Rethinking the blueprint

While AB Inbev can proudly point to its five-year compound annual growth rate as being best in class among its global fast-moving consumer goods peer group, construction group Aveng will have to work a little harder to find a podium onto which it can hop.

Perhaps the most promising factor in its results announcement was the frank acknowledgment that the company is at an inflection point at which it requires positive and decisive action to ensure it has a sustainable future, otherwise it really could be “last man out turn off the lights” time.

The company has embarked on an extensive strategic review, with the help of professional advisers, to determine what businesses and assets are worth hanging onto, to design an optimal operating structure, and to head towards a sustainable capital and funding model for the future. This is about as deep a dive into the fundamentals as you can take without using a bathyscaphe — and now that a plan has been developed, the challenge over the next two to three years will be to implement it.

There are six key pillars to the strategy: simplify, reshape, grow, dispose, deleverage and unlock shareholder value. The hope is that once these principles are put into practice the group will emerge leaner, more profitable and less indebted, and able to focus its energies on the business areas that show the greatest potential.

This will be an immensely challenging and disruptive process, especially given the state of many of the company’s markets at the moment, but it is necessarily strong medicine to ensure the health of what remains.