EuroBusiness Media (EBM): AKKA Technologies, a leading European engineering and technology consultancy, has just reported its 2014 results. Hello Maurice Ricci. You are the CEO & Chairman of AKKA Technologies. Looking at 2014, what were the key events of the year?
Maurice Ricci: I think the main event was meeting our business targets, with revenue of €885 million, operating profit of €55 million and net profit of €27 million. The company has the capacity to finance its growth, with gearing of 23% and €220 million in cash. These are important points, especially as they come in the middle of a transformation. In three years, the Group has doubled in size. We are in the middle of a reorganisation, or rather a business transformation plan, to take us even further.
EBM: This year, you exceeded the threshold of 50% of revenue generated outside France. Mbtech, your acquisition in Germany, has now been successfully integrated. What are the keys to this success?
Maurice Ricci: You are right to highlight the Group’s international position. In 2010, 85% of our revenue came from France, but less than 50% in 2014. We often speak about the integration of MBtech. You need to remember that Aeroconseil and MBtech, which were bought in 2011 and 2012, together represent nearly €400 million in assets, and were actually incorporated in only a little longer than it took to integrate Coframi in 2007, with revenue of just €140 million. Today, the context is international, and the companies much larger, so yes, I think we’ve achieved these integrations very quickly.
EBM: What growth potential does this offer you in Germany and internationally?
Maurice Ricci: The group first grew in France. In Germany, the objective is to have a European base. When we acquired MBtech, we wanted to double in size, first to satisfy our strategy of balances, since MBtech brought us our biggest customer – Mercedes has become our leading customer – and we needed to diversify it with other German OEMs and then in the aerospace and rail sectors. So it has given us strong growth in Europe, which will continue in line with our transformation plan, which will come to an end in 2018, and now we are accelerating internationally.
EBM: Precisely, your international acceleration has already begun in a way, with the joint venture agreement you just signed in China. How does this fit into the medium-term strategic plan?
Maurice Ricci: You are quite right to point this out. Very, very often we talk about our vision, but it takes time to translate it into reality, and we already have an international focus, as our short-term aim is really to complete our growth in Germany. The interesting thing about BAIC is that it is carmaker that has only existed for a few years, but which already makes one and half million vehicles, compared with Renault for example, one of our oldest customers, which currently only makes 2.4 million. It also has very, very good results. They have the capacity to achieve their ambition, to release two vehicles per year, which is huge in engineering terms. The question we might ask is why they came looking for a small European engineering company. I think this really highlights our expertise and positioning in terms of value added. This differentiating factor should give us very strong leverage in our international expansion. We have BAIC, a carmaker in China, we have aerospace and automotive clients in Russia, we have aerospace and automotive clients in Japan, and we are starting to work with Boeing, which opens the door to aerospace in the United States. It is clear that after the end of our European construction, there will be a strong acceleration on all other continents.
EBM: To conclude, what are the targets for 2015, and more so those for the medium term, in your strategic plan?
Maurice Ricci: On our European base (which brings us to 2018), we are committed to delivering €1.2 billion in revenue and €100 million in operating profit. These numbers will naturally continue to finance our growth, but they also correspond to market dimension. The next step, for which don’t yet have any detailed projections, should be one of exponential growth.
EBM: Maurice Ricci, CEO & Chairman of AKKA Technologies, thank you.
Maurice Ricci: Thank you for inviting me.
