Continued investment pays dividends
As I mentioned in the last issue of Perspectives, we have maintained our investment in the development of new products and applications over the last four years, despite the downturn in the global economy, to ensure our businesses maintain their leading market positions. This strategy has now brought rewards, as our 2003 results and 2004 trading update indicate.
2003 saw us achieve an organic growth rate of 7%, despite customer confidence improving only slowly as the year progressed, a rate which outperformed both many of our peer group and the underlying markets. The main reason behind this growth is that we have continued to invest in critical areas such as new product development, shifting the mix of staff from operations and administration towards sales and marketing, and increasing our presence in the rapidly developing economies of China, India, eastern Europe and Mexico.
As you will read in the article China perspective in this issue, we now have over 700 people in China, with more than 110 employed in direct customer-facing functions. We have also made a number of acquisitions in Asia, with Malvern Instruments and Brüel & Kjær establishing a direct presence in China and Japan respectively to better serve customers in this growing region. You can read more about these acquisitions here.
Innovation is not just limited to products, but also to improving business practices, including relationships with suppliers. An example of this is Microscan's software applications management programme with Microsoft, as demonstrated in the article here.
In summary, the actions we have taken to build a strong product portfolio and expand our sales coverage, particularly in Asia, have improved our competitive positions and put us in a strong position to benefit from the current market conditions.
Hans Nilsson
Chief Executive