V D L G R O E P A N N U A L R E P O R T 2 0 1 4
V D L G R O E P A N N U A L R E P O R T 2 0 1 4
VDL Groep bv Hoevenweg 1
5652 AW Eindhoven, the Netherlands Phone +31 (0)40 - 292 50 00 Fax +31 (0)40 - 292 50 01
3 Financial highlights 4 Profile
5 Group structure
7 Report of the Board of Management 43 Report of Supervisory Board 44 Auditor’s report
45 Subsidiaries 57 Financial report 2014 62 Principles for valuation and determining the result
F I N A N C I A L H I G H L I G H T S (x 1,000 euro) 2014 2013 2012 2011 2010 Combined turnover 2,545,519 1,812,313 1,756,354 1,718,724 1,472,373 Consolidated turnover 2,342,041 1,632,108 1,628,857 1,574,805 1,353,726 Gross profit 117,988 95,610 87,407 96,275 102,779
Profit before tax 120,209 98,027 75,679 83,377 97,447 Profit before tax / turnover 4.7% 5.4% 4.3% 4.9% 6.6%
Net profit 104,247 88,582 56,755 66,014 76,762
Net profit / turnover 4.1% 4.9% 3.2% 3.8% 5.2%
Depreciation of (in)tangible fixed assets 46,300 47,326 32,490 30,465 28,844
Cash flow 150,547 135,908 89,245 96,479 105,606
(Dis-)investments including acquisitions 114,459 82,456 213,072 52,100 29,445
Equity 924,894 854,350 788,480 577,638 537,679
Total assets 1,660,407 1,382,879 1,403,669 1,062,228 1,017,657 Equity / total assets 55.7% 61.8% 56.2% 54.4% 52.8%
Net profit / equity 11.3% 10.4% 7.2% 11.5% 14.3%
VDL Groep is an international industrial company devoted to the development, production and sales of semi-finished products, buses & coaches and other finished products, as well as the assembly of cars. From its head office in Eindhoven (the Netherlands) VDL supervises its subsidiaries, which have a high level of autonomy and responsibility for results.
The establishment in 1953 of ‘Metaalindustrie and Constructiewerkplaats P. van der Leegte’ laid the basis for what today is VDL Groep. Through targeted acquisition and autonomous growth, this family business has developed into a group encompassing 85 subsidiaries spread over 19 countries and a workforce of approximately 10,300.
In subcontracting, VDL is a leader in the fields of metalworking, mechatronic systems and system supply, plastics processing and surface treatment. The car assembly division includes the production of passenger cars for third parties. The bus & coach division consists of chassis, chassis modules, coaches, public transport buses, mini & midi buses, special projects and second-hand buses. The finished products division is extensive: suspension systems for the trailer and truck industry, heating, cooling and airtechnical systems, production automation systems, systems for the oil, gas and petrochemical industry, systems for the agricultural sector, sunbeds and roof boxes, container handling equipment, waste collection systems, cigar-making and packaging machines, components for bulk handling and dust extraction installations, and systems for explosion and fire protection.
VDL Groep strives to achieve growth both through acquisitions and autonomous means. This entails a focus on making continuous improvements to its products and production processes. Such a vision imposes a number of preconditions: modern machinery, locations based on good logistics, a critical quality policy and a high level of expertise amongst its workforce. Investments made by VDL Groep enable the group to meet customer requirements.
VDL Groep has a flat organisational structure with short policy lines. The company culture is characterised by the shared VDL philosophy of ‘human added value’. This forms the basis for close cooperation between companies within the group.
P R O F I L E V D L G R O E P
G R O U P S T R U C T U R E Subcontracting VD Leegte Metaal VDL Gereedschapmakerij VDL TIM Hapert VDL VDS Technische Industrie VDL Laktechniek VDL Belgium VDL Technics VDL Kunststoffen VDL HMI VDL NSA Metaal VDL Apparatenbouw VDL MPC VDL Parree VDL Staalservice VDL Lasindustrie VDL RPI Metaal VDL Rotech VDL Systems VDL Postma VDL Industrial Modules VDL Konings VDL Wientjes Roden VDL Wientjes Emmen VDL Services
VDL Enabling Technologies Group VDL ETG Eindhoven VDL ETG Research VDL ETG Projects VDL ETG T&D Car assembly VDL Nedcar
Buses & coaches VDL Bus & Coach VDL Bus Chassis VDL Bus Modules VDL Bus Heerenveen VDL Bus Venlo VDL Bus Roeselare VDL Bus Valkenswaard VDL Bus & Coach Nederland VDL Bus & Coach France VDL Bus & Coach Italia VDL Bus & Coach Belgium VDL Bus & Coach Polska VDL Bus & Coach Deutschland VDL Bus & Coach Suisse
VDL Bus & Coach Czech Republic VDL Bus & Coach South Africa (70%) VDL Bus & Coach Serbia
VDL Bus & Coach Danmark VDL Bus Center Nederland VDL Bus Center Deutschland VDL Busland
VDL Bus & Coach Service FRY-ZHN VDL Bus & Coach Service Brabant VDL Parts
VDL Groep
VDL Nederland VDL Holding Belgium
Finished products VDL Agrotech VDL Industrial Products VDL Steelweld VDL Steelweld UK VDL Steelweld Deutschland VDL Steelweld Sweden Hapro International VDL Klima VDL Klima Belgium VDL Klima France VDL KTI VDL Delmas VDL Containersystemen VDL Containersysteme VDL Translift VDL Weweler VDL Weweler Parts Weweler-Colaert Truck & Trailer Industry PMB-UVA International VDL USA
This has been a remarkable year for VDL Groep, with the reopening of VDL Nedcar by King Willem-Alexander and the launch of MINI production in the Netherlands, on 17 July 2014. Another milestone in our history was the arrival of the 10,000th employee in August, at VDL Steelweld in Breda. From a financial point of view, 2014 was a stable and favourable year for VDL Groep, with four solid quarters. In every respect, 2014 became a record year. Naturally, the start of production at VDL Nedcar had a positive influence on results, but even without this contribution, we can look back on a year of growth. Combined turnover rose from 1.812 billion euro in 2013 to 2.546 billion euro in 2014. Consolidated turnover amounted to 2.342 billion euro as compared to 1.632 billion euro in 2013. Net result rose from 88.6 million euro in 2013 to 104.2 million euro in 2014. The tax burden in the first half of 2014 was lower, based on the forecast fiscal loss at VDL Nedcar. Total turnover for 2014 was the best in our history and that is a performance we can be proud of. This fact offers further room for investments in 2015. The balance sheet position remains unabatedly strong, with a solvency of 56%.
The number of employees rose from 9,216 at year end 2013 to 10,303 at year end 2014 (of which 81% employed in the Netherlands). 94% of this 1,087 person increase was achieved autonomously. The other employees entered the service of our business following the takeover of Translift (Dronten). This autonomous growth demonstrates that production in the Netherlands and Belgium still remains possible. Nonetheless, a sound industrial policy is vital. We continue to call for a level playing field in Europe. This is essential if we are to continue manufacturing here. A good lending climate, sound credit insurance and a flexible labour force – with a structural system of part-time unemployment benefit and flexible employment schemes for the over 55s – and technical training programmes are of key importance. We must continue in pursuit of a level playing field not only in Europe but throughout the world. Many countries around the globe impose import duties, while Europe continues to believe in a free trade zone. We must treat our trading partners in the world the same way they treat us. Only then can employment opportunities in Europe be maintained and we can form a strong block to uphold our position in the world economy.
R E P O R T
O F T H E B O A R D O F M A N A G E M E N T
Turnover
Combined turnover for 2014 amounted to 2.546 billion euro. As compared to the 1.812 billion euro in 2013, this represents an increase of 41%. Internal deliveries also increased, but fell as a percentage of total turnover.
2014 2013
million euro million euro
Combined turnover 2,546 1,812
Internal deliveries - 204 - 180
Consolidated turnover 2,342 1,632
The balance between international and domestic turnover clearly changed in 2014. The share of international turnover rose by 10% in 2014, as compared to 2013. This is mainly due to the start of production at VDL Nedcar for our client BMW Group in Germany.
2014 2013
million euro % million euro %
International 1,799 77 1,096 67
Domestic 543 23 536 33
2,342 1,632
In 2014, we supplied products worldwide to 111 countries outside the Netherlands. International turnover, divided among the various continents, is as follows: Europe 1.571 billion euro (41 countries), Asia 137
2010 2011 2012 2013 2014 600 800 1000 1200 1400 1600 1800 2000 2200 2400 2010 2011 2012 2013 2014 20 30 40 50 60 70 80 90 100 110 CONSOLIDATED TURNOVER
(in million euro)
NET PROFIT
(in million euro)
2010 2011 2012 2013 2014 600 800 1000 1200 1400 1600 1800 2000 2200 2400 2010 2011 2012 2013 2014 20 30 40 50 60 70 80 90 100 110 CONSOLIDATED TURNOVER
(in million euro)
NET PROFIT
TURNOVER PER COUNTRY
(in million euro)
Germany 970 Netherlands 543 Sweden 108 Great Britain 106 Singapore 92 Belgium 84 Spain 53 France 51 USA 47 Finland 32 Switzerland 26 Poland 25 Italy 25 Jamaica 25 Norway 20 Czech Republic 12 Denmark 12 Others 111 Divisions
If the combined turnover of VDL Groep is broken down according to the divisions subcontracting, car assembly, buses and coaches and finished products, we see that all divisions contributed to grow, whereby car assembly made the greatest contribution.
2014 2013
million euro % million euro %
Subcontracting 795 31 794 44
Car assembly 775 31 120 7
Buses and coaches 417 16 391 21
Finished products 559 22 507 28
2,546 1,812
Subcontracting
Turnover in the subcontracting division rose fractionally from 794 million euro in 2013 to 795 million euro in 2014. The semiconductor and automotive market, both important to this division, showed a slight downturn in the second six months. At year end 2014, the order book amounted to 250 million euro, as compared to 237 million euro at year end 2013. The subcontracting division showed a profit in 2014, although the result was less than last year.
In 2014, VDL invested heavily in research and development capacity with a view to further optimising our expertise as a high-tech subcontractor. The outcome was open cooperation with customers in the field of research and development. Collaboration with ASML was for example intensified, whereby VDL adopted full responsibility for the design and fabrication of the wafer handler at ASML.
2014 2013
million euro % million euro %
Mechatronic systems 422 53 432 54 Metalworking 294 37 290 37 Plastics processing 72 9 65 8 Surface treatment 7 1 7 1 795 794
Mechatronic systems and system supply
Turnover in the mechatronic systems and system supply sector fell from 432 million euro in 2013 to 422 million euro in 2014. This was mainly due to the temporary delay in the definitive breakthrough by EUV, the next generation of lithographic systems for the semiconductor industry. This delay meant a fall in demand for those technologies in which VDL has traditionally occupied a solid position such as
‘lithography’ and ‘metrology’. To meet growing market demand for other semiconductor technologies ‘deposition’ and ‘etching’, VDL further expanded its presence in Silicon Valley (United States). This is the leading region where there is a concentration of businesses specialising in those fields. This made it possible to respond better to the ever continuing clustering of businesses operating worldwide in the sector of production equipment for semiconductors.
The markets for production equipment for LED and solar cells developed as expected during the course of last year. Alongside these markets, in 2014, VDL also focused considerable attention on the market for equipment for scientific and technological applications. Important steps were for example taken in cooperation with institutes including CERN and PSI, in the field of linear accelerators, and with ESO in relation to the development of the world’s largest telescope in Chile.
We expect moderate growth in 2015, fuelled by an upturn in previous generation products for our customers in the semiconductor industry. As a consequence of the ever broader use of semiconductors, this generation of products can once again be deployed competitively. The order book remains stable, and
SUBCONTRACTING
Mechatronic systems 53% Metalworking 37% Plastics processing 9% Surface treatment 1%
The activities of VDL GL Precision, in particular in the field of high-end processing technologies, tie in well with the existing activities of the mechatronic systems and system supply sector. The company specialises in the manufacturing of very complex fine-mechanical components and assemblies for among others the semiconductor industry, the aerospace industry and the optical industry. The core activities of the business also include a number of specific processes including microlaser welding, representing an important addition for VDL Groep.
Metalworking
Turnover in the metalworking sector grew from 290 million euro in 2013 to 294 million euro in 2014. The fact that we have a presence in many industrial sectors proved particularly useful. As a metalworking player, VDL is active in the automotive industry, the food industry, the energy market, telecom,
construction and infrastructure, and the waste processing industry. New markets are constantly being explored, and new products are being developed that fit in with the current product range.
Over the past year, we once again invested in advanced machinery and further automated production processes to maintain our international competitive position. For example, on 1 January 2014, VD Leegte Metaal in Hapert obtained the international NEN-EN 1090 welding certificate in the highest execution class 4. This means that the metalworking company is authorised to weld construction parts in the heaviest category. In particular for orders from the construction and infrastructure market, this new standard is of key importance. VDL has numerous customers in this sector.
To meet the needs of our customers in the automotive industry, in particular at VDL VDS Technische Industrie in Hapert, we considerably expanded the machine fleet with a series of new machines, a 3D laser cutting machine, two flanging machines, a CNC spot welding robot and an automated welding cell. Increasingly, VDL companies are required to supply ever more complete products, products manufactured using follow on-bending-butting tools, followed by a variety of fastening techniques such as robot welding, spot welding and/or a whole range of assembly activities. Using these machines we can easily fulfil these requirements.
The prices in this sector remain under pressure due to the availability of products from low wage countries, and customers demand ever shorter delivery times combined with quality and flexibility. The VDL
companies serve increasingly as system supplier, with involvement in the entire process from design and production through to delivery and maintenance. Through collaboration with other group companies, VDL demonstrates its added value.
The order book in the metalworking sector is currently well-filled. Despite rising raw material prices and difficult recovery in some markets, prospects for 2015 can be described as broadly positive, and slight growth is expected.
Plastics processing
Turnover in the plastics processing sector rose by 11%, from 65 million euro in 2013 to 72 million euro in 2014. The automotive sector and medical industry were once again key markets over the past year. VDL Wientjes Roden moved to a new location with cleanroom facilities. Investments at this company also included a lathe and a cutting machine. Together with VDL Parree, a 3D photographic measurement system was purchased; a very precise system that is also suitable for reverse engineering (product improvement) and that has already been deployed on several occasions, at specific customer request. At VDL Parree in Sevenum, investments were also made in three new injection moulding machines (80, 140 and 500 tonnes) and a CNC processing machine for tool making. This makes it possible to deploy a variety of new techniques during the injection moulding process, such as Mucell (for weight saving and shape retention in the product) and prägen (to reduce internal tensions in the product).
VDL Kunststoffen saw deliveries to the logistic sector rise considerably in 2014. These deliveries focused mainly on components and assemblies for internal transport systems for distribution centres for consumer articles sold online.
VDL Fibertech Industries strengthened its position for composite (carbon and glass fibre-reinforced) plastics in 2014 with the takeover of the activities of Acrosoma in Belgium. This has added to the range of possibilities a promising technique of stitched and pultruded sandwich panels (drawn through a mould). Possible applications have been expanded to include aerospace and transport.
These investments in the latest machines, techniques and automation, combined with our high level of knowledge in the field of plastics mean that we can increasingly act as a system supplier in successfully tackling the complex problems posed by our customers.
The order book for the total plastics processing sector is currently reasonably well-filled. Despite the considerable rise in raw material prices, prospects for 2015 are fairly positive, and we expect turnover to be slightly higher than in 2014.
Surface treatment
Turnover in the surface treatment sector remained practically unchanged (7 million euro). In 2014, VDL Laktechniek stood out as a logistic partner for Volvo. From Eindhoven, the parts painted by us are transported directly to the various production locations in Europe. To meet this customer requirement, we equipped a new warehouse. Our competitive position has been strengthened, and despite price pressure from the automotive sector, the forecast for 2015 is that turnover will rise slightly, as compared to 2014.
Car assembly
The car assembly division made a contribution to turnover of 775 million euro in 2014, as compared to 120 million euro in 2013. This turnover was not only achieved from the production of cars on behalf of BMW Group, but also from the work by seconded personnel to other companies, the supply of press work to third parties, and engineering and installation work. The start-up costs for the first six months of 2014 were compensated for by the provisions established for that purpose. VDL Nedcar contributed to the result in 2014, with a slightly positive result.
2014 2013
million euro % million euro %
Car assembly 775 100 120 100
775 120
The first six months of 2014 were hallmarked by completion of the technical alterations to the production facilities in and around the plant. At the same time the first trial series of the new vehicles were built, and the production facilities tested. More than 800 new employees were recruited and trained.
At the latest by 1 January 2015, all 1,500 original staff were to have returned to work at VDL Nedcar, but this target had already been achieved by mid-2014, and the number of employees actually rose to almost 2,500 at year end.
17 July 2014 was the big day: VDL Nedcar in Born was officially reopened by King Willem-Alexander. On this occasion, the starting signal was also given for MINI production in the Netherlands. The King’s grand mother and mother preceded him by opening the car plant in 1968 and the refurbished production halls in 1995. We can look back on a memorable day that we were able to celebrate together with our employees, customers and business relations.
Since last summer, VDL Nedcar has been producing the 3-door MINI Hatch, on behalf of BMW Group. The start of production went according to plan. Quality and delivery reliability easily meet the requirements imposed. In 2014, VDL Nedcar produced a total of 29,196 vehicles, all of the type MINI Hatch.
In 2014, VDL Nedcar also focused on expanding its strategy of developing into a fully independent vehicle manufacturer, producing on behalf of third parties. An active policy of acquisition is in place, for attracting new customers. Together with the relevant government bodies, we are investigating the possibilities of equipping the space and infrastructure efficiently and sustainably for future growth. Finally, work is actively underway on increasing utilisation of the production capacity in the press hall.
Production volumes are expected to rise considerably as compared to 2014, and for the longer term prospects for growth in production numbers and employment are favourable. A number of investments are planned: premises were recently purchased adjacent to the VDL Nedcar site. We will also be focusing on strengthening and expanding our competences and on the acquisition of new orders. Clear attention will also be paid to spatial planning. As an independent car manufacturer, VDL Nedcar will continue to adopt a flexible attitude in respect of its clients.
During the first quarter of 2015, VDL Nedcar generated turnover of 224 million euro as compared to 178 million euro in the first quarter of last year. The order book is well-filled, both now and for the long term. Production is in line with planning and prospects for 2015 are positive.
Buses & coaches
Turnover in the buses & coaches division rose from 391 million euro in 2013 to 417 million euro in 2014. The order book also grew from 128 million euro to 197 million euro at year end. Following a very slight upturn in 2013, the bus and coach market in Europe continued to shrink. Competition from vehicles from low wage countries continues to grow. Nonetheless, the buses & coaches division succeeded in
substantially improving the result, although remaining slightly loss-making. This is partly due to high development costs for new products and production processes in 2014.
The number of buses and coaches sold in 2014 was 42% higher than in 2013 (1,490 as compared to 1,046), thereby increasing our market share. Our complete range of vehicles, both for public transport and coaches, has now been successfully placed on the market, in a Euro 6 version. Heavy investments were also made in hybrid and electrical drive systems which for the first time made a considerable contribution to the order book, in 2014. Over the past year, the effects of a number of organisational changes became more visible. Efficiency and effectiveness in the buses & coaches division have been further increased. For 2015, the focus will be on further intensifying efforts in our domestic markets for both coaches and public transport buses. We will also be focusing further on our export markets. As a result, we expect a higher number of deliveries in 2015 than achieved in 2014.
During the first quarter of 2015, turnover remained almost unchanged from the first quarter of 2014: 102 million euro. The order book grew as compared to last year from 139 million euro in week 13 of 2014 compared to 186 million euro this year. VDL expects a reasonable year for the buses & coaches division.
2014 2013
million euro % million euro %
Coaches 154 37 136 35
Public transport buses 129 31 102 26
Parts & services 69 16 60 15
Second-hand buses 41 10 41 11
Mini & midi buses 16 4 12 3
Chassis & chassis modules 6 1 36 9 High-quality Public Transport systems 2 1 4 1
417 391
Coaches
In 2014, turnover in the coaches sector rose from 136 million euro to 154 million euro. However, the number of coaches delivered fell from 561 in 2013 to 544 in 2014. The changing product mix and the higher price for Euro 6 vehicles had a positive influence on the turnover.
Our customers, the coach operators, have been facing a difficult market for years; a situation reflected in their investment behaviour. The introduction of the new Euro 6 technology may have resulted in a better and more environmentally-aware industry, but costs continue to rise and these increases are difficult for coach operators to pass on to their end customers. This is also the reason why during the first six months, many Euro 5 coaches deliberately produced for stock were sold. From the summer of 2014 onwards, these vehicles were sold out, and the complete switch was made to Euro 6 vehicles.
Also in 2014, VDL Bus & Coach delivered the first Futura FMDs (Futura Medium Deck). The FMD is a new, lower variant within the Futura family. It is a profitable all-rounder, that can be deployed for both the touring and higher end intercity market. The core values of our production range, low vehicle weight, low fuel consumption, high passenger capacity, ample baggage space and low kilometre price make the Futura FMD a high-value investment for operators. In 2014, 65 of these new FMDs were sold.
BUSES & COACHES
Coaches 37%
Public transport buses 31% Parts & services 16% Second-hand buses 10% Mini & midi buses 4% Chassis & chassis modules 1% High-quality Public Transport Systems 1%
The total market volume for coaches in 2014 was just under 3% larger than in 2013. This slight growth was primarily achieved in Germany, Spain, Great Britain and Ireland. Italy and France saw a slight fall as compared to 2013. The total market share in the Western European coach market achieved by VDL Bus & Coach rose slightly from 6.7% to 6.8%. The greatest progress was achieved in Sweden, where the FMD2 was sold in large numbers.
We expect the coach market to remain under considerable pressure over the next few years, but to show slight recovery in the countries of Southern Europe. The first indications of an upturn are already visible in Spain and in Portugal, although it is too early to talk of a trend. We continue to focus on further developing the Futura family, and we will be adding a new double-decker model in 2015.
Public transport buses
The public transport bus sector has completed a good year, with an upturn in both turnover from 102 million euro to 129 million euro, and in the number of delivered buses. In 2014, we delivered 637 vehicles, as compared to 561 vehicles in 2013. In a number of countries, limited numbers of public transport buses were purchased in response to government austerity measures, but this was easily compensated for by higher numbers purchased in Scandinavia, Germany, the Netherlands and Belgium. Competition has become more cut-throat, but we have succeeded in maintaining employment opportunities in the bus sector in the Netherlands and the Flanders region of Belgium, despite increased price pressure combined with suppliers from low wage countries.
The rise in the number of deliveries was mainly due to the Scandinavian market, where once again many public transport companies have opted for VDL products. In Finland, for the third successive year, VDL is again market leader thanks to the complete acceptance of the light-weight concept employed in the Citea Light Low Entry (LLE). This represents huge advantages as compared to all other competitors, in particular thanks to the low emission level as a result of favourable fuel consumption and lower operating costs. More and more cities in Germany have also discovered the Citea LLE, including Düsseldorf and Berlin. Following intensive testing, Berlin opted for the LLE in 2014, as its 12-metre city bus for the coming year. In total, 236 LLEs were purchased by Berlin, to be supplied by VDL between 2015 and 2017. In the Netherlands itself, VDL also supplied 164 Citea LLE vehicles, for use in the Province of North Brabant. In addition to a number of electrical projects, including a pilot involving 15 Citea Electrics for the Province of North Brabant, a large order for 120 hybrid buses was awarded for De Lijn, in Belgium. These vehicles are to be delivered in 2015.
Total market volume for public transport buses in Western Europe fell by 4% as compared to 2013. This fall was mainly caused by a major downturn in France, Italy and Great Britain. Despite this fall, VDL Bus & Coach increased its market share in the Western European public transport market, by almost one percent, from 5.50% in 2013 to 6.45% in 2014.
We expect a stable or slight downturn in the market for 2015. In particular in VDL’s key public transport markets, few deliveries are expected, due to an overall fall in the number of tenders for deliveries in 2015. However, the situation is expected to turn around, in 2016.
VDL will be further investigating the possible applications of hydrogen, and will be focusing more intensively on E-Mobility. The VDL Citea Electric has already been introduced, whereby the high degree of modularity in the Citea means we can offer tailor-made products to our client operators. The Citea Electric is ideal for any specific local situation. Our essential core values such as light-weight construction, optimum access and comfort for both passengers and drivers can be guaranteed, as a result. There are already projects in Finland, Sweden, Germany and the Netherlands, whereby during the course of 2015, 12 and 18-metre articulated versions of the electrical buses will be delivered. The 18-metre buses for the German city of Cologne will be given a new BRT (Bus Rapid Transit) design. In Belgium, the 120 Citea SLF hybrid buses are due to go into operation. The Citea SLF Hybrid is based on the Citea Electric and uses the same modular construction.
Parts & services
Despite increased competition, 2014 was a good year for parts & services, with growth in turnover of 15% (from 60 to 69 million euro). For parts & services, the bus and coach market is in a considerable state of flux, with prices for parts and repair & maintenance conditions under huge pressure. This is partly due to ever growing numbers of suppliers from China, Brazil and India, who are attempting to acquire a greater market share in Europe.
Central Service (previously a division within VDL Bus & Coach) was physically and organisationally integrated with VDL Parts in January 2014. As a result, all VDL Bus & Coach after sales activities have been centralised at a single location at VDL Parts in Veldhoven. In 2014, VDL Parts achieved growth in England, the United Arab Emirates, Scandinavia and Germany. Turnover growth was also achieved in the Benelux countries. Due to the absence of tenders in a number of other export countries, sales in those countries actually fell, for example in South Africa, Jamaica, and Ghana.
VDL Parts achieved its first ‘Bus Related Parts’ success in 2014. Over the next two years, we will be supplying parts for ‘non-VDL buses’ to a large public transport operator in Germany. This year, ‘Bus Related Parts’ is on the agenda to become an ever larger proportion of our turnover, but that will require further intensifying the relationship with our sales network and end customers.
In 2014, VDL Busland moved from Eindhoven to Valkenswaard, where it now shares premises at the VDL Bus Valkenswaard location, together with VDL Bus & Coach Nederland. The aim of this move is to improve service to our customers for maintenance, repair, and damage repair. In the domestic market in the Netherlands, VDL Busland once again achieved considerable advances, in 2014. Alongside the already existing workshops, new workshops were opened in Den Bosch and Tilburg at the end of 2014, raising the number of VDL Bus & Coach workshops in the Netherlands to seven.
Prospects for 2015 are positive. We will continue to invest in strengthening our commercial activities, above all with a view to expanding our VDL Bus & Coach after sales activities.
Second-hand buses
The stabilisation in turnover expected for 2014 did indeed continue, so that turnover at VDL Bus Center remained the same, at 41 million euro. The total number of buses sold fell from 802 to 479, but the proportion of young second-hand buses sold was higher than in 2013. The number of second-hand public transport buses sold fell from 417 to 113. This fall was due to the postponement of purchase decisions to 2015 and uncertain political situations in a number of important sales markets. The number of coaches and mini & midibuses sold fell from 385 to 366. However, sales of coaches to new European Member States rose, and VDL Bus Center expects further growth on this market in 2015. This growth is due to more intensive collaboration with the existing sales network, on which much energy was spent over the past few years. These efforts will be further expanded in 2015.
In 2015, our focus will be on cooperation with new local professional agents for export outside Europe, and these efforts are expected to start to bear fruit over the coming year. The activities of VDL Bus Center France were fully integrated in the VDL Bus & Coach France sales organisation, in December 2014. This move will have a positive impact on the figures for VDL Bus Center in 2015. We expect turnover to remain at a similar level, in 2015.
Mini & midi buses
Turnover in the mini & midi buses sector (including police vehicles and damage repair) rose from 12 million euro in 2013 to 16 million euro in 2014. The number of vehicles delivered rose from 132 in 2013 to 172 in 2014. The focus we have placed on the MidCity and international tenders in the public transport market over the past few years was continued. The order for MidCitys for public transport in Belgium was fully delivered in 2014, and was followed by a further major series order. As expected our market share in Germany, Belgium and the Scandinavian countries rose further in 2014, and we predict further slight growth in 2015. In particular prospects are positive in Germany, and in Italy we are gaining ground. We are seeing signs of recovery in the Netherlands, and we above all supplied more VIP vehicles and luxury buses for airport transport and hotel shuttles. The demand for new police vehicles was below expectations, but the upgrading and alteration of existing vehicles influenced turnover positively, as was the case in 2013.
In 2015, we expect to once again deliver more new vehicles, and to achieve higher turnover in the special (electrically-powered) vehicles and projects. Turnover in the damage repair division fell slightly in 2014. Despite a shrinking market and major changes among our clients, we have a broadly positive view for the future in this division. The order book for the entire mini & midi buses sector is well-filled and we therefore expect further growth for 2015.
Chassis & chassis modules
External turnover for chassis and module builder VDL Bus Chassis fell from 36 million euro in 2013 to 6 million euro in 2014. This fall in turnover was due to delivery of modules to bus and coach builders outside VDL, that fell from 586 chassis in 2013 to 278 in 2014. Sales generated by deliveries to sister companies within VDL Bus & Coach for the construction of complete vehicles, on the other hand, rose considerably from 747 to 1,094 modules. The total number of modules delivered therefore rose from 1,333 in 2013 to 1,372 modules in 2014.
In 2014, VDL Bus Chassis successfully transformed its chassis configurations for the European market to the Euro 6 standard. Euro 3 and Euro 5 chassis remain available for delivery, but only for the export market outside Europe.
Engineering activities in 2014 were above all hallmarked by the further optimisation of the product range, with lower weight and improved emission values. The core competence in the field of driveline technology was further extended over the year just ended. In the field of innovation, VDL Bus Chassis above all achieved progress with the development of hybrid and fully electrical bus systems. In 2015, this development will be added to the core competences.
In production, continuous improvements are being achieved in the logistic process and assembly process, in turn leading to higher quality and lower costs. The principles of lean manufacturing are the basis for further production optimisation. The final changes were made to the assembly line, last year. In 2015, a start will be made on further automating the welding process.
Partly thanks to stabilisation of the market, total external turnover in 2015 is expected to remain at a level similar to that achieved in 2014.
High-quality Public Transport Systems
Turnover in the High-quality Public Transport Systems sector fell from 4 million euro in 2013 to 2 million euro in 2014. APTS (Advanced Public Transport Systems) in Helmond, a company in which VDL Groep held 70% of the shares, was unfortunately forced to cease activities in November 2014. Over the past few years, the company has been faced with loss-making projects in France and in Italy. Part of the payments for these projects remained uncollected and there were numerous technical/commercial points of discussion. Because there was no sign of improvement in this situation in the short to medium term, the shareholders – alongside VDL Groep also Simac (18%) and BOM (12%) – recognised the need to halt these activities. APTS employed a staff of 15. All employees were offered alternative employment at VDL Bus & Coach. The Phileas vehicles operating in Eindhoven, Istanbul, Haifa, Cologne and Douai are not to be removed from the road, and VDL Bus & Coach will continue to carry out maintenance.
Finished products
Turnover in the finished products division rose by 10% from 507 million euro in 2013 to 559 million euro in 2014, with a positive result. All sectors in this division had an excellent year. Although the order book shrank from 282 million euro at year end 2013 to 189 million euro at year end 2014, this was above all due to the fact that the sector production automation systems had an extremely well-filled order book at year end 2013. VDL Steelweld has now completed a large number of projects, so the total order book for the finished products division has fallen to a normal but still good level (187 million euro at the end of week 13 2015). Turnover in the first quarter of 2015 amounted to 105 million euro, which although 5% lower than in 2014 (111 million euro) in no way changes the fact that prospects for 2015 are favourable.
2014 2013
million euro % million euro % Production automation systems 201 36 187 37
Suspension systems 133 24 129 26
Heat exchangers 94 17 87 17
Container handling equipment 48 8 20 4 Cigar-making and packaging machines 26 5 27 5 Sunbeds and roof boxes 25 4 26 5 Systems for the agricultural sector 22 4 22 4 Systems for the industrial sector 10 2 9 2
559 507
Production automation systems
FINISHED PRODUCTS
Production automation systems 36% Suspension systems 24%
Heat exchangers 17%
Container handling equipment 8% Cigar-making and packaging machines 5% Sunbeds and roof boxes 4%
Systems for the agricultural sector 4% Systems for the industrial sector 2%
This record turnover was due to major orders to supply production lines to various automotive manufacturing plants for Jaguar, Land Rover, Volvo, Ford, and VDL Nedcar. As a result, dozens of new jobs were created in Breda (the Netherlands), Barford (Great Britain), Cologne (Germany) and Arad (Romania). At the start of 2014, a new plant was also opened in Torslanda, Göteborg (Sweden).
Successes were also achieved outside the automotive industry. Together with a number of other VDL companies, series production of the previously developed AGV (Automatic Guided Vehicle) is fully up and running. Also in 2014, a start was made on the development and construction of two prototype AGVs for the port of Singapore. These activities are due to be further expanded in 2015.
The order book was very well-filled at the start of 2015 and 2015 is expected to be an excellent year. As well as maintaining the market position in Europe, the focus in 2015 will above all be on the further internationalisation of activities. A VDL Steelweld entity is due to be established in China, and a joint venture will be established in India, to support both VDL Steelweld and other VDL companies (in particular in the buses & coaches division) in the first instance in relation to engineering and design. VDL Steelweld will also be tackling the American market. We will of course continue to work on a range of product innovations, and the development and optimisation of production methods.
Suspension systems
Total turnover in this sector rose by 3% from 129 million euro in 2013 to 133 million euro in 2014. Suspension systems manufacturer VDL Weweler holds almost 40% of the European market. Worldwide, the share in the sale of air suspension systems for trucks and trailers is approximately 20%. Now the construction of a new production company in Apeldoorn has been completed, the focus is on new markets outside Europe. For customers, quality is becoming ever more decisive as compared to where in the world the suspension systems are produced. This offers opportunities for VDL Weweler, since the quality of its products is very high, thanks to the high level of automation. The infrastructure in China is constantly improving, leading to steady growth in the demand for air suspension systems for trailers in that country. For that reason, a new trading office will be established in China in 2015, VDL Weweler Asia, to improve the level of service to the market in Southeast Asia.
VDL Weweler Parts, supplier of truck and trailer replacement parts and workshop equipment, continued the growth experienced over the past few years, through 2014. The warehouse in Apeldoorn has moved to a larger location, and now serves as the central distribution centre for the other locations in Best, Hoogezand, Moordrecht and Kapelle. In Kapelle, where space is rented from sister company Hapro International, warehouse space was doubled in 2014, and sales offices were built. These investments were necessary to enable us to further expand our product range and service provision, in 2015 and beyond. Following a successful first six months, turnover figures of the Belgian company Weweler-Colaert developed less steadily in the second six months of 2014, due to the political crisis in Eastern Europe. In terms of turnover, Weweler-Colaert closed the year at a level similar to that achieved in 2013. The company, market leader for the replacement market in Europe, also succeeded in further
Our sales office in Norway, Truck & Trailer Industry, had a good year, with a slight rise in turnover. Above all the first three quarters were excellent. Towards the end of the year, sales of suspension systems and spare parts stagnated, due to the low oil price and the fall in the value of the Norwegian krone, as compared to the euro. This was compensated for by sales activities at the various Truck & Trailer Industry service points.
The order book for the total suspension systems sector is well-filled and further growth is expected in 2015. Heat exchangers
2014 was a good year for the heat exchanger sector, despite continuing difficult market conditions. Turnover rose by 8% from 87 million euro in 2013 to 94 million euro in 2014.
VDL Klima saw slow growth in the shipbuilding market. The number of investments in the oil and gas market improved. The market for wind energy also performed well, in particular in France. At the end of 2014, new premises were opened for the production plant in Hamont-Achel (Belgium) with state-of-the-art machinery for the production of heat exchangers. The major fall in the oil price is expected to have a negative effect on current and new investments in the oil and gas markets. As a result, investments in green energy are also likely to stagnate. The huge fall in the value of the euro as compared to the dollar is expected to have a positive influence on exports.
For VDL KTI in Mol (Belgium), 2014 was a year of recovery as compared to 2013, for both heat exchangers and high-voltage masts. At the start of 2014, VDL KTI received a major order for high-pressure heat exchangers for the Chinese market. Production was also started on a series of high-voltage masts for the Dutch market. Alongside these standard products, major orders were also received for barrels intended for the Dutch petrochemical industry, and orders for the production of scrubbers. These scrubbers will be used for cleaning exhaust gases from ships. Based on current legislation, we have positive expectations for this product. In 2015, VDL KTI expects this positive trend that started in 2014 to continue.
At VDL Delmas in Berlin (Germany), growth was also achieved, but given the current market situation, it is proving difficult to maintain turnover at this level. Above all on the energy market, the situation remains difficult because of political unrest and inconsistent energy policy by various governments. The result is considerable uncertainty among investors. To retain the positive line, more focus is being placed on exports, for example to India, Brazil and America. The same level of turnover is expected in 2015 as that achieved in 2014.
The prospects for the total heat exchangers sector are cautiously positive. We expect turnover in 2015 to match the level achieved in 2014.
VDL Containersystemen can look back on a very good year. Truck-related turnover from existing products such as hook lift, skip loader and cable systems rose. Both large fleet owners and small owner drivers are slowly starting to once again invest. Turnover from spreaders also rose again due to the completion of a number of projects, including a project in Turkey where 15 electrical spreaders were supplied, with an option for a further 7 spreaders. In a number of comparative tests, the spreaders from VDL emerged as excellent in terms of reliability and speed of maintenance. The introduction of our new product for the port sector, the AGV (Automatic Guided Vehicle), made a major contribution to the growth of VDL Containersystemen. In 2014, a start was made on the development and construction of two prototype AGVs for a customer in Singapore. In collaboration with VDL Steelweld, the AGV segment (both for the port sector and beyond) will be further expanded in 2015. We have also launched a series of other projects, including unwinding equipment and snow compressors that will enable us to employ our expertise in the field of heavy constructions in combination with hydraulics and complex control systems. In October 2014, the company Translift in Dronten was acquired by VDL Groep. This company, specialising in waste collection systems, side loaders and underground containers, also contributed to the turnover in the container handling systems sector. The production of these systems involves intensive cooperation with other VDL companies. According to expectations, the number of waste collection systems sold will start to rise in the second half of 2015.
The total order book for the container handling systems sector is very well-filled, and we expect further growth in turnover, in 2015.
Cigar-making and packaging machines
For PMB-UVA International, 2014 was a stable year with turnover amounting to 26 million euro as compared to 27 million euro generated in 2013. The patent position was further strengthened, enabling PMB-UVA International to once again offer a number of unique solutions to its customers. Because these innovations are based on actual requests from customers, the time to market is short. Such global themes as food safety and hygiene were also the driving forces behind further product development in 2014. In 2014, PMB-UVA International also achieved a great deal in the continuous improvement of its internal processes, with a view to achieving shorter delivery times and even higher product quality. This involved investment in a new ERP and PDM (Product Data Management) system, and upgrading the ICT infrastructure. The manufacturing facilities at PMB-UVA International have been renewed and expanded, in order to achieve shorter response times to customer-specific product developments. This manufacturing capacity will also be deployed to shorten delivery times for specific spare parts for both customers in the packaging industry and in the tobacco industry.
In the cigar market, turnover in terms of machines and spare parts once again remained stable. The portfolio of PMB Tobacco includes a number of unique products, so prospects for this market are positive. A slight upturn in turnover is expected in 2015. The prospects at UVA Packaging, where vertical packaging machines are developed and constructed, are also positive for 2015.
Sunbeds and roof boxes
Turnover at Hapro International, manufacturer of sunbeds, roof boxes, bicycle carriers and skin
improvement equipment, fell slightly from 26 million euro in 2013 to 25 million euro in 2014. Turnover in the sunbed sector remains under pressure as a consequence of fluctuating reports about this group of products. The turnover in roof boxes rose steadily. The rise in the number of hybrid vehicles with less luggage space is one of the main causes. Constructive discussions are currently underway with automotive manufacturers for the supply of roof boxes, which offer excellent prospects for the future. Asia and Oceania are important growth markets for roof boxes and skin improvement products. In 2015, we expect to achieve the same level of turnover as in 2015.
Systems for the agricultural sector
VDL Agrotech has enjoyed a reasonable year. In a shrinking market for housing systems for intensive livestock farming, turnover remained practically unchanged (22 million euro). A number of new markets, based around countries like Kazakhstan and Uzbekistan in the Middle East and Central Asia made this possible, alongside the introduction of a new pan feed system. The lower euro exchange rate also had a positive influence on sales to countries with dollar-related currencies. The project market is highly dependent on bank credits, and certainly in Eastern Europe, this represents a difficulty. The political instability in the Middle East still makes export to a number of countries in this region difficult. In Central Asia, turnover is expected to grow thanks to a further rise in regular sales via the dealer network. Expectations for 2015 are positive.
Systems for the industrial sector
For VDL Industrial Products, 2014 was a good year. Turnover rose from 9 million euro in 2013 to 10 million euro in 2014. In the course of 2014, the company focused on a broader and more in-depth range of products, based on product development. The selection of rotary valves was expanded with the addition of a new range (known as the Medium Duty range). These devices are intended specifically for production processes where higher demands are placed on machines and processes such as the food industry and the chemical sector. As well as developing products for solid handling, the first steps have been taken to come up with a number of new developments for fire and explosion protection. VDL Industrial Products commissioned a complete newly-built test installation, in 2014. This makes it possible to thoroughly test both customer specific and standard solutions, before they are delivered to the customer. Expectations for 2015 are positive. As well as expanding the product range, we will also be developing new activities in terms of service. All in all, we expect slight growth in 2015.
New companies
In January 2014, the company VDL Steelweld AB was established in Torslanda, Göteborg (Sweden). This company offers support for turnkey projects in the field of robot production automation systems for the automotive industry in Sweden, including projects for our customer Volvo. VDL Steelweld in Sweden
In mid-May 2014, the activities of the Belgian company Acrosoma were taken over by VDL Groep. This company, established in Lokeren, specialises in the production of composite sandwich panels that are for example used for further weight reduction in the aerospace industry, buses and container systems. This technology ties in well with the current activities at VDL Fibertech Industries in Best. The R&D activities in Belgium have been integrated with the R&D activities of VDL Fibertech Industries. The plant with 5 employees was renamed VDL Fibertech Belgium.
On 13 October 2014, VDL Groep acquired Translift based in Dronten (the Netherlands). The company, with 63 employees, will continue to operate under the name VDL Translift. VDL Translift is active in the development, production, assembly, sale and service of waste collection systems. VDL Translift also has its own range of innovative side loader systems for the collection of aboveground and underground waste containers. The activities of VDL Translift tie in well with the other activities of VDL Groep in respect of container handling, logistic transport systems and waste processing.
In November 2014, the company VDL Bus & Coach Service Brabant was established. This company, with 20 employees, carries out maintenance and repair work for coaches, buses and other transport systems from workshops in Den Bosch and Tilburg. These workshops are intended to carry out all maintenance and repair work for the North Brabant concession, as part of the agreement for the supply of 164 public transport buses for Arriva. A collaborative venture was also entered into with an external party for the maintenance of the VDL buses in the other towns and cities of Brabant.
Investments
In 2014, VDL Groep invested 115 million euro, approximately one-third in business premises and two-thirds in machinery and other equipment.
At VDL VDS Technische Industrie in Hapert, the first three phases of the renovation of the building were completed in 2014. A fourth phase is still to be implemented, in connection with the purchase of an 800-tonnes press. For this investment a production hall with a surface area of 1,350 m² will be raised to a height of 10 metres. The project will be completed by mid-2015.
Due to lack of space, VDL Wientjes Roden has been renting commercial premises at three different locations for a considerable time. To solve this situation, new premises were purchased in 2013, occupying approximately 14,000 m² on a 40,000 m² plot. In 2014, these buildings were prepared for the production of plastic products. At this new location, VDL Wientjes Roden has once again brought all the processes under one roof and there is space for expansion. The staff of VDL Wientjes Roden relocated at the start of 2015. The construction of the new plant for VDL Klima Belgium, previously Klima Warmtetechniek, in Hamont-Achel (Belgium) was completed at the end of 2014. The new premises cover a total area of 12,500 m², of which 10,500 m² for the production hall and 2,000 m² for offices.
changing rooms. The production halls will be expanded by 14,000 m², of which 8,200 m² cleanroom and 5,800 m² warehousing. In Almelo, VDL ETG will be building an additional 4,000 m² office space and 8,600 m² production hall, of which 4,200 m² cleanroom and 4,400 m² warehouse. This project will be carried out in three phases, the first of which will be completed at the start of 2016.
In Germany, we are currently making preparations for new premises for VDL Delmas in Berlin, where construction work is set to start in 2015. The project will be completed in 2016.
Preparations for the construction of new premises for VDL Fibertech Industries on the Kempisch Bedrijvenpark in Hapert are now fully underway. Construction work is set to start at the end of 2015. In 2014, premises were purchased in Eindhoven close to the head office, and adjacent to existing VDL premises. The offices in this new building will be fully renovated and expanded, and the plant will be redesigned, so that PMB-UVA International can take possession, at the end of 2015. As a result, the office and production areas of PMB-UVA International will be in the same location again.
At the end of last year, at VDL Nedcar in Born, an adjacent plot of land measuring 72,000 m2 was purchased, housing premises occupying 27,000 m2, for future activities.
In total, at year end 2014, VDL Groep owned approximately 1,200,000 m2 of commercial space. VDL also once again invested heavily in machinery and other equipment in 2014. A series of presses, folding machines, laser cutting machines and welding robots have been installed. Investments were also made in measuring equipment and software. In 2015, we are going to invest around 72 million euro in new buildings, machinery and the optimisation of production processes.
Employees
The number of employees at VDL Groep has risen from 9,216 at year end 2013 to 10,303 at year end 2014, a rise of 12%. 94% of these 1,087 new employees were achieved through autonomous growth. The remaining employees entered the service of VDL following the takeover of Translift in Dronten. We would like to express our huge appreciation for the dedication and involvement of our employees over the past year. Partly thanks to their excellent cooperation, we achieved the highest turnover in the history of VDL Groep, in 2014.
9500 10000 10500
EMPLOYEES
Worker participation
Within the Netherlands and Belgium, employees of the majority of VDL companies are represented by their own Works Council. At group level, there is a worker participation structure, based around the Joint Works Council (JWC).
The JWC consists of representatives of the various Dutch VDL companies. The JWC met with a member of the Board of Management on five occasions in 2014, including an annual meeting with representatives from the Supervisory Board. In November 2014, the new JWC was installed, consisting of 23 members. Consultation with the JWC is best described as open and positively critical.
Regular themes at JWC meetings are financing and market development for each division, and the accompanying sectors. The following subjects were also discussed: intensive cooperation between VDL companies and the HRM department (with special attention for the Employment and Security Act, the Bezava Act, the Participation Act, changes to pension schemes and legislation and the Old Age Pensions Act), incapacity for work, job classification and assessment, sickness absenteeism, accidents and the employment expenses scheme.
Consultation on social issues within the Belgian VDL companies was also constructive, in 2014. Within the Works Councils, socio-economic issues remain an important topic of discussion. Just as in the Netherlands, over the next few years, a whole raft of changes are set to take place in Belgium in relation to wage costs,
EMPLOYEES BY GEOGRAPHICAL AREA
(as at 31 December 2014)
Netherlands 8,320 (81%) Belgium 909 (9%) Rest of Europe 442 (4%) Rest of the world 632 (6%) Total number of employees 10,303
EMPLOYEES BY DIVISION
(as at 31 December 2014)
Subcontracting 4,158 (41%) Car assembly 2,495 (24%) Buses & coaches 1,871 (18%) Finished products 1,646 (16%)
Head office in the Netherlands and Belgium 133 (1%) Total number of employees 10,303
changes to the pension schemes and the prospects of having to work longer were regular subjects of discussion within the social consultation.
The overall conclusion is that more and more responsibility is being placed with employers, while government (both in the Netherlands and in Belgium) continues to withdraw ever further. In itself this is a perfectly acceptable development on condition that government offers employers sufficient authority, and encourages preventive measures, that remain in line with these developments.
Corporate social responsibility
VDL Groep views corporate social responsibility as an integral part of its overall business policy. As a family business, VDL Groep had traditionally maintained strong ties with its living and working environment. For us it is no more than logical that we intend to contribute to the sustainable development of our society. We demonstrate our social responsibility in various ways, for example through close cooperation with educational institutions and government, and by sponsoring a range of sporting, cultural and social events and associations. In 2014, the VDL Foundation was established on the occasion of the reopening of VDL Nedcar in Born. This foundation supports social care and welfare projects in the Province of Limburg. In 2014, the Cancer Research Fund Limburg / Maastricht University Medical Centre+ was the first beneficiary of the VDL Foundation. VDL Groep also contributes to Ondernemend Oranje Kapitaal (Orange
Entrepreneurial Capital), an organisation that aims to assist promising Dutch SME businesses to achieve their (growth) plans.
Technology and technical education
VDL Groep supports a range of initiatives to promote the technical sector and technical education, including the Ir. Noordhofprijs (our employee Patrick Claassen at VDL ETG Eindhoven was one of the winners of this prize in 2014) and the Dutch Technology Week. This support is provided with the aim of encouraging people to become interested in the technical sector, and to underline the importance of craftsmanship. For regular education, we supply both financial and material support in the form of providing machines and robots, and offering guest lectures and tours. We also offer internship and graduation placements at all levels, and operate in-house training courses. In 2014, PMB-UVA International was nominated for the title ‘Best Learning Establishment Southern Netherlands’.
Alongside the already existing internal training programme for assembly work, in the autumn of 2014 we launched our own BBL (Working Learning Pathway) training programme for the qualification operator production technology in plastics. This study programme was developed in combination with the Summa College and the Mikrocentrum. In-house training programmes have proven extremely effective in matching supply and demand from practice.
Employees
VDL is closely involved with its employees. Employee wellbeing is a high priority at VDL. We have our own disability case managers who strive to establish a plan for each employee’s reintegration from day one, with special emphasis placed on a personal approach. We also focus continuous attention on creating a safe workplace. We also offer workplaces for employees with restricted capacities. In November 2014, VDL VDS Technische Industrie in Hapert won the ‘Bronzen Venster’ award, which is presented once every two years to companies who have made particular efforts in encouraging the employment of individuals with restricted capabilities. From a social and financial point of view, we recognise the importance of ensuring that these people also have an opportunity to participate in society.
The environment
In respect of the environment, VDL operates a sustainable policy. Energy saving and waste prevention plans and the recycling of raw materials are constant areas of attention. We build company premises under our own management, and the people who supervise this work from within VDL closely monitor the latest developments in the field of sustainable building. Our focus is on less material use, lower energy
consumption and reduced environmental burdens. This is achieved for example by using sustainable materials, the introduction of geothermal heating, and the use of residual heat from the production process, for heating business premises; for example reusing the heat generated during welding. Another example of renewed energy use was the installation of solar panels covering the entire roof area of the factory halls at VDL Steelweld in Breda in May 2014. These panels generate 50% of the company’s energy requirements.
Sustainable living environment
Despite the fact that the contribution from VDL to a variety of products due to our subcontracting activities is often less than apparent, we do supply essential components for products that make a contribution to improving the living environment. One example is a production line for producing sustainable construction material such as façade panels from plant residues. Recharging columns for electrical cars, systems for the medical sector and machines for the production of flexible solar cells and LED lighting are other examples. In the development and manufacture of our own products, such as the VDL Citea Electric and the VDL AGV, a hybrid-powered port vehicle, corporate social responsibility is an integral part of the process. All in all, VDL strives to produce innovative products that are manufactured very smartly from a cost point of view, while at the same time contributing to a sustainable living environment.
Innovation
Our overall policy is focused on innovation in connection with products and production methods. We continuously seek the best techniques and invest in the most advanced machinery. Every day, we are involved in the latest developments to strengthen our competitive position on the world market. We view technical innovation as an integral part of innovative entrepreneurship. Creativity, daring and craftsmanship are the key elements.
The head office of VDL Groep is based in Eindhoven, and subsidiary companies are concentrated in Southeast Brabant. This top technology region, Brainport Eindhoven, is an excellent homebase for our company. Here, we are able to realise high-tech products and projects in collaboration with educational institutions, government and other companies. From this location, we have succeeded in establishing unique collaborative ventures with various customers in which we, as an authoritative supplier, provide highly innovative technical solutions, developed through open innovation.
In 2014, we spent 83 million euro on research & development, and a total of 874 employees were involved in R&D-related activities across all VDL companies. Those facts place VDL Groep in 7th place in the Technisch Weekblad index (top 30 business R&D April 2015) making us one of the most innovative companies in the Netherlands. Once again in 2015 we will be investing heavily in innovations, with a view to further strengthening our position.
Strategy
VDL Groep aims at controlled development, in which the control of the organisation and the maintenance of the financial position are the main considerations. The policy of VDL Groep is aimed at continuous improvement of its competitive position. An essential aspect of this is the analysis and control of costs. VDL Groep also endeavours to maintain the highest level of quality within all its subsidiaries. The investments are therefore geared towards the renewal, improvement and expansion of the product range and the production facilities. In addition, a priority in our personnel policy is to ensure internal promotion possibilities for employees.
VDL Groep believes strongly in the importance of continued manufacture in the Netherlands and the Flanders region of Belgium, in a competitive manner. Through our investment in solid professional skills, as well as in robotisation and automation, we aim to continuously improve our competitive position in the international market. In addition, our industrial activities in Eastern Europe and Asia enable us to respond to the specific wishes of our customers in terms of production in those regions. As a result of our sales branches in various countries and our extensive network of importers and agencies, we are able to sell our products worldwide. Despite the size of VDL Groep and the increasingly international character of the company, VDL is and will remain a 100% family business.
Act on Management and Supervision
VDL Groep is subject to the Act on Management and Supervision (Wet bestuur en toezicht), which regulates the structure of management supervision in public and private limited liability companies. In accordance with this Act, the company must attempt to ensure that at least 30% of the Supervisory Board and Board of Management consists of women.
In 2014, the Board of Management at VDL Groep consisted of six people, all men. Of these six people, four are due to step down in the next three years. VDL Groep intends to appoint one woman to the Board of Management in 2016.
Policy at VDL Groep is to encourage the internal transfer of employees, and strives to establish long-term relationships with its employees, with a view to retaining the company’s culture. We consider the capacity of the individual, with the aim of placing the right person in the right place, irrespective of gender, age, nationality or background. In the future, we will of course attempt to take account of a balanced distribution of Supervisory Board and Board of Management, since we share the opinion that diversity in the broadest sense of the word is good for the organisation.
Prospects
The fact that for VDL Groep 2014 was a stable year in many respects offers a sound basis for further growth in 2015. Turnover in the first quarter of 2015 rose from 585 million euro in 2014 to 646 million euro in 2015. The order book (excluding VDL Nedcar) is slightly less well-filled at 634 million euro at the end of week 13 of this year as compared to 669 million euro last year, but has remained practically unchanged compared with the end of 2014 (636 million euro).
All in all, we are on the right track and expect turnover, profit and the number of employees to be slightly higher in 2015 than in 2014. We have every confidence in the dedication, knowledge and expertise of our employees, and are convinced that this will once again be a successful year.
Eindhoven, 13 April 2015
The Board of Management, Wim van der Leegte (Chairman) Jan Karssen
Wim Maathuis Jan Mooren Theo Toussaint Rini Vermeulen
We are delighted to present to the shareholders for adoption the annual report for 2014 drawn up under the authority of the Board of Management. The annual accounts contained in the report were audited by Govers Accountants in Eindhoven, and an approved statement was issued. We subsequently approved the annual accounts. We propose that the shareholders adopt the annual accounts and discharge the Board of Management and the Supervisory Board for the policy implemented and the supervision maintained in the financial year 2014.
In 2014, the Supervisory Board convened five times in the presence of the Board of Management. Members of the Board met regularly face to face with members of the Board of Management and the president. The Supervisory Board convened once in the absence of the Board of Management with a view to discussing the performance of the Supervisory Board itself, its individual members and the Board of Management. The normal annual consultation took place with the external accountant, during which the opportunity was taken to discuss the summary of the audit findings, the accountant’s report, the
accounting systems and the financial administrative organisation of the group. Members of the Supervisory Board each year attend a meeting of the Joint Works Council.
The Supervisory Board currently consists of four members. Within the Supervisory Board, no special commissions have been appointed.
During all meetings, the operation and financial state of affairs as compared to the budgets and other targets for all individual companies and of the divisions to which those companies belong were discussed in detail. The discussions included the outline of strategic policy, the investment and acquisition policy, the operating result, the internal management and control system of the company, social policy, the
organisation and development of human resources and management development. During all meetings, intensive discussions were also held with the Board of M
