2015 Strategic Plan Operational Presentation Part2

8/11/2019 2015 Strategic Plan Operational Presentation Part2

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BUREAU VERITAS

2015 STRATEGIC PLAN

Tuesday, September 20, 2011


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SELECTED BUSINESS HIGHLIGHTS


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EXPANDING OUR VALUE IN THE

SUPPLY CHAIN

Oliver Butler

Execut ive Vice President, Consum er Produc t Services

FOCUS ON CPS


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4 - Copyright Bureau Veritas

A global leader with a buy and build DNA

Global Leader in Toys/Hardlines

Number 2 in Softlines

Leadership position in US retail

Strong gains in EU retail

Strategic leader in quality

management information services

Strong growth in Electrical andElectronics

9,100 headcount

Europe

13%Asia

78%

Americas

9%

Textiles,

Garments

& Softlines

39%

Toys &

Hardlines

38%

Food /

Cosmetics1%

Electrical &

Electronics

22%

* As at June 30, 2011

Revenue breakdown*

Technicare /

QATC

98 01 03 04

AMTAC /ecb-

ONLINE

ADT (TW) / CurtisStraus / Actions

Mesures / MTLUK

MTL / LCIE

05

INNOVA /

Pakistan

08

GSC /CODDE / SPD /

Thurmelex /Furth

09

ACTS

10

NST

06 07

Haztec Kotiti VN /

ADT SH

11

Global platform built from acquisitions


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2007-2011 Achievements

Hardl ines

Toys

Soft l ines

Innovative solutions

Network expansion

Electr ical and

Electron ics

Renewables capabilities

Leadership in WiFi/WiMAX

Inspect ion,

Audi t and

Consul t ing

Significant growth

In format ion

Management

Services

Significant development

Lean

Management

World-class operational

performance

Client Loy al ty Retention

384m

LTM June 20112006

>10% organic growth p.a.

+470bps margin improvement

+50% headcount

#1 worldwide

22.1%

26.8%

26.8%Revenues Adj. Operating Margin

248m


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Supply Chain OptimizationGain ing c redib i l ity thro ugh benchmark per formance

Faster

Cheaper

Better

Helping our clients to succeed

CPS ServiceImprovement (08-11)

Clients benefits

Cycle time improved by 50%

Offset inflation impact

through productivity gains

Service quality99.9%

Service delivery98% +

Strengthening clientrelationship

Reduced logistics costs

Reduced product costs

Increased supply chain

productivity

Mitigated risk

Technical support

Global assistance


7/387 - Copyright Bureau Veritas

Moving from a narrow scope withinthe supply chain

PostShipment &After Sales

ProductionSupplierAssessment

RequirementsManagement

Pre-Production

Post-Production

Testing Testing

Inspection



to a more comprehensive offeringincluding decision support

CountryEvaluation

SpecificationDevelopment

Eco-design

Training

DesignEvaluation

Factory Assessment

Mill ImprovementProgram

Comparison Test

Packaging Test

Risk Assessment Matrix

Life Cycle

Process ControlPlan Development

Inspection

Process ControlPlan Audit

ProductDisposition

Loading Check

Technical FileReview

Unloading Check

In-Store Testing

Failure & ReturnsAnalysis

Business Reviewand ContinualImprovement

PostShipment &After Sales

ProductionSupplierAssessment

RequirementsManagement

Pre-Production

Post-Production

Testing Testing



Supply China quality management solutionsto attract and retain customers

Market Adviso ry

Services

Suppl ier

Validation

Services

Product Quali ty

Services

Qual i ty

Management

Outsourc ing

Sourcing trends & hotspot management

Regulatory requirements and compliance plan

Supplier vetting and traceability

Factory Audits, Quality Benchmarks

Reducing failures & returns

Optimizing cost of quality & time to market

Supply chain quality management services

Process reengineering

Cost efficiency



Facing a growing but changing business

$10bn market+5% growth p.a. 2010-15

Source: Bureau Veritas, McKinsey

What do we see! Shifts in decision authority

Supply chain cost management

Sourcingshifts within Asia

Food safety

Technology innovation

Environmental sustainability

Intermediaries

Brande

d

manufacturers

Retailers / sourcing offices

Brands

Trading companies

Full service manufacturers

Factories

Food /

Cosmetics

48%

Textiles /

Softlines

10%Hardlines

& Toys

14%

28%

Electrical& Electronics



Where are we going: 2012-2015 priorities

Global player in Food

Global player in E&E

Active in all key markets

Market leader in softlines/ IAC

Leader in supply chain quality management

EU New Toy Safety Directive

RTP and Food Safety Modernization Act in USA

Expand partnerships and alliancesOptimise all channels

Accelerate market penetration

Ambition

Growth

initiatives

2011 portfolio

2015 portfolio

Food / Cosmetics

1%

Hardlines& Toys

38%

Textile & Softlines

39%

E&E

22%

Food / Cosmetics

9%

Hardlines

& Toys

30%

Textile & Softlines

35%

E&E

26%



Organizat ional

Effect iveness

&

Regional

Opt imizat ion

Architecture for continued profitable growth

Outsourcing

Food / E&E

Asia + China Growth

Continuous Improvement

Supply Chain

Solutions

Maintaining

and Growing

the Base

WinGovernmentrelations &

Partnerships

Acquisition &Integration

Outsourcing Management

Executive Supply Chain Leadership

Client Supply Chain Quality Management

Solution

World Class Business & Technical Leadership

World Class Global Operations Network



Wrap Up

1

2

3

4

5

The market growth opportunity is achievable

Organization is well positioned

Many growth initiatives already underway

Acquisition pipeline is healthy

Great team in place


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BUILDING A

SUSTAINABLE ELDORADO

Eduardo Camargo

Execut ive Vice President

Lat in America Zone



580m people (8% of world population)

17 countries and only 2 languages

GDP: 80% of Mainland China

Brazil: the B of BRICs

30% of total population and 40% of total GDP

Strong economic recovery from crisis

Favorable economic scenario

15% of worlds oil reserves, large stock of

minerals, 25% of worlds arable land and 30%of world fresh water

40m people lifted out of poverty between 2002

and 2008

Commodities demand increase and huge

capital inflows pushing local currencies

A rising influence on world economy



Positive economic forecasts and political stability

Booming demand for commoditiesand increased trading flows

Accelerating growth of domestic consumption

Strong investments in energy and infrastructure

Progressive privatizationof government verification services

Tighter QHSE regulations with need for third party verification

Fragmented competitionwith progressive consolidation

National content rules for large projects

Strong TIC growth drivers



Capitalizing in the future on the assetsweve built

Leadership

Organizat ion

Innovat ion

Key accou nts

Growth plat form

M&A

track reco rd

Prominent position in Oil & Gas, Power & Utilities,

Minerals, Automotive and Certification

Long term partnerships with national key

accounts through customized solutions

Solid organization in key countries and promising

leaders

Regional technical & commercial centers of

excellence creating competitive barriers

Existing portfolio presenting significant growthopportunities

Successful integrations and relevant potential

acquisitions



Revenues x 4 since 2006

~90m

Brazil development

Chile and Argentinadevelopment

Leadership andacquisitions

Expanded scopeNew growth areas

2006 2007 2008 2009 2010 LTM2011 PF

>350m

Average organic grow th

> 18% p .a.

f f



A solid and diversified growth platformbuilt over time

1970 1980 1990 2000 2010

Marine and Oil& Gas Offshore

IndustrialServices

Oil & GasOnshoreIndustrialServices

Power andUtilities

IndustrialServices andCertification

MiningIndustrial andCommodities

Testing Services

Automotive andSupply Chain

InspectionServices

Environmental,Agri Food and

Oil & ChemicalsTestingServices

Infrastructureand PublicServices

Verification

Centers ofExcellence

Bureau Veritas footprint

HC 8,500

Offices 89

Labs 33

Revenues >350m

IndustryCommodities

Certification

GSITIVS

MarineConstruction

Brazil

Chile

Argentina

Peru

Mexico

ColombiaOthers

Three mainregions

L di iti i f t i Oil & G



Engineering, Procurement and Construction

Conformity Assessment

Asset Integrity Management

Quality Assurance and Quality Control

Non Destructive Testing

HSE Testing and Suppliers Audits

Commissioning Supervision Technical Outsourcing

Leading position in fast-growing Oil & Gasand Power industries

Service offering

Surge of Oil & Gas Exploration &

Production (Offshore) and Powerproduction plants CAPEX

Need for risk management and

performance improvement with external

recognition

Increasing outsourcing of conformity

assessment activities

2012-2015 growth drivers

Keyaccounts

# 1 in Oil& Gas and Power Indus tr ies in Lat in Am erica

Cl ients int imacy and k now ledge of assets and proc essesUnrivaled local techn ical capabi l i t ies and references

P t b f d li



Petrobras preferred supplier

Sales &Marketing

Brand &Recognition

TechnicalResources

Marine & offshore classification and certification

E&P Units, Sub sea & drilling systems technical consulting

Procurement services: Shop inspection, expediting and suppliers evaluation

Onshore & offshore Asset Integrity Management

Integrated solutions upstream & downstream and CAPEX & OPEX

Oil & fuel and HSE testing

A t f ll t t



Brazil: biggest (ultra) deepwater opportunities

A center of excellence to support ourclients in the deepwater challenge

and record drilling depth

Pirauna

Marimba

Marlim SulRoncador

Roncador

Enchova

Tupi

2,629m

1977

2,825m

1983

3,318m

1988

3,230m

1994

3,759m

1999

4,343m

2003

7,000m

2007

Brazi l

Reserves: 26.1 bn boe

19 projects

US Golf of

Mexico

Malaysia

Angola

Congo

Ghana Nigeria

Our credentials

To come

Subsea Certification

To come

P55 Rig Classification

To come

P53 FPSO Classification

C tifi ti d i k t d i b



Quality, Environment, Health & Safety

and Social Responsibility Management

Systems:

Accredited certification

2ndparty audits

Suppliers evaluation

Supply chain and services audits

HSE studies and outsourcing

Product certification Training

Certification: a dynamic market driven bylarge accounts and new schemes

Service offering

Development of customized solution to

large accounts

Suppliers evaluation

HSE management systems outsourcing

New specific schemes

Green House Gases / Energy Efficiency

Food / Forestry / Biofuels


Keyaccounts

# 1 Cert i f icat ion in Lat in America

Undis pu ted leadership in main cou ntr ies (Brazi l , Arg ent ina, Chi le and Mexico)

C diti th i L ti


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Oil & Chemicals Inspection and Testing:

Upstream Exploration & Production

Downstream fuel control (fixed and mobile labs)

Metals & Minerals Inspection and Testing:

Geochemical

Metallurgical

Trading

Agricultural Inspection and Testing

Laboratory Outsourcing

Commodities: our new growth area in LatinAmerica

Booming demand for commodities

Leading position in Chile minerals

market as zone hub

Increasing Oil & Gas and mining

Exploration & Production CAPEX

Development of national key accounts

with relevant synergies for industrial

services


# 2 in Commodi t ies in Lat in Amer ica

Leading pos i t ion in Chi le minerals m arket

Service offering

Keyaccounts

A t ti f i i


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Supply chain:

Transportation damage tracking

Distribution stock control

Insurance / Fleet Management :

On hireOff hire

Damage regulation

Statutory Verification Services

Emission control

Safety testing

Automotive: a new scope of services in afast growing market

Fleet Increase and renewal with

acceleration of insurance market

penetration

Increase of trade flows

Privatization of verification services

Geographical expansion

Replication of inspection services to

other consumer markets

Household appliances

Hardware


# 1 Au tom otive in Lat in America (acqu isi t ion of Au to Reg in Jan. 2011)

Preferred su pp l ier of main Insurers and car manu facturers

Keyaccounts

Service offering

2015 priorities for Latin America


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2015 priorities for Latin America

Double-d ig i t organic growth M&A con sol idat ion

Plat form org anizat ionCont inuou s per formance

improvement

Explore full potential of investments

in energy and infrastructure

Continue portfolio diversificationwith Commodities, Automotive and

Infrastructure

Grow recurrent business to mitigatecyclical risk

Pursue strategic acquisitions to fillthe gaps

Geographies

Portfolios

Consolidate benefits from scalability

Accelerate investment in IT/ISsystems

Laboratory automation

Reinforce centers of excellence

Retain and develop next generation

Shared service centers for supportfunctions


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RESILIENCE & INNOVATION

Philippe Donche-Gay

Chief Operat ing Off icer

FOCUS ON EUROPE

The Euro Party might be over ?


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The Euro Party might be over ?

Loss of momentum in Euro-zone economy

GDP slowdown, with risk of downturn

Increasing fiscal imbalance

Rising government bond yields

Weaker external demand

Source: International Monetary Fund, World Economic Outlook, June 2011

Still Europe remains a core TIC market


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Still, Europe remains a core TIC market

27 countries, 510 million inhabitants

#1 world economy

~25% of world GDP

~30% of Global Fortune 500

World largest trading power

Key sectors: agriculture, automobile,

aeronautics, energy, IT, tourism, finance

R&D spending: ~2% of GDP

HQ of many Normalization bodies

Proliferation of European Directives

Home base of all major TIC players

A regulatory Culture

European legislation published in 2010

o 698 Regulations

o 95 Directives

o 781 Decisions

A track record of steady profitable growth


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A track record of steady profitable growth

Organic and external development

1996 1998 2002 2006

I&F UK

Consumerproducts

2001 2007

SciroItalyCodde - France

2008

ECA - Spain

2009 2010

CEP

I&FGermany

Inspectorate - UK

2005

Casella - UKMTL - UKKW2 - NL

Nagtglass - NL

230 Offices7 900 Staff

Europe Network



to build a resilient portfolio

IVSConstruction

Industry

ConsumerProducts

Certification

Marine

Commodities

1.1Bn

1.5Bn

Pursuing profitable growth ambition by


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Pursuing profitable growth ambition by2015 with different regional priorities

Prof i tabi li ty Imp rovement Overall

Single Digi t Organic Growth

Operating margin

Finalize Integrations

Stabilize Management Refocus Portfolio

Conso l idat ion Transform at ion Rightsiz ing

Leverage Mass Market

Innovative Offerings Lean Initiative

Adapt to market demand

Leverage #1 position Revitalize Company

Large TIC growth potential in Europe


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Eastern

Western

Large TIC growth potential in Europe

Strong structu ral growth dr ivers

Aging Population/Safety Needs

Aging IndustrialAssets

EnvironmentalConcerns

NewRegulations

Growth inEastern Europe

Outsourcing ofPublic Services

Potential Market share gains in selected


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Potential Market share gains in selectedEuropean countries

Privatization of Public

Inspection agencies

Opening of TIC national

markets

Outsourcing of

Inspection services

New deep sea Offshore

opportunities

Opex services for industrial assets


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Opex services for industrial assets

OffshorePlatforms

> 250 offshore platforms in North Sea

20-25 years average life

Offshore Installations (Safety Case) Regulations

Certification & Verification Services

OilRefineries > 100 refineries in Europe

> 60-year average age

IPPC directive to reduce pollutants

Measurement of Fugitive Emissions

Nuclear

Plants

143 nuclear reactors in Europe

Plans for extended lifetimeor dismantling

Regulation reinforcement post Fukushima

NDT services for nuclear plant outages

Leveraging Green Building momentum


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Exis ting Bui ld ings

European & National Regulat ions

Leveraging Green Building momentum

New Const ruc t ions

The revised EPB Directive

wi l l generate addi t ional grow th for B V

Reduction in energy consumption

Key milestones in 2018 and 2020

Priority on Public buildings

Focused financial incentives

CE marking of construction products

Scope of building Technical Control

Structure Solidity

People Safety

+ Energy efficiency

Mandatory energy efficiency audits

Inspection of heat & cooling equipment

Monitoring of energy generation

installations

Adapting to a service-based economy


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Personnel Certi f ication

Shift to services driven market

Adapting to a service-based economy

Services Certi f ication

Evolving customer needs

opening potential for new offers

Need to certify quality of services

Role for independent third parties

New/customized standards

Europe still a backbone of Bureau Veritas


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Europe still a backbone of Bureau Veritasglobal development

Support to Bureau Veritas global network

Innovativeproduction models

Schedul ing &

Report ing tools

Nuclear

Construction

Marine

Offshore

TechnicalExpertise

GlobalClients

France/China Init iat ive

10 Major EU acco unts 2010


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BUREAU VERITAS

2015 STRATEGIC PLAN

Tuesday, September 20, 2011

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2015 Strategic Plan Operational Presentation Part2

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