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We can clearly see that our global business model, built on the basis of a local presence and global resourcing, has helped us achieve a sound result for 2013.

CEO’s review:

The journey continues apace 2013 marked the 10th anniversary of the Wärtsilä business transfer to Citec. This was a particularly memorable event for me personally, as I was one of the employees outsourced to Citec. With the benefit of hindsight, these past ten years have proven to be the start of a truly fascinating journey, which still continues apace to this day. Looking back along the strategic path that Citec has travelled, we see that important new engineering competence has been gained through company acquisitions. In terms of new countries and locations, we are glad to add both Norway and Singapore to the Citec map. With these new additions, we are currently 1,200 experts operating in nine countries around the globe. In April 2013, Citec gained key oil & gas competence through the acquisition of the French oil & gas engineering consultancy Akilea Engineering. A few months later, in August, we acquired Norweigan M7 Offshore. As a result of these acquisitions, our new global Oil & Gas industry area was established. Citec Group’s financial performance remains strong as the revenue for 2013 reached approximately 70 MEUR with an EBITDA of 10%. It is fair to summarise this as a good achievement, and the result stands up very well in comparison with our competitors. We can clearly see that our global business model, built on the basis of a local presence and global resourcing, has helped us achieve a sound result for 2013. I am particularly satisfied with the strong progress regarding India’s domestic sales. We also saw concrete results in Finland from our active and focused sales efforts conducted throughout the year. We will continue to focus on country-driven operations, providing engineering and information management services for the energy, oil & gas and manufacturing industries. Citec is becoming a notable player on the market, and our customers’ confidence in our competence and ability to deliver challenging projects is steadily growing. My sincere thanks to Citec’s customers, personnel, the board and partners for a great year. Stay tuned for an exciting 2014, which also marks Citec’s 30th anniversary. But first – have a look at what we achieved in 2013. Enjoy! MARTIN STRAND CEO






Vaasa, Helsinki, Turku, Tampere, Oulu and Pietarsaari








Mumbai, Bangalore and Chennai


Kassel and Hennigsdorf

Paris and ContrexĂŠville


Billingstad and Stavanger









Karlstad and Uppsala



7 9 4

6 3

1 5

2 8

What we do ■  Citec provides multi-discipline engineering and information management services to the energy and power industry, the process industry, as well as other technology dependent industries. For instance, we have built power plant projects for a wide range of industrial customers. We work closely with our customers in projects, providing everything from single discipline engineering to turnkey designs including concept, basic and detailed engineering, as well as technical documentation and final as-built drawings. Citec was founded in 1984 – and thus celebrates 30 successful years in 2014.

Citec has delivered projects to

109 countries all over the world.


Going for oil & gas New acquisitions bring strong expertise to Citec

In 2013, Citec made a significant investment in the oil & gas industry by acquiring two highly qualified engineering companies; Akilea Engineering in France (Paris) and M7 Offshore in Norway (Billingstad and Stavanger). M7 Offshore is also present in Singapore. Through these acquisitions Citec today has more than 100 specialised experts in the oil & gas industry.


The oil & gas industry investments in the world in 2013 were estimated to be about 650 to 690 billion euro annually for exploration and production. In 2014, investments by oil & gas companies may rise as much as eight percent. Thus even a small share of a fraction of a percent of that market means tens of millions in turnover. Citec sees growth opportunities, especially in different types of offshore vessels (FPSOs, FSUs, FRSUs), other topsides, as well as LNG and pressure vessels. We now hold a high level of competence in all of these areas. The oil & gas production is divided into three main areas: upstream, midstream and downstream. Upstream refers to the exploitation and production of oil & gas, midstream deals with transportation, while downstream covers the refining and trading of the refined products. Thanks to the acquisitions of Akilea Engineering and M7 Offshore, Citec now has a strong expertise in all of these areas. Citec’s customers in the field are oil companies, contractors, ship owners, suppliers and engineering companies.

Today we have more than


specialised experts in the oil & gas industry.

CITEC’S STRONG POINTS IN THE OIL & GAS OFFERING: • One stop shop – complete oil & gas service provider within multidiscipline engineering, information and project management services • Modularisation – design experience from large-scale offshore modules up to 1,300 ton • Close to the customer – local presence and global resourcing • Proof of concept – competence and solid references • Experience – in the global engineering industry since 1984

Citec India Ten years of solid operations “Citec India operates in both the domestic and the international market. Our sales areas include the Indian market and the markets in the Middle East, specifically Saudi Arabia. We established operations in Saudi Arabia in 2011 in association with Alrabiah & Partners, and the same is aimed to soon be converted into a joint venture and to include South East Asia.”

 2 /3

of Citec’s employees are expected to come from India in 2016

“Citec India provides support in all stages of plant development with a multi-discipline design strength consisting of process, mechanical, piping, civil, structural, electrical, instrumentation design, procurement assistance and information management. Apart from power plants, refineries and pulp and paper plants, we have always been exploring new areas of competence and have worked independently on, for example, fertilizer projects, solvent regeneration units, acid gas removal units, sulphur recovery units, steam management studies and cross country pipelines.”


“India’s focus ahead is towards developing competence in LNG engineering services, offshore engineering services and strengthening our competence in product data management, as well as manufacturing and process plant engineering services. Citec’s strategic goal is to increase the number of employees in India to twice the headcount by 2016. This means that two thirds of Citec’s global resources are expected to come from India.” “2013 has definitely been a year of significance for us. We have strengthened our growth strategy, opened doors to new customers and developed expertise in new areas, as well as expanded and refurbished our offices. Another highlight was that we hosted Energy Vaasa’s Energy Ambassador campaign, and had the opportunity to meet the Finnish Foreign Trade Minister, Alexander Stubb, in conjunction with that.” NASIR MULANI, MANAGING DIRECTOR, CITEC INDIA

CITEC INDIA Established: 2004 Employees: 430 (a third of all Citec employees) Offices: Mumbai, Chennai, Bangalore

CITEC’S COMPETENCES Quality Management 2% Sales 2% Support 6%

Nuclear 1% Civil Engineering 16%

IM / IT 3% Project Management 4%

Information Creation & Management 19%


Mechanical Engineering 29%

Process Engineering 10% Electrical Engineering 10%

Our employee satisfaction surveys show a clear correlation between workplace satisfaction and participation in learning and development activities.

Proudly presenting our passionate experts “Citec’s team of experts possess a wide range of competence ranging from engineering discipline and information creation to project and quality management. Citec is built upon the expertise of our personnel. As expertise needs to be updated and developed continuously, we systematically work at incorporating competence development into our project work. It is self-evident that it is the daily work that teaches you the most, even though attending courses is useful, too. The obvious way to learn new things is by taking on new responsibilities and roles. It may be working with a totally new customer, a different type of plant or shouldering a greater responsibility. People will apply their existing knowledge and experience and also learn something new in the process. We also encourage people to rotate within the workplace, take on other roles, as well as transfer to Citec offices in other countries. Our employee satisfaction surveys show a clear correlation between workplace satisfaction and participation in all learning and development activities.” KATARINA WESTERÉN-HAGNÄS Director, Group HR & Business Services

Employees: 1,200 Average age: 37 years Nationalities: 20 Men: 75% Women: 25%



Our project management process was developed from operational work and has been fine-tuned over the years. We know it works in practice.

Customer understanding and attention to detail PROJECT MANAGER MIKKO HAKOLA HAS AN EXTENSIVE TRACK RECORD WHEN IT COMES TO DEALING WITH COMPLEX ENERGY AND MANUFACTURING PROJECTS. HE JOINED CITEC IN 2003 FROM WÄRTSILÄ POWER PLANTS. MIKKO, HOW WAS YOUR 2013 AT CITEC? “Earlier I participated a lot in very large, similar engineering projects. However, 2013 was different as I was put in charge of a large amount of specialised smaller projects. 2013 was also the year when I got the opportunity to work closely with ABB and Wärtsilä in their sales projects towards their end customers. Personally, I feel it is very exciting to be involved in the early phase of a project as it enables you to get a very good grip of the expectations, even before the actual project starts. This way we can serve our customers even better.” WHAT DO YOU THINK ARE THE KEY SUCCESS FACTORS IN CITEC’S PROJECT MANAGEMENT? “I believe that we have a clear project management process, and we follow it. The process itself was not invented as a stand-alone case; rather it was developed from operational work and has been fine-tuned over the years. We know our process works in practice. Another important factor is that we openly share our experience and information, which creates a forceful ‘can do attitude’ across the company.” HOW DO YOU MAKE ALL THIS WORK IN PRACTICE? “In order to succeed in project management you must blend the right competence, possess experience, understand the customer in practice and be a master in people management. Project communication is also part of the key – everyone should be aware of the direction, potential issues, responsibilities and timetables. Finally, it is vital in projects that top quality engineering and information management services are delivered. Attention to detail is definitely a must in our industry.” WHAT IS THE BEST FEEDBACK YOU HAVE EVER RECEIVED FROM A CUSTOMER? “The answer is very simple: the best feedback is when the customer shows satisfaction with a project by ordering more work from Citec. Nothing can replace the feeling of winning with your team.”

During his time at Citec, Mikko has been in charge of the engineering of over


power plants with a total capacity of more than 3.5 GW.



A giant power plant in the desert 12

POWER PLANT, JORDAN, AMMAN • Sixteen 20 MW 18V50DF engines, net power 250 MW. • Tri fuel plant: uses light or heavy fuel oil or gas • End-customer: AES, USA • Citec’s engineering hours: 49,000 • Engineering began in autumn 2012; construction work started in winter 2013, completed in summer 2014.


The order was to build a vast power plant on a small area of land. The conditions

Over the years, Citec has helped Wärtsilä design more than

1,000 power plants.

were Jordan’s dry desert landscape and very strict owner and official requirements, especially with respect to health, safety and the environment (HSE). Citec produced all of the engineering and documentation for the plant. Project Managers Timo Kumara of Citec and Kai Kettu of Wärtsilä are satisfied and relieved – and with good reason. As the project progressed, the number of requirements grew, and the engineering work expanded massively. “The site was full of unusual features that we had to grapple with. Each discipline had its own challenges, but Citec succeeded in everything it did”, says Kettu. In summer 2014, the 250 MW power plant’s 16 engines began to generate electricity for the Kingdom of Jordan’s grid. The power plant will use heavy fuel oil until 2015, when gas will start to arrive via the Amman pipeline.

THE JORDANIAN POWER PLANT project is in many ways exceptional and has broken many records. It was unusual that the power plant’s building permit was within Wärtsilä’s remit and a significant amount of engineering had to be made before Wärtsilä’s EPC contract was signed. Citec therefore started the engineering work at a very early stage. “It’s also exciting for us to do all of the engineering and documentation for a project. It has been an enormous amount of work, i.e. around 49,000 engineering hours”, says Kumara.

EVERYTHING WENT WELL from the very beginning: when the excavator bucket hit the sand, a whole hillside was cut away and more than 100,000 cubic metres of soil was removed. As there are people living on a nearby hill, noise had to be minimised as well. That’s why the fuel tanks were built side by side, forming a sound barrier. And because of that, an efficient tank cooling system had to be engineered in case of fire. “Due to Jordan’s fire standards and limited water resources, a larger than usual fire-fighting and raw water storage tank was added to the site.” says Kumara. Kettu considers that the close cooperation between Wärtsilä and Citec contributed to the success of the project. “The site is small but it has a huge number of structures, pipes and cables. Although installation has been challenging, we managed to fit everything perfectly together, thanks to Citec.”


PARTNERSHIP WITH WÄRTSILÄ Wärtsilä has been a key partnership customer for Citec for several years. In Wärtsilä’s power plant projects, Citec is an important partner able to offer Wärtsilä resource and competence flexibility through the partnership agreement. With the help of Citec, Wärtsilä achieves very fast delivery times. Over the years, Citec has helped Wärtsilä design more than 1,000 power plants.


EPCM project Biomass-fuelled CHP plant, 20 MW fuel power

LOCATION France CUSTOMER A leading energy efficiency solution provider CUSTOMER CHALLENGE The customer needed to construct a 20 MW biomass-fuelled power plant for electricity and district heat production at a new site in France.


SOLUTION Citec’s solution was to provide full EPCM services. PROJECT DESCRIPTION • 2000 m³ Automated wood-handling storage • 20 MWth Biomass boiler • 6 MWe Steam turbine • Air-cooled condenser • Demineralized water production and utilities • Buildings and civil works • Electrical distribution network • Control system CITEC’S SCOPE OF WORK, FULL EPCM-PROJECT INCLUDING • Pre-study with site layout, process specification and cost estimations • Writing of RFQs for different packages • Selecting suppliers • Writing files for administrative authorizations • Basic engineering • Management of suppliers • On-site coordination • Commissioning assistance • Documentation and training

WHY CITEC? The main reason for the customer choosing Citec as the EPCM contractor for this project was due to Citec’s proven expertise in the area of bio-fired power plants and EPCM deliveries. CITEC HAS • EPCM capability • E xperience in FEED (thermodynamics and power plant cycle set-up, preengineering) • E xtensive multi-discipline engineering management and engineering experience • Solid and proven knowledge of thermal power plants • Substantial experience of biomass combustion • Customer-oriented solutions • Layout optimization services


Tailor-made FSRU’S for Hamworthy / Wärtsilä

PROJECT Seven different projects for tailor-made FSRU modules CUSTOMER Hamworthy/Wärtsilä END CUSTOMER Höegh LNG CUSTOMER CHALLENGE The customer wanted to ensure that the solutions for their Floating Storage Regasification Units (FSRUs) were optimised and cost efficient. SOLUTION Our solution was to provide the needed competence and resources for the projects. PROJECT DESCRIPTION We were selected to provide seven modules; the customer required that there would be a tailor-made solution for each module. In addition, the customer wanted the solutions to take full advantage of opportunities to reuse the engineering solutions used in previous modules. The four most recent projects were for the end-customer Höegh LNG, who ordered four FSRUs from Hyundai Heavy Industries. The Regasification modules are provided by Hamworthy/Wärtsilä. The vessels are DNV classed, have a length of 290 metres, a storage volume of 170 000 m³ and are powered by Duel Fuel engines. The first vessel will be delivered to PGN offshore Sumatra, Indonesia, and the second to the Port of Klaipeda in Lithuania. At present the third vessel, is optioned for use in Quintero bay, close to Santiago in Chile. The forth vessel is a generic design for future customers.

SCOPE OF WORK Services included module layouts/area engineering and document control for the Regas modules. Each module is around 700-800 tonnes with an approximate size of 20 x 30 metres. These projects were executed by Citec Norway. KEY RESULTS We accepted the challenge to create the most optimal and cost-effective solutions available. The key result from these projects is that a considerably reduced amount of engineering effort was required for each of these FSRUs.



Citec’s profitability improved to


MEUR in 2013


We saw the profitability improve and are very strongly positioned in the energy industry. This is our selected growth area.

A strong result “Competition within the engineering market is fierce, especially in terms of pricing. The largest risk scenario in our business involves a potential financial recession, which may delay investment decisions.” “I would like to characterise Citec’s result as strong. It is proof that our operating model, with global resourcing and a local presence, is working well. Citec’s net sales rose to 70.2 MEUR compared to 66.6 MEUR in 2012. We also saw the profitability improve from 5.3 MEUR in 2012 to 7.0 MEUR in 2013. We are very well positioned towards growth segments such as energy, process, manufacturing and civil engineering.” MARI KYTÖHARJU CHIEF FINANCIAL OFFICER


Net sales


1,000 €


1,000 €







% 10 8 6 4
















citec group Income Statement


1,000 EUR NET SALES Other operating income Material and services Personnel expenses Depreciation and write-downs Other operating expenses OPERATING RESULT Financial income and expenses RESULT BEFORE EXTRAORDINARY ITEMS RESULT BEFORE TAXES Income tax Minority share RESULT FOR THE ACCOUNTING YEAR

1.1.– 31.12.2013


70,168 301 –10,835 –41,457 –2,748 –11,139

66,591 346 –9,176 –40,085 –2,528 –12,352







2,148 –1,432

475 –791





Board of Directors Eero Leskinen, Chairman of the Board, Investment Director, Sentica Partners
 Christer Niemi, Investment Director, Sentica Partners Clas-Eirik Strand, Consultant, Martecheng Per Bragée, CEO/Owner at Yesper AB Rune Westergård, Founding Partner, Citec

citec group Balance Sheet 1,000 EUR 1.1.–31.12.2013 1.1.–31.12.2012 ASSETS FIXED ASSETS 33,321 27,888 CURRENT ASSETS 25,415 24,751 ASSETS IN TOTAL 58,735 52,639 EQUITY AND LIABILITIES EQUITY 8,715 7,887 MINORITY INTEREST 673 0 PROVISIONS 667 839 LIABILITIES Long-term liabilities 30,333 25,853 Short-term liabilities 18,347 18,059 LIABILITIES, TOTAL 48,680 43,913 SHAREHOLDERS’ EQUITY AND LIABILITIES 58,735 52,639


MANAGEMENT TEAM Martin Strand, Chief Executive Officer Mari Kytöharju, Chief Financial Officer Mikko Juopperi, Director, Engine Power Sakari Koivuniemi, Director, Oil & Gas, COO Citec Finland Mats Söderlund, Director, Energy & Civil Nasir Mulani, Managing Director, Citec India Gary Manders, Director, Process Industry & Manufacturing, Managing Director, Citec Sweden Katarina Westerén-Hagnäs, Director, Group HR & Business Services Michael Smirnoff, Director, Group Marketing & Communications Ted Bergman, Director, Competence Services Finland

OWNERSHIP 13% Sentica Partners

20% 67%

Citec founder, Rune Westergård Citec management

Concept: Mantra Communications. Design: Studio PAP. Print: Forsberg 2014

Citec Annual Report 2013  
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