Thanks to a range of strategic initiatives COWI managed to increase its turnover for the 15th consecutive year while also achieving a considerable increase in earnings. A solid order book, strong customer relations and the acquisition of Arkitema Architects provide for expectations of further growth.
COWI can look back at another year of strong financial results across all main key figures:
With a turnover totalling DKK 6,203 million the consultancy company achieved growth for the 15th year in a row. Moreover, COWI’s operating profit before depreciation and amortisation (EBITDA) was DKK 487 million, representing an EBITDA margin of 7.8 per cent. Operating profit (EBIT) increased by 10 per cent to DKK 295 million. This corresponds to an EBIT margin of 4.8 per cent. Finally, COWI achieved a cash flow of DKK 354 million.
CEO Lars-Peter Søbye is pleased by the progress, which according to him is attributable to the strategic choices, strong customer relations and employee focus:
"Halfway through our strategy period I am very pleased that our tough prioritisation of the core markets in Scandinavia and the UK, among others, seems fruitful.
Also, we have succeeded in building deep and long-term relations with our customers, which is absolutely essential - particularly in a market characterised by political uncertainty and unstable financial markets. 95 per cent of our turnover in 2018 came from customers who we have worked with for several years.
In terms of specific projects, we won the detailed design of the whole transport system for Ring 3 light rail, just to mention one. In addition, we have now entered the second phase of the biggest infrastructure project in Norway in the past 20 years, the Fornebu Line in Oslo - thanks to the good customer collaboration in the first part of the project," Lars-Peter Søbye says.
He gives all the credit to the employees. In these years, we have particular focus on our employees:
"The fight for the most skilled employees has intensified. This is why, in 2018, we initiated new talent programmes, invested in the development of our managers, set up summer intern programmes along with other initiatives in order to attract and retain talents. We have the highest-ever level of employee engagement, and we are advancing further in surveys of both students’ and professionals’ assessment of employers in Denmark – to number 4 and number 3, respectively", he explains.
2018 ended with the acquisition of the biggest architect business in Denmark, Arkitema Architects.
"This is a historic milestone for COWI and a completely new arena of opportunities as we are now able to offer even more innovative solutions, such as integrated design, to our customers. I have no doubt that this acquisition will fuel our growth further in the coming years", Lars-Peter Søbye states.
In the next year, focus will be on North America and Norway as particularly favourable growth markets within infrastructure:
"Many places in North America have a massive need for renovation of the infrastructure which is why it is imperative to invest in improvements in the coming years. It is a promising market for companies like COWI as we have been there for many years and have proven core competences within infrastructure. Therefore, we are also looking for further acquisitions in the coming year," Lars-Peter Søbye adds.
"In Norway, the politicians have decided to invest just under DKK 60 billion in infrastructure – annually! – in the coming years. It is a stable market with organised conditions where we have managed to build good and close relations with large customers and partners. In addition, we are using our competences across all of Scandinavia, just as we are making increasingly use of our skilled colleagues in India, especially during the design phase of projects worldwide."
Lars-Peter Søbye expects the market in 2019 to be very similar to that of 2018:
“There will be continued uncertainty regarding the international political development and the financial markets. But we also expect the global economy to grow, and we still see lots of growth potential in our core markets."