Silver Lining: Conditions Lead to Good Year for Grundfos

April 1, 2011
Good 2010 includes elimination of debt

The international debt crisis, the increasing oil prices, and the growing need for energy efficiency led Grundfos to focus on internal process efficiency and global sustainability. The focus resulted in record sales in 2010 for the global manufacturer of pumps and pumping systems for HVACR applications. In its annual report for 2010, Group President, Carsten Bjerg says it was Grundfos' best year in its history.

The 2010 sales reached $3.7 billion with profit before tax reaching $455 million, compared to $3.2 billion and $169.7 million, respectively, in 2009. With this result the company in 2010 returned to a level of activity equal to those prior to the global financial crisis.

“This is a good result. Even better than we hoped. It will be used for investments in new growth. For instance, we shall soon be launching new energy efficient solutions that will no doubt attract attention, and we shall continue the globalization of our activities in growth markets, says Bjerg. “The fact that, in a difficult and challenging time, we managed to expand the technological and commercial lead in the market and, at the same time, managed to limit costs, is a strong example of management and staff’s strong performance and cooperation,” Bjerg says.

“Today, we estimate of every tenth newly installed pump worldwide wears the Grundfos name. At the turn of the year the Group even managed to abolish all debts with an interest-bearing net deposit of $325 million compared to net debts of $18 million at the start of the year”, Bjerg summarized. Due to Grundfos’ special ownership, the profit gained will be reinvested directly in the business, with special focus on investments in technology and product development. Grundfos investments in technology and product development will reach $184 million in the coming year. In addition investments in production equipment will be doubled, for instance with new production facilities in Russia, Serbia and India.

“The North American region will also bee the beneficiary of some the enhanced investment activity” according to Jes Munk-Hansen, regional managing director for North America, commenting from Grundfos' North American headquarters in Olathe, KS.

“All Grundfos employees shared in the success as the company announced at Christmas time every employee would be awarded an extra weeks pay” Hansen says.

Grundfos’ economic growth will be used for continuous development and growth. However, sources says growth must be sustainable and so the company maintains an ambitious goal of never emitting more carbon than in 2008.