“The future of the European rotogravure market will be determined by just a few suppliers,” predicts Bernd Rose, chairman of the board at schlott gruppe AG. Even though the outlines of the consolidation process are already evident on the European market – by contrast with the US market, which has just three providers, Europe has more than 30 competitors – Rose knows: “It’s not just the cartel law that is setting the boundaries – customers are too.” The aim should be to develop a sensible market structure that satisfies both customers and providers equally. Bernd Rose: “France has already shown us that monopolistic structures don’t work. With the solid entry of Quebecor and the achievement of a dominant role on the market, a new provider is currently being created. Because French customers look specifically for alternatives, larger contracts are already increasingly being awarded to neighbouring foreign countries. Because of the customer structure on the rotogravure market, market power has no durability.” For Rose, by contrast, a balanced interplay with up to seven providers throughout Europe is the most realistic future scenario in the mid-term. In this constellation, capital intensity and cost management are balanced with adequate margins – and also with the interests of customers and providers.  

The schlott gruppe actively initiated the consolidation process itself with the integration of wwk (1996), the Sebaldus Group (2000) and the Broschek Group (2002). The proposed amalgamation of Springer’s and Arvato’s rotogravure operations therefore came as no surprise to Rose. The publishing houses’ increasing willingness to separate from their print activities had long been foreseeable. Bernd Rose: “But as number 3 on the European rotogravure market, we can view these activities without concern. Having print operations in Freudenstadt, Landau, Nuremberg and Hamburg puts us in an excellent geographic position; our fleets are unquestionably the very latest, and about one-quarter of our rotogravure turnover is already coming from within Europe.” The construction of the new Nuremberg Hafen works and the acquisition of two new 3.64-m-wide rotogravure web fed presses has enabled the schlott gruppe to reduce the average age of its equipment to less than 10 years (industry average 14 years).

The schlott gruppe continues to see itself as a vanguard in development. Rose: “We act on visual estimates. Only something that is of equal benefit to our customers and to us increases value. And we are committed to increasing value for the benefit of our shareholders and fellow workers.” Thus the merger with the Sebaldus Gruppe took place from the aspects of “Growth spurt” and “Portfolio extension”, the acquisition of Broschek under the leitmotifs of “Northern production site” and “Reinforcing the European presence”. 

At the recent end of the 2002/2003 business year (30.9), the schlott gruppe and its three divisions of high performance printing, direct marketing and digital services, had achieved a turnover of some 620 million euro and an EBT of more than 12 million euro. The schlott gruppe employs a workforce of some 4400 in its 26 subsidiaries throughout Europe, of whom about 2750 are in high performance printing.

Gerda Herzog;
schlott gruppe AG i.I.
Innere Cramer-Klett-Str. 4-8
90403 Nürnberg
GERMANY
Tel.: +49 911 5325-601
Fax: +49 911 5325-604
gerda.herzog@schlottgruppe.de
www.schlottgruppe.de