NNE CHARGES FORWARD WITH A BILLION IN TURNOVER
21 March 2002 - NNE A/S

NNE passed a billion in turnover last year, employs approx 1000 people and can show economic key figures that are at least at the same level as those of the competitors.

According to Hans Ole Voigt, president of NNE, the goal is not to be the biggest, but to earn more money. The profit margin before tax was last year 4.9 percent. The goal is 10 percent and it has to be reached next year, says Mr. Voigt. Thus he is also saying that the three 'big ones', each having a turnover in the range of 1.5 billion kroner, have to make an effort, if they do not want to fall seriously behind when it comes to earning capacity.

The forward charging NNE is strongly favoured by its parent, which is currently the largest builder of the country. As Lars Rebien Sørensen, CEO of Novo Nordisk A/S, puts it: 'We are currently building a bridge over the Great Belt from Hillerød to Kalundborg.'

The company is building the biggest insulin plant in the world in Kalundborg for 2,5 billion Danish kroner and a 'plant of the future' for the haemophilia drug NovoSeven in Hillerød, at the price of a billion Danish kroner. In addition there are a number of minor constructions going on. Novo Nordisk is investing about 22 billion kroner over 5-6 years in new manufacturing plants. It is a Danish record for a private builder. And this is where the Great Belt bridge is a fair basis of comparison. This year alone Novo Nordisk's total investments amount to 4,5 billion Danish kroner. But the kinship is no pretext for doing nothing.

'Novo Nordisk is challenging us increasingly, and if we are not competitive, they will choose other consultants', says Hans Ole Voigt.

At the same time Novo Nordisk is encouraging NNE to create its own identity and chase more external projects. Out of last year's turnover of almost 1,1 billion Danish kroner, 10% came from external clients. This number must increase strongly over the years to come. NNE must exploit its expertise within biotechnological and pharmaceutical industry to get hold of the engineering consultancy projects that the expected biotech boom in the Medicon Valley of the Sound region will result in.

NNE is no ordinary engineering consultancy company. It is, at least according to its own statement, unique in Scandinavia with competences in engineering and management ranging from A to Z of constructions and process plants within the pharmaceutical and biotechnological industry.

Among its competitors NNE counts the American engineering consultancy groups Fluor and Jacobs, and German Linde. Thus Jacobs is the engineering consultant of Biogen who is planning to build a manufacturing facility in Hillerød for several billion Danish kroner. According to Mr. Voigt, president of NNE, NNE is working intensively on getting hold of the big American biotech company as a client. NNE has already established a good name within the industry and executes projects for a number of companies, including Ferring, Genmab, Egalet, Ferrosan, Lundbeck, Coloplast, Pharmacia and several others.

Hans Ole Voigt does not want to say how big the external share of the turnover has to be. '50% does sound of much,' he says, but he does not deny that this could be the case in a few years' time.

He imagines that the company can obtain a fair share of the Swedish market, but also large projects in far-off markets.

'We have followed Novo Nordisk, where they have built, and therefore we have a subsidiary in China. The market out there could be interesting for us. So if other companies are going to build in China, we can tell them what it takes to succeed in cooperating with the Chinese,' says Hans Ole Voigt.

NNE became an independent subsidiary 11 years ago, but has not been let loose before now as a company with an independent profile. However the owner has decided that for the next 5 years the company will remain a 100% owned subsidiary of Novo Nordisk, because during that period Novo Nordisk's plans for building are so extensive that it is important to have the availability of NNE in a critical situation. But otherwise there are no restrictions other than that the company must say 'no thank you' if Eli Lilly wants to hire NNE's consulting services to build a new insulin plant or if other direct competitors to Novo Nordisk intend to 'steal' technical knowledge from NNE.

'When we look further ahead than this five-year horizon, other types of ownerships are absolutely possible,' says Jesper Brandgaard, Chairman of the board of NNE and CFO of Novo Nordisk.

'Stock exchange listing may also be a possibility. But I find it just as likely that NNE could be a Northern European branch as part of an international engineering consultancy company, which has biotechnological companies as its core competence,' he adds.

Jesper Brandgaard thinks that no matter what solution is chosen, Novo Nordisk will continue to have an ownership interest in the engineering consultancy company.

He compares NNE to Maersk Data of the A.P. Moeller Group, which really has succeeded in taking the plunge and getting external turnover.

'We are well on the way with NNE as the first of our internal service companies. Later it may be the turn of our 'mini ISS', Novo Nordisk Service Partner, and our own little Maersk Data, Novo Nordisk IT,' he says.

http://nne.dk/

More News:
  • For March 2002
  • From NNE A/S
  • For Medical Equipment