SICK Reaches Forecast Targets for 2019 – Solid Growth and Major Investments in Research and Development

May 6, 2020

SICK continued growing in a challenging market environment. Group sales by the sensor producer increased by 7 percent to EUR 1,750.7 million during the 2019 fiscal year (2018: EUR 1,636.8 million). Growth was thus considerably higher than the average for the sensor industry, estimated as -1 percent for 2019 by the AMA Association for Sensors and Measurement. SICK again received a high level of orders – amounting to EUR 1,774.1 million in 2019 (2018: EUR 1,701.0 million). The number of employees worldwide increased by 2.6 percent to 10,204. 

The growth in sales, in addition to measures introduced to increase efficiency, contributed to an increase in EBIT of 13.1 percent to EUR 132.9 million which, as a proportion of 7.6 percent of total sales, remained at a high level. SICK could thus meet its forecast targets for the 2019 fiscal year, despite the company facing a downturn in the global economy, a deepening of global trade conflicts, and a difficult market situation in factory automation in general and the automotive sector in particular. SICK nevertheless continued to follow its innovation strategy and again invested a high proportion of its sales, 11.5 percent, in research and development.

“Many industries are facing a radical structural change and increasingly dynamic digitalization. SICK is adhering to its high level of investments in research and development in order to continue to drive forward new technologies alongside our traditional automation business. This is the only way that we and our customers can exploit the opportunities of digital technologies to enable us to react agilely to rapidly changing economic conditions,” Dr. Robert Bauer, CEO of SICK AG, commented when the balance sheet figures for 2019 were published. Most of the Start-Up Initiatives founded in 2018 have already reached market maturity and contributed to sales with their solutions, for example AI-supported camera sensors or systems for automated guided vehicles in intralogistics.

Major market differences in demand for sensors and application solutions 

The orders received and sales in the individual business divisions and regions were highly heterogeneous, reflecting dynamic economic developments. While worldwide demand fell in Factory Automation, SICK was able to gain market share in Logistics Automation and Process Automation. This broad positioning enabled the company to compensate for stagnation in individual segments. In addition to the presence in established markets, sales activities in the world’s growth regions also contributed towards further increasing sales. 

Sales in the domestic market of Germany were slightly lower than in 2018, decreasing by 0.6 percent. The reluctance of German companies to make investments was responsible for lost sales, in particular in the automotive industry. The fiscal year was considerably more stable in the sales region of Europe, the Middle East and Africa (EMEA). Despite the slowing economy, SICK achieved an increase in sales of 7.9 percent here, where business – especially in Italy, Austria, Sweden and Norway, as well as the United Kingdom – provided a positive impetus. Sales growth of 7.6 percent in North, Central and South America (Americas) was at a similar level. SICK was able to take advantage of further increased demand in intralogistics and transport logistics as well as in the oil and gas industries. The strongest growth region worldwide remained the Asia-Pacific region, where development was dynamic. With growth of 11.3 percent, SICK achieved a double-digit increase in sales again in 2019, with business volumes rising in China and Japan in particular. Currency effects had a slightly positive influence on the development of corporate sales during the 2019 fiscal year. 

High profitability provides a stable basis for turbulent times

Earnings before interest and taxes (EBIT) increased from EUR 117.5 million to EUR 132.9 million during the 2019 business year. This development was supported by easing on the procurement markets and the subsequent fall in extraordinary expenditures to ensure delivery capability. Together with the satisfactory growth in sales, SICK achieved high profitability again in 2019. 

A continuing high level of expenditures and investments are vital to ensure sustainable growth in a volatile market environment. The high profitability of the SICK Group also safeguards the future investments necessary to secure its market position and innovative leadership. Moreover, it gives the company stability during the current coronavirus pandemic, which will have unforeseeable economic effects on the 2020 fiscal year. 

Revenue-generating innovations from the Start-Ups and existing business 

As has been the case in recent years, SICK made major investments in research and development during the 2019 fiscal year. The company spent a total of EUR 202.0 million – 11.5 percent of sales – on R&D activities (2018: EUR 192.5 million). SICK has expanded its product portfolio for existing business in order to ensure that it is even better prepared for fluctuations in individual markets with greater diversification of its range. Product development focused on the networking capability of sensors in the context of Industry 4.0, as well as data sovereignty. SICK sensors are increasingly developing towards sensor intelligence with the integration of application knowledge in the software of individual products, and the possibilities offered by more powerful processors and data storage technologies. 

The Start-Up Initiatives were also highly dynamic, and were able to acquire customer projects and achieve sales. An application involving camera sensors in a neuronal network, for example, was continuously trained by means of deep learning algorithms and could thus be used for package recognition in logistics. 

SICK now has more than 10,000 employees worldwide

Accompanying the growth in sales, the number of employees also increased slightly, by 2.6 percent, during the 2019 fiscal year. 10,204 employees are now active at SICK sites worldwide, of which 1,310 are involved in research and development. Human resources work was largely characterized by the continued buildup of competences to meet the challenges posed by the digital transformation, the need for agility, and increasing complexity. SICK’s continuously high expenditure on training and further education is designed to open up for its employees the opportunities offered by the digital transformation in a highly innovative environment.

High levels of orders received during the first quarter of 2020 – forecasting uncertain due to the coronavirus pandemic

The overall economic conditions were already challenging before the spread of COVID-19. During the initial months of 2020 SICK was able to continue achieving satisfactory levels of sales and orders received. The company observed the start of this coronavirus pandemic, as well as the shutdowns in many countries, with great concern and promptly implemented measures to protect its employees, the company itself, and to retain delivery capability. 

The worldwide effort to slow the spread of this viral infection is a challenge that the world community has never faced before. The economic effects are currently impossible to estimate. It can, however, already be seen that the orders situation and business development during 2020 will be considerably impaired by the medical and economic crisis. But demand for automation solutions, e.g. in logistics, remains high even in the current situation. SICK can continue to use its innovative portfolio of products and services to support companies to overcome restrictions in business processes after the crisis. With its solid financial basis, the SICK Group is promisingly positioned to master this challenging phase.

Source

Related Articles


Changing Scene

  • Andreas Sobotta to Assume Role of Vice President North and South America for Pilz Automation

    Andreas Sobotta to Assume Role of Vice President North and South America for Pilz Automation

    Pilz Automation Safety Canada L.P. announces that their long-term CEO and GM, Andreas Sobotta, will assume the role of Vice President North and South America, effective immediately. He will still work from the Canadian office in Mississauga and visit all other subsidiaries in North and South America. Pilz will take their time to find a… Read More…

  • SEW-Eurodrive: MAXOLUTION System Solutions

    SEW-Eurodrive: MAXOLUTION System Solutions

    Whether in production or logistics operations, MAXOLUTION is synonymous with innovation in factory automation – across all industries and worldwide – helping you achieve your vision of an adaptable and resilient lean smart factory. Under the MAXOLUTION brand, SEW-EURODRIVE creates customized solutions for cutting-edge materials handling technology – from the shop floor through to IT.… Read More…


Sponsored Content
The Easy Way to the Industrial IoT

The way to the Industrial IoT does not have to be complicated. Whether access to valuable data is required or new, data-driven services are to be generated, Weidmuller enables its customers to go from data to value the easy way. Weidmuller’s comprehensive and cutting-edge IIoT portfolio applies to greenfield and brownfield applications. Weidmuller offers components and solutions from data acquisition, data pre-processing, data communication and data analysis.

Visit Weidmuller’s Industrial IoT Portfolio.


ADVANCED Motion Controls Takes Servo Drives to New Heights (and Depths) with FlexPro Extended Environment Product Line

Advanced Motion Controls is proud to announce the addition of six new CANopen servo drives with Extended Environment capabilities to their FlexPro line. These new drives join AMC’s existing EtherCAT Extended Environment FlexPro drives, making the FlexPro line the go-to solution for motion control applications in harsh environments.

Many motion control applications take place in conditions that are less than ideal, such as extreme temperatures, high and low pressures, shocks and vibrations, and contamination. Electronics, including servo drives, can malfunction or sustain permanent damage in these conditions.

Read More


Service Wire Co. Announces New Titles for Key Executives

Bruce Kesler and Mark Gatewood have been given new titles and responsibilities for Service Wire Co.

Bruce Kesler has assumed the role of Senior Director – Business Development. Bruce will be responsible for Service Wire’s largest strategic accounts and our growing Strategic Accounts Team.

Mark Gatewood has been promoted to the role of Vice President – Sales & Marketing. In this role, Gatewood will lead the efforts of Service Wire Company’s entire sales and marketing organization in all market verticals.

Read More


Tri-Mach Announces the Purchase of an Additional 45,000 sq ft. Facility

Tri-Mach Elmira Facility

Recently, Tri-Mach Inc. was thrilled to announce the addition of a new 45,000 sq ft. facility. Located at 285 Union St., Elmira, ON, this facility expands Tri-Mach’s capabilities, allowing them to better serve the growing needs of their customers.

Positioning for growth, this additional facility will allow Tri-Mach to continue taking on large-scale projects, enhance product performance testing, and provide equipment storage for their customers. The building will also be the new home to their Skilled Trades Centre of Excellence.

Read More


JMP Parent Company, CONVERGIX Acquires AGR Automation, Expanding Global Reach

Convergix Automation Solutions has completed the acquisition of AGR Automation (“AGR”), a UK-based provider of custom, high-performance automation design and systems integration primarily to the life sciences industry.

Following Convergix’s acquisitions of JMP Solutions in August 2021 and Classic Design in February 2022, AGR marks the third investment in Crestview’s strategy to build Convergix into a diversified automation solutions provider targeting the global $500+ billion market, with a particular focus on the $70 billion global systems integration and connectivity segments. Financial terms of the transaction were not disclosed.

Read More


Latest Articles

  • Making the Sustainable Transformation of the Process Industry a Success

    Making the Sustainable Transformation of the Process Industry a Success

    By Krystie Johnston and Dr. Manfred Jagiella – Sustainability facilitates opportunity when approached with a mindset to preserve resources and promote circularity. We share one Earth, and it is our global responsibility to care for it for the next generation. Endress+Hauser is one global company that understands this responsibility – and practices it as well.… Read More…

  • Why NOARK’s 12VDC Shunt Trip Coils for MCCBs Make Power Systems Reliable and Safer

    Why NOARK’s 12VDC Shunt Trip Coils for MCCBs Make Power Systems Reliable and Safer

    Circuit breakers are an essential component of any modern electrical system. Designed to protect your home or business from potential overloads or short circuits, these devices are your first line of defense against electrical fires. There are, however, situations where remote tripping of the circuit breaker may be required. It could be for operational reasons,… Read More…