jensen-group quarterly review · to our economic drivers and supports our strategy to make our...

JENSEN AG Burgdorf www.jensen-group.com

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JENSEN-GROUP

Quarterly Review

No. 6

Date May 22, 2013

Dear JENSEN-GROUP staff member,

We are looking back at an excellent year 2012 as well as a good 1st quarter 2013. If only this

would continue ! Unfortunately there is always a bump on the road that we need to pass or avoid.

Currently, our order intake is lower than we want it to be, however, we are expecting some large

projects in the near future. There are always new challenges we need to master. Luckily we have a

clear strategy and nothing will divert our efforts in respect to alignment, process and discipline.

One of our projects is to define our Build to Order BTO and Engineered to Order ETO products. One

of our future tools will be the JPP 2.0. In order to understand the difference, we have this simple

definition:

BTO:

Covers products which have clear specifications and options which are listed in our JPP 2.0.

BTO products have known specs, known cost and known time to produce.

ETO:

Covers products and options which are not priced in our JPP 2.0 and which need to be

addressed by our engineering department before being produced. Very often a functional

description is required. The price for the machine or option is on request.

We have the resources to handle both BTO and ETO products and our objective is to make sure

that we have the systems and processes in place in order to be able to qualify all our products,

which are sold in higher volumes, as BTO products.

The advantage of BTO is that we know our contribution margin when the machine or system is

sold. Normally "no surprises" equals a happy customer and a quick start-up. ETO/BTO contributes

to our economic drivers and supports our strategy to make our equipment plug and play.



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We will be implementing JPP 2.0 this year and already thank you for embracing the implementation

and making sure this project will be a success for the JENSEN-GROUP.

With best regards,

Jesper Munch Jensen

CEO

Financial Results

Figures 2012 and 2013/Q1 ResultsCopytext News

We reported for 2012 record high revenues of 229.9 Million Euro compared to last

year's revenue of 216.2 Million Euro. Thanks to the high activity level and

improved cost control on large projects, profitability increased as well. The order

backlog decreased during 2012 in various markets.

The revenue in the first quarter of 2013 was 58.9 million euro, which is 0.8%

lower as compared to the same period in 2012. The order backlog at the end of

March 2013 was 15.9% lower than at the end of March 2012. However, we

expect a first half-year result to be similar to that of last year. We remain prudent

as the economic uncertainty affects the investment climate and consequently our

order intake and sales. The most important risk factors remain rapid changes in

demand, high exchange rate volatility and fluctuating raw material, energy and

transport prices.

Annual Report 2012Copytext News

The Annual Report 2012 is available on the website: http://www.jensen-

group.com/flip/Annual_Report_2012. As we take our share in the environmental

responsibility, we decided to publish the 2012 Annual Report in a fully digital

format for the first time. We expect the electronic-only distribution to save

thousands of Euros yet make the report’s facts and financial data more easily

accessible to more people. We hope that all our stakeholders will appreciate our

efforts in saving our precious resources and we hope that they will enjoy reading

our Annual Report regardless from their location.



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News by Business Units

BU WT: Business Unit Washroom Technology

JENSEN Germany, Harsum

The design work for the new dryer family is nearly finished. The first WR60

prototypes are delivered and installed in a Swiss laundry in Q1. The machines are

optionally equipped with a fully integrated heat exchanger, hence no external

Recocross. After performance evaluation, we will inform about market availability

in due time.

JEDE has reactivated the "Lean Product Program" to further streamline the JPP

and options. The goal is to increase the number of BTO machines. More options

and ETO products are further available upon request.

JENSEN USA, Panama City

Our Futurail helpdesk in Europe is now fully functional and providing software and

support to many European projects. The new Futurail .NET software is now being

used on all new systems and all JEUS software engineers have been trained and

are now fully experienced.

BU FT: Business Unit Finishing Technology

JENSEN Denmark, Rønne

2012 has been a challenging and very busy year: our turnover in finishing

technology grew substantially, our new plant in China started with full production,

and the production of the Jenfold Tematic towel folders, the Jenfold Butterfly Fox

garment folders and the Jenform tunnel finisher from our Swiss facility was

moved to Denmark. The result is more than satisfactory.

In spite of these busy times with more business, we are pleased that the transfer

from JECH was completed faster and with less transfer cost than calculated in the

business plan, a result of the big efforts by our colleagues in JEDK and JECH.



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The "Butterflies" are now part of the

daily picture in the plant.

A new exciting Jenrail feeding station concept to facilitate the operators working

conditions was approved by the first customer Van der Kleij in The Netherlands.

The first installation will be in June, we will keep you informed when in operation.

This is a follow up from the big attention our different Jenrail concept presented

at the Frankfurt Texcare Exhibition in May 2012.

A magnet at Texcare, a smash hit for

laundries looking for automated

solutions: Jenrail

In order to enable sales people to make preliminary sales layouts themselves, a

project called "simple layout blocks" is being started up. The idea is to make

simple layout blocks available for our SSC's. These blocks will be generated

automatically from the advanced blocks we are using for the final layouts. "Your

Performance in Mind" is valid for our engagement towards our customers, but

also from the PEC towards the SCC!



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The Danish Minister for European Affairs Nicolai Wammen visited JENSEN

Denmark in November. The visit at JENSEN was part of a round trip to successful

companies to investigate if there are any connections between the different

causes to the success, and also to listen to proposals to improvements for the

companies' environment.

Morten Rask, Manager Production &

Engineering, guides Nicolai Wammen

around our factories in Rønne.

JENSEN China - FFT

In its first year of operation, our plant in Xuzhou achieved the goal in our

business plan to produce an ironer per week of the usual high JENSEN quality and

not less important: our SSC China managed to sell them as well. This is a

precision landing, and a great achievement for the entire team at JENSEN China

and the colleagues from JENSEN Denmark that have been supporting in the set-

up of the plant.

News by Business Regions

BRI Business Region I – Western Europe and Mediterranean Countries

France

JENSEN France can be considered as the miniature version of the JENSEN-

GROUP: Our SSC reported a record year with respect to turnover and operational

profit. This high turnover is linked to the commercial successes from the past two

years. Unfortunately, our skyride will come to a break: There are less big projects

of the size that we have been installing in the past. Luckily we do have several

medium size projects for delivery in 2013, plus interesting projects with some of

our key accounts.



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Looking back to two busy years, and

looking forward to a new year with

many exciting projects: the project

and layout department at JENSEN

France.

South Europe

Our business on the Iberian Peninsula, in Greece and Cyprus is catching up. The

economic situation seems to be clarified, and some projects are starting again.

Turkey

A new law forces hospital and nursing homes to process all linen in a heavy-duty

laundry. Until now, all staff took their work clothes home and washed them at

home. This is no longer allowed, which opens up new opportunities for JENSEN.

Together with our partner Tolon, we have created a marketing campaign to

convince hospital managers that JENSEN machines and solutions are the best

vitamines for their operations.

Italy

2012 has been a transition year for the Italian economy and society, with a brutal

stop in healthcare expenses. Investments have been halted, and private

customers find it difficult to get loans from their bank. This difficult situation leads

us to downsize the organization to adapt to these new market conditions.

Nevertheless, we are negotiating quite some interesting projects, and we are

about to install the first Metricon conveyor designed to sort automatically

personal clothes of retirement home people, which would be the first one in Italy,

and seems to be a very promising market in our countries.



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BRII Business Region II – Northern, Eastern and Central Europe

Benelux

We are pleased to announce record high revenues for the Benelux in 2012,

thanks to a number of large projects in Belgium and The Netherlands. Our sales

team has recently been "rejuvenated", and we had many personnel changes.

Bernard Vermeiren, Ton Van Gool and Freddy Lampaert retired and were replaced

by two new sales managers - Geert Braeckman and Ilja Buunk - as well as a

service manager, Marc Janssens. We feel a good team spirit in both our offices,

which will also result in a positive business development.

Sweden

The activity in the market has improved in a very positive direction in Q4. The

number of projects is increasing, however, the price pressure remains very fierce.

Also in Sweden, we are very successful with our service contracts. We remain

cautious, and have already reduced our office space at our premises close to

Stockholm in order to save cost.

One of the latest laundries that have

been equipped with JENSEN equipment

processes floor mats that are used at

the entrance of shops and offices.

Certainly an asset in the long and cold

Swedish winter!

Switzerland

Thanks to a.o. the project KSB Baden (Cantonal Hospital Baden - see last

Quarterly Review), JENSEN Switzerland reports a high order intake. The closing of

the factory in Burgdorf is history, and we are working at the re-organization of

the "new" SSC. The service activities are picking up again. We strongly pushed

the selling of inspection contracts and maintenance contracts, which was quite

successful.



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With a maintenance contract, we offer to have one of our engineers in the

laundry on a weekly base, so the laundry can replace or reduce their technical

staff. Such a contract enables the laundry to get professional maintenance

without adding overhead costs. This type of contract is very flexible and adapted

to the customers' needs.

One of the many laundries that are

visited weekly by a JENSEN engineer is

located in the Hotel Palace in St.Moritz,

a renowned 5 star hotel with

breathtaking views.

Germany

Harald Thiele has been appointed Sales & Service Manager at JENSEN GmbH,

Germany. Harald is a familiar face to the JENSEN organization, as he has worked

for both Senking and JENSEN during many years. After five years at Ecolab, a

supplier of detergents within our value chain, he has now come back to JENSEN

in order to assume a managerial position. Meanwhile, Harald had a great start in

his new job as SSC manager with great acceptance by our customers and

employees, and he is well on track with order intake and revenue.

Eastern Europe/CIS

The activity level in Poland and Czech Republic/Slovakia is getting back. We are

working on several new projects that look very promising. Thanks to our local

presence - we have offices in Lodz and close to Ostrava and the border to

Slovakia respectively - our JENSEN sales managers have strong relationships with

the local laundries.

United Kingdom

The UK industry is still fighting a price war, and we expect that the market will be

subdued this year due to the economic climate. Some of our customers are

running their plants on longer shifts, and other small groups are reducing textile

purchase which means that they are really feeling the impact of lower prices.



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South Africa

The activity is very high at the moment: our distributor LEAD is very proactive

and pushes every possible sale.

BRIII Business Region III – Australia, Asia and Arab Peninsula

Asia

We are quite optimistic and see good and increasing activity in most countries

covered in Asia. The competition is getting more aggressive, but we still believe

that we are in a good position to maintain and even increase our market share.

JENSEN has become the top-of-mind supplier in Asia, and the benchmark within

the industry. By the end of 2012, there were more than 3 million hotel rooms and

suites in the Asian-Pacific Region.

JENSEN is ready to offer the perfect hospitality program to this growing market -

with an extensive performance program, and a strong network of SSC and

distributors. Each country however has a different economy, "investment mood"

and legislations. In Malaysia for instance, we eagerly await the elections in April

2013. By then, we will know how the healthcare concessions will develop. In

Singapore, the government subsidizes laundries when integrating automation -

which is very positive for us.

We recently installed the first JENSEN tunnel washer in India: The laundry of

Indian Railways processes the linen for luxury and express trains travelling this

vast country. Every passenger is given a linen kit comprising of two bed sheets,

one pillow, one pillow cover, one face towel and one blanket. In addition, a bath

towel is also given to passengers travelling first class.

The entire linen kit except the blanket is washed in daily, whereas the blanket is

dry cleaned monthly and sanitized every fortnightly. The laundry supplies many

thousands of linen kits per day to the passengers.



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A passenger suite on the Royal

Rajasthan on Wheels, one of the many

luxury trains owned by Indian

Railways.

Another première was recorded in Sri Lanka. In spite of quite a large population

of 20 million people, Sri Lanka is not yet a big market for us. Economy is

recovering now that the civil war has come to an end. We are delivering our first

ironer and folder to exclusive Cinnamon Grand Hotel. This will be a challenging

job with re-building machines on site because of tight access, but this is the only

way a number of existing hotels can upgrade. We have in some recent jobs

proven that we can be successful in doing this.

Australia

JENSEN Australia is getting ready for one of their largest projects ever: a new

turnkey laundry at Cabrini Linen. Located in the greater Melbourne area, Cabrini

produces more than 120 tonnes of linen per week for Cabrini - a conglomerate of

hospitals, a palliative care center as well as residential aged care home and

rehabilitation services. The new building is currently under construction and

equipment installation will start from June. Complete plant including Sorting,

Classified rail, 2 x CTW systems, 5 ironer lines and dry-fold – gas heated dryers

and ironers.

China

The market developments and the number of installations have encouraged us to

strengthen our SSC in Shanghai with additional personnel. The growing team,

headed by Thomas Yin, has now also moved to new and larger premises and is

focusing on the development of the LMT, the management of our distribution

network and gaining even higher market share. The trend with commercial

laundries being more active and professional is continuing. We are in an excellent

position thanks to our vast offering of automation solutions.



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A big success was recorded at a new laundry being built by one of our existing

customers in Nanjing: In addition to a JENSEN tunnel washer and two JENSEN

ironer lines, also the first larger Futurail Classified in China will be installed.

BRIV Business Region IV – Americas

The total turnover for 2012 was substantially above budget, and the sales activity

is still strong in all areas of our business. We acquired large orders both in

Canada and the USA.

Canada

In Canada, K-Bro is the largest provider of laundry and linen services for

healthcare, hospitality and other commercial sectors. With large processing

facilities in Quebec City, Montreal, Toronto, Edmonton, Calgary, Vancouver and

Victoria, K-Bro employs over 1600 people. Their order for its new healthcare plant

in Edmonton is the largest ever received by JENSEN USA and the JENSEN-GROUP.

In December, we also received a large order for finishing equipment for K-Bro's

laundries in Toronto, Vancouver and Victoria.

USA

Hospital Central Services Association (HCSA) plans to open its new laundry in

Auburn, not far from Seattle. When the business opens in 2013, the 144,357-

square-foot (13,400 sq.m.) is expected to employ up to 165 people to launder

the region's hospitals' laundry. HCSA already operates a large institutional

laundry near Seattle University that provides services to 11 hospitals in Seattle.

That plant, which moves to Auburn, processes 20 million pounds of laundry per

year and operates 14 hours per day, 364 days per year. Linens such as sheets,

towels, and surgical scrubs are cleaned at the laundry. HSCA is a coalition of six

hospitals that serves itself and seven others. The consortium processes some 2.6

million pounds of linen per year only for Virginia Mason Medical Center, a 20

percent owner.

Latin America

Laundries in South America are eager to catch up on the automation side: We

recently installed some Metricon systems, and are very positive about large

projects.



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Parts and Service

We are continuing to build up after-sales support capability. In 2012, a team of

19 field engineers carried out around 100 planned service visits that generated

roughly 50% of the total service revenue, excluding machine installations. They

also held five service training schools for customers which were well attended and

very appreciated by our customers.

Tune in to JENSEN: When you turn on

the radio, you expect that your

favorite channel broadcasts every day

on the same frequency. Customers can

count on that with our JENSEN service

programs. We have been highlighting

this advantage of working with JENSEN

in a recent marketing campaign, and

confirmed it in all of our SSC.

Development of the JENSEN USA spare parts website is ongoing and now

accounts for 30% of total spare parts sales. We are continuing to develop our

parts stocking criteria and in 2012 over 85% of the parts ordered were in stock

and could, if required, be shipped the same day.

News from Corporate

IT Tools for more alignment within the JENSEN-GROUP

New JPP 2.0

We are launching a new sales quotation tool which will enable our sales

organizations to

. Produce clear and uniform quotations faster and with less effort;

. Guarantee error-free configurations and quotations;

. Respond quicker to demands from the market;

And which will support our company to grow in a profitable way.



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The JPP 2.0 is one important step on our way from good to great, and it is also

the first project of this kind that will be implemented in all our organizations.

The concept of this new tool can be compared with the configurators that you

may know from the car manufacturers: Anyone who has already pre-configured a

new car online knows the benefits of such an easy, trouble-free and efficient tool.

More details about the new JPP 2.0 were disclosed in a dedicated e-learning

session to our sales and marketing staff. At the moment, the teams at the PEC

are working hard to convert all existing texts into the new system. The

Acceptance Team is already "challenging" the tool and its implementation.

JENSEN UK will be the first SSC to work with the new JPP 2.0, and we will report

on project milestones in the next Quarterly Review. For immediate questions and

comments, please write to [email protected].

New tools being rolled out

Wireless Internet is now available in all our European SSC, making life much

easier for customers and colleagues visiting the offices. In average, more than 80

persons use the wireless internet - and that is the count per day!

The welcome to visitors has also been professionalized at many JENSEN locations

with a uniformed welcome screen, displaying the names of the visiting guests and

the possibility to add local news.

The Welcome Screen at JENSEN

France, pictured with Marie-Noëlle

Pellet.



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We are expanding the existing contracts with our IT outsourcing partners to make

sure that all JENSEN entities get better corporate IT services. We foresee that the

improved performance and higher availability of the Blackberry-, Exchange- and

the Axapta Access servers will be a great support in your daily work.

Both JECH and JEGR in Burgdorf are fully operational with Lync, a communication

tool from Microsoft that replaces existing switchboard systems, instant messaging

and eventually also WebEx. Thanks to the consequent use of Lync, our costs for

mobile phone calls and roaming have been substantially reduced - by up to 70%!

We already started projects with individual SSC to replace their existing

switchboard system with Lync. The feedbacks so far are very positive, especially

because Lync helps people to interact in a more efficient way.

Communication - Notes from the editor

Some of the stories in this Quarterly Review refer to earlier periods. Because of

customer confidentiality, we cannot always report directly on the spot. We hope

that you still enjoy reading this Quarterly Review. Contributions or comments

from you are - as always - very welcome.

May 22, 2013 / Corp. Communications



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People & Positions

Time period: September 2012 - April 2013

New colleagues Name Function Unit

Calvin Hart Service Engineer JENSEN Australia

Bal Lamsal Financial Accountant JENSEN Australia

Linh Nguyen Service Engineer JENSEN Australia

Ravi Sharma Finance Manager JENSEN Australia

Dominic Weibel Service Engineer JENSEN Australia

Nathan Williams Sales Support JENSEN Australia

Wim Quisthoudt Project Engineer JENSEN Benelux

Dennis Van Empelen Service Engineer JENSEN Benelux

Rinus Verbeke Service Engineer JENSEN Benelux

Danny Liu Service Engineer JENSEN China

Frank Wang Service Engineer JENSEN China

Steven Wang Service Engineer JENSEN China

Bente Asmussen Engineer JENSEN Denmark

Heidi Bjerregaard Production Assistant JENSEN Denmark

Mikkel Due Trainee JENSEN Denmark

Kevin Frost Production Assistant JENSEN Denmark

Kathja M. Hansen Quality Assistant JENSEN Denmark

Frank M. Pedersen Technical Purchaser JENSEN Denmark

Rüdiger Ackermann Service Engineer JENSEN Germany

Kerstin Crome-Schramm Graphic Artist JENSEN Germany

Tobias Göhring Mechanical Production JENSEN Germany

David Hackenberg Electrician JENSEN Germany

Mario Hartmann Sales Support/Proj. Engineering JENSEN Germany

Carola Hinz Order Handling JENSEN Germany

Wladimir Leinweber Mechanical Production JENSEN Germany

Linda Mai Service Administration JENSEN Germany

Christian Petschel Sales Manager JENSEN Germany

Andreas Rau Mechanical Production JENSEN Germany

Matthias Sonnemeier Service Engineer JENSEN Germany

Harald Thiele SSC Manager JENSEN Germany



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Benjamin Walter Electrical Production JENSEN Germany

Steven Wehmeier Mechanical Production JENSEN Germany

Alexander Weilert Engineering & Prod.Development JENSEN Germany

Rikard Jensen Service Engineer JENSEN SIPANO (Sweden)

Daniel Arn Service Support JENSEN Switzerland

Gerhard Kohler Service/Spare Parts JENSEN Switzerland

Stefan Tschabold Service Engineer JENSEN Switzerland

George Page Apprentice Engineer JENSEN UK

Ali Scott Apprentice Engineer JENSEN UK

John Michalik Parts Analyst JENSEN USA

Kenneth Murphy Buyer/Planner JENSEN USA

Leah Steinbrecher Administration JENSEN USA

Chris Whittle Systems Design Engineer JENSEN USA

Relocations Name Function Unit

Dennis Lenos Service Engineer JENSEN Australia

Loris Fazzari Service Engineer JENSEN Switzerland

Martin Wölzmüller Service Support JENSEN Switzerland

New assignments Marcus Borne Engineering & Prod. Development JENSEN Germany

Roland Bosch Service Engineer JENSEN Germany

Michael Nasdala Technical Tendering JENSEN Germany

Jesse Dickon Electrical Engineer JENSEN USA

James Thorpe VP Sales & Marketing PEC JENSEN USA

We wish all new colleagues and all colleagues with a new assignment a great career within the

JENSEN-GROUP, lots of success and personal satisfaction.

Sincere thanks to all JENSEN Business Regions and Business Units for their input to the Quarterly

Review. It has become a long piece of reading material, and we hope that you will enjoy reading it.

JENSEN-GROUP/Corp. Communications

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