Testing, Inspection, and Certification (TIC) are vital services that ensure products, systems, and services comply with quality, safety, and regulatory standards. The global TIC market, valued at approximately € 200 to € 250 billion, is growing faster than Global Domestic Product (GDP). This growth is driven by several factors including a greater focus on customer safety and product quality; increasing regulatory compliance and industry-specific standards; a growing emphasis on sustainability and environmental impact; and a rise in the outsourcing of TIC services.
Kiwa is a global TIC company that operates across a wide range of end markets, some of which serve global value chains while others are more locally focused. The market remains relatively fragmented, with local players accounting for about 60% of the outsourced segment. This fragmentation does, however, offer opportunities for consolidation. As a result, Mergers and Acquisitions (M&A) activity has increased, driven by steady organic growth and resilient earning power. This has pushed valuations to record highs, with transaction multiples rising by 10% to 20% in recent years.
In 2024, Kiwa completed an extensive review of its growth strategy, identifying eight key strategic themes that align with its long-term performance goals. These themes include a focus on specific sectors, end markets, and global value chains. Moving forward, the Group will organize its operations around these themes while refining the growth strategy within each sector.
The Group has also updated its M&A strategy to prioritize future acquisitions in targeted regions. The aim is to approach the identified sectors and value chains on a truly global scale, while also establishing local leadership in selected end markets.
2024 marked a significant milestone in Kiwa’s ongoing growth, with the company generating revenues of € 1.5 billion – an impressive 10% increase on 2023. This success, which further strengthened the Group’s position in the global TIC market, was directly driven by a strong organic growth of 8%, as well as an effective inorganic growth strategy.
At the start of the year, the company bolstered its leadership to better support long-term strategic objectives. Operational priorities focused on optimizing performance within the existing business while building a strong foundation for further growth. The ReFresh program, designed to realign underperforming units, continued at pace after a successful 2023 when it achieved a marked increase in EBITDA. The restructuring or divestment of loss-making units also made good progress.
To streamline business processes and create synergies across the organization, Kiwa also continued to implement Flow! – a new, company-wide ERP system. After reinforcing project governance over the course of the year, a review of the project plan and final objectives led to two key adjustments. First, the system's primary focus shifted to standardizing business processes rather than emphasizing ICT tooling. Second, a more standardized approach to implementation marked a shift away from tailored local solutions. In the meantime, the roll-out in Sweden is underway with Belgium scheduled to begin early next year.
In terms of M&A, Kiwa reached an agreement in May to acquire NQA, a certification business in the US, UK and China. NQA offers wide-ranging synergies and provides Kiwa with a strong platform for further growth. A number of other acquisitions were also successfully completed, including EQS (Portugal), Agrisyst (Netherlands), PI Suzhou (China), ET (Germany), Geoscan (Canada), Browne (USA), and Wergeland (Norway), adding an additional € 177 million revenues on a full year basis.
Overall, the future outlook remains stable, supported by strong market fundamentals. Kiwa continues to contribute to a safer and more sustainable world, while steadily advancing its goal of evolving into a top-10 player in the global TIC market. This will be achieved by executing its growth strategy, enhancing operational performance, and leveraging M&A opportunities. A key priority will be the successful integration of NQA into wider operations, ensuring that the synergies and opportunities outlined in the business case are fully realized.
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