Uponor Corporation Inside information 25 October 2019 07:55 EET
Uponor has reviewed its strategy and starts an operational excellence programme aiming to cost improvements of around €20 million
Uponor’s Board of Directors have reviewed the company’s strategy, purpose and vision. The direction for growth through further expansion into the commercial market in both building solutions and infrastructure solutions remains valid.
“Current megatrends – climate change and scarcity of resources, urbanisation and digitalisation – keep shaping the construction industry and the whole of society. We at Uponor have been working with solutions that conserve water and energy for a long time, and we believe that sustainability will bring us even more opportunities going forward. Urbanisation as a trend supports our growth ambitions in the commercial segment, as the need for multi-family houses and public spaces increases. Digitalisation helps us to create innovative solutions and services that will optimise the design and build phases of construction sites,” comments Jyri Luomakoski, President and CEO, Uponor Corporation.
Uponor’s new purpose statement – rethinking water for future generations – describes Uponor’s passion for innovation, engineering and technology as well as strive to safeguard water, a scarce resource, for future generations.
Uponor’s vision is to become a recognised leader in sustainable building and infrastructure solutions. Hence Uponor aims to strengthen and widen its strong market position in selected areas even further.
Uponor’s strategy for profitable growth is based on four pillars:
- Our employees are empowered and engaged
- Customer experience drives brand preference and loyalty
- Innovative products and services add value and enable our customers to work more efficiently
- Operational excellence is the foundation
After the financial crisis, Uponor has concentrated its growth efforts on the commercial segment in building solutions and on more value added designed solutions in infrastructure solutions. To further accelerate the growth and secure competitiveness, the company will start an operational excellence programme to improve processes and increase efficiencies. This programme aims to deliver cost improvements of around €20 million with full effects realised by the end of 2021.
As the planning of the operational excellence programme continues, Uponor’s employees and employee representatives will be involved and consulted in accordance with the laws and regulations of each country. The estimated costs of the programme are expected to be around €20 million, the majority of which is expected to realise during 2020 and will be recorded as items affecting comparability. Uponor will report on the progress of the programme in its interim reports.
Uponor’s long-term financial targets remain unchanged:
- Organic net sales growth to exceed annual GDP growth* by 3 ppts
- EBIT margin to exceed 10%
- ROI to exceed 20%
- Gearing to stay within 40 to 80 as an annual average of the quarters
- Dividend pay-out to be at least 50% of annual earnings (considering the gearing target)
*GDP growth based on a weighted average growth in the top 10 countries
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Uponor in brief
Uponor is a leading international systems and solutions provider for safe drinking water delivery, energy-efficient radiant heating and cooling and reliable infrastructure. The company serves a variety of building markets including residential, commercial, industrial and civil engineering. Uponor employs about 4,100 employees in 30 countries, mainly in Europe and North America. In 2018, Uponor's net sales totalled nearly €1.2 billion. Uponor is based in Finland and listed on Nasdaq Helsinki. Uponor builds on you - www.uponor.com