Press Release: Major Investment in state-of-the-art Moulding Plant in the USA

Developing our EMEA Division – which covers our operations based in Europe – remained a priority in 2020. Strengthening relationships and staying connected with customers and colleagues has been crucial to the resilience of our operations in the year. We remained flexible, managing our businesses through lockdowns, adapting to new circumstances, and restarting our operations and opening our offices when it was safe to do so.

Market review

Difficult trading circumstances

Overall, Western Europe started 2020 in a strong economic position. However, demand across the whole of our EMEA Division was heavily affected by the COVID-19 pandemic. After strong declines in March and April, there was a recovery in the second half of the year, although this varied in intensity across our markets.

Given these difficult trading circumstances, the residential building market in France, Italy and Spain held up well, while the industry market suffered due to reduced spending in industrial construction. The infrastructure and industry segments remained strong in Germany, supported by demand for gas and water lines, and for electrofusion fittings and solutions. In France, we saw wild fluctuations in demand through much of the year.

Stress on the supply chain

The re-start of economies and manufacturing after the initial lockdowns saw demand fluctuate, particularly in France, with sudden stoppages followed by high demand. This put stress on the supply chain as businesses replenished their stock levels. The UK market was harder hit, with demand remaining low for much of the year.

Supplying the ‘Hospital of the Future’ in Italy

The New Galeazzi Hospital in Milan is the first of Italy’s ‘hospitals of the future’. It is being built with eco-friendly materials, using the most modern and efficient energy saving and environmental solutions, minimising not only waste and consumption, but also keeping polluting emissions to a minimum.

“Our Italian and French teams joined forces to offer solutions with excellent resistance to chemical and thermal treatments, ensuring they meet all current national and regional guidelines on the containment of bacterial proliferation. Our products are also safe and easy to install, and support the hospital’s green ambitions,” explains Maurizio Carano, Aliaxis Italy’s Marketing Director.

Strategy and performance

Demonstrating resilience across EMEA

Our businesses in EMEA demonstrated resilience against the impact of COVID-19 on market demand. Sales picked up after the initial lockdowns, supported by stock level replenishment from our distributors and strong demand in the DIY retail segment in France and Germany.

Better cooperation with our key suppliers and partners has enabled mutual protection and helped us tackle the challenge of peak demands for raw material.

Strong cost control, close inventory management and government support in France, Germany and the UK helped maintain a good performance across the Division over the year.

Unlocking value to boost performance

We have made changes to our EMEA organisation that are designed to unlock value, boost performance and deliver growth. This includes building an organisation in Europe that will be market driven with local teams fully empowered to grow sales in their territory by accessing the full range of Aliaxis products, irrespective of where they are produced. Country line management and functions will work more closely together to create end-to-end value in each market.

To accelerate, we have made changes in the Leadership Team: a new Divisional CEO (Gustavo Vianna, since November 2020), and new country leaders in France, Germany, Italy and the UK.

We have also created three new roles: International business development to organise export to third party customers more efficiently; Industry business development to seize the opportunities in this strategic segment by becoming a multi-market solutions provider; and Sales operations to drive productivity and effectiveness in the sales organisation.

Operational excellence

We are implementing an operational excellence programme across 15 plants in EMEA to unlock the potential in our manufacturing facilities.

The programme provides quick wins by improving operational processes that will enable continuous improvements to generate the cash we need to reinvest in our business. It is the first step towards a larger Aliaxis Operations Model that will build long-term capabilities across the Group.

France’s focus on Sales and Customer Service

Aliaxis France was confronted with the biggest drop because of COVID-19, but also saw the highest recovery. The French team also launched a new sales and customer service organisation, to better serve dealers, installers and specifiers, making use of a range of new digital tools.

Our supply chain was under severe pressure, but our teams worked hard to recover normal levels of service. We introduced extended working times, including shifts over weekends and public holidays, to meet reviving customer demand.

Mama Shelter Hotel image

Premium solutions for Mama Shelter Hotel in France

The Mama Shelter West is a hip and stylish hotel in Paris, offering a level of luxury at a lower price point than comparably trendy hotels. Aliaxis France was asked to equip each of its guest rooms and WCs, as well as provide a hot and cold-water system for the entire property. Having responded with premium solutions, we have built a strong partnership with both Mama Shelter and its parent company, Accor.

New management team in Germany

We rebuilt our senior management team in Germany during the year, with new permanent appointments to Strategic Procurement, Safety, HR, and Sales roles, alongside a new Country Head.

Sales of Infra Germany’s Electrofusion fittings and solutions remained strong, as infrastructure installation of gas and water lines continued in Germany, despite the COVID-19 restrictions.

Leading the industry in Spain

Our teams in Spain ramped-up production month by month after the initial lockdown. Our engagement with customers and employees, making good use of digital channels and new technological platforms, was very well received. Our webinars and communications positioned us as a leader in our industry in the country.

Red Cross business Challenge

Red Cross Business Challenge

The Red Cross Business Challenge is a Spanish initiative that supports individuals facing the greatest difficulty in accessing the labour market. Because we care at Aliaxis, our team in Alicante was keen to take part. We worked with the Red Cross to hire 51 employees who were at risk of exclusion, with the recruitment process taking just two weeks.

Protecting our UK business

Strong cost control, inventory management, and working hard to keep our customers happy have been key to protecting our business in the UK. We have contributed to several key projects in the year, including supporting the rapid deployment of NHS England’s Nightingale Hospitals as part of its response to COVID-19. We also supported NHS Wales’ project to prepare field hospitals for emergency use in the crisis.

Keeping close to our customers in Italy

Despite huge pressure on the Italian economy, we adapted to the conditions and achieved a strong performance on export markets by keeping close to our customers and agents using digital means.

As in Spain, Italy launched a programme to merge their country ERPs into one. This programme will finish in 2021 and will deliver harmonised data and processes, as well as a single face to the customer.

Other markets

The other markets in EMEA, like Switzerland and Eastern Europe, were less affected by the pandemic and had a rather soft year.

We put a strong focus on strengthening our teams and on talent development in the region. Leadership training – starting with safety – and cultural awareness coaching helped colleagues improve their leadership skills.

A good example of how the region has been working closer than ever with our customers came in Hungary, where the team won their biggest ever project: an important contract for PE pipes and fittings for water, with a large and well-known European car manufacturer that will produce around 150,000 vehicles in its new plant.

Looking ahead

Having dedicated time and effort over the last few years building robust operational plans across EMEA improving efficiencies, it is time to get our teams behind these plans. We will remain close to our customers and make full use of all the digital channels available.

Our growth will be focused on our main segment, building. We also expect growth to come from infrastructure (water and gas markets) as well as from the industry segment.

See our performance in

India

Our business in India, Ashirvad, continued to pursue its growth trajectory this year, enhancing our digital capabilities and overall profitability.