888.5	1 060.8	-16
Operating result before strategic projects, interest and taxes		58.9	134.5	-56
· in % of sales		6.6	12.7
Operating result before interest and taxes (EBIT)		33.6	112.6	-70
· in % of sales		3.8	10.6
Net profit ¹		26.5	119.0
· in % of sales		3.0	11.2
Investments in tangible fixed assets and intangible assets		81.6	57.3	42
Total assets		1 070.1	1 111.4	-4
Shareholders’ equity before appropriation of profit		376.8	387.7	-3
Number of employees at year-end ²		4 720	4 695	1

Business Group Spun Yarn Systems
Orders received		695.0	775.0	-10
Sales		727.6	861.7	-16
Operating result before interest and taxes (EBIT)		30.5	81.2	-62
· in % of sales		4.2	9.4

Business Group Premium Textile Components
Orders received		144.7	183.3	-21
Sales		160.9	199.1	-19
Total segment sales		232.3	263.9	-12
Operating result before interest and taxes (EBIT)		16.0	35.1	-54
· in % of total segment sales		6.9	13.3

Rieter Holding Ltd.
Share capital		23.4	23.4
Net profit		12.0	28.7	-58
Dividend		11.7³	28
Number of registered shares, paid-in		4 672 363	4 672 363
Average number of registered shares outstanding		4 609 778	4 625 281
Price share (high/low)⁴	CHF	198/123	267/133
Number of registered shareholders on December 31		6 972	7 262	-4
Market capitalization on December 31		736.7	653.2	13

Data per registered share
Earnings per share ¹	CHF	6.40	25.86	-75
Equity (group) ⁵	CHF	80.45	81.93	-2
Dividend (Rieter Holding Ltd.)	CHF	2.50³	6.00

1.   From continuing operations.
2.   Excluding apprentices and temporary employees.
3.   According to proposal of the Board of Directors.
4.   Source: Bloomberg.
5.   Shareholders’ equity attributable to shareholders of Rieter Holding Ltd. per share outstanding at December 31. All statements in this report which do not refer to historical facts are forecasts for the future which offer no guarantee whatsoever with respect to future performance; they embody risks and uncertainties which include – but are not confined to – future global economic conditions, exchange rates, legal provisions, market conditions, activities by competitors and other factors which are outside the company‘s control. This is a translation of the original German text.

2012 financial year: expected decline in volumes

Tue, 05 Feb 2013 07:00:00 +0100

The Rieter Group had to hold its own in a challenging market environment worldwide in the 2012 financial year. Orders received totaled 839.7 million CHF, corresponding to a reduction of 12% for the year as a whole, but order intake was higher in the second half of the year than in the first six months. As expected, sales were lower than in 2011, declining by 16% to 888.5 million CHF. Rieter had a backlog of orders in hand of some 550 million CHF at the end of 2012. Rieter will publish its annual financial statements and annual report on March 21, 2013. Orders Received and Sales 2012 (English/PDF/577 KB)

CHF million	2012	2011	Change	Change in local currencies
Orders received	839.7	958.3	-12%	-13%
Spun Yarn Systems	695.0	775.0	-10%	-11%
Premium Textile Components	144.7	183.3	-21%	-20%
Sales	888.5	1 060.8	-16%	-17%
Spun Yarn Systems	727.6	861.7	-16%	-16%
Premium Textile Components	160.9	199.1	-19%	-18%

Uncertainty was the characteristic feature of all major economic regions of the world in 2012. Suppliers of textile machinery and components faced additional industry- and country-specific challenges in their main markets of China and India. Spinning mills in India continued to struggle with the consequences of the distortions in raw material prices in the first half of the year, but a recovery in demand became apparent in the second half, especially in the north of the country. In China, spinning mills suffered as a result of government-regulated raw material prices. Overall, Rieter’s spinning mill customers recorded a more stable trend of business in the second half of the year and operated profitably. However, the business environment in yarn customers’ markets remained volatile and banks’ attitude to financing projects remained cautious.

In this unfavorable environment it was clearly apparent in 2012 that Rieter is well positioned with its existing product range and that its innovation and expansion strategy with the focus on Asia is aiming in the right direction. The company is considerably better structured with market-specific products today than during the economic slump in 2008/09. Rieter reinforced its overall market position in 2012. Machinery and components offering higher productivity and quality with lower energy consumption, also with a higher degree of automation, are in greater demand than ever in the major markets of China and India.

Orders received

In the year under review the Rieter Group received orders amounting to 839.7 million CHF, equivalent to a decline of 12%. This figure includes cancelations of orders totaling some 60 million CHF. Order intake nevertheless increased by 8% to 435.6 million CHF in the second half of the year compared to the first six months. This positive trend was due mainly to the revival of the market in India and a slight increase in demand in Turkey and in countries in Southeast Asia as well as North and South America. In China, Rieter recorded a good level of order intake despite a more challenging environment. A number of substantial orders for machines not due to be delivered until the 2013 financial year were also received during this period. Order intake was lower at both business groups, but the decline was less pronounced at Spun Yarn Systems (the new machinery business) than at Premium Textile Components (the components supply business). The Spun Yarn Systems Business Group posted new orders of 695.0 million CHF, equivalent to a decline of 10%. At the Premium Textile Components Business Group this figure was 21% lower than a year earlier, totaling 144.7 million CHF. This trend was due mainly to weaker demand from Chinese and Indian machinery manufacturers, whereas the trend of business with spinning mills was more dynamic. Rieter had a backlog of orders in hand of some 550 million CHF at year-end.

Sales

Rieter’s sales of 888.5 million CHF were 16% lower than in the previous year. The downturn became more pronounced in the second half of the year in particular: as a result of the weak order intake at the beginning of the year, orders postponed by customers until the 2013 financial year and the weaker components supply business, sales in the second half were 18% lower than in the first six months. Sales of 727.6 million CHF by the Spun Yarn Systems Business Group were 16% lower in the year under review, although this business group posted a substantial increase in sales in China compared to the previous year. Sales of 160.9 million CHF by Premium Textile Components were 19% lower.

Result outlook for 2012 confirmed

Rieter confirms the outlook for the 2012 financial year announced on October 30, 2012. Rieter’s annual financial statements for 2012 and the annual report will be published on March 21, 2013, at the results press conference and presentation to analysts in Winterthur.

Annual General Meeting on April 18, 2013

The 2013 Annual General Meeting of Rieter Holding Ltd. will be held in the Eulach Hall in Winterthur on April 18. Any proposals regarding the agenda must be submitted in writing to Rieter Holding Ltd., Office of the Company Secretary, Klosterstrasse 32, CH-8406 Winterthur, Switzerland, by February 22, 2013, at the latest, including the relevant motions and evidence of the necessary shareholdings (par value of 0.5 million CHF as stipulated by Art. 699 of the Swiss Code of Obligations and §9 of the Articles of Association). Please find the Media Release at www.rieter.com/en/rieter/media/press-releases/ and the presentation Orders received and Sales in 2012 at http://www.rieter.com/en/rieter/investor-relations/presentations/2013/. You can also register at www.rieter.com to receive our media releases regularly by e-mail.

For further information please contact:

Rieter Holding Ltd.
Investor Relations
Joris Gröflin
Chief Financial Officer
T +41 52 208 70 15
F +41 52 208 70 60
investor@rieter.com

Rieter Management Ltd.
Media Relations
Cornelia Schreier
Head Corporate Communications
T +41 52 208 70 32
F +41 52 208 70 60
media@rieter.com

Download

Pressrelease (PDF/EN/37 KB)
Pressrelease (PDF/DE/37 KB)

About Rieter

Rieter is a leading supplier on the world market for textile machinery and components used in short staple fiber spinning. Based in Winterthur (Switzerland), the company develops and manufactures systems, machinery and technology components used to convert natural and man-made fibers and their blends into yarns. Rieter is the only supplier worldwide to cover spinning preparation processes as well as all four final spinning processes currently established on the market. With 18 manufacturing locations in 9 countries, the company employs a global workforce of some 4 700, 27% of whom are based in Switzerland. Rieter is listed on the SIX Swiss Exchange under the ticker symbol RIEN. (www.rieter.com) All statements in this report which do not refer to historical facts are statements related to the future which offer no guarantee with regard to future performance: they are subject to risks and uncertainties including, but not limited to, future global economic conditions, exchange rates, legal provisions, market conditions, activities by competitors and other factors outside the company’s control. The 2012 figures have not yet been audited.

Outlook for 2012 adjusted: Rieter expects in the second semester lower sales and operating profitability at around break-even level due to a challenging market environment

Tue, 30 Oct 2012 18:00:00 +0100

Outlook for 2012 adjusted

Rieter currently reckons in the second semester with a weaker trend in sales compared to the first semester. The decrease against the first semester is estimated at slightly above twenty percent due to the shift of machine orders into 2013, cancellations and lower component sales. Rieter expects the operating profitability (EBIT) in the second semester to follow the volume development and to show the effects of a less favorable product mix. The planned investment activity in growth projects and process improvements will further reduce the operating margin (EBIT margin) by around three percentage points. Rieter expects the operating profitability to be around break-even level in the second semester 2012.

Rieter’s product portfolio matches demand in Asia

The Chinese market is generally weaker due to locked-in raw material prices, but looking for automation, upgrade in equipment and lower energy demand. In Turkey, the government incentive program has still not yet shown large effects. In the third quarter, India has seen a pickup in investment demand, with northern India showing more interest than in the southern states.
“China and India will see an increase in demand for machinery and components”, Erwin Stoller said, “offering higher productivity and quality as well as lower energy consumption. Both Rieter’s current product portfolio and its innovation strategy address this demand. With the timely execution of our investment program 2012/2013 Rieter will be ready to profit from these trends.” In the third quarter, a pickup in order intake in the Indian market has been registered. A stable third-quarter order intake in China in a difficult market confirms the attractiveness of Rieter’s product portfolio.
Overall, Rieter managed to increase its order intake in the third quarter compared to the average of the two previous quarters mainly thanks to larger machinery orders. The majority of these orders will be delivered in 2013.

Please find the Media Release at www.rieter.com/en/rieter/media/press-releases. You can also register at www.rieter.com to receive our media releases regularly by e-mail.

Future dates

Publication of sales figures for the 2012 financial year: February 5, 2013
Results media conference and presentation for financial analysts on the 2012 annual financial statements: March 21, 2013
Annual General Meeting: April 18, 2013

For further details please refer to:

Rieter Holding AG
Investor Relations
Joris Gröflin
Chief Financial Officer
T +41 52 208 70 32
F +41 52 208 70 60
investor@rieter.com

Rieter Management AG
Media Relations
Cornelia Schreier
Corporate Communications
T +41 52 208 70 32
F +41 52 208 70 60
media@rieter.com

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Pressrelease (PDF/EN/20 KB)
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About Rieter

Rieter, with registered offices in Winterthur, Switzerland, is a global market leader in spinning machinery and components, with the broadest offering worldwide. The company develops and manufactures machinery, components and systems for manufacturing yarns from natural and man-made fibers and combinations of the same. Rieter is the world’s only supplier of products and know-how covering not only pre-spinning processes but also all four final spinning processes established on the market. The company has 19 production plants in 9 countries and employs some 4 700 people worldwide, of whom about 28 % in Switzerland. Rieter is listed on the SIX Swiss Exchange (ticker symbol RIEN).

Rieter Sustainability Report 2011 published

Fri, 10 Aug 2012 06:50:00 +0200

This 32-page report describes the company’s economic, social and environmental sustainability measures, richly underpinned with key figures, graphic illustrations and commentaries accordingly. Among other achievements, Rieter has further reduced the occupational accident rate and increased the average training time per employee. In China and India, Rieter launched new vocational training courses similar to apprenticeships in 2011. For years Rieter has continuously strived to improve environmental compatibility and energy efficiency along the entire value-added chain. Customers particularly appreciate their substantially lower resource consumption thanks to Rieter’s product and process innovations. With regard to corporate output, Rieter’s energy consumption and greenhouse gas emissions have both reduced by about 20 percent compared with the previous year.
The entire sustainability report is published in German and English on the Rieter website at: www.rieter.com.

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Sustainability Report 2011 (PDF/EN/862 KB)
Sustainability Report 2011 (PDF/DE/860 KB) For further information, please contact:

Rieter Holding Ltd.	Rieter Holding Ltd.
Group Secretary / Corporate Environment, Health and Safety	Media Cornelia Schreier Corporate Communications
T +41 52 208 70 32 F +41 52 208 70 60 gpgs@who-needs-spam.rieter.com	T +41 52 208 70 32 F +41 52 208 70 73 media@who-needs-spam.rieter.com

About Rieter

Rieter, with registered offices in Winterthur, Switzerland, is a global market leader in spinning machinery and components, with the broadest offering worldwide. The company develops and manufactures machinery, components and systems for manufacturing yarns from natural and man-made fibers and combinations of the same. Rieter is the world’s only supplier of products and know-how covering not only pre-spinning processes but also all four final spinning processes established on the market. The company has 19 production plants in 9 countries and employs some 4700 people worldwide, of whom about 28% in Switzerland. Rieter is listed on the SIX Swiss Exchange (ticker symbol RIEN).

Rieter: Good progress with strategic projects in a steady half year

Wed, 25 Jul 2012 06:45:00 +0200

Semi-Annual Report 2012 (English/PDF/493 KB) Order intake amounted to 404.1 million CHF; this was 40% lower than the very strong figure for the first half of 2011. However, in the first half of 2012 Rieter received more orders than in the second half of 2011. Sales of 487.3 million CHF in the reporting period were 9% lower than in the same period of the previous year, as expected. The operating profit before interest and taxes declined from 70.6 million CHF to 32.0 million CHF due to reduced volumes and higher investment activity. This figure corresponds to 7.2% of corporate output (12.8% in the first half of 2011). Net profit was 21.9 million CHF, equivalent to 5.0% of corporate output (91.0 million CHF or 16.5% in the first half of 2011, when a non-recurring capital gain accounted for 42.3 million CHF of the total). In the period under review Rieter completed major steps in the investment program 2012/2013 announced in the spring. The company has achieved the interim targets it aimed for and is on track with this program. The first half of 2012 was characterized by widely diverging trends in the geographical markets of relevance for Rieter. Global economic uncertainties affected the markets for short-staple fiber machinery and components in China and Turkey; in India, demand remained weak also due to industry-specific reasons. Yarn inventories, which were still very large last summer, continued to decline. The overall margin situation at spinning mills improved, although regional differences persist. Compared with the extraordinarily strong period in the previous year, orders received by Rieter declined in the first six months of 2012 by 40% to 404.1 million CHF. Both of Rieter’s business groups – Spun Yarn Systems (machinery, spare parts and service business) and Premium Textile Components (components business) – were affected by this downturn. However, order intake was higher than in the second half of 2011 and was broad-based in geographical terms. Rieter booked the most orders in China, Turkey and other Asian countries including Indonesia and Pakistan. Customers in the Near & Middle East and Africa placed further substantial orders for staple-fiber machinery and technology components. In contrast, order intake in the important Indian market remained at a very low level. Orders in hand, some of which will be reflected in sales in 2013, totaled more than 515 million CHF at the end of the first six months (over 840 million CHF at the end of the first half of 2011). The positive attributes of the product portfolios of both business groups enabled Rieter to further expand its strong market position worldwide, especially in China. Machinery and components from Rieter create competitive advantages for customers in the success factors of yarn quality, productivity, material utilization and energy efficiency. Rieter’s sales of 487.3 million CHF were 9% lower than a year earlier. Rieter booked the most sales in Turkey, followed by China and other Asian countries. Sales in China were 17% higher than in the previous year, but sales in India declined by more than half. Corporate output was 20% lower due to the decline in the order volume, and amounted to 441.1 million CHF. Compared with the first half of 2011, the operating profit before interest and taxes (EBIT) declined from 70.6 million CHF to 32.0 million CHF, equivalent to 7.2% of corporate output (12.8% in the first half of 2011). The operating profit before interest and taxes includes expenditures incurred in the reporting period for the steps completed in the investment program 2012/2013. The expenditures amounted to 12.5 million CHF and reduced the EBIT margin by almost 3 percentage points. The operating profit before strategic projects, interest and taxes amounted to 44.5 million CHF or 10.1% of corporate output. Expenditure on research and development amounted to 20.9 million CHF in the first half of 2012 (19.3 million CHF in the first half of 2011). Lower profitability is also attributable to lower volumes, the weakness of the Indian market and increased pressure on prices for business invoiced in Swiss francs. Major efforts to cut costs and enhance productivity at all locations partly compensated for this. Net profit declined compared with the previous year’s outcome, amounting to 21.9 million CHF or 5.0% of corporate output (91.0 million CHF and 16.5% in the first half of 2011). This reduction was mainly due to the absence of the extraordinary capital gain of 42.3 million CHF arising from the sale of shares in Lakshmi Machine Works in India in the first half of 2011 and the lower operating profit. Rieter employed a global workforce of 4 679 on June 30, 2012 (4 725 on June 30, 2011). In response to the decline in orders Rieter reduced the number of temporary employees to 800 (1 893 a year earlier). The seasonal increase in net working capital and the outflow of funds due to the investment program 2012/2013, resulted in lower free cash flow (-15.5 million CHF) than in the strong equivalent period of the previous year. The payment of a dividend of 27.7 million CHF out of the reserves from capital contributions reduced net liquidity at mid-year to 107.4 million CHF. Rieter continues to have sound finances and an equity ratio of 35% after the dividend payme

Spun Yarn Systems Business Group

Through its Spun Yarn Systems Business Group, Rieter is the world’s only supplier offering machinery and systems covering spinning preparation processes and all four final spinning processes established on the market. Orders received by Spun Yarn Systems totaled 330.0 million CHF in the reporting period. This figure was 40% lower than in the first half of 2011, but considerably higher than in the second half of 2011. Sales of 400.6 million CHF were 6% lower than in the comparative period of the previous year. The operating profit amounted to 27.9 million CHF or 7.6% of corporate output (49.6 million CHF or 11.0% in the first half of 2011). This includes the disposal gain of 6 million CHF arising from the sale of manufacturing capacity in the Czech Republic, which was announced last year and completed in the reporting period. Spun Yarn Systems presented mill-proven and new products at two major textile machinery trade shows in Turkey and China in the reporting period. Rieter machinery and systems met with an especially positive response from customers at the ITM Istanbul in April. The exhibits met the needs of the market especially well in the areas of productivity enhancement and the reduction of energy consumption. At the ITMA Asia, held in Shanghai in June, Rieter launched the E 80 comber as a new model in a very successful product family.

Premium Textile Components Business Group

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 also to various machinery manufacturers. In the first half of 2012, the Premium Textile Components Business Group posted order intake of 74.1 million CHF. This was 38% lower than in the first half of 2011, but the trend was positive compared to the second half of 2011. Business with spinning mill customers was more dynamic than that with machinery manufacturers in the reporting period. Sales by Premium Textile Components were 23% lower at 86.7 million CHF. The operating profit before interest and taxes was 9.3 million CHF or 7.9% of corporate output (21.9 million CHF or 14.6% in the first half of 2011). At the two major trade shows in China and Turkey, Premium Textile Components presented important new products by the Bräcker, Graf, Novibra and Suessen brands that attracted considerable interest from customers. These included, for example, innovations in the components offering that enable customers to achieve greater energy efficiency in their installations.

Progress in the investment program 2012/2013

The investment program announced in the Spring of 2012 (see text below) proceeded as planned in the reporting period. At the close of the first six months of 2012 Rieter has completed the following important steps: Expansion in Asia: Rieter inaugurated the first stage of a further manufacturing facility at its Chinese site in Changzhou. The new premises is already fully operational. Further completion of the main expansion stages is expected at the end of 2013. Innovation: Important interim targets have been achieved in the establishment of the airjet spinning process. For the first time a customer has installed a large integrated system featuring J 20 air-jet spinning machines, i.e. both spinning preparation and the final spinning process. The J 20 air-jet spinning machine also attracted considerable interest at the ITMA Asia in Shanghai. Process improvements: The project for global standardization of business processes is proceeding on schedule.

The projects in the investment program are operationally and financially on track.

Outlook

Rieter will continue intensified investment activity through the 2012 financial year to lay the foundations for further profitable growth (see text below). Rieter business activities are broadly based worldwide. Heterogeneous market development is expected to continue in 2012. Due among other reasons to uncertain economic policies in major national markets, it is difficult to forecast textile machinery industry developments for the current year. Further trends depend on various factors including currency exchange rate development, consumer sentiment in Europe and North America, fiber consumption growth in Asia, and raw material prices. Rieter currently reckons in the second semester with a weaker trend in sales compared to the first semester as part of the order backlog reaches into 2013. Rieter expects operating profitability (EBIT) in the second semester to follow volume development and the planned investment activity in growth projects and process improvements to further reduce operating margin (EBIT) by around three percentage points.

Investment program 2012/2013 for further growth

Rieter expects that global demand for short staple fibers (natural fibers / staple man-made fibers) will grow by an average of 2.3% annually until 2030. The additional spinning capacity this will require, the replacement demand and the trend toward greater automation, especially in the Chinese and Indian markets, will have a positive impact on demand for spinning machinery and components. Against this background Rieter is aiming for overall annual average growth of 5%, half of which should be organic. Rieter’s strategic targets are to retain its leadership in the premium segment and also to expand its position in the local markets in China and India. In the implementation Rieter is focusing on
Expansion in Asia: Further build-up of capacity in China and India;
Innovation: Increased focus on air-jet spinning, improvement of yarn quality, productivity and energy efficiency of machinery and components;
Process improvements: Operational excellence, global standardization and IT support of business processes. In order to achieve rapid expansion in Asia and drive product innovation, Rieter is planning investments totaling some 90 million CHF in 2012 and 2013, somewhat more than half of which will be completed in 2012. A total of some 50 million CHF is foreseen for the further improvement of global processes in 2012/2013, slightly more than half of which is budgeted for the 2012 financial year. These investments will be made in addition to regular maintenance expenditures. Investments in the growth projects will reduce EBIT margin by about 1 percentage point in 2012 and 2013. Investments in process improvement projects will reduce EBIT margin by about a further 2 percentage points in these two years. Through this investment program, Rieter is seeking to achieve an EBIT margin of at least 9% over the demand cycle and greater than 12% in peak years. You will find the full text of the semi-annual report at:
www.rieter.com > Investor Relations > Reports

Future dates

Publication of sales figures for the 2012 financial year: February 5, 2013
Results media conference and presentation for financial analysts on the 2012 annual financial statements: March 21, 2013
Annual General Meeting: April 18, 2013

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Press Release (PDF/EN/37 KB)
Press Release (PDF/DE/40 KB)
For further details please refer to:

Rieter Holding Ltd.	Rieter Management Ltd.
Investor Relations	Media Relations
Joris Gröflin Chief Financial Officer T +41 52 208 70 32 F +41 52 208 70 60 investor@who-needs-spam.rieter.com	Cornelia Schreier Corporate Communications T +41 52 208 70 32 F +41 52 208 70 73 media@who-needs-spam.rieter.com

About Rieter

Rieter, with registered offices in Winterthur, Switzerland, is a global market leader in spinning machinery and components, with the broadest offering worldwide. The company develops and manufactures machinery, components and systems for manufacturing yarns from natural and man-made fibers and combinations of the same. Rieter is the world’s only supplier of products and know-how covering not only pre-spinning processes but also all four final spinning processes established on the market. The company has 19 production plants in 9 countries and employs some 4700 people worldwide, of whom about 28% in Switzerland. Rieter is listed on the SIX Swiss Exchange (ticker symbol RIEN).

Rieter at a glance

		January- June 2012	July- December 2011	January- June 2011	Change¹	Change in local currencies¹
CHF million
Rieter
Orders received		404.1	287.0	671.3	-40%	-40%
Sales		487.3	523.0	537.8	-9%	-9%
Corporate output		441.4	490.6	551.9	-20%
Operating profit before strategic projects, interest and taxes		44.5	56.8	77.7
- in % of corporate output		10.1%	11.6%	14.1%
Operating profit before interest and taxes (EBIT)		32.0	42.0	70.6
- in % of corporate output		7.2%	8.6%	12.8%
Net profit²		21.9	28.0	91.0
- in % of corporate output		5.0%	5.7%	16.5%
Earnings per share²	CHF	5.17	6.22	19.64
Capital expenditures on tangible and intangible assets		24.3	42.9	14.4	69%
Number of employees at the end of the period
(excluding temporary personnel)		4679	4695	4725	-1%
Business Group Spun Yarn Systems
Orders received		330.0	222.3	552.7	-40%	-41%
Sales		400.6	436.6	425.1	-6%	-6%
Corporate output		365.4	416.9	449.4	-19%
Operating profit before interest and taxes (EBIT)		27.9	31.6	49.6
- in % of corporate output		7.6%	7.6%	11.0%
Business Group Premium Textile Components
Orders received		74.1	64.7	118.6	-38%	-35%
Sales		86.7	86.4	112.7	-23%	-21%
Corporate output		118.2	122.4	150.2	-21%
Operating profit before interest and taxes (EBIT)		9.3	13.2	21.9
- in % of corporate output		7.9%	10.8%	14.6%

1. Change January-June 2012 vs. January-June 2011
2. Continuing operations, incl. gain on sale of investments, which amounted to 42.3 million CHF in the first half of 2011.

Rieter inaugurates first part of production plant in China

Mon, 18 Jun 2012 04:00:00 +0200

Rieter’s long tradition of trading relations with China dates back to 1940, when Chinese spinning mill customers purchased their first Rieter machines. In the 1990s Rieter established presence in China with a joint-venture assembly plant, and in 2000 opened its own production plant in Changzhou. Since then Rieter has successively expanded in China with substantially investments in market-specific product development, sales and distribution, local customer services and local manufacturing.

The factory building now opened at this new Rieter plant, the second in Changzhou, is already fully operative. It will enable Rieter to meet customer needs in China significantly more comprehensively. After the successive commissioning of further production buildings, completion of the entire plant is scheduled for the end of 2013. By expanding activities in China, Rieter is following up the strategic goal of stronger growth particularly in local markets. Today Rieter has already established a localized product offering in China that includes a semi-automatic rotor spinning machine, draw frame and combing machines, carding and blowroom machines. To this purpose Rieter is not only expanding production capacities, but also planning production of additional ring spinning machines. By the end of 2013 Rieter aims to offer two localized final spinning processes in China including all preparation stages.

Changzhou will therefore play a key role in Rieter’s global production network.

In his speech at the inauguration ceremony, Erwin Stoller, Chairman of the Rieter Board, said “We are very proud to present this new production plant to you today. It not only follows up our principles of operational excellence, but also sets us new benchmarks. I have got to know our Chinese colleagues here in Changzhou as highly innovative and future-oriented, and I heartily thank them for their enormous commitment.”

About Spun Yarn Systems

Rieter is the leading supplier of installations for manufacturing yarns from short staple fibers.
Rieter is a competent partner, dedicated to making customers’ lives easier by offering care and support from the initial investment discussions to the successful operation of a spinning mill.
Rieter’s comprehensive know-how from fiber through yarn to the finished textiles provides the basis for innovative machines and consistent yarn quality. Rieter is the only leading system supplier, which offers a comprehensive, independent and objective advice covering all 4 spinning systems.

About Rieter

For further information please contact:

Rieter Holding Ltd.	Rieter Management Ltd.
Investor Relations	Media Relations
Joris Gröflin Chief Financial Officer T +41 52 208 70 15 F +41 52 208 70 60	Barbara Rösch Corporate Communications T +41 52 208 70 32 F +41 52 208 70 60

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Rieter Changzhou Plant 2 – Overview
(JPG/CMYK/6.3 MB) (right mouse click, save as) Rieter Changzhou Plant 2 – North Entrance
(JPG/CMYK/5.9 MB) (right mouse click, save as) Rieter Changzhou Plant 2 – Offices and Canteen
(JPG/CMYK/7.0 MB) (right mouse click, save as) Rieter Changzhou Plant 2 – Draw Frame Assembly Line
(JPG/CMYK/7.3 MB) (right mouse click, save as) Rieter Changzhou Plant 2 – Rotor Spinning Machine Assembly Line
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Rieter General Assembly Approves All Board Proposals

Wed, 18 Apr 2012 19:04:00 +0200

The 121st Annual General Meeting of Rieter Holding Ltd was attended by 650 shareholders representing 52.5 % of share capital. They approved all Board proposals, the Annual Report with the annual accounts and consolidated financial statements for 2011, and formal discharge of the Board of Directors and Group Executive Committee members for the business year 2011. Consultative approval of the Compensation Report was confirmed by an 81.55% majority of those present. A dividend of 6.00 CHF per registered share was approved for payment from capital reserves without deduction of withholding tax.

Shareholders voted Dr. Jakob Baer, Michael Pieper, This E. Schneider, Hans-Peter Schwald and Peter Spuhler to the Board of Directors for another 3-year term of office. Mr. This E. Schneider will continue as Vice Chairman of the Board and Lead Director.

By approving an amendment to the Articles of Incorporation, shareholders enabled the creation of authorized capital for the next two years in the amount of up to 2.5 million CHF or 500 000 shares. This assures Rieter of the necessary financial flexibility for exploiting without delay strategic opportunities such as acquisitions.

In his review of the current situation, Executive Chairman Erwin Stoller confirmed prospects for the business year 2012 as announced at the Rieter Results Press Conference on March 21.

Contact persons for further information:

Rieter Holding AG	Rieter Management AG
Investor Relations	Media Relations
Joris Gröflin Chief Financial Officer T +41 52 208 70 15 F +41 52 208 70 60 investor@who-needs-spam.rieter.com www.rieter.com	Barbara Rösch Corporate Communications T +41 52 208 70 32 F +41 52 208 70 60 media@who-needs-spam.rieter.com www.rieter.com

Press release

2011 financial year

Wed, 21 Mar 2012 07:00:00 +0100

The Rieter Group reached a historical turning point in spring 2011. Shareholders adopted the proposal by the Board of Directors to separate the group and for its two divisions – Textile Systems and Automotive Systems – to operate in future as independent companies, each with its own stock market listing. Following the completion of the separation, Rieter is an industrially focused supplier of machinery and components for staple fiber spinning mills. It conducts the business of the former Rieter Textile Systems Division in two business groups, Spun Yarn Systems (machinery business) and Premium Textile Components (components business). Rieter is reporting results to December 31, 2011, for the first time in respect of a full financial year in this new structure.

The 2011 financial year as a whole was encouraging for Rieter. The company again reported striking sales growth and a significant increase in the operating result and net profit. Orders received were 34% lower than in the extraordinarily strong preceding year, achieving a good level of 958.3 million CHF. Rieter therefore still has a healthy level of orders in hand. Sales revenues increased by 22% to 1 060.8 million CHF. The increase in local currencies amounted to 27%. Rieter posted a disproportionately strong increase in the operating result, which rose by 49% from 75.7 million CHF to 112.6 million CHF. This is equivalent to 10.8% of corporate output. Net profit increased to 119.0 million CHF, equivalent to 11.4% of corporate output (82.9 million CHF and 9.9% in 2010). The Board of Directors is proposing that a dividend of 6.00 CHF be paid for the 2011 financial year out of the reserve from capital contributions. Rieter expanded its market position in the year under review and has a strong balance sheet. On this sound basis Rieter intensified its investment activities in 2011, especially in the large Asian growth markets and the development of products to meet the needs of specific markets. Rieter will continue intensified investment activity through the 2012 financial year to lay the foundations for further profitable growth.

Press Release Financial Year 2011

In 2011 the disruption on the financial markets, the currency crisis in Europe and the resulting strength of the Swiss franc created the most dramatic situation for the Swiss economy since the 1970s. Rieter held its own well overall in this difficult environment. The company has systematically assumed a global focus since the 1990s. By transferring manufacturing operations to customers’ markets, in particular to India and China, and also through existing facilities in European countries, Rieter is exploiting the cost benefits of these locations and at the same time limiting currency risks.

The boom in demand on the world market for textile machinery and components experienced in 2010 continued in the first quarter of 2011. The investment climate started to cool off as of the second quarter. The high cost of cotton and declining yarn prices intensified pressure on spinning mills’ margins and liquidity. The second half of the year was also dominated by uncertainty due to the trend in raw material prices and prospects for the global economy. As of the second quarter the market retreated to a lower level compared with the previous year. Demand for yarns also declined in 2011. However, spinning mills were able to reduce yarn inventories to some extent again in the second half of the year.

Orders received and sales

Rieter’s order intake of 958.3 million CHF in 2011 was 34% lower than the very high figure (1 454.6 million CHF) recorded in the previous year. In local currencies the decline amounted to 31%. This downturn was particularly apparent as of the second quarter and affected both business groups. However, the slowdown had less of an impact on the components business (Premium Textile Components Business Group) than the machinery business (Spun Yarn Systems Business Group). Some customers postponed or canceled orders as a consequence of the disruption on the raw material and yarn markets. Cancelations affected orders placed in the peak year of 2010 in particular. Rieter therefore adjusted its order book by a total of 112.6 million CHF in the second half of 2011. Excluding cancelations, orders received in the second half of the year amounted to 399.6 million CHF. Orders in hand at year-end were slightly over 600 million CHF.

China, Turkey and India were the sources of the largest volume of orders. South Korea, Indonesia, the USA, Brazil, Pakistan and Bangladesh were also important markets. All in all Rieter further expanded its market position worldwide in the year under review and gained market share with attractive products. In China and India, Rieter strengthened its market position with a specific offering for the local markets. This shows that Rieter has positioned itself well and made the right investment decisions in earlier years.

The high level of orders in hand from the previous year, which had continued to grow in the first quarter of 2011, utilized Rieter’s production capacity to its limits, resulting in long delivery lead times. The situation eased in the course of 2011 and Rieter was able to supply customers faster again. Sales rose by 22% compared with the previous year, to 1 060.8 million CHF (870.4 million CHF in 2010).

On December 31, 2011, Rieter employed a workforce of 4 695, compared with 4 395 a year earlier. Rieter engaged additional temporary personnel, also at its plants in China and India, in order to cope with the high level of orders in hand. At year-end these totaled 1 157 employees, equivalent to 20% of the entire workforce.

Operating result and net profit

Rieter achieved disproportionately strong growth in profitability through high capacity utilization and attractive products. The operating result before interest and taxes (EBIT) increased from 75.7 million CHF to 112.6 million CHF, corresponding to growth of 49%. The operating margin rose to 10.8% of corporate output, compared to 9.0% in the previous year. Lower sales by the Premium Textile Components Business Group, increased pressure on margins in business invoiced in Swiss francs and higher capital spending on projects to expand capacity in China and India and for innovations and process improvements resulted in a lower operating return in the second six months of the year.

Rieter’s net profit also increased significantly in the year under review, although the financial result was depressed by exchange losses and impairment of financial assets. The higher operating result and a capital gain contributed to this outcome. Net profit amounted to 119.0 million CHF or 11.4% of corporate output (82.9 million CHF and 9.9% in 2010). The capital gain of 47.3 million CHF arose from the reduction in Rieter’s equity interest in Lakshmi Machine Works in India, which was announced on April 1, 2011. Earnings per share on continuing operations therefore amounted to 25.86 CHF (15.63 CHF excluding the capital gain). Return on net assets (RONA) since the separation was thus 19.8% (13.1% excluding the capital gain).

Dividend

Rieter Holding Ltd. posted a net profit of 28.7 million CHF for the 2011 financial year (143.1 million CHF in 2010). The Board of Directors will propose to the Annual General Meeting on April 18, 2012, that a dividend of 6.00 CHF be paid for the 2011 financial year out of the reserve from capital contributions. In the previous year Rieter shareholders received a special dividend in the form of registered shares of Autoneum Holding Ltd., which has been listed on the SIX Swiss Exchange since May 13, 2011, and operates Rieter’s former automotive components supply business. Following the separation of the group, Rieter is aiming for a distribution ratio of about 30%, taking into consideration various factors such as the trend of business, liquidity needs and market prospects.

Spun Yarn Systems Business Group

Order intake of 775.0 million CHF by the Spun Yarn Systems Business Group in 2011 was 36% lower than a year earlier (1 217.9 million CHF). Sales by Spun Yarn Systems were 28% higher at 861.7 million CHF. Due to the high production volumes and good capacity utilization, the operating result before interest and taxes at Spun Yarn Systems almost doubled, rising from 42.4 million CHF to 81.2 million CHF. This is equivalent to an operating margin of 9.4% of corporate output (6.3% in 2010).

Premium Textile Components Business Group

Order intake by the Premium Textile Components Business Group declined by 22% 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% increase in sales to 199.1 million CHF in the year under review. The operating result before interest and taxes rose from 29.6 million CHF to 35.1 million CHF. The operating margin of 12.9% of corporate output exceeded the previous year’s figure (12.5%).

Sound balance sheet and finances

Even after the separation of the Rieter Group and the establishment of the Automotive Systems Division as an independent company through distribution of a special dividend, Rieter still has a sound balance sheet with an equity ratio of 35% (32% in 2010).

Despite the substantial increase in capital expenditure compared with the previous year, especially for expansion in China and India, Rieter generated free cash flow of 79.5 million CHF. Net liquidity therefore improved further to 159.0 million CHF (-3.5 million CHF in 2010).

Rieter’s financial stability is additionally ensured by a 250 million CHF bond issue. On May 10, 2011, bondholders agreed that these bonds should remain in issue until 2015. This assures Rieter of strategic flexibility and the long-term financing of the company’s development.

Separation of the Rieter Group completed

The separation of the group into two independent companies focusing on the textile machinery and automotive component supply business respectively, as announced on March 22, 2011, and approved by the Annual General Meeting on April 13, 2011, was completed as planned. Rieter’s former automotive component supply business has been listed on the SIX Swiss Exchange as Autoneum Holding Ltd. since May 13, 2011. The former Rieter Automotive Systems Division features in the 2011 Annual Report as discontinued operations and appears as a separate item in the income statement. The special effects arising from revaluations included in this are of a technical nature and are non-recurring.

By focusing on the textile machinery business, Rieter can position itself more clearly and operate with greater strategic flexibility. Reporting in the two segments of Spun Yarn Systems and Premium Textile Components creates greater transparency and visibility for shareholders.

Systematic implementation of the strategy for long-term development of the business

On the basis of sound finances and a strong market position, Rieter intensified investment activity in 2011 in order to press on toward the achievement of its strategic goals and lay the foundations for further profitable growth. Investments in tangible assets were increased from 25.8 million CHF to 57.3 million CHF. Both business groups expanded manufacturing capacity in the large growth markets of China and India. By offering specific products, Rieter was increasingly successful in gaining customers who manufacture yarns for the domestic market in both countries. These markets continue to offer considerable growth potential with the increasing prosperity of the population.

Alongside this, in the year under review Rieter also invested in projects and programs to improve global processes and transfer production know-how, which will enhance flexibility, productivity and efficiency worldwide. Rieter will continue to pursue these investment projects in the years to come.

Rieter also accelerated innovation activity at both business groups. In 2011 Rieter increased research and development spending by 21% to 39.5 million CHF or 3.8% of corporate output (32.6 million CHF in 2010). At the ITMA, the industry’s most important trade show worldwide, which was held in Barcelona in September 2011, Rieter presented an updated product portfolio featuring innovations in spinning preparation and all final spinning technologies, in both the machinery and the components segment. Rieter seeks through innovation to strengthen its customers’ competitive position. Important objectives include novel types of yarn, improved utilization of raw material, lower operating costs and energy savings in spinning mills. Rieter is also continuously improving the price/performance ratio of its products.

Expertise in the textile value chain – a competitive advantage

Continuous innovative steps in components and machines are crucial to Rieter’s long-term success. Together with its recognized expertise in the textile value chain and the ability to manufacture high-precision components in volume, innovations secure Rieter’s strong global competitive position. The company is well placed to continue to maintain and extend its technological and innovation lead in the years to come. Rieter has a global customer base and presence and covers all four final spinning technologies as well as the relevant spinning preparation. Rieter is therefore able to optimize the spinning process as a whole.

Strong brands with an international impact

With its long industrial experience, its strong brands in the components business (Bräcker, Graf, Novibra and Suessen) and its extensive expertise in the textile value chain from raw materials to end products, the Rieter company enjoys global recognition. Rieter’s specialists attended not only the ITMA, but a large number of other important trade fairs and symposia in specific markets in 2011. Rieter makes a major contribution to developing know-how throughout the industry through the presentation of research and development results.

Rieter diligently protects know-how of vital business importance through patents and by other means.

Increased flexibility

In 2011 Rieter took a number of steps to position itself more effectively in the marketplace and gain further flexibility. In India Rieter sold its interest in the Rieter-LMW Machinery Ltd joint venture, which had been formed in 1994. This transaction was announced on April 1 and concluded at the beginning of July 2011. Rieter also reduced its holding in former joint venture partner Lakshmi Machine Works (LMW) from 13% to approximately 3%. Rieter thus responded to changes in the market environment and gained freedom of maneuver to expand its own presence in India, thus enabling Rieter to produce machinery and components for the Indian domestic market.

As announced on October 26, 2011, Rieter signed a contract of sale for two manufacturing facilities in the Czech Republic. This move gives Rieter additional manufacturing flexibility and at the same time creates optimal development prospects for these units. This transaction was concluded as planned after balance sheet date.

Board of Directors and Annual General Meeting

Shareholders elected Erwin Stoller to the Board of Directors for a further three-year term of office at the Annual General Meeting held on April 13, 2011. Erwin Stoller continues to chair this body.

Dr. Jakob Baer, Michael Pieper, This E. Schneider, Hans-Peter Schwald and Peter Spuhler are standing for re-election for a further three-year term of office at the Annual General Meeting to be held on April 18, 2012.

Apart from a dividend payment of 6.00 CHF per share out of the reserve from capital contributions, the Board of Directors will additionally propose to the Annual General Meeting that new authorized capital be created to the amount of 500 000 registered shares. This measure will provide Rieter with greater flexibility for financing external growth.

Outlook

Rieter will continue intensified investment activity through the 2012 financial year to lay the foundations for further profitable growth. To accelerate expansion in Asia and product innovation, Rieter plans investment activities totaling around 90 million CHF in 2012 and 2013, about half of which due in 2012. Investments totaling around 50 million CHF are planned in 2012/2013 for further improving global processes, just over half of which in the financial year 2012.

Rieter business activities are broadly based worldwide. Heterogeneous market development is expected for 2012. Due among other reasons to uncertain economic policies in major national markets, it is difficult to forecast textile machinery industry developments for the current year. Further trends depend on various factors including currency exchange rate developments, consumer sentiment in Europe and North America, fiber consumption growth in Asia, and raw material prices.

Against this background Rieter currently reckons for this business year with a sales decline in the high single-digit percentage range compared with prior year and a weaker trend in the first semester. The planned investment activity in growth projects will impact operating margin (EBIT) for 2012 and 2013 by about 1 percentage point, while investment activities in process improvement projects will reduce operating margin in these two years by about another two percentage points. Disregarding these projects, Rieter expects volume-dependent profitability around the prior year level.

Further information about the year-end results as well as the Annual Report 2011 and photos for the media can be found at www.rieter.com (Media>>>Media Kit).
At www.rieter.com you can also subscribe to the mailing list for our press releases.

2011 Annual Results Media Conference

Today, March 21, 09.00 h

2011 Annual Results Financial Analysts’ Conference

Today, March 21, 14.00 h

Location: Maschinenfabrik Rieter, Training Center, Klosterstrasse 32, 8406 Winterthur

Important dates 2012

Annual General Meeting 2012 April 18, 2012

Semi-annual report 2012 July 25, 2012

About Rieter

For further information please contact:

Rieter Holding AG

Rieter Management AG

Investor Relations

Media Relations

Joris Gröflin

Chief Financial Officer

T +41 52 208 70 15

F +41 52 208 70 60

investor@who-needs-spam.rieter.com
www.rieter.com

Barbara Rösch

Corporate Communications

T +41 52 208 70 32

F +41 52 208 70 60

media@rieter.com
www.rieter.com

Key Figures

CHF million		2011	2010	2011/2010 Change in %
Rieter
Orders received		958.3	1 454.6	- 34
Sales		1 060.8	870.4	22
Corporate output ¹		1 042.5	841.4	24
Operating result before interest and taxes (EBIT)²		112.6	75.7	4
- in % of corporate output		10.8	9.0
Net profit ³		119.0	82.9
- in % of corporate output		11.4	9.9
Investments in tangible fixed assets and intangible assets		57.3	25.8	122
Total assets		1 111.4	1 969.1	- 44
Shareholders’ equity before appropriation of profit		387.7	627.6	- 38
Number of employees at year-end ⁴		4 695	4 395	7
Business Group Spun Yarn Systems
Orders received		775.0	1 217.9	- 36
Sales		861.7	674.0	28
Corporate output ¹		866.3	669.4	29
Operating result before interest and taxes (EBIT)		81.2	42.4	92
- in % of corporate output		9.4	6.3	48
Business Group Premium Textile Components
Orders received		183.3	235.2	-22
Sales		199.1	190.6	4
Corporate output ¹		272.6	237.2	15
Operating result before interest and taxes (EBIT)		35.1	29.6	19
in % of corporate output		12.9	12.5	3
Rieter Holding Ltd.
Share capital		23.4	23.4
Net profit		28.7	143.1	- 80
Gross distribution		28.0⁵	- ⁶
Number of registered shares, paid-in		4 672 363	4 672 363
Average number of registered shares outstanding		4 625 281	4 640 220	6
Price share (high/low)	CHF	267/133⁷	343/244⁷
Number of registered shareholders on December 31		7 262	8 415	- 14
Market capitalization on December 31		653.2	1 565.8	- 58
Data per registered share
Earnings per share ³	CHF	25.86	17.18	45
Equity (group)⁸	CHF	81.92	120.57	- 32
Gross distribution (Rieter Holding Ltd.)	CHF	6.00⁵	- ⁶

1 Sales, adjustments for sales deductions and own work capitalized and changes in inventories of products manufactured by the company (see Annual Report page 32).

2 This includes in 2011 costs of projects for the expansion in Asia of about 10 million CHF as well as projects for process improvements of about 10 million CHF, mainly in the second half year.

3 From continuing operations (2011 incl. disposal gain).

4 Excluding apprentices and temporary employees

5 See proposal of the Board of Directors, Annual Report page 80.

6 Special dividend of one registered share of Autoneum Holding Ltd.

7 Source: Bloomberg.

8 Shareholders’ equity attributable to shareholders of Rieter Holding Ltd. per share outstanding at December 31.

All statements in this report which do not refer to historical facts are forecasts for the future which offer no guarantee whatsoever with respect to future performance; they embody risks and uncertainties which include – but are not confined to – future global economic conditions, exchange rates, legal provisions, market conditions, activities by competitors and other factors which are outside the company‘s control.