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November 17, 2014 - Molitor INVESTOR DAY Drivers of Growth Acceleration 1 Agenda 8:30–8:40 Introduction 8:40–9:40 Foncia Presentation 9:40–10:40 Asmodee Presentation 10:40–11:00 Break 11:00–12:00 Desigual Presentation Round table discussion with 12:00–13:00 Vignal Lighting Group, IES Synergy & Cap Vert Finance Conclusion 2 Investor Day, November 17, 2014 November 17, 2014 The Path to Growth Speakers François DAVY CEO . Previously member of the Executive Board of Adecco Group Worldwide . Prior to Adecco, various top management positions at La Poste, Motorola and Cadbury Schweppes . President of Employment Committee at Medef (French Association of Employers) Nicolas CHANDOU CFO . Previously with Lehman Brothers, Bank of America and Hawkpoint Partners . Extensive experience in Investment Banking (M&A, DCM and ECM) 4 What are FONCIA businesses? Shared areas • FONCIA manages building areas jointly-owned (Roof, Façade, by apartment owners (financial and technical Lift, Parking, standpoints) Heating system…) “Joint-Property Management” • FONCIA manages landlord’s rented apartments, Rented and, in particular, helps find new tenants apartments “Lease Management” “Renting” All • FONCIA can help owners sell their apartment, and handle the whole sale process apartments “Brokerage” FONCIA serves all the needs of apartment owners 5 My ambition for Foncia • Bring deep changes to our industry in terms of processes, client relationship and innovation • Focus on growth, transformation and differentiation, with digitalization as a cornerstone of our strategy, for Foncia to become a wholly digital leader by the year 2020 6 88% of FONCIA Group revenues come from recurring and predictable businesses Revenue (€m) Units/year FTE FONCIA key data Total €595m (2013A) Real estate brokerage 12% 9,400 69 Joint property management 31% ~1m 187 Lease management 28% ~260,000 164 ~6,200 *** Renting 10% 63,000 62 88% recurring Tagerim 2% ~100,000 10* International 9% Germany, Switzerland and Belgium - 53 ~630 Insurance brokerage, technical ** Related services 8% diagnosis, REIT management, etc. - 50 ~530 (*) Full year impact: €44.5m (**) Including Interco (***) Including HQ 7 1. Path to Grow Strategy Reminder: strategic priorities defined in 2012 5 key dimensions • Compensation aligned with strategy Human Resources • Improved mobility and training • Dynamic network management • Improved client satisfaction Clients • Improved commercial organization • Increased commercial focus ORGANIC GROWTH • Paperless workflows IMPACT Operational • Improved IT efficiency Efficiency • Reduced operational costs • Brokerage: targeted growth Specific • Renting: a growth platform for LM Strategies • Additional services • International subsidiaries • Identification of “high potential geographies” External growth • Screening process • Business case and return analysis 9 Results and next key projects: build differentiation by leveraging Group size NEXT KEY PROJECTS: • Lower churn and better talent • More efficient management & Human Resources management in the network organization in Strategic areas • Improved retention and • Structured Commercial Clients accelerated client acquisition Development + Digital Operational • Enhanced quality at reduced costs • Automatization initiatives Efficiency and on-going digitalization of client accounting on all 5 dimensions Specific • Growth captured in Sales • Mass procurement services Strategies Brokerage and service subsidiaries for JPM clients • Perspective: • Opportunities captured along External growth pursue opportunities strict process in fragmented markets 10 Human Resources Achievements OBJECTIVES ACTIONS RESULTS New comp for 600 managers and 1,200 • Alignment of objectives Redefined Compensation sales staff • Profit-sharing spread over twice New profit-sharing scheme for 2012-14 as many employees as in 2011 New processes set-up to feed • 9,000 man.days training per year Improved mobility & manage talent pipeline and training More training for all staff • 76% response rate, 85% satisfied (> benchmark) Yearly measure of staff satisfaction Close management of Strategic areas • 10 to 5 regions Dynamic network with strong growth potential management Ongoing optimizations in strategic areas • Focus on 23 Strategic areas: (leases, management, specialized teams) efficiency and growth HR fundamentals improved, with staff turnover down from 21% to 17% in 3 years 11 Clients Achievements OBJECTIVES ACTIONS RESULTS myFoncia Extranet launched mid-2012 • 330K clients connected Improved client NPS measure by branch, with local satisfaction improvement plans rolled-out over • Early success of NPS pilots 2014-2015 on 10 branches Reinforced resources on newly built units Improved commercial • Market share increase on newly built organization First resources dedicated to client development in LM & JPM • JPM units gained outside newly built Sales & Marketing plan rolled-out Increased commercial in the network • Network mobilized around key actions focus Management of leads through • Leads more systematically tracked new dedicated tool Annual net organic growth improvement over 24 months: +1.4% in JPM and +0.7% in LM 12 Next key project Clients Structured Commercial Development Ambition • Leverage Group size by building a BU dedicated to the capture of new LM & JPM clients (“DevCo”) Ambition • Ensure strong coordination with Branch managers, while letting them focus on client retention • Capture opportunities on specific segments • Reinforce current DevCo staff and improve management • Identify best opportunities to capture leads centrally, especially Key first steps through digital actions • Assess growth opportunities on institutionals & HNWI segments DevCo DevCo – Central teams – Local team Network staff Role of DevCo vs Network staff Lead generation Lead transformation, Feeding local leads to DevCo and qualification with support from network staff + eventual Client Management 13 Clients Digitalization of Foncia on 3 dimensions Capture of new leads More efficient client relationship Internal efficiency Leverage 3 recent acquisitions: Keep investing on myFoncia: Keep digitalizing information • Syndic+ (JPM) More documents and financial flows (internal and with third-parties) • Efficity (Brokerage) Easier e-payments Alerting systems • Primaliance (RE funds) Keep modernizing support functions (e.g. HR systems, Longer term: Optimize costs of online ads expenses, intranet) for brokerage and renting Improve communication with third-party providers Build and manage online communities Improve client communication Modernize internal processes, Provide leads to all businesses and client satisfaction for Foncia, its staff and clients 14 Operational Efficiency Achievements OBJECTIVES ACTIONS RESULTS Client mailings: volumes and costs limited • 2.5M fewer mail items handled by branches Paperless workflows Progressive digitalization of processes, with planned automatization of accounting • -12% client cheques Continuous improvements, Improved IT efficiency with a focus on response times • IT costs -3.5M€ in 2 years Staff and non-staff costs streamlined Branch leases optimized Purchasing initiatives on 90% Reduced operational costs • Over 10M€/year improvement since 2011 of cost base (50M€) HQ staff streamlined Strong contribution to EBITDA growth, while improving service for staff and for clients 15 Specific Strategies Achievements OBJECTIVES ACTIONS RESULTS Sales staff recruited in high-potential • +180 net staff since September 2012 Achieve targeted growth wealthy geographies in sales brokerage • Stabilized revenue/FTE in a tough Focus on Managers: additional FTEs & renting environment and training / coaching / tools provided Insurance & diagnostics: growth of internal Develop additional penetration % and external development • YoY margin growth >10% services RE funds: growth planned through Primaliance acquisition Belgium: critical size reached through Improve performance of Trevi acquisition • Growth route defined for each country International subsidiaries Germany: focus on profitability Switzerland: focus on portfolio stability Ongoing optimization of contribution of non-RRES activities 16 Specific Next key project Strategies Mass procurement services for JPM clients Ambition • Build strong differentiation vs smaller competitors by reducing condo charges • Establish direct contacts with large suppliers, to simplify role of local JPM teams Ambition • Local suppliers: reduce costs and improve reliability & information sharing • Improve Foncia Group margins • Define the right way to communicate to JPM clients about our first results (lifts, natural gas) and our ambition Key first steps • Define priorities ie which condo charges should be tackled next (out of €2Bn total) • Finalize analysis of legal constraints and establish required legal entities 3 1 2 5 providers Natural gas: selected after RFP up to 70M€/year bought on behalf of our clients 12% to 20% cost decrease 4 5 vs 2013 for clients 17 Competitive landscape after the acquisitions of Tagerim and Oralia 1 375 Number of dwellings under management (k units) 970 720 489 291 115 114 105 59 28 Foncia + Tilleul Nexity Citya - Urbania Procivis Square Habitat Loiselet Sergic Akerys Billon Dauchez Further room for consolidation 18 Tagerim successful integration Acquisition of Tagerim in September 2013 • 8th largest RRES player in France in terms of turnover Overview • c. 500 FTEs • 17 branches in France • Over 100,000 dwellings Progressive integration within Foncia’s network