Interview: Bio-tech giant Novozymes to continue innovation, partnership with customers: new CEO
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E-mail Xinhua, May 28, 2013
Novozymes, the world's enzyme giant, vows to deliver sustainable growth on innovation and close partnership with customers, said the company's new CEO in a recent exclusive interview here with Xinhua.
"The fundamental strategy of Novozymes is to continue to invest in innovation. We spent 14 percent of the turnover on research and development and will continue to do so," said Peder Holk Nielsen, who has taken over the post of CEO from the retired Steen Riisgaard since April 1, 2013.
"As a company, we have delivered a lot of innovation to our customers and it is all about new products and new innovations that go out to our customers all over the world. That's the underlying driver and we expect that to continue in 2013." he said.
PARTNERSHIP WITH CUSTOMERS
Nielsen believes that the close partnership with customers will play a vital role in building future growth. Understanding the customers' need and turning insights to the innovative biological solutions are essential for Novozymes to accelerate into double-digit growth.
"By engaging with customers, you understand what they need. You also get enough insight to be able to find new ways of doing things. We want to change the world together with our customers and every bit of change is about new innovation." he said.
Despite the global economy in 2012 remained sluggish and fragile, Novozymes achieved strong growth. In fact, Novozymes made operating profit of 2,745 million Danish kroner (around 477 million U.S. dollars) in 2012, representing a 17 percent rise from the previous year.
Nielsen mentioned that the diversified portfolio was one of the key elements which made the company shielded from the global economic downturns.
"I think that basically it is because Novozymes has a couple of technologies that go into many different markets. Something is a bit depressed; other things are doing very well. On the average, we are probably more robust than the most companies are." He explained.
Headquartered in Bagsvaerd, some 10 kilometers north of Copenhagen, the company with a portfolio of over 700 products in 130 countries, pioneered in producing enzymes across a broad range of industries as household care, food, feed, bio energy and so on.
BIOFUELS TO POWER THE WORLD
High oil prices, limited resources, and environmental concerns are compelling the governments and consumers to turn to renewable energy sources. Biofuels is part of the solution that can help to significantly diversify transportation fuels.
"Our big plan is that farmers should produce the energy. Right now the best way of doing that, at least talking about the liquids fuels, is to convert farm waste into biofuels," said Nielsen.
According to a study by Bloomberg New Energy Finance in 2012, using 17.5 percent of agricultural residue available today as feedstock for biofuels production could generate as much as bio fuels to replace over 50 percent of forecast gasoline demand in 2030.
Actually, Novozymes has formed strategic partnership with Beta Renewables, a global leader in cellulosic bio fuels to build the world's largest cellulosic ethanol plant in Crescentino, Italy. Novozymes will provide the enzymes which enable cost-efficient conversion of biomass to ethanol.
Nielsen was confident that the large-scale commercialization of biofuels is taking off and bio fuels can eventually compete with the conventional gasoline on price.
"The plant (in Italy) will start operating continuously over the next month. In the U.S., there are a couple of demo plants that have been built into large commercial plants. Everyone is now waiting for them to start proving to us all what they can do in terms of product economics. We believe that they could be able to prove that biofuels are competitive to gasoline," he said.
CHINA BLUEPRINT
Nielsen pointed that China is a strong growth engine in the company's globalization strategy, given that China is the second largest national market for Novozymes, after the U.S. It opened first office in China in 1992 in Hong Kong and moved to Beijing in 1997. Novozymes represents one of the largest Danish investments in China with a total realized investment of more than 500 million U.S. dollars by 2012.
"China is a very interesting place and of course we see the changes in the Chinese economy and we hope obviously to grow faster than 10 percent in China, so china will have to take up a larger and larger piece of Novozymes revenue." Nielsen said.
With around 200 scientists and researchers, Novozymes' R&D Center in the Zhongguancun Science Park of Beijing is the first foreign invested biotech research institution in China. And the company expects to expand the staff and operations in China.
"We will also be more and more people in China. Today every fifth employees of Novozymes is a Chinese and I expect that in a period of five years there will be more people in China relatively speaking in Novozymes; so more customers, more sales and more people relatively to the company." he said.
Nielsen sees big opportunities and potentials in food and household care area in China. For example, it has entered strategic partnerships with the large detergent companies in China as Liby and Nice.
Novozymes' enzymes can replace traditional chemical ingredients, allowing manufacturers to produce laundry detergent that cleans well at low wash temperatures and in environmentally friendly manner.
As water is increasingly being recognized as a critical sustainable development issue, Nielsen believes that Novozymes' innovative biotech solutions could contribute the water-saving in China.
"Water is taking up a larger and larger piece of the agenda. In particular in China, there is a large textile industry. We have a lot of offerings for the textile industry which essentially reduces the requirements for rinses, so you don't have to rinse as much and that's where most of the water is spend," he said. Endi
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