Trelleborg to alter organisational structure

At its Capital Markets Day earlier this month, Swedish firm Trelleborg outlined a new organisational structure. As of 1 January 2013, the Trelleborg Group will be divided into five business areas; Trelleborg Coated Systems, Trelleborg Industrial Solutions, Trelleborg Offshore & Construction, Trelleborg Sealing Solutions and Trelleborg Wheel Systems. The company says the new arrangement makes for a “more focused” organisational structure.

“We have always had a market-driven approach,” commented Trelleborg Group president and CEO Peter Nilsson. “Our more focused organisational structure affirms that and makes our focus on selected segments more visible to our stakeholders. Fundamental to all we do is accelerating our customers’ businesses and we do that by providing solutions that give a better function, lead to better business, with better sustainability.

“Our solutions are based on polymer engineering,” Nilsson continued. “This is part of our core capabilities, as are our applications expertise, customer integration, local presence with global reach and our position as a business accelerator. We have emerged from a conglomerate into a focused polymer group with clearly defined strategic markets. Our evolution is powered by an improving geographic balance, a market-driven structure, optimisation of our portfolio of offerings and excellence in all we do.”

The company also released its new financial targets. These are, it says, “in line with Trelleborg’s ambitions to increase value creation and to be a world leader in selected market segments and geographic markets.” The Swedish firm stated it will pursue five per cent or above organic growth and a before interest and tax operating margin of 12 per cent or above of sales. Return on shareholders’ equity is set to be 15 per cent or above.

“Trelleborg’s new financial targets shall be seen as realistic, reachable and in line with responsible risk taking,” shared Nilsson. “We have exceeded our previous financial targets and our ambition is to exceed these new targets as well.”

During the Capital Markets Day, Trelleborg highlighted its progress towards an improved geographic balance. While sales in Western Europe, where Trelleborg has traditionally been strong, show a seven per cent increase from 2006 to third quarter 2012, sales in emerging markets have boomed percentage-wise. The South and Central Americas region has seen an increase of 88 per cent, Eastern Europe a 71 per cent growth and Asian sales have almost doubled, at 181 per cent.

“Organic growth and investments in emerging markets have been key to improving global balance,” commented Nilsson. “For instance, in 2005, Trelleborg had only two locations in China. Now there are six manufacturing and development sites along with many sales and engineering facilities. Similarly in Brazil, we have expanded our presence to more than ten manufacturing, development, engineering and sales locations that represent all parts of the Trelleborg Group.

“Getting the balance right in terms of geography and our portfolio of solutions has been achieved through organic focus on the right segments and geographical areas as well as strategic divestments, acquisitions and investments,” the president and CEO added. “Our new organisation focuses on selected segments with growth opportunities and will act as the perfect platform for the next successful leap in Trelleborg’s evolution as a global leading force in polymers.”