European Outlook / Issue 1

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1 ??????? ??????????? ???? ???? EUROPEAN ISSUE 01 | FEBRUARY 2012 | WWW.EUROPEAN-OUTLOOK.COM reborn Volkswagen’s third incarnation of a motoring classic also this issue FORMULA OF A WORLD WINNER COSWORTH

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Transcript of European Outlook / Issue 1

Page 1: European Outlook / Issue 1

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ISSUE 01 | FEBRUARY 2012 | WWW.EUROPEAN-OUTLOOK.COM

rebornVolkswagen’s third incarnation of a motoring classic

BEETLErebornBEETLEreborn

MAX HAMBURGER

MUSSETT GROUP

BPOSTalso this issue

FORMULA OF A WORLD WINNER

COSWORTH

Page 2: European Outlook / Issue 1

Opportunity in crisisEurope, for want of a better word, is a mess. Growth in the major economies is slow, if not non-existent, output is down and unemployment continues to rise. Fear surrounds us. And with the Greek debt situation facing an all-important deadline, the eurozone could be about to change forever.

Greece aside, British Prime Minister David Cameron recently delivered a scathing assessment of Europe’s failure to promote economic growth and business. He said it was no time for “tinkering” and during his speech to the World Economic Forum in Davos was highly critical of what he saw as anti-competitive Brussels regulations and the flawed framework for the euro. “In Britain we are taking bold steps necessary to get our economy back on track, but my argument is that the need for bold action at European level is equally great,” he said. “Europe’s lack of competitiveness remains its Achilles’ heel.”

In every crisis there is opportunity. A crisis and an opportunity really aren’t that different, are they? Each is a critical point at which events will turn for the better or for the worse. A mishandled opportunity can become a crisis, and a well-managed crisis can become an opportunity. The most important factor is not the challenge itself, but how you handle it.

In this, our launch issue, we look at businesses that have made the most of things. On page 44 we examine the secrets behind the success of motorsport legend Cosworth, while on page 50 we look at how sustainable business has paid off for Max Hamburger. On page 32 Gordon Mussett, CEO of the Mussett Group, tells us about how his firm’s decision to open a new factory will create more space for expansion.

Enjoy the magazine

Ian ArmitageEditor

EdItOrIAl Editor – Ian ArmitageWriters – Colin ChineryJane McCallionrobert MichaelsContributors –Maria McCaffrey

BusInEsssales director - sean BrettAdvertising sales Manager – Andy Ellissales – Andy Williamsresearch manager – Jon Jaffreyresearchers – Eleanor Watsonsandra ParrMarcus GrahamMarie smithluke Ashford Chris Bolderstonesales administrators –Katherine Ellisdaniel George

ACCOuntsFinancial controller – suzanne Welsh

PrOduCtIOn & dEsIGnMagazine design – Optic JuiceProduction manager–Jon CookeImages: Gettynews: AAP, sAPA

dIGItAl & ItHead of digital marketing & development – syed Ahmad

tnt PuBlIsHInG CEO - Kevin EllisChairman - Ken HurstPublisher - tnt Multimedia limited

tnt Multimedia limited,unit 209, 16 Brune street, london E1 7nJ tntmagazine.com

EnquIrIEstelephone: +44 (0) 1603 343367Fax: +44 (0) 1603 [email protected]

suBsCrIPtIOnstelephone: +44 (0) 1603 [email protected]

www.european-outlook.com

Welcome

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CONTENTS

Features

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Welcome n E W S

M O T O R i n G Beetle rebornEuropean Outlook looks at whether German manufacturer Volkswagen got it right with its “new” Beetle

T H E E c O n O M YDealing with trustAs the anti-bonus culture rages, the BBA’s Angela Knight tells us that the banking sector accepts it must do bett er

R E n E W a B l E u KMaria McCaff ery MBE discusses the growth of wind, wave and tidal power in the UK

B P O S T i n T E R n a T i O n a lPeter Somers, CEO of bpost international, discusses the fi rm’s rise to prominence

S O M i n c O RSomincor’s Neves-Corvo mine has been a signifi cant producer of copper since 1989 and in 2006 commenced treating zinc ores

G F R Grup Feroviar Român (GFR) (Romania) is the biggest private rail transport operator in Romania and one of the largest in South Eastern Europe

T H E M u S S E T T G R O u P Mussett is fast-growing and continues to build its reputation as a key supplier to several sectors

u n i P a c S H i P P i n GUnipac Shipping is an international freight-forwarding company established in 1993

W E l l T E c Welltec is an international provider of robotic well solutions for the oil and gas industry

c O S W O R T H Cosworth is the F1 superstar that diversifi ed into fresh areas with outstanding success

M a X H a M B u R G E RThe Max Hamburger Restaurants chain continues to inspire the world with evidence that sustainable business pays off

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newsS P O R T

Australian Open: djokovic wins epic final

World No.1 Novak Djokovic has again won the Australian Open men’s singles title.

The Serb beat Spain’s Rafael Nadal 5-7 6-4 6-2 6-7 (7-5) 7-5 in five hours and 53 minutes in an epic final at Rod Laver Arena.

It is Djokovic’s fifth grand slam title, and his third Australian Open - adding to his 2008 and 2011 victories.

The match was the longest grand slam final ever, breaking the previous record of four hours and 54 minutes for the 1988 US Open final between Pat Cash and Mats Wilander.

It was also the longest match in Australian Open history - longer than Nadal’s five hour, 14 minute semi-final against Fernando Verdasco in 2009.

S P O R T

EPl clubs spend just £60m during transfer window

English Premier League clubs spent around £60 million in the January transfer window, according to analysis by business advisory firm Deloitte, a reduction of 70 percent on the record level of £225 million in January 2011.

Half of the total -- £30 million -- was spent on the last day of European football’s January transfer window. The equivalent deadline day figure in January 2011 was £135 million.

The top spenders in this window were Chelsea, Queens Park Rangers and Newcastle, together contributing over half of the total spending.

“It looks like economically the whole of Europe is becoming a bit more cautious,” Arsenal manager Arsene Wenger said.

Clubs appear to be reining in the lavish spending of recent years in an apparent response to UEFA’s strict new financial controls.

In an initial two-year monitoring period that started in July 2011, UEFA’s rules allow clubs to make a total loss in the first assessment period up to £45 million. Persistent loss-makers can first be barred from the 2014-15 Champions League.

Dan Jones, Partner in the Sports Business Group at Deloitte, commented: “After last year’s bout of big money transfers that drove the record total spend of £225 million, January 2012 has seen a more sober level of spending amongst Premier League clubs.”

E u R O z O n E c R i S i S

Eu states agree to sign ‘fiscal pact’

Germany’s plan for stricter budget discipline was given backing by 25 fellow EU states at the European Union summit in Brussels.

The EU member states will join a ‘fiscal treaty’ to enforce budget discipline.

However, two states – the UK and Czech Republic – refused to sign up. British Prime Minister David Cameron said his government would act if the treaty threatened UK interests.

The goal is much closer co-ordination of budget policy across the EU to prevent excessive debts accumulating.

Germany – which is the eurozone’s biggest lender and most powerful economy - was particularly keen to get a binding treaty adopted to enforce budget rules.

The treaty will empower the European Court of Justice to monitor compliance and impose fines on rule-breakers.

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Eu killing business, Cameron says

British Prime Minister David Cameron has delivered a scathing assessment of Europe’s failure to promote economic growth and business.

He said it was no time for “tinkering”.In a speech to the World Economic Forum in

Davos, Cameron was highly critical of what he saw as anti-competitive Brussels regulations and the flawed framework for the euro.

“In Britain we are taking bold steps necessary to get our economy back on track, but my argument is that the need for bold action at European level is equally great,” he said.

“Europe’s lack of competitiveness remains its Achilles’ heel.”

spain’s unemployment hits 17-year high

Spain’s unemployment rate has reached a massive 22.85 percent, the highest in the industrialised world, as more than half of young people were out of work, official data shows.

The number of unemployed burst through the five-million mark, surging 295,300 to 5.27 million in the last quarter of 2011, the National Statistics Institute report showed.

Even more dramatic, the jobless rate among those aged 16-24 climbed to 51.4 percent at the end of the year from 45.8 percent on September 30.

E u R O z O n E c R i S i S

Eurozone manufacturing falls again

The eurozone’s manufacturing sector contracted for the sixth month in a row in January as a slight upturn in Germany and an easing in the decline of Spain and Italy failed to offset a prolonged contraction in the bloc’s smaller economies.

Markit’s purchasing managers’ index (PMI) for the eurozone, a closely watched survey, rose to 48.8, up from 46.9 in December.

Although eurozone output increased, new order levels declined across the region suggesting it may be some time before the economy returns to solid growth.

A reading below 50 indicated that the sector shrank.

T R a v E l

BAA loses appeal against stansted sale

BAA has lost its appeal against a Competition Commission ruling that it must sell Stansted airport.

The Competition Commission first ruled three years ago that BAA’s dominance in London and Scotland meant it must sell Gatwick, Stansted and either Glasgow or Edinburgh airports.

BAA sold Gatwick and recently agreed to sell Edinburgh, but it has continued to fight the Stansted decision and lodged an appeal with the Competition Appeal Tribunal against the Competition Commission’s requirement to sell the airport.

The appeal tribunal was conducted on 5, 6 and 7 December 2011 and the final decision of the tribunal was announced today, 1 February.

The tribunal concluded BAA was not successful and the original decision made by the Competition Commission to sell Stansted should be upheld.

In response to today’s decision from the Competition Appeal Tribunal BAA said; “We are disappointed by the decision of the Competition Appeal Tribunal which we will now carefully consider before making any further statements.”

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newsB u S i n E S S

Weak European demand hits Philips

Philips Electronics has reported a 160 million euro net loss for the fourth quarter of 2011.

The result compared with a 465 million euro profit a year earlier.

The firm blamed weak European sales and delivery delays in its healthcare sector.

For the whole of 2011, the group made a loss of 1.29 billion euros, compared with a profit of 1.45 billion euros in 2010.

It was Philips’ first annual loss since 2008.“Our fourth quarter results were impacted

by weak European sales, postponement in deliveries of existing orders in our Healthcare sector, and inventory correction actions and other operational issues in our Lighting business,” Frans van Houten, CEO of Royal Philips Electronics, said.

“We are cautious about 2012 given the uncertainty in the global economy, and Europe in particular,” he added. “While we are concerned about the economic environment, all of us at Philips are fully committed to improve our operational performance to achieve our mid-term (2013) financial targets.”

Mr van Houten took the helm at Philips in April and has since issued three profit warnings.

B u S i n E S S

subway to create 6,000 uK and Irish jobs

rBs boss waives controversial bonus

Royal Bank of Scotland’s chief executive Stephen Hester has turned down his controversial bonus, worth nearly £1 million.

Mr Hester was awarded £963,000 in shares last week by the board of RBS.

However, following fierce public outcry and political pressure, he has decided to waive the bonus, which comes on top of his £1.2 million salary.

British Chancellor George Osborne said it was a “sensible and welcome” decision that now lets Mr Hester focus on getting back billions of pounds for the taxpayer.

Hester, who took the helm at RBS in late 2008, had no role in the bank’s near-demise, but his bonus is in the spotlight every year. He waived it for 2009; last year, he took a bonus of £2 million.

Earlier this month, RBS, which is semi-nationalised, announced it would cut 3,500 jobs from its global banking division.

Sandwich chain Subway says it will open 600 new branches in the UK and Irish Republic and create 6,000 jobs over the next three years.

The company has branches in 98 countries, with 1,400 outlets currently in the UK.

Subway’s founder, Fred DeLuca, said: “This month all across Britain we’ve installed our calorie menus,

people can come in and see the exact calories in the sandwiches, and what we do at Subway is we make the sandwiches individually for the people.

“Nothing’s pre-made, so a customer comes down the line, they make their choices, and if they’re interested in healthy eating they can pick exactly what they want.”

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B u S i n E S S

nokia posts q4 loss

Mobile phone maker Nokia has posted a fourth quarter net loss of 1.07 billion euros, with sales slumping 21 percent even as the company’s first Windows smartphones hit markets in Europe and Asia.

The loss compares with a profit of 745 million euros in the same period a year earlier.

Nokia said net revenue - including both its mobile phones and its network divisions - fell from 12.6 billion euros in the fourth quarter of 2010 to 10 billion euros, with smartphone sales plunging 23 percent.

Nokia has lost its once-dominant position in the global mobile phone market, with Android phones and iPhones overtaking it in the growing smartphone segment.

The Finnish company is attempting a comeback with phones using Microsoft’s Windows software, a struggle that Nokia

CEO Stephen Elop characterised as a “war of ecosystems”.

He said Nokia has sold “well over” one million such devices since the launch of the Lumia line in the fourth quarter, in line with company expectations.

Including other models, Nokia sold 19 million smartphones in the quarter.

B u S i n E S S

nestlé profits up, company seeks new growth

Swiss food and drinks giant Nestlé SA has reported that its 2011 net profit rose by eight percent to 9.5 billion Swiss francs, if the disposal of eye-care company Alcon is stripped out of the comparison.

However, the world’s largest food group, which makes brands such as Nescafe, Perrier, Maggi and Carnation, issued its full-year statement with a warning that 2012 would be just as difficult as previous years due to continued economic uncertainties and volatility.

Paul Bulcke, Nestlé CEO, said: “We delivered good performance, top and bottom line, in both emerging and developed markets in 2011. It was a challenging year, and we do not expect 2012 to be any easier.”

The company said it expected organic sales growth over the coming year would likely come in lower but still at its company target of between five and six percent.

Europe’s top banks being watched by Moody’s

Moody’s says it is reviewing some 114 European banks and financial groups for a possible ratings downgrade because of the eurozone debt crisis.

Germany’s Deutsche Bank and Commerzbank are among two of the largest groups named, alongside Britain’s HSBC and Royal Bank of Scotland, ING of the Netherlands, Spain’s Santander and Italy’s Unicredit.

France’s BNP Paribas, Societe Generale, Credit Agricole and Natixis are among others that will be reviewed, Moody’s added in a statement.

In all, Moody’s, one of the top three ratings agencies, put 24 groups in Italy on review, followed by 21 in Spain, 10 in France, nine in Britain, eight in Austria and eight in Denmark, seven in Germany, and six each in Portugal and the Netherlands.

It said it was also looking at five companies in Sweden, four in Slovenia, two in Switzerland and one each in Finland, Norway, Belgium and Luxembourg.

Page 8: European Outlook / Issue 1

Every year brings new uncertainties to the car business. 2012 will be no different. Will buyers be looking for big trucks or small cars, import brands or domestics, petrol-power or electricity?

Whatever consumers are after, German manufacturer Volkswagen wants to be the number-one. Its “Strategy 2018” is to position the Group as “a global economic and environmental leader” among automobile manufacturers.

And innovation plays an important part in that.In 2011, the auto giant unveiled the third incarnation

of one of the world’s best-selling cars, the Beetle.The redesign is a sportier version of the iconic Bug,

aimed at men. Gone are many of the features of the previous design, and Volkswagen claims it is the ‘raciest’ Beetle yet.

reborn

European Outlook looks at whether

Volkswagen got it right with its “new” Beetle.

By Ian Armitage

Beetle

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Page 9: European Outlook / Issue 1

“The Beetle has enjoyed an incomparable success story,” says André Tietje of product marketing at the Volkswagen brand, who tells European Business Outlook that a lot of att ention has been paid to give the model a more “masculine” facade. “To this day it is one of the world’s three best-selling cars ever. Its unique silhouett e is recognised all over the globe. The new Beetle projects the original car into the future; it carries its genes and continues to authentically develop

them. Contemporary everyday suitability, modern technology and iconic design thus come together and also create a new sporting character.”

Lower, wider and longer than its predecessor, the model looks more like a coupe, and also features a turbocharged version. However, it has retained much of the character of its predecessor.

It is only the second time the Beetle has been redesigned since it was created in 1938.

About 22 million were built over the following 60 years; only the Volkswagen Golf and the Toyota Corolla marquees have sold more.

The New Beetle arrived in 1998. The third-generation Beetle has been on

sale in Europe since the autumn.“Consumer reactions were – as expected –

extremely positive,” Tietje says. “The Beetle is Volkswagen’s iconic model and engenders empathy across all generations. It combines the emotional legacy of the ‘original VW’ with the future of Volkswagen. This emotional aspect benefi ts the

whole brand.“We wanted

the vehicle to pay homage to the original and this we achieved by paying considerable att ention to the original model and interpreting these into the modern design,” he continues. “The distinctive lines have been

clearly emphasised and the car has gained a required more serious air. The proportions, in particular, have become sportier; the car is lower, wider and has an appreciably larger wheel diameter than its predecessors, with the 21st century Beetle, thus appealing to younger, trend-sett ing customers. Coupled with its outstanding product features the Beetle is no longer a niche vehicle, but att ractive to a broad mass of customers, both emotionally and in terms of everyday use – all at an incredibly att ractive price.

“to this day it is one of the world’s three best-selling cars ever. Its unique silhouette is recognised all over the globe”

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VOlKSwAgEN

Page 10: European Outlook / Issue 1

“The style follows the DNA of the brand. The more masculine impression is created primarily by a wider track and lower silhouett e. It again bears the silhouett e of the original Beetle and the side surfaces are more strongly vaulted. Finally, you can see the Volkswagen look in the typical round headlight and the rear light clusters.

“Inside, we had the freedom to consistently implement unconventional ideas. The instrument panel is just as unmistakable as the Beetle itself – with large-format elements in body colour and an instrument cluster with a central, extra large round instrument. The windscreen is set closer to the driver, enhancing internal dimensions, and it makes the interior more spacious and comfortable for all. And, of course, every detail bears our typically high level of quality!”

The vehicle, which features a sound system from the legendary Fender brand, is produced in Mexico, as was its predecessor.

“The Beetle is one of the new, att ractive vehicles with which

Volkswagen wants to win market shares throughout the world, and to continue the Group’s very good progress made in 2011,” Tietje says.

Volkswagen expects 2012 to be challenging, but the Group maintains its Strategy 2018 and the goal to become the world’s best automaker by sett ing economic and ecological benchmarks. With an eye on the global economic developments, it will put faith in its strengths: worldwide presence, fl exibility in sales and production, and strict cost control, the company told European Outlook.

“With our strong dealer network around the world, Volkswagen is present in over 150 markets. We adapt our sales strategies individually to the diff erent structures and conditions of the markets and regions. But for us, vehicle sales are only one indicator of succes: Environmentally-friend products, satisfi ed customers, and happy employees are as important to us as sales rankings and profi tability. We are making good progress in all areas,” Volkswagen said.

“With our strong dealer network around the world, Volkswagen is present in over 150 markets. We adapt our sales strategies individually to the different structures and conditions of the markets and region”

VOlKSwAgEN

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trustBRITISH BANKERS’ ASSOCIATION

As the anti-bonus culture rages and the UK Government seeks to soothe

public anger over bank bailouts by bolstering regulation after the

worst fi nancial crisis since the Great Depression, British Bankers’

Association’s Angela Knight tells European Outlook that the industry

accepts it must do bett er.

By Colin Chinery

Dealing}with

RBS’s Stephen Hester waives looming Pariah status and that £1 million bonus

and the tumbrel legions claim Bonnie Bank predecessor Fred Goodwin’s knighthood.

But a small coin of consolation for Britain’s brand-challenged banking sector: a survey of airline passengers reveals the overweight to be eight times more unpopular travel companions than politicians and bankers. Did someone mention overweight politicians and bankers?

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“The near-collapse of the British banking system still generates deep feelings of anger and cries for retribution. And the anger at the terrible mistakes of the banking industry and failure of those who regulated it will long remain – and rightly so.”

A quote from an Occupy London protest camper? No, Tory Chancellor George Osborne addressing the House of Commons.

Public respect for Big Bankers is as routine as a good opinion of Costa Concordia’s Captain Schett ino. “Of course trust has fallen,” says British Bankers’ Association Executive Director, Angela Knight. “That’s why we know full well that restoring that trust is priority number one. And number two is that it will take some time to do so.

“Trust is something that is much quicker to destroy than it is to build up. And as an industry we recognise we’ve got a long period of time of doing our knitt ing well before we will be able properly to restore trust.”

Knight is an ex-Tory MP and economic secretary to the Treasury, with a formidable reputation as Bankers Batt ler in their darkest hour.

Does she sympathise with the remarks of Bank of England Governor Mervyn King that banks may damage their reputations with excessive compensation at a time when their share-price performance has “hardly been stellar”?

“I don’t have a particular response to one comment or another. I think there’s a serious reaction to the big pay question.

“There are around half a million working in the UK banking industry; large and small banks, domestic banks, retail banks, international, wholesale. Of those, there’s probably 2,500 at the most where the pay is high - and they now have that pay regulated by the Financial Services Authority.

“The majority of bonuses are paid in shares locked away for several years against same performance criteria and subject to claw-back. It’s a fact that it’s a tougher regime here in the UK than anywhere else in the world. And it applies both to banks that got into diffi culties and those that didn’t.”

Higher pay says Knight, is to be found overwhelmingly in banks that are international, and that of all G20 countries Britain is the one taking the issue seriously.

“It’s not the others. And I’m not entirely sure what one can do for a large international industry operating out of the UK in making them adopt standards completely diff erent from those where they are headquartered, standards very diff erent from other countries where they operate. It’s a diffi cult question and there’s no easy answer.”

She hits back at the perception that fat cat high pay “goes to all bankers, all bankers are British and all British banks got into trouble. That story doesn’t connect up. And at some point we will have to decide whether we want an international industry here with the jobs and benefi ts to the economy that it brings, or whether we don’t. We have a world-class banking industry working out of the UK and I hope we support it rather than see it diminished.”

She refutes too accusations that the banks lobbied against calls for the separation of their retail and investment businesses, a key demand subsequently endorsed in the Vickers’ Banking report and accepted by the Government.

“It’s not the others. And I’m not entirely sure what one can do for a large international industry operating out of the UK in making them adopt standards completely diff erent from those where they are headquartered, standards very diff erent from other countries where they operate. It’s a diffi cult question and there’s no easy answer.”

She hits back at the perception that fat cat high pay “goes to all bankers, all bankers are British and all British banks got into trouble. That story doesn’t connect up. And at some point we will have to decide whether we want an international industry here with the jobs and benefi ts to the economy that it brings, or whether we don’t. We have a world-class banking industry working out of the UK and I hope we support it rather than see it diminished.”

She refutes too accusations that the banks lobbied against calls for the separation of their retail and investment businesses, a key demand subsequently endorsed in the Vickers’ Banking report and accepted by the Government.

Stephen Hester, RBS

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“The COs of the banks have all accepted the principle of the Vickers recommendation. I’ve heard it said time and again that we fiercely objected. I know what happened, and while there are – and remain – a number of critical areas that need to be looked at - the direction of Vickers was publically accepted by the heads of the major banks.”

The consultations that will follow are essential, says Knight. “How a ring fence works in one bank will be different to a ring fence in another. Banks themselves are significantly different. There are other questions. What do you do about private banking which straddles the ring fence? We have one of the largest centres for international private wealth management in the world, and yet the ring fence as drawn at the moment constrains you from taking on clients outside the European economic area.

And what about financing SMEs? “SMEs also have requirements either side of the ring fence. So there’s a lot in the detail that needs to be looked at, and the location of the ring fence is an important aspect.”

SMEs are prominent among businesses complaining that banks are stone-walling loans and stifling expansion and recovery. Knight, who took 16 ‘Better Business Finance’ road shows around Britain late last year when businesses met with banks, points to a study of 5,000 businesses by market research firm BDRC Continental. This showed more than half of SMEs who applied for bank credit in the 12 months up till mid 2011 had been successful. “There are 4.5 million businesses out there, and at any one time around three quarters not only are not borrowing but don’t want to borrow. Of those that are borrowing or seeking finance, the overwhelming majority get it. If you look at the BDR Continental results you find that in the universe of small businesses, it’s only about two to 2.5 percent that get turned down. Now there may well be a big chunk deterred from going for finance because they think we are not lending, and we accept we must improve the experience of some. So getting the confidence up for businesses to come through the door is very important.

“Some of the greatest damage that we see is by people saying they have seen reports saying banks aren’t lending so why bother? We have to overturn that.”

When the crisis was at its height starting in 2008 and 2009, some major business lending banks hit the wall and there was a hiatus, says Knight. “We don’t pretend differently.

“You then had a recession. And in a recession businesses pay back their loan and deposit their money. So what we are seeing are higher deposits from businesses of all sizes than we have seen for 25 years.

“There’s a huge amount of business money sitting inside the banking industry. We can get out of the door new loans and overdrafts at a good level, but what we can’t do is stop people paying back. And the pay backs are now very high.”

The biggest issue for the banking industry is the same as for the country, says Knight - “the absence of growth. As a brand, banking has suffered very badly from the problems of the few.

“BBA has over two hundred banks as members, 50 nationalities; all the major banks of Europe, USA, Canada, China and others operate here. Why? Because this is a big international centre.

“The brand as a whole is tarnished by the problems of the few. We know that. So what we have to do is to perform well, get close to our customers, do our knitting well; not pretend that we can do what we can’t do. And always to be very mindful of what it is that our customers seek, be close and deal with them well.”

BRITISH BANKERS’ ASSOCIATION

“How a ring fence works in one bank will be different to a ring fence in another. Banks themselves are significantly different.”

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RenewableUK’s Maria McCaff ery

MBE discusses the growth of wind, wave and tidal

power in the UK.

The UK is well positioned to be at the front of the green energy revolution. We

have the best wind resource in Europe, the strongest tidal streams and a very long wave-washed coastline. While the demand for green energy trails our growing awareness of our impact on the climate, Britain’s wind industry has a long history. The world’s fi rst wind turbine used to generate electricity was built in Maykirk

Powerme up

in Scotland in 1887. However, the fi rst commercial wind farm in the UK, at Delabole in Cornwall, was not constructed until 1991, as part of a broader drive away from fossil fuels. Since then, the UK’s wind generation capacity has expanded to 5,700MW, and supplies between 4-5 percent of the UK’s total annual demand.

This expansion has driven a rebirth in British manufacturing. At Chepstow in Wales and Campbelltown in Scotland, factories are producing the

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RENEwABlEuK

towers necessary for megawatt -scale wind turbines. In Kidsgrove, the bindings necessary for next-generation direct-drive turbines are produced. Undersea connection cables for off shore projects are manufactured in Hartlepool.

Britain is a world leader in off shore wind and wave and tidal power development, and we plan to cement that lead over the next decade. Carefully scoped areas of the North Sea have been earmarked for the third round of off shore wind farms, with the potential to deliver up to 40GW of green electricity – enough to meet a third of our annual energy demand. A series of multinational corporations have announced their intention to invest in UK-based wind turbine manufacturing plants, including Siemens, Vestas, Gamesa, GE, Mitsubishi and Alstom.

This comes in the wake of the construction of the biggest off shore wind farm in the world – Thanet, off the Kent coast, with a generation capacity of 300MW. This record will be broken in short order – construction of the fi rst 630MW phase of the London Array is scheduled to be completed at the end of 2012. By 2020, the Government expects 18GW of off shore wind farms to be operational.

Power from the waves and tides is at an earlier stage of commercial development but is equally exciting. The UK is at the forefront of tidal energy deployment, with devices such as the 1.2MW SeaGen device installed in Strangford Lough since 2008. The latest innovative 0.8MW Oyster wave power device was installed off the coast of Orkney this August. The Government has recently announced a viable level of revenue support for both wave and tidal technology, and we look forward to hundreds of megawatt s-worth of projects being installed by 2020.

Employment across the sector has doubled since 2007, despite the recession. Demand for green energy continues to rise, and we anticipate that wind, wave & tidal power could employ as many as 100,000 people by 2020.

Britain’s natural resources make it an excellent place to invest in green energy. The sector is still rapidly expanding, and opportunities to take part in the energy revolution are both numerous and diverse.

“Britain is a world leader in offshore wind and wave and tidal power development, and we plan to cement that lead over the next decade”

Maria McCaff ery

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You’vegot mail

Page 17: European Outlook / Issue 1

Peter Somers, CEO of Belgian cross-border mail carrier bpost international, tells European Outlook about the company’s rise to prominence over the past 10 years and how shifting commerce patterns are affecting his business.

By Jane McCallion

17

Bpost international is a specialist international business mail service provider operating in Europe,

North America and Asia. It is a fully owned subsidiary of bpost – the Belgian national postal service.

bpost international is currently headed up by CEO Peter Somers, who has been in place since 2002. When he joined, the company was under-performing; he and his team undertook a huge transformation over a 10-year period. “The work to turn around the company was completed in four phases. Phase one took place between 2002 and 2004 and looked getting the basics right – improving service levels, streamlining internal processes and looking at our

BpOST INTERNATIONAl

pricing strategies. By the end of this phase, we had already begun to win back volumes.”

The decision was taken to focus on the Belgian part of the company’s operation. “The Belgian cross-border mail market has been open for a very long time. We had competition from Royal Mail, Deutsche Post, La Poste and others. However, we were not active in their respective countries and for a whole two years we were in a situation of one-way competition. I wanted to change that and that became the basis for phase two.”

Between 2005 and 2006, bpost international began to sell its cross-border mail products in its neighbouring countries: UK, the Netherlands, France,

Page 18: European Outlook / Issue 1

18

BpOST INTERNATIONAl

Germany and Luxemburg. “In this second phase, we only focused on these fi ve markets, as we were easily able to bring the mail to our main sorting offi ce in Brussels, which is central not only to Belgium, but also to our neighbouring countries.” The successful completion of this phase once again raised throughput volumes, and also gained bpost international a number of long-term customers.

This success was followed by a decision to penetrate further into Europe, as part of phase four, and expanded into a further fi ve Western European countries, bringing the total today up to 10. “At this time we also moved into the biggest mail market in the world, which is of course the USA,” Somers says.

bpost international’s initial approach to the American market was from a wholesale point of view. Then, at the end of 2009, the opportunity arose to acquire a local company.

“We as bpost international focus on business mail, of course, but that is a market that is in slow decline. However, on the other hand, the parcel market for e-commerce customers is booming”

“The purchase of MSI (Mail Services International), which is based in Washington Dulles International Airport, allowed us to become more active in the American market, particularly on the retail side. It also gave us direct access to the American customers who ship volumes abroad,” explains Somers. “Another advantage of this acquisition was that MSI also has sorting offi ces in Chicago and Toronto, which we now own and can use to handle the mail volumes coming from and going to the United States.

“The fi nal phase – phase four – is the one that we are in currently and lasts from 2010 until 2012,” Somers adds.

Page 19: European Outlook / Issue 1

M9A63095OCT11 Ck•G5-51

Bi_MASKARGO11173-EO MagAD_X3.ai_27/10/11_1130pmBLACKYELLOWMAGENTACYAN

Page 20: European Outlook / Issue 1

20

Having successfully grown its European business and penetrated the American market, bpost international set its sights on Asia. Until this point, bpost international had been handling international mail, but at the end of phase three the decision was taken to move into the parcel and e-commerce market. “This is now a fully fl edged part of our products portfolio, including not just lightweight packets but also tracked parcels.”

What is special about Asia, in this respect, is that it is the ‘hub’ of e-commerce, which relies on global parcel shipping to function.

“We as bpost international focus on business mail, of course, but that is a market that is in slow decline. However, on the other hand, the parcel market for e-commerce customers

is booming; on average it is growing 10 percent year on year in Europe and even more in the USA and Asia.”

In October 2011, the company acquired two local companies, one in Hong Kong and the other in Singapore, consolidating its position in Asia and in what it calls ‘the triangle’. “The triangle is basically these three continents,” says Somers. “While it’s true that we don’t cover the entire world, by covering Europe, Asia and North America we are present in the three most important international mail delivery economies.”

The company also intends to open an offi ce in Beijing. “We want to support Chinese e-traders to sell their products abroad and really, that’s at the heart of our strategy,” says Somers. “We want customers

BpOST INTERNATIONAl

Page 21: European Outlook / Issue 1

On Time Delivery

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in Europe, Asia and America, particularly e-traders, to know that we can off er them a safe and secure logistical supply chain system. They can see all their parcels tracked and traced, customs cleared and secure all the way to its recipient.”

While the past 10 years have been a success, there are still challenges for bpost international to overcome. “One challenge is what’s happening in the international markets in terms of capacity on airlines. As an international and cross-border carrier, we do use space to ship our volumes and there are always problems coming out of Asia and Europe. And in the coming part of the year, in the run-up to Christmas, the shortages are even more pronounced,” says Somers, “But we have a lot of specialists working on this so we always

fi nd the right solution.” Airline security is also a problem, particularly since the Yemen bomb in 2010. “That had a serious impact on the way we ship volumes, particularly to the USA. So that is another challenge we have to overcome.”

Somers is very optimistic about the future for bpost international. “We came up from zero in a world full of competition from much bigger companies. This is starting so in fi ve years time, I see us as one of the top fi ve players in the Asian cross-border market for e-commerce. If we can achieve that, it will be great and I think that we are able to and capable of doing it.”

“In five years time, I see us as one of the top five players in the Asian cross-border market“

21

Page 22: European Outlook / Issue 1

Make mine

22

Neves-Corvo is an underground mine, 100 km north of Faro, Portugal, in the western

part of the Iberian Pyrite Belt. The mine has been a signifi cant producer of copper since 1989 and in 2006 commenced treating zinc

ores. European Outlook investigates a huge 164-million euro expansion plan to extend

the project’s life to at least 2026.

By Robert Michaels

a}larger}one}Make mine a}larger}one}Make mine

Somincor S.A. is the wholly owned subsidiary of Lundin Mining, a mining company listed in

Canada and Sweden, which operates the Neves-Corvo copper- zinc mine 100 km north of Faro, Portugal, in the western part of the Iberian Pyrite Belt.

It is one of Portugal’s most important exporters, a signifi cant contributor to its economy and a major local employer.

“We play a signifi cant part,” says Trezer Manso Giant, Somincor’s Director General.

Lundin Mining is a diversifi ed base metals mining company with operations around the world, producing copper, zinc, lead and nickel.

Page 23: European Outlook / Issue 1

23

SOmINCOR S.A.

“Copper production for the quarter from our own operations exceeded expectations while zinc and lead approximated latest guidance”

In January, the miner announced that copper production rose 10 percent in the fourth quarter of 2011, helped partly by strong results at its Neves-Corvo mine, just 15 kilometres from Castro Verde.

The company produced 27,488 t of copper in the quarter, up from the 24,908 t a year ago. Zinc production rose 15 percent to 27,053 t.

“Copper production for the quarter from our own operations exceeded expectations while zinc and lead approximated latest guidance,” Lundin Chief Executive Paul Conibear said in a statement.

Full-year copper production fell fi ve percent to 75 877 t,

mainly due to production issues at Neves-Corvo earlier in 2011.

The company’s zinc plant was used to process copper ore in the fourth quarter, which helped make up for lost production.

“Somincor has discovered massive reserves of zinc in its Neves-Corvo mine,” Trezer Manso Giant tells European Outlook.

He says there are a number of “optimization and expansion” opportunities to develop the reserves and expand the mine’s production capacity over the coming years.

“The mine has been a signifi cant producer of copper since 1989 and in 2006 commenced treating zinc ores,” he says. “A new zinc expansion

Page 24: European Outlook / Issue 1

24

SOmINCOR S.A.

project was completed in July 2011. The expanded plant has the fl exibility to process zinc or copper ores.”

Somincor is a major producer of copper and zinc. The company was launched in 1980, starting production in 1989, and during the fi rst fi ve years of mining, Neves-Corvo produced around 160,000 t a year of copper metal contained in concentrates, from ore grades of over 10 percent copper, making it the richest copper mine in the world.

Today it is still considered to be a very rich copper mine.

Neves-Corvo currently produces around 70,000 t a year of copper metal in concentrates from copper ore grades and 4,500 t a year of zinc in concentrates from zinc ores.

It is considered to remain under-explored.

“There is more to do,” says Trezer Manso Giant.

In September 2011, Lundin Mining announced a plan to expand the mine at a cost of 164-million euros.

The Lombador Phase 1 project would extend the life of the copper-and-zinc mine to at least 2026 and serve as a platform for further extensions, the company said.

About neves-CorvoNeves-Corvo is an underground mine, 100 km north of Faro, Portugal, in the western part of the Iberian Pyrite Belt. The mine has been a signifi cant producer of copper since 1989 and in 2006 commenced treating zinc ores. The facilities consist of a shaft with up to 4.5 mtpa hoisting capacity for ore and waste, a copper plant with 2.5 mtpa processing capacity and a newly expanded zinc plant with 1 mtpa processing capacity. The processing of zinc-rich ores was suspended in November 2008 pending an improvement in zinc prices and the zinc facility was converted to treat copper ore. Zinc production was restarted at a limited rate in 2010 and a new zinc expansion project was completed in July 2011. The expanded plant has the fl exibility to process zinc or copper ores.

The mine employs both bench-and-fi ll and drift-and-fi ll stoping methods.

The ore treatment is carried out by conventional crushing, fl otation, grinding, thickening and fi ltration processes.

“the mine has been a significant producer of copper since 1989 and in 2006 commenced treating zinc ores. A new zinc expansion project was completed in July 2011. the expanded plant has the flexibility to process zinc or copper ores”

Page 25: European Outlook / Issue 1
Page 26: European Outlook / Issue 1

SOmINCOR S.A.

In addition to a mine deepening, the project calls for the expansion of the existing zinc plant ore processing capacity.

“This study confirms the company’s view that the Lombador Phase 1 project can be developed into a successful and profitable expansion to the existing operations,” Lundin chief executive Paul Conibear said in a statement.

“The initial phase of Lombador development enables zinc production to ramp up taking advantage of the expected strong zinc markets evolving over the next several years.”

The facilities at Neves-Corvo consist of a shaft with up to 4.5 mtpa hoisting capacity for ore and waste, a copper plant with 2.5 mtpa processing capacity and a newly expanded zinc plant with 1 mtpa processing capacity.

To learn more visit www.lundinmining.com.

neves-Corvo Optimization and Expansion Opportunities}} Neves-Corvo}Copper}Plant: The current higher cutoff grade production plan leaves spare capacity in the copper plant, which could be used to treat lower-grade ore, should copper prices rise above current levels.}} Neves-Corvo}Zinc}Plant}Expansion:}A further expansion of the existing zinc capacity to 2.5 Mtpa ore feed capacity (to a peak 150,000tpa zinc production averaging 112,000tpa) has been evaluated as described in the Company’s Lombador Phase One feasibility study press release of September 2011. While the SAG mill has been ordered and certain other surface critical path items are still advancing, less schedule sensitive expenditures related to the zinc plant expansion have been put on hold pending completion of the overall Neves-Corvo Underground Materials Handling Study.}} Lombador}Zinc/Copper/Lead}Project: The Lombador Phase One Feasibility Study has been completed. The study shows that Lombador Phase 1 can be developed as a profitable and value accretive extension to the Neves-Corvo mine.}} Neves-Corvo}Future}Underground}Materials}Handling}Study: A conceptual level study identified and evaluated the underground materials handling and access options necessary to pursue the exploitation of the deeper Lombador copper/zinc resources (Phase 2) as well as the Semblana copper deposit which are adjacent to the Company’s Neves-Corvo mine. The Study indicated two preferred options:

} a new rock-hoisting and man-riding shaft approximately 1,200 m deep, located to the north-east of the existing mine surface facilities, situated between the Semblana and Lombador mineralization (the “Shaft Option”).

} Anew decline from the existing plant area equipped with a conveyer system and man and material access facilities (the “Decline Option”). The Decline Option consists of a proposed two-leg decline driven by a high speed tunnel boring machine and would be aligned to pass close to and underneath the Semblana deposit and then on to deeper parts of the Lombador resource, reaching a similar ultimate depth as the Shaft Option. Studies are advancing to refine comparisons between the Shaft and Decline Options to select a single preferred option for subsequent feasibility level study.

}} Related}Development}Plans: In parallel to ongoing study work and to fast track the schedule for accessing the Semblana area, the Company has commenced planning and budgeting for development of an access ramp to the Semblana Deposit from the Zambujal orebody. Subject to investment approvals, the objective of the ramp development is accessing an intermediate level about 750 m below surface from which further exploration and infill drilling can be carried out. Subject to this drilling, further design and study results, this ramp will continue to approximately 950 m depth, which is the conceptual design level of a main haulage way for Semblana. This access ramp from Zambujal would be utilized with either the Shaft or Decline Options.

26

Page 27: European Outlook / Issue 1

Q&A with Barloworld STETEuropean Outlook learns more about Barloworld STET, CAT’s dealer in Portugal and Cape Verde.

Q: Who are Barloworld STET?

Barloworld STET is the CAT dealer for Portugal and Cape Verde and we are proud to be part of a global group named Barloworld. Last year Barloworld STET celebrated the 50th anniversary as a Caterpillar dealer.

Barloworld STET stands for quality, reliability and partnership and our strength is customer support. Customer needs are the major driver of our business. We constantly seek for the best solution for our customer regardless of the challenges we face. The constant challenge to fi nd the most adequate solution is what makes the difference.

We are proud to be a Caterpillar dealer. It is common to say that Barloworld STET employees have yellow blood.

Q: How is Barloworld STET performing?

Barloworld STET predominantly operates in Portugal and it is a known fact that our country is facing diffi cult and challenging times. Despite that, in 2011 we delivered better profi tability than previous year. Being part of global group like Barloworld gives us a major fi nancial advantage.

Highlights for the last year relate to very important partnerships created with key accounts, both for domestic and the African markets.

As it is expected for any Caterpillar dealer, we were, in 2011, the market leader in the segments we operate in.

Q: Where has Barloworld STET been most successful in the last year?

Barloworld STET was very successful in strategic niche markets. The success achieved in the quarry market was very important for us since this market was less affected by the construction crisis. Of course, we are also very happy with the good results achieved in mining boosted by the excellent partnership we have with Somincor.

Barloworld Power Systems results were remarkable also. The results were a historical record and we are recognized as best in class dealer in this segment.

Q: Customers rave about your 360º solution. Tell us more about it…

360º is a good way to describe our broad solution offering. Barloworld STET is able to offer to each customer a range of solutions that includes fi nancing, product support, warranty, technology and product diversity.

Finance is a good example of success in the 360º strategy. Over 90 percent of our equipment sales are fi nanced through CAT Financial, one of our most important partners.

Q: Who is your ideal customer?

There is no ideal customer. All customers are important for us and we need to be important for all of them. You need to listen to your customers since that’s the best way to assure you are offering what they really need. Customer satisfaction surveys are a key driver for our strategic action plans.

Q: If you met a Genie who offered to have all of Barloworld STET’s dreams come true, in order of priority, what would they be?

Without any order of priority I wish to have the most satisfi ed customers, employees, shareholders and principals.

Q: What do you think is the key to Barloworld STET’s success?

Our customers and employees are our most important and valuable assets. The secret to our success is the ability to manage these assets well.

Q: Finally, do you have anything to add?

We want to congratulate Somincor for its results, appreciate the business relationship we have and wish Somincor a long and profi table life.

27

Vasco Santos

Page 28: European Outlook / Issue 1

28

Grup Feroviar Român (GFR) (Romania) is

the biggest private rail transport operator in Romania and one of the largest in South

Eastern Europe.

By Ian Armitage

On the

track

Page 29: European Outlook / Issue 1

29

Established in 2001, Grup Feroviar Român (GFR) (Romania) has become the largest private sector open access operator in

Romania. As well as running freight services, it provides traction and infrastructure maintenance services and off ers locomotives and wagons for hire to other operators. GFR also has interests in the Bulgarian Railway Company AD and in 2010, GFR, part of the Grampet Group, acquired the assets and interests of Rompetrol Logistics (RPL).

“This transaction strengthens GFR’s leadership position in its core business market, the transport of oil,” said Gruia Stoica, Grampet Group President, in a statement. “At the same time, taking railway activities of Rompetrol Group will have a positive impact on operators’ activities in Bulgaria and Hungary. It’s a step you do to become largest rail operator in South Eastern Europe.”

GFR, Grampet Group’s “most important project”, operates across a major part of the Romanian rail network and has established collaborative arrangements with neighbouring railway companies in Bulgaria, Hungary, Serbia and Ukraine.

It has been especially active in the petroleum products and aggregates sectors, but also provides train marshalling, shunting and terminal operations services. In 2010 GFR commenced cross-border operations into Moldova.

gRup FEROVIAR ROmÂN (gFR)

GFr has concluded collaboration agreements with:

} BDZ (the Bulgarian national rail freight operator)

} ZS (the Serbian Railways)

} UZ (the Ukrainian Railways)

} CFM (the Moldavian Railways)

} Private rail freight transport operators from Bulgaria and Hungary.

last year, the company transported approximately 9.25 million net tons, reaching a turnover of 125 million euros

Page 30: European Outlook / Issue 1

30

gRup FEROVIAR ROmÂN (gFR)

“Grup Feroviar Român has elaborated its development principles in compliance with all the conditions of compatibility and interoperability with the European railway system,” information the company sent European Outlook says. “GFR is an affi liated member of the International Union of Railways (UIC), a member of CIT (International Transport Committ ee) and CER (European Railway Committ ee), and an associated member of the Organization for the Collaboration of Railways (OCCF),” it adds.

GFR is a national leader in the transportation of petroleum products, with a 90 percent market share. It has also extended its activity in the transport of other goods: coal, aggregates, broken stone, slag, cement, and cereals, to name a few. GFR estimates, based on the existing contracts, market

} OMV PETROM

} LUKOIL

} ROMPETROL

} CONPET

} LAFARGE

} HOLCIM

} ARCELOR MITTAL

} GEFCO

} DACIA RENAULT

Customers The most important customers of GFR

“GFr’s main areas of business are internal and international rail freight transport, railway shunting on industrial platforms”

Page 31: European Outlook / Issue 1

THE FIRST CHOICE IN RAILCAR RENTAL

With over 60,000 wagons and a parc that meets the needs of specialized industries, the Ermewa Group is one of the most important rail equipment hire companies in Europe.

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31

share in rail freight transport will increase 33 percent. Its most important customers are Petrom OMV,

Conpet, Petrotel Lukoil, Gefco, Lafarge, Holcim, the National Coal Company, Butan Gas and ArcelorMitt al.

“Last year, the company transported approximately 9.25 million net tons, reaching a turnover of 125 million euro,” the company told us.

GFR owns a fl eet of 260 locomotives and 8.000 wagons, but it manages a fl eet of 10,000 wagons, including traction for private wagons.

GFR is also the majority shareholder of Rolling Stock Company, which owns 80 locomotives and 6,000 wagons. “They can be leased to GFR both for transport operations during peak periods of transport demand and in case of contracting new transport routes,” the company says.

“GFR’s main areas of business are internal and international rail freight transport, railway shunting on industrial platforms, revision and current maintenance of freight locomotives and wagons, management of non-interoperable public railway lines, current maintenance and repair of railways lines, railway logistics, specialised assistance in the fi eld of railway transport and rental of wagons and locomotives,” an industry expert told European Outlook in 2011.

To learn more about the company visit www.gfr.ro.

GFr is an affiliated member of the International union of railways (uIC)

Page 32: European Outlook / Issue 1

The Mussett Group busies itself across

several sectors and is reaping the rewards

as European Outlook discovers.

By Ian Armitage

Excellence}in

The Mussett Group – made up of Mussett Composites, Mussett Engineering and Mussett Aerospace - provides a range of products to the aviation, oil and gas and telecommunications industries from its UK headquarters.

The fi rm is fast-growing and is continuing to build its reputation as a key supplier to motorsport after helping produce components for several F1 teams including Virgin, Red Bull, Lotus Renault and Team Lotus through both its engineering and composites divisions

“We are optimistic for the future and have enjoyed a good couple of years,” says owner, founder, chairman and CEO Gordon Mussett , 61, who recently spoke with European Outlook. “2011 saw turnover return to pre-recession levels with strong growth and turnover was

32

Page 33: European Outlook / Issue 1

33

THE muSSETT gROup

up signifi cantly. Where did we see most growth? Well, we saw a rise in orders for the oil and gas industry, which has created lots of work for us.

“Over the next 12 months or so we hope to improve further and have a goal of reaching £10 million in annual turnover,” he adds.

The Mussett Group is 35 years old this year and has experience of working in the aerospace, composites, automotive, oil and gas and telecommunications sectors.

Most of the fi rm’s recent growth has come from the oil and gas industry, for which it creates machined metal components for drilling operations, and in the telecommunications sector, where it makes bend restrictors to protect undersea fi bre optic cabling from damage.

The fi rm is also contracted to manufacture components for the aerospace industry, working on reverse thrusters for the Boeing 787 Dreamliner and parts for the Bombardier CSeries.

“Where did we see most growth? Well, we saw a rise in orders for the oil and gas industry, which has created lots of work for us”

Page 34: European Outlook / Issue 1

34

Tell us what metal you want and we’ll supply it.

As an independent metals supplier with over 40 years experience and Expertise, we are ideally positioned to source the Stainless Steel and otherNon-Ferrous Metals required for your project.

Our extensive sourcing knowledge of the metal supplies market will ensure you get the best price for all your requirements.

We will quote for any size order: from a single billet, to a major consignment or call off supply. And as part of our ISO 9001:2008 accredited service, you will receive a timely and competitive, free, no obligation quotation.At Metals Direct our constant approach to enhancing our customer’sexperience enables us to deliver excellent customer service and order fulfilment.

Metals DirectToday, the company has around 110 staff in the three separate companies in the UK and has, in recent months, secured several new contracts.

“We had a very busy 2011 and want to build on it, continuing the momentum. As part of that, and in order to meet the increasing workload, we are moving our aerospace arm into a dedicated machining facility – because we have actually been turning work away,” says Mr Mussett . “We are certainly looking to strengthen our position as a subcontractor for that industry with the new production area.”

The new factory, which will be within the fi rm’s existing footprint in Loddon, Norfolk, in the UK, will be around 12,000sqft and will create more space for the company’s expansion.

“We are looking forward to carrying the success of 2011 into 2012, “ Mussett says. “We have an excellent reputation as a supplier for machined

components for the aerospace industry and we are hoping to further strengthen our position.

“We will be moving some of our machining centres into this new area and we’ll also be investing in new equipment – it is an exciting time.”

Signifi cantly, he says, the new dedicated facility will help Mussett Aerospace achieve AS9100 Issue C accreditation, which is an internationally-recognised quality management standard writt en specifi cally for the aerospace industry.

The fi rm’s current aerospace work includes machining bearings for aircraft undercarriages and fl ight controls, he adds.

“I must stress that we are very excited by the future,” Mussett says, before cautioning that the business does face challenges. “One of the major ones is recruiting skilled staff in the UK. We need new staff to enable us to take on new projects and expand.

“Our big problem is defi nitely gett ing skilled people,” he says.

“We had a very busy 2011 and want to build on it, continuing the momentum. As part of that we are moving our aerospace arm into a dedicated machining facility”

Page 35: European Outlook / Issue 1

“If we could get more people our growth could be even greater.

“It’s mainly CNC programmers and sett ers we’re looking for. We’re very short of them.”

Several unqualifi ed trainees had been taken on last year.

“We’ve taken on four apprentices and I’m very pleased we’ve been able to do so,” Mussett says. “This is our att empt to address the engineering skills gap which has developed. The apprentices started on a year long intermediate training programme and are working for three days each week at the fi rm and then spend two days a week studying at college. When that is fi nished, they’ll spend a further two years studying towards an advanced apprenticeship.

“It is a great way for us to train young engineers and give them the skills they need to work for us and develop their careers as engineers. There is a shortage of skilled people and this helps fi ll that gap and encourage more young people to train as engineers.

“It’s really important that fi rms support young people to help them get a foothold in the industry. It helps keep businesses alive.”

Why join Mussett ? Simple – people love being involved in high profi le projects.

35

THE muSSETT gROup

Page 36: European Outlook / Issue 1

36

Unipac Shipping (UK) Ltd is an international freight-forwarding

company established in 1993. Robert Coales, managing director of the Kent-based fi rm, tells European

Outlook what to look for in a freight-forwarder.

By Ian Armitage

freight-

The role of a freight-forwarder is to help importers and exporters transport their goods.

Most freight-forwarders specialise in particular service areas, modes of transport or markets, while others off er a more encompassing service, and they are generally seen as the “travel agents”, if you will, of international trade.

“If you have a consignment of goods you need to move from country to country, a forwarder will identify and book the best routes, modes of transport and specifi c carriers for you dependent on your

forwardthinking

Page 37: European Outlook / Issue 1

37

uNIpAC SHIppINg

requirements,” says Robert Coales, managing director of Kent-based freight-forwarder Unipac Shipping (UK).

Using a forwarder can cut your costs, he says. And, because they arrange for the transport of huge numbers of consignments, they can consolidate loads going to a single destination to keep freight charges down for individual traders.

“Whatever your shipment, Unipac will source and manage the appropriate freight package at the best price,” he tells European Outlook.

Unipac Shipping (UK) Ltd is an international freight-forwarding company established

in 1993 and the fi rm’s aim is always to provide reliable and competitive service to corporate and private importers and exporters, anywhere in the world.

“What should you look for in a forwarder? I can only talk in terms of what we off er, that being independent, straightforward unbiased advice; expertise and experience in freight forwarding solutions; co-ordinated and effi cient service; fair pricing and quick, effi cient response; that sort of thing,” Mr Coales says. “Our independence gives us the fl exibility to source the best deals and services available to our customers as we are not affi liated with any particular shipping lines or airlines.”

Unipac, he adds, off ers fi rst-class customer care. “All shipments are important to our customers, regardless of size or cost, and they need to know that goods are going

“A forwarder will identify and book the best routes”

Page 38: European Outlook / Issue 1

38

uNIpAC SHIppINg

Lovat have had a close working relationship with Unipac Shipping over many years and have always found them to be professional, dedicated and reliable.

Lovat Insurance Brokers Ltd

to be safe and arrive in one piece; they also want goods collected and delivered on time. We off er those services and also provide our customers with their own unique online tracking service, so they know where goods are at all times; importantly, we don’t off er a one size fi ts all service.”

Unipac also has multi-lingual staff , fl uent in English, Polish and Spanish, while shipments are covered by insurance.

“We off er a competitive service,” Coales says. “And we have knowledge staff so if you have an enquiry, you can feel confi dent in our ability.

“All cargo carriers have standard trading conditions that limit their limit of liability in case of loss or damage to goods they are carrying, which in many cases is a good deal lower than the full value of the cargo,” he adds. “Marine insurance covers the full value of the cargo, usually from shippers warehouse to consignee’s warehouse, and takes away the hassle of making claims against carriers, which can often be diffi cult. How and where losses occurred, and who is responsible can often be diffi cult to determine. However as most shipments are

“Over the years there is nothing we haven’t transported. We smooth the formalities of international business, so where we can offer people advice on that we do”

Page 39: European Outlook / Issue 1

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39

transported without problem, insurance premiums for general cargo are not high. Marine insurance also protects against some unexpected costs, such as when a ship at sea is damaged or when cargo is lost or has to be jett isoned in order to protect against further loss. All cargo owners and the ship owner have to contribute to pay for the loss or repair for damage to the ship in proportion to the value of their cargo. This thankfully unusual event is known as General Average and can have serious consequences for uninsured cargo owners. Unipac Shipping is able to provide cargo insurance where required.”

The company, as a result of its comprehensive services, has a broad and varied customer base of corporate and private importers and exporters, he explains. “Over the years there is nothing we haven’t transported.

We smooth the formalities of international business, so where we can off er people advice on that we do.”

What should you look for in freight forwarder? A willingness to help, Coales says. “Are we that? I would say so, yes. We put a lot of att ention into determining which level of service people require and thinking about how we might suggest things or help them in diff erent ways.

“Will we be able to meet the challenges of the future? Yes, defi nitely. Goods are still imported and exported and our services are going to be required at whatever level. There are plenty of opportunities for us in any climate so we have to be in a position to take advantage and move with the technology and times.

“We have to be able to keep moving ahead; we can’t stand still.”

As with all aspects of international trade, it pays to do your research before choosing a freight-forwarder to look after the transportation of your goods. Unipac Shipping should be one name on that list!

www.unipacshipping.co.uk

“We have to be able to keep moving ahead; we can’t stand still”

Page 40: European Outlook / Issue 1

40

Welltec®

the PoWer of InnovatIon

Welltec® holds the record for deepest water depth using RLWI on electric wireline, performing

under 388° F and having achieved the longest distance in one run

Welltec® is a solution-driven company that devel-ops, proves and applies technology to address the challenges of tomorrow’s oil and gas industry. We continuously push the boundaries of conventional oil and gas field technology to force constant de-velopment in pursuance of new frontiers.

Welltec® is founded on pioneering work by CEO Jørgen Hallundbæk who envisioned a radical idea to recover oil and gas back in 1987. This in-novative thinking led to the Well Tractor® that

revolutionized the industry when it was introduced to the market. The Well Tractor® facilitated a step change in the technique of deploying logging tools into horizontal and highly deviated wells without the use of heavier intervention methods like coiled tubing or drill pipe.

Quite unusual in the oil and gas industry, the Well Tractor® was rapidly adopted by operators, in par-ticular North Sea giant Statoil, who quickly spotted the potential in this conveyance revolution. In fact,

Statoil decided to change their intervention strat-egy based on the possibilities offered by the Well Tractor®. The willingness to adopt this new tech-nology generates approximately $30 billion a year in value creation for Statoil as they have increased operational efficiency, minimized production loss-es and maintained maximum possible production by extending reservoir decline. Today, electric line technology has become their preferred interven-tion solution.

Over the years, Welltec® has gradually evolved from a conveyance supplier to a provider of comprehen-sive oil field services. Today, Welltec® is a globally rec-ognized world leader within well solutions and we have grown solidly to achieve worldwide presence.

Our mission is to develop and deliver solutions which enable our clients to optimize the value of their oil and gas reserves by minimizing reservoir uncertain- ties and maximizing flexibility. Ultimately, we want to ensure optimal reservoir drainage.

InnovatIon RunnIng In ouR Blood

Building on past successes, Welltec® is still a solu-tion-oriented company that sees possibilities where others may see obstacles. For a company so young, Welltec® has been taking home an impressive amount of industry awards for innovative think-ing. Our ability to think outside the box has also been widely recognized and demonstrated by ap-plication under extreme and harsh conditions; e.g. Welltec® holds the record for deepest water depth using RLWI on electric wireline (2,950 ft. in Gulf of Mexico), performing under 388° F, having achieved the longest distance in one run (34,900 feet) and the longest amount of tractored footage in one trip to the wellsite (423,615 feet).

Recently, Welltec® has introduced a series of light-weight electric line solutions that can be per-formed as riserless operations and that have set new standards for what is achievable. This means that Welltec® delivers riserless lightweight inter-ventions (RLWI) that previously were not possible in the industry.

The Welltec® intervention fleet.

Snubbing, Coiled Tubing, WL Tractor and RLWI operations for Statoil operated fields (1992-2009)

Page 41: European Outlook / Issue 1

41

Welltec®

the PoWer of InnovatIon

Welltec® holds the record for deepest water depth using RLWI on electric wireline, performing

under 388° F and having achieved the longest distance in one run

Welltec® is a solution-driven company that devel-ops, proves and applies technology to address the challenges of tomorrow’s oil and gas industry. We continuously push the boundaries of conventional oil and gas field technology to force constant de-velopment in pursuance of new frontiers.

Welltec® is founded on pioneering work by CEO Jørgen Hallundbæk who envisioned a radical idea to recover oil and gas back in 1987. This in-novative thinking led to the Well Tractor® that

revolutionized the industry when it was introduced to the market. The Well Tractor® facilitated a step change in the technique of deploying logging tools into horizontal and highly deviated wells without the use of heavier intervention methods like coiled tubing or drill pipe.

Quite unusual in the oil and gas industry, the Well Tractor® was rapidly adopted by operators, in par-ticular North Sea giant Statoil, who quickly spotted the potential in this conveyance revolution. In fact,

Statoil decided to change their intervention strat-egy based on the possibilities offered by the Well Tractor®. The willingness to adopt this new tech-nology generates approximately $30 billion a year in value creation for Statoil as they have increased operational efficiency, minimized production loss-es and maintained maximum possible production by extending reservoir decline. Today, electric line technology has become their preferred interven-tion solution.

Over the years, Welltec® has gradually evolved from a conveyance supplier to a provider of comprehen-sive oil field services. Today, Welltec® is a globally rec-ognized world leader within well solutions and we have grown solidly to achieve worldwide presence.

Our mission is to develop and deliver solutions which enable our clients to optimize the value of their oil and gas reserves by minimizing reservoir uncertain- ties and maximizing flexibility. Ultimately, we want to ensure optimal reservoir drainage.

InnovatIon RunnIng In ouR Blood

Building on past successes, Welltec® is still a solu-tion-oriented company that sees possibilities where others may see obstacles. For a company so young, Welltec® has been taking home an impressive amount of industry awards for innovative think-ing. Our ability to think outside the box has also been widely recognized and demonstrated by ap-plication under extreme and harsh conditions; e.g. Welltec® holds the record for deepest water depth using RLWI on electric wireline (2,950 ft. in Gulf of Mexico), performing under 388° F, having achieved the longest distance in one run (34,900 feet) and the longest amount of tractored footage in one trip to the wellsite (423,615 feet).

Recently, Welltec® has introduced a series of light-weight electric line solutions that can be per-formed as riserless operations and that have set new standards for what is achievable. This means that Welltec® delivers riserless lightweight inter-ventions (RLWI) that previously were not possible in the industry.

The Welltec® intervention fleet.

Snubbing, Coiled Tubing, WL Tractor and RLWI operations for Statoil operated fields (1992-2009)

Page 42: European Outlook / Issue 1

42

envIRonmental BenefIts

Due to the use of electric line, our solutions repre-sent a paradigm shift in the environmental impact that traditionally has been associated with oil pro-duction. As our technologies are smaller and light-er, mobilizing them to be well site reduces fuel consumption, emissions and discharges caused by transporting and operating traditional interven-tion methods. Many times, we only need a crew of two to four people to perform interventions, which is especially important at offshore platforms where there are limitations on how many people can be onboard at the same time. Our solutions are not dependent upon large rigs or coiled tub-ing (CT) units but can be deployed from a crane or mast, which also optimizes logistics in terms of time and costs considerably while offering inher-ently safer operations.

With our precision robotics we are able to execute interventions with such precision that they do not affect the rest of the reservoir or risk damaging the well or the surrounding environment.

In addition, Welltec’s equipment can be operated miles away from the actual point of intervention, which means that the eco systems are not affected. For this reason, Welltec® is the operator of choice

in i.e. the Alaskan tundra where rolling in heavy equipment could have undesirable consequences for the environment.

Case stoRIes

To illustrate the advantages of electric line, we provide a few examples of jobs where electric line has proven more efficient than the alternatives:

Riserless lightweight Intervention Bridge Plug RetrievalRecently, we developed a method for removing hard debris and pulling a plug from a well - and we did it as a RLWI solution. This comprehensive solution broke through the hard packed debris, collected it, cleaned down around a fishing neck, latched onto it and pulled the plug. As a result, the oil company got the well back on-line with initial production of 2,000Sm3/day a whole year earlier than any other possible solution.

e-line Clean-out generates $18 million Cost savings Also in the North Sea, we were challenged to clean out a well that was experiencing problems with fill all the way up to surface. In 13 runs, we successful-ly removed the fill consisting of a resin often used instead of cement. The successful intervention en-abled the operator to continue with the planned operation while generating over $18 million in cost savings and deferred production compared to using the alternative.

Riserless subsea scale milling in three Hours In another well, we were called in to mill out cal-cium carbonate scale from a subsea well. To make it even more challenging, the operation was per-formed from an intervention vessel as a RLWI. The operator was experiencing reduced production

and was not able to run to total depth to locate the problem because of a large restriction. In total, we milled out 18 ft. of calcium carbonate scale in only three hours of downhole operations, which led to a significant increase in oil production.

foR moRe InfoRmatIon

As mentioned, these case stories only represent a fragment of what we can do. Please go to our website www.welltec.com to learn more about Welltec’s innovative spirit and service offerings.

case sToRIes

envIRonmental BenefIts

Due to the use of electric line, our solutions repre-sent a paradigm shift in the environmental impact that traditionally has been associated with oil pro-duction. As our technologies are smaller and light-er, mobilizing them to be well site reduces fuel consumption, emissions and discharges caused by transporting and operating traditional interven-tion methods. Many times, we only need a crew of two to four people to perform interventions, which is especially important at offshore platforms where there are limitations on how many people can be onboard at the same time. Our solutions are not dependent upon large rigs or coiled tub-ing (CT) units but can be deployed from a crane or mast, which also optimizes logistics in terms of time and costs considerably while offering inher-ently safer operations.

With our precision robotics we are able to execute interventions with such precision that they do not affect the rest of the reservoir or risk damaging the well or the surrounding environment.

In addition, Welltec’s equipment can be operated miles away from the actual point of intervention, which means that the eco systems are not affected. For this reason, Welltec® is the operator of choice

in i.e. the Alaskan tundra where rolling in heavy equipment could have undesirable consequences for the environment.

Case stoRIes

To illustrate the advantages of electric line, we provide a few examples of jobs where electric line has proven more efficient than the alternatives:

Riserless lightweight Intervention Bridge Plug RetrievalRecently, we developed a method for removing hard debris and pulling a plug from a well - and we did it as a RLWI solution. This comprehensive solution broke through the hard packed debris, collected it, cleaned down around a fishing neck, latched onto it and pulled the plug. As a result, the oil company got the well back on-line with initial production of 2,000Sm3/day a whole year earlier than any other possible solution.

e-line Clean-out generates $18 million Cost savings Also in the North Sea, we were challenged to clean out a well that was experiencing problems with fill all the way up to surface. In 13 runs, we successful-ly removed the fill consisting of a resin often used instead of cement. The successful intervention en-abled the operator to continue with the planned operation while generating over $18 million in cost savings and deferred production compared to using the alternative.

Riserless subsea scale milling in three Hours In another well, we were called in to mill out cal-cium carbonate scale from a subsea well. To make it even more challenging, the operation was per-formed from an intervention vessel as a RLWI. The operator was experiencing reduced production

and was not able to run to total depth to locate the problem because of a large restriction. In total, we milled out 18 ft. of calcium carbonate scale in only three hours of downhole operations, which led to a significant increase in oil production.

foR moRe InfoRmatIon

As mentioned, these case stories only represent a fragment of what we can do. Please go to our website www.welltec.com to learn more about Welltec’s innovative spirit and service offerings.

case sToRIes CASE STORIES

Page 43: European Outlook / Issue 1

envIRonmental BenefIts

Due to the use of electric line, our solutions repre-sent a paradigm shift in the environmental impact that traditionally has been associated with oil pro-duction. As our technologies are smaller and light-er, mobilizing them to be well site reduces fuel consumption, emissions and discharges caused by transporting and operating traditional interven-tion methods. Many times, we only need a crew of two to four people to perform interventions, which is especially important at offshore platforms where there are limitations on how many people can be onboard at the same time. Our solutions are not dependent upon large rigs or coiled tub-ing (CT) units but can be deployed from a crane or mast, which also optimizes logistics in terms of time and costs considerably while offering inher-ently safer operations.

With our precision robotics we are able to execute interventions with such precision that they do not affect the rest of the reservoir or risk damaging the well or the surrounding environment.

In addition, Welltec’s equipment can be operated miles away from the actual point of intervention, which means that the eco systems are not affected. For this reason, Welltec® is the operator of choice

in i.e. the Alaskan tundra where rolling in heavy equipment could have undesirable consequences for the environment.

Case stoRIes

To illustrate the advantages of electric line, we provide a few examples of jobs where electric line has proven more efficient than the alternatives:

Riserless lightweight Intervention Bridge Plug RetrievalRecently, we developed a method for removing hard debris and pulling a plug from a well - and we did it as a RLWI solution. This comprehensive solution broke through the hard packed debris, collected it, cleaned down around a fishing neck, latched onto it and pulled the plug. As a result, the oil company got the well back on-line with initial production of 2,000Sm3/day a whole year earlier than any other possible solution.

e-line Clean-out generates $18 million Cost savings Also in the North Sea, we were challenged to clean out a well that was experiencing problems with fill all the way up to surface. In 13 runs, we successful-ly removed the fill consisting of a resin often used instead of cement. The successful intervention en-abled the operator to continue with the planned operation while generating over $18 million in cost savings and deferred production compared to using the alternative.

Riserless subsea scale milling in three Hours In another well, we were called in to mill out cal-cium carbonate scale from a subsea well. To make it even more challenging, the operation was per-formed from an intervention vessel as a RLWI. The operator was experiencing reduced production

and was not able to run to total depth to locate the problem because of a large restriction. In total, we milled out 18 ft. of calcium carbonate scale in only three hours of downhole operations, which led to a significant increase in oil production.

foR moRe InfoRmatIon

As mentioned, these case stories only represent a fragment of what we can do. Please go to our website www.welltec.com to learn more about Welltec’s innovative spirit and service offerings.

case sToRIes

learn more!

envIRonmental BenefIts

Due to the use of electric line, our solutions repre-sent a paradigm shift in the environmental impact that traditionally has been associated with oil pro-duction. As our technologies are smaller and light-er, mobilizing them to be well site reduces fuel consumption, emissions and discharges caused by transporting and operating traditional interven-tion methods. Many times, we only need a crew of two to four people to perform interventions, which is especially important at offshore platforms where there are limitations on how many people can be onboard at the same time. Our solutions are not dependent upon large rigs or coiled tub-ing (CT) units but can be deployed from a crane or mast, which also optimizes logistics in terms of time and costs considerably while offering inher-ently safer operations.

With our precision robotics we are able to execute interventions with such precision that they do not affect the rest of the reservoir or risk damaging the well or the surrounding environment.

In addition, Welltec’s equipment can be operated miles away from the actual point of intervention, which means that the eco systems are not affected. For this reason, Welltec® is the operator of choice

in i.e. the Alaskan tundra where rolling in heavy equipment could have undesirable consequences for the environment.

Case stoRIes

To illustrate the advantages of electric line, we provide a few examples of jobs where electric line has proven more efficient than the alternatives:

Riserless lightweight Intervention Bridge Plug RetrievalRecently, we developed a method for removing hard debris and pulling a plug from a well - and we did it as a RLWI solution. This comprehensive solution broke through the hard packed debris, collected it, cleaned down around a fishing neck, latched onto it and pulled the plug. As a result, the oil company got the well back on-line with initial production of 2,000Sm3/day a whole year earlier than any other possible solution.

e-line Clean-out generates $18 million Cost savings Also in the North Sea, we were challenged to clean out a well that was experiencing problems with fill all the way up to surface. In 13 runs, we successful-ly removed the fill consisting of a resin often used instead of cement. The successful intervention en-abled the operator to continue with the planned operation while generating over $18 million in cost savings and deferred production compared to using the alternative.

Riserless subsea scale milling in three Hours In another well, we were called in to mill out cal-cium carbonate scale from a subsea well. To make it even more challenging, the operation was per-formed from an intervention vessel as a RLWI. The operator was experiencing reduced production

and was not able to run to total depth to locate the problem because of a large restriction. In total, we milled out 18 ft. of calcium carbonate scale in only three hours of downhole operations, which led to a significant increase in oil production.

foR moRe InfoRmatIon

As mentioned, these case stories only represent a fragment of what we can do. Please go to our website www.welltec.com to learn more about Welltec’s innovative spirit and service offerings.

case sToRIes

envIRonmental BenefIts

Due to the use of electric line, our solutions repre-sent a paradigm shift in the environmental impact that traditionally has been associated with oil pro-duction. As our technologies are smaller and light-er, mobilizing them to be well site reduces fuel consumption, emissions and discharges caused by transporting and operating traditional interven-tion methods. Many times, we only need a crew of two to four people to perform interventions, which is especially important at offshore platforms where there are limitations on how many people can be onboard at the same time. Our solutions are not dependent upon large rigs or coiled tub-ing (CT) units but can be deployed from a crane or mast, which also optimizes logistics in terms of time and costs considerably while offering inher-ently safer operations.

With our precision robotics we are able to execute interventions with such precision that they do not affect the rest of the reservoir or risk damaging the well or the surrounding environment.

In addition, Welltec’s equipment can be operated miles away from the actual point of intervention, which means that the eco systems are not affected. For this reason, Welltec® is the operator of choice

in i.e. the Alaskan tundra where rolling in heavy equipment could have undesirable consequences for the environment.

Case stoRIes

To illustrate the advantages of electric line, we provide a few examples of jobs where electric line has proven more efficient than the alternatives:

Riserless lightweight Intervention Bridge Plug RetrievalRecently, we developed a method for removing hard debris and pulling a plug from a well - and we did it as a RLWI solution. This comprehensive solution broke through the hard packed debris, collected it, cleaned down around a fishing neck, latched onto it and pulled the plug. As a result, the oil company got the well back on-line with initial production of 2,000Sm3/day a whole year earlier than any other possible solution.

e-line Clean-out generates $18 million Cost savings Also in the North Sea, we were challenged to clean out a well that was experiencing problems with fill all the way up to surface. In 13 runs, we successful-ly removed the fill consisting of a resin often used instead of cement. The successful intervention en-abled the operator to continue with the planned operation while generating over $18 million in cost savings and deferred production compared to using the alternative.

Riserless subsea scale milling in three Hours In another well, we were called in to mill out cal-cium carbonate scale from a subsea well. To make it even more challenging, the operation was per-formed from an intervention vessel as a RLWI. The operator was experiencing reduced production

and was not able to run to total depth to locate the problem because of a large restriction. In total, we milled out 18 ft. of calcium carbonate scale in only three hours of downhole operations, which led to a significant increase in oil production.

foR moRe InfoRmatIon

As mentioned, these case stories only represent a fragment of what we can do. Please go to our website www.welltec.com to learn more about Welltec’s innovative spirit and service offerings.

case sToRIes envIRonmental BenefIts

Due to the use of electric line, our solutions repre-sent a paradigm shift in the environmental impact that traditionally has been associated with oil pro-duction. As our technologies are smaller and light-er, mobilizing them to be well site reduces fuel consumption, emissions and discharges caused by transporting and operating traditional interven-tion methods. Many times, we only need a crew of two to four people to perform interventions, which is especially important at offshore platforms where there are limitations on how many people can be onboard at the same time. Our solutions are not dependent upon large rigs or coiled tub-ing (CT) units but can be deployed from a crane or mast, which also optimizes logistics in terms of time and costs considerably while offering inher-ently safer operations.

With our precision robotics we are able to execute interventions with such precision that they do not affect the rest of the reservoir or risk damaging the well or the surrounding environment.

In addition, Welltec’s equipment can be operated miles away from the actual point of intervention, which means that the eco systems are not affected. For this reason, Welltec® is the operator of choice

in i.e. the Alaskan tundra where rolling in heavy equipment could have undesirable consequences for the environment.

Case stoRIes

To illustrate the advantages of electric line, we provide a few examples of jobs where electric line has proven more efficient than the alternatives:

Riserless lightweight Intervention Bridge Plug RetrievalRecently, we developed a method for removing hard debris and pulling a plug from a well - and we did it as a RLWI solution. This comprehensive solution broke through the hard packed debris, collected it, cleaned down around a fishing neck, latched onto it and pulled the plug. As a result, the oil company got the well back on-line with initial production of 2,000Sm3/day a whole year earlier than any other possible solution.

e-line Clean-out generates $18 million Cost savings Also in the North Sea, we were challenged to clean out a well that was experiencing problems with fill all the way up to surface. In 13 runs, we successful-ly removed the fill consisting of a resin often used instead of cement. The successful intervention en-abled the operator to continue with the planned operation while generating over $18 million in cost savings and deferred production compared to using the alternative.

Riserless subsea scale milling in three Hours In another well, we were called in to mill out cal-cium carbonate scale from a subsea well. To make it even more challenging, the operation was per-formed from an intervention vessel as a RLWI. The operator was experiencing reduced production

and was not able to run to total depth to locate the problem because of a large restriction. In total, we milled out 18 ft. of calcium carbonate scale in only three hours of downhole operations, which led to a significant increase in oil production.

foR moRe InfoRmatIon

As mentioned, these case stories only represent a fragment of what we can do. Please go to our website www.welltec.com to learn more about Welltec’s innovative spirit and service offerings.

case sToRIes

43

Tel.: +45 4912 6138 ● www.crysberg.dk

Page 44: European Outlook / Issue 1

worldFormula of a

44

Page 45: European Outlook / Issue 1

45

COSwORTH

Cosworth is a motorsport legend; 176 Grand Prix victories and second only to Ferrari as the most successful F1 engine constructor of all time.

Its all-conquering heyday was the ‘seventies when it resourced practically every car on the starting grid – notably Lotus and McLaren - and powering among others, Emerson Fittipaldi, Jackie Stewart, James Hunt and Nelson Pique to victory.

Then six years ago it moved away from its F1 focus, switching lanes with new strategies, products and markets. It was a masterstroke of re-direction, combining Cosworth’s celebrated intellectual property in high-performance engines and electronics with a rapid end-to-end engineering and manufacturing strategy.

Now across aerospace, automotive, defence and marine sport – in Britain and in export markets like the USA, Russia and India - the Northampton-headquartered company continues in the position it knows best; as polesitter, doubling its turnover and winning universal accolades.

Among the latest, The Manufacturer magazine’s prestigious ‘Manufacturer of the Year’ award recognising a remarkable transition from motorsport superstar to a diversified business with a high value-added manufacturing capability competing with the best.

The original Cosworth engineering business, founded in 1958 by Mike Costin and Keith Duckworth, continued in private hands until the 1980s when it went through two changes of ownership, moving ultimately into the hands of the Ford Motor Company where for six years it was part of Ford’s Premier Performance Division. It was to be a defining relationship, bringing together the mechanics and electronic sides of the business in the same group. When Ford disengaged from F1 and its motor sports association in 2004, the Cosworth Group as it is today, was formed, its new owners, as now, Kevin Kalkhoven and Gerald Forsythe.

“Our capability and experience over the 40 to 50 years of producing F1 engines has allowed us to figure out how we can take these technologies and apply them

Current holder of the ‘Manufacturer of the Year’

title, Cosworth is the F1 superstar that diversified its high-performance engine and

electronics capabilities into fresh areas with outstanding

success. Group Head of Marketing Pio Szyjanowicz talks to European Outlook

about its first-past-the-post strategies and delivery.

By Colin Chinery

Page 46: European Outlook / Issue 1

46

into other spaces,” says Cosworth Group’s Head of Marketing Pio Szyjanowicz. “Our diversifi cation began some six years ago as the Group moved out of Ford’s hands. We were in the position of being solely dependent on one customer – F1 - and we recognised we needed to spread our operations across counter-cyclical markets.

“We took a long hard look to see what diff erentiated us from other engineering fi rms.”

One of the areas targeted was unmanned aerial vehicles – often called drones. UAV’s have two main requirements: airframe performance - achieving the power to get airborne - and a once up optimum engine/fuel effi ciency.

But there was a problem of scale. Almost all UAVs employ very small petrol engines such as found in a grass cutt er, adequate for early demonstrations of proof.

At the same time the military across NATO were moving towards a common fuel policy where every single platform from aircraft to UAVs uses the same sort of fuel – to reduce cost, complexity and risk.

However the early UAV versions were designed to run on gasoline – petrol - and it

was thought to be almost impossible to produce an engine suffi ciently small and effi cient that runs on diesel – which is what is meant by heavy fuel.

“This is one of the areas where we at Cosworth have had some considerable success. Rather than converting a gasoline engine to run on diesel and keeping it small and light - I’m talking about something you can hold in one hand and weighs about 3 kilos and produces about three HP – we took a blank sheet design to create a heavy fuel engine at minimum possible weight and maximum possible power density.

“And this allowed us to produce a compression ignition engine (most diesels combust on their own without a spark mechanism). If you can get this to work it’s extremely effi cient, with relatively litt le fuel being needed to produce the power. But it’s very diffi cult to get it to work in very small volumes. And what we have been able to do is produce them with a technology - on which we hold a patent - that enables us to produce a genuine compression ignition heavy fuel engine of the ‘hold in your hand 3 HP’ kind that’s extremely economical compared with the others in the fi eld that use spark plugs.”

“the combined traction in these four markets in that year produced that significant growth in revenues and profitability”

Page 47: European Outlook / Issue 1

47

COSwORTH

UAVs says Szyjanowicz, are only the tip of the iceberg. “The platforms we see and hear about are a very small part of what is being planned. Unmanned aerial vehicles are likely to become the mainstay of combat technology in the air, and our technology scales from 3HP all the way to 60HP and probably on to 200HP. It means you can within reason, produce an engine that will support any size platform.

“But more interesting than that is that the same sorts of unmanned technologies are being investigated for marine work and unmanned ground vehicles –UGVs – and the technology we’ve developed can be directly used to power these sorts of vehicles.

“And then there’s a considerable demand for electric power particularly in defence.. And the amount of electric power required for that is increasing enormously, so much so that the traditional alternator on many military vehicles cannot cope with supplying the amount of power soldiers need for their kit. We are seeing a signifi cant interest at the moment in our technology that can

Page 48: European Outlook / Issue 1

48

provide auxiliary generators, carried either by one or two men or att ached to a vehicle.”

In 2010 Cosworth increased its turnover by almost 50 percent, a demonstration says Szyjanowicz of what the company can off er not only to mainstream automotive and premium brands such as Aston Martin, Jaguar and Land Rover, but also the aerospace and defence sectors and the marine area of sport. “The combined traction in these four markets in that year produced that signifi cant growth in revenues and profi tability.”

The recent ‘National Security Through Technology’ White Paper outlining a £150 billion defence projects spend over the next 10-years, reveals that British companies will no longer have priority over foreign fi rms when buying equipment and weapons for the military.

Szyjanowicz however is untroubled. ”We wouldn’t expect to be given an unfair advantage based solely on where we are located. We would expect to be chosen on our merits, on the technology and capability of our products and services - the best in the world. I think Cosworth is a superb example of how to create competitive advantage, not just in what we off er but also in being able to deliver extremely quickly compared with some of the classical defence supply chain. It’s in the culture of our business.

“But I think politicians are slowly coming round to seeing what they actually have in British industry. Developments such as the Queen Elizabeth Engineering Award £1m prize - to be awarded for exceptional advances in engineering

“developments such as the queen Elizabeth Engineering Award £1m prize - to be awarded for exceptional advances in engineering - and success stories like Cosworth, and being recognised by peer panels like the Manufacturer of the Year Award, shows that the industry is there”

Page 49: European Outlook / Issue 1

49

COSwORTH

- and success stories like Cosworth, and being recognised by peer panels like the Manufacturer of the Year Award, shows that the industry is there. And questions are now being raised about what is there in the economy that goes unrecognised.

“We are more than willing to try and help politicians understand just how much manufacturing is contributing to the value of the economy. And if the likes of Mr Cameron, Mr Cable and Mr Clegg did the tour of what British manufacturing is doing, then our door is absolutely open to them any time of the day.”

With three sites in the USA and now another in India, is Cosworth committ ed to remaining in Britain? “Absolutely! Our major centre of manufacture is at Northampton, right in the middle of what the Government has just announced as one of Britain’s Enterprise Zones. We have just over 200 people working for us there, and while we have another facility at Torrance in California that allows us to do some manufacturing, the vast majority of what we do is designed, manufactured and assembled in Britain.”

The Manufacturer of the Year Award says Szyjanowicz “demonstrates how we started out on a journey from F1 and motorsport manufacturing in 2005 and progressed to a point where we can compete and be considered the best in Britain’s manufacturing sector into which we have diversifi ed.

“Aerospace manufacturing for the likes of GE, Rolls-Royce, Goodridge, has been a challenge, and to deliver to SC21 levels for world top class blue chip customers demonstrates what Cosworth is able to achieve.

“But we are extremely ambitious. The week after the award ceremony our people in Northampton were saying continuous improvement is far more important to us than the award. And Cosworth is all about the people who work for us.”

The Manufacturer of the Year “is very good at focusing on what we do for the customers we work with, perhaps without realising the value of what we do for customers we haven’t yet met,” adds Szyjanowicz.

“Cosworth’s value and ability is being able to work with customers as an engineering partner. We deal in solutions, we don’t deal in products. Much of what we do is working with a customer who has a particular need but not knowing how they are going to solve a specifi c problem.

“Aston Martin is a fantastic example. They came to us needing an engine for their One-77 super car. They had a starting point in terms of a V12 engine, but wanted more power, less weight and it would have to be slightly shorter. That was our brief and we exceeded it in terms of the power increase and weight reduction.

“More than just handing over a design blueprint we were able to do the entire service for them from working with their design team in the drawing offi ce right through to producing prototypes, testing, validating, and then manufacturing, assembling and delivering the engines.

“So whatever you think your problem may be, come and talk to us. You will fi nd we can do an awful lot more together than you might imagine.”

Page 50: European Outlook / Issue 1

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50

Inspiration}in}a

Page 51: European Outlook / Issue 1

The Max Hamburger Restaurants chain is Europe’s oldest and

Sweden’s most popular hamburger chain. It continues to inspire the

world with evidence that sustainable business pays off. European Outlook catches up with President and owner

Richard Bergfors.

By Ian Armitage

51

Max is special in more ways than one.

It was Sweden’s first

hamburger chain.It is Europe’s oldest. It is unusual. And with 3000 employees

and about 150 million euro in revenue, Max is a huge success.

It is also the perfect example of how a midsize company can carve out a profitable niche through a focus on sustainability — even in an unexpected sector.

Max’s core business is hamburgers. The meat industry is one of the largest contributors of greenhouse gases worldwide, responsible for approximately 18 percent of global emissions. In 2006 the owners of Max, the Bergfors family, began to understand that they were part of the climate problem. In response, they decided to become part of the solution.

“In 2008 Max became the first restaurant chain in the world to analyse its food’s climate impact all the way from the farmers land to the guest’s hand,” says Richard Bergfors, President and owner (and son of the founders). “We also carbon labelled our menus so that customers could choose climate smart alternatives and we have done things like implemented energy efficiency programmes in all our buildings and our restaurants are wind powered.”

Max has made voluntary carbon offsets throughout its supply chain, from farmer to customer, supporting reforestation projects in Uganda and Mozambique.

“We compensate for our carbon footprint,” says Bergfors. “We plant trees in Africa to offset its carbon footprint. New stores

mAx HAmBuRgER RESTAuRANTS

Page 52: European Outlook / Issue 1

52

mAx HAmBuRgER RESTAuRANTS

also use solar panels for 15 to 20 percent of electric needs.”

This work is internationally recognised and globally progressive. At the same time, Max is more profi table than ever.

“Sustainable leadership has clearly distinguished Max from formidable competitors such as McDonalds and Burger King,” Bergfors says.

It has allowed Max to use their business to make a positive impact on the planet.

“It certainly has,” says Bergfors.Of all the measures Max has

taken, perhaps the most surprising one is that the company actually tries to persuade customers to buy less meat.

It makes absolutely no sense! The chain is called Max Hamburgers after all.

“What we do is add more non-meat items to the menu, prominently displaying climate footprint data in store, and suggesting customers buy chicken, fi sh, or veggie sandwiches periodically -- a là Meatless Mondays,” says Bergfors. “We don’t say ‘don’t buy meat’, but we do off er suggestions for alternatives for that perhaps once or twice out of ten visits consumers opt for something else.”

There is more to the success at Max than sustainability. In 2000, it set a new strategy focused on the word “fresh” and looked closely at every ingredient and reduced fat, salt, and sugar, and eliminated items like trans fats.

The menu got healthier, with multiple side options besides

“sustainable leadership has clearly distinguished Max from formidable competitors such as Mcdonalds and Burger King”

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Page 54: European Outlook / Issue 1

54

mAx HAmBuRgER RESTAuRANTS

fries, 10 drinks with no added sugar, and a selection of darker, healthier breads.

The company now sources 100 percent of its beef and chicken — and 90 percent of its entire product — locally.

“That is very important to the consumer,” says Bergfors. “We’ve always done things a bit diff erently — the goal is greater than to just maximize profi t.”

Unsurprisingly business is booming – least not on the profi t front; Max regularly tops customer satisfaction surveys, outperforming its competitors in industry customer satisfaction surveys.

Success is following overseas too.The fi rst Max restaurant

outside Sweden opened in Norway in May 2011, and the company is looking for further expansion in 2012.

“We are performing well,” says Bergfors. “We are the most profi table, fastest growing chain in Sweden, expanding at 20 percent per year in a fl at market, while our profi t margins for each store are excellent.

“Don’t be fooled, we re still a profi t driven business and like to make a profi t like everyone else. However, we don’t put profi t fi rst; we don’t have to maximize profi t; and we can care for people and the planet we’re living on.

“don’t be fooled, we’re still a profit driven business and like to make a profit like everyone else. However, we don’t put profit first; we don’t have to maximize profit; and we can care for people and the planet we’re living on”

Page 55: European Outlook / Issue 1

55

“The result is that we are growing,” he continues. “We are growing by opening new restaurants in Sweden and that we will continue until there is no room for expansion domestically. For that reason, we are also looking abroad and last year opened up our fi rst restaurant in Norway. We will continue to grow in Norway.”

In Sweden, the company owns all Max restaurants, except the two units at Arlanda airport. The Norwegian stores are franchises.

“Our approach to franchising, like everything else we do, is a litt le bit diff erent,” says Bergfors. “We want to create the same feeling among our franchise partners as that we have created among our employees, that is to say, you are to be a member of the Max family. We believe in a long-term, strong and profi table partnership between our franchise partner and ourselves.”

Max is family owned. The founder, Curt Bergfors, is still active in the company as Chairman

of the Board, and the family still owns 100 percent of the company.

Richard is the company’s President and his brother Christoff er Bergfors is the Vice President.

“Consumers are becoming increasingly conscious,” Bergfors concludes. “They are concerned about health and sustainability and greater understanding. With the youth of today it is not enough to bring a good and cheap product to the market, you also have to do business in a responsible way and I think the companies that understand this will be the winners of the future.”

To learn more about Max and franchise opportunities visit www.maxburgers.com.