WEINHEIM, Germany-Increased sales and a tighter rein on costs propelled Freudenberg Group to an 88-percent improvement in pretax earnings last year, the firm reported.
Pretax earnings for the family-owned company rose to $157.2 million, while sales advanced 5.5 percent to $3.03 billion. Retained earnings more than doubled to $81.6 million.
The number of employees shrank slightly to 25,443 worldwide, with the reduction coming primarily from last year's divestiture of small subsidiary companies, the firm said.
Freudenberg-NOK G.P. in North America contributed heavily to the fiscal 1994 improvements, raising its sales 11 percent to $483 million, according to the Freudenberg Group.
Business outside of Germany was livelier than at the firm's core company, Carl Freudenberg K.G., which reported a 2.8-percent rise in sales to $1 billion. As a result, Freudenberg's international activities now make up 63.9 percent of global sales.
Sales revenue in the first four months of 1995 was up 3.5 percent, and management's outlook for the rest of the year is ``not unfavorable.''
Exchange rate differences held down the 1995 gain from what could have been a 7- or 8-percent increase, the firm said. International competition continues to put pressure on Freudenberg to keep costs in line, especially in its German operations, management said.
The firm, which derives about 40 percent of its global sales from elastomer-related activities, has budgeted nearly $230 million in capital investments this year, a 21-percent increase over fiscal 1994 and a healthy 6 percent or more of sales, but still shy of the peak in 1993.
Much of the investment is destined for projects in Asia, where the firm earlier this year formed a co-owned Singapore holding company to oversee emerging Asian activities, especially in China and India. Oil seal production has started in China and a second manufacturing site is being negotiated.
Already this year, the company has entered into cooperation with Phoenix A.G. on the development of vibration-and sound-damping component systems, and has formed a joint venture in the U.S. with Mecaplast S.A. of Monaco to make large volume automotive plastic moldings. The Mecaplast venture, involving Woodland Molded Plastics Corp. in Broadview, Ill., is majority owned by Freudenberg-NOK and will be modernized and expanded, the firm said.
A major investment last year involved the consolidation of all Freudenberg's non-automotive radial shaft seal production at a modernized and expanded site in Weinheim. An older factory in another part of Weinheim was closed, and most of the personnel transferred to the new unit.