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DKSH rigorously and successfully pursued its expansion strategy in 2008. Since the merger (union of the Asia business activities of Diethelm Keller and SiberHegner) in 2002, the Swiss group has developed from a traditional trading house into the leading provider in the sector of Market Expansion Services. "In every year since 2002, DKSH has reported new record results", says Joerg Wolle, CEO and President of DKSH, "We are all very proud of this outstanding performance, particularly against the backdrop of the most severe economic crisis in 80 years". For him, "The acid test for any business model comes in times of crisis. Our model has clearly demonstrated its viability. Asia Pacific continues to be the most promising growth market and we are benefiting from the growing outsourcing trends."

With the capital increase successfully completed at the end of April 2008 and the winning of new, high-caliber shareholders (Rainer-Marc Frey, FPP Group and Anova), DKSH has laid a solid foundation for further organic and acquisitional growth.

In addition to the takeover of the renowned Swiss trading house Desco von Schulthess, announced in April 2008, DKSH has made six further acquisitions over the past twelve months: two in Australia and one each in India, Scandinavia, Japan and China.

During the past year, some 80 million Swiss francs were invested in establishing new distribution centers and in upgrading existing ones. They are the linchpin for further market expansion. An additional 25 million Swiss francs were allocated for expanding the state-of-the-art IT infrastructure at the Corporate Shared Services Center (CSSC) in Malaysia. The focus was on the implementation of SAP throughout the entire group, whereby all DKSH business processes will be globally harmonized and standardized by the end of 2009.

All four Business Units - Consumer Goods, Healthcare and Pharma, Performance Materials and Technology - contributed to the corporate success of 2008.

In 2008, the Business Unit Consumer Goods succeeded in further expanding its leadership position in the market for fast moving consumer goods. It continues to be the strongest Business Unit within the group in terms of both net sales and revenues. 2008 was marked by a diversity of external challenges such as rising oil prices, the melamine scandal in China, the disastrous cyclone in Myanmar and persistent political instability in Thailand. Nonetheless, the Business Unit Consumer Goods succeeded in increasing its net turnover. High volumes and seamless market coverage via the comprehensive regional networks across Asia proved to be essential criteria for ensuring continued success.

The Business Unit Healthcare more than doubled its income in 2008. This significant growth in revenues can be primarily attributed to its dedicated positioning as being the only full-services provider in the healthcare and pharma sector able to offer the entire spectrum of services, ranging from marketing to distribution, up to and including logistics. Also bearing fruit is the ongoing expansion of our own highly specialized proprietary products. Following the takeover of the pharma wholesaler Shanghai Zhonge Kangda Medical, DKSH was able to decisively strengthen its operations in China.

Net sales and earnings of the Business Unit Performance Materials reached new record levels in 2008. Milestones were market entries into Brazil and Indonesia. Additional growth was also achieved through three acquisitions. Successfully integrated were the raw materials distribution business of the Desco Group, as well as the Dasico company in Scandinavia, and Voltas in India. Consequently, the Business Unit Performance Materials is now active throughout Europe and expanding its presence in India. Moreover, DKSH has also set up a center of competence for REACH - the new EU regulation on chemicals. In addition to its conventional marketing and distribution activities, the center is also offering registration services for chemicals, which many producers of chemicals require in order to export to Europe.

In addition to two acquisitions in Australia and Japan last year, the Business Unit Technology has focused on the further expansion of its services activities. Over and above the classic sales and marketing of products, emergency and repair services, overhauls and maintenance are increasingly emerging as a core segment. Moreover, the portfolio has been expanded to include products from the business sectors of renewable energies, photovoltaics and recycling. The joint ventures with US company Cummins in Thailand and Germany's Trumpf in China again exceeded all expectations.

Considering the extremely challenging global economic environment, DKSH has seen an excellent start to the 2009 business year. Nonetheless, reliable forecasts for the remainder of the year are difficult. The full extent of the effects of the tenuous economic situation is almost impossible to predict. The massive collapse in sales in the luxury goods, machinery and automotive industries, plus its inevitable consequences, is in stark contrast to the excellent equity base and broad diversification of the DKSH Group. DKSH assumes that the Business Sectors of Healthcare and Fast Moving Consumer Goods will remain stable, or even benefit somewhat from the current situation. DKSH Group will exploit the opportunities that offer themselves to a market leader in the prevailing environment. In the face of rising cost pressures, there is an increasing trend among many companies to outsource non-core activities such as product sales and distribution in the Asia markets to specialized service providers. Moreover, consolidation and restructuring pressures are generating promising takeover opportunities that will be more easily and economically acquired in the current business environment.

DKSH is presently assessing a string of potential acquisitions across various business sectors and markets. According to Joerg Wolle, CEO and President of DKSH, "This crisis is separating the wheat from the chaff". Companies will once again be obliged to focus increasingly on their core business, while DKSH is offering itself as an experienced partner for projects involving outsourcing of services. "Given our position as the market leader with a tried and tested management team, and a truly healthy balance sheet, we will secure a larger share of a somewhat declining overall market", says Joerg Wolle.

DKSH is the leading Market Expansion Services Group with focus on Asia. As the term "Market Expansion Services" suggests, DKSH helps other companies and brands to grow their business in new or existing markets.

With 460 business locations in 35 countries - 20 of them in Europe and the Americas - and 22,000 specialized staff it is one of the top 20 Swiss companies ranked by sales and employees. In 2008, DKSH generated annual gross revenues of CHF 8,400 million.

The company offers any combination of sourcing, marketing, sales, distribution and after-sales services. It provides business partners with expertise as well as on-the-ground logistics based on a comprehensive network of unique size and depth. Business activities are organized into four specialized Business Units that mirror DKSH fields of expertise: Consumer Goods, Healthcare, Performance Materials and Technology.

Although DKSH is a Swiss company with headquarters in Zurich, it is deeply rooted in communities all across Asia Pacific. This is because the company looks back on a more than 140-year-long tradition of doing business in and with the region.