In 2020, everyone was confronted with unprecedented circumstances due to the pandemic. Naturally that also held for our own people. They were regularly required to quickly and effectively react with minimum preparation time. Our management throughout the world was often confronted by entirely new challenges. We are impressed by the resolve of our managers and the adequacy and effectiveness of the measures taken. Our employees delivered admirable performance under entirely different working conditions, with changes and uncertainties. The lockdowns and measures often also affected the home situation and there, too, created concern and uncertainty. In spite of these circumstances, everyone displayed tremendous dedication and put in tremendous effort.

The lockdowns and the decrease in demand prompted a large number of measures to be taken to ensure the company’s continuity. One key measure concerned stock management. As soon as it became clear that the decrease in demand was significant, we implemented certain measures and adjusted our global procurement schedules with the objective of decreasing total stock levels in line with lower volume projections. At the same time we took steps to ensure that the breadth of our portfolio stayed up to par. This enabled us to maintain our market service levels and to continue to meet the agreements made with many contract customers in terms of the availability of materials. With the expert efforts of our stock and procurement managers, supported by our advanced stock planning systems, we succeeded in significantly reducing our worldwide stocks over the course of the year. At year-end 2020, the stock level was below 175,000 tons, in line with the objective as set.

To be able to further deal with the decrease in sales as a result of the lockdown, we implemented various measures designed to reduce costs. In addition to many minor savings, in part due to reduced costs as a result of the lockdown (such as travel costs), lower personnel expenses formed the largest part of the cost reductions. A number of reorganizations were implemented that resulted in a reduction in the number of staff in various countries and in different branches.

The production site for automotive customers in Pusté Ú─żany, Slovakia, was reorganized and the stock-keeping site in Vienna, Austria, was converted into a sales office and logistics was integrated into the stock-keeping location in Germany. We moved the warehouse in Ostrava to Vyškov in the Czech Republic, our central location for Central Europe, and the activities of Combulex in Vianen in the Netherlands have been moved to the central warehouse in Zwijndrecht, the Netherlands. Through various measures, the workforce was reduced by 200 to 2,419 employees at year-end 2020.

Aside from a reduction in the number of employees, personnel expenses were also significantly reduced by means of voluntary temporary salary reductions, reduced working hours in many countries and similar arrangements. In a few countries we made use of government support measures. We very much appreciated the solidarity among employees in various branches and their willingness to contribute to the continuity of the company through means of salary sacrifices.

Another part of the cost reduction came from the discount we received on our real estate rentals. At various locations, lessors were prepared to give us a one-off discount on our rent. Especially the real estate rent reductions in the Netherlands resulted in a substantial cost reduction.

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