Strategy

NCAB has a strategic plan to continue to grow with healthy profitability. The plan is divided into four parts: increase market share in segments Europe, USA and East, ensure profitability from existing customers, geographical expansion and market consolidation.

Increase market shares in segments Europe, USA and East

In several large countries including France, Italy, Germany and the U.S., NCAB still holds low market shares. NCAB believes that the Group can increase its market share in the respective countries through investments in the organization, for example by hiring new staff and establishing additional of offices in larger countries such as Germany and the U.S. to better cater to regional customers’ demands. These large countries and markets all still have significant domestic production of PCBs, from which NCAB aims to gain market shares as the domestic production is declining. The ambition to increase market shares through investments in the organization is expected to drive organic growth but also to continue to hold back the profitability levels to some degree, through increasing operating expenses.

Ensure profitability from existing customers

In markets where NCAB has a strong position, for example in segment Nordic Region, NCAB’s main focus is to deepen the relationships with existing customers to improve profitability. NCAB believes that the value of its proposition to customers can be improved by: focusing on the largest customers, creating global customer accounts and by generally increasing the share of wallet of PCBs. By proving the long-term value proposition to its larger customers, helping them to decrease total cost, NCAB can serve its customers at the same time as increasing profitability in its customer relationships. In general, the largest customers are the most profitable customers for NCAB to focus on as price levels tend to be higher once NCAB has been able to prove its long-term value.

By creating global customer accounts, NCAB can have a broad geographical reach, serve and receive orders from the same customer in several markets. Furthermore, NCAB will be less dependent on finding new customers when entering a new market. By entering customer projects early, for example, in the design process, NCAB can provide its entire service offering, enabling NCAB to take an increased share of wallet of PCBs and build a deeper customer relationship.

Geographical expansion

NCAB has a track record of entering new countries and markets through successful green field establishments in for example the UK and France. There are several large markets worldwide where NCAB has yet to establish local presence, including well-developed markets with many similarities to NCAB’s current main markets, for example the Benelux region, as well as large and growing markets and countries, as for example India and Malaysia. With its global expertise in the PCB market and well-established approach when entering new markets, NCAB deems itself to have a strong toolbox to establish green field expansions successfully.

Market consolidation

As NCAB is one of the largest advanced PCB traders in a fragmented market, the Company holds a strong position to drive market consolidation. NCAB has made several acquisitions in the recent years, including for example the U.S. expansion through the acquisition of P.D. Circuits Inc. followed by a bolt-on acquisition of M-Wave International LLC. With potential acquisition targets located both in markets where NCAB has yet to establish local presence as well as markets where NCAB has strong positions, there are possibilities to broaden the geographical footprint as well as increase market shares in existing markets through acquisitions. Potential synergies of acquisitions are mainly derived from economics of scale, i.e. being able to serve more customers without increasing operating expenses proportionally, and increased purchasing power towards manufacturers.