Export success despite strong krone

With an export share of nearly 80%, Egil Norman Olsen, the managing director of Hernis Scan Systems, should be among the loudest howlers over the strong Norwegian krone. But he is not. In our interview he only mentions this issue in an aside: "Of course we also notice the impact of exchange rates. But we do not compete primarily on price," he says.

Business is better than ever. They are increasing sales, earning money and employing people. They have also moved into new premises measuring 800 square metres in the course of the past eighteen months.

Record year

Last year was a record year for the company, with sales close to NOK 100 million as opposed to approx. NOK 78 million the year before. Profit before tax was NOK 8.1 million. The number of employees also grew from 61 to 68 during the year.

"This trend appears to be continuing this year, too. We are already 74 employees in Arendal and two in Singapore, and we expect to reach our budget of NOK 120 million," says Norman Olsen.

The Norwegian offshore industry is still the largest single area for Hernis Scan Systems' closed-circuit TV (CCTV) systems. Nevertheless, this year Hernis has decided not to attend ONS in 2002 in Stavanger this autumn as an exhibitor.

"Since the company was founded we have attended every single year, both in Aberdeen and in Stavanger. This year we want to prioritise a little differently. We were at OTC in Houston in May. In June and August we will be arranging customer and dealer seminars on our own premises here on Hisøy and under the auspices of our subsidiary in Singapore," says Norman Olsen.

In addition Hernis will be represented in the Norwegian pavilion at SMM in Hamburg in September and at OSEA in Singapore at the end of October.

Uncertainty in the cruise segment

The trend in the offshore market showed steady growth all last year. With regard to orders received in the cruise market, which has gradually become an important area for Hernis Scan Systems, this market suffered a blow after 11 September. Several planned projects were postponed indefinitely due to the uncertainty arising after the terror attack on New York.

"However, recent figures indicate that this is turning around. That is why we are counting on an increase in orders received in this area this year. For instance, we delivered equipment to The World from Fosen Mekaniske Verksted, and we have an option on an RCCL ship that is to be built at the Meyer shipyard near Hamburg," says Norman Olsen.

The terror attack on the World Trade Center has also led to a general increase in the need for security equipment and surveillance. This applies not only to offshore and aboard ship, but also to various types of land-based facilities.

Deliveries to the military

Hernis Scan Systems is to deliver surveillance systems to the new Norwegian frigates. With this order as a reference, they have also received a similar order for six Malaysian patrol vessels that are being built in Germany.

"But the biggest new order for deliveries to the military is going to the U.S. Army's facility for destroying mustard gas in Newport, Indiana. We will be providing TV-monitoring of the actual process. We feel that with this and previous orders that we have gradually got a foothold in the American market," says marketing manager Tom Cantero. He adds that Hernis was also represented by a presentation at the Gulf Offshore conference in Mississippi earlier this year.

Security packages

Hernis may also be considering teaming up with other Norwegian manufacturers of security equipment in order to offer more complete security packages, which also include access control and fire alarms, for example. "We already have a collaboration with Autronica and are in talks with Phontec in Horten," says Norman Olsen.

The new threat has meant that Arendal-based company has begun to sniff out new product areas. For instance, they are testing heat-sensitive cameras, possibly combined with radar. These have become increasingly relevant in connection with protecting ships from pirate attacks and guarding harbour areas against unauthorised traffic.

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