Javier Diaz Gomez, Country Manager Saudi Arabia, FCC Aqualia • Interview
FCC Aqualia is working to apply the latest and most efficient technologies in the market to reduce costs and improve performance, but understands that its real assets are its people.
What was the reason behind the acquisition of the Qatarat Desalination Company, and how does it represent your strategic priorities in Saudi right now?
Our business model is focused on acquiring assets or operating the concessions that have been offered in the Saudi market since 2018. The only way to grow for us at this time is through M&As. The acquisition of this asset, the desalination plant at Jeddah Airport, is in our growth strategy. It allows us to avoid the time-consuming process of bidding for tenders while still gaining scale. It is a different business model than some competitors, which shows our interest in and commitment to Saudi Arabia and that we are well financed, because this is a foreign investment. We did not only acquire Qatarat, but also the other company that operates it. We are using this platform to grow the business and we are trying to be selective to avoid entering into the tricky market of tenders. This was our first acquisition in the Kingdom, but we have been working on that model for some time.
In the past, did you work with concessions or primarily by contract?
The work we did on Riyadh’s water system in the past was all contract work. It was leak detection and other key services. We have participated in six concessions, and we have been the leader in three of them. However, Saudi Arabia is extremely competitive, and we are not taking that many risks. There is a bottom line, and with the level of prices on the table so far, we cannot bid on many contracts and maintain our standard of quality. We are conservative and prefer not to enter the business unless there is a good profit and a solid risk assessment. This was not the case with recent tenders.
What is your assessment of the management of the impacts of the pandemic internally and with your operations?
It has been challenging. We have seen limited cases, with around three or four cases over the whole year. We introduced extremely strict measures, and all our contract services have been working without any stoppage. We have been delivering everything on time. The headquarters issued extremely strict guidelines based on global safety regulations. We also adapted to our local market, and it worked without imposing any additional costs. Many people are saying COVID-19 affected their costs. We took some basic measures to buy masks and all those things, but in the end we want to avoid losing people or duplicating positions. It is a case of organizing yourself much better than before, and we have done this so far.
How has your use of technology in the water sector come into play in recent months with your concession and acquisition?
You cannot replace manpower in the water sector with technology. You can improve deficiencies through some digitalization, but in the end you need operators and people to solve things. You can get more information through computers to make decisions, but normally in the water sector there are no computers making decisions. Based on that, we are trying to apply the latest and most efficient technologies in the market to reduce costs and improve performance for more challenging water areas, sewage, or potable water. Unlike other sectors, there is no fully digital system in the water sector; it does not exist and will not.