Published: November 15, 2011
Le Lettre du Trésorier
Could you tell us about Gemalto?
Didier Lo Nobile
The poduct of a merger in 2007 between a company of French origin, Gemplus, and Axalto, a division of Schlumberger, Gemalto is the world number one in digital security, which can be in the form of objects, software or services, in areas as diverse as wiring, identification – we are talking about biometric passports - security, with bank cards, or even health, with the Carte Vitale [the French health insurance card]. The group, which has over 11,000 employees, has over 75 sites and is present in a hundred countries, achieved a turnover of €840m in the first six months, a sum which does not take into account the acquisition, in June, of Cinterion Wireless Modules, a German company which provides wireless communication modules for industrial machine-to-machine use and whose turnover rose to €145m in 2009. Gemalto is listed on Euronext, in section A, its stock is listed on the SPF 120 index and the market capitalisation was €2.8b on 21 October 2010.
How is the treasury of the group structured?
The treasury is organised in such a way that it can bring the operational structure of this very international group together. There are four regional treasury centres, one in Asia, one for each American zone and one for Europe, the Middle East and Africa. These centres come under a central treasury, located at the headquarters in Meudon, near Paris, where four people work, mostly in currency, cash management and investment – the company is structurally in surplus.
Where currencies are concerned, the decision to hedge risks, whether they are operational or economic, is done on a case by case basis, taking net exposure and cost of hedging into account. Net exposure, when we decide it is necessary to hedge, is effected through forward transactions or options, contingent on market conditions. In all, the treasury is made up of about fifteen people. In the field of concentration of liquidity, there are two identical cash pools: one in euros with BNP Paribas, which we intend to automate, the other in dollars with Citigroup. Countries that do not have access to either of these cash pools are linked up to the central treasury and are included in the global web network.
In addition to responsibility for the Eurozone, the Middle East and Africa, you are in charge of cash management for the group, its technical aspects in particular. What developments are there in this area?
We are looking at bank charges in France, for example. Therefore, with the help of the consultancy bfinance, we put out a call for bids at the end of 2008, to which six banks replied; three, who were actually already providers, were retained. The outcome of this detailed review is easy to see: annual bank charges were halved and are now less than €100,000. Currently we are putting the same system in place in Asia, where we have already organised a call for bids ourselves, with the aim of reducing our banking costs by half. This area of the business requires a lot of attention to detail and time, particularly because local banks provide very full documentation, probably three times more than in France.[[[PAGE]]]
What about banking communication?
Taking in to account the importance of Gemalto’s foreign offices, our thinking in this department has been global: it was a matter of rationalising banking communication, and not of replacing an old-fashioned protocol, Etebac, in France. Our choice was naturally SWIFTNet, which meets our needs in terms of security and universality, and which, we have calculated, will allow us to save between €200,000 and 300,000 per year in bank charges, once all our offices have begun using it. These offices could do without local systems or internet banking. With the Datalog Cash Pooler software, which we have been using since 2004, we now have a banking communication tool which has a unique channel for every operation and with every bank. We formatted our messages ourselves with the help of Utsit, in XML format, in order to be able to carry out SEPA – SCT – or non-SEPA transfers, which represents a double gain, in terms of both transmission and development costs. The difficulty was in getting our banks to accept this: now they have all done so, except for one which will begin using this format in the coming months. Thanks to the service offered by Synthésis, when we carry out mass payments to our suppliers and our employees, we receive MT940 and CFONB 120 readings, and will soon be able to send and receive FIN MT 101 messages.
What is the schedule for the switchover?
After a period of reflection and research, whose conclusions were validated by the financial director at the end of 2009, the operational phase began properly at the start of 2010. To begin with, it was necessary to manage two areas at once, one technical, the other legal. The second one took a good two months, because despite the existence of a model contract – the contract of exchange between banks and companies via SWIFTNet, formalised under the auspices of AFTE - it is necessary to negotiate in detail with each bank. At the very beginning, we got help from the consultancy Utsit, who gave us the impetus, but we aimed to lead the project ourselves, which has been possible due to the support of Sarah Bernhamidat, an engineer trained at CESTI, who for the last five years has managed projects on ‘financial’ applications of all types and who has, since last year, dedicated on average half her time to the SWIFTNet and SEPA projects. The first switch took place in June in France, for mass payments and statements. This was followed by Poland, then the treasury group, and, planned for 2011, Germany, Singapore, which is our door into Asia, Finland, Sweden, other areas of the French business, following a schedule parallel to putting in place an ERP shared by all offices.
What was your career path up until now?
I went straight into treasury after my higher education (a Masters in Business Management at IAE Aix-en-Provence) as assistant treasurer at Medtrans, a transit company. Then I began a long progression in Gemplus: assistant treasurer, EMEA credit manager, treasurer and EMEA credit manager; then at Gemalto, as treasurer of EMEA, and since October 2009, treasurer of EMEA and Head of Cash Management.
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