.... hab ich heute von einem Bekannten bekommen. Ist vielleicht auch interessant, und Geheimnisse sind keine drin, also stell ichs ein. Viel Spass beim lesen.
Von: Bauer Peter (IFAG CEO)
Gesendet: Mittwoch, 12. August 2009 10:41
An: All Infineon Employees
Cc: Bauer Peter (IFAG CEO); Eul Hermann (IFAG Member of the Management Board); Ploss Reinhard (IFAG Member of the Management Board); Schroeter Marco (IFAG CFO)
Betreff: Review of the capital increase and Q3 results / Nachlese zu Kapitalerhöhung und Q3-Ergebnissen
German version see below
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Dear Colleagues,
Our third quarter results and the successful outcome of our capital increase have met with a very positive response in the press, but also among our customers and in the market. The positive trend displayed in liquidity – despite the crisis conditions – and the fact that we were able to place all the new shares and hence to complete our current refinancing on our own, has made many of our partners and outside observers sit up and take notice. “Investors shower money on Infineon”, “Infineon rids itself of debt – without financial investor”, “Infineon is ready for the consolidation of the semiconductor market” or “… Infineon saved” were the gist of the headlines and commentaries. Even though the CEO often takes the limelight in media coverage, I am well aware of how very much it is a “team achievement”.
Each one of you has made an individual contribution to restoring our investors’ trust: by reliable work performance in difficult times, by personal losses such as a temporary waiver of salary, or by your general willingness to accept change. This restored trust is essentially based on our having kept our promise. We delivered results, reliable results, we quickly generated a positive cash flow again and we topped that by a refinancing solution which has prompted favorable surprise. That inspires trust – new trust, of a kind we have not seen in previous years.
This is a great step for Infineon, a major foundation, a new beginning.
I wish to thank you once again for this, also on behalf of my fellow members of the Management Board. I am very proud of a workforce which has stuck together in the crisis and – as I am firmly convinced – will continue to do so. And I am proud of a management team which has dropped the practice of departmental debate often seen in the past and, after swiftly agreeing the target and how to reach it, acts with resolve and speed.
Confirmation of our strategic direction
During and after the All Hands Meetings, some question were raised and discussed which I’d like to re-address here. Turning first to our corporate strategy: The fact that we are able to achieve many new design wins and project successes even in the midst of the financial and economic crisis confirms to us that we are strategically very well positioned with our present business. We are focused on what will be our four remaining segments: automotive electronics, industrial applications, chip cards and security solutions, and mobile communications. Looking ahead, they all hold promising growth potential for us, and we aspire to a leading role and primarily organic growth in all four areas. Where acquisitions prove to make sense after having weighed up the competitive behavior and the anticipated growth of results and value, they can now be targeted. We now again have the financial resources for such a move, even if within limits. However possible M&A activities are not the focal issue. We will not go on a “spending spree” but will set our sights on how we can reliably increase the value of our company.
In some way the prerequisites for the further development of our business were never better than at present: We are focused on the global growth markets of energy efficiency, security and communications which are of the utmost relevance to society, we possess or are working towards the necessary technology and market leadership, we have a strong customer base and with IFX10+ a greatly improved cost position. Due to the recent refinancing measures, our cash in hand and our liabilities have been restored to a healthy balance. Our prime goal is to significantly increase Infineon’s profitability and to make our company one of the best in our industry on a sustained basis, i.e. across market cycles. We will now continue to push ahead with achieving this. We cannot and must not rest content with operationally just about reaching profit territory; the cyclical nature of our business demands a sound, double-digit profit margin.
Continuation of our cash and cost discipline
Some members of staff asked why we are still exercising strict cost discipline and have to continue IFX10+, given the successfully placed rights issue. The subject arose partly in connection with the question of the necessity of continuing short-time work and unpaid leave.
To begin with, regarding the fact that after implementation of all the refinancing measures, including the closing of the WLC sale, we will have over one and a half billion in cash available: It does not mean that we now have a billion on the account “to play with” for every conceivable purpose. Even though we wish to finance our business and our investments from operations, we are badly in need of these liquid funds: We have to pay back our debts and we have to be prepared for possible risks, for instance from the Qimonda insolvency. We seek to have the financial strength to remain capable of acting in any market situation. As communicated, the market outlook for the future is uncertain. Therefore none of this is a luxury, but a normal part of sound financial and business management.
It means we are not in a phase in which there’d be anything to share out or where we could ease up on our cost-cutting measures. I request that, for instance, our decision concerning pay rises in the forthcoming STEPS round be understood in this light. We will indeed make the rises to which we are committed by law or by collective agreement. And in some countries, certain local adjustments to the respective economic environment (e.g. inflation) are also envisaged. However, pay increases as such cannot be made or, that is to say, it would be financially irresponsible to make them at present. We are currently looking very carefully into the question of extending short-time work and unpaid leave into the new financial year – on the one hand in order to cope with the increased workload. On the other hand, we cannot and must not take on all the projects that present themselves to us, and invest too heavily as a result. Every project entails not only payroll costs, but further down the road it also involves mask costs, investments etc. - its future return has to be carefully examined.
We must not make the mistake now of reverting to old ways in terms of cost as otherwise we would jeopardize the achievements made. In carrying out our capital increase we have made an “investor pledge” which we have to take very seriously.
Furthermore, we will have to get used to the idea that cost management is not a “crisis issue”, i.e. a program that is limited in time, but an enduring element of good management. In the crisis and in our IFX10+ program we have acted in a very goal-oriented and consistent way. At the forefront were a clear focus on profit, concentration on the essentials, the courage to take “tough decisions”, and the exemplary commitment and team spirit of the workforce. This attitude has to be preserved beyond the crisis and become embedded in our daily work. At some point the IFX10+ program and the “company-wide task force” I once mentioned will come to an end; but not the spirit and the aspirations tied to them. They must become a matter of habit for every one of us.
I wish you an enjoyable summer and vacation season and look forward to shaping the next phase of our company transformation together with you, on the route to sustained success and profit.
Kind regards,
Peter Bauer
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