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Oerlikon and Saurer， all Swiss， are integrated into one. Theold Saurer in Chinese market is not to be forgotten， but to bestrengthened. Oerlikon textile， under the umbrella of OerlikonGroup， is expected to enter its prospective， even golden time...

Integration

Since the beginning of 2007， Saurerand its brands became a new part ofOerlikon-a synonym for high-techinnovation and customer benefit aroundthe world. Oerlikon has been a pioneerin vacuum technology and the inventorof thin-film coating， and it could provideinnovative and economical solutionsfor the man-made fiber plant designing，nonwovens production and systems froring spinning， rotor spinning， windingand embroidery. This is what it says onthe calling card of a global player aim-ing to play a decisive role in shaping thetextile world of today and tomorrow:Oerlikon Textile， a segment of the high-tech Oerlikon Group.

This orientation to the requirementsof a modem， dynamic market is based ona wealth of experiences. Oerlikon Tex-tile can draw on the strengths of thosetwo traditional Swiss companies. Oer-likon has been driving technical progressfor 101 years; Saurer AG， acquired in2007， for even longer-154 years. In allthis time both companies have been con-stantly setting new global standards intechnology for coating， vacuum， textiles，transmissions and precision components-with the aim of contributing to the suc-cess of their customers.

The roots of Oerlikon Textile liein Europe， but its plants and officespopulate the entire world. Approxi-mately 8，000 employees currently workat 50 production and service locationsinternationally， mostly in multiculturalteams. The principal markets are inAmerica， Turkey， the Middle East andin recent years increasingly in Chinaand India， the big growth regions in thetextile industry.

The large operating radius of Oer-likon Textile is not only geographical. Italso extends to the various applicationsand end products created with the aid ofinnovative manufacturing technologiesin downstream process stages: from cot-ton T-shirts to high-tech fibres in aircraft，from nappies to delicately embroideredlingerie， from spacesuits to substratematerials in transplant medicine.

Synergy effects are yielded aboveall at the technological level. Oerlikon'sexpertise in surface coating and wearprotection for tools and componentswill directly benefit the further develop-ment of former Saurer products such astextile machines and gears.

Conversely， Saurer's core areas ofcompetence in the field of mechatronicassemblies， such as magnetic bearingassemblies， are of interest to Oerlikon.

This calls for the integration of theformer Saurer business units. It wasthus decided in the first quarter of 2007to establish a coating centre of OerlikonBalzers Coating at the Chinese textileplant in Suzhou-a first step towardsmaking joint use of locations world-wide. Oerlikon Leybold Vacuum hasalso begun collaborating with OerlikonSchlafhorst， now a business unit of Oer-likon Textile， to participate in the know-how for innovative drives. The samegoes for the former Saurer segment Oer-likon Graziano Drive Systems， which isnow exploring the potential of coatingprocesses for transmission technologytogether with Oerlikon Balzers Coating.

To be able to meet the respectiveuser requirements of customers satis-factorily， Oerlikon Textile is structuredinto five business units:

Oerlikon Neumag (staple fibresystems， nonwovens systems， carpetyam systems);

Oerlikon Barmag (filament yarnsystems， texturing systems);

Oerlikon Schlafhorst (Jinsheng-Saurer spinning preparation systems，rotor spinning systems， Zinser ringspinning systems， winding systems);

Oerlikon Saurer (Allma Volk-mann twisting systems， Saurer andMelco embroidery systems);

Oerlikon Textile Components(components for the textile machineryindustry).

Quarterly Figures in2007

In its first quarter as a new groupsegment， Oerlikon Textile made con-siderable progress. Integration intoOerlikon is yielding the first fruits ofsynergy and offers both technologicaland market opportunities，

Oerlikon Textile has got its futureas part of the Swiss high-tech industrialgroup Oerlikon off to a flying start. Inthe first quarter of 2007， the supplier ofcomplete textile machinery and plantengineering solutions increased sales by32% over the previous year from 364.9million USD to 459.8 million USD. Theorder intake also grew by 26% from418.9 million USD to 527.3 millionUSD， boosting the order book total by29% to a record value of 743.3 millionUSD at the end of the ctuarter. And theprospects for the Oerlikon segment inthe current financial year are rosy， forthe principal textile markets continue tolook healthy. (See Sheet 1)

\"The first quarterly figures fromOerlikon Textile are pretty impres-sive. Continued growth is expected-especially in Asia.\" The head of Oer-likon Textile， Dr. Carsten Voigtlanderbelieved that. Reflecting on the success-ful launch of the group's new segmentand looking forward to a promising fu-ture， Dr. Carsten Voigtlander presentedthe reasons why Oerlikon Textile willconsolidate its market leadership.

Q: What development do you findparticularly pleasing against this back-ground?

A: With our Oerlikon Schlafhorstbusiness unit we have precisely thefight products to be able to participateto a considerable extent in the continu-ing boom in the natural fibre marketsof China and India. Another significantsource of profits is the Textile Com-ponents unit following the successfulrestructuring of entities such as Temcoor Heberlein， which have been newlyacquired in the last two years.

Q: What objectives have you setfor 2007 and beyond?

A: First we intend to carry on withthe successful growth strategy we haveimplemented in the last couple of years，and to improve our operating incomefurther. To do this， it's important toextend our local presence in order togain further market share， especially inIndia， China and Russia. Another keyaspect is the marketing of completeinstallations on green field sites. One ofthis year's major projects is surely thecomplete integration of the former San-rer AG into the Oerlikon Group.

Q: Won't integration tie up re-sources that are needed for the operat-ing business?

A: The main burden of this fallson the support functions. Our customerrelations are not affected by it. We'realready making good progress and aimto have essentially completed the inte-gration process by the end of the year.

Q: What additional trump cardsdoes Oerlikon Textile gain with integra-tion into the Oerlikon Group?

A: The total solutions strategy ofOerlikon Textile means that we can of-fer our customers complete \"one-stop\"solutions covering everything frommachinery manufacture via processknow-how to turnkey installations andfinancing. And we benefit from theadvantages of a global network. Forexample， the Renova Group， a majorshareholder in Oerlikon， plays a keyrole for us in opening the doors to thetextile market of the future in Russia.We were scarcely represented therehitherto. Conversely we also offer Oer-likon opportunities to gain a footholdin the powerful markets of China， Indiaand Turkey.

Q: What market trends are current-ly discernible and how do you intend toprofit from these?

A: The nonwovens market willgrow and become further consolidated，and we will participate in this. This ishappening in the places where our maincustomers are currently located， thus inthe USA， Europe and Japan. However，this and other textile industries are alsoblossoming in Asia and above all inChina. In this region and in India wewant to be active in the natural fibremarket at the same time， complete thetextile chain in fibre preparation andgain the market leadership with tar-geted product offers. Upgrading andequipping our sites in China and Indiaare further measures with which weaim to meet the growing demand in themedium-price segment.

Q: What major projects are cur-rently in the pipeline?

A: ITMA， the world's biggest tex-tile machinery fair in Munich， is loom-ing on the horizon. We intend to exhibitinnovative highlights at this. We are alsoin talks regarding several large projectsin Russia， China， Turkey and India.These are good reasons to look forwardto a successful second half of the year.

New Opportunitiesfor Growth

Opening up new markets also of-fers such opportunities. Oerlikon hasbeen working for some time on a strat-egy for entry into the Russian marketthat is also benefiting Oerlikon Textile.This region， in which Saurer was notso strong represented， is now one ofthe textile markets of the future. On theother hand， Oerlikon is benefiting fromthe fact that Saurer is well positionedabove all in China， India and Turkey-markets in which Oerlikon has donelittle business hitherto.

Another factor is that Oerlikonand Saurer， those two traditional Swisscompanies， along with an ongoingcommitment to achievement as marketleaders， unite together in their orienta-tion and direction. Oerlikon's strategyof occupying or aspiring to the num-ber one or two slots in its respectivemarkets thus already forms part of theestablished corporate culture of formerSaurer employees.

Nevertheless， the integration of aninternational company with more staffpresents a challenge. For this reasona transformation programme has beendeveloped to ensure smooth integra-tion into the Oerlikon Group. Thisranges from the harmonization of brandidentities via process assimilation tostandardization of the IT systems. Theprogramme should also open up newsources of growth and help to increaseprofitability thanks to efficient costmanagement. \"Integration has one goalabove all: it should strengthen the com-petitiveness and innovative ability ofour company as a whole\"stressed Dr.Carsten Voigtlander.