Severoceska Energetika
is one of the most famous companies in the Czech
Republic, could you give us a brief introduction
to the recent history of the company?
First of all, thank you for your visit and that
you found time to visit our city. Our company
has its headquarters in a small town, called Decín
right at the border with Germany. This part of
the country is industrially developed and tourists
frequently visit a part of it. Over the past 110
years Severoceska Energetika had its headquarters
in Decín. This year there have been big
changes in our company. This is the first year
when there is a competition between energy suppliers
and as a result we have found two new clients
who buy our electricity outside of the region.
This is for the first time for 110 years, so its
big news for us. In the year 2003 we expect the
second part of the liberalisation of the energy
sector to take place, which means that much more
clients will have the right to choose their power
supplier. As you can see, these days and weeks
are very hectic for us. Many contracts ended by
the end of 2002 and most of them had to be renegotiated
on the basis of the new rules set by the liberalisation
plans of the Government and now we have new clients
from different parts of the Czech Republic. During
this time, which was full of changes for us, came
the floods. It affected many territories that
we supply with electricity. We are lucky, because
we managed to turn off most of the machines alongside
the river Labe and that after the floods we managed
to turn on everything in time. It was a very difficult
situation and it is important to note that fortunately
no tragedies happened. We helped a lot of our
clients during that time and I hope this won´t
be forgotten and that they will be happy to stay
our customers in the next years too.
You are operating in a highly industrial area.
Can you tell us about your present and future
clients that you are just starting to work with?
Out of our most important clients, I would like
to mention Uhelné Spolecnosti whose headquarters
are in Most and Chomutov. Another big and important
client for us is a paper factory in Štetí,
Chemopetrol in Litvínov as well as Lovochemie
in Lovosice, the Czech Railways and in Decín
our most important client is company called Alcan
which produces aluminium profiles. These clients
I have just mentioned buy almost one third of
our energy that makes our company very sensitive
to the lost of any of our important clients. We
already know, that some of them will be supplied
by our competitors, most probably CEZ, who will
at the same time become our owner. You can see
on these examples that the Czech energy environment
is very turbulent and the process of liberalisation
of our industry started the re-structuralization
of our industry. At the moment there are eight
electricity suppliers in the Czech Republic. Ours
is the third biggest and we all buy electricity
from CEZ, but we are happy to be able to buy energy
also from other, independent companies. That means
that the liberalisation has brought changes not
only for the suppliers but also for the clients
- buyer.
How has been your financial results for the
last years and how have you been preparing yourself
for the liberalisation of the market?
I don´t want to talk about numbers because,
you can find them in our annual report. Regarding
the financial situation of the company I would
like to say that it is improving on a yearly basis
for the last ten years. We were selling more and
more electricity every year; I am talking about
the sale of electricity in technical measurements.
Very often people say that the suppliers are more
and more expensive every year and it´s true,
to a certain extent. In certain parts of the industry
we are more expensive but our good financial situation
is also thanks to the better sell of electricity
in technical measurement. We also have to mention
that we are getting better by reducing the costs.
Several years ago we had 2200 employees and today
we have 1500. If you look at our yearly reports,
you will see that we have been continuously reducing
costs. Right now I believe that our traders will
be successful and we will sell all the electricity
we have prepared.
What are the steps for Severoceská
Energetika to be competitive and how competitive
you will be both in the country but also in the
region?
Right now we can´t do anything else, we are
in a situation when we really have to fight for
every client. Our region is very interesting for
our competitors because it is big and potential
consumers. Every supplier is trying to get a share
of the market here, because for example in the south
of the Czech Republic there are only two or four
clients and in our region there are 38. Next year
there will be another 60 new clients who can select
their supplier. Of course 90 clients out of the
whole number of 1500 might not seem a lot, but as
I mentioned before they really buy big quantities.
We have a special approach to our clients. We have
been working with them for more then 30 years, which
means that we know them very well and we know what
we can do for them. The way we offer them our electricity
is the most efficient for them from the point of
view of their costs. We offer them not only electricity
but also support by other services. These services
include maintenance of machines, communication and
transfer of data and for our communication services
we offered our clients web portal hosting also.
We are the first of the eight suppliers who offered
web-based services. We do our best to be competitive,
but on the other hand we have to realise that our
clients, after maybe ten years, will be completely
free in choosing their supplier and of course it´s
normal they want to take advantage of it. I hope
that if we lose one of our clients he will come
back to us very soon. |
What is your strategy?
How will you adapt to the new rules of the game?
What are your expectations regarding the number
of clients?
Our strategic plan is based on two assumptions,
an optimistic and a pessimistic one. That is because
of the number of clients and the possibility that
they can change their suppliers is really big
in our region. To lose such a client is really
uncomfortable, of course, but it is not a disaster.
We simply don´t buy the amount of electricity
that the lost client was consuming. This is of
course a pessimistic approach, but in this case
we still have the opportunity in the next two
years to convince such a client to come back to
us. The most optimistic point of view says that
in the next 3 years the consumption of energy
will raise around 2 percent in technical measurement
which is the same as the trial time of last years
and which also is the same according to our survey.
We also have to count with the possibility that
we would be left out of that increase and that
we won´t sell more energy and that we will
sell the same amount of energy as last year.
In the past you had a co-operation with the
French company Dalkia, what can you tell us about
that?
This was one of our strategic plans in 1995.
We wanted to find alternative ways of buying the
electricity not only from CEZ. We managed to have
more suppliers by supporting to build a new technology
in a company called Teplárna Ústí.
We started the project in 1996. The capacity of
producing energy in Teplárna Ústí
raised and in 1999 Teplárna Ústí
would supply us by more and more energy and the
project was going well. There was the liberalisation
coming up and we decided to sell Teplárna
Ústí to the most efficient buyer,
which was Dalkia. So now they maintain this power
station and we buy from them a certain amount
of electricity. We don´t count with another
project like this in the next years because there
is an over production in the Czech Republic. I
think that this situation is typical for the most
of Western Europe, I think that we sold Teplárna
Ústí at the right time. We are convinced
that Dalkia is better in maintaining Teplárna
Ústí then we are for the long experience
that they have.
How about other projects with the involvement
of foreign companies?
At this time we are focusing on surviving this
first year of the liberalisation process. Of course,
we are very intensively preparing for the next
stage of the liberalisation and for the integration
of the Czech electricity producers into one group.
In the close future we are focusing on infrastructure
developments, necessary for us to be able to supply
electricity to our clients. Mainly Liberec, Lovosice
and Žatec, those are the places where the
big industrial zones are with Japanese, French
and German investors. They are expecting the supply
of the electricity on time and we are forced to
develop our equipment in these regions because
of the demand and this is what we are focusing
on in the close future.
Will you also co-operate with TPCA, the new
French-Japanese project in the country?
In those regions there are many producers of
car parts. In Liberec there is a company called
Denso which produces air conditioners and it is
a big supplier to the whole of Europe. In Lovosice
and Žatec there will be new producers of
car parts. We don´t deal with anybody particularly
there, we deal with the people that are in charge
of the whole region. Of course these companies
are included among the ones that will contribute
to the 2 percent rise in our business plan and
that is the reason why we are putting an emphasis
to the developments there.
Can you tell us your personal point of view
regarding the future - the liberalisation and
the consolidation of the market in the Czech republic?
When I first had the interview with your colleagues
two years ago I was saying that Severoceská
Energetika will be part of another big producer
of energy that means that the process of liberalisation
will be finished. I am very unhappy to say that
this has not happened. Right now, the process
is still not finished. We will be witnessing next
year the sorting out of the relations between
big suppliers because big part of our shares belongs
to the German RWE and E-ON, but the majority is
still in the hands of the state and CEZ.
By the time I retire, I think and I hope that
there won´t be only eight suppliers in the
Czech Republic. Either if it´s liberalisation
or privatisation, it is slowly going to the concentration
of capital or I wish that after 110 years of tradition,
we will remain to be a successful company in Decin.
I hope that the region which is supplied by us
will be healthy and dynamic so that it will be
interesting for investors and I hope that everybody
will notice that from Decín it is only
100 kilometres to Prague and 60 kilometres to
Dresden. That means that we are really in the
centre of Europe. There is enough of space for
industrial development and this central European
space will be in the focus for the years to come.
15 years ago, for example we really wouldn ´t
think of dealing with Japanese, French, German
investors who are building here new factories.
That pleases us and I hope that this process is
not accidental and that it will continue.
As you know, our readers like to know where
our interviewees come from and what was their
professional background. Could you tell us that
regarding yourself?
I came here in 1975. I was a student of the Economic
University of Prague and I had a scholarship from
this company. So Severoceska Energetika is my big
love and I have never worked anywhere else before.
I had lots of positions in this company most of
all economic. The most interesting for me, if I
can remember, was logistic position and I was also
working in the financial department as the vice
director of financing and right now I have been
the CEO for several years. May be I am not the favourite
CEO for many people but this is the destiny of managers. |
