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Balance 2008

Duravit passes the 300 million mark

Bathroom manufacturer invests in innovation and marketing

In 2007, Duravit continued the successful development of recent years and, with a 19.0% rise, again achieved a double-digit growth rate. Overall sales to third parties increased to 311.3 million euros. Thus, for the first time, the Group broke through the 300 million euro barrier.

Duravit’s result is one of the success stories in the industry. This is because, in 2007, the building industry in Germany did not grow but experienced a downturn that was particularly apparent in the second half of the year. In 2007, domestic sales of German ceramics manufacturers fell by 7.1%. By increasing overseas sales, their overall sales grew by 1.2% compared with the previous year.

Despite this downward market trend, Duravit achieved a good increase in turnover in Germany of 2.3%. On international markets, both within and outside the EU, sales in the Group as a whole continued to grow considerably, generally in double figures. The largest part of the growth in sales came from products launched on the market in the last four years with international sales in the Duravit Group accounting for 76.2% of the total.

Duravit now operates with 24 subsidiaries and is present in more than 80 countries. Production takes place at several national and international locations: Hornberg, Schenkenzell, Meissen (Germany), Bischwiller (France), Cairo (Egypt), Istanbul (Turkey) and Chongqing (China). Calculated over the year, at the end of 2007, the Duravit Group had an average of 4,364 employees worldwide. It currently has over 5,000 employees as well as a majority shareholding in a further production location in Tunisia.

Success with “bathroom design from jeans to dinner jacket”

Within the last five years, Duravit has more than doubled its sales. This increase is largely attributable to two success factors: the first is the design strategy that Duravit has pursued consistently in the last 20 years. The second factor that has enabled Duravit to chart new territory is marketing outstanding design in combination with very good value for money. Duravit has been countering the competition from low-price suppliers through gradual and systematic trading up – most recently with the D-Code range launched in 2007. Within the market segment, Duravit now offers high-quality goods at the lowest level; these are well-designed classics that stand for quality and stable value. All products in the range visibly bear our logo. Duravit thus shows, quite openly, that while its name also stands for added value in this price segment it is not a supplier of luxury commodities but of “bathroom design from jeans to dinner jacket”, as chairman of the board Franz Kook describes it.

Step up the pace with technology and innovation

Today, both factors are inextricably linked with the Duravit brand and are confirmed by the strong growth internationally and also the steady improvement of the German market. Duravit’s proven innovative strength faced new challenges in 2007: with the e-mood range, Duravit demonstrated its skill in the field of electronics and sets the course for the development of a further area: innovative technology. This factor is not intended to replace the other two but, as all good things come in threes, it is designed to ensure that Duravit can continue to successfully withstand the increasing competitive pressure. “Thanks to specific development efforts in this area, we see the opportunity to again step up the pace and to maintain the momentum we have gathered in recent years,” explains Kook.
“Duravit branded bathrooms thus encompass state-of-the-art lighting and electrical engineering.” In addition to beautiful design and choice materials, the new developments feature an increasing number of high-tech features – for added value in the bathroom, which is what makes Duravit and its products stand out from the competition.

Major progress in international project business

The interplay of innovative forces has also resulted in major progress in international project business. In 2007 Duravit products featured in prestigious architectural projects throughout the world. A superlative tower is currently being built in the United Arab Emirates: the Burj Dubai. The tower is the work of the Emaar Properties project company and, in its current building stage, is already the world’s tallest building. The tower will feature Duravit’s “barrel”, a vanity unit designed for Duravit by Philippe Starck in 1994. Duravit is supplying more than 1,000 barrels to Dubai, as well as almost 4,000 toilets and bidets and more than 1,600 baths and whirlpools. This hugely pleasing contract is worth millions for the Black Forest-based company. BMW Welt in Munich is a second superlative building featuring Duravit products. Various areas in this masterpiece from the Coop Himmelb(l)au firm of architects are fitted out with sanitary items by Duravit.

Each link in the chain must remain strong

Franz Kook expects the weak market situation in Germany to continue in 2008. At the international level the overall development is likely to remain stable. However, in some markets where Duravit enjoys a good position in terms of market segments, product design and product quality, there has been a loss of momentum. In Europe in particular, because of current demographic and economic developments, there will be a decline in demand for products for new buildings. According to Franz Kook, the company therefore “does not aim to maximise profits but to invest as much as possible in developing innovations and in marketing activities in order to give the Duravit brand greater momentum for the future.” Duravit is planning to invest 40 million euros, the biggest investment volume in its history, in increasing production capacities, expanding the central warehouse and building a new development centre, among other things. However, it is not just a question of increasing performance in individual areas; it is the overall performance that counts. “To continue to develop at this pace, the company must ensure that each link in the chain remains strong. Talent, ideas and the willingness of all employees to make an active contribution determine the future success of Duravit” says the chairman of the board.

The double-digit growth of previous years is to be continued

In order to actively and successfully shape the increasing internationalisation and growth of the company, the Duravit Group is expected to further increase its workforce. A core of employees of many years’ standing with a wealth of experience ensures the continuity of the high performance. Young talents introduce new ideas from all over the world, “a mix that has proven effective in the past”, reckons Kook. Duravit is regarded as an attractive employer with low employee fluctuation. In spite of these less than ideal prospects, Duravit is thus optimistic about the future. Duravit sees the opportunity to continue to grow in 2008/2009. Franz Kook: “The course has been set for the two-figure growth of the previous years.”

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