Budapest Business Journal 23/12

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SPECIAL REPORT:

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SHARED SERVICE CENTERS

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JUNE 19, 2015 – JULY 02, 2015

2015.04.02. 18:29

VOL. 23. NUMBER 12

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NEWS

Analysts weigh Greek exit from eurozone Hungary and the region are not likely to feel direct impacts, but experts say the destabilizing effect of any decision by Greece to abandon the euro could cause problems here.

3

BUSINESS

Startups describe dream matches Founder finds funder, sparks fly, and a profitable relationship ensues.

The people behind some successful Hungarian startups share their stories of getting taken over by global concerns.

8

NEWS

Anti-immigrant fence eyed for Serb border

Maintaining Hungary’s position as a hub for shared service centers and business process outsourcing requires training to ensure a flexible workforce, says Bea Előd, head of the Citi Service Center, Budapest. 14

SOCIALITE

Ratcheting up its opposition to the European Union’s push to accept more immigrants, the government announces a plan to build a four-meter-high, 175-kilometer-long barrier to prevent illegal entry into Hungary.

5

BUSINESS

SPECIAL REPORT

Going for par wherever they are

Budapest a bargain office location

Capable, low-cost workers draw SSCs

Urban golfers use soft balls and unconventional targets to turn the city into their own private course.

Their odd variation on a traditional sport is quickly catching on in the streets of the capital.

18

While the cost of offices worldwide fell in 2014, Budapest remains one of the cheaper places in Europe to locate, and is especially attractive given the good infrastructure and workforce, according to a survey by DTZ. 9

Hungary’s phenomenal growth in centers that provide back-office services to global firms is attributed to many factors. But experts interviewed agree that the main attraction is the costeffective workforce.

12

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Budapest Business Journal | June 19 – July 02, 2015

3Special Report

BBJ

Shared service

SPECIAL REPORT:

Regional SSC salaries

centers

compared 15

Office market is

key to expansion

16

SSC boom continues

SHARED SERVICE CENTERS

and BPOs, The growth in SSCs which provide back−office no shows services worldwide, We investigate sign of abating. the phenomenon.

ADVERTISEMENT

BUSINESS JOURNAL BUDAPEST B

JUNE 19, 2015 – JULY 02, 2015

2015.04.02. 18:29

VOL. 23. NUMBER 12

HUF 1,250 | €5 | $6 | £3.5

HUNGARY’S PRACTICAL BUSINESS BI-WEEKLY SINCE 1992 | WWW.BBJ.HU

Serving the world

NEWS

Analysts weigh Greek exit from eurozone Hungary and the region are not likely to feel direct impacts, but experts say the destabilizing effect of any decision by Greece to abandon the euro could cause problems here.

3

Startups describe dream matches

NEWS

Anti-immigrant fence eyed for Serb border Ratcheting up its opposition to the European Union’s push to accept more immigrants, the government announces a plan to build a four-meter-high, 175-kilometer-long barrier to prevent illegal entry into Hungary. 5

BUSINESS

SOCIALITE

SPECIAL REPORT

Going for par wherever they are

Budapest a bargain office location

Capable, low-cost workers draw SSCs

Urban golfers use soft balls and unconventional targets to turn the city into their own private course.

Their odd variation on a traditional sport is quickly catching on in the streets of the capital.

18

While the cost of offices worldwide fell in 2014, Budapest remains one of the cheaper places in Europe to locate, and is especially attractive given the good infrastructure and workforce, according to a survey by DTZ. 9

Hungary’s phenomenal growth in centers that provide back-office services to global firms is attributed to many factors. But experts interviewed agree that the main attraction is the costeffective workforce.

12

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BUSINESS

Founder finds funder, sparks fly, and a profitable relationship ensues.

The people behind some successful Hungarian startups share their stories of getting taken over by global concerns.

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Maintaining Hungary’s position as a hub for shared service centers and business process outsourcing requires training to ensure a flexible workforce, says Bea Előd, head of the Citi Service Center, Budapest. 14

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Hilarious billboards are no laughing matter The billboards are hilarious: They warn immigrants to avoid taking work away from Hungarian citizens. They are also written in Hungarian, as if people fleeing desperate situations in the Middle East and North Africa will bother to learn the obscure language of a country that they are passing through on their journey to Western Europe.

The billboards are obviously aimed at Hungarians, meant to assure the average citizen that the ruling Fidesz party is really tough on immigration. It is hilarious that the government thinks people will not understand the true message, and the complete absurdity, of these signs, which are paid for by taxpayers. But the idea that immigrant bashing is good PR is not so funny.

Fidesz is not the first party in the world to assume a knee− jerk stance of “no” when it comes to immigration. Plenty of political factions in the United States and Europe like to push the idea that immigrants steal the jobs of locals and suck up entitlement programs. Perhaps that is why Fidesz is reportedly getting help in fomenting fear of immigrants from Arthur Finklestein, a New York−based consultant who has worked for the American Republican Party, promoting a host of neo−conservative platforms – including anti− immigrant campaigns.

Contrary to typical xenophobic propaganda, immigrants are generally shut out of the majority of the entitlement programs in their host country, and they often take the most menial, low−paying jobs – work that locals need done cheaply but don’t want to do themselves.

More importantly, immigrants can provide a young, eager workforce in countries where this is desperately needed. Due to improved health care and reduced birthrates, developed economies, including those of America and much of Europe, have a top−heavy demographic, with many old people who are retired or ready to retire, and fewer young people who can continue to work and pay into the state pension funds.

This is definitely the case in Hungary, where the population is steadily shrinking and getting older. Meanwhile, the majority of immigrants are young people, who willingly undergo hardships to reach their host country, simply because they want to work and make something of their lives. This is exactly the kind of person an aging country like Hungary needs, someone who will be paying into the pension fund and helping support retirees by working for the next 30−40 years.

Despite the reality, populists and demagogues find immigrants an easy scapegoat when they need to detract from more pressing issues that they would rather ignore.

In truth, the bigger worry is not the people coming into the country, but rather the people leaving. While most foreigners entering Hungary are just passing through, and their numbers are relatively small, emigration from this country has reached significant levels, and is growing steadily. The majority of those leaving Hungary are working−aged people seeking better opportunities elsewhere – and they include a lot of professionals. According to one estimate, roughly 1,000 medical doctors have been leaving Hungary every year for the last six years.

Turning around Hungary’s desperately ailing medical system to make doctors and nurses stay is a challenge that requires the kind of potentially unpopular sacrifices this government is notorious for avoiding. Reversing the brain drain among university students would mean undoing government efforts to seize more control over curriculums and to establish record−sized tuition fees for higher education.

The government should be addressing the real problems that make capable, productive people flee Hungary. Rather than demonizing foreigners, it would also be a wise idea to start encouraging immigration among those who could work and contribute to society, Instead we get these billboards, which are hilarious – but not very funny.

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At left is the water tower on Margaret Island in 1914. Above, the water tower is visible from the main venue, the Open-air stage of the Budapest Summer Festival, which started it’s season this month. See What’s On (page 20) for details.

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No Greek tragedy expected, for now If Greece actually does exit the eurozone, the region is not expected to suffer any heavy direct impact. But it is hard to foresee the knock−on effects to Hungary from potential turmoil elsewhere in Europe.

Parliament OKs revised budget plan

With a possible Greek exit (the so−called Grexit) from the Eurozone approaching, forecasts and scenarios are emerging from analysts about the possible effects it might have on member states’ economies. As for Hungary, and Central Eastern Europe in general, impacts may vary depending on the vulnerability of the various economies, but in general, analysts say that damage would most likely not be derived from direct economic relations but through the economies of other Western European countries. Ákos Kuti, senior analyst at Equilor, told the Budapest Business Journal that he could see no reason for a direct impact on the region’s economies and stock markets.

“Indirect effects, however, can only be estimated, as confidence in the unity of the eurozone would be at jeopardy if the Greek economy collapsed,” Kuti said. He explained that this would cause capital outflow from the region, thus interest and yield levels in the eurozone would increase, which in the end would hinder economic growth across the continent. This would be especially painful for Hungary, as the economic dynamics of Germany – the country’s most important business partner – might suffer a setback as well, which would eventually slow down Hungarian growth. Such indirect impacts were seen as a result of the Russian embargo in 2014, Kuti added.

Negative stock market movements would result in higher yields on Hungary’s state bond market and, in addition, the capital outflow would seriously weaken the Hungarian currency in the short−term.

Stock markets would experience selling pressure as an indirect effect.

“Building concerns surrounding Greece have caused a weakening of CEE local markets, which have moved in sympathy with peripheral spread widening,” London−based economists and strategists at Morgan Stanley said in a research note on June 16. “With this CEE sell−off being more closely related to sentiment channels, and not fundamental channels of contagion, we think value is

Photo: MTI/Lajos Soós

ZSÓFIA CZIFRA

The board shows the final vote as Parliament passes the main numbers for next year’s state budget and tax plan on June 16. On the revenue side, HUF 15.8 trillion is expected, while HUF 16.561 tln in expenditures is planned – which would put the deficit at HUF 761 billion.

The amendments to the original draft, submitted on May 13, include HUF 3.8 bln of extra expenditure for opening six new embassies, an additional HUF 5.6 bln for personal costs at various branches of the government, and a HUF 12 bln increase in the size of the investment fund. The amendment decreased the proposed size of the Country Protection Fund by HUF 30 bln to HUF 70 bln. No amendments were mentioned regarding the revenue plan, which calls for slight tax cuts. The budget bill must be assessed by the Fiscal Council before a final vote, due at the end of the month. It could become the first budget passed before the summer holidays. being created in CEE currencies, and in particular HUF.” The research note added that macro links between Greece and Hungary are “not of major concern”, and with Greece having been in recession for several years the importance of Greek trade has been declining.

MNB moves could protect forint “Of course, repercussions of a Grexit could go beyond the macro impact on Greece, and onto the broader euro area, which the forint would clearly be more sensitive to,” the note said.

However, even Morgan Stanley’s European economists and strategists believe that a Grexit is now “less likely to result in broad contagion, with stronger firewalls, less direct

exposure and better EU fundamentals all providing a cushion”.

With the longer−term eurozone outlook not negatively impacted, in their view, the outlook for the forint should not be too severely affected.

They also noted that direct banking/ financial links between Greece and Hungary are also not of major concern to the HUF outlook, though this is of more significance to SEE economies.

In the meantime, the Monetary Council of the National Bank of Hungary (MNB) has decided to replace the central bank’s two−week deposits with three−month, fixed−rate deposits as its main sterilization instrument, from September 23. The two−week deposit will remain part of the MNB’s toolbox, but in future the central bank will place restrictions on quantity,

using the auction method. Through the measure, the MNB aims to make purchases of government securities more attractive for banks, shifting their financing to the state instead of the central bank, while also increasing the credit supply to the real economy.

In the longer run (in the next one to two years), the new tool will significantly decrease the vulnerability of the Hungarian economy, due to the increase in the share of domestic financing, said Kuti. He emphasized, however, that until then, massive anomalies could be expected, because banks and investors need to prepare for the new financing structure. This might result in several investors leaving the Hungarian bond market, which could cause higher yields and a weaker forint in the following few months, Kuti summed up.

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04 News

Budapest Business Journal | June 19 – July 02, 2015

NEWS

Taxi drivers protest Uber

IN BRIEF Főgáz to take over E.ON, GDF Suez retail gas clients The state advanced in its foray into the energy market in June as it took over the business of two private natural gas providers and a third provider said it would give up its customers, creating another opening for a state takeover.

The Hungarian Energy and Utilities Regulatory Office (MEKH) on June 12 said it accepted an offer from state-owned Főgáz to take over the roughly 1.3 million retail customers of the local gas units of Germany’s E.ON and France’s GDF Suez, both of which had surrendered their “universal service provider” licenses. On June 15, eastern Hungarian regional gas supplier Tigáz requested the withdrawal of its license. Tigáz served almost 1.2 million customers and had operating losses of HUF 4.9 billion in 2014, as the government applied strict control on the prices of natural gas offered by universal service providers. Főgáz is the Budapestarea bridgehead into the gas market of the First National Utilities Company (ENKSZ). ENKSZ began operating on the gas market in April and will later launch on the electricity and district heating markets.

Hungarian environmentalists look to EC to dispute Paks Environmentalists in Hungary “hope the European Commission will rule that Hungary’s 20% share of the construction costs will be judged to be a direct subsidy, which is illegal under competition rules,” the BBC reported on June 12. Last year Russian President Vladimir Putin agreed to lend Hungary 80% of the estimated construction cost for the new nuclear reactor in Paks, which Hungary is expected to pay back with the electricity generated at the plant. The Hungarian Prime Minister’s Office declared the Paks expansion contracts confidential documents, following Hungarian NGO Energiaklubʼs request that the contracts be made publicly available. Despite the classification being challenged as contradicting Hungarian laws, Attila Aszódi, the commissioner in charge of the expansion of Hungary’s sole nuclear plant in Paks, said that making the contract details of the expansion confidential for 30 years was in accordance with both Hungarian and European Union laws.

Environmentalists in Hungary say the plan will plunge Hungary into debt, and produce expensive energy, especially given the falling cost of renewable energy sources. The government defended its decisions, saying the new reactors are needed to cover the growing energy demand and claiming they will make the country more energy independent.

Figures from Prime Minister Viktor “Orbán’s nuclear energy tsar” – as the BBC refers to commissioner Aszódi – suggest electricity from Paks would be 10 to 15% cheaper than solar.

FT: ‘Orbánomics’ stuns critics The Hungarian economy under Prime Minister Viktor Orbán grew faster than its EU peers in 2014, though critics say this happened in spite of Orbán’s measures, the Financial Times reported on June 11.

In 2014, the Hungarian economy grew 3.6%, and as of Q1 2015, it remains at 3.5%.

The paper referred to Hungary’s economic policies as ‘Orbánomics’. Since coming into power in 2010, Orbán has introduced a flat-rate income tax of 16%, forced utilities companies to cut household bills and imposed a crisis tax on the telecom, media and financial sectors, and even went so far as to force banks to repay €3 billion in compensation to debtors who took out foreign currency mortgages. Supporters say this has enabled Hungarians to spend more. Critics say the increase in spending happened despite Orbán’s efforts, and attributed it instead to an influx of funds from the EU and a rise in real wages from the global fall in oil prices. Both sides agree that the sustained growth won’t last, with the Miffs April prediction of a slowdown to 2.7% in 2015 and 2.3% in 2016.

Nomura expects Hungary’s CPI to grow further Driven by the surprise +0.5% year-onyear CPI in Hungary for May, analysts at Nomura believe the National Bank of Hungary (MNB) should consider a “new” inflation band target, a press release by the Japanese financial holding company revealed on June 10. Nomura had predicted a +0.1% y.o.y. CPI for May, following April’s -0.3%, which it attributed to a one month blip, with sustained growth occurring later. The profile, however, has now been shifted up, meaning inflation will be in sustainable positive territory from this point forward, according to the analysts. This new forecast anticipates core and headline CPI to converge at the lower half of the new target for next year. “We believe as long as CPI inflation over the outlook path remains within the target range and in the long end is in the lower half – as our forecast and the MNB’s last published one is – so it can continue cutting and rate hikes are difficult to see in the next year,” Nomura said.

European Court: Slot machine limits could go against EU rules The European Court of Justice on June 11 said Hungarian legislation prohibiting the operation of slot machines outside of

Hundreds of Hungarian taxi drivers hold a June 17 demonstration in downtown Budapest, in an attempt to express their opposition to San Francisco-based ride sharing service Uberʼs operations in the country. The Hungarian National Taxi Driverʼs Association is asking the government to put an end to what the association considers an illegal service, which it says has been cutting into the wages of taxi drivers since Uber first appeared in November 2014. casinos might be contrary to the European Union’s principle of the freedom to provide services, Hungarian news agency MTI reported. “National legislation, which authorizes the operation and playing of certain games of chance only in casinos constitutes a restriction on freedom to provide services,” the European Court said, regarding a matter referred to it by the Budapest Municipal Court. Ultimately, the Hungarian courts must decide the dispute, MTI noted.

MNB: Hungary’s April c/a surplus cut in half The current account surplus came to €493 million in April, halving from the previous month’s €955 mln, with external financing capacity – the combined balance of the current and capital accounts – coming to a surplus of €750 mln, €638 mln down from March, preliminary figures from the National Bank of Hungary (MNB) published on June 16 reveal. The April trade surplus in the current account fell by €292 mln from a month earlier to €803 mln, MNB said, adding that the trade balance of goods was less than half of its March level, falling €380 mln to €346 mln, while surplus from service trade rose €88 mln to €456 mln, including a net tourism surplus of €277 mln, up €92 mln from March. Data from the central bank suggest that income outflow due to foreign investors was €495 mln in April, some €26 mln more than in the preceding month, including €331 mln profit repatriation on FDI, up by €45 mln. Considering the capital account, net inflow of direct investments worth €630 mln in March turned to €325 mln outflow in April, MNB’s data reveals. The central

bank suggests this to be the result of net equity investment inflow of €132 mln, and net outflow of debt instruments in the amount of €458 mln as opposed to inflow of €1.077 billion in March. Capital inflow in EU transfers in April was less than twothirds of the previous month’s, at €258 mln as compared to €434 mln in March, preliminary figures show.

Ferber: Orbán has gone too far Hungary’s ruling party Fidesz is looking to gain power in fields beyond politics, such as local councils, and is even interfering in the operations of NGOs, Markus Ferber, a member of the Bureau of the European People’s Party, of which Fidesz is a member, told Hungarian weekly Figyelő on June 11. “I have personally expressed strong criticism many times regarding the measures of the Hungarian government,” the official said, adding that the issue of the “death penalty is not the first instance” in which he has voiced his opposition.

Ferber said he had also objected to the “new constitution, the media law and the mandates of constitutional judges. […]

These are all measures that are at the extreme end of the values of the European People’s Party, sometimes even outside of its values. Clearly, issues like these need to be discussed, and once we will need to say that it has been enough. I believe Orbán understood that he hit this very point with his ideas on the death penalty,” Ferber told the paper. “Unfortunately, opposition parties are weak in Hungary, therefore the governing party has the room to do things it would not be able to carry out in other democratic states,” the politician added.

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News 05

Budapest Business Journal | June 19 – July 02, 2015

Immigration issue sparks billboard war The Two−Tailed Dog Party was overwhelmed by the financial support for its crowdfunded campaign to oppose government messages that supposedly target immigrants.

Szijjártó speaks at the June 17 press conference about the fence.

Serb border fence eyed as obstacle to immigrants

CHRISTIAN KESZTHELYI

A government campaign to post Hungarian−language billboards warning immigrants to respect the country’s culture and not take jobs away from locals sparked surprising support for a counter campaign run by the often−absurdist Two−Tailed Dog Party (MKKP).

Within a week of the government billboards going up in early June, the MKKP was online seeking crowdfunding.

By mid−June, the party, which had been hoping to collect HUF 3 million, had raised more than HUF 32 mln.

Although the party has not finalized the messages of their billboards, suggestions posted on their Facebook page have included “If you are the Prime Minister of Hungary you have to respect our laws and regulations”, and “Sorry for our Prime Minister”.

The party says it will contract the billboard company of Lajos Simicska, the media oligarch who earlier this year had a very public separation with his long−time friend and supporter Prime Minister Viktor Orbán. But Two−Tailed Dog Party leader Gergő Kovács told the Budapest Business Journal that the only reason the MKKP had contracted Simicska was that his is the only company that is not closely linked to the ruling Fidesz party and still has the capacity to handle the work.

“We bought the billboards at a market price, receiving no discount. We did not want to receive any discounts on those,”

Above is a government billboard. Below is another, after being defaced.

Government opposing immigrants

Kovács said. “We did not want to appear as if we have been supported by a firm.

Apparently the market price MKKP received was better than that the government could get. Reports in the Hungarian media suggest that the government spent some HUF 300 mln on installing 1,000 billboards. MKKP says it is expecting to post close to 800 billboards for its HUF 32 mln.

While he said MKKP was initially surprised at the huge response to its crowdfunding campaign, he also said he understood the public’s frustration with the ruling party.

“It is obvious that the billboards are not about immigrants, but the government is trying to restore its popularity on the one hand and on the other hand distract Hungarian citizens about issues related to their party,” Kovács said.

The original billboards which sparked MKKP’s campaign were part of the government’s response to European Union efforts to get countries to agree to accept more immigrants. The government has said it is concerned that a flood of immigrants into the country brings with it threats of “terrorism” as well as threats to employment for Hungarian citizens.

The billboards posted by the government say: “If you come to Hungary you cannot take the jobs of Hungarians”, “If you come to Hungary you have to respect our culture”, and “If you come to Hungary you have to respect our laws and regulations.”

Opposition party Együtt (Together) openly encouraged people to deface the billboards, and many were vandalized within a day of being hung up. In the following days, the party’s activists, some voluntarily, confronted police who had been ordered to guard some of the government’s billboards.

Prime Minister Orbán said that the majority of Hungarians agree with the government that “immigration is dangerous”. He maintained that a “liberal minority”, which counters the viewpoint of the majority of Hungarians, carried out the defacing of the billboards.

Some 26 years after Hungary played a key role in beginning to dismantle the Berlin Wall, it is planning the first steps to erect its own fence on the Serbian border, to keep illegal immigrants out of the country.

Minister of Foreign Affairs and Trade Péter Szijjártó said on June 17 at a press conference that the Hungarian government had ordered Minister of Interior Sándor Pintér to carry out the preparations for the 175-km-long and fourmeter-high fence, adding that Pintér has a week’s time to do so.

Szijjártó stressed that the government is not violating any international laws with the measure. He added that prior to the decision, the Ministry of Interior conducted a survey among local farmers, and he claimed that a majority of those queried answered that illegal immigrants coming over the border constitute a serious issue.

Szijjártó said that the European Union is also trying to work out a solution for the issue of immigrants, but it seems to be a slow and lengthy process, and Hungary, as a country crucially affected by immigrants, cannot wait further.

Szijjártó promised that Hungarian officials will meet their Serbian counterparts at a Summit on July 1. “Naturally, we will give in depth information to our Serbian friends about the measure,” he said.

— Christian Keszthelyi

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Nitro Circus Live unleashes moto mayham The Global Action Sports Spectacle Debuts Its All-New Tour with Exciting Shows at Budapest Groupama Arena Nitro Circus Live kicked off its Nitro Circus – Moto Mayhem tour with a spectacular show in Budapest. For this all-new action sports event, 17-time X Games medalist and global superstar Travis Pastrana led over thirty of the world’s best athletes in freestyle motocross (FMX), BMX and more.

Befitting the tour’s name, the performances featured no shortage of high-octane thrills, including incredible displays of today’s biggest FMX tricks.

The star-studded lineup included

Pastrana, who rode in both Finland and Denmark for the first time, plus the world’s first triple backflipper and current X-Fighters champion Josh Sheehan and X-Games gold medalist Cam Sinclair.

Groundbreaking female athlete Jolene Van Vugt, the first woman ever to backflip a motorbike, also rode moto.

But she showed off Nitro’s irreverent side as well, taking a new motorized version of her signature Barbie car for a spin – and jumping it off a ramp. The shows included still more mechanized madness,

including pit bikes and even a mobility scooter.

Thanks to Nitro Circus’ brand new proprietary winch system, every conceivable action sports contraption imaginable also took flight, including trikes, tall bikes, a boogie board and even a wheeled lounge chair. Scooters got in the mix, too: Ryan Williams, who landed two amazing world firsts last month (triple backflip and 1080 frontflip), had both stadiums on their feet with his huge tricks. http://www.nitrocircus.com.

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2Business COMPANY NEWS Erste Group likely to acquire Citigroup’s Hungarian portfolio Although they are one of several contenders, anonymous sources say Erste Group is the frontrunner to secure Citigroup Inc.’s Hungarian retail portfolio, Reuters reported on June 12. Two sources informed Reuters that a decision had been made, one of which said the announcement would be made in one month. “We have expressed our interest. We are waiting for the outcome,” a spokesperson from Erste Group said in an official response to a query by Reuters. “We cannot disclose details about the sale of our retail business at this phase,” Citibank Hungary spokeswoman Éva Hencz said, but she also made it clear that “the sale does not include either our corporate portfolio or our Citi Service Center in Budapest”.

FDA extends review period for Richter’s cariprazine to Sept. 2015 The American Food and Drug Administration said it needs a threemonth extension to complete its review of data supporting the resubmission of the New Drug Application for cariprazine, Hungarian drugmaker Gedeon Richter and Dublin-headquartered peer Allergan, previously Actavis, said on June 16. Cariprazine is being reviewed for the treatment of schizophrenia ADVERTISEMENT

and for the acute treatment of manic or mixed episodes associated with bipolar I disorder in adults. Richter earlier expected the product to receive FDA approval for distribution in the United States by the end of Q2. At the beginning of January, the FDA acknowledged receipt of cariprazine.

In mid-January, Richter Gedeon announced successful tests of the antipsychotic drug cariprazine. “No treatment emergent adverse event was reported in more than 10% of the patients. The most frequent adverse events (incidence ≥5%) across both treatments groups were insomnia, headache, akathisia, worsening of schizophrenia symptoms, anxiety and somnolence,” the announcement said. Richter submitted the New Drug Application for cariprazine in late 2012 in the United States.

OTP agrees to acquire another Serbian bank The Serbian unit of Hungary’s OTP Bank signed an agreement to buy 100% of Serbian peer Findomestic Banka from its Italian owner, OTP announced on June 12. OTP said Findomestic Banka is a “stable, retail-oriented” bank with a 0.5% market share in Serbia. OTP expects the transaction to boost its market share in the country from 1.4% to 1.9%, bringing it closer to achieving optimum market size. Findomestic

EY Hungary elects new management The management of EY Hungary is being renewed as of July 1, with Botond Rencz (pictured) becoming the CEO and István Havas, the current holder of the position, becoming a senior partner responsible for some of the firm’s key corporate and governmental clients. “The current rejuvenation of the management is designed to serve the continuation of high quality services provided to our clients and the work we have been doing for the past years,” outgoing CEO Havas said. “I wish the best luck to the new management, and I will do anything I can as a senior partner to contribute to the further growth of the firm,” he added. In line with the firm’s long-term strategy, Zsuzsanna Bartha will be responsible for the auditing field, while Balázs Tüske will lead business advisory services.

has 26 branches, including seven in Belgrade, with approximately 90,000 clients. The acquisition will support the activity of OTP’s Serbian business in POS and credit card lending as well as in electronic services, the Hungarian bank said, adding that it would “seek further regional acquisition opportunities that

could contribute to shareholder value creation”.

HELL Energy inaugurates phase one of HUF 5.5 bln amusement park Hungarian energy drink producer HELL Energy on June 12 inaugurated the first

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Budapest Business Journal | June 19 – July 02, 2015

BAT, Tabán win concession to supply tobacco shops British American Tobacco (BAT) and Hungary’s Tabán Trafik will be awarded a concession to supply retail tobacco shops, Cabinet Chief János Lázár said at his regular weekly press conference on June 11. The two companies will act together as middlemen between manufacturers and retailers for the next few years, and the National Development Ministry has been authorized to enter into a contractual agreement with them, Lázár said. BAT and Tabán are expected to pay HUF 600 million to the state for the concession. The bill on the establishment of a centralized distribution company for tobacco products – approved by Parliament in mid-December – would cause the dismissal of 1,200 Hungarians who work in the business, Lajos Csizmadia, the spokesperson of the tobacco workers union (DDTSZ) told the Budapest Business Journal earlier.

Tata selected as site for NHK Spring plant Japan’s NHK Spring purchased eight hectares of land in the industrial park of Tata, northern Hungary, to establish a 10,000 sqm production hall which will provide employment for 100 people, the mayor of Tata József Michl said on June 17. The Japanese firm announced in March that it was planning to construct an automobile suspension plant in Hungary, with a capacity that would enable it to manufacture 3.5 million coil springs and 1.2 million stabilizers by 2020.

Dentons advises Adris grupa on €550 mln sale The chiefly Hungarian team of Dentons acted as advisors for Adris grupa in the sale of TDR and other entities within Adris Strategic Business Units Tobacco and Retail, including among others Istragrafika, Hrvatski duhani and the iNovine and Opresa retail chains, for a total enterprise value of €550 million. The transaction, which is currently subject to the approval of the Shareholders’ Assembly of Adris as well as customary competition clearances, is expected to close in September 2015, Dentons said. A team from Dentons’ offices in London and Milton Keynes supported the team in Budapest. “We are very proud to have had the opportunity to support Adris grupa on this historic transaction that secures the future of TDR’s Kanfanar plant.” Rob Irving, the new co-chair of Dentons’ Global Private Equity Group, said. “This deal is a great example of

Dentons’ ability to call upon lawyers located in CEE and the U.K., from a broad variety of disciplines, to advise on strategic cross-border matters in the South Eastern Europe region,” Irving added. The Budapest team recently joined Dentons from White & Case, along with approximately 50 local partners, associates and other professionals, to further strengthen Denton’s Corporate M&A and Private Equity offering in Hungary, the Central and South Eastern European region and Europe as a whole.

Suzuki to lower Hungarian capital 30% Japan’s Suzuki Motor Corporation is planning to reduce capital at its Hungarian unit by approximately 30%, precisely €156 million, and use the freed up resources for developments at other plants, Magyar Suzuki said.

The Hungarian subsidiary noted that shareholders approved the capital decrease. According to the firm Hungarian production will not be affected by the move in “any way”, and it will remain “substantially overcapitalized”. Net assets will remain more than 50% of total assets, which translates as “outstanding liquidity” within the automotive industry, Magyar Suzuki said. Its registered capital will be reduced from €303 mln to €213 mln.

Profit reserves will fall from about €218 mln to €153 mln, and capital reserves will drop from almost €5 mln to a little more than €3 mln.

OKI Systems increases turnover in Hungary by 46% The Hungarian unit of Japanese printer manufacturer OKI Systems saw revenue of more than HUF 1.5 billion in the fiscal year ending in March; this constitutes a rise of 46% compared to the previous year, Loránd Tamás, the company’s director for the region, said on June 9. The regional director said sales of consumable supplies account for 75-80% of the company’s revenue, which segment saw a y.o.y. growth of 57%. “We have over performed our expectation in the business year of 2014, due to the dedicated work of our team and partners,” the director said. “Seeing our results, we aimed for a growth of 16% for next year, which seems to be achievable considering the last two years,” he added.

Mondelēz brings the OREO cookie to Hungary Mondelēz International, Inc. is introducing OREO, the most popular sandwich cookie in the world, to Hungary from June, Mondelēz Hungary Kft. said in a press release on June 8.

“The introduction of the brand will be accompanied by a stronger than ever marketing campaign worthy of the cookie’s international reputation,” Gábor Mayer, managing and sales director at Mondelēz Hungaria said. According to Mayer, HUF 2 million has been set aside for marketing purposes in the coming months. The report also noted that OREO will be available in the most popular 44 g, 110 g and 176 g packages in Hungary. The company sells approximately 25 billion OREO units annually.

EXPERT OPINION

LNG – cold commodity, hot topic György Domokos Vargha Head of Wholesale & Origination MET INTERNATIONAL AG

T

he energy business has always been a hot topic. To remain competitive – just like in other businesses – you must constantly innovate.

LNG (Liquefied Natural Gas) is a traditional technical solution of the energy industry which has only recently transformed into a truly tradable commodity – to be treated with respect for multiple reasons. On one hand, technology is highly important – from condensing the natural gas to 1/600th of its volume, to cooling it down to -162 degrees Celsius, to loading and transporting it on LNG carriers, and then regasifying it. All these require state-of-the-art equipment that very few commodities do. On the other hand there is the sheer volume effect - one LNG cargo supplies 1-2% of Hungary’s total annual consumption, costing roughly €20 million. For these exact reasons the industry has traditionally been point-topoint, project-to-project supply since the 1960s between global majors and local producers. Since the beginning of the 21st century, the LNG trading industry came into being and has been influenced by shocks rather than trends, demanding a professional approach in every way.

of consumption in China and India as well, with each outpacing their own production capacity, which also led to increased demand for additional LNG shipments into these countries.

Due to these factors, upstream projects have dramatically sped up – particularly in Australia – tapping even the most costly exploration sites to start delivering by late 2015 and into 2016, just before the third shock – which is yet to be experienced – LNG exports from the United States.

With the shale oil and gas revolution, the United States possesses practically infinite natural gas reserves at unbeatable costs. Since shale gas is frequently a sideproduct of shale oil, the only real cost of the commodity is building the pipelines from the field and connecting those to the national and regional systems. With the technology becoming cheaper and cheaper and the required pipeline systems being developed, upstream costs are set to decrease making more and more shale oil and gas available. According to the liquefaction projects in the United States, the country is set to be an exporter of 50 mtpa (million tons per annum) by 2020. With its existing projects, Australia is expected to increase exports by an additional 70 mtpa by the end of 2017.

Just as a comparison: total LNG supply in the world was 250 mtpa in 2014 (of which Qatari supply was 77 mtpa). Total European natural gas demand is now ~350 mtpa, and Hungarian natural gas consumption amounts to 5-7 mtpa.

The first big wave of changes brought to The landscape is changing. In the upcoming the LNG industry started in the early 2000s, years the United States and Australia will when Qatari production was launched be dominant suppliers in the Atlantic and on the market. The volumes have been the Pacific basins, while Europe might increasing to 30% of the global market function as a buffer for any surplus LNG share in a 15 years ramp-up period, in the world. Whether this will bring price practically dominating the global LNG stability or even a globalized gas market market. Qatari LNG has all factors to are questions yet to be answered. succeed: incredibly cheap costs, excellent geographical location (exactly between What does all this mean to us in the region? two major consumer markets: Europe and With respect to Central and Eastern Europe the Far East), as well as proven Western there is no LNG terminal yet apart from technology and financial background. Poland, which has no significant connection Qatar quickly became “the LNG producer” to Czech Republic or Slovakia. The LNG of the world. terminal in Croatia exists on paper only, and LNG in the Black Sea is not a reality given The second shock was much more restrictions of the Bosporus channel. As unfortunate – due to the Fukushima nuclear such, LNG access to the region can only disaster in Japan in 2011, the Japanese originate from Western Europe. government decided to stop all nuclear power production in the country, replacing For a European natural gas player such as its energy needs with LNG-fired power MET Group, which has wide geographical plants. This event created an insatiable coverage in physical and virtual crossdemand in the country, resulting in a border capacities in the region as well global rush to find available LNG supplies as day-to-day transactions in Western from even the most remote locations, European natural gas hubs, connecting such as Trinidad & Tobago or Peru. The LNG with Central and Eastern European outcome: enormously high prices for both markets might be a real option to increase consumers and the LNG shipping trade supply security to its customers and as on a global scale. The only alternative to such, to fulfil its mission of implementing LNG imports for certain countries has been innovation in traditional European energy either very expensive fuel oil-based power markets. generation, or running the risk of blackouts in cities and factories. This sudden dash for LNG coincided with the rapid increase www.MET.com

NOTE: ALL ARTICLES MARKED EXPERT OPINIONS ARE PAID PROMOTIONAL CONTENT FOR WHICH THE BUDAPEST BUSINESS JOURNAL DOES NOT TAKE RESPONSIBILITY

phase of a HUF 5.5 billion amusement park, which features a go-cart track, a playground, beer garden, conference center and artificial turf pitch situated in Avalon Park in Miskolctapolca, in the Bükk mountains in northeast Hungary.

The park is expected to be completed in October, following the building of a 32room hotel and 15 cottages. The company said that its revenue nearly tripled to HUF 12.7 bln last year, including HUF 5.6 bln from exports. After-tax profit reached HUF 560 million.

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Budapest Business Journal | June 19 – July 02, 2015

Startups make the journey from Hungary to the world Successful local startup founders explain the important leap from sparking interest to obtaining big investment.

ZSÓFIA VÉGH

Several Hungarian IT startups have been bought up in the past few months by international firms on the lookout for fresh knowhow. What these businesses had in common was a global partner network and visibility on the international stage – musts for any startup aspiring to follow suit.

At a June 10 matchmaking event in Budapest, sponsored by the ICT Association of Hungary, Hungarian enterprises acquired by international players talked about how to go global.

“The fairy tale version of our story goes like this: I get a phone call, two days later I’m on my way to the United States; in two weeks’ time I sign the deal and a week later the company is at Tech Ranch,” Zoltán Prekopcsák, vice president of RapidMiner, an international Big Data handling company, told the audience. Prekopcsák was founder and CEO of Radoop, a data handling startup purchased by RapidMiner. “What people don’t see is that it took us years of partnership to reach this point,” he added.

IND Kft., an online and mobile banking software maker, had a one− year exclusive sales agreement with then client, now owner Misys, a U.K. financial service vendor, before the bigger firm bought the startup. “Sales figures were so good they decided to

József Nyíri, IND founder, now sounds happy to be working for Misys.

“What people don’t see is that it took us years of partnership to reach this point.” buy us up rather than share the profit,” said József Nyíri, a founder of IND and now an employee of Misys.

Another Big Data startup, SequenceIq, barely had to wait two months after its official opening to attract its dream partner, Hortonworks, a California− based data platform company, which

Péter Vityi, vice president of IVSZ. acquired the former company this April.

“We started to receive price quote requests when the product wasn’t even finished. That was when we thought we had found [out] something good,” Lajos Papp, a founder of SequenceIq said.

Why startups sell themselves But why should founders sell a startup with global potential? Growth in these companies is usually restricted unless they switch from local investors to international ones with deeper pockets, which is exactly what Prezi, the Hungarian presentation software maker did. European IT firms also

struggle from a lack of investor trust, while early−stage companies attract mostly angel investors, Gábor Vicze, head of IVSZ’s SME department told the Budapest Business Journal.

“It is useful to have experience in building and managing a company,” Péter Vityi, vice president of IVSZ also told the BBJ. Radoop and SentenceIq opted for acquisition as they soon learnt they had neither the business development nor the sales skills, and they lacked the knowledge or capacity to build a market in the United States, a key target for IT firms.

Mobile app developer Team Distinction – bought up by Skyscanner, a global search engine that allows travelers to compare flights, hotels and car hire firms – said yes to the buyout to reduce risks. “We swapped a startup with high growth potential and high risks for a big company with considerably less risks,” said Ákos Kapui, developer/founder.

The startup saw 100% annual growth in the past three years with a 50% profit margin, but the workload was so heavy that Kapui said he and his colleagues risked burnout.

While money may have been an important factor, strategic partnership and creative freedom weighed more during negotiations. “We received a great professional opportunity at Skyscanner, as opposed to being a small player within a big organization that might have offered a hundred times more,” Kapui said. “Getting a seat on the board was one important consideration for IND Kft. Yet the biggest reason for selling for all the above startups was the ability to go global. “Our main goal was that more people use our software in the world. Ever since we set up the company, that is what has driven us,” said IND founder Nyiry.

Hungarian startup Maven7 receives more investment The firm uses network science to provide businesses with useful data.

ZSUZSA SZABÓ

Maven7, a Hungarian start−up offering business analytics based on network science, announced on June 8 that it has raised more than $1.5 million in “Series A” funding, led by venture capital management firm Perion.

The funding is aimed at market expansion and further development of the firm’s business analytical tools.

Perion is a member of the Hungarian Venturio Group, with finances supported by JEREMIE, the European investment fund initiative. Perion says it intends to invest $16 million in promising Hungarian ventures, especially in the IT sector, during its current investment phase, ending this

year. Maven7 is the fourth investment in the venture capital management company’s portfolio.

Maven7 supports business decisions by transforming large amounts of hard−to−interpret data into actionable business intelligence to help strategic leaders make better−informed decisions. Based on the methodologies of network analysis and data mining, it has developed its own proprietary network mapping tools, including OrgMapper and Diktio Labs.

OrgMapper enables HR practitioners to make the human side of their business processes more manageable, predictable and measurable. The tool clearly maps and shows information that is otherwise very difficult or impossible to capture and convey in an organization. It basically gathers, measures and visualizes structural interrelations via organizational network analysis (ONA), and makes cooperation and communication patterns visible and manageable for

Among Maven7’s co-founders are some of the biggest names in network science, including award winning scientists Albert-László Barabási and Tamás Vicsek. business leaders. The software can reveal hidden informal employee networks, expose departmental and hierarchical links, uncover barriers to information flow, and identify key individuals who connect departments and products, or who are influential to their colleagues. Solving very specific problems, its five modules fit nicely into various types of organizational development projects.

Among Maven7’s co−founders are some of the biggest names in network science, including award winning

scientists Albert−László Barabási and Tamás Vicsek, through whom the Budapest and Boston−based start−up also has very close working relations with the prime academic think tanks of the discipline.

Barabási is the Robert Gray Dodge Professor of Network Science and a Professor at Northeastern University, where he directs the Center for Complex Network Research, and who, among other things teaches at the Department of Medicine at Harvard Medical School. A Hungarian−born native of Transylvania, he is often tipped as being the most likely candidate to be the next ethnic Hungarian Nobel laureate.

Maven7 opened its first overseas office in Boston last year, and has presence on the European, Latin American and U.S. markets.

The undertaking also raised more than $750,000 from Primus Capital, a venture capital seed fund, in 2014, putting the current total investment at more than $2.3 mln.

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this special report is sponsored by DTZ

THE PROPERTY ADVISER www.dtz.com +36 1 269 6999

Budapest, an attractive office location According to DTZ’s recently released Global Office Thermometer report, the annual USD cost of a workstation fell by 3.9% on average worldwide, and cost declines impact two-thirds of global office markets. Appreciation of the US dollar, weak growth in Europe, significant new supply in emerging markets, and intensification of space usage are listed as reasons for dropping costs.

Europe most expensive markets and CEE coverage for occupancy costs (annual per workstation in USD)

In Europe, on a city level, Moscow saw the sharpest fall in the USD price of workstation occupancy in 2014, as costs there dropped by a third on a USD basis. Other Eastern European cities, including Bucharest (25%), Bratislava (23%) and Prague (21%) also posted sharp declines.

CEE’s share in the global outsourcing market is growing rapidly, both in terms of the number of employees and the amount of occupied office space.

Budapest offers excellent occupancy conditions on the offi ce market, with stable and low-costs levels.

The Annual cost for one workstation in modern Budapest offi ce building is around USD 3,000, including rental levels and outgoings. With its mix of a relatively high supply of modern offi ce space, good infrastructural environment and access to a well-educated workforce, Budapest is a competitive location for outsourcing companies.

REAL ESTATE NEWS Kelly Services leases 600 sqm from Europa Capital, ConvergenCE Europa Capital and ConvergenCE recently acquired an office portfolio of approximately 30,000 sqm and have just leased 600 sqm of Kálvin Center (pictured) to Kelly Services, Inc., according to a June 15 press release.

“We are delighted that Kelly Services chose to move to Kálvin Center and will become one of our key tenants in the building. We are confident that Kelly Services will be satisfied with their new office area and look forward to continuing our working relationship for the foreseeable future,” said Csaba Zeley, Director of Asset Management at ConvergenCE.

inNove Business Park sold to investors Colliers International has completed work on its second logistics transaction this year, advising a private developer on the sale of the 18,000 sqm fully let prime inNove Business Park city logistics asset in Budapest; a deal that establishes a new benchmark for prime assets within this class according to the company. Colliers puts the industrial yield at 9.25%. The new owner of the building is an open-ended retail fund managed by Diófa Fund Management. Last year was the first in which investment grade logistics assets changed ownership after a five-year long dormant period, and now the

asset class appears to be on an upward curve according to Bence Vécsey, head of investment services at Colliers International Hungary.

In an earlier deal this year, Prologis purchased the M1 Business Park Hungary from CA Immo and Union Investment through the Prologis Targeted Europe Logistics Fund. The now re-named Prologis Park Budapest M1 comprises five facilities of 69,000 sqm.

“We are pleased to have been involved in this transaction as well as supporting CA Immo and Union Investment in selling one of the largest logistics facilities in Hungary to Prologis a few months ago,” added Vécsey.

Colliers sees increasing investment activity coupled with easing pressure on rents and a sharp drop in vacancy rates in the Budapest industrial and logistics market. “The long awaited recovery is finally visible and momentum is building on the back of strong leasing activity, pushing vacancy rates to a record low level since 2008.

Following strong leasing activity in 2014 (net absorption of 128,000 sqm was registered), vacancies in the Budapest logistics market dropped further to 14.5% by the end of Q1 2015, which today are even below those of the office market,” said Colliers.

Correction JLL was informed that it relayed incorrect data, which was published on Page 11 of the June 5-18 edition of the BBJ. The seller of InNove Busiess Park was identified incorrectly. The actual seller of the park should have been identified as InNove Business Park Kft.

BBJ

3Special Report Shared service centers Regional SSC salaries compared

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Office market is key to expansion

SSC boom continues

The growth in SSCs and BPOs, which provide back−office services worldwide, shows no sign of abating. We investigate the phenomenon.

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Budapest Business Journal | June 19 – July 02, 2015

Hungary ready to serve the world Already a booming business, the phenomenon of SSCs is expected to provide young Hungarians with employment – and to fuel the local office market – even further in the near future. Firms that locate back−office functions here benefit from the local pool of affordable talent.

LEVENTE HÖRÖMPÖLI-TÓTH

Shared service centers in Hungary allow firms to take advantage of the country’s talent pool and cost−effective workforce by grouping business services here.

Based on interviews with experts, further increases in the economic significance of this sector can be taken for granted.

“In the last few years in the CEE region, the industry of modern business services has been registering a 15−20% increase of employment each year. In the upcoming years, we expect a dynamic development of the shared service center (SSC) and business process outsourcing (BPO) sector, which is to become one of the main branches of the economies in the CEE region,” reads a recent study by Hays, a leading recruitment firm.

SSCs are set up in order to centralize certain corporate functions of multinational firms in one single service unit; this then serves other in−house departments and external customers with specialized services. The shared services model is growing around the globe, and according to an estimate by professional services firm EY, related revenues were projected to soar worldwide by nearly 12% between 2013 and 2015. For many reasons, Hungary is a destination for SSCs and BPO offices, and the industry is exceptionally strong here.

“The significance of SSCs in Hungary is continuously growing. Currently, there are around 96 of them employing some 36,000. In 2014 alone, eight new such centers were opened,” the Hungarian Investment and Promotion Agency (HIPA) tells the Budapest Business Journal in a statement.

HIPA is actively involved in encouraging this further: It not only initiates regular consultations with the main players in the industry, it also promotes Hungary as an attractive location for investment at its own events and through business diplomacy.

With more than 20 years of sectoral experience, Hungary now belongs to the so−called “mature” locations where SSCs are charged with ever more complex duties. Projects typically brought here from Western Europe or the USA primarily

GEʼs Global Operations Center in Budapest. target Budapest, but larger Hungarian university towns in the countryside have been gaining acceptance as well.

British Telecom, which operates one of the largest SSCs in Hungary, has twin offices, one in Budapest and the other in Debrecen. Only last year it expanded its total office space in the two centers by more than 4,000 sqm, while staff went up by 400 to 1,300. The company has been present in Hungary since 1999, and launched its SSC in 2007, so by that time it knew what to expect.

“We had a very good experience with recruiting talented people and building up a successful back office and support teams in the previous years at that time,” Andor Faragó, general manager at BT’s EMEA Regional Operations Center, explains to the BBJ. When selecting the location, the following aspects were also taken into consideration: Labor arbitrage, Hungary being an EU country, legal security, appropriate infrastructure, availability of offices, and the excellent living and working conditions.

Beyond the above considerations, cost−effectiveness normally counts as an additional incentive. As shown in a study

by Corvinus University of Budapest, whilst average annual costs of a workstation in Hungary amount to around €3,000, the figure in Western Europe is considerably more than €10,000.

A personnel matter SSCs are particularly attractive to members of Generation Y, who can start an international career without leaving the country. However, well−educated employees with great language skills are of increasingly short supply. A BDO Hungary survey reports that the bulk of SSCs struggle with critical labor shortages and high levels of fluctuation; many younger colleagues will simply switch workplaces if they feel their work is monotonous or they don’t see good career prospects.

“The significance of SSCs in Hungary is continuously growing.

Currently, there are around 96 of them employing some 36,000.

In 2014 alone, eight new such centers were opened.”

General Electric is currently on the hunt for talent in order to fill several hundred vacancies in its Global Operations Center located in the Hungarian capital. General manager Bjorn Bergabo is confident he will be able to find and keep the right people. “Within global operations, employees are part of a broad and globally recognized world−class team. It opens avenues within GE to tailor a career path to match employee aspirations, develop necessary competencies, promote best practice sharing and provide opportunities to grow.”

Nokia Networks, which selected Budapest as its Finance Shared Services (FSS) location in 2004, aims to achieve long−term commitment by relying on strong company values. “Retaining employees needs a multilevel strategy: Attract, engage and develop the best talents. In addition to their competitive benefits package, Nokia Networks employees working in the Hungarian FSS can take cross−functional opportunities and job rotation as well,” a Nokia statement says.

BT’s Faragó emphasizes the importance of maintaining a positive company reputation. “Hungary is a very small market and good news and bad news are spread quickly.” Recruitment takes place via several channels, relying on employee−referrals, PR campaigns, CSR programs and job fairs.

But keeping talent must come from inside. “By keeping our people engaged

with various employee programs, internal career opportunities, training and development programs, BT is said to be a ‘great place’ to work at,” Faragó notes.

“The result is also visible in the No. 1 place achieved in the Best Employer 2014 survey’s SSC category, or the Family− friendly Workplace Award granted in 2012 and 2014.”

Becoming multifunctional The operation of SSCs is far from static, though. Part of the evolutionary process is becoming evermore multifunctional, where the willingness to innovate is crucial. “GE has been in Hungary for more than 25 years. Our investment in establishing the Global Operations Center in Budapest is another step reflecting our continued commitment to service innovation and growth in the region,” Bergabo says. GE plans to double it 1,000−strong staff as the scope of operation becomes multifunctional.

BT, in turn, already carries out very complex tasks in four large service “towers”, namely FSS, customer service, business administration and support services. “We have 12 different functions providing specific services,” Faragó says.

Innovation efforts mainly concern process improvement. “BT has a special continuous development program based on Lean and Six Sigma principles that are applied in the Hungarian shared services as well, and it delivers outstanding results such as system automations, developed skills, process enhancements and cost reductions. The focus of these improvements is always the customer and how BT can deliver a better service,” the general manager adds.

The odds are exceptionally good that Hungary will see a lot more similar multifunctional business hubs emerging within its borders. And both the economy and the labor market will cheer up as a result.

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Budapest Business Journal | June 19 – July 02, 2015

EXPERT OPINION

Andor Faragó General Manager EMEA Regional Operations Center at BT Hungary Q: How does the SSC sector contributes to the Hungarian economy?

A: Shared services is definitely one of the booming sectors in Hungary, which attracts significant foreign investment, and generates the most jobs in the country. Therefore, it is also one of the strategic sectors of the Hungarian economy. Finding a job in the sector is an excellent opportunity for Hungarian graduates and junior professionals who speak foreign languages – i.e.

English plus another language. They can gain experience about working in a multinational and multicultural environment, with various hard skill and soft skill trainings offered by the companies they can continuously learn and develop. Talents can climb up the career ladder relatively fast in an SSC environment – especially those who gain experience in multiple roles and activity areas. The knowledge Hungarian young professionals can gain in an SSC, makes them attractive and valuable in the labour market not just in Hungary but probably at a global scale.

Q: Why Hungary is an attractive location for shared services?

A: There are a lot of advantages Hungary can offer to shared service centres.

An obvious benefit, but still probably the most important one, is its EU membership. Harmonised European legal and regulatory environment, the stable economy and the European culture are crucial decision making criteria for investors. I could also mention the accessible tax benefits for investments or government incentives for creating jobs, for training, etc. However the key decision point, and from my point of view the most important factor is people: the quality of education, the availability of

language skills, the mentality and attitude to work, etc. This inevitably puts Hungary in the top three shared service locations in the EU. Q: How do you see the development of the SSC sector in Hungary? What are the success criteria / areas for improvement for the future?

A: The trend is very clear: the scope as well as the complexity of the activities increasing, and the focus is moving from cost benefits towards sustainable added value – e.g. endto-end process ownership. In the past ten years the Hungarian SSC sector has gone through a tangible and very well visible development. Today the simple, transactional, monotonous work represents an insignificant proportion of the activities in scope. There are other geographies where such tasks can be carried out more cost effectively. SSCs in Hungary rather recruit graduated, multi-lingual, highly qualified, ambitious and creative people who are obviously capable for not just doing the job but moving activities and processes up on the value chain – e.g. identify and solve problems, take initiatives for improvement, simplify things, etc. This is what makes shared services a long-term sustainable business in Hungary.

Considering the mid-term future SSCs will continue growing, creating jobs, attracting investments to the country and remain one of the leading sectors of the Hungarian economy. Longer term, the future of the sector is very much dependent on whether Hungary can stay competitive in terms of education in Europe. High-quality education is indispensable for meeting the demands of the modern labour market. Lots of changes have been going through in the education system of Hungary in the past years, however it still does not look promising in terms of improving foreign language skills. Extending multi-lingual capabilities and increase the level of language proficiency would be essential to maintain the competitive advantage of the country – in particular in the SSC sector.

Global companies like BT invest a lot in further training and continuous development of Hungarian young professionals in every conceivable field (computer skills, communication skills, presentation skills, project management, time management, leadership, etc.) however fluent language skills take years to pick up – therefore, evidently, they have to be supplied by the educational system. A setback in this area would hit the competitiveness of the country as well as the attractiveness of Hungary for foreign investments quite heavily. I am absolutely convinced that the Hungarian government is aware of that and we can expect positive and forward-looking solutions in this area in the near future.

Q: Who are the main competitors of Hungary? Can Hungary be competitive with India?

A: The countries in Central Eastern Europe obviously has a very similar root and conditions in terms of their history, social and economic development, living standards, education, EU membership, etc. - and these immediately determine that there is competition for foreign investments between the countries of the region. In the shared services industry I can see Hungary and Poland being a bit ahead of other countries in CEE, but also the Czech Republic and Romania are catching up quite fast.

Globally the number one location for shared service centres is India.

The leading position is mainly driven by cost advantages. Initially India used to be considered predominantly for back-office type, non-customerfacing activities. Although the CEE region remains the preferred location of investors for multi-lingual capabilities and more complex activities within Europe, we also need to realise that the original presumption that India can only carry out simpler and very transactional activities, is already a thing of the past. Thanks to the investments by the government in this sector India has been developing significantly and very fast. It has state-of-the-art infrastructure and

also the skillset of people are very much comparable to Europe – while the cost of employment remains significantly below the Central European average. The European time zone and the availability of European language skills are probably the only tangible advantages Hungary can still offer compared to India, Malaysia or the Philippines.

Q:Why are SSCs attractive for employees? What does BT do to be competitive in the market?

A: There are lot of challenges for employers in this sector, but one of them is the strong focus on retention.

SSCs usually spend a lot of money for finding and recruiting the right people in the market. Even after the initial training for the job companies keep investing in their training and development.

For this obvious reason employees become a more and more valuable assets for companies. SSC companies therefore make a lot of efforts to attract employees and keep them long-term.

Let me take BT as an example: We have a young and dynamic community - the average age is below 30 – where colleagues become friends and often socialise together even outside working hours. We offer attractive wages and a wide range of nonfinancial benefits to our employees.

There are a wide range of employee and family-friendly initiatives, talent development programmes, team events, and not least excellent career opportunities. There are 17 different activities in our service portfolio, which provides exceptional opportunities for our employees to do career moves or change roles both vertically and horizontally within the company. All these said naturally make BT a very attractive place to work. At both locations, Budapest and Debrecen, we are considered to be one of the best employers. We are continuously looking for talents but it is not easy to become a BT employee. Our selection process is quite challenging, but those who succeed enjoy working for BT and usually stay with us long term.

ADVERTISEMENT

In 2014 BT was ranked No.1 by AON Hewitt’s Best Employer survey in the category of shared services in Hungary.

We search for talented graduates, junior professionals and experienced technical experts to join our company.

Talent, enthusiasm, ambition - join us and build your career in BT! BT is one of the world’s leading communications services providers operating in more than 170 countries. Our European Operations Centre employing more than 1400 people in Budapest and Debrecen is one of the biggest and most complex shared service centres in Hungary.

You can find out more information about our current positions at: www.bt.com/career www.facebook.com/bthungary

NOTE: ALL ARTICLES MARKED EXPERT OPINIONS ARE PAID PROMOTIONAL CONTENT FOR WHICH THE BUDAPEST BUSINESS JOURNAL DOES NOT TAKE RESPONSIBILITY

Shared service centers offer great possibilities for Hungary

14

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Budapest Business Journal | June 19 – July 02, 2015

SSCs must fight hard for talent UNICEF signs

deal to open SSC in capital

Shared service centers need to use new recruitment tools and to look beyond Hungary’s borders if they want to find the qualified candidates they require in large enough numbers.

LEVENTE HÖRÖMPÖLI-TÓTH

Ottó Vég, MD of Adecco.

Job title: finance analyst. Employer: a world−leading agribusiness company, recruiting across all departments for its brand new European Finance Center in Budapest. Requirements: a relevant degree and understanding of financial processes within a shared service environment. Offered is a rewarding compensation package.

Job hunters in Hungary tend to come across vacancies of that sort evermore frequently. In the battle for investment, Budapest has apparently developed an edge over rival cities in the region.

A survey by Site Selection Magazine in 2013 found that Warsaw, Prague, Bucharest and Sofia all fared worse based on six criteria. Still, it appears that the quality of local labor is the lead factor that makes the Hungarian capital so attractive to firms willing to bring their global hub of operations to the region.

But as Hungary−based shared service centers shift towards more complex functions beyond mere transactional activities, demand for skilled workers is becoming harder than ever to meet.

“We, in the American Chamber of Commerce in Hungary believe that a challenge today is to keep providing a well−qualified, competitive workforce for this dynamically growing sector,” Bea Előd, AmCham board member and head of the Citi Service Center Budapest, tells the Budapest Business Journal.

“Therefore, AmCham takes an active part in further developing our talent, so that they can be ready for the new demand for an agile workforce.”

SSCs face the particular challenge of finding quality candidates in large numbers as every third center will hire more than 500 people, according to a Randstad study. Top areas hungry for talent include customer service, IT and HR support, finance, pay roll, and logistics. But only those with proper language skills stand a chance of being selected.

“French, Spanish, Portuguese, and Dutch are the most sought languages after German and/or English, which are deemed as the minimum by now at such employers,” Tamás Sellyey, managing director of Workforce, an HR firm says.

Speakers of truly exotic tongues are the scarcest, of course, but even knowledge of Nordic languages such as Norwegian, Swedish, or Danish can entail a major salary hike.

Top areas hungry for talent include customer service, IT and HR support, finance, pay roll, and logistics. But only those with proper language skills stand a chance of being selected.

Upgrade your recruitment toolkit At recruitment company Hays, another trend noted is that the Hungarian SSC market is being considered as a global service center location, and no longer limited to the Europe time zone. “It is very difficult to fill 24/7 operating IT service desk positions due to the shifts, where the pool of candidates is more limited because of the working hours,” says Hays.

Competition for talent within the market is also growing. Applicants tend to be much more knowledgeable about job seeking than before since they are familiar with the sector’s characteristics.

“Job−hopping” is another phenomenon, where an employee changes companies and not positions for a higher salary.

Sellyey says it is essential to embrace a new approach in recruitment methods.

It is time to replace conventional means by head hunting and direct search to reach out to motivated candidates. HR executives, in turn, tend to maintain a close relationship with language schools teaching the more unusual languages or embassies in order to meet swiftly growing demand.

SSCs sometimes make their own life harder by not being clear enough when describing vacancies, a problem confirmed by Adecco’s managing director, Ottó Vég.

“Some of them use their own company− specific terms and abbreviations in adverts.

Consequently, applicants don’t understand what duties are to be performed exactly,” Vég notes. “The other extreme is having way too general descriptions where the given firm is looking for colleagues for several similar posts and they want to decide during the selection procedure in what area a job will be offered to successful candidates. This makes it tough to judge

Sándor Baja, MD of Randstad. whether the positions in question are the right challenge for those currently holding a job.”

Surging demand for quality human resources requires broadening the search perimeter where cross−border recruitment seems inevitable. “There are many Western European young professionals who would love to start in a Hungary−based BSC (business service center) or SSC after graduation,” Sellyey says. “Multinational companies should encourage candidates from outside the EU as well by granting visa or work permit sponsorships or relocation allowances. Native Spanish, Portuguese or French speakers could be attracted in large numbers from South America or the French overseas departments.”

Pundits also expect the Hungarian government to take measures to further ease SSC activity. Funds for job creation and retaining purposes should be extended to the sector, and the country should be engaged in a long−term strategy of strengthening its domestic language education system.

Special needs require special attention The solid market presence of SSCs has caused HR firms to pay special attention to their needs; the biggest players have even assigned separate departments for this purpose.

Sándor Baja, managing director of Randstad, a market leader among recruitment companies specialized in the sector, notes that fluctuations must be handled on a permanent basis, whereas one−time large−scale recruitments represent another sector− specific challenge due to migration of new teams.

Several SSCs have set up in−house recruitment departments with the aim of pushing down the role of agencies.

However, very few can fill positions effectively at short notice.

“A vast array of creative recruitment techniques needs to be used. The mobilization of passive candidates and finding graduates are of key importance, which requires alternative tools and substantial resources. Beside standard recruitment tasks, a quality agency partner can help improve the reputation in Hungary of particular companies through professional market analyses and by holding presentations and providing consultations,” Baja concludes.

The Hungarian government and UNICEF signed an agreement to establish UNICEF’s Global Shared Services Center in Budapest, making it the hub of financial and human resource operations, according to a press release sent out on June 15.

The agreement was signed in New York

by István Mikola, Hungarian Minister of State for Security Policy Cooperation and International Cooperation, and UNICEF Executive Director Anthony Lake. The agreement is now awaiting ratification by the Hungarian National Assembly.

UNICEF, the United Nations Children’s Fund, would be following the UNHCR (the UN Refugee Agency) in opening an SSC here. The UN Food & Agriculture agency is also considering placing a center in Budapest.

“Hungary is pleased that UNICEF selected Budapest to host its Global Shared Services Center. This decision responds to the agenda of the Hungarian government to consolidate the country as a competitive, outstanding international service hub in the center of Europe. I trust and wish that UNICEF will make good use of operating the Global Shared Services Center in the Hungarian capital to the primary benefit of the children of the world,” said Mikola.

–Nick Pongratz

IT Services Hungary to add 400 jobs Service center operator IT Services Hungary, a member of T−Systems and owned by Deutsche Telekom, expects to make at least 400 new hires in Hungary this year, Minister of Foreign Affairs and Trade Péter Szijjártó said at a press conference on June 8.

IT Services Hungary currently employs more than 4,000 people in four cities in Hungary, the foreign minister said, adding that most are university graduates with foreign language skills.

The company provides IT services outsourcing to a number of clients around the globe. It was named the national champion of the European Business Awards “Employer of the Year” category in Hungary 2014/2015.

Szijjártó noted at the press conference that the Hungarian government is supporting the staff expansion with HUF 2.5 bln from the central budget and European Union funding.

IT Services Hungary cooperates with 12 universities in Hungary, Hungarian news agency MTI said. The company was presented with this year’s “Investor of the Year” award by the Ministry of Foreign Affairs and Trade and the Hungarian Investment Promotion Agency (HIPA), it added.

–bbj.hu

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Budapest Business Journal | June 19 – July 02, 2015

SSC salaries in Hungary competitively low AVERAGE MONTHLY GROSS WAGES OF SSC WORKERS IN EUR* Hungary (Recommended range)

Poland (Recommended optimum)

Prague** (Typical)

ACCOUNTING AND FINANCE AP/AR Clerk (0-2yrs)

866-1,123

AP/AR Junior Associate (0–1yr)

724

AP/AR (0 – 1yr)

1,101

AP/AR Team Leader

1,444-1,925

Team Leader (5–10 FTEs)

1,930

AP/AR Team Leader

1,835

AP/AR Manager

2,567-3,530

Process Manager (min. 20 FTEs)

2,896

AP/AR Manager

3,302

GL Accountant

899-1,284

GL Junior Accountant (0–1yr)

965

GL /Reporting (0-1yr)

1,101

GL Team Leader

1,925-2,567

GL Team Leader (5–10 FTEs)

2,172

GL Team Leader

1,945

GL Manager

2,888-4,172

GL Process Mgr. (up to 50 FTEs)

3,619

GL Manager

4,036

IT HELP DESK

IT/TECHNICAL SUPPORT

IT (1ST LEVEL SUPPORT)

1st level IT help desk (0-2yrs)

963-1,155

1st Line Support (0 - 1 yr)

845

Up to 1yr

1,064

Team Leader

1,765-2,407

Team Leader (5 – 10 FTEs)

2,051

Team Leader

1,688

Service Delivery Manager

2,567-3,851

Process Manager (min. 20 FTEs)

3,137

Manager

3,119

Representative (0-2yrs)

899-1,155

Junior specialist (0-1yr)

845

Up to 1yr

991

Team Leader

1,604-2,086

Team Leader (5 – 10 FTEs)

1,930

Team Leader

1,578

Operations Manager

2,567-3,209

Process Manager (min. 20 FTEs)

3,619

Manager

3,119

CUSTOMER SERVICE

Source: THE 2015 HAYS SALARY GUIDE, BUSINESS SERVICE CENTERS * Data was supplied in local currencies and converted for comparision, based on FX rates after close of European markets on June 16. ** Salaries are slightly lower in Brno and Ostrava in Czech Republic.

Judging by the typical salaries paid for workers in shared service centers, Hungary appears to be competitive with its neighbors.

The data shown above was compiled by the CEE offices of Hays, a leading recruiting firm specializing in hiring for SSCs, based on hundreds of recruitment projects conducted by the company’s representatives in three of the five Central and Eastern European countries. These countries, Hungary, Poland and Czech Republic, are busy centers for SSCs. The table above compares monthly gross pay for similar positions.

For comparison’s sake, the local salaries have been converted into euros, and the lowest salaries are marked in red. The data collected in the three countries varies slightly. For example in Hungary, average salaries are given as a range, and the salary determined for each worker depends on their experience. Despite differences, the data allows a rough comparison of various typical positions, and would seem to indicate that, at least at the lower end of the range, Hungarian pay is often the lowest, and is never much more than that of its neighbors.

Portal serves service sector SSC Heroes Hungary is a neutral source of information for both workers and employers.

or sector−specific HR issues. Competitions like YounGOffice – where employees at three multinational companies are engaged in a virtual game to solve situational and linguistic exercises – make the community even stronger.

More events are planned for fellow employees, more services for companies “We have around 5,000 unique visitors and an ever−stronger stream of positive a month and close to 3,000 users in our communication focusing on the strengths database. I can confidently say that if of the industry. SSC Heroes is also there is any event, student competition working with a reputable educational or educational program developed for provider on a special educational the shared services industry then we are program. “Our aim is to become a single involved to some extent,” Péter Balázsik point of information for the entire sector,” says of SSC Heroes Hungary, which he says Balázsik. “It is a very important co−founded. message to communicate that this Its establishment was long overdue; sector can provide these people with companies running their global operation meaningful work, offer leadership roles hubs here were reluctant to do anything at a relatively young age, and for above− themselves as they compete not only average compensation. The fact that against each other, but also for the the exact same young people have the same human resources on the market. most willingness to emigrate [abroad “The solution had to come from outside,” and thus out of the local workforce Balázsik points out. altogether] makes this message even Users can now gain invaluable more relevant.”

The opening page of SSC Heroes Hungary. information about the latest job openings –Levente Hörömpöli−Tóth

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Budapest Business Journal | June 19 – July 02, 2015

Office development essential for SSCs If the market for shared service centers is going to grow, then maintaining a low−cost and capable workforce alone will not be enough.

Ensuring growth in the sector also requires a decent level of class ‘A’ office vacancies.

GARY MORRELL

Shared services centers form a significant proportion of Budapest office take−up as multinational companies and organizations seek to off−shore their operational elements to countries that are able to provide quality accommodation, a skilled labor force and good business infrastructure at a reasonable price.

Indeed, Hungarian promotion agencies have been selling the country in precisely this way – as an advanced but cost− effective business environment – as the country competes with other CEE states for incoming business. However, the supply of class “A” premises needed in Budapest to meet this demand is low as pipeline office complexes are close to 100% preleased before delivery. Furthermore, a speculative office development market has still not taken off outside of the capital.

According to PwC research based on interviews with companies involved with SSCs, Hungary is continuing to attract shared service centers, and this could not have happened without the “strong, reliable and consistently high performance levels of SSCs”. However, Hungary has to remain competitive in the region with regard to a skilled workforce, IT, telecommunication, logistics and transport infrastructure. Aditionally, from a real estate perspective there has to be a consistent supply of class “A” office buildings both for companies looking to set up offices and those extending existing centers.

By the end of 2014, more than 60 SSCs were operated by international corporations in Budapest, representing 300,000 sqm of space, according to Cushman & Wakefield. Last year 27% of Budapest office take−up was from the SSC sector, compared to 24% in 2013 and 36% in 2012. Total leasing activity from SSCs was more than 77,000 sqm in 2014, consisting of new leases, expansions and renewals.

More SSC offices expected “As for 2015, we expect further action on the Hungarian SSC market. More customers have already taken steps in order to expand their activities, which will boost the office market, while new entrants have already indicated their intention to organize their service offices – such as the Food & Agriculture Agency of the UN,” commented Cushman & Wakefield.

Part of Váci Greens has been booked by GE Healthcare.

One of the biggest recent deals was the 3,200 sqm letting to UAE airline Emirates for the establishment of a SSC in the 16,000 sqm Krisztina Palace, owned by the German investor Union Investment and located in central Buda. The regional call center employs more than 300 staff and its establishment was supported by the Hungarian government.

GE Healthcare, meanwhile, has agreed to a 6,500 sqm pre−lease in Building C at Váci Greens (by Belgium’s Atenor Group) to establish a regional sales and service center for CEE and a software hub, in addition to a laboratory area on the ground floor. The complex has BREEAM accreditation, easy access to green areas and large efficient floorplates with advanced technologies according to Zoltán Borbély, Project Director at Atenor. The latest 18,000 sqm phase has just been delivered.

“We were looking for a new location; it needed to be the highest quality and well located in order to retain and attract the very best talents as we build a global software center,” said Lajos Reich, chief technology officer at GE Healthcare. “Our aim is to build an inspiring work environment. From these perspectives, Váci Greens offered us an excellent fit out.”

Modern work environment

Krisztina Palace in District XI.

“More customers have already taken steps in order to expand their activities, which will boost the office market.”

Gábor Borbély, senior investment consultant at CBRE sees that SSCs and Business Process Outsourcing (BPO) activities have accounted for quite a remarkable share of Budapest office take−up as, in the course of the last three years, take−up has reached 16% of the total.

An SSC is broadly defined as the entity in an organization responsible for the execution and the handling of specific operational tasks such as accounting, human resources, IT, legal, compliance, purchasing and security. Essentially it is the spin−off of corporate services in order to separate operational tasks from the corporate headquarters. This process is cost sensitive in terms of head count, labor costs and local selection criteria. In this way, CEE offers a substantial discount on core business centers.

A more precise definition of SSCs is tricky as what they do is often confused with BPOs, according to Rita Tuza, head of research at JLL Hungary. She defines BPO activities as “a form of business services provided to companies located in different markets to the service provider who operates the service centers. An SSC can be operated by a company itself, but often ‘shored’

(on−, near− or off−) to a lower cost location.” She adds: “Both forms of are very beneficial for Hungary, and they represent an important occupier group in the Budapest office market.”

With regard to the specifications demanded by companies setting up SSCs and BPO centers, CBRE’s Borbély comments that companies simply do not move to outdated properties and they have a preference for the best locations.

Further, 61% of SSC/BPO take−up over the last three years was concluded in class “A” buildings, while this proportion was only 38% for non−SSC/BPO companies.

He argues that SSC/BPO offices tend to move to multi−tenanted buildings rather than establishing headquarters.

“Companies look for the best buildings available as landmark and visibility both matter for them. Central locations are preferred and easy public transport [access] is key, and more important than parking ratio. Typically, required buildings have 15−20,000 sqm of GLA with 2−3,000 sqm in an adjacent area. The average SSC/ BPO deal size is 2−3,000 sqm.”

Price-sensitive market Ferenc Furulyás, managing director of JLL Hungary sees the BPO market as very price sensitive. “Location is very important with access to public transport, air quality for example is crucial due to a relatively high number of employees per sqm, and proximity to an education center with the need for an educated labor force,” he said.

Elsewhere, the Avis Budget Group has already established a 7,200 sqm SSC on three levels for around 600 employees at the 17,800 sqm Green House office center in Váci út by Skanska Property Hungary. The SSC is responsible for finance and accounting, debt management, IT, database management, fleet administration and customer services. According to Avis the site was chosen because of a combination of its location adjacent to a metro station and other public transport links and what it defines as a “modern and healthy work environment”.

All of these projects conform to the requirements for BPO offices with regard to quality and location, as does the first 7,200 sqm phase of the 26,200 sqm Nordic Light development by Skanska (adjacent to a metro station on Váci út), due to be completed in the first quarter of 2016. Andrea Csibi, leasing negotiator at Skanska Property Hungary, commented that she is already receiving a number of enquiries from companies looking to establish SSCs. With regard to quality office supply to meet the needs of SSC/BPO offices, JLL describe the volume of new Budapest supply as “very limited”, with less than 30,000 sqm of space predicted to be delivered this year.

That said, the 2016 pipeline is forecast to reach the highest volume since 2010 at 90,000 sqm.

A further brake on increased SSC market activity is that office developers are reluctant to start projects outside of the capital in secondary cities with large universities, such as Debrecen, Szeged and Pécs, whereas such secondary cities in both Poland and Czech Republic are attracting companies that are looking to establish SSCs.

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Budapest Business Journal | June 19 – July 02, 2015

Shared service center operating companies

SALES

CLIENT MANAGEMENT

OTHER

EXTERNAL

INTERNAL

FLEXIBLE WORK HOURS

PART-TIME WORK

WORK FROM HOME

PLANNED NEW WORK FORCE HIRED IN H2, 2015

YEAR ESTABLISHED

BOTH

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PROCUREMENT

2

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FINANCE

1

NO. OF EMPLOYEES WORKING FOR SSCS ON MAY 1, 2015

COMPANY WEBSITE

AVAILABLE WORK CONDITION CHOICES

TOTAL NET REVENUE (HUF MLN) IN 2014

RANK

Ranked by total net revenue in 2014

185,069

406

–

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Âť

Âť

Âť

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–

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4,003

–

–

–

–

–

–

–

–

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300

2006

– T-Systems International (100)

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1095 Budapest, Lechner Ă–dĂśn fasor 8.

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www-05.ibm.com/employment/ hu/idc/index.html

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4

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IBM HUNGARY INTERNATIONAL SHARED SERVICE CENTRE KFT.

31,205

1,074

–

–

–

–

–

–

–

110

2006

27,860

2,600

–

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–

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6

NOKIA SOLUTIONS AND NETWORKS KFT.

21,441

250

–

–

–

–

–

–

–

–

–

Âť

2007

– Nokia Solutions and Networks B.V. (100)

18,407

640

–

–

Âť

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15,341

1,100

–

–

–

100

2009

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14,658

1,367

–

–

–

200

2007

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2011

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Szilård Ocskay Judit Nyeste –

1138 Budapest, VĂĄci Ăşt 186.

(1) 465-5100 (1) 465-5101 nexon@nexon.hu

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1117 Budapest, Budafoki út 91–93.

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11

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4,480

1,400

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–

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13

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14

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3,250

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7KLV OLVW ZDV FRPSLOHG IURP UHVSRQVHV WR TXHVWLRQQDLUHV UHFHLYHG E\ -XQH DQG SXEOLFO\ DYDLODEOH GDWD 7R WKH EHVW RI WKH %XGDSHVW %XVLQHVV -RXUQDO¡V NQRZOHGJH WKH LQIRUPDWLRQ LV DFFXUDWH DV RI SUHVV WLPH :KLOH HYHU\ HIIRUW LV PDGH WR HQVXUH DFFXUDF\ DQG WKRURXJKQHVV RPLVVLRQV DQG W\SRJUDSKLFDO HUURUV PD\ RFFXU $GGLWLRQV RU FRUUHFWLRQV WR WKH OLVW VKRXOG EH VHQW RQ OHWWHUKHDG WR WKH UHVHDUFK GHSDUWPHQW %XGDSHVW %XVLQHVV -RXUQDO 1075 Budapest, Madåch Imre út 13–14., or faxed to (1) 398-0345. The research department can be contacted at research@bbj.hu

BBJ

4 Socialite Swinging on Budapestʼs streets Urban golf, a new twist designed to expand the popularity of an old sport, is bringing an eccentric crew, nine−irons in tow, out to public spaces in the capital.

CHRISTIAN KESZTHELYI

The author, a member of Fly Away UGC, in mid shot.

Forget the idea that playing golf requires membership at an expensive club with eye−catching greens and strict etiquette, along with a costly investment in equipment. A new trend called urban golf is changing the way many people think of the sport, and is catching on in Budapest with the creation of several urban golf clubs (UGCs) in the capital.

Passersby walking through Budapest’s City Park (Városliget) may spot some slightly eccentrically−dressed people with golf clubs in their hands, setting up shots in unlikely places or shrieking with joy after hitting a trash bin or similar target with their soft and safe “almostgolf” balls.

These people represent the currently small but growing scene of urban golfers in Hungary.

In fact, the idea began in Hungary before many local participants were even aware the fad existed. “We thought that it would be fun if we started hitting some tennis balls with some second− hand golf clubs and after a few events we realized that this was an existing sport, known as urban golf, and played by many foreigners,” said Balázs Ruszty, also known as Albert Swinger, the founder of the first Budapest−based Hungarian urban golf club, Heavy Balls UGC. The club has opened the world of golf to people who might never have considered

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MasterCard Balaton Sound program is ready The program of MasterCard Balaton Sound, the premium electronic music festival, is now ready. The line-up hosts the biggest international DJs and Lake Balaton awaits visitors with a 2 km beach and numerous venues to keep the party going. The 4+1 day beach party is held between 8-12 July in Zamárdi, Hungary.

Summer is coming and MasterCard Balaton Sound tickets are selling quickly. By now it’s not a surprise, considering the fact that this is one of the few electronic music festivals with a real lakeside connection, as about 2 km of beach awaits fans of music and summer right at the festival area. This year the enlarged festival area will have exclusive decorations and visuals as well as more than 20 program venues to make sure everyone finds the right party. In 2015, the 9th MasterCard Balaton Sound will entertain the audience for 5 days.

July 8 - Special Day 0 program The special additional day called “Day 0”, July 8, will start with one of the most awaited DJs, Tiesto, who has already played at

Sound exactly 4 years ago. Oliver Heldens will also bring his sets to the main stage, that has the capacity of more than 20,000 people. Situated both on water and land, the very popular Terrace will open with Jan Blomqvist and Guy Gerber. Fans of Dyro and AronChupa should also be in Zamárdi already on Wednesday, as the Jager Arena will also have its kick off. Day tickets are still available in a limited number, but the passes are better value as they include all 5 days.

Line-up The regular festival days also have a very strong line-up. The gigantic tent of the Telekom Arena will host well-known DJs for 4 days as the Grammy Award winner Zedd, Kaskade, Ummet Özcan, Vinai, Quintino, Don Diablo and Firebeatz. Techno fans can find their favorites

as Loco Dice, Pan Pot and Chris Liebing in the Noize, Bloody Beetroots, Charli XCX, tent. When it comes to the MasterCard Main A-trak and Odesza.

Stage, we can see the biggest stars, who are among the top 10 DJs of the world as Tiesto, Special program venues of 2015 Hardwell, Dimitri Vegas & Like Mike and Nicky This year’s focus is Lake Balaton and the Romero. The main stage will also be the home beach, so MasterCard Balaton Sound will of Faithless and Axwell Λ Ingrosso, Afrojack, have a record number of beach terraces, Showtek, DVBBS, Laidback Luke and R3HAB piers, lounges, cocktail bars and party as well. Besides the electronic music scene, venues. One of the most awaited venues organizers would also like to please the fans this year will be an exclusive yacht called of hip hop and r’n’b. This year Jason Derulo “Telekom Rave”. The program will feature and Ludacris will have a frenetic show at the Debut, HiFly, RAW, NVC, LavaLava as well premium festival. as Hector Couto, Cuartero and with a special Looking through the main venues, the b2b set Gorje Hewek & Izhevski as well as program of the Jager Arena seems like Big John Whitfield. Every morning from 10 the most eclectic. Roni Size Reprazent, AM refreshing drinks and shady couches will Netsky, Noisia, and Leftfield will bring their await the party people on board! music as well as Rae Sremmurd, Joey More information and tickets: Badass, Pusha T, Flosstradamus, Boys www.balatonsound.com

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4 Socialite

Budapest Business Journal | June 19 – July 02, 2015

19

At left, Heavy Balls UGC in City Park. Above is Gintner Domonkos of Heavy Balls.

the game. Starting is remarkably easy, as Swinger explains: “Grab a golf club – preferably 7−9 irons, any kind of wedge or a putter – grab an ‘almostgolf’ ball and hit the streets,” “The ‘hole’ could be anything; for example a trash bin, a pillar or a parked bicycle,” he said. In general, the target is rarely an actual hole.

“The winner is the one who hits the target with the least amount of strokes,” Swinger added.

Tested internationally The Hungarian Urban Golf Team (HUGT) first challenged its abilities against the national Czech team in Czech Republic, in a friendly tournament on March 28, but did not come away the winners. On May 16, HUGT participated in the European Urban Golf Cup in London.

“We finished tenth, out of ten teams, but Team Luxemburg beat us only by four points or strokes, which is not a huge gap.

Given that every other country started

the sport more than six years ago, I think it is a great achievement that we also participated in the cup,” Swinger said.

“The cup itself is not official, because there is no such thing as an international urban golf association, just some guys who started organizing a bigger event for every country around Europe.”

As the godfather of Hungarian urban golf, Heavy Balls UGC happily welcomes beginners who would like to learn about the sport and are planning to start playing. The team encourages newcomers to “make their own teams sooner or later, because our goal is to make a flourishing urban golf life in Hungary, and to reach this vision we

need a lot of different groups, who play and organize themselves independently,” Swinger added.

Though rather optimistic, this may be a viable goal. Heavy Balls UGC was founded less than a year ago, on August 22, and already two other teams have been created since: The Drunken Golf Club and the more−recently formed Fly Away UGC. If you are keen on seeing them live, the members of Heavy Balls appear once or twice a week for training sessions in Városliget, or around downtown Budapest, and they encourage interest.

As the motto of the team goes: “Don’t be afraid, golf is for everyone!”

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VeszprémFest fills generation gap The Budapest Business Journal caught up with festival director Zoltán Mészáros to discover that there’s more to Hungarian festivals that battling throngs of young folks amid swirls of dust and sound.

While most festivals cater to teens and 20-somethings, the Veszprém music festival, which is on this year from July 15-18, targets a more mature crowd with its eclectic mix of music from rock to jazz, to underground and electronic beats.

Now in its 12th year, the VeszprémFest still calls the city’s castle district home but over the years it has augmented its selection of outdoor venues. “While the main stage at Szentháromság square can accommodate approximately 2,000 concertgoers, we’ve added four additional stages over the years and expanded into more popular musical “The motto of the event is ‘30 vintners, 30 genres,” says Zoltán Mészáros. concerts’ with a highlight of wines from the Balaton region,” he says, adding that this The festival director is particularly proud of mini festival will feature only Hungarian artists the festival within the festival dubbed Rosé many of which are young up-and-comers on Riesling and Jazz days, which is free to enter. the jazz scene.

For those who like to dabble in Dee Bridgewater with New Orleans Jazz experimental art and music, the festival Orchestra (July 17). Meanwhile soul queen will hold a series of art events, film Emeli Sandé will close the festival with a screenings and live shows at the Palace show at the Veszprém Arena (July 18). venue bringing together former members of notorious underground art band The FestGarden, which can accommodate Bizottság, known for their bizarre and up to 500 guests will host a series of subversively anti-communist statements jazz concerts beginning with Mike Stern during the 1980’s. “With this offering, the and Didier Lockwood (July 16), Jack festival’s palette has really expanded,” deJohnette with his Made in Chicago Mészáros enthuses. ensemble (July 17), and Carmen Souza with Theo Pascal (July 18).

The following are the main highlights from the VeszprémFest concert calendar: The FestPresszó venue will host more electronically inclined dance music The main stage will host renowned including Movits (July 17) and Moonlight international acts including former Breakfast (July 18).

Supertramp frontman, Roger Hudson (July 15), retro chartoppers Kool and To learn more about the festival or the Gang (July 16) and jazz diva Dee purchase tickets visit www.veszpremfest.hu.

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4 Socialite

Budapest Business Journal | June 19 – July 02, 2015

WHAT’S

ON MÁV Symphony Orchestra June 19, Liszt Academy Concert Center Having just turned 90 last year, renowned conductor Irwin Hoffman will lead the MÁV Symphony Orchestra through an evening of exclusively Russian works beginning with Rimsky− Korsakov’s Russian Easter Festival, followed by Tchaikovsky’s Romeo and Juliet and Shostakovich’s Symphony No. 5 in D minor, opus 47. This last piece, which was composed in 1937, was originally banned by Stalin. zeneakademia.hu Night of Museums June 20, various venues More than 360 institutions will take part in the Night of the Museums opening their doors until late into the

Fun things to d o in Budapest for the nex t t wo weeks.

evening on June 20 to offer visitors a plethora of exciting cultural programs.

In addition to Budapest, several other Hungarian cities will also take part in the event including Eger, Debrecen, Szeged, and Győr. muzej.hu Champagne Salon June 20, Corinthia Hotel Budapest A wide array of Champagnes and sparkling wines, most of which were produced in Hungary, will be on offer at this year’s Champagne Salon.

Champagne is not just for special occasions anymore; it also makes the perfect summer drink. Grab a bubbly at a five star venue in the heart of Budapest and sample from a fine selection of local and international flavors. facebook.com/ events/1409892472645305

Night of Museums.

Wagner: The Flying Dutchman June 20, 22, 24, Palace of Arts This grand romantic opera is based on a passage from a novel by Heinrich Heine and was composed by Wagner when he was just 30 years old. This

rendition of the opera, directed by Balázs Kovalik, is full of twists and turns and stars James Rutherford in the title role as the Dutchman who travels the seas in search of love. Presented in German with Hungarian subtitles. mupa.hu

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The Budapest Business Journal’s Restaurant Review 2015 is avaliable now!

Best Restaurants of Hungary Business Dining The sweet city European Vacation Special Offers Order now from the publisher! +36 1 398 0344 circulation@bbj.hu

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4 Socialite

Budapest Business Journal | June 19 – July 02, 2015

The Karamazovs June 20, 21, 24−28, Erkel Theatre Freedom, anarchy, God and responsibility are some of the key themes addressed in the story of “The Brothers Karamazov”, a psychological ballet based on the characters of Dostoevskyʼs novel. This fresh and unique reading of the novel uses dance to propel the story forward with choreography by Boris Eifman. opera.hu Irie Maffia June 25, Palace of Arts A Hungarian fixture on the festival and club circuit, Irie Maffia delivers a signature mix of reggae, hip−hop, rock and funk music fronted by four lead vocalists/rappers and a solid band of back−up musicians. 2015 marks the ten−year anniversary of the band and to celebrate, several former members will join the already heaving on−stage lineup to present material from their brand new album, which contains the hugely successful single “Jump Up”. The band performs as part of the Hey June Summer festival at the city’s premium classical concert venue. mupa.hu Classic Indian Film Festival June 25−July 1, Puskin Theatre This week−long festival of classic Indian cinema celebrates the greats across many genres opening with “Mughal−E−Azam” (1960).

Well represented on the festival circuit, the films featured also include underground classics, Bollywood gems and romantic films. The festival will close with a fresh new release, “Queen” from director Vikas Bahl. puskinmozi.hu Deti Picasso, Góbé July 2, A38 Founded in Moscow by a group of mostly Armenian musicians, Deti Picasso presents a unique brand of ethno rock that is powerful and at times hypnotic, held together by the original vocals of Gaya Arutyunyan.

This concert will celebrate the group’s latest release and is the first stop on a

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European tour. They will be joined by musical partners Góbé. a38.hu The Queen of Sheba July 3, 5, Margaret Island Open−air Stage In honor of the anniversary of Hungarian−born composer Karl Goldmark ’s birth and death, the Budapest Summer Festival will present his best−known opera, which tells the story of unrequited love in an exotic setting. This internationally renowned opera holds a very important place in the cannon of Hungarian operatic history and is staged in German with Hungarian subtitles. szabadter.hu Budapest Essentials June 25−28, various venues

Detti Picasso.

In a celebration of urban spaces, Budapest Essentials features live music and DJs performing at the city ’s most significant historical venues, including the Széchenyi Baths, the Hold utca and Grand market halls, the Budapest amusement park, the Railway Museum, Margaret Island and some of the city ’s coolest clubs and ruin bars. La Roux, Katy B, Astronautalis, Solomun, The Wombats, Peter Kruder and many others will be on the bill. budapestessentials.com Armel Opera Festival June 29−July 3

MÁV Symphony Orchestra.

Founded in Hungary, the Armel Festival was created to realize operatic productions that put Hungarian creators in the international spotlight. It presents five operas created in cooperation with five international opera houses with performers selected through an affiliated competition. Opera rarities, contemporar y works and the modern adaptations of timeless classics are presented in Budapest and the festival’s sister venues Opera−Théâtre d’Avignon in France and the National Theater of Pilsen in Czech Republic.

Features works by Donizetti, Mozart, as well as Hitchcock adaptations. armelfestival.org

Champagne Salon.

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4 Socialite

Budapest Business Journal | June 19 – July 02, 2015

Wine: Tokaj overhaul gathers speed A professional marketing firm calls for an improvement of the wine, as well as increased efforts to sell it in the U.S., U.K., and Chinese markets.

ROB SMYTH

While a great deal of effort and cash went into working out that the U.S., U.K. and Chinese markets are the key ones for Tokaj’s winemakers to focus on going forward, I would have happily suggested the same three countries for a fraction of what’s getting shelled out. However, the devil is inevitably in the details, and acclaimed London− based brand consultancy Claessens International Ltd., which is charged with repositioning the bashed up Tokaj brand internationally, has come up with sweeping recommendations aimed at putting the region back among the world’s most premium producers.

“It’s a massive task and we’ve made a start. Monumental research has been ADVERTISEMENT

Above and on facing page: The press conference held by Claessens International Ltd. carried out and we now have a strategic basis,” said Claessens chairman and founder Francis Michael Claessens, speaking earlier this month at a press conference in Budapest, reporting on his company’s first year of work with the Tokaj region. Accordingly, Claessens has developed a set of strategic guidelines designed to rejuvenate the region on the basis of a global survey

involving more than 62,000 respondents from ten countries and consultations with prominent players from Tokaj.

“Hungarian wine doesn’t mean much on a worldwide level but Tokaj immediately triggers a reaction. The main value is the name of Tokaj; it’s the jewel in the crown that has to be looked after,” said Claessens. He added that Hungarian wine “needs a hero on which to hang

everything”. However, Tokaj is a hero in need of a serious top to bottom, inside and out makeover to restore the former glory of what was arguably the world’s first classified wine region.

“Our advice is to improve the quality of Tokaji wine as it’s not as good as it used be. There have been periods in its lifespan when the quality came down and it has to be built up again,” he

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4 Socialite

Budapest Business Journal | June 19 – July 02, 2015

23

EXPERT OPINION

Get connected to WifiZone Renewing Tokaj Kereskedőház Another important box to tick on the region’s to−do list is the overhaul of the region’s largest producer Tokaj Kereskedőház Zrt., which is being renewed with the “most cutting−edge wine making technology in Central Europe”, in the words of the Tokaj Wine Region Development Council. This is an important step, as the entry level of a top wine region has to be high. Tokaj Kereskedőház’s wines, which amount to 40% of the region’s output, have certainly been getting better since the arrival of noted winemaker Károly Áts, formerly of Royal Tokaji fame.

Another proposal put forward by Claessens is the establishment of a regional marketing board, which is currently being formed. This is a great idea, especially as most serious regions have one. It will be based on the model of the brilliantly effective Austrian Wine Marketing Board, and will be responsible for putting the guidelines into practice, which is likely to see changes made to regulations. “There is a broad agreement that the Tokaj product line is far too complex and it should be systemized in a process driven by quality improvement,” said László Mészáros, managing director of Disznókő Szőlőbirtok és Pincészet Zrt., a leading Tokaj winery.

“While the implementation of the guidelines will bring major changes, this is the only way to ensure long− term competitiveness for the Tokaj wine region and the wines produced here, and to attract high numbers of tourists into the region,” said András Tombor, chairman of the Tokaj Wine Region Development Council. His assertion at the press conference that “nothing has happened for 30 years” certainly raised a few eyebrows given the considerable amount that has been achieved in the region since 1989, including the efforts by a number of people in the room in establishing world−renowned estates. However, Tombor appears to possess the kind of “take no prisoners” attitude that will be necessary to get all this through.

This is all just part of a potentially game−changing investment of some €330 million up to 2020 in a bid to re−establish Tokaj’s once legendary status, with the results of a comprehensive survey of all existing and potential vineyards coming up next. Whether it is wise or not to put all of Hungary’s wine eggs in one Tokaj basket remains to be seen, but at least the world is set to hear a lot more about Tokaj.

the standards of wifi connections in public spaces, offering fast internet connections at maximum levels of safety. The system works with the integrated “captive portal” solution, a novelty in Hungary, which helps businesses to reach out to their wifi users, opening space for unique direct marketing purposes.

With the advent of smartphones and tablets, people nowadays like to be online as much as they can. Offering a useful and good wifi connection is not an advantage anymore, but a must. However, with the increasing demand for fast and reliable wifi, the market seems to be lagging behind. In order to fill this evident gap, ACE Telecom offers WifiZone available for businesses around Hungary.

When your customers arrive to your location, based on the unique Service Set Identifier (SSID) of their devices, they automatically connect to your internet service. Thereby, this provides professional solutions for cafés, hotels, restaurants, event locations, malls and other frequented public spaces. The service helps to fulfill the needs of your customers, offering fast and a reliable internet connection, while meeting the strictest requirements of international hotel chains.

Another advantage of the service is the solution of “captive portal”. Captive portal is the homepage for every browsing, with its main task being the regulation of internet access. The compulsory registration prior to browsing is fast and easy, using either email addresses of Facebook profiles. Captive portal offers exciting features for you as a business.

You can monitor user statistics, while on the direct marketing interface you can reach out to your clients with surveys and/or videos. As an extra, you can set up advertisements for the whole network.

WifiZone, therefore, offers a comfortable, fast and reliable internet connection for its users, as compared to the often slow and unreliable free variants. It provides outstanding browsing experience, paired with security settings, ensuring that identity or data theft cannot happen, nor hacking.

Through the connection of WifiZone, users can safely arrange online payments or can log into their private or business networks. Once a registration has been done, the device of your client will connect automatically being near to a WifiZone hotspot. The standard service is free of charge and limited in time or bandwidth, in order to provide an appropriate quality internet connection to every user. For an advertisement free and unlimited connection, users can easily purchase premium access through the captive portal after registering. The account and settings of your customers can be used in the whole WifiZone network.

In Hungary, many business have already decided to operate an internet connection using ACE Telecom’s WifiZone, including fast-food restaurant chain Burger King, SYMA, Westend City Center, Lurdy Ház, NH Hotel, Hotel Adina, Park-Inn Sárvár, Uránia Filmszínház, the ice rink of Városliget, NU Bor and Bisztronómia.

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Your business can offer a unified and secure internet connection, which raises the competitiveness of your services in overall. Using the unique captive portal you can get to know your clients much better, and reaching out to them has never been easier. Also, the captive portal offers many possibilities for direct marketing purposes. Your clients will be able to enjoy a comfortable and safe internet connection, with an easy access and fast sign in, in order to ensure an outstanding browsing experience, and therefore a competitive advantage to you.

NOTE: ALL ARTICLES MARKED EXPERT OPINIONS ARE PAID PROMOTIONAL CONTENT FOR WHICH THE BUDAPEST BUSINESS JOURNAL DOES NOT TAKE RESPONSIBILITY

said, referring to a series of historical shocks, such as the collectivization of communism, which put the emphasis wholeheartedly on quantity over quality. Indeed, Claessen’s observation that some very some very bad wine and “even wine that is practically vinegar is called Tokaji,” is sadly all too true.

While there is plenty of fabulous wine coming out of Tokaj in both the dry and sweet categories, with the “noble rot” blessed Tokaji Aszú regarded by critics as one of, if not the, best sweet wine experiences of all, it only takes a few bad experiences for word to get out that wine from the region shouldn’t be touched with a barge pole. This happens all the quicker in the internet age. Indeed, what many of the world’s current top regions – but by no means all (Bordeaux for example) – have in common is that the consumer knows they can expect a certain level of quality when they pick a bottle of one of their wines off the shelf. The harsh but probably necessary solution is to stop allowing inferior wines to carry the once very good name of Tokaj on the label.

According to the strategy guidelines, only quality sweet wines, in particular Essencia (the rare and very expensive intensely sweet nectar made from the free−run juice of botrytized aszú berries) and Aszú should carry the “Tokaji” brand name in future. Low− priced, inferior versions of these wines will be deprived of the name and the region designation. Late Harvest and sweet Szamorodni wines should also be marketed as “Tokaji” but under a new, grand−sounding name that has a positive marketing effect in global markets. Furthermore, dry Furmints and off−dry wines should use the designation “produced in the Tokaj Wine Region”, while former “semi− sweet” wines should not carry any of the above designations. The rare dry Szamorodni should be phased out according to the proposals.

Given the rising popularity of dry Furmint, it may seem odd that it won’t carry the straight Tokaji name but it will apparently be marketed as a flagship product, alongside Aszú.

By 2020 dry Furmint will account for 60−65% percent of total Tokaj production and about 52−57% of total produced value, according to the Tokaj Wine Region Development Council.

“By the same date, Aszú and Late Harvest wines will account for 13−18% of total production, but because of their higher prices they will account for 27−35% of revenues,” it said.

‘With the spread of wireless services, wifi alone does not put you in an Attila advantageous position considering Farmosi competition. If you are willing to stay competitive, you need to offer an internet Managing Director connection to your customers that is high quality, fast and reliable, and this is what ACE Telecom WifiZone can help you with. We believe that an ICT system can never be finished, Hungarian ACE Telecom is however it can be up to date, and this is the very principle we follow at ACE introducing its new business branch Telecom. An excellent wifi connection can dealing with establishing and easily be differentiated from the others, operating wifi networks, entitled as it is free, unified, fast and easy to use,’ WifiZone, with the aim of unifying said managing director Attila Farmosi.

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