Sales increased well above the market growth, further reinforcing Gom’s top 3 position. Our sector-specific approach was very successful in terms of acquiring new orders and client retention. However, profit lagged behind our expectations and ambitions.

To Gom, 2018 was the year of switching to market-segmented business units. This allows us to better serve the sectors healthcare, hospitality, education, offices, food & industry and specialised cleaning. Although we have not become active in the hotel sector until 2017, we had conquered a robust market position by 2018.

Operational excellence, profiling and visibility, and innovation were spearheads, also in the past year. Setting up the organizational structure around the six specialist fields was a key focus. This concerns a fundamental organisational change affecting the jobs of about 40% of our employees. During this process, we specifically highlighted operational excellence. However, in some places, this was temporarily under pressure. The new management teams have specified for each specialist field the optimal fit of our service provision with our clients’ requirements. We also specified how our new propositions can add even more value to our clients’ value chain.

The new brand campaign 'Ongewoon Schoon' was launched in the second half of 2018 to make further steps in the positioning and visibility as a sector specialist.

Launching a new waste concept and Optim-eyes are key outcomes of our commitment to innovation. Optim-eyes converges the various definitions of clean - technical quality, the clean experience and the importance of clean - into a single measurement system. The system gives more insight into the options for optimizing the clean experience and to better match our service provision with our clients’ requirements and preferences.

Like other divisions, Gom is confronted with increasing scarcity in the labour market. Finding good personnel needs more effort. This is an additional concern now that clients continue to increase their expectations. Our quality and speed in the operations are essential, but our ability to provide advice is also a key factor.

On the other hand, this trend offers our employees new opportunities to develop in their work. We also see opportunities for job carving, for example in healthcare, where our employees may be able to take over some tasks from care workers.

From a 2018 survey, we found that our employees rate their job satisfaction with a score of 7.3. Our ageing workforce is a key point of attention. With platforms such as ‘How comfortable are you with your work?’, we show our commitment to sustainable employability. In 2018, we launched our culture programme ‘Clean Makes You Happy’, focusing on the collaboration between field workers and office workers. The various employees get to know each other better, gaining a better understanding of each other’s work processes and can support each other when necessary. This year, we will review how to further scale up the programme.

A point of attention for the near future is the increasing internationalisation of the market. Multinationals increasingly choose suppliers with worldwide operations. International property parties positioning themselves as soft-service providers can benefit from this trend. However, Gom sees plenty of opportunities for further growth in the coming year based on the sector-specialist approach in various sub-markets. The steps we have taken to innovate our service provision and to increase our reputation are a good basis to further solidify our market position as a sector specialist.

In 2018, the specialist business units of Trigion (Hoffmann, AlarmServiceCentrale, Axxicom Airport Caddy en Safety Group) have shown positive development both in terms of growth and result. Unfortunately, due to decreasing sales of Trigion Beveiliging and Services, the overall financial result fell below target.

However, the division was successful in retention and acquisition of new orders. For example, we are very pleased with the renewed contract of Axxicom Airport Caddy for services to Passengers with Reduced Mobility (PRM) at Schiphol Airport. Our service provision plays a key role in Schiphol’s strategy to centre on the client. Schiphol’s focus on improving on-time delivery and centering on client preferences gives Axxicom Airport Caddy the opportunity to contribute to Schiphol’s objectives based on an updated organisation model.

Last year, Trigion Beveiliging was very committed to operational excellence and simultaneously embedded separate account management at a deeper level. 2018 was a turbulent year. The CLA negotiations for private security staff resulted into actions that affected some of our clients in the third quarter. The new CLA is in effect until 2023 and has calmed the sector. The CLA incorporates a substantial wage increase. This shows that the parties involved have recognised the skills of security staff. However, simultaneously, the increased payroll cost is a concern in the shrinking market for security personnel. We are negotiating with all our clients in an attempt to charge a mark-up for the wage raises.

In the personal security market, Trigion responds to the growing need for integral solutions, merging people, technology and risk management in order to realise better security and higher efficiency. Our service Trigion Next, launched in 2018, demonstrates this approach. This service enables us to provide remote support to security organisations. In addition, we developed an information services platform in the AlarmServiceCentrale to generate data intelligence. In Hoffmann, we invested in thought leadership concerning fraud, risk management and cyber security.

In 2018, the kick-off of Trigion 2.0 took place in the context of innovative organisation. We are working toward on-site teams who take responsibility for the results. Among other things, this means that employees do their part in planning and take responsibility for organising the work on their site. Four locations were selected to serve as a pilot for this new working method.
With this initiative, we expect to increase both customer satisfaction and employee satisfaction. In view of job market scarcity, it is more important than ever to bind and engage employees.

Meanwhile, we can see a positive trend: major tenders are not just based on price, but to a high degree also on quality. The coming year will be another major challenge, with the three largest security contracts in the country expiring.

Incluzio celebrated a special milestone in 2018: the five-year anniversary of the division. Another reason for joy was that the division closed the year in the black, with the exception of Incluzio Hollandse Kroon, ZorgCentrale.nl and Compartijn. Growth continued thanks to some new contracts and renewal of a number of existing contracts. The contract in Utrecht that was started in 2015 was renewed for the coming six years.

One of last year’s highlights was the launch of Buitengewoon, which was developed together with the other Facilicom Group divisions. This initiative combines Incluzio's competencies and experience in the area of social enterprise with the need of different facilities companies for good personnel. Via Buitengewoon, people with poor prospects on the job market are coached to find their way to a job. This is in line with Facilicom Group’s ambition to stay ahead in inclusive entrepreneurship.

We have noticed that an increasing number of municipal authorities are embracing the model. It is based on having a single budget, combining the use of community teams with individual counselling that is immediately available to anyone without any official reference. This is a key growth opportunity for Incluzio. With our experience and our organisational structure that facilitates our employees in working more autonomously, delivering custom services and clearly reporting about the effects, we are capable of creating genuine added value.

The introduction of the General Data Protection Regulation (GDPR) has had major implications to Incluzio’s services, which often involve processing special personal data. The basic principles of the GDPR are in line with our principle of talking with people rather than about people. When implementing the new rules, we focused on our commitment to due care in processing personal data. Internal ambassadors and the so-called privacy triangle have played an important role in training the employees and continuously having this theme on the agenda at all levels in the Incluzio businesses. Our innovative approach was noticed. The Ministry of Home Affairs and the National Ombudsman have requested us for input about bottlenecks, opportunities and solutions concerning the General Data Protection Regulation.

Thanks to the IT investments of the past few years, the operational performance of ZorgCentrale.nl and other units has significantly improved. We are better able to deal with peaks, process reports/alerts quicker, and we deliver even higher quality. In the coming years, we will work on gradually making more use of IT opportunities in order to increase our impact and effectiveness, and to make our employees’ work even more fun.

An example of our commitment to innovative organisation is Club Verder. Under this name, employees get to work on practical issues and hot topics in the organisation, supported by the business development department. We had started up autonomous teams before in the home care businesses. At Axxicom and Cordaan Thuisdiensten, the employees can schedule their own work and agree their visits with their clients. According to an evaluation conducted by the Works Council, most of the employees are pleased about the new work method. It also provides added value to clients. Additionally, employees have ideas for improvements. A direct result is starting up pilots in which employees give active input about follow-up steps.

Next year will be exciting, in particular for ZorgCentrale.nl. The aim is to make this activity profitable. We are looking for ways to generate even more added value from the infrastructure of ZorgCentrale.nl for the other Incluzio services. At the same time, we will increase the visibility of the brand Incluzio, both toward the labour market and toward our potential and existing clients. We are convinced that our solutions are more relevant than ever before. This is why we aim to continue increasing our impact in the future.

The financial results of Facilicom Solutions are in line with the targets. Almost all business units contributed with a positive financial result.

In particular in the so-called hard services, Facilicom Solutions can look back on a commercially sound year. In 2018, we started new contracts with COA, ProRail and others. The portfolio of integral service provision has remained stable. Trigion Brand- en BeveiligingsTechniek (TBBT) has become part of Facilicom Solutions as from 2019.

Facilicom Solutions’ retention rate and client satisfaction rate are high. We are proud that we were rated the best facility management provider in the independent Provider Performance Survey of Hospitality Group.

Facilicom Solutions also has a great score in employee satisfaction. The sick leave rate was decreased from 7.5% to 4.5% in 2018. A point of attention is the labour market scarcity, which is especially urgent for technical personnel. In 2018, Facilicom Solutions started up a labour market campaign for recruiting Super Technicians. The employee referral programmes that allow our employees to introduce new colleagues are continued.
In addition, career development is a continuous point of attention within Facilicom Solutions. Apart from the opportunity to grow into management level, employees are also given room to develop in terms of specialist field content.

The implementation of the Enterprise Resource Planning system (ERP) within Facilicom Solutions is on schedule. Furthermore, a leadership programme is ongoing at various levels in the division. We started up various innovation projects in order to further improve operational excellence. Recently, we launched pilots with Augmented Reality to provide remote support to installation engineers, allowing them to work better and faster. The initial
results are very promising.

One of our ambitions is to reinforce collaboration within Facilicom Solutions and with other divisions. This mainly serves to make better use of cross-selling opportunities. The internal and external positioning of Facilicom Solutions is a key point of attention in the coming period. Our highlight for the coming year is our unique added value, for example concerning making property more sustainable.

Facilicom Belgium has developed favourably in operational excellence during 2018. The new management team, which in 2017 mainly concentrated on client focus, managed to pull the organisation in a positive flow. Such developments have not yet resulted in a significantly better financial result overall for the full financial year. However, in the last quarter of 2018, we detected the first signs of structural improvements.

The updates to Facilicom Belgium’s organisational structure as started in 2017 have been further implemented last year. The roles within business control were reallocated to streamline the processes within all entities with a multi-disciplinary approach. The staffing of the central marketing and sales department was aligned and the team has undertaken various activities in order to reinforce the visibility of the brands of Facilicom Belgium. This includes the development of a new corporate website.

There are also positive developments in employee satisfaction at Facilicom Belgium. The scores in the recent employee satisfaction survey were above the benchmark with an average of 7.35. Additionally, we achieved progress in inclusive entrepreneurship.

With our internal prevention service, we have made new steps in the implementation of the security culture within Facilicom Belgium. The extension of our ISO and VCA certification shows that this is well in order.

Also when it comes to client satisfaction, we had a great year. The retention rate in Prorest, Trigion and Gom was high, as in earlier years. We see a full range of opportunities to work for international companies in Belgium outsourcing activities. Such companies are looking for innovative services with added value to their business. The expectation is that the collaboration with the various government services will develop into a long-term strategic partnership.

In the coming period, we are focusing more on data tools, machine learning and predictive analysis. This gives us more insight into our clients’ activities. This enables us to more pro-actively respond to new requests and wishes, and to optimally match our service provision to the customer experience. Our technological expertise also contributes to the support of clients with buildings that can be developed into smart buildings. Additionally, we explore the options of smart technology to further improve our service provision to all our clients. With our data-driven service provision and sustainable solutions, we expect to develop an even stronger market position in the coming year.

Facilicom has significantly grown in both the United Kingdom and Ireland in the past two years. Unfortunately, the financial results have lagged behind. In the past year, Facilicom UK has made significant investments in the internal strategy development. In 2019, we will launch specific activities to realise the desired future scenarios. The activities are supported by the management and are performed by the employees that volunteer as owners of specific actions. This approach is in line with our commitment to innovative organisation and is conducive to a higher degree of engagement of our employees in the organisation.

Just like the Dutch and Belgian divisions, Facilicom UK is also confronted with the labour market scarcity. In particular in security, finding good employees is challenging. This is why we are making more use of temporary agency workers than we would actually like. At the same time, wages in the United Kingdom and Ireland show substantial year-on-year increases. This has created a challenge in negotiating a mark-up for wage development with our clients.

Naturally, the imminent threat of the Brexit is a key point of attention. Unemployment in the United Kingdom is historically low. Additionally, a hard Brexit will impede inflow of foreign employees. This will also be a substantial challenge for Facilicom UK. We have seen British companies, especially in the financial sector, anticipate a hard Brexit by transferring activities to the continent. This reduces Facilicom UK’s options to provide services to such organisations.

An unmistakably hopeful sign is that Facilicom UK won the Tomorrow’s FM Award last year. We won this prestigious award for facility management for the way we organised innovation in our operational business management and service provision. This innovative angle is a compliment to the entire Facilicom Group and this reinforces our confidence in the sound results we aim to achieve in the coming period.

The consolidated turnover increased by 2% in 2018 to 1,264 million euros. There were no acquisitions in 2018.

The operating profit (EBITA) decreased by 41% to 17.0 million euros and amounted to 1.3% of turnover. This is substantially below the forecast. The main cause of underperformance is the disappointing results of Trigion, in our divisions in Belgium, the United Kingdom and Ireland, and in cleaning in the Netherlands. Incluzio is around break-even for the first time. Facilicom Solutions (including Breijer) shows a healthy increase in the result. Albron also booked a fine result.

The net profit was affected because we have charged the full result of Compartijn to the income statement, we have written off part of the SAP automation system, and we have adjusted the goodwill. This substantially decreased the net profit after tax to 7.5 million euros. Facilicom Group's financial position continues to be very solid.

For 2019, we expect a slight improvement in the operational sales and result. Albron’s contribution will no longer be consolidated. We continue to focus on our employees and clients and we further invest in technology that improves the business.

To ensure optimal risk management, we chart relevant risks and we implement measures for on-time, adequate mitigation and control. We take into account the risks that may affect our short-term as well as our long-term operating results. Every four weeks, we discuss the relevant risks and the associated corrective measures during the business reviews. As set out extensively in the notes to the annual financial statements (add link to the notes to the annual financial statements), we apply the Result Development Measures Methodology for this purpose.

Facilicom Group’s current strategy is based on four pillars that will retain their relevance in the future: operational excellence, data-driven work, market-driven focus and innovative organisation.

After a major shift toward customer excellence, we will use the coming period to develop a healthier balance in operational excellence and achieving the best results. The right working method - doing the right things the right way, and right first time - is ultimately the best way for optimal alignment of our service provision with our clients’ needs.

Facilicom Group will continue its commitment to market-driven operations, translating the relevant social development into
innovative solutions for our clients.

Part of our ambition to develop more market-driven operations is a stronger focus on data-driven work. Better application of business intelligence provides us with more management information, enabling optimal management of our internal processes. In our field, we see an increasing number of applications with a key technological component. This includes smart building management systems providing data to match security and cleaning to the actual use of the spaces. With the right data expertise, we can therefore also support our processes and services on client sites.

Our market focus also involves making steps in thought leadership. Our pay-off Happy People Make
Happy People is the leading theme in this respect. In the past, facility management was about issues such as adequate cleaning and security and decent food. Now the market expects facility management to contribute and add value to the organisation’s core business. As a company with a no-nonsense mentality, we are allowed to show more pride in what we mean to our clients. For example concerning the positive impact on labour productivity.

Facilicom Group is in the top twenty of large employers in the Netherlands, but we are not a household name. In view of the labour market scarcity, we also want consumers to have high awareness of our brands to enthuse them to work with us. We are increasingly communicating what we stand for and increase awareness of the various brands of Facilicom Group.

The label innovative organisation means we are quicker in initiating changes, innovations and challenges. As a large organisation, Facilicom Group is less agile than start-ups that are able to quickly respond to changing market conditions. Agility pilots enable us to gain experience with new ways of marketing innovative ideas. We give space to employees to show an entrepreneurial side within our concern. The development of Buitengewoon resulted from an initiative of a few employees helping people with poor job prospects on the job market. This is a wonderful example of how this can work.

The commitment of people within the divisions and holding of Facilicom Group to working together in creating an inspiring living environment for everyone, and the wide range of initiatives we take based on this shared ambition, gives us the confidence that we will be able to further develop our strong market position in 2019.