Rotary – On course for growth despite decline in sales
The Rotary Business Unit successfully continued its profitable expansion in 2023. Although the Unit suffered a decline in sales due to the volatility of the semiconductor industry, normalization of the market since the end of 2023 gives Rotary confidence that it will return to its growth path in 2024.
Rotary used the past year to prepare the organization for the future and to pursue strategic goals. Three acquisitions enabled the Business Unit to further consolidate its market position and thus lay a further foundation for future growth in various industries. In cooperation with the Automotive Division, measures for value analysis and value enhancement (VA/VE) were also successfully implemented, leading to an increase in operational excellence and competitiveness.
"We have expanded our global production capacities to meet the growing demand on the semiconductor market."
and Member of the Executive Board
(since April 1, 2024)
Emerging industries and new products
After several record years in a row, the weak semiconductor market led to temporary delays in growth in 2023, resulting in a 9.5 percent decline in sales. In the paper and cardboard market, on the other hand, Rotary made strong gains and stabilized its overall profitability at a high level. The oil and gas industry, particularly in the offshore sector, also experienced a significant upward trend due to increased demand.
In addition to various product optimizations, Rotary made great progress in the development of contactless slip rings for data transmission. This patented innovation represents a high-performance and cost-effective alternative to contact slip rings. As a contact slip ring wears out due to friction, the probability of errors during data transmission increases. The contactless slip ring solves this problem. In addition, contactless slip rings ensure high-speed data transmission even in environments with strong electromagnetic interference.
Acquisitions in the USA and Brazil
In the summer of 2023, Gardner Systems in Wisconsin, a leading provider of steam and condensate systems for the paper industry, joined Rotary. Thanks to the alliance with this long-standing partner, HOERBIGER is now able to offer customers turnkey services for the rebuild or optimization of paper machine drying sections.
Rotary made another significant acquisition at the turn of the year with the takeover of Minor Indústria Mecânica de Precisão Ltda. The São Paulo-based family business was previously a competitor. By expanding in South America, HOERBIGER is tapping into a new market segment and continuing to pursue its strategy of strengthening customer loyalty and establishing local production sites.
With the acquisition of Diamond-Roltran LLC, based in Littleton, Massachusetts, the world’s leading manufacturer of maintenance-free slip rings, known as Roll-Rings®, joined HOERBIGER in March 2024. This acquisition enables Deublin to add a unique technology to its existing portfolio
Generation change initiated
Rotary has set an important course for the future in 2023. Due to the retirement of long-serving employees as well as strategic considerations, comprehensive succession plans have been initiated in the USA, Germany, the UK, China and Japan. Many of these are already effective, while others are being implemented in ongoing handover processes.
In Mainz and Waukegan, the first phase of organizing production according to value streams has been completed, allowing the flow of materials to be optimized. In addition, a new goods receipt facility is currently being completed in Mainz. Due to continued growth in South America, Deublin has decided to double its production area in Brazil. Construction work has already begun.
Continuation of the expansion strategy
The Rotary Business Unit is preparing for the expected upturn in the semiconductor sector in 2024, which experience has shown will be accompanied by a high level of intensity. In addition to the successful integration of the acquisitions made, Rotary plans to acquire further companies in strategic business areas to drive forward its expansion strategy. In addition, further VA/VE measures will be introduced to sustainably increase competitiveness.