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ePaper created 2015-05-06, 08:22:31 | version 1.38.0
37HERAEUS | FINANCIAL REPORT 2014 | GROUP MANAGEMENT REPORT As with currency risk, the management of interest-rate risk is completely centralized at Group level. With regard to the management of liquidity risk, the committed syndicated credit facility of Heraeus Holding GmbH was refinanced ahead of schedule in 2013. Liquidity risks are regularly simulated and subjected to stress tests as part of regular reporting and Financial Risk Committee activities. Com- pliance with the parameters needed to maintain the current rating is constantly monitored. For a more in-depth analysis of the financial risks see notes (38) to (42) of the notes to the consolidated finan- cial statements. Operational opportunities and risks Heraeus continually strives to make product and process optimizations that offer additional earnings potential across all of its business groups. The Quartz Glass business group, for example, is gearing up for further growth in a fast- paced market by making intensive efforts to optimize its processes. Its improved cost structures and new product generations are aimed at bolstering competitiveness. Changes to the cost structure are also opening up new opportunities in the Materials Technology business group. In the Sensors business group, too, the restructuring and integration measures have streamlined organizational structures and thereby freed up resources for further enhancement of profitability. Other opportunities arise from fluctuations in precious metal prices and currencies. Both an increase in the gold price and a US dollar that continues to be strong could lead to improved margins in the Precious Metals and Materials Technology business groups. The Group’s highly diversified business portfolio exposes it to general risks involved in the management of technical and business processes. The founding of new facilities and numerous acquisitions have created an IT landscape that is highly heterogeneous. In the coming years, the resultant risks will be reduced to the commercially unavoidable minimum through a process of ongoing standardization and the introduction of profes- sional IT systems. In 2014, the company made further progress in its large- scale project aimed at modernizing and harmonizing structures and processes: the Magellan program, launched at the end of 2011, aims to harmonize all the worldwide business processes based on a standardized IT platform. The first sites have already been successfully migrated to the new system. This program is the largest single project within the ongoing change processes due to its imple- mentation over a period of several years and the amount of resources it is planned to use. Risks relating to quality defects in production and order execution, to the loss of key personnel, and to threats to data security cannot be completely ruled out. Heraeus mitigates these risks by making continuous improvements to the quality management system, by pro- viding extensive training to employees, and by ensuring the latest and most reliable IT security programs are in use around the world. For example, systems to ensure the security of precious metals are integrated into a data and monitoring network that also enables IT-supported track- ing of efficiency in the respective production processes while supplying important pointers for their optimization. Despite these comprehensive measures, risks arising from the physical loss of precious metals cannot be completely ruled out.