Server: Microsoft-IIS/3.0 Date: Thu, 18 Dec 1997 01:43:10 GMT Content-Type: text/html Accept-Ranges: bytes Last-Modified: Tue, 01 Jul 1997 13:21:06 GMT Content-Length: 10668
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To Our Shareholders and Employees: |
![]() Record sales primarily reflected the acquisition of Anderson Industries early in the second quarter; our major markets were flat in 1996. But record profit resulted from increased efficiency in all our operations as well as the acquisition. It is gratifying that the relentless effort by all the men and women of Excel was rewarded so well. Sales rose 49% to $888 million, and about $285 million of the increase is attributable to the acquisition. Net income and per-share earnings rose 18% although two one-time items had lifted 1995 profit by 22¢ per share. On an operational basis without those items, net income and per-share earnings climbed 38% to $1.79 in 1996. Continuing Growth Path Excel achieved a leadership role in automotive window systems by internal growth and acquisition. In doing so, we built an innovative R&D, design, and engineering team. The acquisition of businesses or product lines with similar dynamics enables us to leverage these essential support capabilities over higher volume. The acquisition of Anderson Industries played an important role in last year's growth. Anderson was a private holding company whose main asset was Atwood Industries. Like Excel, Atwood had served the OEM market for many years, achieving a leadership role particularly in manual seat track systems and in door hinges. It also owned the leading recreational vehicle and appliance and hardware supplier, and a plastics injection molding company. It clearly matched Excel in processes, technology and markets. We found, for example, that the processes for seat track systems largely overlap those of window regulators. Atwood offered Excel better customer balance and a broader product spectrum. With similar manufacturing processes, it also clearly provided a way to leverage the support activities we have built to remain in the first tier of automotive suppliers. What Excel brought to the table was strong management, market recognition, commitment to continuous improvement and total quality, financial soundness, and focus on customer satisfaction. Integrating Atwood Upon acquiring Atwood, we promptly merged it within the SBU structure. The automotive business fit neatly within our automotive systems unit; Mark I complemented Nyloncraft so it was folded into the plastic products unit. Atwood Mobile Products became Excel's fourth SBU because it's distribution channels differ from that of our traditional RV niche, and it's growth strategies are well-managed. In the last nine months of 1996, we moved veteran Excel managers into the Atwood automotive operations and began to apply value management and kaizen processes that have been so effective in Excel's traditional business. We carefully assessed capacity against foreseeable requirements because we had to assure support for customers' plans without paying for costly unused resources. Only a week ago, we made a preliminary decision to close the Atwood Eddy Avenue plant in Rockford, Illinois by July 31. Operating at only 20% of capacity, this plant would require a disproportionate investment to reach world-class standards. When the decision is finalized, we will phase out operations in an orderly manner. this action, affecting some 300 employees, does not eliminate overcapacity but we have not decided yet whether to close or consolidate other facilities. Inside and World-Wide Internal development has not slowed. We have introduced to North America a world-class roll-formed door frame technology that is receiving excellent acceptance. It is one of our most important current launches for General Motors. We have also developed a modular door cartridge that several customers are evaluating. Navistar chose Excel as systems integrator and full-service supplier for a truck door program that has now been canceled. We have moved swiftly as well to prototype new seat track systems that will elevate Atwood's market leadership in that business. Excel has also improved its stance for global competition. In 1996, many of our automotive plants achieved QS-9000 certification, the new world-wide automotive quality standard. Most others will complete the requirements this year. New business alliances in Europe, India and South America, as well as our automotive plant in Mexico, bolstered our world wide commitment. Preparing for the Future Attention to customers' needs at every level is enhanced by our vision of total quality, competitive cost, and reliable delivery and support. We have accepted the dynamic change in our markets and developed and redeveloped processes and standards that enable us to compete successfully. Everyone in Excel is learning to understand that continuous improvement is always an uncompleted mission. We will continue to pursue those strategies that have successfully propelled Excel's growth in the past: continuous improvement, complementary acquisition and increasing globalization. As a mark of confidence in our ability to sustain profitable growth, the board of directors raised the regular cash dividend to shareholders 14 percent in the final quarter of 1996. I salute our employees - twice as many of you as there were last year - for the effort each has contributed to our growth and corporate health. Thank you! Sincerely,
February 20, 1997 |
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