Ambius
Principal Geographies
- UK
- USA
- Netherlands
- France
- Sweden
- Belgium
Principal Activities
- Design and installation of indoor plant displays
Our Objective:
To leverage existing positions to become the premier creator of workplace ambience products and service
Strategic Priorities:
- Organic growth through new sales and sales productivity
- Focus on increasing operating profit margins
- Use Ambius brand to increase revenue per customer through product/service extensions
- Turnaround UK
The introduction of a new, global brand name – Ambius – for the former Tropical Plants division began and was rolled out successfully across 11 countries in 2007. However, the launch was much more than simply the introduction of a new name. Central to the roll out was the development of a new colleague and customer focused culture, and the introduction of new services such as ambient scenting, artwork and fresh fruit delivery. The service extensions offer the opportunity to create deeper customer relationships and boost organic growth.
Who puts up your Christmas tree? In North America Ambius installed over 5,500 Christmas trees in 2007. That’s more trees, tinsel, lights and decorations than ever before. Whether customers prefer traditional or contemporary display, our designers work in partnership with customers to create their ideal specification, the business designs, installs, removes and stores. Of course, Ambius does more in the winter holiday season. Seasonal displays as well as Valentine’s Day and Easter are all created. As the only national provider in North America, Ambius can create services for multiple location organisations, but with the flexibility to individualise locally.
Key Performance Indicators
| £m | Change vs 2006 | |
|---|---|---|
| Revenue | 112.4 | + 6.2% |
| Organic revenue | + 1.5% | |
| Operating profit | 9.1 | + 23.0% |
| Adjusted operating profit | 9.1 | -13.8% |
| Net adjusted margin | 8.1% | + 0.5% |
| Contract portfolio gain | 1.8 | -53.8% |
| New business wins | 7.6 | -10.6% |
| Net additions/reductions | 3.5 | + 6.1% |
| Acquisitions | 1.7 | -43.3% |
| Terminations | (11.0) | + 0.9% |
| Retention rate | 87.5% | + 0.4% |
Market Conditions
The overall market for tropical plants has historically grown in excess of GDP. The main markets of operation are at different stages of development with the US and the Netherlands more developed than the UK. All markets are highly fragmented with a large number of small operators, although the larger companies have a competitive advantage in terms of route density. Ambius currently has approximately 60,000 plus customers over 13 countries.
2007 Review
2007 was a significant year for the business. All 11 European countries in which we operate were rebranded to Ambius and North America will follow in the first quarter of 2008.
Ambius’ total revenue of £112.4 million for the full year represented an increase of 6.2% over 2006, generating adjusted operating profit of £9.1 million, an increase of 13.8% over prior year. Operating margin increased from 7.6% in 2006 to 8.1%, despite the £1.0 million of rebranding costs charged against operating costs.
The North American business, the division’s largest operation and representing 57% of 2007 revenues, continued to build on the solid progress achieved in 2006. This business is the only player in the market able to offer a national service to large, multi-site organisations. Revenue grew by 6.4% during the period, a result of a 2.0% increase in contract portfolio and a 10% increase in job sales. A combination of strict control on costs and record sales of higher-margin Christmas items generated a growth in profit of 17.3%.
With the exception of the UK, Europe delivered excellent performance growing revenue by 9.9% leading to profit improvement of 68.8%. Revenue and profit in the UK declined 5.6% and 29.2% respectively year on year but the new management team recruited in 2007 is making progress in addressing performance issues in this market. Quarterly revenue trends are now improving, although this has yet to show through to profits.
During the course of 2007, Ambius made a number of acquisitions for a consideration of £3.1 million. In addition, it has expanded its product and service offerings to include ambient scenting, art sales and rentals, fresh fruit baskets delivery and online order and delivery of fresh cut flowers in selected markets.
The business has some exposure to economic downturn in the US which could affect plant sales and customer retention in affected segments (e.g. financial institutions). However, despite weakened consumer confidence towards the end of 2007, Ambius produced record sales in the approach to Christmas. We are seeing less evidence of economic pressure in Europe. Brand extension services across the business will aim to offset any downturn in trading.
2008 Preview
The business has some exposure to economic downturn in the US which could affect plant sales and customer retention in affected segments (e.g. financial institutions). However, despite weakened consumer confidence towards the end of 2007, Ambius produced record sales in the approach to Christmas. We are seeing less evidence of economic pressure in Europe. Brand extension services across the business will aim to offset any downturn in trading.