07.22.14
$6.97 Billion
Key Executives:
Hubert Sagnières, Chairman and CEO
Réal Goulet, President, Essilor Laboratories of America
Eric Perrier, Corp. Sr. VP, Research and Development
Patrick Poncin, Corp. Sr. VP, Global Engineering
John Carrier, President and CEO, Essilor of America
Phil Miller, VP, R&D, Essilor of America
No. of Employees: 55,129
Global Headquarters: Paris, France
Benjamin Disraeli, a late 1800s conservative British politician (twice elected prime minister), writer and aristocrat famously noted: “Seeing much, suffering much, and studying much, are the three pillars of learning.”
If the management of Paris, France-based vision technology company Essilor has its way, the first pillar of learning would be much stronger than the other two.
The company’s 2013 fiscal year was another step closer toward its goal of enabling “everyone around the world to access lenses that meet his or her unique vision requirements.”
Essilor designs and makes lenses to improve and protect eyesight. It also develops equipment, instruments and services for eye-care professionals. For the third year in a row, the company was named to Forbes magazine’s annual Most Innovative Companies list, a ranking of the 100 firms investors think are most likely to generate big, new growth ideas. This year, Essilor ranked 23rd, up from 28th in 2012.
In 2013, the company’s product portfolio generated revenue of nearly 5.1 billion euros ($6.98 billion) for its fiscal year (ended Dec. 31), up 1.5 percent from the previous year. Net profit was 646 million euros ($889.3 million) up from 630 million euros ($832.5 million) for fiscal 2012. Notably, sales of lenses and optical instruments Latin America increased 20.4 percent to 351 million euros ($483.2 million) and increased 12.4 percent in Asia/Middle East/Africa/Pacific to 812 million euros ($1.12 billion). The North American market (35 percent of the company’s revenues), by contrast, rose at 3.3 percent.
Overall, sales of lenses were up 5.3 percent to 4.51 billion euros ($6.21 billion), and equipment sales rose 5.8 percent to 205 million euros ($282 million). Remaining sales primarily comprised the company’s lines of reading glasses, up 6.4 percent to 355 million euros ($488.7 million).
Commenting on the year’s results, Hubert Sagnières, chairman and CEO, said: “In 2013, Essilor consolidated its positions after two years of strong growth. The company improved every indicator and laid extensive groundwork in such future-shaping areas as visual health, the sun lens strategy and brand development, while further expanding in fast-growing countries. These initiatives have strengthened our confidence in the future and will help to drive faster organic growth in the years ahead.”
The company has 28 plants, more than 450 prescription laboratories and edging facilities, as well as several research and development centers around the world. Essilor spends more than 150 million euros a year on R&D, and products launched in the last three years account for approximately 40 percent of the firm’s annual sales.
More than anything, 2013 was a year of growth for Essilor via constant acquisition throughout the year. Fiscal 2013 saw purchases of full or controlling interest in distributors and/or manufacturers in, Turkey, Colombia, Brazil, South Korea, Taiwan, South Africa, India and China, among others.
Sagnières predicted that the company’s “ability to forge partnerships with local industry leaders” while fostering organic growth has moved the company closer to generating annual revenue of 1.5 billion euros in fast-growing and emerging countries by 2015.
The company even created a project in FY12 called “2.5 New Vision Generation” targeting vision problems in emerging growth countries. According to Essilor’s figures, 2.5 billion people worldwide need to have their vision corrected and 95 percent live in emerging countries. India and China have the largest number of people with uncorrected vision. Without change, the number of affected people could reach 3.2 billion by 2050. The company’s New Vision Generation division was established to create “innovative, scalable and profitable inclusive business models” that will add 50 million new eyeglass wearers per year by 2020, according to company officials.
As part of its emerging market outreach, Essilor also formed a Joint Research Center in China with Wenzhou Medical University to investigate the progression of myopia, causes of the condition and ways to fight the disorder. The company has been cooperating with the university for more than 10 years on numerous research projects.
Emerging markets, however, weren’t the only growth play for Essilor in 2013. The company continues to grow its presence in the United States—the world’s largest corrective lens market.
During the year, the company inked a deal for an 80-percent stake in Minnesota-based X-Cel Optical, a manufacturer of ophthalmic lenses. X-Cel Optical produces more than two million lenses a year and generates full-year revenues of approximately $33 million. Essilor also signed a deal with Lenstech Optical, a prescription laboratory in Indiana with annual revenue of $6 million. Later in the year, the company bought a majority interest in prescription lens laboratories Prodigy Optical in Minnesota, which has annual revenue of around $3.5 million, and e.magine Optical in Oklahoma, with annual revenue of approximately $3 million.
Terms of the deals were not disclosed.
July brought the company’s largest-ever deal in which it acquired the 51-percent stake in Transitions Optical, owned by Pittsburgh, Pa.-based PPG Industries. The deal was finalized in April this year. Essilor had owned 49 percent of the company as part of its joint venture with PPG.
Essilor paid $1.73 billion at closing, as well as a deferred payment of $125 million dollars over five years.
Founded in 1990 and based in Pinellas Park, Fla., Transitions Optical is the inventor of variable-tint plastic lenses. The business had been developed jointly by Essilor and PPG. The majority of its products are distributed under the Transitions brand. Transitions Optical generated revenue of $814 million in 2012, of which around $310 million with lens manufacturers other than Essilor.
Under the agreement, Essilor also acquired 100 percent of the capital of Intercast, a high-performance sun-lens manufacturer based in Parma, Italy. In 2012, Intercast’s annual revenue was roughly $34 million.
“This agreement marks the start of a new phase of growth for Transitions Optical, which Essilor and PPG have turned into a leader in photochromic lens products,” said Sagnières. “It’s a company we know well, so the integration process should be smooth. It will enable us to boost expansion in the photochromic segment, which is growing twice as fast as the optical industry, notably in Asia, Latin America and Europe.”
PPG will remain a key partner for Transitions Optical.
Dave Cole, president of Transitions Optical, said: “Since the founding of our business 23 years ago, our parent companies have been key to Transitions Optical’s success. We appreciate PPG’s long investment in and collaboration with our organization. We look forward to a continued strong relationship with PPG as they will be providing ongoing research and development services and optical dyes to Transitions Optical under multi-year agreements with Essilor.”
Concluding the fiscal year, Essilor purchased Lincoln, R.I.-based Costa Inc. for approximately $270 million. Costa makes polarized performance sunglasses and currently derives the majority of its revenue from the Southeastern United States. Plans call for accelerated U.S. geographic expansion as well as international growth.
On the new-product front, Essilor’s primary technology rollout of the year was a new preventive lens offering selective protection against harmful blue light and ultraviolet (UV) radiation that can damage retinal cells and contribute to the development of age-related macular degeneration (AMD) cataracts.
The lens, Crizal Prevencia, is the product of a two-year research project that Essilor conducted in partnership with Paris Vision Institute, one of Europe’s largest eye health research centers. The combined team was able to identify the portion of the visible light spectrum that is noxious to retinal cells. In order to identify the part of the spectrum that is damaging to the human retina, an in-vitro test on retinal cells with narrow screening light exposure to determine the harmfulness of rays depending on their wavelength was developed. This test—a scientific first in ophthalmic optics, according to the company—allowed for the discovery that wavelengths between 415 and 455 nanometers (nm) are the most harmful for the target retinal cells.
Crizal Prevencia lenses are designed to protect eyes from wavelengths that contribute to the degeneration of retinal cells while allowing beneficial blue light to pass through. The lens was developed using Light Scan, an exclusive technology that filters out harmful blue-violet rays that can contribute to AMD, as well as UV rays, an important cause of cataracts, while maintaining the transparency of the lens.
According to figures cited by Essilor, the battle against irreversible eye conditions is targeted at the entire population, but primarily the 1.3 billion children around the world and the 1.9 billion people older than 45 who currently are more vulnerable to blue-violet light. During childhood, the eye is very transparent and lets all visible light and some UV pass through to the retina. After 45, the retina’s natural defense system is weakened; there will be 3.7 billion people worldwide older than 45 in 2050.
During Fiscal 2013, Essilor created the Vision Impact Institute—a group that will act as a global connector of knowledge, data and solutions for vision correction. The institute’s mission is to raise awareness about the socioeconomic impact of poor vision and to foster research where needed. Today’s most widespread disability, impaired vision, affects 4.2 billion worldwide, of whom 2.5 billion have no access to corrective measures.
The World Health Organization estimates that 30 percent of young people in the world under the age of 18 reportedly suffer from uncorrected refractive error, which often is not diagnosed due to lack of awareness or access to care. This proportion rises to 33 percent in the labor force, 37 percent among elderly people and 23 percent among motorists, according to the World Bank and research conducted by the Boston Consulting Group.
The global economic impact is significant. Billions of dollars in productivity are reportedly lost every year, including $50 billion in Europe, $7 billion in Japan, and $22 billion in the United States—even though there are solutions to correct most of the impaired vision cases. The annual global cost of productivity loss—about $275 billion—corresponds to providing an eye exam for half of the current world population. According to the Vision Impact Institute, simple measures might drastically reduce the economic consequences of impaired vision and also the social ones, even though the cost, level of access to care, and awareness differs by country. The institute, which is based in Paris, is guided by an independent advisory board of international vision experts.
Key Executives:
Hubert Sagnières, Chairman and CEO
Réal Goulet, President, Essilor Laboratories of America
Eric Perrier, Corp. Sr. VP, Research and Development
Patrick Poncin, Corp. Sr. VP, Global Engineering
John Carrier, President and CEO, Essilor of America
Phil Miller, VP, R&D, Essilor of America
No. of Employees: 55,129
Global Headquarters: Paris, France
Benjamin Disraeli, a late 1800s conservative British politician (twice elected prime minister), writer and aristocrat famously noted: “Seeing much, suffering much, and studying much, are the three pillars of learning.”
If the management of Paris, France-based vision technology company Essilor has its way, the first pillar of learning would be much stronger than the other two.
The company’s 2013 fiscal year was another step closer toward its goal of enabling “everyone around the world to access lenses that meet his or her unique vision requirements.”
Essilor designs and makes lenses to improve and protect eyesight. It also develops equipment, instruments and services for eye-care professionals. For the third year in a row, the company was named to Forbes magazine’s annual Most Innovative Companies list, a ranking of the 100 firms investors think are most likely to generate big, new growth ideas. This year, Essilor ranked 23rd, up from 28th in 2012.
In 2013, the company’s product portfolio generated revenue of nearly 5.1 billion euros ($6.98 billion) for its fiscal year (ended Dec. 31), up 1.5 percent from the previous year. Net profit was 646 million euros ($889.3 million) up from 630 million euros ($832.5 million) for fiscal 2012. Notably, sales of lenses and optical instruments Latin America increased 20.4 percent to 351 million euros ($483.2 million) and increased 12.4 percent in Asia/Middle East/Africa/Pacific to 812 million euros ($1.12 billion). The North American market (35 percent of the company’s revenues), by contrast, rose at 3.3 percent.
Overall, sales of lenses were up 5.3 percent to 4.51 billion euros ($6.21 billion), and equipment sales rose 5.8 percent to 205 million euros ($282 million). Remaining sales primarily comprised the company’s lines of reading glasses, up 6.4 percent to 355 million euros ($488.7 million).
Commenting on the year’s results, Hubert Sagnières, chairman and CEO, said: “In 2013, Essilor consolidated its positions after two years of strong growth. The company improved every indicator and laid extensive groundwork in such future-shaping areas as visual health, the sun lens strategy and brand development, while further expanding in fast-growing countries. These initiatives have strengthened our confidence in the future and will help to drive faster organic growth in the years ahead.”
The company has 28 plants, more than 450 prescription laboratories and edging facilities, as well as several research and development centers around the world. Essilor spends more than 150 million euros a year on R&D, and products launched in the last three years account for approximately 40 percent of the firm’s annual sales.
More than anything, 2013 was a year of growth for Essilor via constant acquisition throughout the year. Fiscal 2013 saw purchases of full or controlling interest in distributors and/or manufacturers in, Turkey, Colombia, Brazil, South Korea, Taiwan, South Africa, India and China, among others.
Sagnières predicted that the company’s “ability to forge partnerships with local industry leaders” while fostering organic growth has moved the company closer to generating annual revenue of 1.5 billion euros in fast-growing and emerging countries by 2015.
The company even created a project in FY12 called “2.5 New Vision Generation” targeting vision problems in emerging growth countries. According to Essilor’s figures, 2.5 billion people worldwide need to have their vision corrected and 95 percent live in emerging countries. India and China have the largest number of people with uncorrected vision. Without change, the number of affected people could reach 3.2 billion by 2050. The company’s New Vision Generation division was established to create “innovative, scalable and profitable inclusive business models” that will add 50 million new eyeglass wearers per year by 2020, according to company officials.
As part of its emerging market outreach, Essilor also formed a Joint Research Center in China with Wenzhou Medical University to investigate the progression of myopia, causes of the condition and ways to fight the disorder. The company has been cooperating with the university for more than 10 years on numerous research projects.
Emerging markets, however, weren’t the only growth play for Essilor in 2013. The company continues to grow its presence in the United States—the world’s largest corrective lens market.
During the year, the company inked a deal for an 80-percent stake in Minnesota-based X-Cel Optical, a manufacturer of ophthalmic lenses. X-Cel Optical produces more than two million lenses a year and generates full-year revenues of approximately $33 million. Essilor also signed a deal with Lenstech Optical, a prescription laboratory in Indiana with annual revenue of $6 million. Later in the year, the company bought a majority interest in prescription lens laboratories Prodigy Optical in Minnesota, which has annual revenue of around $3.5 million, and e.magine Optical in Oklahoma, with annual revenue of approximately $3 million.
Terms of the deals were not disclosed.
July brought the company’s largest-ever deal in which it acquired the 51-percent stake in Transitions Optical, owned by Pittsburgh, Pa.-based PPG Industries. The deal was finalized in April this year. Essilor had owned 49 percent of the company as part of its joint venture with PPG.
Essilor paid $1.73 billion at closing, as well as a deferred payment of $125 million dollars over five years.
Founded in 1990 and based in Pinellas Park, Fla., Transitions Optical is the inventor of variable-tint plastic lenses. The business had been developed jointly by Essilor and PPG. The majority of its products are distributed under the Transitions brand. Transitions Optical generated revenue of $814 million in 2012, of which around $310 million with lens manufacturers other than Essilor.
Under the agreement, Essilor also acquired 100 percent of the capital of Intercast, a high-performance sun-lens manufacturer based in Parma, Italy. In 2012, Intercast’s annual revenue was roughly $34 million.
“This agreement marks the start of a new phase of growth for Transitions Optical, which Essilor and PPG have turned into a leader in photochromic lens products,” said Sagnières. “It’s a company we know well, so the integration process should be smooth. It will enable us to boost expansion in the photochromic segment, which is growing twice as fast as the optical industry, notably in Asia, Latin America and Europe.”
PPG will remain a key partner for Transitions Optical.
Dave Cole, president of Transitions Optical, said: “Since the founding of our business 23 years ago, our parent companies have been key to Transitions Optical’s success. We appreciate PPG’s long investment in and collaboration with our organization. We look forward to a continued strong relationship with PPG as they will be providing ongoing research and development services and optical dyes to Transitions Optical under multi-year agreements with Essilor.”
Concluding the fiscal year, Essilor purchased Lincoln, R.I.-based Costa Inc. for approximately $270 million. Costa makes polarized performance sunglasses and currently derives the majority of its revenue from the Southeastern United States. Plans call for accelerated U.S. geographic expansion as well as international growth.
On the new-product front, Essilor’s primary technology rollout of the year was a new preventive lens offering selective protection against harmful blue light and ultraviolet (UV) radiation that can damage retinal cells and contribute to the development of age-related macular degeneration (AMD) cataracts.
The lens, Crizal Prevencia, is the product of a two-year research project that Essilor conducted in partnership with Paris Vision Institute, one of Europe’s largest eye health research centers. The combined team was able to identify the portion of the visible light spectrum that is noxious to retinal cells. In order to identify the part of the spectrum that is damaging to the human retina, an in-vitro test on retinal cells with narrow screening light exposure to determine the harmfulness of rays depending on their wavelength was developed. This test—a scientific first in ophthalmic optics, according to the company—allowed for the discovery that wavelengths between 415 and 455 nanometers (nm) are the most harmful for the target retinal cells.
Crizal Prevencia lenses are designed to protect eyes from wavelengths that contribute to the degeneration of retinal cells while allowing beneficial blue light to pass through. The lens was developed using Light Scan, an exclusive technology that filters out harmful blue-violet rays that can contribute to AMD, as well as UV rays, an important cause of cataracts, while maintaining the transparency of the lens.
According to figures cited by Essilor, the battle against irreversible eye conditions is targeted at the entire population, but primarily the 1.3 billion children around the world and the 1.9 billion people older than 45 who currently are more vulnerable to blue-violet light. During childhood, the eye is very transparent and lets all visible light and some UV pass through to the retina. After 45, the retina’s natural defense system is weakened; there will be 3.7 billion people worldwide older than 45 in 2050.
During Fiscal 2013, Essilor created the Vision Impact Institute—a group that will act as a global connector of knowledge, data and solutions for vision correction. The institute’s mission is to raise awareness about the socioeconomic impact of poor vision and to foster research where needed. Today’s most widespread disability, impaired vision, affects 4.2 billion worldwide, of whom 2.5 billion have no access to corrective measures.
The World Health Organization estimates that 30 percent of young people in the world under the age of 18 reportedly suffer from uncorrected refractive error, which often is not diagnosed due to lack of awareness or access to care. This proportion rises to 33 percent in the labor force, 37 percent among elderly people and 23 percent among motorists, according to the World Bank and research conducted by the Boston Consulting Group.
The global economic impact is significant. Billions of dollars in productivity are reportedly lost every year, including $50 billion in Europe, $7 billion in Japan, and $22 billion in the United States—even though there are solutions to correct most of the impaired vision cases. The annual global cost of productivity loss—about $275 billion—corresponds to providing an eye exam for half of the current world population. According to the Vision Impact Institute, simple measures might drastically reduce the economic consequences of impaired vision and also the social ones, even though the cost, level of access to care, and awareness differs by country. The institute, which is based in Paris, is guided by an independent advisory board of international vision experts.