There are great opportunities for growth on a global scale for the company, which has seen the acquisition of important new customers in the last period.
VIMI Fasteners boasts a solid global presence in the high-tech fasteners sector, serving its customers with over 200 million products every year in more than 300 plants worldwide. Recently, the company has introduced important organizational changes in order to better adapt itself to the technological evolution taking place in the reference markets.
How the company intends to successfully face the challenges of the market, was explained us by Marco Sargenti and Elia Bianco, respectively CEO and Sales & Marketing Director of the Company, thanks to an interesting Q&A, of which we report the details below:
a. You recently held a Capital Market Day to kick off a new season at VIMI. What investor feedback impressed you the most and why?
The Capital Market Day was an interesting opportunity to meet and discuss with investors, and we received positive and varied feedback on a variety of topics. More specifically, we received suggestions on how to better represent some of the topics discussed, such as how to communicate our business successes in a timely manner, how to provide additional information on cash flow generation and how to better detail the formation of EBITDA by individual group companies.
b. At Capital Market Day you emphasized how sales have now taken a new direction. Have you already achieved any important results in this respect? For example, how many more deals are you negotiating this year than in the past? In which market sector do your partners operate? Is it different for the stock exchange if you conclude a one-off contract or for a 10-year supply; what is the duration of the new contracts?
Yes, in the last months of 2021 we acquired three new major customers for heavy duty powertrain applications, industrial plants and automotive turbochargers for a total of more than 2 mln€/year of additional revenues already from 2022. These businesses are very resilient to technological change and should ensure continuity of demand for the next ten years.
As defined in the 2021-2024 strategic plan, the mid&heavy-duty powertrain, off-road and agriculture industrial sectors, together with the energy and infrastructure sectors, are the areas where Vimi Fasteners aims to increase its market presence for the benefit of continued sales growth. To achieve this goal, Vimi will continue to consolidate and enhance its current customer portfolio, as well as develop new customers in these strategic market sectors.
c. To what do you attribute your results? For example, is it your know-how combined with your competitiveness that helps you in this phase or rather the quality of your products and your ability to develop relationships with your customers?
In this 2021 the good commercial results obtained in terms of new orders, which will be reflected in the 2022 turnover, can be attributed to several factors such as the strengthening of the Sales & Marketing structure, the redefinition of the corporate strategy, contained in the 2021-2024 strategic plan and a renewed commercial effort to seize new market opportunities.
We are convinced that the new resources we will add to the sales team will make a significant contribution to the enhancement of our technological know-how and product quality in order to ensure continuity in the growth of our business.
d. Are being listed, having financial strength and a consistent history of generating cash flow factors that play in your favor in winning new contracts? And why do you think that is?
Vimi Fasteners is a solid company with the ability to generate significant cash flow on an ongoing basis. This ownership has undoubtedly helped us, even in these difficult pandemic years, to receive orders from new customers who want to establish long-term relationships with strategic suppliers like Vimi Fasteners.
e. In the stock market we have noticed that there are many companies that trade at a premium on future expectations, while you trade at a discount on present results, why do you think that is?
Indeed, our share price does not fully reflect the positive economic and financial results of the 2021 half-yearly report. We questioned on this and decided, as a first action, to be closer to our investors, committing to provide a communication, on a quarterly basis, more extensive and structured. We also decided on the 2021-2024 dividend policy which we communicated to shareholders and potential investors. The fact remains that today Vimi’s stock is largely undervalued and this represents a great opportunity for investors who decide to invest in the company’s growth plan.
f. Does Italy’s Recovery Plan (PNRR) funds-driven plan benefit you in any way?
We believe so. The next five years will be characterised by strong investments in the infrastructure, industrial and power generation sectors in which Vimi has historically had a strong presence. PNRR funds will be provided to European companies and European suppliers who can contribute significant expertise and deliver products in a short timeframe. Vimi Fasteners is ready to take on this challenge, which will allow it to make full use of its production capacity, recently increased with the expansion of the Novellara plant.
g. Going back to the industry, what types of products will be in demand on the market in the coming years and why do you feel you can respond to those demands better than others?
In the last few years, in our reference sectors, we have witnessed a continuous demand for increased product performance and the willingness of the supplier to solve the most varied problems with the customer through co-engineering and co-design. In addition, an increasingly high level of service is required. These are the characteristics that distinguish Vimi Fasteners and that customers recognize us! These strengths also represent our competitive advantage over our competitors and allow us to look to the future with confidence even in this time of great technological change.
h. In your plans, in addition to organic growth, there has always been acquisition. Are you thinking about how to accelerate the process of company growth also through M&A opportunities?
As we communicated to investors during our Capital Market Day, our strategy is to improve our financial indicators before proceeding with new acquisitions. However, I can say that we have never stopped scouting for potential M&A deals, and we will continue to do it so in the coming year.
