Introduction by the CEO
Between 2002 and 2008, Ordina achieved rapid growth, both organically and via acquisitions in the Benelux. Ordina's market position was clarified and reinforced by focusing on providing added value to major clients in the Finance, Public, Healthcare and Industry markets, confining its core activities to Consulting, IT and Outsourcing, by its local positioning and by pursuing a targeted value strategy.
Our BPO initiative had cast a shadow over these positive developments. Launched as an innovative programme in 2004, we sold it off early 2009 as result of its failure to materialize success. At the same time, market conditions deteriorated rapidly, putting increased pressure on profitability. We therefore had to make every possible effort to keep our people well at work. After the summer, the market showed the first tentative signs of stabilization.
Sound financial basis
We already anticipated on the market weakening in the autumn of 2008. To be able to maintain our flexibility as much as possible, we took swift action and launched a full-scale cost control programme, which included the reduction of 300 employment positions at the start of 2009. These measures have taken a heavy toll on employees and management. However, thanks to the cost reduction programme, which was intensified in response to the uncertain market situation during 2009, we managed to surpass our target of saving at least EUR 15 million in 2009. Focusing on costs will continue to be important in the near future, although we will be loosening the reins carefully in some areas. During the second half of 2009, we strengthened our capital base and renewed and extended our financing facilities. The sum of these measures has created a sound financial basis for a still challenging and unpredictable 2010.
Commercial success
Throughout the year we continued to respond rapidly to changes in the market, sticking close to the fence and positioning ourselves well in order to win new contracts. This active approach towards clients proved very successful and resulted in the signing of a number of major assignments. Particularly in the Public and Healthcare markets, Ordina has won a number of prestigious contracts in specialist areas where we can provide added value. This demonstrates the strength of our position in our extensive network in the Benelux. Our success is certainly due to the great efforts made by our employees and their perseverance, something that they definitely deserve our compliments for.
Sharpened focus
All in all, we can proudly conclude that we achieved relatively good results for 2009. This puts us in a better position to pay attention to our ambitions and long-term goals. We have conducted a market analysis and an opportunity assessment. These reveal that the strategy we have been following for many years has borne fruit and that it continues to have a good chance of success. We are looking to increase the focus of our specialist profile aiming for the business side of our Benelux clients. We will be making every effort in ensuring that this profile becomes even stronger. We are striving towards winning long-term contracts with clients to ensure a continuous revenue flow. At the same time, we are investigating opportunities for setting up our own nearshore operations. This may provide a way of responding to constant pressure on fees and margins in the area of more traditional IT services. Responding quickly to developments in the market will continue to be our motto.
Our employees are and remain instrumental in achieving our ambitions. Retaining highly qualified, driven employees is crucial to our success. By sharpening our focus and strengthening our strategy, our people will be given a stronghold and offered better prospects.
Sustainable and responsible business practices
Our ambition as a quality specialist is to contribute to our clients' goals. Not only in terms of finance and commerce, but also in the area of sustainable and responsible business practices. Such matters are being ingrained in our strategy, our thinking and our actions to an increasing extent and gradually incorporated into our portfolio. This demonstrates our awareness of what our clients and the rest of society expect from us in this area. At the beginning of 2010, we entered into dialogue with a group of relevant stakeholders to discuss how we can be of even better service. It was pleasant to discover that corporate social responsibility is considered a shared task and one that allows experiences to be shared. We will continue this stakeholders' dialogue over the next few years with the primary aim of working together to improve sustainability.
Departure of Hans den Hartog
In January 2010, Hans den Hartog, my colleague on the Management Board, announced that he would be leaving Ordina after the Annual Report for 2009 is published. After being strongly committed to Ordina for 13 years, serving as our CFO and a member of our Management Board for 11 of these years, Hans has decided it is time for him to take on a new challenge. I have worked closely with Hans for the past 11 years and I would like to thank him for his dedication and devotion to Ordina. His responsibilities will be taken over by Bart de Jong, who has been Ordina Nederland's Finance Director since May 2009. Bart's appointment as a member of the Management Board will be scheduled on the agenda at the next Annual General Meeting of Shareholders.
Looking forward
It goes without saying that 2010 will be another challenging year, partly because the economic situation remains uncertain in spite of tentative positive indications. From a financial perspective, we have a strong basis for the next few years. Our balance sheet is sound and costs are under control. Now we need to make the most of the commercial opportunities coming our way and continue to build and develop our profile as a local, specialist service provider.
In this Annual Report we provide you with an in-depth analysis of the opportunities and threats that face us, including a description of how Ordina intends to face them, drawing from its fine-tuned strategy.
Ronald Kasteel
CEO Ordina
