Strategy and policies
Batenburg Beheer N.V. consists of companies that provide services in the fields of installation engineering and technical trade. The activities of these two different segments are currently carried in the utility construction, industrial and infrastructure segments, together employing more than 1,000 people. Revenues are generated primarily in the Benelux countries. The strategy of Batenburg Beheer N.V. is aimed at sustained, profitable growth from a solid financial and independent position. Its strategy is structured from within the small-scale holding company and is discussed at regular intervals with the Supervisory Directors and managements of the operating companies.
The Batenburg companies aim to distinguish themselves on the basis of a flexible and customer-focused approach and the quality of the services and products they deliver. Long-term relationships, knowledge of customers’ processes and possible product applications, as well as brainstorming with the customer in the engineering phase, are highly important in this respect. To achieve this, the operating companies need expert and motivated employees, a local presence and national cover, a good price/quality ratio and a solid balance sheet position.

Financial objectives
Batenburg Beheer N.V. endeavours to grow by at least 5% a year on average, with a net return on revenue of 4% and a net return on average capital invested of 12.5%. At least 40% of the profit is distributed annually. Batenburg Beheer N.V. wants to be a reliable and solid partner for all the company’s stakeholders. From a financial perspective, this entails a solvency target, corrected for goodwill, of at least 40%.

In the exceptional market circumstances in the Netherlands and Belgium in 2009, the financial objectives were not realised to a large extent. Profits were under heavy pressure and significantly lower demand for our products and services meant that there was a clear organic diminution in revenue. A positive point is that the necessary measures were taken quickly and that the company showed resilience and flexibility, as a result of which the financial year ended with a profit. The positive cash flows and strong solvency also appear to be a strong argument for clients and suppliers to do business with Batenburg companies. The good financial position also enables us to provide a high payout on the lower result for 2009, as a result of which the shareholders also realise an attractive dividend yield.

Structure
The Batenburg Group has an organisational structure devolving far-reaching powers and responsibilities to the individual operating companies. They carry out their activities in a way that preserves their own identity and are individually responsible for their sustainable, profitable continuity. This stimulates entrepreneurship at the base of the organisation to the fullest extent possible. Having said that, there is 'freedom in restraint'. The correlation in the implementation of the strategy is stimulated through central support in such disciplines as ICT and purchasing. Cooperation and the exchange of knowledge are stimulated through central training and regular group specialist meetings.

New policy emphases
In the last years, a strong concentration arose in the energy sector. The number of energy companies in the Netherlands has rapidly been reduced to a limited number of major players. The company responded adequately to this by concentrating the supply for this client group in one of our trading companies in order to remain an attractive negotiating partner and supplier for these larger clients.
More recently, we have seen a similar trend among some of the clients of our installation companies. In the past, we worked for a significant number of regional clients who were served from regionally-oriented installation companies in our Installation group, with a recognisable local image. However, for some years now clients in industry and the wet infrastructure segments have been transferring production activities to locations outside the Benelux region, while the (remaining) activities have been upscaled. In non-residential construction, the local character is also diminishing with a shrinking supply of work. There is then a flight to the contracting market, where price is the primary guide for granting tenders, possibly in combination with the action plan. The final development we have observed is that our revenue of national retail organisations is growing, strengthened by the recent acquisition of the activities of vanPanhuis and OSP.

These developments led to a change in the emphases in the decentralised implementation of the strategy, which has been successful for years. A start was made on the envisaged changes in 2009. Without wishing to abandon the decentralised organisational structure completely or damage local enterprise, more attention is devoted to co-operation and there is more central steering of some elements. In addition to the aim of responding more effectively to the requirements of clients and suppliers, the company emphatically aims to address certain matters still more efficiently than in the past. A number of priorities were formulated here for the different segments.

Installation

• In the non-residential construction market, demand for all-round installations is rising, driven by demand for sustainable buildings and living environments. At the same time, the area served by a company or branch is diminishing, partly through growing congestion on the roads. In the past, the Batenburg companies were primarily electrical engineering installation companies. The acquisitions policy will therefore be aimed at acquiring more knowledge and capacity in the field of climate control technologies. New branches must also contribute towards the maintenance and expansion of the service areas. The acquisition of the Meurs and OSP/vanPanhuis companies in 2009 by Van Dalen Installatietechniek was a first step towards increasing mechanical engineering know-how in the Batenburg Group.
• Several of our installation companies offer national maintenance and servicing, particularly in the retail sector. In order to serve clients as effectively and efficiently as possible, it is desirable to intensify co-operation in this field within the group and with external parties. The said acquisition of OSP in Putten forms the cog for the creation of a national service organization with its own branches and external support points.
• Our installation companies Beenen, Koldijk and JB Systems (part of the Hoogendoorn Group) offer clients in industry and the wet infrastructure advanced services in the field of process automation and machine operations. The separate market approach does not sufficiently reflect the fact that together, these companies are a prestigious player in the field of industrial automation. Increasing requirements for qualification and certification by certain client groups and suppliers makes further upscaling of the industrial automation activities and stronger profiling necessary. In recent years, co-operation and the exchange of information between the Beenen, the Industry & Infra Koldijk business unit and JB Systems has already grown considerably. In connection with this, ways to improve profiling to the market and to further intensify the co-operation are being investigated.

Trading

• In 2009, cost awareness was high and planned major investments were postponed or cancelled due to the difficult economic conditions. Cost control will remain a focus of increased attention in 2010. Possibilities for achieving further cost synergies in the support services of the trading companies are being investigated further.
• Individually, the trading companies hold good market positions. They contact their clients on the basis of the existing product range and the accompanying knowledge. In order to be able to grow faster, as start was made on cross-selling to the industrial clients in the final quarter of 2009. The first successes have now been achieved and this approach will be continued in 2010. Attention will also continue to focus on external growth in order to improve market positions, achieve scale benefits and diminish the risks of loss of business.

All in all, this presents us with a number of important challenges and changes that we consider necessary in order to emerge stronger from the recession.

Read more