How would you sum up 2007?

 

Jean-Claude: 2007 was a very successful year for our Group, one which saw the ongoing development of our activities in France, with the acceleration in the number of acquisitions and new centers adding a further 35 entities to our network. With over 350 centers in France today, Audika has continued to win over new market share and to strengthen its leading position.

 

Alain: Audika's internal growth rate also reached 10% in 2007, outperforming the market by more than 3 points; all of which is down to our reputation, our strong operational momentum and our successful marketing drives. Not forgetting of course the new and innovative services we are able to provide our customers. Year after year, our business model has proven its worth, hence our decision to duplicate it across Europe, starting with Italy.

 

 

Why choose Italy?

 

J-C: Because of a combination of several positive factors, in particular the fact that the country's market fundamentals are very similar to those of France. We are not venturing into the unknown and are confident that Audika is more than capable of rapidly securing a leading position by calling on the expertise of local, driven entrepreneurs.

 

A: The equipment rate of the hard-of- hearing is even lower in Italy than it is in France and over 50% of the market is made up of independent centers. In fact, our project to work in collaboration with local centers has already prompted a great deal of interest and we have been able to set up a network of over a dozen centers in the space of just a few months.

 

 

Has the Group met the financial targets it set for 2007?

 

A: Absolutely. Our revenue has grown by over 17%, while our margins have grown even faster, thereby confirming the value of our growth model. 2007 saw Audika generate a record operating margin of 19%, a performance which is all the more satisfying since it factors in the investments made in Italy.

 

J-C: What's more, this improvement in our results has meant we have been able to substantially reduce our debt despite our strong growth. As a result, we now have the additional financial resources needed to seize on opportunities as they arise.

 

 

2007 was also a year which saw a change in capital?

 

J-C :The change in capital was indeed one of the key events of the year. The change had no direct impact on the capital of the Group, but rather within its holding company. By repurchasing the shares held by the investment fund, Fonds Partenaires Gestion (equities and bonds) in the holding company, we have reinforced our medium-term positions: a strong sign of our faith in the Group's future and our desire to maintain our family-based management structure.

 

A: We also wanted to join forces with European Capital, a financial partner with a minority stake this time, which will provide its invaluable expertise and help us expand internationally.

 

 

What is Audika's strategy for 2008?

 

J-C:We are going to continue to develop our network in France, which still holds a great number of opportunities. As we have already said, our goal is to capitalize as far as possible as the "oldies boom" generation - our main target category - gradually reaches the age of 65. At the same time, we intend to pursue our marketing and education drives amongst potential customers, thereby reinforcing our market reputation and widening our lead on the competition.

 

A: 2008 will be highlighted by the dynamic development of our activities in Italy, with new acquisitions and the setting-up of new centers. We will be looking to structure our local operations to make sure we benefit as much as possible from the commercial and marketing synergies to be had between the different centers. Given the investments made from the outset, we expect a positive impact on results as of this year.

 

 

And how do you see your development over the medium term?

 

J-C: Our market visibility is extremely good given the very favorable demographic trends that lie ahead, but also given the outstanding progress made in terms of the technology and esthetics of today's hearing aids which mean we are able to attract an increasingly wider and youn- ger category of customer. Communication is the key, particularly amongst the new generation of senior citizens, and we are convinced that the equipment rate, which currently stands at 15%, is set to rise. With France's leading network and an unparalleled range of services, Audika is best placed to be the first to benefit from this expected increase.

 

A: Our European development will also be a vector for growth. Our aim is to rapidly show that the success of our business model in France can be duplica- ted abroad. We are already well on the way to succeeding in Italy and have no intention of stopping there. Over the next few years we will be examining the opportunities to be had in other European countries. We will be paying particular attention to the fundamentals of each market and will choose those countries which offer the best potential to ensure we rapidly rank amongst the market leaders.