The Testing, Inspection and Certification (TIC) market is assessed at approximately € 200 to € 250 billion and is experiencing healthy growth supported by increasing government regulations, industry-specific standards, increased outsourcing and ESG awareness. It remains fairly fragmented, with local players accounting for 60% of the outsourced market, which presents opportunities for selectively acquiring and integrating players in key segments. As such, and depending on the end markets in which the TIC company is active, it remains relatively unaffected by economic cycles but impacted by major economic trends such as limited availability of qualified labour, digitalisation and ESG.
Although the attractiveness of the TIC market varies significantly across end markets and industry verticals, Kiwa currently operates in a number of attractive verticals: Agriculture and Food, Construction and Infrastructure and Renewable Energy to name the biggest ones.
In the second half of 2023 and with a view to grow ambitiously, Kiwa validated its growth strategy, which includes several clearly defined strategic priorities in order to reach their performance ambition. Kiwa will be using the first few months of 2024 to further deep dive into these strategic themes and translate the revised strategy into action plans.
2023 signified a next step change in Kiwa’s growth with an increase in revenues of 20% compared to 2022, further strengthening its position in the global TIC market. These achievements represent the execution of a successful inorganic growth strategy focused on expanding the service portfolio and geographical network in certain geographies and business sectors on a global scale.
Operational priorities for Kiwa were centered around the successful integration of acquired businesses and achieving good performance in the existing businesses. The integration of recent acquisitions Vinçotte and Intega into Kiwa have been successfully completed and both acquisitions can be considered positive as they have made a good contribution to the 2023 result. Furthermore, the actions taken as part of the ReFresh programme, aiming to right-size underperforming business units, are paying off with almost all regions improving in line with expectations.
To enable synergies, the new ERP platform (Flow!) continues to be rolled out across the organisation. This company-wide business transformation and harmonisation programme aims to further digitalise service delivery and support Kiwa professionals in their work. During the course of 2023, the programme was rolled out in the Netherlands, Sweden, UK and Germany, while further roll-out in Sweden, Belgium and USA are scheduled for 2024.
As part of the consolidation in the market and to further strengthen its position in certain geographies and business segments, several smaller acquisitions have been made in 2023 such as Metrex (Estonia), QCSE (Australia), BASEC (UK), APS and Brown Intertec (US) and GHMT (Germany). Shareholding was increased in Cobico (Poland), NIBE (The Netherlands) and ExTEL Energy (Taiwan).
In August 2023, SHV purchased the remaining shares of Kiwa and became the sole shareholder. Furthermore, a change of leadership took place as of 1 October, whereby Paul Hesselink stepped down as CEO and was succeeded by Luc Leroy.
Kiwa’s outlook remains unaffected supported by said fundamentals. In 2024, Kiwa plans to establish a solid foundation for further growth, amongst others by investing in local and central functions and setting-up a regional structure in North America, while implementing the revised growth strategy throughout the company.
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