250 likes | 426 Views
Analysts & Investors, August 2001. Legal, Tax & Business Europe David J. Smith , CEO. TABLE OF CONTENTS. Overview of cluster Wolters Kluwer LTB Europe Challenges Strategic Directions and Decisions LTB Europe’s Recipe for Growth Future Goals The Story S o F ar and N ext 12 M onths
E N D
Analysts & Investors, August 2001 Legal, Tax & Business Europe David J. Smith, CEO
TABLE OF CONTENTS • Overview of cluster Wolters Kluwer LTBEurope • Challenges • Strategic Directions and Decisions • LTBEurope’s Recipe for Growth • Future Goals • The Story So Far and Next 12 Months • Summary
OVERVIEW OF LTBEUROPE Consolidated Results - EBITA Performance Improving * Linked to EUR 250 million additional (Internet) product development spending
OVERVIEW OF LTB EUROPE Media Format Breakdown - Full Year 2000 Strong Print Base … Sales by Media Type (FY 2000) Electronic (EUR 248 million) Print (EUR 1,068 million) Print Sales By Type Electronic By Delivery FY 2000 FY 2000 Internet Loose Leafs Journals Online Books CD ROM Document Services
OVERVIEW OF LTB EUROPE Media Format Breakdown - Half Year 2001 / Half Year 2000 … But Electronic Sales Increasing Sales by Media Type HY1-2001 Sales by Media Type HY1-2000 Electronic Electronic (EUR 107 million) (EUR 137 million) Print Print (EUR 521 million) (EUR 517 million) Electronic By Delivery Electronic By Delivery HY1-2000 HY1-2001 Internet Internet Online Online CD ROM CD ROM
OVERVIEW OF LTB EUROPEDense Network, Leading Positions SCANDINAVIA UK NETHERLANDS UK GERMANY UK CENTRAL/EASTERN EUROPE UK UK UK UK BELGIUM AUSTRIA UK FRANCE UK UK ITALY SPAIN UK L E G E N D UK ACROSS EUROPE UK ACROSS EUROPE Reed Elsevier Thomson Local player
OVERVIEW OF LTB EUROPECore Strategy: Leverage Key Proprietary Assets in Areas of Content, Software, and Services Convergence Tax Software Taxable Business Profits Klubas Akelius Online Consulting InKnowvation IRPC Content Services Software Software & Compliance Services Tax-forum OA Sistemi Transaction Databases FDS Advance
OVERVIEW OF LTB EUROPECore Strategy: Positioning LTB Europe to move up the Value Chain • A3res (Spain) • Jura@be (Belgium) • Tutto Lavoro Windows (Italy) • Kluwer Plaza’s (Netherlands) • AOK-line (Germany) • Lamyline (France) • Fd-centre.net (UK) High • Addition of hyperlinks • Integration of workflow tools • Libraries of integrated content Tertiary Material • Reference Book for Employers (UK) • Fiscal Tax Compliance (Belgium) • Liaisons Social / Fiscal / Assurances (France) • Lohnbüro (Germany) • Kluwer Fiscal Guide • La Legge (Italy) • Nederlands Juristenblad (Netherlands) • El Diario La Ley (Spain) • Fiscaal Zakboek (Netherlands) • Addition of indexes • Commentaries • Expert analysis • Authored periodicals Value Added Secondary Material • Kluwer law text books (Netherlands) • Base de Datos Legislacion (Spain) • Juridisque Cour de Cassation (France) • Employment Case Law Index (UK) • Lex (Poland) • Convenios Colectivos (Spain) • Public Domain Information • Content for basic research Primary Source Material Low
CHALLENGES • Increase sales growth: • Historically insufficient focus on innovation • Sales do not mirror marketing spending • Status digitization different across countries • Bundled pricing models an issue in some countries
CHALLENGES Bring costs in line with sales Improve strength and depth of management and control Invest in full integration of common front and back office systems across Europe LTB Europe challenges require a strong common approach to strategy and structure at cluster level.
STRATEGIC DIRECTIONS AND DECISIONSA Twofold Approach 1. Operational Excellence • Streamline operations and drive down costs, e.g.: • Rationalize locations • Limitpersonnel costs • Improve cost of sale efficiencies(printing on demand) • Common skills, knowledge and measurement, e.g.: • Intensify unified European management development program • Set up benchmarks • Structure and strategy that focus on where the money is - the customer
STRATEGIC DIRECTIONS AND DECISIONSA Twofold Approach 2. Significant, Sustainable and Profitable Growth • Focus on six core customer segments – deepen share of wallet • Harvest/divest non-core business • Implement matrix cluster structure • Increase organic growth
STRATEGIC DIRECTIONS AND DECISIONSPortfolio Review: Current Situation • Fragmentation over 16 customer segments; 6 largest customer groups generate around 75% of sales • Several customer groups only served in one or two countries • Customer research, marketing and digitization fragmented over 16 segments • Some segments are small, have a higheradvertising exposure No focus of strategy and growth priorities No synergies; no product exchange Inefficient use of money and management Recession - Sensitive
STRATEGIC DIRECTIONS AND DECISIONSPortfolio Review: Focus on Core Segments Breakdown of Sales by Customer Segments Other Segments (~10) Fiscal / Financial Health, Safety & Environment (HSE) Legal Transport HR Public Portfolio is spread over many customer segments Full year 2000 sales: EUR 1.3billion
STRATEGIC DIRECTIONS AND DECISIONS Portfolio Review: Selection Criteria Core Segments Size and growth Need to Have • Current market size • Number of professionals • Average spend per professional on publishing products • Expected market growth • Growth of number of professionals • Potential for additional services (e.g.software,services) Profitability • Regulatory/ compliance element • Information refreshment rate • WK information/ services core to customer’s business • Quality/reliability of information is essential (‘need to have’) Wolters Kluwer LTBEPosition • Realistic EBITA margin potential within 3 years • Market and business risks (stability and predictability of income streams ) Importance to WK LTBE • Relative market share • Ability to become top-2 player within 3 years • Competitive strength (branding, content ownership) • Percentage of total country sales which are generated by this segment • International synergetic possibilities
STRATEGIC DIRECTIONS AND DECISIONSPortfolio Review: Description Core Segments Tax consultants, accountants, financial executives, financial planners in banks and insurance, (public) tax auditors Fiscal / Financial Lawyers, notaries, magistrates, public prosecutors, institutional and company lawyers Legal HR director/managers, payroll/benefits managers, training/ development managers, HR consultants HR Line managers in state and regional government and in municipalities, police, pedagogic professionals, social workers, labour union professionals Public / Social Managers focused on health & safety, facilities, maintenance and environmental issues, waste contractors, HSE consultants HSE General transport managers, transport logistics managers, engineers, product managers, sales & distribution personnel Transport
STRATEGIC DIRECTIONS AND DECISIONSNew Organisation Structure Cluster CEO CFO HR Director CTO etc… Country CEO 1 Country CEO 2 Country CEO 3 E I S C Legal customer groups Legal customer groups Legal customer groups Legal Facilitator Fiscal / Financial customer groups Fiscal / Financial customer groups Fiscal / Financial customer groups Fi / Fi Facilitator HR customer groups HR customer groups HR customer groups HR Facilitator Etc. Etc. Etc. Etc.
STRATEGIC DIRECTIONS AND DECISIONSMission "To be on the mind of each of our target customers, on their computer screen, laptop, mobile; in their briefcase, drawer, desktop; with smart content, superior services and support, making their job easier, more effective and profitable"
FUTURE GOALS • Increased wallet share of core customer segments to achieve an average sales growth of 7% per annum • Rank 1st / 2nd in chosen customer segments • Create a structure, reporting and measurement system and renumeration package centered on these customer segments • Stabilize and increase profitability, leading to EBITA margin of more than 20% • Create operational comparability and excellence • Further prepare digitized content in core segments through common technology as a platform for “smart” content.
THE STORY SO FAR AND NEXT 12 MONTHS SO FAR: • Have set up the basic structure • Have acquired a number of workflow software companies in core areas • Have identified key markets and begun process of divesting • Have made progress with building of common European Internet Platform • Cost-saving plans already underway.
THE STORY SO FAR AND NEXT 12 MONTHS NEXT 12 MONTHS: • Redefine managerial competency needs and establish management development program • Further turn structures to customer centric approach • Leverage skills, knowledge and products across Europe in key customer segments • Increase innovation initiatives • Set up focused acquisition program • Set up benchmarks; operational management accounts • Further improve cost controls • Upgrade CRM systems • Use common technology approach to continued digitization of content in core customer segments.
SUMMARY • Culture change; innovation and growth • Cost controls • Driving up through value chain • Customer centric
Analysts & Investors, August 2001 Legal, Tax & Business Europe David J. Smith, CEO