DESMI Expects a Three-Digit Million Increase in Sales Within a Few Years

By MarEx 2012-10-29 11:38:45

The Danish pump manufacturer, DESMI, has often delivered products for defence purposes, but is now intensifying its focus on this area and estimates to have a resulting increase in turnover of more than 100 million DKK within a few years.

DESMI has employees in 26 locations spread all over the world and main production facilities in Denmark and China. The main part of the sale for defence purposes was previously handled by the subsidiary in England, but has been transferred to a newly established project organization and a new segment manager in Denmark.

“We have been working hard in this area since January and our market study has confirmed that there is a basis for intensifying the efforts and investing the necessary resources”, says Henrik Sørensen, CEO.

He informs that the company has a good overview of the coming marine projects for defence pur- poses all over the world and has selected the countries that are of greatest interest to DESMI.

Expert in Defence Business

“India plans a number of big naval shipbuilding projects, and so do Canada and Australia among oth- ers”, says Niels Buus, Segment Manager, who joined DESMI in January.

Niels Buus was previously managing director of Gatehouse and has since then been working within the defence business. He is generally well known in the defence business and combined with his management experience this makes him a strong asset for DESMI.

DESMI has for many years delivered marine pumps and in that way also delivered pumps to the Navy. As an example, several DESMI pumps have been installed in “Esbern Snarre”, the flexible Danish Navy support ship of the Absalon class.

Navy PR Cruise 

“Some months ago “Esbern Snarre” was used for promotion in USA”, says Henrik Sørensen. “We and a number of other suppliers from Naval Team Denmark were on board when the ship called into four ports to be displayed to representatives from the US Navy, and this was a unique opportunity for us to present our products”.

“We could take the US Navy representatives to the engine room and show them the pumps that we had delivered”, says Henrik Sørensen.

He points out that “Esbern Snarre”, built at Odense Steel Shipyard, is produced significantly cheaper than naval vessels usually are because of the use of commercial products adapted to military pur- poses. 

“It attracts great interest abroad that it is possible to build naval ships at such prices. Normally prod- ucts for military purposes cost significantly more because it is a rather closed world with much less competition and more special requirements than in the commercial world. This is one of the reasons why we expect to do well in this area”, says Henrik Sørensen.

He underlines that the pumps are basically the same whether used in a cargo ship or a naval ship.

“Products for defence purposes must be able to withstand the vibrations that arise in case of firing, and consequently we must supply shock-proof pump systems, but fundamentally the pumps are the same”.

Also on Land and in the Air

Niels Buus emphasises that the new target area does not only concern delivery of pumps for ships, but also delivery of pump systems in different designs for aircraft and helicopter fuel-handling on land, at sea and in the air.

“We have for instance delivered equipment for relief work in many places of the earth where fuel for aircrafts or trucks must be handled. There is not much difference between diesel and aircraft fuel, so our pumps can be used for many purposes”.

Supplier to Aircraft Carrier

In addition to “Esbern Snarre” and the Danish frigate “Iver Hiitfeldt” DESMI also delivers pumps of many different designs for a total amount of 40 million DKK for a new British aircraft carrier.

“We have also received an order in connection with a new series of tankers for the British Navy. This is the first time that England builds ships for defence purposes outside England, and the new ships are built in Korea where our local department is involved. So far we have secured one of the orders and we are working on securing more orders for this new series of ships”, says Henrik Sørensen.

He mentions that growth is definitely a success criterion in the new target area, but that it does not necessarily mean that the total workforce of the company in Denmark will be increased.

“It is difficult for many manufacturing companies to compete with the hourly wages in the East when it is a matter of standard production, but special production for defence purposes includes many spe- cial requirements. Even if the basic product is manufactured in our factory in China, it still makes sense to make the final adjustments and mounting of the systems in the West, and we therefore ex- pect to generate jobs for engineers, project managers, and employees for special production.

This is an example of a small bright spot in the otherwise general trend where production moves east”, says Henrik Sørensen.