|
Liquid Crystals | Key figures |
[ XLS ] | ||
|
|
|
|
|
|
€ million |
2007 |
2006 |
Δ in % |
|
916 |
895 |
2.3 | |
|
Gross margin |
611 |
592 |
3.3 |
|
79 |
67 |
18 | |
|
487 |
486 |
0.1 | |
|
– |
– |
– | |
|
425 |
372 |
14 | |
|
Free cash flow adjusted for acquisitions and disposals |
425 |
372 |
14 |
|
ROS in % |
53.1 |
54.3 |
– |
Liquid Crystals | Total revenues
According to studies published in August 2007 by the market research firm iSuppli, LCDs now clearly have the edge over the rival plasma-screen technology. In 2008, around 100 million LCD TVs are expected to be sold worldwide, thus exceeding the volume of conventional cathode-ray televisions sold. According to forecasts by the market research firm DisplaySearch, the volume of the liquid crystal market for all applications is expected to grow by around 20% in 2008.
Double-digit organic growth in total revenues
In 2007, total revenues of the Liquid Crystals division rose by 2.3% to €916 million – in spite of negative currency effects, which had an even stronger impact than in the previous year. This applies to the U.S. dollar as well as the Japanese yen, South Korean won and Taiwanese dollar. Organic growth was 14%. The division thus successfully asserted its position in an increasingly competitive environment. Again, Merck generated most of its business with major display manufacturers in Asia. In the year-on-year comparison of total revenues, it should be noted that the business with ITO (indium tin oxide) coated glass in Taiwan was divested in December 2006.
Free cash flow increases by 14%
At €611 million, the division’s gross margin was up 3.3% compared to the previous year. The operating result stagnated at €487 million. Return on sales was 53.1%. Free cash flow increased by 14% to €425 million. This high growth rate compared to the previous year was partly attributable to investments in production facilities at the Darmstadt site in 2006, which reduced free cash flow.
Capturing the Chinese market
In regional terms, sales grew slightly in South Korea – due to currency effects nominally by 1.1%. In Taiwan, sales increased by 1.4%. In Japan – where LC technology originated – Merck achieved growth of 11%. An interesting new market is opening up in China, where the division also expanded business. The total volume of this market, however, is still far below that of the three above-mentioned “home countries” of the LC business.
