Background
In recent years, Grontmij has almost doubled in size. In 2004, we were a local engineering and project development company with total revenue of € 470 million and 3,600 employees, primarily in the Netherlands (90%), Belgium and Germany. After a strategic choice to divest approximately € 150 million of non-core assets (project development) and to invest in design, engineering and management consultancy Grontmij is now an international design, engineering and management consultancy with total revenue of approximately € 800 million and 8,000 employees working in 150 offices in Europe and in 20 offices worldwide.

This internationalisation and positioning, complemented by acquisitions, is the result of a clear strategic focus. To date, our strategic approach has increased the Group’s value by improving margins, market share and resilience. However, if we are to further improve on this performance and generate further organic growth, we need to adapt strategically to changing market conditions, build a solid crossborder capability and leverage customer knowledge and professional skills. We do this by better anticipating demand, unlocking synergies and leveraging this across geographical borders. Our strategy to 2015 is a logical next phase in the development of Grontmij.

Strategy 2010-2015
Our five-year strategy will focus on increased profitability, organic revenue growth and further expansion by acquisitions. We will leverage our local expertise to allow greater knowledge sharing and cross selling internationally across the business At the core of our strategy is the principle of sustainability by design which is a leading proposition for our customers.

Cross selling , operational excellence and acquisitions to enable future growth
To bolster organic growth and margins, Grontmij will focus on leveraging customer knowledge, referrals, skills and expertise from local markets to ensure better cross-border cooperation. This will also enable us to improve the service level to multinational clients and we expect to benefit from the vendor reduction trend. In addition, we will continue with selective tendering and also focus on selected customers in the most profitable and fastest growing markets; water, energy, transportation and sustainable planning and design.

Grontmij maintains a spread of interests across markets, services and stages in the project value chain. This not only manages the risk associated with fluctuations in external markets but also ensures that clients benefit from the interplay available through our service mix. The Group constantly assesses its portfolio in each business line and region. Based on these assessments we decide whether to start up, improve, acquire or divest activities in specific service areas for a business line.

The broad spread of its activities in mostly mature European economies also means a spread of business risks. Avoiding dependence on one market or single group of clients is an essential component of Grontmij’s strategy. The result is a Group that is less cyclical than it would be if it did not operate in different market sectors and countries.

Profit margins vary by service, depending on the specific market circumstances. On average, the profit margin is higher for services with a substantial impact on the value of the assets of our clients. This particularly applies in the front end of the project chain (consultancy & design, project management) and the back end part (long term asset management contracts).

Our acquisition strategy is unchanged. Any acquisitions will be made only where they have the potential to enhance the position in our (Northwest and Central) European market, or provide for a solid entrance position in chosen fast growing markets (such as Central and Eastern Europe). In addition to existing financial conditions, future acquisitions will need to satisfy the following strategic criteria:

• the further enhancement of the Water & Energy and Transportation & Mobility business lines;

• penetration into new, fast growing regions;

• the acquisition of new competences, technologies or customer groups, provided that this strengthens Grontmij’s market position.