July 9, 2010 / 12:54 PM / 7 years ago

INTERVIEW-Arvato CEO says Q2 went well, poised for growth

* Back on track after hit from financial crisis

* Sees return to sales growth in 2010

* Aims to perform better than outsourcing market

By Nicola Leske and Peter Maushagen

GUETERSLOH, Germany, July 9 (Reuters) - Arvato, the services unit of German media conglomerate Bertelsmann [BERT.UL], has seen brisk business in the past four months and aims to outperform the outsourcing market this year.

“We expect the outsourcing market to grow 5-6 percent annually ... and it is our goal to grow more than that market,” Arvato Chief Executive Rolf Buch told Reuters in an interview.

Arvato has become the group’s fastest-growing business, branching out from printing and media-related services into call centres, financial clearing houses, government and mobile services.

“January was affected by uncertainty ... but March, April, May and June went very well,” said Buch, who succeeded Hartmut Ostrowski -- Bertelsmann’s current CEO -- as head of the business in 2008.

Arvato employs more than 60,000 staff, almost half of the media group's total employees, and it includes almost all of Germany's blue-chip DAX .GDAXI companies among its customers and also global giants such as Microsoft (MSFT.O).

“We had expected to have more opportunities last year because of the crisis, thinking it would force companies to cut costs ... a great opportunity for us,” Buch said.

“What really surprised me was that instead companies were shocked into paralysis and did nothing or decided to bring some processes in-house again,” he added.

CHINA PLEASES

Companies are seeing a stronger recovery but many remained cautious about the sustainability of the upswing, Buch said, adding: “One should be cautious but there’s no reason to be depressed.”

The 45-year-old trained engineer and logistics expert said Arvato stood to benefit from the recovery and would return to revenue growth this year after a 3.5 percent sales decline to 4.8 billion euros in 2009.

Arvato is mainly active in Germany and the rest of Europe, with some U.S. operations but like many corporations has high hopes for operations in China.

“What I find really encouraging is the Chinese business. It has high double-digit growth annually although that still hardly shows on Arvato’s books,” Buch said.

China generated some 70 million euros ($88.77 million) in revenue in 2009 and Buch said he expects double-digit growth to continue.

Asked which areas would prove challenging in the future Buch said that among other things Arvato’s call centre position in English speaking countries was weak.

“We are the number one in Germany and among the leading ones in France and Spain but in Great Britain we’re way behind the top ten,” Buch said. “To be among the top ten, we would have to win some really good deals,” he added.

“It’s not something you can fix in the short-term,” Buch said.

($1=.7885 Euro)

(Editing by Jon Loades-Carter)

((nicola.leske@thomsonreuters.com; +49 69 7565 1214; Reuters Messaging: nicola.leske.reuters.com@reuters.net)) Keywords: BERTELSMANN/ARVATO

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