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DKSH net sales up 0.6pc in 2011 financial year

DKSH, the Swiss market expansion services provider with a focus on Asia, on Thursday said net sales grew 0.6 percent to CHF7.3 billion (USD7.86b) in 2011 financial year. Operating profit (EBIT) jumped 21.7 percent to CHF238 million. Profit after tax (PAT) rose by 25.7 percent to CHF 152m.

The company’s good financial performance resulted mainly from organic growth – actively growing existing business and acquiring new clients and customers. The rapidly rising middle class of Asia’s emerging economies is driving demand for high-quality consumer goods and healthcare products which, in turn, is having a direct and positive impact on consumer markets. In DKSH’s assessment, this demand is also boosting overall consumption in Asia’s markets and consequently leading to a rise in the need for Western materials and technologies in order to build local infrastructures and production capacities to manufacture products locally.

The resultant market dynamics are not only promoting trade with the West; inner-Asia business is also benefiting from the sustainable impetus generated by the growing affluence of the middle class. At the same time, increasing numbers of companies are faced with the need to focus on core competencies. Those intending to expand in Asia are therefore relying increasingly on specialised service providers dedicated to market entry and expansion. Thanks to its traditionally strong presence and capillary market coverage across Asia, combined with the rising demand for outsourced market expansion services, DKSH was able to benefit from these economic megatrends and registered impressive 2011 financial results.

To complement its organic growth, DKSH exploited suitable opportunities and closed five strategic "bolt-on" acquisitions in 2011. In Taiwan, the field marketing specialist 3D Asia was acquired, allowing DKSH to further enhance its leadership position in the consumer goods market within the geographic triangle of South mainland China, Hong Kong, and Taiwan. In New Zealand, DKSH acquired Brandlines and FNZ Brands – two leading full-service companies in the consumer goods sector. In Australia, DKSH succeeded in making an important acquisition in the specialty chemicals industry by taking over Tiger Chemicals Company. Moreover, in the middle of the year, DKSH acquired a majority shareholding in the Swiss watchmaker Maurice Lacroix.

All four Business Units performed well and contributed to DKSH’s growth in profits in 2011. Consumer Goods, the largest Business Unit of DKSH, grew its EBIT by 22.2 percent. The second largest, Business Unit Healthcare, increased its EBIT by 10.3 percent. Business Unit Performance Materials reported a rise in EBIT of 7.7 percent, while Business Unit Technology realised an EBIT growth of 8.0 percent for 2011.