MANAGEMENT REPORT banks by DKK 0.3bn. The Group's interestbearing net deposits now amount to DKK 2.8bn as against DKK 2.2bn at the beginning of the year. Our equity ratio has improved from 59.9 per cent to 63.3 per cent. Cash flow from operations amounts to DKK 2.2bn. Continued research and technology development As tradition has it, we invest the majority of our profits in the continued development of Grundfos as a technology leader and a healthy and sound company. We note with satisfaction that an increasing number of our competitors are now beginning to give priority to energy efficiency and sustainability. This strengthens the awareness of this major challenge in the market, leading to healthy competition developing the most environmentally friendly solutions. We maintain our ambition of being ahead of everybody else in our product development, and we continue to make substantial investments in research and technology development. In 2011, we invested more than 5 per cent of our turnover in research and development, and many new solutions will contribute to us being able to maintain our strong market position and win new market shares. In 2012, we plan to present a number of high-technology, user-friendly and energy-efficient products that will give us a strong position and renew the entire business in a number of areas. Values must be acted out During the past year, we presented our revitalised values to all employees. We have been a value-based company for many years, and our values represent both our history and our future. They must be a practical tool and must be acted out every day by every single employee. Our values are a tool that helps us focus on being the company that we would like to be and which our customers and business partners expect us to be. The values will only have this effect if all employees consider them to be relevant and if they make sense in relation to everyday activities. For one day, all 17,600 employees all over the world engaged with great enthusiasm in discussions about what the values mean and should mean to us. This way, we made sure that the values are relevant and up-to-date and that Grundfos is not just a place where we are working but an assignment that we are working on. We now act out our revitalised values in our everyday activities – sustainable, open and trustworthy, people in focus, independent, partnership and relentlessly ambitious. Relentlessly ambitious The latter value has just been formulated, but it very much characterises what created Grundfos. A relentless effort to constantly seek to do everything even better and create even greater value for our customers and end users. This must translate into continued growth, and many great growth opportunities lie ahead of us. In 2011, for example, we opened a global competence centre within the utility area which is to assist our many companies in gaining an even firmer foothold within wastewater and water supply. In 2012, we will initiate a large-scale launch of new products that will set new standards and cement our position as market leader. It is against this background, among other things, that – despite the European debt crisis – we expect to achieve progress and satisfactory growth in the coming year. Group expectations for 2012 include an increase in turnover of approx. 7 per cent. We plan to continue the high level of activity in all parts of the organisation, and 2012 will also see the involvement in a number of strategic projects that, in the short term, will lead to higher costs. Performance is not expected to improve in 2012, however we expect a performance level similar to that of 2011 or slightly lower. Carsten Bjerg, Group President Lars Kolind, Group Chairman For 2011, in connection with the publication of our annual report, we have decided to publish an annual statement that informs about the most significant events in the Grundfos Group. The annual statement may be ordered from all company offices or from the web site www.grundfos.com/reports. 6 | GRouP AnnuAl RePoRT 2011
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