EuroBusiness Media (EBM): Welcome to all of you. I’m Nadia Charbit and today, I am pleased to interview Didier Michaud-Daniel, the CEO of Bureau Veritas. Bureau Veritas is a world-leading provider in testing, inspection and certification services. The company is at the heart of key challenges: quality, health and safety, environmental protection and social responsibility. Didier, hello!
Didier Michaud-Daniel: hello Nadia!
EBM: I am delighted to see you again to discuss Bureau Veritas annual results!
Didier Michaud-Daniel: Thank you Nadia. Important milestones have been reached since our last interview one year ago. I'm pleased to share with all of you the main highlights of our 2018 performance.
EBM: So, what were the main trends for Bureau Veritas in 2018?
Didier Michaud-Daniel: If you remember, Nadia, in 2017, Bureau Veritas recorded a solid performance. This trend continued in 2018, with another year of growth acceleration. Let me give you some meaningful figures showing our progress: We achieved a revenue of 4.8 billion € in 2018, with an organic growth of +4.0%. Our adjusted operating profit reached 758 million € with an improved organic margin at 16.1% and we generated a free cash flow of 478 million €, a major step up in our cash generation performance.
Another important fact is that our Group further enhanced its cyclical resilience, thanks to 2 strong moves: the diversification towards more Opex activities, which rely on existing assets and give us more visibility and repeat business and a more balanced geographical footprint across three platforms: the Americas, Asia, and Europe.
EBM: Can you please share with us some key achievements from 2018?
Didier Michaud-Daniel: I would like to focus on 3 topics: Management, Acquisitions, and Transformation.
Concerning the Management, we have appointed several new members to our Group Executive Committee. We are now a team of ten, of which 20% are women. This is a good start, but is not enough: we are committed to reach at least 25% female representation on the Group’s executive management team.
These management changes strengthen the governance of Bureau Veritas, with even more international leadership. It also strengthens the Group operations on a day-to-day basis, with a leaner decision-making process.
EBM: What were Bureau Veritas’ main acquisitions last year?
Didier Michaud-Daniel: Bureau Veritas acquired six companies in six different countries: USA, China, Japan, Morocco, Malaysia, and Spain.
These acquisitions strengthen our know-how and footprint, particularly in Buildings and Infrastructure, Agri-Food as well as in Opex services.
The Group’s M&A pipeline is robust and will provide many opportunities moving forward.
But we will of course maintain our strict financial discipline here.
EBM: Transformation is an important driver of the company. What can you tell us about it?
Didier Michaud-Daniel: Firstly, Nadia, our transformation is reflected by the implementation of the key customer account management strategy, launched in 2014. The Group strengthened the coordination between global market and regional sales leadership, in a more focused sales governance model.
Bureau Veritas also made significant steps towards more integrated high-value solutions. A perfect illustration is the 5-year contract win with Qatargas, the world's largest LNG producer. Secondly, Digital is still at the heart of our transformation. Our digital strategy focuses on three dimensions: improving the Group’s efficiency in delivering its portfolio core services; leveraging digital technologies to implement new operating models; launching new services to support client needs in the digital world.
In 2018, Bureau Veritas launched multiple market-oriented digital solutions, based on technologies such as 3D, the Internet of Things, Robotics, Artificial Intelligence, and e-commerce.
These solutions were successfully tested and deployed with clients in various businesses. As an example, we have just announced a global partnership between Bureau Veritas and Microsoft on Artificial Intelligence.
EBM: What are your ambitions for Bureau Veritas in the coming years?
Didier Michaud-Daniel: For 2019, we will build on our successes in 2018 so that the Group can deliver further solid organic revenue growth, a continued improvement in adjusted operating margins, and a sustained strong cash flow generation.
We remain confident in delivering our 2020 ambition.
Beyond these financial figures, I want to insist on the other ambitions that we have defined: in Health and Safety, we want to reduce accident rates by 50% compared to 2015. Regarding Inclusion, as explained previously, we need to achieve at least 25% female representation on the Group’s executive management team. And last but not least, in line with our commitments towards a better environment, we want to reduce CO2 emissions by 10% per full-time equivalent, increase the use of renewable energy by 10%, and achieve 75% of Group activities certified against ISO 14001.
EBM: Didier, before we close this interview, is there a specific message you'd like to share?
Didier Michaud-Daniel: Yes Nadia. I wish to thank all our employees around the world for their efforts which have made these strong set of results possible. With their breadth of expertise and professional backgrounds, they represent the most important asset in our ability to generate value for our stakeholders.
Our people are proud to see that their work makes a positive impact every day on the lives of millions of people around the world. Bureau Veritas’ successes are their successes.
