In this new exclusive feature Finance Monthly hears from Market Mover Omar Shafi Khan – the CFO and Executive Board Member for the Innovia Group. He is involved with all aspects of the business alongside CEO, Mark Robertshaw. With a lean and highly-talented group team, he works with the firm’s own experienced divisional leadership groups to deliver a strong profit growth and high-cash conversion business with industry-leading financial metrics.
The Innovia Group has been investing significantly in kit and capabilities over the last few years and with an updated and focused strategy, is very well-positioned for rapid growth in its targeted markets. With the completion of the Cellophane business divestment in June 2016, Innovia looks forward to an exciting future focused on polymer solutions.
Prior to joining the Innovia Group, Omar worked in Royal Dutch Shell for 16 years. Throughout his career, he’s held a range of leadership roles across strategy and business development, finance and treasury. He was responsible for improving and growing businesses in more than 70 countries, which has provided him with hard-earned experience in working successfully in different cultures and operating environments. Omar has had the privilege to work across the energy value chain, developing a deep understanding of this sector and the challenges and disruptions it faces.
He started his career with ABN Amro Bank in Asia covering corporate and project finance. Omar has a Bachelor of Arts degree from Rice University and is qualified as a Chartered Management Accountant.
You’ve been CFO of the Innovia Group since April 2015. What have you most enjoyed over the past year and half?
Getting to know our people and sharing in their passion for our products and customers. Innovia is privileged to have a great diversity of people and skills. We have many people who joined us as apprentices and now are in leadership roles. We also have world-leading experts in various fields, some real innovation ‘magicians’, who have proven again and again that they can see beyond the curve and develop products that serve unmet needs for customers. I love that Innovia is a manufacturing company that makes differentiated products which people value and use every day.
What most excites you about the future?
The growth trajectory of our business. One reads and hears so much concern about a low-growth world. Large companies need to buy growth and acquire ever larger companies to find synergies, mostly through cutting costs. Innovia is very different and quite unique. Rarely in the industrial sector does one come across such a compelling set of capabilities and products.
For example, the Bank of England’s new polymer banknotes. The £5, which launched in September 2016, and the £10 which will enter circulation in the summer of 2017, are both manufactured using Innovia’s unique Guardian® polymer substrate and high-security Clarity™C film. This means that the new banknotes are uniquely identifiable due to an in-built ‘fingerprint’ in the polymer film.
What is your biggest challenge?
Ensuring we have the right resources to deliver profitable growth. This means that our people are clear about what they need to do and have the ability and tools to do it. We are delivering record safety, quality and operational performance in a number of areas from which our teams take a lot of pride. This needs to be sustained, improved and delivered in all areas. We have developed and are bringing to market exciting new products. We need to keep doing this efficiently and at quality and cost levels that are a win-win for our customers and ourselves.
You were with a large PLC for 16 years before moving into a Private Equity backed company CFO role. Why did you make this move?
3 reasons: speed, empowerment and accountability. While there are many good things about a large PLC, for example capital market access to funds, deep pools of highly skilled people and established brands, decision making can be extremely slow and management’s incentives misaligned with shareholders. I was very clear that I wanted to be a true ‘owner’ of the business: required to put my own money into the business, fully empowered to evaluate situations, quickly take action and to be on the hook for delivery. Within a couple of months of joining Innovia, we had made our first acquisition and within a year we had agreed to dispose a large legacy part of our business to great new owners who would treat our employees and customers very well in line with our values. My wife, who is very wise, understood the move away from my career at Shell and the investment in Innovia meant more risk for our family, especially with young children to look after, but she was hugely supportive and as she says, I enjoy every day at work now and ‘walk lighter’.
Has it been difficult to adjust to a PE-backed-company vs a large PLC?
It has been much easier than I could have hoped. Firstly, because of the quality of people in my team and in the company. Secondly, I was lucky that Mark (CEO), our Chairman and PE managers really believed that I could make a successful transition and have been very helpful. Thirdly, I had been investing as an Angel in early-stage companies since the late 2000s and was used to investing my savings as well as experienced first-hand the challenges and opportunities of growth businesses. Finally, my family and I are loving living in the Lake District with its stunning scenery and friendly people!
Any advice to others who want to make a similar transition?
Be honest with yourself and ask those you trust to help you really understand what motivates you and makes you happy. Remember, this kind of move is not just about ‘getting a job’, you have to invest financially as well as emotionally. You have to believe in the company and its products and have chemistry with the people. So the risks are higher, but so are the rewards.
The Innovia Group is one of the world’s leading Advanced Polymer Solutions Providers. The group’s solutions provide customers in around 100 countries with a combination of enhanced security and brand integrity; improved downstream manufacturing performance and cost; and reduced environmental impact.
Innovia is technology-led with world-leading R&D from two dedicated centres and over 60 scientists worldwide, most of whom are PHDs or graduates. Manufacturing processes are proprietary-based on unique in-house engineering expertise. These purpose-built assets, combined with extensive know-how, application expertise and customer knowledge produce a highly differentiated product portfolio across specialty polymer films, coating, high-quality printing and security applications.
Innovia has longstanding customer relationships with strong global leadership positions in its targeted markets around the world. Foremost, amongst these is the market for the production and printing of polymer banknote substrate. Innovia produced the first Guardian® polymer banknotes in Australia in 1998 and now has produced circa 50 billion Guardian® polymer banknotes across 24 different countries which represent more than 99% of all the polymer banknotes ever made in the world. The company is currently producing the £5 and £10 banknotes for the Bank of England which will be the 25th country on Guardian®. Key attributes of polymer banknotes are enhanced counterfeit resilience, ensuring that a nation’s currency is secure, durability, resulting in significant cost savings across the cash chain, improved hygiene and ability to recycle used notes.
Innovia Group serves its customers through a 4-site manufacturing footprint, covering all main continents and 16 sales and technical offices across the world. The company is headquartered in Cumbria, UK and exports over 90% of what it produces. Innovia prides itself in being integral part of the local communities where they operate while delighting customers across the world.
‘The £5, which launched in September 2016, and the £10 which will enter circulation in the summer of 2017, are both manufactured using Innovia’s unique Guardian® polymer substrate and high-security Clarity™C film.’