What is your view of the naval defence market in France and internationally?

In Europe, we are facing an economic and financial crisis which has repercussions on the Union’s countries’ tightly restricted defence budgets. The French Military Programming Law (MPL), passed in 2013, has maintained the schedule of the FREMM and Barracuda programmes. In the next few months and years, we will be ensuring that the MPL’s undertakings to preserve jobs and manufacturing in the strategic defence sector are being complied with. However, our vision of the market extends beyond France.

In addition to our traditional competitors, mainly European, there are now a number of highly competitive new contenders from emerging countries. In a multipolar world, a manufacturer like DCNS must fight on several fronts, have a global presence, assess its strengths and make the most of the necessary alliances. The naval defence market has been undergoing extensive changes during the last decade.Its centre of gravity has shifted to Asia, the Near and Middle East and also to South America. More than ever, world trade depends on sea transport with shipping lanes passing through straits and areas threatened by powerful geopolitical tensions. Navies now require multimission ships to defend their territories while at the same time protecting strategic routes and preserving their ocean resources. Bearing this in mind, from now on our product portfolio will include more modular ships that can be specifically adapted to meet operational needs. Many of our clients also call for their naval shipbuilding to be carried out locally, combining this with technology and expertise transfer to give them full control of their sovereignty. In the light of these far-reaching changes in our markets, DCNS must develop its industrial presence outside Europe.

“A manufacturer like DCNS must fight on several fronts, have a global presence, assess its strengths and make the most of the necessary alliances.”

How do you see the renewable marine energy market evolving?

The renewable marine energy (RME) market is rapidly growing, but this expansion varies according to various governments’ maturity with regard to this field. The International Energy Agency forecasts a (30% increase in demand by 2030. In the light of this, I am convinced that marine energies will contribute to solving some of the energy problems the world is now facing. This is why, in !””+, DCNS entered a new area of innovation and development. Although the marine turbine market is extremely dynamic, particularly in North America, we should not forget that of ocean thermal energy in the South East Asian and Caribbean seas. The RME market covers the whole globe.

How do you assess the 2014 fiscal year?

As far as naval defence is concerned, we delivered the FREMM Mohammed-VI to the Royal Moroccan Navy, we were chosen by Egypt to supply four GOWIND® corvettes and, last February, a multimission FREMM frigate. We also reached major industrial milestones in the French Navy Barracuda, Indian P&0 and Brazilian PROSUB programmes. We are on schedule with the M0# missile ballistic nuclear submarine (SSBN) adaptation programme, which represents the seagoing arm of France’s dissuasive forces. These major successes demonstrate our Group’s ability to offer solutions adapted to navies’ needs worldwide.

As far as RME is concerned, we have been chosen by the French Government to develop a pilot marine turbine farm in the Raz Blanchard and Europe has shown its confidence in us by choosing our ocean thermal energy generating project off Martinique. These projects will be international firsts. This being said, DCNS’ economic performance is no longer meeting shareholders’ expectations. The trend in financial results calls for a major change of direction to strengthen our performance, bringing us back to more profitable and sustainable development. We must get off to a new start, boost our competitivity and once again keep pace with international growth.

To meet these challenges, we can count onour differentiating assets in our core business, which hinge both on our presence and our competences associated with ships’ entire life cycles and our command of large-scale systems. Our capacity as a combat systems’ developer and integrator sets us apart from our competitors’ positions as more conventional shipbuilders (the design and construction of self-propelled hulls and warships).

What are your strategic priorities for the next few years?

Our priorities are organised around four strongly interdependent strategic tracks. The first of these is to pursue our profitable growth internationally with a clearly definedambition: to have sustainable industrialsites and partnerships that go beyond the conventional concept of merely exporting warships. The second track aims at reinforcing the Group’s operational performance by respecting our commitments in terms of leadtimes, cost and quality serving clients, both in France and on international markets. The third track concerns the renewable marine energy market, on which we must continue growing after an initial assessment of the investments made until now. Finally, our fourth strategic track involves ensuring that DCNS can sustainably provide and develop the resources needed to preserve France’s sovereignty.

DCNS has been developing its activities in renewable marine energies over the last five years. What are the Group’s ambitions in this field today?

DCNS has the means of becoming one of the world leaders in certain renewable marine energy segments. The Group has a solid foundation of activities and competencies in its naval defence core activity which opens up genuine opportunities for growth on these new markets. We will be drawing up a first assessment to identify the sectors which have reasonable chances of being competitive within five to ten years so that we can emerge from the restrictions of the subsidised market. Renewable marine energies will then be able to lead to profitable growth, which will ultimately create new jobs in the regions concerned.

“Apart from a long-term industrial presence, we must work on our product range and continue our international growth thanks to a tightly-knit team in France.”

What is your short-term roadmap?

With the new managerial team at my side, we have launched an offensive strategy designed to make us competitive again and grow. A plan to make immediate savings of 100 million involving the entire Group has been introduced. These cutbacks should stimulate our economic performance from 2015, without affecting our competences. An improvement plan was launched during the first half of 2015 with the aim of enhancing efficiency. It will enable the Group to become more competitive and cost efficient, thereby generating the resources that are essential for financing our growth.

What can leverage faster development for DCNS internationally?

First of all, DCNS can count on the major international programmes underway in Brazil, Egypt, India and Malaysia. Apart from this long-term industrial presence which must be speeded up, we must work on our product range, making it bigger and more modular. Greater emphasis should also be placed on our service offering and infrastructure services in discussions with clients who appreciate this kind of commitment in the field. Finally, our international growth will continue thanks to a tightly-knit team in France, built on the strong strategic relationships we have with our main French partners, particularly Thales and MBDA, but also the other partners in the naval sector.

You are working with a new team. Does this mark a turning point for DCNS?

The new management team and organisation, in place since January 2014, will enable the Group to be set on an active footing and give our four strategic tracks a dynamic launch.

With this rejuvenated team, combining experienced managers and new arrivals, I am confident that the Group has all the resources it needs to take up the challenges of operational excellence, competitivity and growth we have to face.