STRATEGY 2008 – 2011: BUILDING GLOBAL LEADERSHIP
In carrying out our commitment to update our strategy every 2-3 years, we began a new process of review in 2007. This effort culminated in the revised strategy Building Global Leadership.

ARCADIS' overall ambition
We aim for a leadership position in each of our business lines: Infrastructure, Environment and Buildings. For each business line, a more specific ambition has been developed.
Click here for the goals per business line, the swot analysis for ARCADIS as a whole and per business line.

But leadership goes beyond the ambitions for the business lines. It also means:

• Superior growth and profitability. In relative terms, we want to be in the upper quartile of our peer group.
• Being an employer of choice. We want to attract and retain the best people. Our culture of innovation and teamwork offers clients the best achievable solutions and provides talent with optimal opportunities for growth.
• Leading in sustainability in the sector. Sustainability is at the heart of our business, and being a leader in this respect has a positive impact on our market position, while helping to attract and retain people.

Key elements in achieving our ambition
We see three key elements for achieving our ambition of being a leading global company:

• Client focus - In order to deliver services across boundaries, client focus is essential. Account management helps us build long-term relationships with select multinational and key national/ local clients who appreciate our value-added services.
• Seamless delivery - Our ability to work seamlessly with consistent high quality in different countries is critical to serving multinational clients and leveraging our expertise across geographies.
• One firm based on strong local positions - Strong local positions are needed to maintain and build relationships with clients. Simultaneously, we want all of our global knowledge and capabilities to be available for our customers. We achieve this balance with a culture of internal collaboration and resource sharing.

What does it take?
The revised strategy has the following implications.

• Continued focus on higher added value services
  This focus contributed to our improved margins over the past years and will be continued.
• Aligning the organization to meet changed needs
  To successfully implement the strategy, the organization will be adjusted by introducing a division type structure in each of the operating companies, reflecting the three business lines. In the United States and the Netherlands, this has already been completed, and the other countries will follow in 2008. In addition, Global Business Line Teams (GBLT) have been established for each business line, bringing together global leadership and operating company leadership. These teams will drive the global business line strategy. For Environment, coordinating client development and delivering global seamless service will be the focus; for Infrastructure, sharing and developing technical knowledge and expertise for business development; and for Buildings, developing synergies in the business line and further developing a global delivery platform for project management.
• Strengthen supporting processes
  People are critical to our strategic success, which is why we have enhanced Human Resources Management. Seamless delivery and the One Firm concept also require strong knowledge management and a solid IT infrastructure. In addition, greater brand visibility and recognition will be based on a sharper positioning and leveraging the strength of the RTKL brand. A global sustainability program will confirm our commitment to improving the environment and help differentiate our brand even further.
• Acquisitions remain high on the priority list
  We will continue with strategic acquisitions. Priorities are driven by building and expanding home market positions and by the strategy for each of the business lines. We want to further strengthen our position in the United States and the United Kingdom, and expand to select European and Asian countries, including India. In Infrastructure, we want to obtain a stronger position in the United States and expand in public transportation and water. In Environment, the main goals are to strengthen positions in Europe and Brazil and add specialized services. In Buildings, we aim to expand project management services in the United States, France and the Middle East and grow RTKL's high-level design and planning practice. We favor larger acquisitions to fulfill multiple goals at the same time. Besides the strategic fit, reputation and quality of management are important criteria. Financially, we aim for acquisitions that are earnings accretive, have margins compatible with ARCADIS' goals and are value enhancing with a return on investment of 15%.

FINANCIAL GOALS
Growth goal is raised to 15%
Because of the shift in our portfolio, ARCADIS' growth profile has improved substantially. In considering such factors as the changed mix in activities, the attractiveness of market conditions over the long term, and the strength of our market positions, we have increased our growth targets for revenue and earnings per share to 15% (excluding currency effects).
This results in the following financial goals for the mid- to long-term (3 years):

• Gross revenue: average annual growth of 15% (formerly 10%), at least half of which is organic.
• Operational margin: at least 10% (formerly 10%) (EBITA as a percentage of net revenue).
• Earnings per share: average annual growth of 15% (formerly 10%) (based on net income from operations).
• Return on invested capital of 15% (formerly 15%). This is net income from operations, excluding interest charges, as percentage of shareholders' equity plus net interest-bearing debt, calculated as an average over four quarters.

These goals exclude the impact of currency exchange rate differences. Net income from operations is before amortization and non-recurring items like book gains. Goodwill is capitalized on the balance sheet as of 2001, as of 2004 the figures are based on IFRS.

Targets per business line
Reaching our goals also depends on market conditions. Click here for the targets for organic growth and margin for each of the business lines.

Performance in comparison to financial goals
Below are the results of previous years compared to the above goals, excluding currency effects.

In %	Goal¹	2003²	2004	2005	2006	2007
Gross revenue	15	10	9³	10	23	26
- Organic	7.5	1	5	5	10	16
- Acquisitions	7.5	9	4	5	13	10
Operational margin	10	6.0	6.24	8.2	9,4	10.54
Earnings per share	15	-4	9	40	50	28
Return on invested capital	15	15.9	17.2	20.6	20,3	20.1
¹ As from 2008 ² Figures based on NL-GAAP ³ Excluding book profit on sales 4 Excluding non-recurring items