Today, Bureau Veritas hosts its Capital Markets Day during which
the Group will present its 2028 strategy and financial
ambitions:
- New customer-centric vision, to be the preferred partner for
customers’ excellence and sustainability
- New strategy LEAP I 28 to deliver a step change in
growth and performance, built around three pillars: Portfolio,
Performance and People, with sustainability at its core:
- Active Portfolio management strategy designed to enhance
leadership positions through organic growth, accelerated M&A
and portfolio high-grading
- Performance programs identifying meaningful efficiency and
productivity benefits from operational leverage, functional
scalability and innovation
- An evolved People model, leveraging the Group’s deep-rooted
knowledge and expertise to train and develop strategic competencies
needed for future growth
- Staying true to its purpose of “Shaping a world of trust by
ensuring responsible progress”, Bureau Veritas will be fully
engaged to deliver on its CSR commitments
- Ambition 2028: high single-digit total revenue growth1 (with
mid-to-high single-digit organic), consistent adjusted operating
margin improvement2, double-digit shareholder returns based on EPS
CAGR1 and dividend yield, and strong cash conversion2 (above
90%)
- In support of its strategy, and reflecting its financial
health, Bureau Veritas intends to acquire its own shares for up to
200 million euro in 2024
Hinda Gharbi, Chief Executive Officer, commented:
“For nearly two centuries, Bureau Veritas has brokered trust
between business and society. Building on our long-standing
reputation for technical expertise, high quality and integrity, we
are uniquely positioned to leverage our global reach and broad
capabilities. Our vision is to be the preferred partner for our
clients’ excellence and sustainability, enabling our customers
to navigate technological and societal changes to transform and
perform sustainably.
Our new strategy, LEAP I 28, is a new chapter in
our history as we aim to achieve a step change in our leadership
and performance, both in terms of growth and shareholder
returns.
By actively managing our Portfolio, we aim to be the leader in
the markets we serve where we already occupy a top three leadership
position, invest to build new growth strongholds in strategic
markets and optimize value and impact from the remainder of the
portfolio. Our new Performance-centric execution model will enhance
our customer value proposition through technology and scalability
and will enable opex investments to fund our growth ambition and to
drive margin improvement. Our People model will evolve to ensure we
attract and develop the strategic competencies needed to enter new
markets and sustain higher growth.
We are targeting mid-to-high single digit organic revenue
growth, consistent adjusted operating margin improvement and
double-digit shareholder returns based on EPS CAGR and dividend
yield.
I would like to warmly thank all our colleagues around the world
for their dedication and commitment to delivering on our new
ambitions. We also thank our shareholders for their continued
support.
I’m proud to lead this great company towards its bicentenary
with a renewed sense of purpose, energy and ambition, knowing that
its best is yet to come.”
A UNIFYING VISION
Bureau Veritas’ unifying vision is to be the preferred partner
for customers’ excellence and sustainability. This vision
translates into an ambitious, customer-centric strategy, leveraging
five secular trends: Sustainability, Energy Transition,
Connectivity & Digitalization, Supply Chain Reconfiguration and
Urbanization.
LEAP I 28
This new vision translates into a new strategy based on three
pillars: Portfolio, Performance and People.
- Portfolio: Pursue undisputed market
leadership
Bureau Veritas will actively manage its Portfolio to attain
market leadership positions on prioritized and focused
businesses.
To this end, the Group will implement a three-fold approach:
- Expand leadership in existing strongholds with
established leadership positions, through a combination of rapid
organic scaling and inorganic expansion.
- Accelerate growth in selected markets to create new
long-term strongholds, investing early in fast growing
strategic sectors (sustainability, energy transition and cyber for
instance), where the Group has a clear path to market
leadership.
- Optimize value and impact from the remainder of the
portfolio in a granular and consistent way. Businesses that do not
meet stringent financial performance hurdles will be candidates for
performance improvement or portfolio high grading.
Portfolio ambition: Existing and
new strongholds account for c.55% of 2023 Group revenue and will
deliver 80% of incremental organic revenue over 2024-2028. In doing
so, the Group expects to reach a top three position in 90% of its
portfolio by the end of 2028 (versus 75% in 2023).
Acquisitions play a key role in Bureau Veritas’ strategy. Firmly
aligned with its “expand leadership and new strongholds” portfolio
strategic directions, the Group is ready to accelerate its M&A
ambition. While carrying on its bolt-on strategy, the Group will
remain open and attentive to mid-size opportunities (revenue above
100 million euro), in a very disciplined way, consistent with its
criteria of strategic fit, price, profitability and value
creation.
- Performance: a technology-augmented and modernized
execution
The Group will accelerate performance through programs designed
to deliver meaningful efficiency and productivity benefits. The
objective is to entrench higher granularity in the measurement and
management of the day-to-day business. It expects to also elevate
customer experience, and service quality versus competitors, and
will modernize and scale select operational and functional
processes to extract operational efficiencies.
The two programs are Operational Leverage & Functional
Scalability and Innovation.
1/ Operational Leverage & Functional Scalability. The
Group is enhancing its delivery models, to better serve its
customers and ultimately to reduce its cost to serve. Three key
areas of focus have been identified to extract operational
leverage: i) improving performance management and measurement; ii)
modernizing operational and functional processes; iii) developing
tech augmented service models.
2/ Innovation. Innovation and technology are the backbone
of the Group’s strategy through a three-layered approach. The Group
has invested in scalable enterprise systems, mostly cloud-based, to
strengthen its global operations across human resources, finance,
and sales. Bureau Veritas will also constantly capture data through
modernized operations systems, enabling its people in the field and
in labs to deliver superior customer service. The third layer
enables the Group to innovate with technologies including machine
learning and Artificial Intelligence (AI) to address customer needs
and create new revenue streams.
Performance Ambition: The Group
expects to accelerate growth through additional capacity from
enhanced productivity, with the ambition to deliver up to 100 bps
of operational leverage and up to 80 bps of functional scalability
within the 5-year period. Around half of these performance
programs’ savings are to be reinvested.
- People: Evolve Bureau Veritas’ People model
Bureau Veritas is a technical knowledge company with over two
thirds of its 83,000 employees possessing specific technical
expertise: technicians, engineers, scientists, and other
specialists. It excels in attracting and developing capable talents
from all around the world. As a service company, Bureau Veritas’
people skills and knowledge are critical to its market
differentiation and business success.
Recognizing the new dynamics around people and skills, Bureau
Veritas will evolve its people model, leveraging its deep-rooted
knowledge and expertise to train and develop in-house strategic
competencies needed for future growth, enhancing its competitive
advantage.
The Group’s competitive advantage and ability to outpace
competition will come from:
1/ “New economy” and strategic skills, around
sustainability, energy transition and digital, by developing a new
and systematic approach to the way employees’ skills are
developed.
2/ “Tech Augmented ways of working”: with the
increasing role of technology, Bureau Veritas will develop new
tech-augmented service models that require new skills and
competencies. These enhanced service models will free experts to
focus on adding value, improving productivity, and enhancing
customer service quality.
SUSTAINABILITY AT BUREAU VERITAS’ CORE
SUPPORTING CUSTOMERS’ SUSTAINABILITY JOURNEY
As customers’ organizations transform into more sustainable
enterprises, the demand for associated services is only increasing.
These include a range of activities: corporate strategy,
operational transformation advisory, product stewardship and
supply-chain reassurance, as well as non-financial reporting.
Bureau Veritas’ mission is to support its customers in their
transition journey to a new, sustainable state, through the
development of novel solutions, and an active network of experts to
support their transformation.
Capitalizing on its technical expertise, field DNA, global reach
and independent third-party role, Bureau Veritas’ ambition is to
actively support its customers’ sustainability journey from
transition to transformation. The Group will leverage its
differentiating attributes to build leadership positions in two
complementary segments of the market:
- Transition services: supporting clients’ move to more
sustainable business models, through two types of activity:
- ESG transformation services, i.e. supporting the implementation
and monitoring of plans,
- Compliance and reporting assistance services, supporting
clients’ efforts to comply with and communicate on regulatory and
voluntary disclosures;
- Green object services, supporting the build and maintenance of
green assets, green products, and green commodities – e.g.
renewables, new mobility, green fuels, etc.
Sustainability ambition: The more
narrowly defined subset of sustainability services – both
transition services and green objects combined, represents circa 5%
of 2023 Group revenue and is targeted to grow to 15% of Group
revenue by 2028.
2028 CSR AMBITIONS
Staying true to its purpose of “Shaping a world of trust by
ensuring responsible progress”, Bureau Veritas must be exemplary in
its own sustainability journey.
The Group’s CSR strategy addresses the three dimensions of
environment, workplace, and business practices, to drive a positive
transformation of Group activities and actions. This is delivered
through the engagement of its 83,000 dedicated employees to shape a
better environment, to shape a better workplace and to shape better
practices. Bureau Veritas will be fully engaged to deliver on its
CSR commitment. The Group will also accelerate its efforts built
around six priorities: climate, circularity & biodiversity,
health & safety, human capital, diversity, and ethics.
The Group is committed to the achievement of five key
performance indicators through 2028:
UNITED
NATIONS’
SDGS
2023
2028
TARGET
ENVIRONMENT / NATURAL CAPITAL
CO2 emissions (scope 1 & 2,
1,000 tons)
#13
149
107
SOCIAL & HUMAN CAPITAL
Total Accident Rate (TAR)3
#3
0.25
0.23
Proportion of women in leadership
positions4
#5
29%
36%
Number of training hours per
employee (per year)
#8
36.1
40.0
GOVERNANCE
Proportion of employees trained
to the Code of Ethics
#16
97%
99%
2028 FINANCIAL AMBITION
Bureau Veritas is now a more resilient business and capable of a
step change in growth and profitability. The new mid-term financial
targets reflect this ambition:
2024-2028
GROWTH CAGR
High-single digit total
revenue growth5
With:
Organic: mid-to-high single
digit
And:
M&A acceleration and
portfolio high-grading
MARGIN
Consistent adjusted operating
margin improvement5
EPS CAGR5 + DIVIDEND
YIELD
Double digit returns
CASH
Strong cash conversion6: above
90%
CAPITAL ALLOCATION - AN ACCELERATED EXTERNAL GROWTH POLICY
Over the period 2024-2028, the use of Free Cash Flow generated
from our operations will be balanced between Capital Expenditure
(Capex), Mergers & Acquisitions (M&A) and shareholder
returns (Dividend):
ASSUMPTIONS
CAPEX
Around 2.5-3.0% of Group
revenue
M&A
M&A acceleration
DIVIDEND
Pay-out of 65% of Adjusted Net
Profit
LEVERAGE
Between 1.0x-2.0x by 2028
In support of its strategy, and reflecting its financial health,
Bureau Veritas intends to acquire its own shares for up to 200
million euro in 2024, within the share buyback program approved by
the shareholders meeting. This would be funded through available
resources.
CONNECTING TO CAPITAL MARKETS DAY
- Schedule (Paris Time): Wednesday March 20, 2024 – 9:00am CET to
13:00pm CET
- The presentation slides will be available at:
https://group.bureauveritas.com/capital-markets-day-2024
- Please register and connect to
https://investorday-bureauveritas.com/register to access the live
event.
FINANCIAL CALENDAR
- Q1 2024 revenue: April 25, 2024
- Shareholders’ Meeting: June 20, 2024
- Half Year 2024 Results: July 26, 2024
- Q3 2024 revenue: October 23, 2024
About Bureau Veritas
Bureau Veritas is a world leader in inspection, certification,
and laboratory testing services with a powerful purpose: to shape a
world of trust by ensuring responsible progress.
With a vision to be the preferred partner for customers’
excellence and sustainability, the company innovates to help them
navigate change.
Created in 1828, Bureau Veritas’ 83,000 employees deliver
services in 140 countries. The company’s technical experts support
customers to address challenges in quality, health and safety,
environmental protection, and sustainability.
Bureau Veritas is listed on Euronext Paris and belongs to the
CAC 40 ESG, CAC Next 20, SBF 120 indices and is part of the CAC SBT
1.5° index. Compartment A, ISIN code FR 0006174348, stock symbol:
BVI.
For more information, visit www.bureauveritas.com, and follow us
on Twitter (@bureauveritas) and LinkedIn.
Our information is certified with blockchain technology. Check
that this press release is genuine at www.wiztrust.com.
This press release (including the appendices) contains
forward-looking statements, which are based on current plans and
forecasts of Bureau Veritas’ management. Such forward-looking
statements are by their nature subject to a number of important
risk and uncertainty factors such as those described in the
Universal Registration Document (“Document d’enregistrement
universel”) filed by Bureau Veritas with the French Financial
Markets Authority (“AMF”) that could cause actual results to differ
from the plans, objectives and expectations expressed in such
forward-looking statements. These forward-looking statements speak
only as of the date on which they are made, and Bureau Veritas
undertakes no obligation to update or revise any of them, whether
as a result of new information, future events or otherwise,
according to applicable regulations.
1 At constant currency 2 (Net cash generated from operating
activities – lease payments + corporate tax)/adjusted operating
profit 3 TAR: Total Accident Rate (number of accidents with and
without lost time x 200,000/number of hours worked). 4 Proportion
of women from the Executive Committee to Band III (internal grade
corresponding to a management or executive management position) in
the Group (number of women on a full-time equivalent basis in a
leadership position/total number of full-time equivalents in
leadership positions). 5 At constant currency. 6 (Net cash
generated from operating activities – lease payments + corporate
tax)/adjusted operating profit.
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version on businesswire.com: https://www.businesswire.com/news/home/20240320033795/en/
ANALYST/INVESTOR
Laurent Brunelle +33 (0)1 55 24 76 09
laurent.brunelle@bureauveritas.com
Colin Verbrugghe +33 (0)1 55 24 77 80
colin.verbrugghe@bureauveritas.com
Karine Ansart +33 (0)1 55 24 76 19
karine.ansart@bureauveritas.com
MEDIA
Anette Rey + 33 (0)6 69 79 84 88
anette.rey@bureauveritas.com
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