Solid growth in the BRIC countries clear the accounts of two of Denmark´s major industrial groups
Both Danfoss and Grundfos increase the revenue significantly in emerging markets. The sale has in several of the countries increased by double-digit growth rates. It compensates for a sustained drop in demand in Europe, and to a lesser extent in the United States, the two of which remain the most important markets .
“We get 20 percent of our revenue in the BRIC countries. This is the largest percentage ever, and it will grow further in the coming years. Our long-term strategy to focus on these emerging markets pays off, and it is close to make up for the decline in the traditional markets”, says Niels B. Christiansen, CEO of Danfoss.
At Grundfos, sales grew in both China and Russia by 12 percent in the first six months. And both places are expected to show growth: “In Russia we have for many years had high growth, and it continues. China is also a market with rapid growth. Things succeed more and more for us there”, concludes Carsten Bjerg.
For Danfoss, Brazil and Russia are the major growth engines. In Brazil the sales in the first half of 2013 increased by 32 percent, and the prosperity is spread across all business areas. Russia had in the first six months an increase of 19 percent. Danfoss has for a long period seen a double-digit growth in the Russian market.
“Russia is now our largest market for the heating business. There is great demand for district heating solutions in large parts of the country”, notes Niels B. Christiansen.
Russia makes major investments in energy-efficient solutions. The funding comes mainly from revenues from oil and gas, and this will continue for many years to come. “The need is big, because Russia has hundreds of thousands of homes in areas where in the winter it is not unusual with temperatures below 30 degrees below zero”.
China is again developing positive for Danfoss with an increase in sales of 6 percent. The increase comes after several quarters of declining revenue, because the Chinese establishment turned down the investment in construction and infrastructure in order to prevent an overheating of the economy .