Rapid international expansion, maintaining leadership position in Poland, offering end-to-end solutions that exploit technological innovation, and entering the hard rock mining segment are the principal goals defined in the FAMUR Group’s new growth strategy for 2019–2023. The Group is set to increase its revenue to PLN 2.5–2.7bn by 2023, of which over 50% is to be export revenue. Following the implementation of the new strategy, FAMUR wants to become the preferred global supplier of end-to-end, innovative solutions for the mining and cargo handling industries and a top 3 manufacturer of machinery for the soft rock mining sector.
The new growth strategy puts customers and their needs at the centre of the Company’s activities, as reflected not only in its vision, but also in its mission statement, which emphasises that FAMUR is built by people who share a commitment to supporting customers in achieving their goals by providing effective solutions in conformity with the highest environmental standards. The cornerstone of the strategy are the values that will serve as a guide for day-to-day operations of the entire organisation.
“In our strategy a strong focus is placed on close cooperation with the customer, which encompasses providing assistance in obtaining financing, designing effective, reliable, safe, innovative solutions tailored to customer needs that offer value for money, optimising manufacturing and logistics processes to deliver quality products always on time, and providing professional 24/7 after-sales support and a complete range of added services,” says Mirosław Bendzera, President of the FAMUR Management Board.
The strategy is to help generate revenue growth to PLN 2.5–2.7bn by 2023, with profit margins preserved at current levels, which the Group wants to deliver through four strategic objectives:
The FAMUR Group will seek to maintain its strong position on the home market as the supplier of choice for customers in Poland. Customers at home can count on FAMUR to expand its range, step up product innovation, and deploy a custom-tailored training and maintenance & support system. Plans are also in place to commercialise new solutions that use robotic, virtual reality, simulation and Big Data technologies, and to implement the Smart Mine concept at mines in Poland. FAMUR customers will be offered support to improve their mining efficiency as well as health and safety performance, particularly in high-risk areas.
The FAMUR Group plans to significantly increase its presence on international markets within the next five years, so that in 2023 more than 50% of its revenue come from exports. In the priority markets, where the Group has an established position now, the Company will strengthen its organic growth through such means as expanding the maintenance and support centres and increasing the availability of after-sales services. In opportunistic markets, where FAMUR is still building its position, it wants to grow by forming strategic alliances with local partners or by acquiring businesses with a stable customer base and market share.
The FAMUR Group wants to be a supplier of comprehensive solutions for the mining and cargo handling sectors. In the period covered by the strategy, the Company plans to significantly increase its installed machinery base in Poland and foreign markets, and intends to steadily develop its aftermarket business while stabilising the lease revenue. At the same time, it plans to expand its portfolio by offering high value-added services, such as predictive maintenance and diagnostic reporting, to ensure that more than 25% of the Group’s revenue is recurring revenue.
The FAMUR Group intends to enter the rapidly growing hard rock mining business. This goal is to be achieved by acquiring a company with revenue between PLN 100m and PLN 200m and driving its further organic growth.
“We believe that the ambitious strategic goals we have set for ourselves will allow us to become the preferred global supplier of end-to-end innovative solutions for the mining and cargo handling industries. Expansion into foreign markets is one of our key engines of growth and should make it possible to derive more than half of our revenue from abroad in 2023. Clearly defined directions of expansion and the right strategy of growth or entry into each of the selected markets, as well as development of end-to-end solutions and a stable position in Poland will allow us to become one of top three global manufacturers of mining equipment for the soft rock mining sector. We also want to build a third strong segment within the Group, in the rapidly growing hard rock mining business,” said Mirosław Bendzera, President of the Management Board of FAMUR SA.
The pursuit of these strategic objectives will be supported by measures undertaken in three areas of key importance for the Company.
The first area is operational excellence, in which the Company will:
– place a strong emphasis on safety,
– fully optimise its production and logistics processes to ensure high quality and timely deliveries, and
– adapt its organisational structure to the new strategy, customer needs and challenges facing the Group. As of January 1st 2019, the Company’s Management Board will be composed of the President (CEO) as well as Vice Presidents responsible for domestic sales, export sales and operations in the Underground segment, Vice President responsible for the Surface segment, as well as Vice President for Finance and Vice President for Strategy and Development, who will supervise both segments. Following the acquisition of a business in the hard rock mining sector, the FAMUR Management Board will be expanded to include a Vice President responsible for that segment.
The second key area of activities supporting the implementation of our strategy is smart technology, where the focus will be on development and commercialisation of technologically advanced solutions enabling the transformation and further improvement of efficiency and safety in the mining sector while reducing operating expenses and adverse environmental impacts of mining operations.
The third important area is scaling up through organic growth, strategic partnerships and M&As, where the selected business model will be adapted to the nature of both the operating segments and individual markets.
“Customers expect the application of state-of-the-art technologies to transform and further improve the efficiency of the mining sector. That is why we want to be the preferred partner creating smart solutions that meet customer expectations and ensure efficiency, safety and reliability. Smart technology is a priority area in the development of the solutions we offer, and the guiding motto of our strategy is: Proven solutions. Global reach. Smart technology,” said Mirosław Bendzera, President of the Management Board of FAMUR S.A.
As part of the Strategy, the Company’s Management Board adopted a dividend policy that assumes recommending the payment of 50% to 100% of net profit as dividend. The Management Board expects to recommend the payment of 75% of net profit as dividend on average over the next five years. The dividend policy may be changed in the event of significant acquisitions or material changes in market conditions or the Company’s situation, to keep FAMUR’s debt at safe levels.