The Board of innogy has defined a target picture for the year 2025 as part of the refined version of the company’s corporate strategy. Priority is given to the areas of (market) Position, Performance and Portfolio, with innogy aiming to be among the three leading providers (Position) and among the most profitable companies in the industry (Performance) in all relevant markets by 2025. To achieve this goal, there will be no taboos with regard to current business activities (Portfolio). In addition, all activities are intended to address the future energy system. As a result, innogy will pursue a partnership-based approach. innogy will become or remain the number 1 energy partner for customers, municipalities as well as corporate and financial partners (Partnership).
Europe will remain the company’s home region. However, the company will seek to achieve growth through investments in Europe as well as North America. The Supervisory Board consensually took note of the refined strategy at its meeting today.
"Our IPO has created a strong foundation on which to profit from future growth in energy markets," said Peter Terium, CEO of innogy. "The refinement of our strategy ensures our ability to take full advantage of our head start while also securing our competitiveness in the long term. If you want to be successful in the energy world of tomorrow, you will need economies of scale and profitability, along with the respective skills. With the four keywords of "Position, Performance, Portfolio and Partnership", we’ve placed our strategic focus on precisely these critical success factors."
Winning market shares in existing areas of business
In order to achieve a top 3 position in all relevant markets, innogy must drive growth on its own but also pursue an active portfolio policy. As a result, in its existing businesses the company seeks to grow at least as fast as the overall market and, ideally, to gain additional market shares. Beyond this, innogy intends to build up a strong market position in three important growth areas: eMobility, photovoltaics and glass fibre networks (FTTx). To develop these growth markets and the industry-leading Innovation Hub up to €1.2 billion in investments are planned by 2019.
In eMobility, innogy currently operates around 5,800 charging points in more than 20 countries. As a full-service provider, it offers the entire range of services – from planning, construction, operation and maintenance through to invoicing. In addition, the company has played a significant role as co-developer of the "Combined Charging System", the international charging standard for electric vehicles. innogy sees an opportunity to create a global standard and thus a global platform, while becoming the leading provider of eMobility solutions in Europe and the US.
In the photovoltaics sector, innogy’s Belectric holding means its portfolio already contains one of the leading companies active in the construction of large-scale solar power plants. Its declared objective is to build a strong market position in Europe, North America and selected emerging countries in the still highly fragmented market for greenfield photovoltaics.
In the glass fibre networks sector, where Germany has considerable backlog, innogy is looking to significantly increase the pace of expansion yet again. Additionally, innogy evaluates projects abroad. As an energy supplier with profound technical expertise for infrastructures and many partnerships at municipal level, the company is virtually predestined to drive the expansion of optical data lines.
“We need to be among the best“
Beyond these organic growth initiatives, innogy will also strengthen its portfolio through acquisitions and divestments. It will dispose of business activities where the company is not leading in terms of market ranking (Position) and profitability (Performance) or where leadership cannot be achieved. innogy will recycle capital to invest in markets and companies in which it can achieve a top 3 position and a high level of earnings contribution This active portfolio policy will also see the company increasingly cooperate with strategic partners and financial investors.
"In the long run, having a positive figure on the bottom line is no longer sufficient for a business segment. If we want to be viable in the future as a company, we need to be among the best," said Peter Terium. "Our goal must be to rank among the market leaders by size and profitability. That’s why from now on no idea is taboo anymore."
In addition to its active portfolio policy, innogy is particularly focused on being a cost leader in order to sustainably improve the company's profitability and overall performance. The stated objective is to become best in class at all operational levels. Consequently, a much stronger performance culture is set to be established across all segments.