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Introduction:
Georg Fischer (GF), based in Schaffhausen, Switzerland, is over 200 years old and is very well integrated in today’s economy. The company has over 125 branches located across the globe. It employs about 13,500 people, with around 2,500 of them in Switzerland.  GF focuses on three core areas of business: plastic and metal piping systems used for water, gas and raw material distribution; components and systems for the automotive industry; and high-precision molds and tool making (through its AgieCharmille division) for the telecommunications, automotive, aviation, and electrical manufacturing industries.  It is a global leader in the safe transport of liquids and gases, vehicle weight reduction, and high-precision manufacturing technologies. 

With the aim of becoming a leader in these three segments, the company is clearly pursuing a highly innovative R&D strategy in all three divisions. This strategy up until now has been a success and the company has developed most of its present businesses organically.The most important business division is the automotive section which accounts for about 45% of sales. The pipe system division accounts for approximately 35% of sales, and AgieCharmille accounts for 20% of sales. 

The automotive division produces highly stressable and weight-optimized cast parts, which are used for the chassis of cars and trucks. GF’s products are the industry standard. Only a short time ago the company signed-off on a CHF 400 million contract with the German car maker Audi, who wants to enter the top-end car market and therefore requires high-quality products, which Georg Fischer can produce easily. GF’s automotive business is heavily interconnected in the European car industry, but due to this, the division’s results are highly cyclical with about 89% of automotive sales depending on European based car companies. 

The less cyclical piping business offers connecting and linking systems, and measuring and controlling technology applications. Apart from traditional business exposure (to the industrial, building services and engineering industries) the division is seeking to expand into sectors such as hospital and healthcare infrastructure, as well as the mining industry. This division creates about 41% the sales in Europe.

Strengths and weaknesses analysis / Fundamental analysis:
Strengths:

• About 40% of earnings are distributed to the shareholders as dividends,- With the acquisition of Hakan-Plastik, the company is expanding its less cyclical piping business,
• In order to avoid a highly volatile equity capital situation, the company has switched to Swiss GAAP accounting standards,
• GF is committed to excelling in day-to-day business in order to achieve the long-term vision, 
• The company has a strong track-record in R&D

Weaknesses:

• The worldwide car industry currently has huge overcapacity, which will take some years to reduce. The automotive division will therefore remain a volatile element of the company,
• The less cyclical piping business has been reinforced at substantial cost. Given that most contracts are sponsored by governments and or their agents, the company’s sales are now exposed to potential government budget constraints,
• More than 90% of the sales are derived outside Switzerland. Therefore, the company is exposed to foreign exchange rate risks, 
• In order to achieve and maintain the best cost/production efficiency ratio, the company must constantly improve its production process. This could mean that some of production sites will need to be given up.