APC 2005 Annual Report Download - page 53

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51
4 / Business Review
Business Review
1
2005 highlights
The year’s results confirm that Schneider Electric has
a new profile. Schneider Electric has become a growth
stock by actively going out and seeking growth. This
has meant developing our lineups in high-potential
markets and segments and investing in high-growth
emerging economies.
The year was also shaped by the introduction of new2,
our four-year Company Program. New2is designed to
accelerate and amplify the transformation initiated by
its predecessor, NEW2004. Its three priorities are
growth, efficiency and people.
Growth
We are pursuing an active strategy of organic and
acquisitions-led growth to speed the development of
new businesses, stimulate innovation, step up the
pace of new product launches and extend our geo-
graphic coverage so we can serve customer expecta-
tions even more effectively.
Targeted acquisitions
Schneider Electric made five key acquisitions during
the year to strengthen its presence in three strategic
areas: energy management, industrial and building
automation and ultra terminal electrical distribution.
Over a full year, these new businesses represent rev-
enue of around 750 million.
In energy management, we extended our lineup by
bringing in Canada’s Power Measurement Inc., a
leader in smart energy management systems for
energy suppliers, service companies and energy-hun-
gry manufacturers. Power Measurement Inc. generat-
ed revenue of $59 million in 2005.
In building automation, we acquired ABS EMEA,
Invensys’ advanced buildings systems business in
Europe and the Middle East. ABS EMEA reported rev-
enue of 132 million for the year ended March 31,
2005. It has been folded into Tour Andover Controls
(TAC), a major player in the building automation market.
In industrial automation, we added California-
based BEI Technologies Inc., a manufacturer of cus-
tomized sensors for application positioning and moni-
toring systems used by the automobile, aerospace
and manufacturing industries. With revenue of more
than $300 million in 2005, BEI Technologies signifi-
cantly enhances the customized sensor platform,
which already includes Crouzet Automatismes and
Kavlico.
Schneider Electric has also announced the acquisition
of California-based Silicon Power Corporation’s solid-
state relays business, to be finalized in first-half 2006.
Sold under the Crydom name, these solid-state relays
lead the North American market, generating revenue
of $30 million in 2005. With this acquisition, we will
become the global market co-leader in an industrial
control segment that dovetails nicely with contactors,
where we rank first worldwide.
We increased our interest in Germany’s ELAU AG to
100% during the year. The world leader in automation
solutions for packaging machines, ELAU posted rev-
enue of 48 million in 2005.
In ultra terminal distribution, we acquired Juno
Lighting, North American leader in the design, assem-
bly and manufacture of track and recessed lighting.
Juno Lighting has an excellent reputation for quality,
innovation and service, supported by a network of
more than 2,100 distributors in the US and Canada.
Sales for the year ended November 30, 2005 totaled
$274 million. As part of Square D, Juno Lighting
strengthens our positions in the residential and com-
mercial building and renovation markets in the United
States.
New technological partnerships
In the Buildings market, TAC and Philips Lighting
signed a commercial cooperation agreement in
Europe that will allow their customers to experience
complete open and integrated building automation
solutions, including advanced lighting. These solutions
will provide greater comfort and energy savings.
In the Industry market, Schneider Electric and IBM
signed an international joint development and cooper-
ation agreement targeting the microelectronics and
food and beverages industries. The partners’ goal is to
make it easier to integrate Schneider Electric’s Trans-
parent Ready™networked PLC architectures with
IBM’s WebSphere product lifecycle management
software. Users will see their production lines
enhanced with high performance solutions for quality
and traceability control.