15/06/2011 Wedemark

Statement of financial position 2010: Sennheiser achieves record turnover - Sennheiser Group´s turnover has increased by 20.1 per cent - Strong market growth in all sales regions

Sennheiser electronic GmbH & Co. KG published its financial statement for the business year 2010 today. The audio specialist has increased turnover to 468.2 million euros, compared to 389.9 million euros last year. This corresponds to an increase of 20.1% and is the largest turnover in the company’s history. Profit increased from 3.8 million euros (in 2009) to 23.6 million euros. Volker Bartels, Spokesman of Sennheiser’s Executive Management Board, emphasised that “All product groups and all markets have contributed to this positive result. One of the important factors which contributed to this result was the revival of the professional side of our business and the highly positive growth at the end of the year, particularly in the consumer segment. Now we have to stabilise this dynamic growth and further expand our business.” On average in the year 2010, the Sennheiser Group employed 2117 people, 1153 of them in Germany.

Consumer business remains the product sector with the highest turnover
The largest part of the company’s turnover came from headphone sales, which contributed 34.9% of total turnover. Following this was wireless microphone sales (25.5%), then Sennheiser Communications products (8.1%) and wired microphones (7.4%). Audiology products made up 6.6% of the total turnover and professional headsets made up 4.5%. Georg Neumann GmbH contributed 3.6% of the total turnover with studio microphones and studio monitors. The conference and information systems sector contributed 3.3%.

Despite a global shortage of electronic components, Sennheiser was able to increase production in 2010, thereby overcoming the immediate effects of the global economic and financial crisis.

Strong gains in Asia, the Americas and Central Europe

Thanks to market growth, Sennheiser managed to reach double-digit figures for its growth rate in all sales regions in 2010. In particular, Asia provided significant stimuli for growth in the electronics industry. In the “Asia and Australia” region, turnover increased from 44 million euros in 2009 to 59.7 million in 2010, an increase of 35.6%. “This positive development shows us that using our own sales subsidiaries on the ground was the right strategic decision,” affirmed Volker Bartels. The audio specialist also grew in the Americas. Turnover increased massively by 26.5% compared to the previous year up to a total of 125.6 million euros. There was a noticeably reversed trend in the “EMEA” region. In this previously decreasing market (-2.8% in 2009), Sennheiser achieved an increase of 14.7%. In the sub-regional breakdown, Central Europe contributed a growth of 17.9%, an excellent result. Generally speaking, sales outside Germany continue to be extremely important for Sennheiser. In 2010, the company’s export ratio was about 83%.

Sennheiser consolidates its position as market leader for headphones

Sennheiser has maintained its position at the top of the headphone market in Europe. According to the latest results from GfK Retail and Technology, Sennheiser is the clear market leader within the EU-16 and stabilised its value-based share of the market of 23% last year. The customer-oriented product portfolio including many new models played an important role in this. Another very positive point was the successful cooperation between Sennheiser and the sports manufacturer adidas in 2010. One of the co-developed sports headphone models, the CX 680, won the CES Innovations Award at the Las Vegas Consumer Electronics Show. In addition, Sennheiser reinforced its premium brand position in the consumer segment with “first class” models such as the CXC 700, an in-ear headphone with innovative digital NoiseGard technology.

Professional business recovers

New products in the Installed Sound sector have sparked up the business
Professional sales also increased in 2010. A major factor here was the stronger demand from theatres and stages, who, after many frequency issues had been straightened out, re-invested in radio-frequency equipment, thereby significantly boosting business in this sector. The new high-end wireless products for professional users, such as the SKM 5200-II handheld transmitter, the SK 5212-II pocket transmitter and the EM 3732-II family of receivers with higher frequency flexibility for flawless wireless transmission achieved good sales figures. In general, the reluctancy to buy which impeded sales in 2009, particularly sales of wireless microphones, was no longer noticed in the professional sector. The product range in the Installed Sound sector was successfully expanded. At the InfoComm in Las Vegas in 2010, the ADN discussion system was introduced, an innovative premium product for the conference market that delivers Sennheiser quality sound.

Investment in innovation

Research and Development (R&D) is a central component of Sennheiser’s business strategy. Spending on R&D in 2010 was 6.1% of turnover – i.e. 28.6 million euros. In order to recognise important future trends quickly, Sennheiser runs a company-owned research facility, Sennheiser Innovation AG in Zurich, Switzerland. Here, with a long-term perspective, Sennheiser analyses future trends showing up on the horizon that may have an impact on Sennheiser’s business and on the audio specialist’s product development. Volker Bartels: “We need to be able to react quickly to changes in the market. This is why we focus on consumer needs in the long-term and try to recognise important developments as soon as possible.“

Goals for 2011: increase market shares, secure manufacturing locations

For Sennheiser and its employees, 2011 is all about implementing the new company structure. Since the first of January, Sennheiser has been organised into three business divisions, allowing them to become even more market and customer-oriented in each specific area of their business. “We have developed a divisional strategy over the last few years and this is now also being reflected in our organisational structure. The company’s new divisional organisation will allow us to perfectly adapt our products, services, processes and especially our way of thinking to our customers’ needs. This is another reason why we look at the future with optimism,” said Volker Bartels.