Profile: Steinway Musical Instruments Inc (LVB.N)

Steinway Musical Instruments, Inc., incorporated in 1993, through its wholly owned subsidiaries, is engaged in the design, manufacture, marketing and distribution of musical instruments. The Company operates in two segments: pianos, and band & orchestral instruments. The Company, through its piano (Steinway) and band (Conn-Selmer) divisions, manufactures and distributes products within the musical instrument industry. Steinway produces the piano. Conn-Selmer is a domestic manufacturer of band and orchestral instruments and related accessories, including complete lines of brass, woodwind, percussion and string instruments. Its offerings include Selmer Paris saxophones, Bach Stradivarius trumpets, C.G. Conn French horns, Leblanc clarinets, King trombones and Ludwig snare drums.

Piano Segment

The family of Steinway-Designed Pianos consists of its three brands: Steinway & Sons, Boston and Essex. The Company also offers Steinway & Sons upright pianos, as well as two mid-priced lines of pianos under the Boston and Essex brand names. It offers two product lines under the Steinway & Sons brand: grand pianos and upright pianos. It offers seven sizes of the grand piano ranging from the 5 feet 1inch baby grand to the largest nine feet concert grand. The smaller grands are sold to both individual and institutional customers, while the concert grands are sold primarily to institutions. Steinway & Sons also offers art case pianos designed by either Steinway master craftsmen or renowned artisans. During the year ended December 31, 2011, it sold 2,013 grand pianos, of which 1,101 units were shipped from its New York facility to dealers in the Americas. The remaining 912 units were shipped from its German facility primarily to Europe and Asia.

Band Segment

The Company is a producer of band and orchestral instruments and offers a range of brass, woodwind, percussion and string instruments. During 2011, sales of sourced products accounted for approximately 40% of its band division revenue. It also imports other products, such as saxophones, outfit drums and accessories. The Company manufactures piccolos, flutes, clarinets, oboes, bassoons, trumpets, French horns, tubas, and trombones in its manufacturing facilities in Indiana and Ohio. In addition, it also manufactures intermediate and professional level woodwind and brass instruments. Sales of woodwind and brass instruments accounted for 64% of it band division revenue during 2011.

The Company sells its woodwind and brass products under the brand names Bach, Selmer, Selmer Paris, C.G. Conn, Leblanc, King, Armstrong, Holton, Yanagisawa, Vito, Emerson, Avanti, Noblet and Benge. It is the United States distributor for Yanagisawa saxophones and Selmer Paris saxophones and clarinets. The Company manufactures, sources, and distributes acoustical and tuned percussion instruments, including outfit drums, marching drums, concert drums, marimbas, xylophones, vibraphones, orchestra bells, and chimes. It manufactures percussion products in North Carolina and Illinois under the Ludwig and Musser brand names.

The Company distributes violins, violas, cellos and basses. Products are sold under the brand names Glaesel, Scherl & Roth, and William Lewis & Son. It manufactures mouthpieces and distributes accessories, such as music stands, batons, mallets, straps, mutes, reeds, pads, chin rests, strings, bows, cases and instrument care products. Sales of accessories accounted for 19% of its band division revenue during 2011.

The Company competes with Bosendorfer, Fazioli, Bechstein, Schimmel, Kawai, and Yamaha.